The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1903-07-16
Chicago's Franchise Problem.

Judge Grosscup of Chicago has given
1t as his opinion that the 99-year fran
chise of the Union Traction company to
operate street railways in Chicago is |
valid. The opinion Is not a judicial de-
cision, but is given out as in the form Of
instructions to the receiver Of the COM
pany. AS we understand 1t, the receiver
was appointed as means of securing a
solution Of the franchise question salts
factory to the company. The Chicago
city authorities had taken the position
that the franchise terminates on July 80
If this were the case, the financial cond1-
vision for the renewal of the franchise, |
would be precarious, indeed.
Altho the city was notified that Judge
Grosscup in instructing the receiver how
to manage the property, In view OF the
disputed franchise question, would have
to take definite position regarding Its
status, the city refused to be a party to a
proceeding Of no judicial value, so that
the dispute has not been settled by ad-
judication. Nevertheless Judge Grosscup
has clearly stated his belief that the
company unquestionably enjoys 90.
year lease from Aug. 16, 1858.
The judges position favors the company
in every respect Even those who had
. feared that he might be constrained to
hold that the franchise had still forty
four years to run, pointed out that the
franchise could only apply for so long
term to the particular streets granted
to the company at the time the Illinois
legislature gave it a franchise SO opposed
to public policy. That being the case,
the 99-year franchise would be of little
use to the company except that 1t would
be of some assistance in bargaining with
] the city, for control of limited mile
age in the center of the city would be
of little use if it had no authority over
the main part of the system, created since
the legislative act of 1861. Judge Gross
. cup, however, holds that the legislature
Z contemplated the extension of the sys-
tenn and that the 99-year clause applies on
all streets subsequently, occupied by the
!. company.
: The judges opinion will be Of immense
value to the Union Traction company, as
it puts it into prime condition for bar
gaining with the city. 1t Is not now a
. question, Of merely giving the Union
), Traction company 20-year franchise
: under the Mueller law passed by the last
! Illinois legislature, but it is a question
Of buying up from the company its rights
under the 99-year franchise. In fact,
Judge Grosscup says there is no way for
Chicago to progress towards municipal
ownership, as it's people desire to, until
the traction company. has been bought
off. The cash value of a franchise that
has yet forty-four years to run Is some
thing appalling. Aware of this, Judge
Grosscup says that the burden ought to
be borne by the next generation. About
the only ray Of hope in the decision for
poor Chicago is that the judge asserts
that his court has the power to and will
compel the traction company or companies
''to accept any reasonable arrangement
that does not involve confscation Of prop
erty rights" and he urges the city and
the private parties interested to arrange
compromise on that basis.
1t must be presumed that this is good
law, but 1t is a terrible warning to every
community that is thinking Of giving
away for a long term of years a fran
chise that now seems to be Of little value.