New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1905-04-04
COST OF GAS PROBED.
COMPANY'S BIG PROFIT.
Committee Uncouer8 Price of Pro
duction-Conduit Control.

The Legislative Gas Investigating Committee
made good progress yesterday in its effort TO
discover the cost OF gas production in the city,
and 1t uncovered the manner in which the Con-
solidated Gas Company obtained control of the
electrical conduits in the streets 1t also gained
the companys consent to have it's books ex-
amined by experts in the inquiry to ascertain
what profits the company makes in it's dealings
with Its customers and the city Assemblyman
Palmer sat with other members for the first time
IN the session I'm the aldermanic chamber. at
the City Hall. Senator Stevens closed the ses-
sion at o'clock, to enable the committee to
take an afternoon train for Albany.
II was from Benjamin A. Whiteley assistant
treasurer of the Consolidated Gas Company,
that Mr.. hughes. counsel for the committee,
drew the most important information regarding
the cost of gas production. BY persisting in
his questions and insisting on the witness MAX
ing mathematical calculations as they went
along' Mr.. Hughes got on the record that the
Consolidated in 1904 made the following pur-
chases of gas from other companies:
From the New Amsterdam Gas Company,
3.4SI, O3S.GOO cubic feet for which the CONSOLE
dated paid $1.14G.554 81. or about 81 cents a
thousand cubic feet
From the Standard Gas Light Company 60.
S5579O cubic feet. for $2iS,716 o. at about 33
cents
feet, for S29S. 721 So at about 40 cents.
From the Central Union Gas Company. D.
25S3OO cubic feet, for 1851 O3, at about 2S
cents
COST OF GAS PRODUCTION.
Thus it was shown that the Consolidated pur-
chased at a little more than 81 cents a thousand
cubic feet the gas which 1t sold to customers
at 81 a thousand cubic feet. Mr.. Mathewson.
counsel for the company. interpOsed an explana-
tion that the cost of 81 cents a thousand cubic
feet was under contracts, and the Consolidated
had to pay in addition all the cost OF dstribut-
ing the gas to the customers. the loss by leakage
in the pipes in the streets and other expenses
incurred in collections and bookkeeping.
EXPLAINS INCREASE IN STOCKS.
Robert A. Carter, secretary Of the Consoli-
dated, followed Mr.. Whitley in the witness
chair, and said that the $19OOOOOO increase in
the cOmpany's capital stock for "cOnstruc-
ton purposes" OF that sum. he admitted, the
company had invested about $12,OOO,OOO In gold
bonds of the City Of New-YOrk, at low
rate Of interest. while it had to pay per cent
on its own bonds, issued to raise the money.
He could not explain, apparently. why the coEl-
pany invested millions IN low interest bonds and
paid almost double interest. Mr.. Hughes put
1t, to favored stockholders" except that he
said the company might have to use the money
at any time in increasing its facilities. He said
the loss Of interest on the millions invested
was charged to the cost of gas production, and
Senator Page tried to convince him that it
should be charged to profit and loss.
Mr. Hughes said the committee had reached
a point where it was necessary to employ an
pert accountant to examine the books Of the
Consolidated to get the information desired. MIR.
Mathewson at first objected, but being prompted
by officials Of the company, agreed to have such
an examination made with the aid of the COM
pany's own accountant
CONTROL. OF STREET CONDUITs
Henry NJ. Edwards auditor Of the New-York
Edison Company then gave testimony to show
the manner in which the Consolidated had OBJ
tanned control of the conduts in the streets.
The Edison Company it appeared. had been
formed in 1900 by a union Of the Edison IL
Eliminating Company and the Edison Light and
Power Installation Company. The latter COM
pany built for the Empire City Subway Com
pany all the conduits below 1Oth-st., taking its
pay in bonds and stock Of the subway company,
which were deposited under trust agreement
with the Metropolitan Trust Company. The
Edison Company eventually would get the stock
1t therefore controls the cOnduttS as a part or
the Consolidated Gas Company. BY persistent
questioning MI Hughes asCertained from the
witness that the total physical assets of the IL
Illuminating company amounted to S5,SOI,296 30
at the time the company was merged in the
Edison Company. and it was to acquire these
assets, together with the good WILL franchises
and patentB OF the company that debenture
DonQS IOr SSUtSOO,VOO were issued by IuIlHeI
inquiry Mr.. Hughes drew from the witness
that the physical assets of the companies which
were merged into the New-YOrk Gas, Electric
Light. Heat and Power Company amounted to
S13 634 300 against which issued stock to
the amount of $36OO0,OOO. This company. the
witness said, at the time OF its merger with the
Edison Company had assets of $40 02O 100
1.-The actual value Of the properties owned
after its various mergers by the New-York
Gas Electric Light, Heat and Power Company
is SO 52070O as shown by your testimony"
Mr.. Hughes asked.
Yes" replied Mr.. Edwards.
"'And against those physical assets stocks and
bonds were issued for S64OOOOOO:'
The question was not answered when Senator
Stevens adjourned the session. There will be
no session Of the committee to-day, and the in
uuiry is expected to go again Thursday at
10 a. m. at the City Hall.