New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1906-02-22
EXPIRING FRANCHISES.

Chairman Hooker of the Assembly Committee
on Railroads has adopted the right policy with
respect 10 the extension of the life OF unlm-
proved franchises. Once on a time franchise
was thought of as a mere permission 10 embark
On a benefcent enterprise, without tangible
value in itself Owners of franchises long cult
waited that view on the part of legislators and
tax assessors. while they instilled another the
ory into Judges and investors. When it came TO
getting franchise. or securing an extension of
IT, or paying a tax on II, a franchise was
most incorpOreal thing. Surely the state could
never refuse its mere formal permission 10 any
body TO do business. They ought TO have the
right without any special permission, and would
have but for the check put upon progress by
meddlesome government. No just state would
dream of taxing property the mere words
You may build n railroad here" But when
the investor appeared. the man with the permit
could invariably prove that those few words
were worth millions. Without yard of track
laid without purchased. he would issue
stock against the franchise. Then. II some evil
dence of fraud in obtaining his permit appeared,
he would convince the courts that the franchise
not a mere promise 10 let him build road,
but actual piece of property which he had
received and sold TO innocent parties. so that
the state could not recover IT. The sale of
franchises and, finally. the taxation of them
have put these grants before the public in their
true light and the utter viciOusness of the
system by which the state lent itself TO prOvid-
ing spectators with stock In trade is now
too clear for the wisdom OF Mr.. HOOkers policy
10 be seriously questioned.
No franchise should ever be granted except
for immediate Improvement 1t is not the prov
ince of the state TO set spectators up in bust
ness or TO give any corporation a mortgage on
the future development of district Investors
who seek franchise, with the resources TO I'M
prove 1t, and intending in good faith to do SO.
can, barring accidents, finish their work within
the time limit. If unexpected physical diff
culties are encountered after construction is
well under way, it may be proper to extend the
time for completing the work Such extensions,
however are entirely different from those so
commonly giSen 10 franchises which are held
for years as mere paper permits, or which are
made the basis of q mere pretence of work be-
fore their expiration in order 10 give an excuse
for extension. A great number OF franchises lie
dormant in this state which ought TO be cleared
away. They the dogs in the manger which
stand in the path OF progress. Street railway
companies have franchises which they hold
partly with the notion that il may some day be
profitable TO operate under them partly with
the idea Of blocking the entrance of any COM
petitor into the field. Then. spectators hold
permits 10 build bridges and tunnels which they
secured in the hope Of enisting capital or of
reapng a fine profit when the public finally
wanted TO make the Improvement itself and SO
bought them out. These franchises are mort
cages given b.- the public on its property
without compensation. And often the public
has bought back its gift. as in the case of the
franchise for the East River Bridge.
Such outstanding claims are obstacles to real
enterprise. both public and private and should
be eXtinguished rapidly possible We
hope that the Railroad Committee will so clearly
announce its policy of extending the life of no
lapsing franchise, and thoroughly establish
1t. that future committees will be held by pop
ular opinion to the same course. Let IT be thor
oUghly understood that the life of no unim-
proved franchise will be extended. and owners
who are acting in good faith will save their
rights. Others should be forced TO forfeit what
they have received. The time allowed by the
law is ample for promoters of diligence. When
they take a franchise they make a contract
The state cannot forfeit their permit for speci-
fed time. and reciprocally they should not have
any privileges beyond that time. They should
be held rigidly TO their agreements. Otherwise
they are simply invited to gamble on the states
good nature and 10 hamper the enterprise of
others.