Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-02-06
Issue Before the Committee.

city. etc.
Issue Before the Committee.
The issue before the committee. Mr.. Colds
borough said. remained just where the law
put it, and could be stated as follows:
First. what is a fair appraisement of the
company's property; second, what rate OF
profit is a fair return, and, third, will the
price named in the Madden Ill enable the
company to realize this fair rate? The cash
taxes of more than 81 600 year paid to the
District indicated valuation O. the prop
erty OF approximately $10.OD,0O0.
= At this point Representative ''imrns inter-
should pay one rate of interest and another
corporation another rate, instancing the
fact that the gas company paid 3 per cent
on Its gross earnings and the railway COM
panies 4 per cent. Mr.. Goldsborough knew
of no reason why this condition should OBJ
tain
MIR. Simms then inquired whether Mr..
Goldsborough agreed with Gen. Harries That
a District franchise had no value because of
the alter. appeal and amend clause. Mr..
Goldsborough said he did not agree with
that and thought District franchise did
have a value.
Gen. Harries interrupted with the state
ment that his remark had been misunder-
stood. He thought the alter. appeal and
amend clause tended to reduce the value
of District franchise but that the contin-
nous attacks that were made on local cor
porations from various quarters had a ten
dency to brighten financiers. and he thought
II regrettable when such baseless attacks
received the serious consideration OF COM
mittee of Congress
Representative Babcock here called at
tention to a court decision which declared
that Congress had the same right to alter
appeal or amend a charter given by 1t,
whether that particular stipulation was ex-
pressly made or not.
Mr.. Goidsborough said that another
method of measuring a fair valuation of
corporation is by the average market
values of it's securities for a term of years.
which reflected the public appraisement of
its property. On this basis, the gas prop
erty of the District would exceed $1,000
. COO In value.
Mr. Simms here inquired of Mr.. Colds
borough concerning the certificates Of in
debtedness issued by the gas company.
which Mr. Simms said he understood were
nothing more or less than additional divi-
dends. Mr.. Go!dsborough replied that the
certificates were practically bonds issued
on the theory that the company owed the
stockholders for earnings that had previous
ly been diverted to betterment.
well. it Is practically a dividend, Is 1t
nOt?" asked Mr. Simms.
Yes" replied Mr.. Goldsborough.
Representative Meyer of Louisiana here
asked Mr.. Goldsborough if these certifi-
Gates were not issued subsequent to the
companys attempt to increase it's capital
stock and that failing to secure this desired
legislation. secured the same result by the
Issuance of the certificates. Mr.. Goldsbor-
ough admitted that prior to the issuance
of the certificates a bill had been intro
duced to Increase the capital stock of the
company to approximately the market val
ue of its plant.
Mr.. Sims went into the matter of the
certificates in considerable detail but with
out eliciting any new information of. any
great Importance.