Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1907-04-16
STATE TO PASS ON
NEW CORPORATIONS
PETERSON BILL HOLDS CLOSER
& CHECKS ON CORPORATE BODIES
THAN DEFEATED TAX MEASURE
NO WATERED STOCK

New companies organized to Float
Any Project Must go to Executive
Council to Have Valuation Fixed Be.
fore Selling Stock.
Des Moines Bureau of
The Ottumwa Courier,
Des Moines, April 13.
While the attention of the corpora
tons was attracted by the Ericsson bill
which required that they make annual
reports to the secretary Of state and
pay small tax the legislature pass
ed the Peterson bill. Senate File.
No. 100 which is far more drastic and
requires that every stock transaction
of corporation that is not strictly
on cash basis and full paid UP must |
be laid before the executive council
in all its details. Evidently the cor
porations while fighting the Ericsson
bill overlooked lis one
State officials believe the law one
of the most drastic that has ever been
placed on the statute books. 1t will
no longer be possible for the man own
Ing a patent right to place a value IN
that patent and then induce number
of friends to go in with him and put IN
cash to form a corporation to manu-
facture the article. The matter must
be laid before the executive council
and the executive council must put
value on the patent right. If a, man
owns a lot of real estate in some arid
country or anywhere else and hasn't
the funds to hold it and put it on
the market, instead of valuing it him
sell and inducing his friends to form
a stock company with him and they
put in cash and he his land at his own
valuation the executive council will
put the valuation on the land Thep
when the public buys the stock in
the proposed corporation 1t will have
an impartial valuation on the commod-
(, ity 1t is to put It's money against.
No Gifts Of Stock.
The primary intention of the law is
| to prevent new corporations from
watering their stock. or course since
every stock transaction that is not
for cash in full must have the approx
| al Of the executive council 1t will hatd-
| ly be possible for an Iowa corpora
| tion to make presents OF blocks of
|
men for the purpose Of gaining their
intereet and influence in the proposed
undertaking The executive council
and interest of a prominent citizen or
official to be exactly in the interest
of the public
!. While some Of the members of tho
! legislature interposed some objections
10 hi IL
GRAFTON the corporate themselves
did not fight the measure. All their
| time and attention was taken up in
fighting the Ericsson bill which was
/ spoken of as the corporation tax
bill. The real purpose Of the Ericsson
bill was to get reports from the cor
porations to the secretary Of state.
There is a law now that requires them
to report but there is no way Of en-
forcing it and the purpose of the Eric.
son bill was to provide small tax
In addition to the annual report The
funds from the tax would add some
4 to the revenue of the state besides
i guaranteeing a fund with which to en-
force tn provisions of the BILL requir-
4 ing the annual report.
Secretary Of state In Dark.
The Ericsson bill was offered at the
4 request of the secretary of states Of
4 fee. There are hundreds of corpora
!, tons In Iowa that have incorporated
under the laws Of the state of Iowa
that are dead and many others that
have been given the privileges Of the
corporation laws that are doing an
| Illegal business. There are others do
ing business in the state that were
incorporated in other states that have
i no legal right to do business here till
after they have filed certified copies Of
their articles Of Incorporation Yet
the secretary of state has no means
whatever of keeping track Of these
corporations or Of ascertaining what
they are doing. 1t Is quite generally
conceded that they should be some
report to the secretary Of state reg
ularly and it is probable that one Of
the first bills offered to the Thirty
third general assembly will be the
i Ericsson bill or modification Of it.
4 Favor Paving Law.
i Acting on the decision. Of the Sill
preme court in regard to paving at
Iowa City public men interested in
j municipal matters will advocate that a
/ law be placed on the statute books
1 giving free competition in the matter
of street improvements and all other
municipal improvements. 1t is advo-
Gated that instead of following the pre-
i sent plan wherein the city council
passes resolution of necessity for the
4 paving of street, then allows ma
4 jority of the property owners to select
the material with which it is to be
4 paved and then advertise for bids on
that paving alone, the method should
4 be for the city council to pass the re-
solution Of necessity, then advertise
for bids for paving the street allowing
4 the manufacturers of all kinds of paw
ing to enter the competition and offer
their bids in detail. Then allow the
property owners to come in and with
i the bids before them make selection
of the kind Of material they wish to
4 have their street paved with. II the
bids showed that 50 per cent more
was asked for paving the street with
/ - u 49, - 80 ,