The Washington times., 1907-12-01
Regulation of Gas Rates.

.manent regulation of rates for gas.
To this end Commissioner Macfar-
.-land is inquiring into the operation
of the laws limiting the dividend
& earnings OF stock issues in vogue in
'sthe various municipalities in Eng
land, and in Boston and Toronto.
Under the operation of these laws
the gas companies in both Boston
land Toronto have within the past
wear made voluntary reduction in
rates.
= The gas supply of Boston since
the time when the memory of man
runneth not to the contrary, has
.'been a dominant element in the poll
tics both of Boston and Massachu-
sets. The graphic portrayal of the
vaccinations of the gas companies
of Boston by Thomas w. lawson in
his "Frenzied Finance" is fresh in
1.-THE minds of its readers. The sup
7ply of this necessary of life has
lbeen exploited in the accumulation
sof colossal fortunes, ana all at the
expense of the powerless consumer.
For many years Boston's rate for
gas was higher than that of almost
any other important city in the
world. It's various companies, prac-
tically all of which belong to the
same individuals, are capitalized for
upwards of S33,OOO,OOO. What rela-
-stion this sum bears to the actual
sjnvestment in the plants does not
appear, but it is safe TO say that it
exceeds the tangible value of the
properties many times. Recent
Legislation has placed restrictions
upon the increase of the capital
stock of such companies, with the
result that, while the evils of over
capitalization have not been entirely
corrected. the conditions have been
Improved.
Previous to the 10th day of June,
1906, the lowest rate at which gas
'-had been supplied to the citizens of
Boston was 81 per 1000. After that
rdate the rate was fixed by the Leg
islature at 90 cents per 1000 feet,
which act also provided that there
after the rate of dividends to stock
holders should be 2 per cent per an
mum on the par value of the capital
stock, which rate of dividend should
not thereafter be increased except
on the following conditions:
"If any year ending on the 30th
day of June the maximum net price
per 1000 feet charged by the COM
pany has been less than the stand
ard price 600 cents) the company
may during the following year de-
clare and pay dividends exceeding
she standard rate e per cent? in
.the ratio of one-fifth of 1 per cent
said maximum net price below the
standard price"
. The Massachusetts laws provide
dOr a careful supervision of the &C
counts of its public service compa-
mics, and in this instance provides
for the publication in the news
papers of the city of Boston of a
report for the year showing the
itemized cost of the various ele-,
lments that enter into the cost Of
producing and delivering gas.
- The result Of the operation Of
this law for one year is that on the
Both day of June last the gas COM
,panies of Boston voluntarily re-
duced the rate from 90 cents to so
rents, which reduction under the
law will permit its earning a divi-
dend of per cent during the pres
cent year. Should the rate for gas
be reduced 10 20 cents, the company
will be entitled to rate of IL per
rent, and when a rate of go cents is
reached the earnings may be 10 per
cent
As the New England Gas and Coke
Company sells gas for % cents per
1000 feet to the distributing compa-
mics in Boston, supplying about one
half of all the gas consumed in that
city. and as the Boston CONSOLE
dated sells some of the smaller com
panies at 30 cents per 1000, it is
reasonable to conclude that 6O-cent
gas will shortly be sold in Boston.
Were there no capitalization of the
franchise and other theoretical val
ues, the Boston Consolidated would
now be selling gas as low as it is
sold anywhere on earth.
9 OF the operation of the regulating
act of Parliament in Toronto, Emer-
son COatswOrth, mayor, says:
Our gas company was incorpo-
rated great many years ago, and,
by a streak of fortune for the pub
lie, a restriction was put in the
charter that they were only TO pay
10 per cent dividends. And the re-