Eagle River review. [volume] (Eagle River, Wis.) 1890-1927, 1907-01-18
DAVIDSON MAKES RECOMMENDA-
TONS TO THE LEGIS-
LATURE.
CONTROL CORPORATIONS.
Wants Commission to Fix Prices of Pub
Lie Utilities-Advocates Mu-
nicipal Ownership.

~
points out that the state was never SO
prosperous as it is at the present time.
He says money is plenty and interest
low, and evidences of luxury and COM
fort are on every hand, yet there is much
unrest among the people all over the
country. This has taken form in a de-
mand for government control of public
service corporations.
The governor points out that never be-
fore have the states finances been in
such splendid condition, the receipts
having far exceeded the heavy appro-
priations. Their is in the treasury ST.
O12, 201.65.
Taxation.
The governor advocates an amend
ment to the constitution providing for
an income tax and he says that the tax
ing of personal property often leads to
injustice, and thinks it fairer to raise
revenue by corporate, Inheritance and in
come taxes. He advocates the repeal
Of Chapter 37S, laws of 1903, which pro-
yides that the mortgages interest shall
be an interest in the land and shall, I'M
less the mortgagOr otherwise directs, be
assessed separately to the mortgage. He
wants Il law providing for state at
torney to attend county courts where es-
tates are being probated to see that the
state is not defrauded in the collection
OF inheritance tax.
The governor asks the Legislature to
more clearly define the powers and du-
ties OF the state railway commission. He
recommends that the commission be
given power to regulate all transporta-
ton companies, including street rail
ways.
The governor says:
The work accomplished by the state rail
way commission during the brief period Of
one and one-half years since its creation
pursuant to chapter 362 of the laws Of
1908, more than justities the long strug-
gle for it's establishment. The dispatch
with which this commission has proceeded
to unrayel the many problems growing out
OF our intricate transportation system, the
palnstak1ng thoroughness which has char
acteriZed it's labors, and the speedy relief
which has been granted to all interests in
answer to complaints as varied as they
were numerous, must challenge the admit
this commission being highly technical in
character. it is a source Of much gratifca-
ton that its present membership is so
JtrQngly equipped for it's task, not only
With practical experience and knowledge,
but also with such expert technical skill
for each special line of investigation and
decision as to be completely in sympathy
with the important interests which it was
created TO protect and to harmonize.
Up to Dfeem6 oeG 1906 o. fGf
the commission, of which number 81
were disposed of without a ruling Of
the commission. In addition to the formal
complaints 557 informal complaints were
considered. Transportation rates, on grain
cattle, coal. lumber and cheese have been
reduced, resulting in material savings to. the
public. Extensive original Investigations
have been conducted in the field Of pas
senger charges, maximum freight rates.
classiications, weights and accommoda-
lions furnished to the travelling public
which will be the basis of important rul-
in0S in the future.
While their operation under the law has
revealed no serious weakness in its struc-
ture, but on the other hand has demon
strated the excellence and conscientious
ness of the work done in its preparation,
yet the commissioners desire legislative ac-
ton to meet certain conditions not exist
ing at the time the law was passed or
not then anticipated, to harmonic it with
other statutes relating to corporations and
which have been upon the statute books
for many years.
BY far the most important recommends
ton for the Legislatures attention is the
request for a more explicit definition OF
it's powers and duties concerning the regu-
lation Of street railway companies. Under
the construction by the attorney general
and the commission the law at present con-
fers jurisdiction to regulate any street
railway company whose lines pass beyond
the limits of the city in which it operates.
This right Of regulation extends not only
to the urban business of the company but
also to the business of the company out
side of the city. AS result the commits
hAS~S%
the entire business of a street railway COM
pany where any part Of it's lines extend be-
yond the limits of the city but no power OF
supervision where the operations of the
company are confined strictly to urban
business In other words the jurisdiction
of the commission is made to depend en-
extending beyond the corporate confines of
the city wherein it operates. Manifestly,
this classification Is not proper basis for
the regulation of street railway companies.
Whether the power and duty to regulate
all public service corporations, including
street railway companies, shall be lodged
problems which this Legislature should
solve. Concerning the regulation of such
corporations, more is said in another part
of this message, but suffice to say, that as
this law now stands, satisfactory and sci
entifc regulation Of street railway COM
panies is impossible, and | respectfully rec
ommend to your honorable body that this
law be so amended as to extend to the
commission jurisdiction over all transporta-
ton e h Of the ne Wits
municipal limits, or the charter OF their
service.
Issue of Stocks and Bonds by Railway
Companies.
1t has long been the settled policy of this
state that capitalization of corporations
should be measured by actual Investment.
since been in force, prohibits the issue Of
any stock by corporation, except in con
SlQeratlOn OF money OF IdDOf OF property,
estimated at its true money value actually
received by. it at the par value thereof, or
the issue Of bonds at less than IS per cent.
of the par value, except when such stocks
or bonds have been listed on the. stock ex-
change, sales may be. made at current
prices The purpose of the statute is plain
and is highly commendable but it is de-
fectiye in that it contains no provision for
administrative control over the subject In
a purely private corporation, the only par
ties directly concerned in the issue of stock
are the stockholders and the creditors, Ii
there are any. To the former the consider
alton for which the stock is issued is a
matter Of little consequence, If all pay at
the same rate and receive the same amount
in annual dividends.
With respect to public service corpora
tions the situation is different, as dividends
on the stock and interest on the bonds
must be paid out of the earnings arising
from the business, which is OF public
character. The management Of such cor
porations feels justified in fixing rates
which will yield a sufficient sum to pay the
cost Of maintenance and operation ana 9TH
Cd indnhtndness and reasonable dividends