The Manitowoc pilot. [volume] (Manitowoc, Wis.) 1859-1932, 1907-01-17

/ ROAD which 1t may DC legally dutuOi A~'N ~
purchase or construct, for additions or i'm
provements to its property, for addiuoIal
equipment which may be necessary III tne
operation Of its railroad, and for real estate
that may he needed for railway purposes
The corporation so increasing its capitai
stock is required TO file with the secretary
of state, whenever such issue IS MADE, a
report of the amount issued and the pQr
pose for which 1t has been or Is TO be de-
voted. There is no provision for the super
vision or control OF such issue by state
authority, and no restriction as 10 methous
OF sale of such stock.
In 1903 the Chicago & North Western
Railway company increased It's capltai STOCK
from ST.. 900 900 TO 100000 900, and in DC.
tober, 1906. fled with the secretary OF
state an amendment to It's articles or asso'
citation making Il further increase OF Hloo'
100000. creating a total capitalization OF
$500 100000 The Chicago, Milwaukee *
st Paul Railway company, In october ana
November, 1906, filed amendments 10 us
articles of incorporation Increasing US
capital stock Sl7J.OoOpO from Sf1,OotpoJ
10 $3.50. ocO,OOO Each OF these companies
is at the present time, ana has ior many
years been operating thousands or IhIeS
OF road, fully. equipped, cGnsl3ef4ioiG 81 ,ne
~ probable that either Of these companies,
within the near future, cont'mpatt5 ,Ihe
duplication of its extensive properties. Inc
necessity for this large Increase OF lts
capltaliZat.on by each Of these great com.
panirs is not apparent and may Justly
challenge the attention Of the Legislature.
Moreover. | am ADVISED luHt luH 'uul-
tlonal stock, when issued by either of these
corporations, is subject to the prc-emptlNe
right of existing stockholders TO purchase
the same at par, although It's market value
is largely in excess OF that amount Issue
and sale Of additional stock under sucn
circumstances places an unjust ana un.
reasonable burden upon the commerce or
the state and country, and proper leglsla-
ton should be enacted to prevent the con
tinuancr OF such methods of railway man.
agcment This is but one form OF the eVll
Of over capitalization of public service cor
poratIons, and demonstrates the Importance
or placlng the whole subject under the
control Of competent state authority.
| therefore recommend the enactment or
n law providing that the issue OF stocks
aud bonds, or other evidences OF debt TO be
secured by n Hen or mortgage upon the
property or franchise OF any transportation
corporation organized under the laws or
vision and control OF the state railway
commission, and that any additional stocks
or bonds so issued shall not he sold for less
than the market value when the market
value exceeds the par value.
The state board Of assessment aSccrtIlned
the value of the railway properties or tue
valuation may not be adequate to serve as
q guide 10 the railway commission when
considering the rcasouabloncss Of the rates
prescribed FOR the transportation or pasSru-
gers and freight The cost Of railroad prop
critics must be considered as an element In
determining rates as the earnings OF the
corporation must provide for the rNpens'
OF maintenance and repairs and REASONABLE"
returns upon the capital actually Invested.
/ therefore recommend that the sintr rail
way co... mi sslOn be clothed with adequate
power to determine the value Of the rail.
way properties Of tho state ana TO employ
such experts as may be required to aid In
this work
The governor wants the railway com
mission given power to supervise all is
sues Of stocks and bonds by railroads
and to see that they are not sold at less
than the market value He also wants
the commission empowered TO determine
the value of railroad property.
The governor wants all the laws rclat-
ing to public utility corporations revised.
He wants all franchises limited and sug
gests that all should termintc by Jan
nary /, 1890, at the latest. He recon-
mends a state commission TO regulate the
price of gas, electricity, telephones,
street car fare and all other charges by
public corporations.
The governor favors municipal own
ership and advocates laws to enable cit
les or villages to establish public utili-
ties or by eminent domain to acquire
existing property by payment Of a fair
price.
Necessity for State Control,
The governor says:
A question Of the utmost Importance TO
rrirJIgtn consideration And iudirinrIs arti.,r
Inv tho Trpl,latiIrr relates In mo rnrtrnI
ana regulation hy the sfato Of local ur,bli,
service corporations The services ron
dnrrd Nr this class of corporations greatly
routrlbrtc 10 tho mo und comfort ar tI,1
inhabitants Of the larger cities Of the state
and in many Instances to those residing IN
conlln1nous territory congcsicl
lighting nm gluguutc ,yltrr gmnriv
and the means of rluid tr1usportntlnn
and II these cauuut be- furnished Inv M
munlcipgIitv tho services Of pubIIr 1tiIltv
rurpOr0t lions LpcOlnr Ipdlguru.lLIn n nm
been common practice I'm hi, MS well MS in
other states for tho civ TO grant mo
privllprr Of furnighIup tbrsm rpriIitf,s A.,
rnrporations and franchises have boon
t,raUtrd cNrIrsiyr I'm ryur,ss fnrr,s ,r f.,
prartirnl appllcg'Iou ana mouupnIistIr it
ihpir character which contain no ADEQUATE
-Hfrsuards for the protection Of tho nfIh
Iic The result has bcou tuut tbrg. GOV
r0rHilnus with the aIsrurc of rnvrrurnrrt,I
restraint have grown I'm wealth ANA mower
and have become thr masters ingtrnd nT
the servants of tho ucoplr. Tho standard
If service has not krbt p,rr with thn rrrds
nf the public, or wI ia The rapid Improve
g,.u' " m,.n"", anu ~ RiI "Gos, Wui' iI.
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l"IIa1' 'al,lI'g7 'nLrHuinE over l3mE
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10 IN HV,n imtH aS M1niu .ril NE iarS-
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,I"' n,,,i.,irts ai,. ',,I W ~ l.o
pl'. '"iHP"luIH against service Ahd rates
h"I' I',''N'", nl'I' oll'h.i"H OF 'S'hR"d
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ulN ,ui "a = 'r P"N ~ 10 Pl"p'',S project
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