The Washington times., 1908-03-25
Ask Congress to~PreVent
Plan OF Gas Initiation

Continued from First Page)
his argument by reviewing the history
OF the passage of section Of the gas
act, saying that the clause giving the
company the right to increase its capt.
tai stock Ito the cash value Of the
plant had not been inserted until after
the bill had been considered by COM
mittees of both ouses "a number Of
times, Finally, he aid. the House was
given to understand that all hope Of
gas legislation IN that Congress would
have to oe abandoned unless the act
passed as amended by the Senate COM
mittee.
81 am opposed to the actual cash
value clause said Mr.. Thomas, be
cause IL admits all indefinite enlarge
ment of the gas c0lCpany's stock which
Congress has heretofore never author
lied. I am satisfied that Congress never
intended the statue TO be construed as
giving the gas company the right 10
include franchises and good VIII IN the
valuation of the plant Congress had
heretofore authorized enlargements
from time to time as they were re-
quired That is a brief statement or
the history OF the legislation not as
strongly put as 1t might be-
Not Fair to Public.
MY fus Their opposition is hased on
the fact that under this act no fair
hearing can be given 10 anybody VINO Is
opposed to the increase Of the capital
stock of these companies, and that II
such stock is increased to include the
franchise and good will 1t may be that
the value OF the property thus held 70
include franchise and good viii might
seemingly call for a higher rate for gas
that is allowed under the act itself, on
the ground that any public service cor
pOTatiOn is entitled 10 fair return ON
its investment. In fixing rate OF 81
Congress did not protect Itself, even dc-
cOrding 20 the privileges now sought
by the gas companies under TINS 'acLudI
cash value clause
THE statute is ambiguous ~ hat is
meant by the word 'plantg The courts
have held in their definition OF tins
word that they were not bound by the
debate which took place on the Hool
of the House. Members frequently adj
dress themselves, / am told, 10 meas
ules without making careful study OF
the language 1 do not take il that con
gress intended that the franchise and
good will of gas companies should De-
included In the definition Of the word
Does the report Of the auditor ap
pointed By the court to reach a yalua-
ton Of the plant include franchise and
good Will as a part of the plant?' in
quired Representative Campbell.
Auditor Valued Franchise.
He does" replied Mr.. Thomas. who
then read from the report OF the Au-
dltor. afterward approved by Justice
Gould, giving the valuation of the
Georgetown plant at 10000, OF which
amount but S46S,522 was named as be
ing the physical property, the balance
representing good viii and franchise
rights. Mr.. Thomas referred here TO
the understanding that the business Of
the plant was increasing about 20 per
cent yearly
He termed as utter nonsense" the
contention OF the auditor that the act
passed b. Congress was primarily 20
protect those who bought and sold the
stock for speculative purposes. The law
should have been construed he said. for
the benefit of the mass OF consumers.
He reminded the committee that 20
vas for them 10 determine whether
Congress intended that franchises
should be included in the cash valuation
Of plant in instances of this kind.
Such position, he held, might be ten
able in tho matter OF contracts and sales
Of property, but not I'm the present in
stance when IL was endeavored by this
means to initiate the stock and perhaps
make possible an increase in the price
Of gas
--'ii-N' e@t'4N'r "a Eases u tIiii4tSu.
domain, rate cases, contract. etc. Wher.
the Intangible property of a company
has been used as a part OF its actua-
cash value"
Danger Would Last for Years.
Representative Sims interviewed bare
with a pertinent question: IF this act
Is held valid by the United States Su-
preme Court and IS not ordered. reneaTaF
oy congress IN the meantime and the
auditors report is accented he .larg
anything TO prevent the conDant, issri.,,
addllional stock ten or twenty vesrs
from now as its franchises and poc5
20 dO2' - "'oi''
49, - .----.---.