The Montgomery advertiser., 1908-03-30

fIciently high standard of wages to at. tract the service of competent and faithful mon in all of its departments. when sh best condSctsd. and md shares for for good or i'll tho fortunes of the com- munities and localities it serves and 1t must maintain and increase it's facii- these matters it's Interests and those of of the public are In a largo sense. le- gally and morally, identical, and If a schedule of rates does not permit the carrier to earn sufficient income to pro- perly discharge these duties. the public good. as we'll as the interest of the owners. is generally harmed. The right to remuneration for the cost Of service 50 as to meet the just wants of the public and fully discharge the duties exacted of it by law. Is, there fore. as vital to the public. welfare as owner, and when we state the rights of theycarrfer and enforce them in that respect. tt ls only another mode of stat inR and enforcing the rights of the cable to the right of the carrier to aarn a fair amount above the cost of the service. upon the value of the capi- tai employed in his business. It Is well Rate Regulation. Section 4os. Tt ought always be plain that those who invest their funds in some public employment are going to get fair per cont. upon their investment: because unless they are assured of this they will employ thair money elsewhere, and many en- terprise necessary for the public con venience will not be undertaken, nor will existing plants be extended. It is. then, not only due consideration for the rights of others who have already in- vested their money in public service companies. but also an enlightened self which dictates the policy that reas- enable return upon the value of the property used iny the public service shall be protected by the constitution.''
 While the Supreme Court has. not fixed any precise amount or laid down any unvaryfng standard. for determir- ing the per centum of net profit, the State courts and the Iesver Federal courts have generally adopted as the standard. at last as high measure of profit as the current rate of return upon enterprises of similar char acter, in the localities where the car rier's business fs transacted.
 Tn l.. and N. Railroad Co. v. Commiez sioners of Florida, 123 Fed. 947. Judge Pardee held that a railroad company, So long as its rates are rsascnable and an amount on the value of It's road equal to the Usual legal rate of inter est in the locality, where its road is pany vs. Memphis. 72 Fed. Rep. 1t was hold that a gas company has a right 10 such gross revenue as will enable it to pay all legitimate operating ex- penses. pay interest on valid fixed charges. on bonds or securities so far as they represent expenditures actually made in good faith. and to pay a reast enable dividend on stock, so far as this represents an actual investment in the enterprise. In Spring Valley Water Works Company vs. City and County of San Francisco, 124 Fed. STA, where the rates fixed would not permit annual net earnings of over {. 70 per cent. on the value of the property nec- essarily employed in the service, 1t was held that the return allowed by the schedule of rates was too low to be reasonable and just, in view of the usual net income from capital invest ed in similar large corporations on the Pacific Coast. whici. earned not less than per cent.
 In Milwaukee Electric Railway and Light Company vs. City of Milwaukee 87. Fed. 577-5S5, where it was shown that per cent. on real estate mortgages and like securities was the prevailing rate, it was held that a schedule of rates which prevented earn ing that much upon the value of the property used was unreasonable.
 The question Is ably discussed by Mfr Justice Savage in Brunswick Water Company vs. Maine Water Com- pany. 99 Maine. 371. See also Re Advance in Freight Rates, Q Interstate CommercA Commission Reports. SS2. Canada Southern Railway Company vs. International Bridge Company, L. R. A.,