Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1909-03-08

- 80 il,
Missouri lines. The railroads contended
that the rates fixed by the statutes oi
the state were not remunerative but
5.confscatory. and that the enforcement
Of the statutes be enjoined. The state
brought proceedings to have them en-
forced.
Rates Not Remunerative.
.eThe question:" said Judge McPher-
son in his decision, "is whether the
traffic wholly within the state Of Mis-
souri generally referred to dn the evil
dence as local traffic, canAbe carried
under the freight rate statute OF June
I'll, 1907, and the passenger fare statute
OF 1907 at such profit as will give
Reasonable return after paying ex-
penses upon the investment, or Whetn-
or such traffic is carried at loss or
less than such reasonable proht. Inc
court has reached the conclusion that
,lpon this question the statutory rates
fixed by either and both statutes are
not remunerative.
4 Burden Of Proof on Railways.
!. In giving the reasons for such con-
clusions the decision says:
"The unuuestioned and undoubted
rule is that there is a presumption both
Of fact and of law in favor of the val
ddity of every legislative enactment.
The railway companies have the bur-
den spfremoving this presumption, and
showing that the statute clearly, or as
sorao courts say, palpably, and others
say, beyond a reasonable doubt, that
the statute is invalid. In these cases
the court has recognized this rule. The
authorities upon this question form a
long and unbroken line, with the single
exception of the majority opinion III
the Pennsylvania case decided a. year
ago. And that one authority is lot
persuasive II
II Wrong Conclusions.
Most OF laymen and many lawyers
believe that the question is whether
the railway company as a system Is
earning sufficient revenue upon the
value of the property Of the system.
They believe that if the Burlington,
Santa Fe, Wabash, or any other rail-
road system ds earning such money as
will pay all charges and expenses in
Guiding taxes and interest, with rea-
sonable dividends to the stockholders,
that state rates for state business
must stand. OF course no one believes
this who has given the slightest atten-
ton to the question. That precise
question was before, and was decided
by, Justice Brewer, and affirmed by
the supreme court In the Nebraska case
OF Smyth VS.. Ames. The only question
Is as to Missouri rates, less expenses
properly charged against the same.
And IL this balance. does not leave suf-
flcient to pay a reasonable return, tho
law as invalid And If the railroad
system of any company is earning
more than q reasonable return by rea-
son Of interstate rates, which affect the
people many times more than local
rates, and il such interstate rates are
too high, congress, either acting alone
or thru q commission, must make the
corrections.
& Cites New York Gas.
saThe supreme court during the pres
ent year In the case of City of New
York VS.. Consolidated Gas Company
Of New York, decided that 6 per cent
was fair and right to be given TO the
y
opinion is that while gas plant is in
some respects different from railroad,
that a railroad property, properly built
and, properly managed, should over and
elbove expenses make a return of 6
her cent per annunl. And considering
etll the evidence, the evidence fairly
shows that all these roads were prop
srly and economically built and are
1>eing properly and economically man
aged, and that after paying the ex-
penses for maintenance and operation,
that there is less than six per cent of
returns, and not more than 8 per cent
upon any of them and as to some of
them a deficit, taking the property
els above stated within the state of
Missouri, at Its fair valuation. And this
is so without reference to bonds, be-
cause in no case do the bonds bear 6
per. cent interest. But taking the bonds
itno consideration, there is still not
to. o.exceed 3 percent returns and in many
cases q deficit after considering all
dIel,its and credits, upon the true valua-
tion for the state business. There is
no evidence that any of the existing
bonds were improperly issued either
as TO amounts or rates of interest. In
fixing the value the court has consid-
cred the evidence of witnesses as to the
stocks and bonds outstanding, and the
state board for taxing purposes has
valued these properties. OF course
those findings are not binding nor con-
elusive, but they are persuasive. But
independently OF stocks and bonds, and
Independently of what tbe state board
has valued these properties for taxing
purposes, the evidence shows the valu-
ations to be recited in the findings Of
fact herewith filed. and to which ref
erence will be made in the DEGREES.
Revenues Must Rule.
ut Is absolutely necessary that many
trains, both passenger and freight. do
both a local and interstate business.
Even the fast trains stopping at but
few stations in the state, carry state
passengers between such stations. And