New-York tribune., 1909-04-19

| apply specifically TO the case of the New York.
| Ontario & western a company whose stock
| is owned largely by the New York, New Haven
| & Hartford. The Ontario & Western once spent
considera ble sums from earnings in permanent
| betterments to its roadbed and rolling stock
| Now, according to the story here. it desires 10
| issue bonds to the amount of those expendl~
| lures. the proceeds of the bond issue going into
| its treasury. from which dividends could be is
sued
ON STATUTE BOOKS SINCE 1850
Joseph H. Choate and other lawyers have ex-
pressed the greatest alarm at effort to repeal
a certain provision of the railroad law declaring
that fares should never be reduced below rate
which would permit the payment of 10 per cent
dividends the capital actually invested
Charles a. Collin. for the Brooklyn Rapid Tran
sit Company. expressed at public hearing last
Wednesday great regret that the old and trusted
railroad lawyers had overlooked the attempt to
repeal this provision. and congratulated every
body in sight that it had been discovered by
of the younger and brighter men in the railroad
group That provision has been on the statute
books since 1870 at least. It's purpose and ef-
feet are patent, and no great surprise is felt
here at the alarm of the railroads, though some
surprise is shown by certain legislators that
such d law was not repealed long ago
The thing the big corporations desire to ac-
must have the approval of the Public Service
commissions for stock or bond issues or changes
for ulat they are working all the time though
no open and concerted attempt will be made to
change that section of the law until Governor
Hughes is out OF office. Men who have studied
its workings say ii has done more to prevent
stock watering and the imitation of capital ac-
counts than any law on the books OF any other
state. II is fear of that provision more than
any other thing which has inspired the hard
hght OF the independent telephone companies to
avoid being brought under the Jurisdiction OF
the commissions. The telephone trust recently
filed official notice of an increase in capital OF
mammoth proportions. and therefore has not
that to fear to so great degree 1t is that
provision which the transit companies in New
York City now in the hands Of federal receiv-
ers must face when they come to reorganize
their affairs. and il is that which they dread
1t is that section which will prevent any such
flood of water first crippled those companies
and eventually threw them into the hands of
receivers. And Il Is that section of law which
stock manipulators and railroad promoters know
will practically put them out of business if it
remains law.
one other phase of legislation deserves pass
ing notice. Many bills tnkerlnS with the spe-
cial franchise tax laws have been introduced.
Their net effect. lawyers say, would be favor
able TO the corporations taxed. Also. the legis-
'N~''A'
to prevent the long and costly refereeships OF
disputed taxes. which have resulted in the non
collection Of some S27,OOOOOO corporation taxes
due to New York city, seems to have struck a
snag somewhere.
Another side of the corporation situation in
the Legislature has come to light which should
be borne In mind by the companies seeking to
emasculate the existing Public Service commits
sions law A bill introduced by Assemblyman
Clark. of Brooklyn reducing to 50 cents the rate
for gas furnished by the Brooklyn Borough Gas
Company, has been passed by the Assembly.
That company does business in the outlying Bay
Ridge section of Brooklyn; 1t is a small COM
pany with small business and II is said that
its directors actually have spent their personal
money to make certain extensions of its system
instead of paying for those extensions by bond |
issues or revenue from earnings. Its rate was
left unchanged with that Of several other COM
panies in a similar condition when the general
SO-cent gas law passed because the Legis- |
lature then believed such rate would be prac- |
ticallv confscatory for those small concerns. |
No complaint as to overcharge ever was filed !
against that company with the Public Service /
Commission for the 1st District Yet the AS |
semblv arbitrarily passed the Clark bill.
The proposed amendments to the Public Ser /
vice commissions law. as changed by the AS !
sembly Railroads Committee. will be on the As !!
sembly's calendar for action on Monday night |
Considerable doubt exists as TO what VIII be |
done with them. The Travis-Lee constitutional
amendment, to which New York City is looking !
for subway funds, passed last Tuesday by the |
Senate is held in the Rules Committee in the As !
sembly The Travis Robinson rapid transit law |
amendments are the Senate calendar on the |
order of final passage. The bill will give rise |
this week 10 a hot debate. and its friends say |
they are not certain of its passage.