Evening star. [volume] (Washington, D.C.) 1854-1972, 1910-04-13
public corporations in the District of Co

1
! lumbia?
Mr. Goldsborough-H could not be fairly
| applied to them all because the gas com
pany is the only one that is undercap-
! taiized The gas company is undercapi-
| taliZed relative to these other companies
! by anywhere from POO to 500 per. cent.
| That is shown by the taxation rates. We
pay $751; goo annually in taxes The Cap
! ital Traction Company. for instance do
| not wish to say anything derogatory
about it, it is a great company and gives
| the people great service-pays 100000
year i'm taxes upon property capitalized
In securities aggregatng S1S,0O,00D. Take
| the Electric Light Company, for instance
1t renders a fine service There is moth
! ing to say against it-everything for it.
1t has added a great deal to the attract
lVeness of Washington. aud to the value
of property here. The fact remains. new
| ertheless. that it is capitalized for more
| than twice the amount that the gas com
pany is. yet it pays but S66 OGtL-only one
half the amount OF taxes that we pay in
We pay S131,0oo. ! am only mentioning
j these companies as illustrations of the
! point I am making. Our business is as
| large as the business of the Capital Trac-
ton Company. for example and against
! its sixty or eighty miles Of track we have
| four hundred miles of mains. Why. | can
show the committee that over fifty years
age-f have the evidence here in this book
-$5oOcoO. large sum in those days. was
required to equip plant for thirty miles
of these mains. At that time the COM
pany was paying $1.oG0 year in taxes
upon this 5000 plant. We are making
more gas per day now than did in a
| month at that time. The plant today is
twenty times large. the tax bill one
| hundred and thirty -one times larger I
can prove to the satisfaction of the COM
| mlttee by every rule of valuation known
| to engineers that this company is entitled
to capitalization of at least ten million
dollars on its physical plant. not includ-
ing its franchises. So ] think it would
! obviously be very unfair to say that we
! are taxing You upon more than ten mil
lion dollars worth of property and not
! withstandns the fact that you have come
/ forward voluntarily and gone under "A
| constantly. increasing taxation woke from
| time to time and consented to it Vet we
deny you the privilege of having that
property capitalized. 1t is capitalized by
| operation of law.
| 1t makes no difference who owns the
property. Take for instance the company
| that operates the Philadelphia gas sys-
| tenn 1t does not own an inch of the
| mains. 1t owns none of the holders il
owns practically none of the plant; ali of
that belongs to the city of Philadelphia
| and is leased by it to the operating com
pany. Take the Cincinnati Gas Company
as another instance; the operating com
pany does not own the plant: it leases il
from the original owners. So the u,1es-
ton of who owns this property or how
| this property was acquired, whether the
company. destroyed the books thirty wears
ago or not has nothing to do with the case
and should not be permitted to obscure
your Judgment as to the reasona bleness OF
| our earnings.
Mr.. Rothermel-Is that correct
Mr. experimentation destroying
| the books?
| Mr.. RothermelrYes. sir
Mr.. GoldsbOrough-Yes, sir: undoubt-
| eddy.
Mr.. Hazleton-They sold them?
| Mr.. Goldsborough-The books were sold
| and they were destroyed. | am willing to
concede that they were burned for the
| sake of argument. That has nothing on
earth to do with the controversy
| Mr.. Rothermel-Would not the govern
| ment have the right to look into that as
part of the history of the company?
/ Mr. Goldsborough-I should not think So
| Mr.. Rothermel-Would have no right to
see what the company has been doing?
Mr. Goldsborough--That is not the cues
| ton. The government has a perfect right
to know what the gas company has never
denied.
Mr. Rothermel-How can it do so if you
go and destroy the books?
| Mr.. GoIdsborough-That was done thirty
years ago. 1t was done by gentlemen long
since. dead. and do not believe that any
! really good purpose can be subserved by
raking UP their ashes and exposing them
| statute Of. limitations as we'll as a legal
statute, and I think that thirty years
should be long enough to make it ap-
| plicable.
| Mr.. Cary-Do the descendants still hold
any stock?
I Mr. Goldsborough-Someo of them NAV.
and maybe some of them have sold out.
| The most Of them doubtless have, but
that does not affect the case. I want to
say in all fairness to you gentlemen of
the committee, because I realize that all
| of you intend to do what is fair by this
| company. it would be unthinkable that
you could do otherwise do not for one
moment believe that anybody has any