Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1910-07-05
PUBLIC UTILITIES
COMMISSION IS
POWERLESS TO AID
Many Other States Give Boards
Power to Regulate Rates,
but Not New Jersey.

- AAAC LII BADA1O al idM. WllC 1
became operative here yesterday, Is a
later enactment than the laws of any
of the forty-one other States In which
public utility corporations. including
railroads, are under control of State
commissions. 1t is the least effective Of
any, because of the absence OF a rate
making clause, without which such a
commission Is well nigh valueless.
The necessity for such a feature In
all public utility governing laws was
unanimously agreed to at the last an
nual convention of the National AS
ISOLATION of Railway Commissioners, In
the following terms:
Among the powers which should be
possessed by al railroad commissions,
that of fixing rates is most important,
and 1t was for this purpose primarily
that a large number OF State commits
sions were created"
Most Commissions Have Power.
An examination of the laws of the
forty-two States in which commissions
exist show that all. except Colorado,
Connecticut New Hampshire and New
Jersey, lave absolute power to fix
maximum freight and passenger rates.
A majority of the State commissions
- POWCA ~ CAAlOf(G VI tUEkI OIuEfb
without the Intervention of the courts.
New Hampshire may fl rates upon
petition, subject to review, and no
tariff OF schedule Of rates may be
changed in Colorado without consent
OF the State commission. 4
While the Connecticut commission
has no power to fax rates 1t makes a
complete physical examination OF all
railroad nroparfv OF Lace turkoo n x<~.~
a complete control over all crossings
and more general owe than the gen.
eral commission. In many States the
corpmission combines the duty of gen.
er6l control with that Of a~scertaining
the true value of railroad property for
the purpose of taxation as well as to
determine reasonable rates for freight
and passenger traffic.
vaIae of Road Is Essential.
The value of the latter system has
been shown in all contested cases, |
where the courts have held that the
primary step to be taken in q de-
termination of the reasonableness of
rates is the determination of the value
of the property of a railroad company.
Such an inquiry was recently COM
pleted In the State OF Washington and
one OF the first results was a reduc-
ton of about 12h per cent. in freight
rates.
The work covered every detail of the
original cost Of construction. cost of
reproduction. depreciation. market
value of stocks and bonds. density Of
population and traific, State and inter-
state operating expenses. cost of move
ment of all classes and commodities
and the market value OF h railroad
property. These findings under the
state law are conclusive testimony In
any proceeding affecting the State and
railroads.
South Dakota Is Energetic.
South Dakota, while having the least
expensive commission. has a remark
ably industrious one. fne members
are on duty all the time and receive
tor their services $500 a year. while
the secretary receives $1,000 annually.
The New Jersey commissioners receive
SIS, uU0 each and the secretary and chief
inspector $4,uu0 each New York has
the highest priced commission-ten
members at $3.50 each, w attorneys
who receive S10,0 each and two sec
retaries each $4,000 a year.
lie RO nCt Va ALI 49, SO
mission is absolute, and acting under
it rates were decreased from 80 to 50
per cent during 1907 and 1908. The
commission has power to enforce all
its orders under a penalty of $1,000 a
day for every violation of the law.
For a continual violation the franchise
of the offending corporation. If a do
nestle one, may be forfeited, and the
Lt-asAr xr4fkf- thA
State is withdrawn If the offender Is a
foreign corporation.
Nebraska Has Scales.
In Nebraska the commission estab-
fishes a maximum rate and no rail-
way may make any change in the rate
without applying for and obtaining the
consent of the commission. Among
other things the railroads operating in
the State are required to do is to pro-
vide scales capable of weighing COM
plete carloads at such points as tho
commission may designate.
In many of the States all officials are
baKred from accepting free passes. but
the railroad commissioners and en-
ployees are allowed to ride free while
in the actual discharge of their duties.
In the States where railroad rates have
been established after a physical valu-
alto nof the railroad property the COM
mission is now conducting similar ex-
aminations of telephone, telegraph, gas,
electric and other utilities.
The Minnesota commission concluded
a physical value of the railroad prop
in tina State, which was followed
by an average. decrease of II per cent.
in freight rates. No reduction was
made in the passenger rates as the
Legislature had in 1907 by statute made
the maximum rate OF two cents a lie.
Examination Results In Decrease.
The Minnesota inquiry covered a
period of about two and a half years.
That is about the length of time the
special commission to ~reappraise the
value Of the railroad property in this
State estimated as necessary to COM
plete the task. Had the New Jersey
commission when named in 1907 been
clothed with rate-making power 1t
might have begun and completed such
Investigation by this time.
state Lost Money.
Such a course would have saved the
State the $4,000 appropriated to date
the purpose of the special appraise-
ment. 1t would also result. in largely
increased revenues from the taxation
of railroad property If the value war