Evening bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1895-1912, 1911-03-15
NEED FRANCHISE
FOR THEFUTURE
Rapid Transit Officials Say
Road Contemplates Great
Development.

| Land Company, many extensions
| and a general betterment of the SER
| vice will be carried out if the new
| franchise bill now before the legisla-
ture is passed. If the car service is
to continue to keep pace with the
growth of the city, the new franchise
| is necessary; otherwise the company
| must begin to provide sinking fund
| to protect the interests of the stock
! holders when the present franchise
expires in eighteen years from now
Facts such as these, in addition to
clear statements as to what the COM
| pany has accomplished were brought
out yesterday afternoon when Off
Gals of the Rapid Transit Company
appeared before the house commit
tee on public lands and internal i'm
provements TO urge the recommends
ton of the franchise bill to the house.
The meeting was not public, the Off
GERS alone being invited, although sew
eral interested citizens dropped into
the attorney-general's office where
the meeting was held.
President L. Tenney Peck made the
principal arguments in favor of the
franchise, and General Manager C.
G. Ballentyne and w. R. Castle also
added a few words, while Secretary
A. l.. Castle was also present but
took no part, inasmuch as he is a
member of the legislature.
The officers of the company re-
viewed not only the history of work
accomplished by the street-car sys-
tenn, but its future, and dWelt par
ticularly on the reasons for asking the
new franchise.
In this connection was brought out
a point that has been almost neg
lected in public discussions of the
subject, namely, that the Rapid Tran
sit Company, as a bonus for the grant
ing of the franchise, will give two
and one-half per cent of the gross
earnings of the company to the Ter
ritory, this bonus to begin six years
from now and running out in eleven
years. 1t should be noticed that this
two and one-half per cent is entirely
apart from the two and one-half per
cent public service corporation tax
that is to be given under the new
franchise. The bonus which begins
in six years Is not required under
the franchise at ALL but the new
franchise requires it.
President L. Tenney Peck estimat-
ed that the bonus, during the twelve
years before the expiration of the pre-
sent charter. will amount to $250000,
perhaps more.
In opening his remarks, President
Peck stated that the new franchise
bill extends the franchise until prac-
tically 1850, making it co-existent
with the charter, the franchise hav-
ing been granted for thirty years and
the charter for fifty.
He took up briefly the terms of the
proposed charter GAS to the provi-
sion allowing the use of internal COM
bustion engines" he said when the
franchise was granted the internal
combustion engine was new and
sometimes dangerous and it was
thought best not to allow it on street.
cars. Now it is the engine of the
automobile. By allowing the COM
pany to install these, it will be posi-
BILE to run owl cars. Now the ex-
pense of running the big engines Is
too much to warrant the use of one
or two late cars
He then went on TO discuss the pre-
sent franchise and its effects. at is
expressly stipulated under the fran
chise that if we wished to keep pace
with the development of the city, if
we expanded and progressed we
could use the receipts for betterment.
But If the company stands STILL then
the company must provide sinking
funds to conserve the interests of the
stockholders, and must divide with
the government above eight per cent
Gentlemen, the stockholders have
foreborne to participate in the pro-
fits, The receipts have been put back
into the system. The highest divi-
dend for any one year was $50, 900,
less than three per cent The mo-
ney has been put back into the prop
erty itself. The road has cost APP
proximately $1,9O000O to date, of
which onethird was contributed by
the stockholders. one third by borrow
ing and one third from the earnings
of the road-which could have been
paid out as dividends. The company
has not set aside one dollar for a
capital sinking fund Under the fran
chise the division of the Territory
takes place after the expenses have
been paid and the sinking fund pro-
vided for. We have had no sinking
fund, for the money has been used to
better the system. AS to this, we have
no apologies to offer.,'
He also pointed out how the Ter
ritory has benefited from the tax re-
ceipts from the road 1.-THE horse
car system paid $3.50 In taxes the
year before we succeeded II, he add
ed Last year we paid $22,1S7"
Referring to the bonus offered, ne
said: 1.-TWO and one half per cent of
the gross receipts now will amount
to between eleven and twelve thous-
and a year and 1t will. we believe
be at least $4,000 when tho bonus
begins, From then until the new
franchise begins, 1t will amount tol
at least s250,00O, This we are under
no obligation to pay, it is offered as
a bonus for the franchise"
General Manager Ballontyne spoke
briefly of improvements contemplate
ed including now par-haruQ now pare