New-York tribune., 1911-01-05
DECLARES P. S. c. INVITES
A SENSELESS SACRIFICE
F. w. Whitridge, Receiver for
Third Ave. Railroad, Severely
CritiCiSeS Commission.
ATTACKS OFFICIAL ORDERS
Tells Bondholders That in View
of Rejection Of Reorganiza-
tion Plan Company May
Have to Limp Along.

fnaue yesterday to the hondholderS OF
the condition Of the property. severely
criticises the Public Service Commission
for its action in rejecting the second re-
organization plan of the Third Avenue
bondholders' committee and attacks the
work Of the commission in general. He
also refers to the various suits at law
brought against him by the commits
sion including one for SSOOOOO. all of
which, he says. were unsuccessful and
were a waste Of time and money for
everybody concerned.
Speaking Of the rejection of fhe reor-
eanization plans submitted to the COM
mission by the bondhoders committee,
Mr. Whitridge says:
Two plans of reorganization have
been submitted to the commission and
rejected. In rejecting the second plan
the commission has announced views
which are very serious not only for
your property but for the whole COM
munity An appeal from this decision
has been taken to the courts. but should
it be decided that the jurisdiction Of the
commission is exclusive and its views
should not be retracted or modified it
is plain enough that no property within
the Jurisdiction Of the commission of the
1st District can ever be reorganized,
and that no capital can he obtained for
any public service corporation In this
city from any banker on any terms
whatsoever, and. in the case of the Third
Avenue, IL may become necessary by
some contract between the security
holders themselves TO avoid all reference
to the commission and let the company
limp along as best it can
lie adds that the commission. in con-
sidering the last reorganization plan,
would not distinguish between the case
Of a company which was already capt.
talized and had an assured income and
the case of a new enterprise. which was
issuing securities for the first time to Sc
cure capital for construction.
Fixed Value Regardless Of Cost.
80 far as l can understand its views"
he says "the commission thought, fur
ther, that the amount of securities to be
issued for the Third Avenue was to be
decided without reference to the old Sc
curities or TO the necessities of the
property. but solely with reference to
the value of the property. Now value is
subjective conception; II is not a di-
mension to be measured by an external
standard.
The commission however, has fixed
the value of your property, not with re-
gard to its cost, nor to the amount Of
cash paid into IT, nor to its earning ca
pacity. nor to its actual earnings. nor to
the report of the commissions own bu-
reau of appraisers, which II has had at
work at great expense and without legal
authority, the commission has fixed il
by asking its own engineer about 1t. and
from his appraisal it has deduced Il
theoretical depreciation of S11.VOOOO,
leaving about S2O,O0O,OOO as the amount
of new securities which may be issued
In exchange for $3S, 10000 of your bonds
and S16OGO,OrO of stock of the old COM
pany. That is TO say, a man who has
them. and it is perfectly useless TO ex-
plain to him that his property has suf-
fered a theoretical depreciation of $11,-
600. 900. because his own eyes enable
him to see that such is not the fact.
Moreover. were it not for the neces-
sity of raising $7,O0O.OO0 and paying in
terest on II, his property would appear
to be now earning substantially the
whole of the interest upon the bonds to
he paid for. To his mind the commission
invites him TO senseless sacrifice. The
commissions activities, though of a diff
ferent character, seem To him TO be more
devastating and more indefensible than
the performances of the old Metropolitan
company, which the commission was ap-
pojnted TO abolish and he cannot be per-
shaded that the commission is not play
ing the fool with his property.
Saws People Will Cast II Out.
"The people have, however made up
tbe,r minds. partly in consequence OF
crave scandal. that the state must have
an amount of regulation and control OF
individual activiues-which would have
orraI,ad orr forefathers unless done in
tho name of rcliGion-so the state control
uas established. The state must, how
ever. speak through men. and If those
men appointed to exercise such control
do not speak with voice which COM
,rands respect, and are found adopting
crude theories like those about valua-
tion which they cannot digest (and
which they undertake to apply with no
more common sense than a hen). then
the victims at first and the whole public
finally. become exasperated and cry:
Away with them! Away with them!'
And away they then must go.
"Tbis commission in the First Dis
tr,ct has in my judgment, demonstrated
that Il must return to the shades whence
g emerged. think the people are Of
,bat oninion. By removal. consolidation
or resignation we must part with II. In
the slang Of the day, 1t has not made
good and it must GO
Mr. Whitridge has also sent the bond
bo,ders a book Of about five hundred
naees containing copies Of all the cor
respondence that has passed between
him and the commission. In a letter
accompanying the book he says;
Sui. a misuse Of Power"
"since the date of the last letter it has