The Washington times., 1911-12-22
THE TWO PUBLIC UTILITIES
MEASURES.

II e1tner Jne Oldneld or the Ealing
er public utilities bill passes Congress,
Washington will have reason to be
grateful. They are both good meas
ures. The expression of a preference
for the Oldfield draft need not be
taken as depreciation of the measure
which has been presented by the chair
man of the Senate Committee.
The Oldfield bill crystallizes into
single elaborate measure the accumu-
lated experience, legislation, and ad-
judication of the whoe subject of
municipal utility regulation in this
country, and adds little to it. For
example, there is a provision that, in
fixing rates and charges, the commits
sion shall be guided by the purpose to
maintain at all times, in the public's
interest, the LOWEST rates that the
courts will hold to be reasonable. This
is highly important. The adjudica-
tions indicate that the courts have
refused to hold that particular
profit.producing figure is reasonable,
from which there may not be varia-
ton. A rate that will earn 8 per cent
has been held fair to the corporation;
but one that will earn IL per cent has
been held not to be unfair to the pub
lie. There being thus wide latitude
for exercise of discretion, the Oldfield
proposal is that the public shall get
all the benefits; the rate shall be kept
as LOW as it reasonably can, with
view to avoiding injunction for con-
fiscation. -.
No more rigorous prohibitions of
capitalization have been adopted in
this country than those Of the Wiscon-
sin public utilities law; and these are
copied in full into the Oldfield bill.
Capitalization must represent actual,
present values; and the commission
has authority to veto any issue of
capitalization if, after examining and
valuing the property for which it is
to be issued, or considering the necessi-
ties for the issue, it is held that the
property is not worth the price, or
there is not full justification for such
an issue.
How this would work in Washing.
ton was illustrated tlst the other day
in Georgia. That State has COM
mission, which passes on the capitali-
cation of public utilities; they may
not issue it till after approval by the
commission. The Georgia Railway and
Power Company appeared before the
commission, asking authorization of an
issue of $27 ,OO0,OO of stock and $780,
00O,O 900 of bonds. The commission
looked into the affair, decided that the
figures were excessive, and this is what
it ordered:
The $30,0OO,OO0 bond issue is author
lied; but only $l2,OOO,OOO may be is
sued now, and before more can be put
out the commission will investigate
the work done and proposed, and give
the authority.
| Ahc PSiJoVV,VOO Vi BUNK Is HeiQ u
be excessive, and the commission di
reefs that not over $l7,OO0OOO Of
stock shall be emitted.
Such law as that, had it been il
effect when our street car consolida
tions and reorganizations were fl
nanced, would have done noble servic'
to this community. Our street car lines
would not have been so hopelessly sub
merged as they are today, and ever,
proposition looking to better an,
cheaper service would not have me
the bitter opposition which is inspire,
Eby fear that the water may refuse t,
CONCEAL into the solid substance o
dividends.
These are the kinds of regulation
the public interest demands. Univer
sal transfers are provided for in tn
Oldfield measure, and that is a goo
thing. But the control of capitalize
tion, the adoption of the policy o
keeping rates as low as possible con
stitutionally, is still more important
The Oldfieid bill if passed would be
come a model in progressive States an
cities, and would give a splendid i'm
petus to the whole national movement
for effective control.