Evening star., 1912-11-22
BUT ONE SYSTEM FAVORED
Report Made to Association Of Rail.
way Commissioners.
PHONE RATES FIXED BY LAW
Discussion of Transportation Service
at Final Meeting Of Convention
in This City.

Ine question OF Whether or not the Ma
tional Association of Railway Commits
sioners shall encourage open competition
or comparative monopoly, under regula-
ton, of the telephone systems, was
brought up today at the concluding ses-
sions of the convention of the commits
sioners, which has been in progress here
the past week.
A. p. Watson, state railway commits
sioner of Oklahoma, presented to the con-
vention the report of the committee on
telephone and telegraph rates and serv-
ice, introducing it with an address in
which he told Of conditions in Oklahoma,
where there is state control of telephone
systems, and where, he said, the state
requires that the company shall not
charge more than $1.5O per month for
residence telephone and not more than
$3.50 per month for a business telephone.
On these rates. Mr.. Watson said, the
company in Oklahoma. which is the Bell
concern. declares annual dividends Of
10 2-1O per cent.
Regulation as contemplated In his re-
port, Mr. Watson told the convention.
giving proper attention to all elements
necessary to consider in determining cor
rect value, restricting capitalization to
it's true relation to investment and au-
thorizing rates which are reasonable, and
which will provide sufficient earnings to
keep the property up to full value and
pay legitimate dividends, will do much to
quiet the unrest Of the present situa-
tiOn.'
Opposed to Two Systems.
'In my state. Oklahoma, we have con-
troll over the telephone and telegraph"
Mr.. Watson said, in part ''Since the
telephone and telegraph have been placed
under our control we have used all our
energies to preventing the establishment
of two systems. for we believe two sys-
TENS to be an unnecessary burden on the
people In Oklahoma the corporation
commission regulates the rates to be
charged
In order to establish rate regulation
We had to go into the values of the prop
critics. Our commission, in order to be
just to the telephone systems. establish
ed a 10 per cent depreciation of property
standard We thought that 10 per cent
would be fair in view Of the fact that We
have in our state electrical storms which
break up the lines. In some states 10
per cent depreciation would be too much
Allowing the company an annual loss of
10 per cent on this item as one of it's
month for residence telephones and 81. so
per month for business telephones. This
gives the Bell Company, which is the
company in our state. about iO2.10 per
CcuL ulNlucuu OH tH6lT INVESTMENT. we
could possibly have made lower rate,
but this was satisfactory to the people
of the state We now have under con-
sideration the framing of a rate for long
distance service, and that will soon be
established.
Adjusting the Basis.
I'VE had to go to good deal of trou-
BILE in getting basis to fix these rates.
The effect of such regulation must event.
ually result in removing the demand of
investors for abnormal profits because of
precariousness or uncertainty of return,
in that such regulation is in itself, at
least inferentially, guarantee of the in
tegrity of investments and dividends.
1T will also remove the much-quoted
excuse for demanding speculative divi-
dends because of great risks 1t will
clear up through proper publicity and
| frank disclosure of affairs. the mystery
surrounding operation. capitalization and
profits. which is always prolific source
of Irritation, complaint and suspicion on
| the part of the public.
Finally, 1t will remove obstacles to
| the earning OF adequate rates because
such rates can be obtained through the
| approval of an intermediary in which the
public has confidence through a sense of
| representation. The great majority Of
patrons are quite willing to grant and
pay adequate rates if it can only be as
/
lightened as to the reasonableness Of the
| demand.
| Rates will thus be stripped Of all mys-
/ terry or appearance Of coercion and the
public will be satisfied that the rates are
not made merely to quench an unholy
| thirst for inordinate profits and enforced
through the generally interpreted prerog-
ative of the corporation that might
makes right :"
The report was adopted by the conyen-
| ton.
Report of Railway Committee.
The report of the committee on railway
also presented today by Clyde B. Atchi-
| gon.
| Mr.. AtchisOn said in part:
TOO often when an inspection is COM
menced word is passed along the line
and there is tendency to slick up a
| station SO that true normal conditions are
1 not disclosed. Each commission should
! have it thoroughly understood that every
member and employe is always on duty
| when he is on passenger train or about
| a station. and the Wisconsin plan of hav-
/ ing report made as to what is disclosed
| commends itself. A written report in
| sures thoroughness Of inspection which
| cannot otherwise be obtained. Your
| committee. therefore, recommends as the
best practice a combination of the
| methods of inspection in company with
| officers of the roads and the unexpected
inspection at irregular intervals by the
commission"
This report was also adopted.
Classification of Freights.
| What is declared by members of the