The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1913-04-04

issue stock FOR tho stockholders share
ne we'll as the puhlics share of the
surplus
Governor Explains
"Wo.cr, continued tho Governor
further lu the discussion. "haa been
described as n 2.u-two parts optt
mism aud one part humhug -
This brought forth laugh from tho
crowd.
"ln view of the sinister mcanipgI
which the general public gives TO tho
term 'watcrcd stock I trust the Gov.
ernor does not mean that the twenty
Eve per cont called water In the rail
way stock was secured In an unhusi.
nosslike wayln inquired President
Peck
"If it is watered stock. it is per.
fectly lcgitimatej you are entitled 20
II under the law,' replied the terri.
torial executive.
"Under their contention, - continued
Governor Frear, "they can invest their
'carnings of say 100000, of which halt
belongs to the Territory, plus twenty.
five per cent, or n million dollars, in
stock upon which they could draw
dividends.
"This seems to me to be the just
theory to proceed upon
Outlines Full Plan.
"Allow the company all II has put
in cash-$707, 500. Allow it oil it has
invested in the company up to eight
per cent. Then allow it one. half ia
excess of the eight per cent. Then
allow it to issue stock to the amount
of twenty-five per cent over all. Then
deduct one-half of the excess of these
revenues for the Territory. That would
give the company stock to the amount
of $l,425,0O
Another way of figuring would give
it $SS4,375. But allow them the high
est figure. We must look at 1t in
broad fair way. They are asking
us for franchise for thirty-seven
years instead of fourteen as at present.
They are asking us for sure thing
of eight per cent, which they do not
now have.
''Some think that franchise is
! like the laws of the Medes and Per.
sians-unchangeable All right; then
| let us look at this clause placing the
capital stock at 5000, 900. This is plain,
ly limitation, not a grant. 1t says,
| you shall not.
But there are some powers outside
of this which we still possess. There
are the police power and the taxing
| power. We do not surrender that SOW
ereignty (laughter). will read"
The Governor was interrupted here
' by President Peck who asked to see the
| authority upon which the Governor re-
lied. The book proved to be work
| by Delos Wilcox, an authority on fran.
chises, from which the Governor quot.
ed, as he said, to show that after all
the company would not be getting such
a good thing as it might expect, even
under it's franchise.
The Governor quoted from the chap.
ter on Compensation Based on Cost
Theory, or an Unfortunate Condition.
Taxation Weapon,
"There is no reason why peopll
should be allowed to grow rich on a
public franchise, and you can't do this
on six per cent" quoted the Gov
ernor. Taxation is weapon that
can be used after the franchise has
gone out of the power OF the people,,
he continued, reading from the WORK
| VI WILCOX. - II tine dartmouth College
decision will not allow you to alter
the franchise the judicious use of pc
lice regulation and taxation will bring
them to their knees.
"As | have said" concluded The
Governor, "deduct for the Territory
one-half of all the surplus after al
the expenses enumerated have beer
met. "
IF the company fails to avail Itself
OF these privileges does one-half OF
the surplus still belong to the Terri
toryY" inquired Chairman Brown.
" Under the law it does, =" answered
Governor Frear
President Peek in forceful and con
viicing manner closed the discussion
from the viewpoint of the Honolulu
Rapid Transit and Land Company.
Senator Brown, shortly before eleven
O'Clock announced an adjournment OF
the meeting until next Thursday night
at which time another effort will be
made to arrive at an understanding
1t was admitted some progress to
ward solution of the problem was
made last night, but the quest on is
still far from settled, according &C
those who have followed the discus
sion.