Honolulu star-bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1912-2010, 1913-03-29
.FREAR APPLAUDED BYCIIIzENS
ASHEOFFERS FRANCHISE BILL


eF with the interest accruing 10 dis
charge the bonds at their maturity
II was made clear from the words
of the governor that he believes the
municipality will eventually own the
railway, and perhaps q fear OF the
same thing was expressed by Mr.
Peck when he stated that his main OBJ
lection to. the measure was that there
was no provision made for the safety
of the company in event the fran
chise was repealed
Oversight Pointed Out
II thought, governor he said, thai
at our lemonade conference it was
agreed that such provision should
be made"
IT was an oversight. | meant to
put it in" replied the governor.
'"Then let us put 1t in" cried Mr.
Peck in voice which reverbrated
through the chamber
Under the present franchise. said
the governor during his address. "the
company is guaranteed nothing. But
under this bill which / have just
written. the company is practically
guaranteed per cent during the life
of the franchise, and in the end viii
get back its capital invested. In
other words, 1t will get a good thing
for thirty-seven years in place Of
seventeen years, and sure thing In
place OF an uncertainty
Il provide in my bill for a sinking
fund for the redemption Of the bonds
and allow cumulative dividends at s
per cent, and / believed it necessary
to limit the amount of stock. also
provide for the purchase by the public
of the interests of the company at the
termination of the franchise. for
believe no franchise should be grant
ed without setting out what is to be
come of the property when the fran.
tchise expires. Our present law is
silent on that point.
There are two reasons why the
franchise matter should be fixed up
now. The first is that the company
must get back what 1t put in, and put
aside less in the sinking fund SO that
the public can get more extensions;
and the second is that 1t Is now q
critical time in the history of the
company, the earnings are growing
the dividends are larger, and It Is
time for the company to divide its
profits with the public. Under my
bill. half of the profits go to the
territory.
"The company may now issue
stock for all earnings over s pei
cent, and water that 25 per cent. and
It may also issue stock on all money
il may. borrow on bonds, with e5 per
cent pure water
Mr. PECK Tells Of EARLY struggles
In the reply Mr.. Peck first sketched
the history Of the company, and re
CURED to the time when horse-cai
line started along the street.
The theory of the company when
1t organized was that the property
should stand in It's cost" he said
Every dollar of profits for the first
two years went in improvements. In
1901 there was paid in by the stock
holders $245,070, and $4,000 was re
ceived from the trustees Of the Oahu
College to make an extension of ouI
line up Moana valley. We put 2i
per cent to that total, which the gov
ernor says is pure water, but It is in
the contract yes, gentlemen, it is in
the bond
at is useless for US to proceed Il
a wrong idea of the company Is te
continue, and il the people are going
to yell at the gigantic profits Of the
Company. Five per cent per annum
on the amount invested is the profit
of this company, which our books
win show.
There are some commendable feat
ures about the governors bill, bui
there are also some uncertainties We
want to be sure we are going to have
our per cent. As for the provision
against excessive salaries is con
cerned, we have no objection. There
are no large salaries on our list
Regarding the sinking fund: Il
we don't begin to put aside a sinking
fund now, our investment will BIZ
gone only scrap iron left for u.s.
so we are bound to do it, without am
stipulation in the bill requiring us to
To do that nows money which would
have gone into extesions must now
go in the sinking fund"
During his speech he called or
Richard Iyers to give some figures Il
support his statements relative to the
income of the railway and the stock
conditions.
In the course of his speech he
caused booklets to be distributed
which was in the form of a cemmuni
cation addressed TO the Advertiser
and also published in the StarBul
letin, and was in reply to some Of
the statements made by the governor
Chairman Brown asked Governor
Frear if he had any rebuttal to make
when Mr.. Peck had finished his
speech.
In clear talk of few minutes the
chief executive answered the points
Of the other Sifie and ondod with an