The Marshall republican., 1914-01-16
S $5IERY BB2SNNERsH1p
The Following Address Was Made by
MIR. Hogueland Mt the Public Meet
ing Held Mt the Court House,
dee. 18th, 1913.

cuss the disadvantages OF munlclpal
ownership, not knowing anything alb
out the issues involved in Marshall.
However. a cursory reading OF the
newspapers would give N the I'M
preston that you have had quite n
discussion on this subject. II would
be impossible for me to go into the
question OF the reasonableness of the
rates in question without making an
Investigation OF the plant and its con-
dition through expert engineers and
accountants; however. there are some
fundamental propositions which !
desire to discuss with you tonight.
During my connection with the
Kansas Public Utilities Commission
of Kansas. I made quite n study OF
the laws of Wisconsin. New York and
proposed laws In other states, and
also of tie decisions of the public
service o.Emissions o: the country.
wish 10 state frankly that before
making this research I had been an
advocate OF municipal ownership o.
LEGAL utilities, but after u careful
study OF the subject and In the light
OF my experience with the Kansas
Commission, I have come to the con-
clusion that municipal ownership IN
not the proper thing for n commun-
ity except as n last resort.
There was no regulation OF public
utilities. TO speak OF, prior to 1907,
as laws giving administrative com
missions power TO regulate the rates
and service Of public utilities had not
been enacted. But Ia the year 1907
Senator La Toilette, the governor OF
the state of Wisconsin. who was ably
aided by Professor Commons, OF the
Wisconsin university. advocated and
secured the enactment OF n Law Great
ing n commission for the regulation
OF rates and service OF all public
utilities. whether publicly or private
~ owned. IN wirconsin. About the
same time, Justice Hughes. then GOV
cinor of the state OF New York
secured the enactment OF a slmila!
law In his state by which two puhll'
service cor missions, n Tor greater
New York and one for the up-stnt,
district, wore created. These com
misions were given almost unlimited
pew and authority to supervise an,
regulate the utilities,
There are perhaps four or five DIFF
ferent reasons for the general dis
content that heretofore existed In tn
minds or the people regarding publi
service corporations. In the l!rs
place. under the old regime. the utili
ties were unregulated. No powo
had been delegated to any tribuna
by the legislatures giving the peopl
the right to properly regulate theI
utilities. The New York and Wis
congin laws were radical departure
from existing statutes. and CAV III
limited power to regulate not onl
the rates and service or all utllltic
under their Jurisdiction. but ais
save the commissions power to max
physical valuations OF all utilize
and to require the keeping OF un
form accounts.
In the old Smythev. Ames rat
case. the principle was. laid dow
and has been adhered TO by practi'
ally all commissions. that public Sc
vice corporations are entitled to
reasonable return on the fair valu
of the property submitted to the pul
lie use. The commissions have hel
that capital stock and bond issu,
should not be given very much col
slderation In fixing reasonable rates
that a reasonable return should |
allowed ON the fair value OF the pr
perty, regardless Of the capital !
sues. . fshha
The Wisconsin Commission HI
laid great stress upon the neeessi
of uniform accounting, and requir
both municipality and privately oW
cd utilities to keep their accounts
a uniform manne which Is prescri
ed by the Commission. The col
mission found that none OF the uti.
ties knew whether or not they we
making money or whether the rat
charged were fair and reasonabl
The Massachusetts, commission foul
the same state of affairs.
In commenting on the regulate
of public utilities generally in a re
ent address before the Western So'
ETY. Of Engineers, Mr.. Erickson,
the Wisconsin Commission. said:
n 1T is a fact that municipality ow
ed plants need regulation fully
much and even more than prige'e
owned plants. Relatively more col