New-York tribune., 1918-07-31
80-Cent Gas Rate
In Coney District
Upset by Decision
Charles E. Hughes, as Ref.
cree, Permits Brooklyn
Co. to Charge More
New Price To Be SIPS
Gravesend and Part of Flat
bush Also Affected by
the Ruling

Charles f. Hughes. as referee, yes
terday rendered an opinion that the
statutory gas rate of 80 cents thou
sand cubic feet, now in force, is un
constitutional and void in so far as
the Brooklyn Borough Gas Company
is concerned, because the rate is confis-
catory. The new rate, which Mr..
Hughes did not prescribe, will be $1.25
thousand feet and will affect con-
sumers in Coney Island, Gravesend
and a part of Flatbush
Since the beginning of the action
now decided. which was started in
July, 1916, the Brooklyn Borough Gas
Company has been charging 95 cents
in part of this territory and 80 cents
in the rest.
In his decision Mr.. Hughes merely
permits the gas company to charge a
compensatory rate, which Edward M.
Bassctt. former Public Service Com
missioner and now counsel for the
Brooklyn Borough Gas Company, an
nounced yesterday would be $l25 a
thousand cubic feet, which he said
would enable the corporation to pay a
|
property investment and eliminate an
annual loss of $4,000.
Other Increases Possible
1t was predicted that the decision Of
Mr.. Hughes might bring similar pro-
ceedings by the Consolidated Gas Com
pany and other large purveyors of IL
| Illuminating gas in Manhattan, Brooklyn
and the Bronx, these concerns having
fought the original 80 cent law up to
the United States Supreme Court.
/ For the present, however, the find
! ings of the referee Will affect cnly
the patrons of the Brooklyn company.
Kings County Lighting Company is
still pending.
Conditions confronting the larger
Manhattan and Brooklyn companies are
different from those affecting the
! Brooklyn Borough Gas Company, for
as Mr.. Hughes pointed out in his re-
port, "the conditions of operation are
| peculiar because of the fact that the
winter population in the territory
served by the plaintiff is much less
than that of the summer, and because
of the enhanced expense of distrlbu-
tion through a district which, taken as
a whole, is still but sparsely settled"
The two points decided by Mr.
Hughes are that the S0-cent rate is
confscatory and that the 95-cent rate
does not afford the company fair re
turn on its investment. The 75-cent
rate, at which the company supplies
gas to the city, is not affected by the
decision.
Value Fixed at S1,670,492
Mr.. Hughes found that a fair valua-
tion of the plant of the Brooklyn Bor-
ough Gas Company was $1,670,4
"The court has no power to fix what
is reasonable rate" said the referee
"and the Legislature has seen fit to de-
prive the commi ission of power to af-
ford the relief to which plaintiff is en-
titled AS the plaintiff is thus left with
out adequate remedy, it is entitled tc
relief in equity from the enforcement
of the statutory rate which has super
seeded the earlier rates, so long as that
rate denies to the plaintiff fair return
for it's public service"
"The hearing before Referee Hughe:
was exhaustive, extending through the
entire year." said Mr.. Bassett yester
day. "The investment and operating
figures were analyzed, the company!
books and commission appraisals were
reviewed and the high costs of labor
coal, oil and other materials due to tn,
war we're shown. A vigorous defenc,
was made by the commission, the At
torney General and the Corporation
Counsel"
1t was said there might be an appea
by the state and city