The Washington times., 1919-09-13
Continued from First Page

that eventually they would be re-
warded by dividends; that these ef-
forts greatly benefited the District
as whole, including those portions
Of Maryland and Virginia into which
they run. Most Of them paid no re-
| turns, and the public was compelled
to pay several fares in transferring
to different lines.
The failure to obtain returns
| caused the attorenys for the W. R.
and E. to strongly press claims for
| allowances Mr.. GardineE agrees
with his associates that tnearned
returns should not be allowed prior
to the enabling act which permitted
! consolidation. This consolidation, he
finds, brought about a cents fare,
and many advantages, which have
greatly aided In the development Of
| Washington.
Date Of Valuation.
The dissenting opinion hnds that
valuations should have been made
upon the basis OF the fair value OF
these properties as OF today" in
stead Of an arbitrary date, June so,
1914. All calculations and estimates
Of the majority members are based
upon the latter date except in ad-
ditions OF capital expenditures since
that time. While the majority MEM
bers, Mr.. Gardiner says, 6x the date
Of their finding as Of the present, they
admit that the values found for. 1919
| have not been increased except
through capital additions.
My learned associates concede
that pre-war prices OF labor and.
material, will never return" Mr..
| Gardiner says. ''and recognize the
theory OF q new. normal price level
on q higher plane" Mr.. Gardiner
adds: 'If, then, prices will never re-
turn to pre-wRr basis, why should
this commission hnd a value which
they concede does not represent the
property that we have before US to-
day, for which we are to determine
rate that will bring to its owners
fair return on their property as Of
today-nOt a fair return on the prop
erty as Of 1915?
Admits Current PFfeeS AbnOrmaI.
81 do not wish to be understood as
saying that I believe that the COM
pany property should be valued at
the current prices OF labor and ma
terial, which must be somewhat alb
normal do believe, however, that
we should determine as OF today
what the fair value Of this property
is, taking as q basis what we find
reproducing the property and not fix
it's fair value - Of an arbitrary date,
adding thereto such capital expendi-
lures as have been made since that
data.
81 am entirely satisfied that the
commission had a right to have all
their calculations made as OF July 1,
1914, provided they added thereto,
not only what had been expended by
the railroad by way OF capital ex-
penditures since said date, but they
should have added also the reason
able percentage Of increase which the
present day clearly shOWs Is neces-
sary in order to give as the value of
the property as OF today rather than
Of 1914
MY associates. having found that
there u an increase since 1914 per-
manent lasting inerease-ft is the
duty Of the commission TO ascertain
what percentage OF increase would
be a fair one and add that to the
value found as Of 1914 plus capital
expenditures since 1914 in order to
make the proper and fair value.
81 find that the Supreme Court
has spoken upon this subject, favor
ing such q contention, in language
so plain that IL cannot admit or
argument"
The case referred To e. that Of
Wilcox VS.. the Consolidated Gas
Company. OF New York. 212 q. S.
This same decision was referred to
by Mr.. Gardiner In the Capital Trac-
ton valuation
OPIniOn Of Justice Peckham.
Mr.. Gardiner quotes the words of
Justice Peckham. presenting the
opinion Of the court. on Page %, in
which that justice said: "And we
concur with the court below in hold
ing that the value Of the property
is to be determined as Of the time
when the inquiry is made regarding
the rates. II the property. which
legally enters into the consideration
Of the question Of rates, has in
creased in value since il was acquir-
ed, the company is entitled to the
benefits Of such increase"
Justice Peckham also stated, how
ever, that IL the increase in value
were 80 large as to render the rate
unjust to the public in any manner,
the increases should not be allowed.
Commissioner Gardiner says that
in the W. R, and (. case the increase
which should apply is an increase
which applies to all properties gen.
Mr.. Gardiner says that the Supreme
Court has PASSED upon this identical
question many times, and only re-
Gently rendered a decision in what is
known as the Minnesota rate case
He quotes the opinion delivered by
Justice Hughes in that case.
Having passed upon the matter of
the date of the valuation, is which
Mr.. Gardiner believes the majority
opinion is wrong" he passes to the
final differences between himself and
the majority-that as to franchise as
a value which should be added and
to the act Of Congress authorizing
consolidation.
Gees IRtO History.
Going into the history of the vari-
Gus independent roads before the con-
sOlidation into the W. r. & L. he
says they were in financial distress;
that the service to the public was Of
the poorest character: and the pay
ment of numerous fares necessary.
The first act OF consolidation is
that OF June 5, 1900, nineteen years
ago.
Congress, the Commissioner states,
specifically authorized certain things
to be done; these things, in the opin-
ion Of Congress, being for the benefit
OF the people of Washington The
various properties were acquired In
the manner proposed by Congress.
This being true, he asks, "have we
-