Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1920-09-10

HVluerS In Otncr cOtpOrdtlOns, ana tne Omcers
Of the underlying companies have with one
voice insisted on the sacredness Of contracts.
At recent public hearing, a Representative.
Of those companies said on the witness stand
that II the p. II. 7. were foolish enough to
make the contracts that~,was it's own look
QUIT must live up to them; a contract is a
contract; It is a kind of sacrilegc to violate
it, And yet within a few weeks Of such
assertion. we have the J.. g. l. asking the
city to relieve il Of some of the burdens Of
its contract.
II contract is sacred only to the man
who profits by it. then 1t is the duty Of the
city to turn down the petition Of the Y. q: /
and insist on its pound Of flesh. II a con-
tract can be voded or modified when one Of
the parties to II suffers, then there is no
Justification for the refusal Of the underlying
companies to reduce the rentals paid by the
P. r. 7. We cannot have a contract sacred
under one set of conditions and voidnble
under conditions exactly similar.
Under the circumstances 1t is about time
that the talk about the inviolability OF con-
tracts affected by a relation to public inter
est was stopped
As to the U. G. I. contract under which
ehO SohSuhOh Bctb Bns toE % tuousuHu
cubic feet, out Of which the gas company
pays to the city twenty five cents, It is i'm
possible for the public to know whether.
under the existing conditions, It should or
should not be revised. Coal and oil and
labor all cost many times more than they
did in 1897 when the contract was made.
No one foresaw the doubling and trebling
of prices. They have upset all calculations
made years ago.
We know that under the lease the com
pany is acting as a trustee for the public
in the manufacture and distribution Of gas.
Its revenues come from the public. includ-
ing the twenty five cents on every thousand
cubic feet which goes into the city treasury.
We know, too. that the company is entitled
to a fair return on the money II has in.
vested In the gas plant.
Now, what we need to know before any
sound opinion can be formed on the wisdom
Of granting the petition Of the company is
how great have been the profits OF the com
pany since II leased the city gas plant. How
big Is its surplus accumulated after paying
eight per cent dividends on its capital? That
there Is surplus is indicated by the state
ment Of Mr.. Bodine. the Y. G. I. president,
that the eight per cent dividends for the cur.
rent year have been paid from the accumula-
tions of past undivided earnings.
When We know these facts, the city au.
thorities will be prepared to decide how far
it will be fair to compel the company to pay
for its lean years out of the profits Of It's
fat years, and after getting the best infor-
nation Obtainable on the number Of years
that must pass before prices of all kinds
will fall to something like the pre- war level
we shall have the data on which action can
be based.
But the outstanding fact which should not
be ignored is that a contract affected by q
relation to public interest is revisable at any
time when the equities demand 1t. This Is
q rule which works both ways. 1t works
in the interest of the consuming public when
the rates charged for gas or electric light or
railroad fares or telephone rates are reduced
as they have been reduced in the past.
The principle has been established by court
decisions and In practice that the owners
Of all public service corporations are trustees
serving the public under rigid regulations
Commissions have been established by the
national and state governments to make
those regulation and to modif! them from
time to time.
This brings US TO the p r. +. and its
leases The right Of the Public Service
disputed by the underlying companies. They
have gone into court to question the hlris.
diction OF the commission, and it il their
evident determination to fight to the last
ditch against any investigation which will
put the facts on foI NAL record
They forget that they are public trustees.
They forget too-Or ignore-the fact that
the sums paid 10 them on account OF tn.
leases come from the people who ride in the
cars Of the p. Il. T., and that the rate of
fare is directly affected by the amount of
| the payments made to them.
The Public Service Commission, commits
stoned by law to regulate the transit system
| in all it's ramihcatiOns, cannot perform it's
| full duty unless Il can inquire into every
element entering into the cost of carrying
passengers on the street railroads. II in
equitable contracts have been entered into,
it must have power to examine those con
tracts or the theory of trusteeship becomes
a bowling farce.
1t may be argued that the U. G. l. Is
seeking a modification of its contract with
the city through negotiation. But even II