The Washington times., 1920-03-02

exceedingly doubtful whether the
United States Electric Lighting Com
pany had the legal right to divert
itself, without Legislative suthoriza-
tion. OF the property which II was
/ using in the public service. this at.
tempt to initiate the book value OF
| the property OF the United States
Electric Lighting Company above the
actual cost to the Power Company
and charge such increase against the
public ough. not to be permitted
from the standpoint either of law
or justice. The commission, there
fore. did aot err in refusing to count
| enance this transaction. and proper
iy disaliowed this item.
Had Net Perfected Title.
The power company also claimed
that II had a right to the allowance.
| as part of the historical cost OF it's
property. OF the sum Of 81 900, 900.
| representing what II paid In its
| stock for certain water rights al
| what IL known as the Great Falls
power site. 1t Is a significant fact
that these rights to this non-produc-
tive property were not only previous
ly acquired by the Washington Rail-
way & Electric Company and held by
II for twelve years before 1t trans
ferred them to the power company.
but that title. up to the time OF the
hearing in this case. has not been
perfected, either in that company or
| in the power company. 1t Is also
| worthy of notice that shortly before
the Public Utilities Law was enacted
the Washington Railway & Electric
Company and the power company,
| acting through identical boards Of d.
| rectors consumated transaction by
which these rights were transferred
| to the power company for $1,000 900
| of the stock of the latter company.
| This power site is located outside the
District of Columbia. 1t has never been
| used for the purpose of supplying
power to those who use electric cur
4 rent in the District of Columbia, nor
| is there a scintilla Of evidence in the
| record that 1t ever will be SO used
| by the power company.
Actual Value ProbIenatical.
Its actual value is problematical.
| and the ability of a private owner Of
power rights at this site to develop
] them IL further complicated by the
| larger Federal Governments interest
| therein. No witness who claimed to
! have any knowledge on the subject
testified as to what the value was.
For these reasons, there was no JUS
| titled theory upon which the 81 ,0OO,-
900 of stock issued for 1t by the
power company could be treated as
an actual value of 81 10000 upon
which the power company would be
| entitled to collect revenue from it's
partons in the District Of Columbia.
| The commission, therefore, did not
| err in excluding ii, either as an item
| in the historical cost of the property
| or in the reproduction cost. or in its
! finding Of fair value.
| The power company also elaine
that it had a right to have included
| in its property to be valued as q part
of it's historical cost what is known
as Graceland Cemetery. the valua-
ton claim of which was S116,155. so.
The commission excluded this prop
| erty in railway company"
Attempt to Rewrite Books.
| After citing other items claimed by
| the defendant Justice Gould con-
| tinues:
ut Is unnecessary to go into fur
| Their details with reference to the
| commissions findings OF historical
| cost. Many of the claims made by
| the power company were the result
of an apparent attempt to rewrite its
! books and charge to its capital &C.
| count items which Ii had for many
years reported to Congress as oper-
| ating expenses, and others were mere
| estimates based on some arbitrary
prcentage assumed on one or two
years operations as what might have
| overhead charges included in oper-
| ating expenses. Those claims were
| unsupported by any direct testimony
| that such expenditures had actually
| occurred, and l find no ground upon
| which the commissions conclusions
| as to these matters should be dis
| turbed.
"Conpensation to Conceivers.-
1.-THE power company claimed as an
item Of reproduction cost the sum of
$85O,00O for compensation to con-
ceivers." 1t appears from
the evidence that the power company
Is not the company which established
and developed the electric light and
power business of the District OF
Columbia. The United States Electric
Lighting Company developed this
business and at the time IL was taken
over by the Power Company, it was
the result of slow evolution from a
very small initial concern, and 1t is
exceedingly unlikely that any cost
whatsoever in the nature of a con-
ceiver's commission or a promoters
| commission attached to the enter
prise. The business was developed
slowly but successfully for fifteen
years before its acquisition by the
power company, and there Is not the
slightest evidence in the record that
any such cost was ever paid by It..
To hold that the public Is to be
charged with such an amount, which
Is a pure Pigment of Imagination, I'M
supported by any evidence. Is with.
out justification either in law or fair
dealing, which latter the public utility
owes to its patrons. The commits
sion properly disallowed this item.
Arbitrary Percentage.
an the estimate made by Almert,
the engineer of the power company,
a claim of s2.115,323 was made for
what he called development costs,
under his reproduction theory. This
figure was arrived at by applying an
arbitrary pprCentapc 10 HIS reDro-