Perth Amboy evening news., 1920-03-30

Subsidiary corporations.
1t is obvious that much information
which ought to reach the public can
be concealed by means of corporate
action of the Public Service corpora
ton. and both receipts and disburSe-
ments cap be kept from the public
knowledge through the medium of the
holding corporation, and such receipts
and disbursements are n part of h
Information. which the Board of
Public Utility Commissioners should
have before attempting to fix a just
and reasonable rate for either of the
subsidiary companies.
The question of permitting a hold
ing company at all should be con-
sidered as a part of this problem.
4. The decision of the courts holding
that the public utility commission can
disregard municipal ordinance con-
tracts made by public utility corpora
tons appears to have created great
confusion as to the legal status and
rights of these corporations and of the
public. As these decisions are based
upon court interpretations of the
meaning of certain provisions of the
act, and no language in the act ex-
pressly sustains the courts interpret
tation, the extent to which these or
dinance contracts have been swept
away by the public utility statute or
1911 is left in doubt. and without
some action by the legislature can only
be guessed at, until future litigation
shall lead to further expressions OF
opinion by the court as to the meaning
Of the act.
Under these ordinance contracts the
public utility corporations have claim
ed and still claim perpetual rights In
the streets, and in rate cases seek to
set up and capitalize this great priv1-
lege as a property right of great
xoI,,A r., Nha ID 500 ( - oo INCA 1GPid-l
ed prior to the decision of the court,
this right under the term of fran
chise value" was appraised by the
board at one-third of the total value
of the tangible value of the property.
AS these rights In the streets were
by the state n the munich
palities IN consideration of agreements
in the ordinance contracts to
performed by the companies, such
as a limited rate of fare, special rates
for children, obligations to pave and
parts of the streets and to
remove snow therefrom, and to pay
O. percentage of gross receipts, 1t
seem to be fair that, If the
are to be relieved from
obligations under these ordi- :
contracts, 1T should be only
condition that they either sur
render to the state the privileges
which were granted to them upon the
consideration of these obligations, or
the relations between them and
public should be REDEEMED in the
form of a new agreement or in the
form of conditions to be established
on behalf of the public by the COM
missioners.
1t seems to me plain that we can
have no intelligent administration of
this utility subject until we can
establish definitely by law the extent
Of the rights and the extent of the
of both parties to the con-
troversy.
This Ia clearly a matter hat be-
longs to the province of the legisla-
ture and 1t Is its duty to devise new
legislation to remove the cloud of
uncertainty and doubt which now
surrounds and obscures this whole
branch of the subject.
5. 1t appears that In rate cases
the public utility corporations have
submitted and been allowed valua-
lions of physical n tangible prop I
erty many times the valuation con-
tended for by the same companies
and fixed by local boards of assessors
for the purposes of taxation. Our
taxing statutes require all property
to be assessed at it's true value. Ii
the true value of the present time is
to be taken by the board n by the
NCtl - to IN AhA'b oRoAA hAittAf ~ |
company is entitled to earn a fair |,
return in each case, then it is obvious
that the value for taxation and the
value for rate making should be the
same. To have the state, through
OF It's agencies, fixing the true
value of property in one proceeding
at one figure, n Their in another
proceeding, through another agency |
of the state. fixing another value |
three or four times as great, and this
discrepancy each time working to
the advantage of the corporation
concerned, tends to impair public |
confidence in the administration of
law. |
If there is to be a different value
for taxation than that adopted for |
rate making. that difference should
be defined by law.
I would suggest that the commit
tee of the Hous Of Assembly which |
has the utility legislation in charge
arrange to confer with the attorney
general for the purpose of having
him draw the necessary bills to carry
out the foregoing recommendations.