The Birmingham age-herald., 1921-07-08

was yet being spent to rehabilitate the property.
 MT. Pevear defended the expendl- lures by the receiver, declaring there had been no extravagance. He cited the fact that, prior to the receiver ship, not exceeding 30 to 35 per ceat was spent to keep up the property. He stated the equipment was in fair physical condition in 1913 and 1911, the breakdown coming gradually n the years leading up to the receiver ship.
 Asked what steps had been
 taken toward reorganization, MT.
 Pevcnr said nothing had been
 done. The more important stock
 holders held meeting in New York
 in March. planning to bring in
 new money, following favorable
 reports In the first two months
 of the year. This action was
 killed by the down grade re-
 corded by March figures.
 MT. Johnston's comment was that they were not showing a very bold spirit toward reorganization at any rate.
 S. P. Gailliard, associate public service commissioner, asked MT. Pe- wear how much stock of the cont pany had been issued. MT. Pevear said sthe preferred stock totalled $3.500,000 and the common SS,s00,000. No dividends have been paid on com mon since he came with the company here in 1914, he said, and the gre terred stockholders have received only about 10 per cent on their money where AZ per cent is due. .
 Difficult To Borrow.
 Mir Gailliard asked why the com - pany could not borrow money. Mir. Pevear declared that the sluggish state of the bond market precluded the sale of bonds. the only means of raising money besides notes. MT. Gailliard then asked what the company had done With the net revenue left after paying these divi- dends. Mir. Pevear replied that the bonded interest and taxes had been paid with this money.
 Mir. Pevear was then asked by Mir. Johnston as to whether an intelligent fstudy of conditions and a traffic sur | they had not made any such survey. "How can you intelligently work without making close study of the situationr' de- | manded MT. Johnston. ssWhy
 should the public pay for n con- | ditiOn which has exfsted for years l prior to the recclvcrships" | Mir. Prevear declared he was try ing to work out the problems of the property.
 | Attacks Argument.
 Next MT. Johnston attacked the | agreement whereby the Alabama Power company is being paid $1s.75C | per month in excess of it's contract rate for power, under an agreement made with the company by the re- ceiver. He asked Mir. Pevear if any papers had been submitted by the power company showing the costs ot power at the time the original con tract was made. MT. Pevear replied in the negative.
 Did they consult you when they started spending money for stean i plants and new eQuipment?" MT Johnston asked.
 l No" was the reply.
 MT. Pevear stated that the com pany under the receivership was using about one-third of the entire power output of the Alabama Power company.
 It was brought out next that only s7.oo0 in receivers certificates hat l been used to buy new equipment. Current revenues are being uset | for capital expenditures and the cit, l of Birmingham has financed tn, 1 Tuscaloosa avenue work, allowing l the receiver to pay back at the rats l of approximately $20.000 per year, il 1 ten equal annual installments.
 Taxes of the local utility are no out of line compared with other util 1 ities. MT. Pevear admitted. On sixty per cent basis, the assessment Is $S.000,po0. he said.
 Mir. Johnston then stated the re ceiver and MT. Pevear had picked ou the worst month Tn the whole year il which to base their contention for higher fare. He asked why the entir five months of the year. as more in dicative of conditions. were not used