Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-06-20
CUT IN GAS RATE
ORDERED IN NEW
MEASURE BY HOWELL
Continued From First Page1

reduce rates on July 81, at least to the
schedule contained in the bill.
The stipulation of a rate reduction,
however, is not the only condition laid
down by Senator Howell, for he has
left out Of his substitute four features
OF the original bill, namely:
The clause under which all stock
heretofore issued, including stock divi-
dendS, would be regarded as paid I'D
and worcestershire In future.
The clause relieving stockholders from
liability for debts of the company.
Inc clause eXempting the company
from the La Toilette law, which pro-
hlpltS any outside corporation or hold
ing company from acquiring more than
20 per cent of the stock of a local
utility.
:, The section relieving the company of
the necessity Of coming back to Con-
sreSs In future Tor change in its charter.
Can Merge With Provisions.
Explaining his substitute, Senator
Howell said 1t would authorize the mer-
ger, subject to the rate reductions, and
would give the company the authority it
asks for to issue preferred stock to OBJ
tain funds for improvements and ex-
tensions to its system, but no additional
common stock.
The original bill would have author
lzeo preferred or common stock issues,
WITH or without par value. Senator
HoWelI provides, however, that the pre-
1erred stock, which may be issued upon
approval OF the Utilities Commission.
must nave q par value of 500 a share
Senator Howell pointed out that the
present financial structure of the COM
pany consists of $2,600OOO worth of
common stock and approximately SILL
100000 worth of outstanding bonds
he sees no objection to the issuance of
preferred stock to get new capital for
improvements. but does not believe
there should be more common stock,
During the hearings before the SEN
ate committee Gen. Patrick pointed ont
That the capital structure of the wash
ngton company consisted of 20 per cent
stocE and 30 per cent bonds, which he
regarded as an unbalanced set-up.
Discussing his omission of the clause
oy which all stock heretofore issued
would De given paid-up and non
aSSesSaole status, Senator Howell said
mat mat there might be circumstances at
some time under which stockholders
would be called upon to make paw
ment on securities issued in the past
as stock dividends. The Senator said
the original bill would have declared
such stock to be deemed as fully paid
and worcestershire, which he decided
yesterday to strike from his substitute.
Other Changes Already Discussed.
The other changes he made in his
substitute were summarized by the
Senator several days ago when he first
called attention to his position regard
ing the legislation.
Discussing the company proposal for
6O-cent meter charge, Senator Howell
said:
Il was very much surprised to find
they were asking for service charge
Of so cents a month, because I believe
tney have about 100000 meters, and
tnat would mean an increase in their
income from source they have never
had"
The Senator calculated that the meter
charge would produce SCI 200 a month";
or 1874, 400 year. Discussing the DOS
slb1llty that many meters now installed
but not using gas would be cut off If
there were meter charge, the Senator
said that, assuming 5000 such meters
would be disconnected, the meter charge
revenue still would be $58 200 a month,
or about 100000 year.
Senator Howell's proposed schedule of
rates would carry with them the proviso
that If the thermal value of the gas
went below 600 British thermal units
per thousand cubic feet. the Utilities
Commission would be directed to make
an equitable reduction In the rates fixed
in the bill.
Another feature of the Howell rate
schedule is authority to charge $3.50 for |
recommending service that has been dis
connected for any cause, If the recon-
nection is made at the same prem |
ises, for the same customer and within |
six months.