Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-03-11
new BILL AFFECTS
SALES BY UTILITIES
Kansas Legislature Votes
Restriction in MerChandis.
ing by Corporations.
BY GEORGE Y. DOYTNG.

Advocates Of legislation to prevent
public utilities from engaging In thu
merchandising business were elated
over news from Kansas that the Legis-
lature has passed and sent TO the Gov.
ernor for approval q bill to separate
merchandising from the rendering OF
utility service.
While this Is not a. strong Q MEASURE
rs Is proposed in several other States.
1t Is considered IS q step toward thH
new form OF restriction against utilities,
The sponsors Of the Kansas law ex-
planned that their purpose was to pre-
vent the possibility Of q public utility
corporation including In It's expenses,
in rate-making case, any losses in
CURED by the sales department and
thus requiring consumers to make nm
such losses through higher rates. There
IL no prohibition against sales Of an
planes through subsidiary corpora
ton.
Intent Of Measure.
The Oklahoma Senate has passed a
bill providing that public service COR
porationS shall not engage in the sale
OF merchandise not directly connected
with the general business Of the cor-
poration. This measure Is expected TO
here, viii be the first law in the United
States designed absolutely to drive pub
nc utilities from the retail sales field.
IL Is anticipated that court proceedings
VIII follow its enactment to determine
whether q gas stove or q similar ap-
phance Is mot directly connected" with
the general business authorized by the
utllitys charter. 1t has been pointed
OUT also that usually 1t Is q simple
naAtt0T n
20 as to broaden the field OF ia ac-
tivities.
In Nevada, however, Q pending LIN
Is designed to prevent appliance sales
IN any manner by public utility. The
Dill provides that mo public utility. as
denned In the public utility act. or
other public corporation, engaged In the
sale or distribution Of water, gas. cleo
tricity or heat, shall sell: trade or other
wise deal In, directly or indirectly, or
through q subsidiary corporation, any
article, commodity or appliance, ex-
cept such articles, commodities or an
planes Is may be necessary for lisa
in the conducting Of its business Is a
public utility"
Court Decision Recalled.
There has been but one major court
decision on the abstract question Of
WneOner OF not puDilc utility can do
merchandising. The Supreme Court Of
Pennsylvania held that q utility's
charter which authorized it to sell cleo
trio service necessarily implied author
ity to sell appliances to use such serv-
ice. In effect, the court held that a
utility must have power TO sell articles
tnat would result In maintaining and
promoting the consumption of the
product which the utility was estab-
liShed to SELL
The author Of bill now pending In
the Pennsylvania Legislature has sought
to overcome this obstacle by prohibiting
merchandising by public utilities even
though such goods, wares and nier-
chandise are designed and capable Of
being used in the consumption Of the
service furnished by such corporation"
This bill also undertakes to prevent a
utility corporation from continuing the
sales business through Q subsidiary.
"a (CODyright, 1870