Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-09-29
WOOD FORCED OUT,
He SAYS ON STAND
President Reveals How Chi
cago Concern Dictated to
Washington Gas Co.


CONTINUED From First Page)
day concerning the circumstances of
his resignation, Mr. weaver said he
quit about four or five months ago.
purely of his own volition. He ex-
planned he had too much TO DO.
Mr.. Weaver declared he rendered he
resignation informally at mesting OF
the directors, without first discussing
the step with any one. He added he
never did put it in writing. He said
Mr.. PIERCE was chosen as director
about a month after he resigned.
Found Situation Changed.
Mr.. Wood said that when he was
made president of the gas company in
April, 1890. he reported to Fred S. Bur-
roughs, who was one of the bankers
who arranged the sale of the stock IN
the local company to outside interests.
About the Fall of 1890, however. Mr.
Wood said, this situation began TO
terminate" and he found himself re-
porting to Col. PIERCE and other off,
GERS Of the Central Public Service Cor
poration.
He said he understood the reason for
this was that the Central Public Serv-
ice Corporation either had an option
ON the stock of the local company or
else an obligation to find a purchaser
for it. and the corporation therefore
felt it ought to take steps to protect
its investment and make the property
attractive for prospective purchasers.
The questioning next turned to the
subject of a change in the mechanical
system of accounting, which took place
in the local company last Winter. This
was dictated by Morrison, acting under
orders from r. A. Gallagher, controller
of the Central Public Service Corpora
ton, Mr.. Wood said. The cost of the
change from one type Of machines to
another was about $4,000 year and
interest, and depreciation on that in
vestment would amount to about $4,000
a year, according to Mr.. Wood. BY
making the change, the company was
able to get rid of two clerks. whose
aggregate salary was $4,000 year.
System Declared Sound.
The testimony developed that the To-
cal company had employed firm OF
Baltimore accountants, Haskins g. Sells,
to examine its accounting system and
make periodic reports, and that such
reports were rendered in the Spring
of 1880 and again in the Spring Of 1881.
These reports were to the effect that
the then-existing accounting system was
sound.
When pressed for a reason why Mr.
Wood had consented to the change,
after he had admitted he was perfect
~ satisfied with the old system, he ex-
claimed:
Sometimes you go along with the
tide, you know, up to certain point"
Who composed the tide?" asked As
sistant Corporation Counsel William A.
Roberts, conducting the examination
for the commission.
mfr. Morrison was the immediate
man and behind him was Mr.. Gala
CHER and the Central Public Service
Corporation, of course" Mr.. Wood said.
Was Mr. Morrison not just an out
side consultant?"
HE was a consultant with far more
power than ever would give to one"
Prom whom did he get the power?"
81 finally told him how much power
he would have as long as was presi-
dent of the company"
Please answer my question, Mr..
Wood"
He got the power finally from Mr.
Gallagher, the controller Of the Central
Public Service Corporation"
| H''What right did Mr.. Gallagher have
to give him the power?"
He was the representative of large
| investment. We might as well be
frank about this thing They wanted
us to conform with their system
But you were satisfied with your
own System?"
Persuaded by Bankers.
"Our system gave me all the informa-
| ton | wanted. 1t was a good system.
| 1t was in charge of a good controller"
Then how did Gallagher persuade
| you to overturn it?"
IF there are bankers In a situation,
the bankers usually control That is
/ the usual practice in corporations. The
! Central Public Service Corporation we're
the bankers in this situation"
AT the hearing yesterday, Walter M.
Russell, chief engineer of the Washing
ton Gas Light Co., was called on for
! detailed explanations of the control ex-
| ercised over him and his departments
by the Central Public Service Corpora
/ ton.
He said when he took office In the
| Fall Of 1880, he was told the c. P S.
had small minority interest in the
| Washington property, but nobody had
a majority interest, as the stock hold
been impressed with the engineering
/ possibilities OF developing a "by-prod-
uct" gas plant for supplying Washington
with gas, probably locating the plant at
/ Alexandria. He did not know the cor
/ poration had decided to use natural
/ gas until after the contract for its pur-
/ chase had been signed, although he
knew discussions to that end we're under
way.
! Mr.. Russell said he recommended
I that the west station of the gas COM
/ pany be abandoned as a manufacturing
/ plant, except perhaps for standby pur-
poses during peak load hours, and that
( the company spend 81 900 900 (roughly)
for development of the east station as
J manufacturing plant. This plan did
not meet the approval Of Hurlburt.
Russell Plan Rejected.
After the difference Of opinion had
developed, the matter was referred to
engineers for the United Gas Improve
ment Corporation, Philadelphia con-
Germ. Those engineers prepared sew
eral plans One OF them, referred to as
plan G, followed Russell's views very
closely, and he was in favor of its
adoption, but it never was adopted
Z 1t was necessary for President Wood to
/ dictate a memorandum telling Russell
that in all future differences Hurlburt
/ was to be the last word"
Other differences were revealed in
letters TO the local company from Vice
President D. G. Mcclure of the c. p
I s., in which he suggested a plan for
firing old employees OF the company in