Evening star., 1932-01-22
REGULATORY LAW
MEETS COURT TEST
Wisconsin Utilities VIII Be
Forced to Pay Cost of
State Agency.
BY GEORGE E. DOEING.

For the first time since the advent oil
the modern Public Service Commission,
a high court has passed upon the matter
of compelling public utilities TO pay The
cost of their own regulation The Su-
preme Court of Wisconsin has upheld
law to that effect enacted less than a
year ago by the Legislature OF that
State
The law was attacked by the WiScon-
sin Telephone Co, to which bill had
been rendered by the commission 1or
certain expenses in connection with
Statewide investigation Of telephone
rates being conducted by the commis-
sion. In addition to a general challenge
on the part of the telephone company
to the power of the Legislature to I'M
pose upon the public utilities OF the
State the cost of their regulation, the
principal contention was that the LeglS-
iature attempted to confer legislative
mower upon the commission when 1t was
rrovided that the commission might eX-
eupt any public utility from the pay
nent of such costs if such action
Should be found to be in the public
interest.
Exemption Section.
The Supreme Court not only sus-
tanned the conStitutionality OF the act
i'm charging the investigation costs
to the utilities under scrutiny, but
held that the Legislature hao
right to authorize the commission
to make exemptions when 1t found clr-
cumstances to justify such procedure.
The court stated that the exemption
section probably was not happily
framed" to express the evident icglSla-
tive intent. but that the Legislature
doubtless had in mind such inveStga-
tiOns as might be conducted Tor the IN
formation of the commission rather
than for the direct regulation of par
ticular utility.
1T was not the legislative intent"
said the court. Ito confer upon the
public Service Commission the arbitrary
mower which resides in the Legislature
itself to determine what constitutes
nublic interest. The Legislature pos
sesses arbitrary power in Sucn matters
and may determine that to be IN me
public interest which the great majority
of the people believe otherwise. When
they so determine, there can be no
appeal. LTD 80 r,oror which
tbe legislature committed to the Public
Service Commission While it may be
that what constitutes the public interest
Is at times somewhat Intangible Ill
character, yet the Public Service Com
mission may pass reasonable luogmehL
lI1on the facts and circumstances unqer
consideration and come to reasonable
conclusion as to what the public interest,"
REQUIRES under the circumstances, ana
its conclusion is subject to judlcla!
review"
Validity of Act.
On the question of the general valid
sty of the act. the court said in part,
"Tt is a we'll settled principle mat the
cost of regulating and supervising GER
tain businesses may be imposed upon
such businesses so long as the amount
imposed does not exceed the TeasonaDle
cost of regulation and SO far as the
mower is not prostituted to the purpose
of raising general revenue. TINS IS Ihe
theory upon which license zee is eX-
acted of pawn brokers, pedoierS anG
other businesses requiring ponce ana
other governmental supervision. IL IS
the principle upon which insurance
companies are required to nay the cost
of investigation made by tie insurance
department. and upon which banks are
made to bear at least q portion OF the
expense incident TO their examinations
by the Banking Department"
(Copyright, 1922