Evening star., 1935-03-14
HOLDING FIRM ACT.
EFFECT SEEN HERE.
Two D. c. Utilities Likely to
Feel Plan Recommended
by Roosevelt,

Enactment OF FTeSldent Noooe'e"S
plan for dissolution or control OF puo-
lie utility holding corporations would
cause an upset in the control main
tanned now over the destinies OF at
least two of the District utilities.
This was the belief today OF one
local public official concerned with
regulation in the utility field here. The
expectation of an upset is based upon |
the presumption that such an act |
could be applied here effectively. Ihe
point is regarded as important, since |
all major utilities here now are under |
direction of utilities giants" despite |
the old La Toilette "anti-merger" law
forbidding foreign control"
While all details of the Presidents
obiectives have not become clear as
vet In the minds of local officials, 1t
appeared to some today the Washing
ton and Georgetown Gas Light COM
panies and the Potomac Electric
Power Co. would be definitely al
fected in so far as concerns their re-
lation to parent companies.
Existence Not Affected
The existence of the local operat-
ing companies. however. would not be
affected, in the opinion of William
A. Roberts, peoples counsel.
A glance at utility records here To-
day discloses:
That the gas companies are owned
7s per cent by the Washington d
Suburban Companies, Massachusetts,
common law trust, which represents
Mott associated
foreign" financial interests;
That the Potomac Electric Power
Co. is owned outright by the Wash
ington Railway & Electric Co., which
In turn is controlled by the North
American Co., one Of the giant utility
holding companies;
That the Chesapeake & Potomac
Telephone Co. is owned outright by its
parent company, the American Tele-
phone g. Telegraph Co.;
That the North American Co. now
owns about 58 per cent, directly or
indirectly, of the capital stock OF the
new merged street railway concern
here, the Capital Transit Co.;
Wilson Estate Owns Buses.
That the principal local bus COM
y,
Co., is owned by the estate OF Harley
p. Wilson, who bought it from the
North American Co. at time when
he was a director in that holding
company.
From the title and other terms OF
the Presidents holding company bill,
as recently written, it appeared today
to local utilities lawyers that the move
for dissolution Of holding companies
would not affect the telephone or rail-
ways companies.
The title states the purpose Of the
act to be for control of utility holding
companies and Ito regulate the trans
mission and sale of electrical energy
and natural gas in interstate and for
eign companies"
The gas company would be affected,
because of its ownership by the for
eign financial interests, it is believed
by observers, and the Washington Gas
Light Co., which owns the Georgetown
Gas Light Co., would be itself affected
to some degree because it is hold
ing company" in its own right by
ownership, indirectly of the RosSlyn
Gas Co. and through transmission of
natural gas to the District, according
to Roberts.
Buy Natural Gas.
The local gas companies buy
natural gas for transmission from the
Maryland Gas Transmission Co.,
subsidiary of the Columbia Gas and
Electric Co., holding concern. Re-
ports are that 38 per cent Of the gas
sold by the local companies is natural
gas.
The Washington Railway & Electric
Co. also was described today as a
holding company, since it owns,
through the Washington & Rockville
Railroad Co., the Braddock Heights
Light and Power Co., Inc.
District officials have been struggling
with foreign ownership for some years.
When the Public Utilities Commis-
sion act was adopted in 1913, an
amendment was added at the instance
of Senator La Toilette, ST., forbidding
any foreign or local holding company
from controlling or holding directly
or indirectly more than 10 per cent
of the stock of District utilities.
There have been several issues re-
sulting from this law, with but partial
success won by Commission officials.
After extended investigation by
Roberts, then assistant corporation
counsel, the Public Utilities Commis-
sion found in 1882 that the gas COM
panies were owned and controlled by
foreign holding company interests and
ordered this dissolved. The order was
sustained in District Supreme Court |
in December, 1882, and the case has
been kept open on the court docket. |
The result was the transfer of stock |
ownership to the Washington and |
Suburban companies, Massachusetts,
common law trust. The La Toilette
anti-merger law did not list such a
trust" among holding companies
which were barred from control of
local utilities and Commission officials
therefore accepted this status.