Evening star., 1942-03-10
P. j. {. Studies
plea 10 Issue
Gas Stock
Decision Expected at
Executive Session
This Afternoon

An urgent petition by officials Of
the Washington Gas Light Co. for
authority" to issue 10000 shares of
s425 preferred stock was taken un-
der advisement today by members
OF the Public Utilities Commission
after company representatives and
commission members debated legal
and financial issues for two and
half hours.
The commission was scheduled to
meet In executive session this aft
ernoon to decide whether to grant
or reject the request or lay down a
new policy.
The debate became heated at som.
points. Commission Chairman Greg
ory Hankin declared arguments OF
company counsel were absurd"
Commissioner James H. Flanagan
suggested the company plan might
leaVe the commission in silly DO
sltlon' and E. Barrett Prettyman,
company counsel. insisted the con-
Germ merely was trying to follow the
law and TO deal with an urgent prac-
tical situation.
FUNDS Declared Badly Needed.
The debate set forth the issue
somewhat in this fashion:
Ihat the company IA months ago
applied for permission to increase
its capitalization by issuing I'D to
$4,000 shares of the preferred stock.
that the company now is in "des-
perate" need for funds for expan-
sion and operation of its services.
due to the greatly increased demand,
and that, if the commission granted
the authority for 10000 shares. it
still would be in complete control
OF the situation, since the law re-
qulres that the specific details as to
new financial arrangements must
still be approved by the commission
Wnen definite proposals are made
Tor the actual issuance of stocks or
bonds on specified conditions.
That Chairman Hankin strongly
objected tn the view of Mr.. Prettv-
man that the commission must an
prove or deny without change the
requested authority for issuance OF
the 10000 shares, that while he rec
ognlzed the company's need for
| financing for expansion he was no,
satisfied it would necessarily be in
public interest to grant authority for
issuing 10000 shares of preferred
stock.
That Mr.. Flanagan felt that if
the commission granted the author
/ ity for 10000 shares of preferred
stock and later found some modifl-
cation was essential or that some
other method of getting financing
was better. the commission would be
left in silly position for having
granted authority for the 10000
! shares
Time Needed for Vote.
Mr.. Prettyman emphasized that
considerable time was required to
get the necessary two-thirds vote of
5000 scattered stockholders for the
increased capitalization and that he
felt sure the stockholders would not
approve an indefinite plan for in
| creased capitalization subject to
later approval by the commission, as
distinguished from the old practice
of obtaining authority first for an
issue subject to approval of the ex-
| act amounts and details on a later
action.
In this connection. Mr.. Hankin
argued that the commission should
not be expected to grant authority
for anything beyond what the i'm
mediate circumstances indicated
was necessary. Mr.. Prettyman re-
piled that if this were done, it would
remove any f1exibiity in the imam
clal possibilities of the company. If
the company found tomorrow its
immediate need we're for, say, $4,000
shares, the commission would ap-
prove only that and no more, Mr..
Prettyman declared, whereas
month later. the company stockhold-
ers might have to be asked u ap-
prove a still further increase in
capitalization, requiring still more
time.
When Mr. Prettyman protested
that other District utilities were not
subjected to this form of financial
control. Mr.. Hankin agreed this was
so but indicated that so far as he
was concerned he proposed to exer-
else that control over the gas COM
pany. because OF the difference in
its charter.