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Full text of "Opinions and decisions of the Railroad Commission of the State of Wisconsin"

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OPINIONS AND DECISIONS 



OF THE 



RAILROAD COMMISSION 



OF THE 



STATE OF WISCONSIN 



VOI.IJMK VI 

NOVKMBEK 11, 1910, TO JuNE 14, 1911. 



COMPILED BY 

J. M. WINTERBOTHAM 
Secretary 



MADISON, WISCONSIN 

Democrat Printing CoNfPANV. State Printer 

1912 



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MEMBERS 



OF TUB 



RAILROAD COMMISSION OF WISCONSIN 



B. H. MEYER' 
Chairman 

JOHN H. ROEMER' 
Chairman 

HALFORD ERICKSON 

DAVID HARLOWE' 



J. M. VVlNTERBOTHAM 

Secretary, 



> Reslcmod Jan. 1. 1911. 

« Elected chairman, Mar. 2, 1911. 

» TermTof office l>effan Jan. 20, 1911. 



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TABLE OF CASES. REPORTED 



Page 
Abbotsford, Vill. of, v. M. St. P. & S, S. M, R, Co., ipii. . . C19 
Train service and station facilities. 

Allen Lumber Co. v. C. M. & St. P. R. Co., ipio 14 

Demurrage charges and terminal facilities. 

Applcton Water Works Co., In re, ipio 97 

Municipal acquisition of water works, compensation for 
property. 

Argyle Tel. Co., In re Appl, ipii 617 

Telephone rates. 

Bartles-Maguire Oil Co. ct al. v. C. M. & St. P. R. Co. ct a/., 

ign 32G 

Less than carload rates on petroleum products. 

Block-Pollak Iron Co. v. C M.&St. P. R. Co., ipii. . . .205, 548 
Refund on shipment of scrap Iron. 

Bloomer El. Lt. Plant, In re AppL, i(}ii 506 

Electric rates and service. 

Bowar et al. v. C. & S. C. R. Co. et al, ipii 693 

Railway joint rates. 

Brittingham & Young Co. v. C. M. & St. P. R. Co. et al., ipn 528 
Refund on shipment of lumber. 

Brooklyn Tel. Co., In re Appl., ipii 573 

Telephone rates. 

Burns v. La Crosse Gas & El. Co. et al., igiT 195 

Removal of telephone and electric poles. 

Busivell Lbr. & Mfg. Co. v. C. M. & St. P. R. Co., iqit. ... 217 
Refund on shipment of logs. 

Cazenovia & S. C. R. Co. et al., Schmitt et aJ. v., ipii 693 

Railway Joint rates. 

Cazenovia & S. C. R. Co. et al., Schmitt et al. v., 191 1 693 

Railway joint rates. 

Chicago & N. W. k. Co. et al, Bartles-Maguire Oil Co. et al. 

v., iQTi ^. 326 

Less than carload rates on petroleum products. 

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VI CASES REPORTED. 

Chicago & N. W, R. Co, et al, Bowar et al v., ipii 693 

Railway Joint rates. 

Chicago & N, W, R. Co. et al, Brittingham & Young Co. v., 

191 1 .' 528 

Refund on shipment of lumber. 

Chicago & N. W. R. Co. et al., Lents v., ipii 581 

Train service. 

Chicago & N. W. R. Co., Listman Mill Co. v., ipii 207 

Refund on shipment of flour. 

Chicago & N. W. R. Co., McEcKhron Co. v., ipii 667 

Refund on shipments of potatoes. 

Chicago & N. W, R. Co. et al., Michel Brcunng Co. v., ipio. . 18 
Refund on shipment of beer. 

Chicago & N. IV. R. Co., Milwankce-lVaukcsha Brxi'g. Co. 

v., ipii ., 518 

Refund on shipment of beer. 

Chicago & N. IV. R, Co. ct al., Natl. Refming Co. et al. v., 

1911 326 

Less than carload rates on petroleum products. 

Chicago & N. W. R. Co., Oshkosh Fuel Co. v., ipii 222 

Refund on shipments of slabs, slab wood and cordwood. 

Chicago & N. ll\ R. Co., Picisch Iron Works v., ipii 510 

Refund on shipment of structural Iron. 

Chicago & N. IV. R. Co. et al., Pulpwood Co. of Applcton v., 

1910 175 

Refund on shipments of pulp wood. 

Chicago & N. IV. R. Co. ct a!., .Schmitt v., 1911 603 

Railway joint rates. 

Chicago & N. IV. R. Co. ct al., JVis. Pulp & Paper Mfrs. v., 

IQTI 436 

Group rates on coal. 

Chicago & N. IV. h\ Co., ]\T:i'kcx-HisscI Lumber Co. 7'., loio 21 
Refund on shipments of lumber. 

Chicago & N. IV. R. Co., Va-u^key-Bissel Lbr. Co. 7'.. 70/ r. . 2(»0 
Refund on shipments of lumber. 

Chicago, B. & Q. R. Co. et al, Bartles-Maguire Oil Co. et al. 

v., 1911 326 

Less than carload rates on petroleum products. 

Chicago, B. & Q. R. Co. et al, Natl. Refining Co. et al v., 

jQii : 326 

Less than carload rates on petroleum products. 



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CASES REPORTED. Vll 

Chicago, M, & St P. R. Co,, Allen Lmnber Co, v., ipio, ..... 14 
Demurrage charges and terminal facilities. 

Chicago, M, & St. P. R. Co, et al., Bartles-Maguirc Oil Co. 

et aL v., 191 1 32G 

Less than carload rates on petroleum products. 

Chicago, M, & St P. R. Co., Block-Pollak Iron Co. v., 

ipii 20.5, 548 

Refund on shipment of scrap iron. 

Chicago, M. & St. P. R. Co. ct al, Brittingham & Young Co. 

v., 191 1 528 

Refund on shipment of lumber. 

Chicago, M. & St. P. R. Co., Bum'c.l Lbr. & Mffj. Co. v., 

1911 217 

Refund on shipment of logs. 

Chicago, M. & St. P. R. Co. ct a!.. Hall v., 1910 23 

.Station facilities. 

Chicago, M. & St. P. R. Co., ffaiccs z'., iQir 505 

Station facilities. 

Chicago^ M. & St. P. R. Co., llomstad ct al. v., i()W 1 

Station facilities. 

Chicago, M. & St. P. R. Co., Kronskop 7'.. jqio ITS . 

Refund on shipment of rye. 

Chicago, M. & St. P. R. Co., Krouskop v., tqio 181 

Refund on shipment of lumber and reduction of rates. 

Chicago, M. & St. P. R. Co., Laun v., wio 5 

Train service. 

Chicago, M. & St. P. R. Co. ct al., Lcntc v., iqii 581 

Train service. 

Chicago, M. & St. P. R. Co. ct a\, Mcmislia Paper Co. v., 

iQii 58G 

^ Refund on shipment of wood pulp. 

Chicago, M. & St. P. R. Co., Morse v., ion 531 

Refund on shipment of coal. 

Chicago, M. & St. P. R. ,Co. ct at, Nafl. Rcfimng Co. ct a/. 

v., 1911 326 

Less than carload rates on petroleum products. 

Chicago, M.&St. P. R. Co., Oshkosh Fuel Co. v., ipn 199 

Refund on shipments of fuel wood and on shipment of 
slabs. 

Chicago, M. & St. P. R. Co., Phelps v., 191 1 550 

Switch connections. 



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VI 11 CASES REPORTED. 

- 

Chicago, M. & St. P. R. Co. ct ai, Storch v., ipii GG3 

Station facilities. 

Chicago, M. & St. P. R. Co., Strasburg v., i^ii 504 

Tiain service and station facilities. 

Chicago, M & St. P. R. Co., Titus v., i^ii o31 

Train service. 

Chicago, M. & St. P. R. Co., Town of Hubbard v., it^io. . . . 128 
Railway grade crossings. 

Chicago, M.&St. P. R. Co., Town of Hubbard v., ipii 072 

Railway grade crossings. 

Chicago, M. & St. P. R. Co., IVhcclcr-Timlin Lbr. Co., ipii. . 431 
Refund on shipment of lumber. 

Chicago, M. & St. P. R. Co. ct al., Jl'is. Pulp & Paper Mfr's. 

v., 1(^11 43G 

Group rates. 

Chicago, St. P. M. & O. R. Co. ct a .. Bartlcs-Maguirc Oil Co. 

ct al. v., iQii 32G 

Less than carload rates on petroleum products. 

Chicago, St. P. M . & O. R. Co., La Crosse Heater Power Co. 

v., 1(^10 173 

Refund on shipment of construction material. 

Chicago, St. P. M. & O. R. Co., Michel Brewing Co.7\, iqio 18 
Refund on shipment of beer. 

Chicago. St. P. M. & O. R. Co., Roddis Lbr. & J'eneer Co. 

vs., jQii 571 

Refund on shipment of logs. 

Chicago, St. P. M. & O. R. Co., Superior Crushed Rock Co. 

v., wii 21!) 

Refund on shipment of crushed stone. 

Chicago, St. P. AL or (). R. Co.. J^audreuil Realty Co. v., 

jgn GGl 

Spur track. 

Chicago, St. P. M. & O. R. Co., Jl'ing & Gefts v., iqti G25 

Concentration rates established. 

Connor ct al. v. Marsh ct al., jqii 589 

Telephone rates, extra charges for long distance connec- 
tions. 

Curtiss, Vill. of, v. M., St. P. & S. S. M. R. Co., ign G55 

Train service and station facilities. 

Darlington, City of, Kirwin et al. v., iqto 2G, 408 

Water rates and installation of meters. 



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CASES REPORTED. IX 



Diuluth, S, S. & A. R. Co. et ai, Bartles-Maguirc Oil Co. v. 

ipii 32G 

Less tban carload rates on petroleum products. 

Diiluth, S. S, & A, R. Co. et ai, City of Superior v., ipii. . . (i7 1 
Railroad crossing, viaduct. 

Diiluth-Siiperior Milliiu^ Co. et ai v. N. P. R, Co., igio 70 

Switching service, whether inter or intrastate. 

Durand Lt. & Pr. Co., In re Appl, ujti X\\ 

Electric rates. 

IT^ci^irht Equity Produce Co. r. M. St. P. & S. S. M. A^ Co., 

ipll 501 

Spur track, construction ordered. 

Roirle River Lt. & VV. Co., In re AppL, ion 521 

Electric rates. 

Eastern Wis. R. & Lt. Co., Lamb v., ion 17:{ 

Interurban railway rates and fare zones. 

Evamvilie Tel. Exch., In re AppL, wii (i07, 0.39 

Telephone rates and regulations 

Ele^^a Farmers Tel. Co., In re AppL, ipir 211 

Telephone rates. 

Equitable El. Lt. Co., City of Lake Cene^uj v., iqit 203 

Electric rates, meter rental. 

Green Bay & \V. R. Co. et al., Bartles-Mairuire Co. et al v., 

iQii 320 

Less than carload rates on petroleum products. 

Green Bay & W. R. Co. ct a!., Natl. Reiiniiii^ Co. et al. v., 

ion 32(5 

Less than carload rates on petroleum products. 

Green Bay & Western R. Co. et al., IT is. Pulp dr Paper 

Mfrs. v., IQIT 430 

Group rates on coal. 

Greenwood Mun. Lt. Plant, In re Appl., loio Gl 

Electric rates. 

Gross et al. v. IVis. Tel. Co., iqii 432 

Telephone rates from hotel rooms. 

Hallv. C. M. & St. P. R. Co. et al., ipio 23 

Station facilities. 

Hallv. M. St. P. & S. S. M. R. Co., ipio 23 

Station facilities. 

Harrington et al, v. T. M. E. R. & L. Co., lOio fil 

Electric power rates. 



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X CASES REPORTED. 

Hawcs V. C. M. & St. F. J?. Co., ipii 565 

Station facilities. 

Heaverin v. M. St. P. & S. S. M. R. Co., 19 ii 52G 

Station facilities. 

Hicstand et al. v. So. Wis. Ry. Co. of Madison, iqio 1G2 

Street railway service. 

Homstad et al. v. C. M. & St. P. R. Co., ipio 1 

Station facilities. 

Hubbard, Tozm of, v. C. M. & St. P. R. Co., 19 10 128 

Railway grade crossings. 

Hubbard, Tozm of, v. C. M. & St. P. R. Co., 19 11 G72 

Railway grade crossings. 

Illinois C. R. Co. ct a/., Bartlcs-Mai!:mrc Oil Co. ci al. v., tqtt :\26 
Less than carload rates on petroleum products. 

In re Appleton Water Works Co., 1910 97 

Municipal acquisition of water works, compensation for 

property. 

In re Appl. Argyle Tel. Co., jQir G17 

Telephone rates. 

In re Appl. BlOomer PA. Lt. Plant, 1911 HOG 

Electric rates and service. 

In re Afpl. Brooklyn Tel. Co., iqii tu'^ 

Telephone rates. 

In re Appl. Diirand Lt. cr Pr. C \k, rcji i :]o4 

Electric rates. 

In re Appl. liai^le Rirer Lt. c'V W. Co.. ion 521 

Electric rates. 

In re Appl. liieva Panners Tel. Co., ion 211 

Telephone rates. 

In re Appl. Evansville Tel. Pxeli., ion GOT 

Telephone rates and regulations 

In re Appl. Evansville Tel. R.reh., ion 639 

Telephone rates. 

In re Appl. Creemi*ood Muu. Lt. Plant, TQro Gl 

Electric rates. 

In re Appl. Interurban Tel. Co., toio 187 

Telephone rates. 

In re Appl. Interurban Tel. Co., ion G47 

Telephone rates and service. 

In re Appl. Lancaster PL Lt. Co., 1010 53 

Electric rates. 



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CASES REPORTED. XI 



In re AppL Manitowoc & Northern Traction Co,, ipii, .... 395 
Interurban railway rates. 

In re AppL Milton and Milton Jet. Tel. Co., ipii 542 

Telephone rates. 

In re AppL Mt, Horeb El. Lt, Co., ipio 44 

Electric rates. 

In re Appl. Red Cedar Valley El. Co., ipii 717 

Electric rates. 

In re AppL Troy and lioney Creek Tel. Co., ipii 549 

Telephone rates. 

In re AppL Wautoma & Mt. Morris Farmers' Tel. Co., ipii. . 419 
Telephone rates. 

In re Investigation of La Crosse & O. St. P. Co., ipio 124 

Street railway service and station facilities. 

In re Lake Geneva IV. & Lt. Co., 191 1 403 

Municipal acquisition of water works, compensation. 

Interurban Tel. Co,, In re AppL, ipio 187 

Telephone rates. 

Iftterurban TeL Co., In re AppL, ipii G47 

Telephone rates and service. 

Kaufman & Co. v. W. & N, R. Co., ipii 497 

Refund on shipment of salt. 

Kcivaunce, G. B. & IV. R. Co. et aJ., Bartles-Ma^nire Oil Co. 

et al., v., 1911 320 

Less than carload rates on petroleum products. 

Kimw et aL v. City of Darlington, 1910 2G 

Water rates and installation of meters. 

Kinvin et aL v. City of Darlington, rcjir 408 

Water rates and installation of meters. 

Kronskop v. C. M. & St. P. R. Co., iqio. 178 

Refund on shipm<qit of rye. 

Kronskop v. C. M. & St. P. R. Co., lorn ISl 

Refund on shipment 'of lumber and reduction of rates. 

La Crosse & O. St. Ry. Co., In re Investigation of, kjio. . . 121 
Street railway service and station facilities. 

La Crosse & S. E. R. Co. et aL, Bartles-Maguire Oil Co. et 

al. v., iQii , 326 

Less than carload rates on petroleum products. 

La Crosse & S. E. R. Co. et aL, Natl. Refining Co. et aL ?'., 

191 r 32G 

Less than carload rates on petroleum products. 



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Xll . CASES REPORTED. 

La Crosse Gas & EL Co, ct ai, Burns v., ipii 195 

Removal of telephone and electric poles. 

La Crosse Tel. Co. et al.. Burns v., ipii. . . ., 195 

Removal of telephone and electric poles. 

La Crosse Water Pou*er Co. v. C. St. P. M. & 0. K. Co., 

•jpio 173 

Refund on shipment of construction material. 

Lake Geneva, City of, v. Equitable El. Lt. Co., ipii 203 

Electric rates, meter rental. * 

Lake Geneva IV. & Lt. Co., In re., ipii 403 

Municipal acquisition of water works, compensation. 

Lake Superior T. & Tr. R. Co. et al., City of Superior v., 

1911 074 

Railroad crossing, viaduct. 

Lamb v. Eastern Wis. R. & Lt. Co., ipii ; . 473 

Inter urban railway rates and fare zones. 

Lancaster El. Lt. Co., In re Appl., ipio 53 

Klectric rates. 

Laun V. C. M. & St. P. R. Co., ipio. . . ., 5 

Train service. 

Lebanon, Town of, (Dodge Co.), Mike., Sparta & N. W. R, 

Co. v., ipii , 424 

Railroad crossing. 

Lentc v. C. M. & St. P. R. Co. et al., ipii 581 

Train service. 

Listman Mill Co. v. C. & N. W. R. Co., iqtf 207 

Refund on shipment of flour. 

McEachron Co. v. C. & N. W. R. Co., ipii. 007 

Refund on shipments of potatoes. 

Manito7i*oc & Northern Traction Co., In re AppL, tqh 395 

Inter urban railway rates. 

Marsh et al., Connor ct al. v., i<)it 589 

Telephone rates, extra charges for long distance connec- 
tions. 

Menasha Paper Co. v. C. M. & St. P. R. Co. et aJ., iqti 580 

Refund on shipment of w^ood pulp. 

Michel Brezving Co. v. C. & N. W. R. Co. et al., ipio 18 

Refund on shipment of beer. 

Milton and Milton Jet. Tel. Co., In re AppL, iqtt 542 

Telephone rates. 



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CASES REPORTED. XUl 

Milumikec E. R. & L. Co., The, Harrington ct al. v., i^io. . . 64 
Electric power rates. 

Milzv,, Sparta & N. W, R, Co: z\ Totvn of Lebanon (Dodge 

Co.), ipii 424 

Railroad crossing. 

Mikmukee-Waukesha Bnvg. Co. v. C. & N. W. R, Co,, 1911 518 
Refund on shipment of beer. 

Minneapolis, St, P. & S, S. M. R. Co. et al., Bartles-Maguire 

Oil Co. et al. v., ipii 32() 

Less than carload rates on petroleum products. 

Minneapolis, St. P. & S. S. M. R. Co., Dzinght Equity Pro- 

duee Co. v., ipii 501 

Spur track, construction ordered. 

Minneapolis, St. P. & S. S. M. R. Co., Hall v., ipio 23 

Station facilities. 

Minneapolis, St, P. & S. S. M. R. Co., Heaverin v., ipii 526 

Station facilities. 

Minneapolis, St. P. & S. S. M. R. Co. et al., Memsha Paper 

Co. v., ipii 58(5 

Refund on shipment of wood pulp. 

Minneapolis, St. P. & S, S. M. R. Co., Morton Salt Co. v., 

191 1 499 

Refund on shipment of salt. 

Minneapolis, St. P. & S. S. M. R. Co., Oshkosh Fuel Co. v., 

ipn 669 

Refund on shipment of wood. 

Minneapolis, St. P. & S. S. M. R. Co., Phoenix Wall Paper 

Mfg. Co. v., 1910 , 182 

Refund on shipment of print paper. 

Minneapolis, St. P, & S. S. M. R. Co. et ai^Pitlpwood Co, of 

Appleton v., 1910 175 

Refund on shipments of pulpwood. 

Minneapolis, St. P. & S. S. M. R. Co., Stan:: Co. r., 79// 579 

Refund on shipment of cheese. 

Minneapolis, St. P.S-S. S. M. R. Co. etal, Storch v., 1911. , 663 
Station facilities. 

Minneapolis, St, P, & S. S. M, R. Co., Vill, of Abbots ford v., 

19TT 619 

Train service and station facilities. 



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XIV CASES REPORTED. 

Minneapolis, St, P. & S, S. M. R. Co., Vill of Curtiss v,, 

191 1 .^ 655 

Train service and station facilities. 

Morse V, C. M. & St. P. R. Co., 191 1 ' 531 

Refund on shipment of coal. 

Morton Salt Co. v. M. St. P. & S. S. M. R. Co., 19 11 499 

Refund on shipment of salt. 

Mt. Horeb El. Lt. Co., In re Appl, 19 10 44 

Electric rates. 

National Rciining Co. ct al. v. C. & N. JV. R. Co. ct al., 1911 33G 
Less than carload rates on petroleum products. 

Nccmh, City of, v. IVi^. Tr. Lt. H. & P. Co. ct al., 1911. .398, G90 
street railway rates. 

Northern P. R. Co. ct a!., City of Superior v., 191 1 G74 

Railroad crossing, viaduct. 

Northern P. R. Co., Duluth-Supcrior Milling Co. ct al. v., 

1910 70 

Switching service, whether inter or intrastate. 

Oshkosh Fuel Co. v. C. &N. IV. R. Co., iqii 222 

Refund on shipments of slabs, slab wood and cordwood. 

Oshkosh Fuel Co. v. C. M. & St. P, R. Co., iqii 199 

Refund on shipment of fuel wood and on shipment of slabs. 

Oshkosh Fuel Co. r. M. St. P. & S. S. M. R. Co., 191 1 6G9 

Refund on shipment of wood. 

Phelps V. C. M. & St. P. R. Co., 1911 556 

Switch connections. 

Phoenix Wall Paper Mfi^. Co. v. M. St. P. & S. S. M. R. Co., 

1910 182 

Refund on shipment of print paper. 

Pietseh Iron Works v. C. & N. IV, R. Co., iqii 540 

Refund on shipment of structural iron. 

Piilpiifood Co. of Appleton v. M. St. P. & S. S. M. R. Co. ct 

al., 1910 175 

Refund on shipments of pulpwood. 

Racine, City of, v. Racine Gas Lt. Co., 191 1 228 

Gas rates. 

Racine Gas Lt, Co., City of Racine v., 1911 228 

Gas rates. 

Red Cedar Valley EL Co., In re Appl, 191 1 717 

Electric rates. 



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CASES REPORTED. XV 



Rockford & I. R, Co., Schickcr v., ipii G95 

Interurban railway rates. 

RoddisLbr. & Veneer Co. v. C. St. P. M. & O. R. Co., 191 1. . 571 
Refund on shipment of logs. 

Schkker v. Rockford c9 /. R. Co., 191 1 695 

Interurban railway rates. 

Schmitt et al. v. C. & S. C. R. Co. ct al, 191 1. 693 

Railway joint rates. 

Sheboygan, City of, v. Sheboygan Ry. & III. Co., 19 11 353 

Electric rates and service, street lighting. 

Sheboygan Ry. & El. Co., City of Sheboygan v., ipii 353 

Electric rates and service, street lighting. 

Southern IVis. Ry. Co. of Madison, Hiestand et al v., 19 10, . 163 
Street railway service. 

Stanz Co. v. M. St. P. & S. S. M. R. Co., ipii 579 

Refund on shipment of cheese. 

Stevens Point, City of, v. Stezrns Point IVater Co., ipii. . . . 458 
Water rates and service. 

Stevens Pohnt Water Co., City of Stevens Point v., ipii. . . . 458 
Water rates and service. 

Storch V. C. M. & St. P. R. Co\ et al., 191 1 663 

SUtlon facilities. 

Strasbiirg v. C M. & St. P. R. Co., iqii 504 

Train service and station facilities. 

Snt>erior, City of, v. N. P. R. Co. et al., iqii 674 

Railroad crossing, viaduct. 

Superior Crushed Rock Co. v. C St. P. M. & O. R. Co., 19 11 219 
Refund on shipment of crushed stone. 

Superior Terminal Elevator Co. et al. v. N. P. R. Co., 1910. . 70 
Switching service, whether inter or Intrastate. 

Titus V. C. M. & St. P. R. Co., 1911. 534 

Train service. 

Troy and Honey CreeJ; Tel. Co., In re AppL, 191 1 549 

Telephone rates. 

Vaudreuil Realty Co. v. C. St. P. M. & 0. R. Co., 19 11 6pl 

Spur track. 

Washburn, City of. v. Washburn W. Wks. Co., 19 10 74 

Water rates and installation of meters. 

Washburn W. Wks. Co., City of Washburn v., 1910 74 

Water rates and installation of meters. 



Digitized by VjOOQIC 



XVI • . CASES REI'ORTED. 

ll'autotna & Mt. Morris Farmers' Tel. Co,, In re AppL, ipii 419 
Telephone rates. 

IV heeler-Timlin Lbr. Co, v. C M. & St. F. R. Co., 191 1, . . . 434 
Refund on shipment of lumber. 

IVhitezcater, City of, v. JVhitezcatcr EL L. Co., ipio V\2 

Electric service. 

IVIiitewater El. L. Co., City of IVIiitczcater v., kjio 1353 

Electric service. 

Wing & Getts v. C. St. P. M. & O. R. Co., 19 11 025 

Concentration rates established. 

Wisconsin & Mich. R. Co. ct ah, Bartlcs-Maguire Oil Co. 

et al. v., ipii 32G 

Less than carload rates on petroleum products. 

H^isconsin & N. R. Co., Kaufmann & Co. v., 191 1 497 

Refund on shipment of salt. 

Wisconsin Cent. R. ct al., Wis. Pulp & Paper Mfrs. ZK. 191 1 . . 43G 
Group rates on coal. 

Wisconsin El. Ry. Co. ct al.. City of A^eenah v., 191 1 . . . .398, (i9() 
Street railway rates. 

Wis. Pulp & Paper Mfrs. v. C. & X. W. R. Co. et ai, 1911. . Um 
Group rates on coal. 

Jl'isconsin Tel. Co. et al., Connor et al. z\, iqii 589 

Telephone rates, extra charges for long distance connec- 
tions. 

Wisconsin Tel. Co., Gross et al. z'., jqti 432 

Telephone rates from hotel rooms. 

Wise on in Tr. J A. II. & P. Co. ei al., city of Xeenali^^ z\, 

IQII 398, f)90 

Street railway rates. 

Wrwkey-Bisscl Lbr. Co. v. C. c'r X. W. R. Co., 1910 21 

Refund on shipment of lumber. 

Yazckey-fhssel Lbr. Co. v. C. & X. W. R. Co., rgrr 209 

Refund on shipments of lumber. 



Digitized by VjOOQIC 



TABLE OF CASES CITED. 



Appleton V. Appleton W. Wks. 

C6., 1010. 5 W. R. C. R. 215. 

228-235. 275, 276 - - - 

- - - - 102. 120, 122, 

Ashland v. Ashland Water Ck)., 

1909, 4 W. R. C. R. 273, 282. 

307 

94, 95, 



PAOB 



99 
238 



82 
122 



Block-Pollak Iron Ck). v. C. M. 

& St. P. R. Co., 1911, W. 

K. C. R. 205 - - - . 548 
Brunswick, etc. Water Dist. v. 

Maine Water Ck)., 1904, 99 

Me. 371 120 



Central Stock Yards Co. v. 

I^uisville & N. R. Co., 1902, 

118 Fed. 113 ... - 
Church V. Minn. & St. L. R. 

Co., 1901, 14 S. Dak. 443 - 
Cochrane & Co. v. C. M. &St. 

P. R. Co., 1908, 3 W. R. C. 

R. 1 

Commercial Club etc. v. So. 

Pac. R. Co. etaL, 1907, 12 I. 

C. C. R. 495 .... 

Dick et al v. Madison Water 
Commissioners, 1910, 5 W. 
li. C. R. 731 - . - . 

Dyer v. C. M. & St. P. R. Co., 
1908, 2 W. R. C. R. 621 
...... 12, 

Elbortson v. C. St. P. M. & O. 
R. Co., 1908, 2 W. R. C. R. 
593, 602 

Farmer v. D. S. S. & A. R. Co., 

1907, 1 W. R. C. R. 316 
Farmers' Store Co. v. C. St. P. 

M. & O. R. Co., 1908, 3 W. 

R. C. R. 42, 50 - - . . 
Field V. M. K. & T. R. Co.. 

1897, 42 S. W. 362 - - . 



71 
435 



636 



71 



94 

11 
623 



443 



12 



197 

71 



Galena Water Co. v. Qalena, 

1906, 87 Pac. 735 - - - 120 



PAQIB 

Gloucester Water Supply Co. 

V. Gloucester, 1001, 179 Mass. 

365 120 

Gulf, C. & Santa Fe R. Co. v. 

Hefly, 1895, 158U. S. 98 - 435 
Gulf, C. & Santa Fe R. Co. v. 

Texas, 1907, 204 U. 8. 403 - 70 

71 

Herndon v. C. R. I. & P. R. 

Co., 1910, 218 U. S. 135 - - 623 
Hill et al. v. Antigo Water Co., 

1909, 3 W. R. C. H.623, 711, 

712, 715, 716 - - - - 278 

279 

Homstad v. C. M. & St. P. R. 

Co., 1907, 2 W. R. C. R. ^ 2 

Ideal Lumber & Coal Co. v. C. 

M. & St. P. R. Co., 1909, 4 

W. R. C. R. 171 - - - 680 
In re Appl. Cumberland Mun. 

El. Lt. Plant. 1900, 4 W. R. 

C.R.214, 222 - - - - 342 
In re Appl. Madison City W. 

Wks., 1909,3W.R.C.R.299 94 
In r« Appl. Stou^h ton Mun. El. 

Lt. System, 1909, 3 W.R.C. 

R. 484, 490 49 

In re Cashton Lt.& P. Co.. 

1908. 3 W.R.C. R. 67, 83, U 

84—95 118 

120 

In re Investigation Hudson W. 

Wks., 1908, 3 W. R. C. R. 

138, 141, 145 . - - . 92 
In re Menominee & Marinette 

Lt.& Tr.Co., 1909, 3 W.R. 

C.R. 778 49 

In re Standards for Gas & Elec. 

Service, 1908, 2 W.R. C. R. 

632 323 

Interstate C.C.V.C.B.& Q.R. 

Co., 1902, 186 U.S. 320 - - 71 

Kenfield & Lamoreaux v. C. 

St.P.M.A O.R.Co., 1910. 4 

W.R. C.R. 465 - - . - 206 
Kennebec Water Dist. v. City 

of Waterville, 1902, 97 Me. 

185 120 



Digitized by VjOOQIC 



XVIU 



CASES CITED. 



Kirwin et al. v. City of Dar- 
lington, 1910. 6 W.R.C.R. 
26, 43 - - - - . - 



FAGB 



408 



La Crosse Water Power Co. v. 
C.St.P.M.&O.R.Co., 1910, 
4 W.R.C.R. 412 - - - 174 

Laning- Harris Coal etc. Co. v. 
A. T. & Santa Fe R. Co., 1907, 
12I.C.C.R. 479 - . - 71 

Loft us- Hubbard Elevator Co. 
v.W.C.R.Co.,1906, IW.R. 
C.R.91 672 



McNeill v.So.R.Co., 1906,202 
U.S. 543, 559 - - - - 71 

Manitowoc v. Manitowoc & 
Northern Tr.Co., 1911, 145 
Wis. 13, 29—30 - - - - 400 

Menasha Paper Co.v.C. M. & 
St.P.R.Co.^^a^., 1909, 3 W. 
R.C.R.620 183 

Merrill W^oodenware Co. v. C. 
M.&St.P.R.Co., 1908,3 W. 
R.C.R.54, 56 - - - - 217 
- 435 

Milwaukee- Waukesha Brew- 
ing Co.v.C. & N.W.R. Co,. 
1910. 5 W.R.C.R. 546 - 518,519 

Minneapolis Thrashing Ma- 
chine Co. v. Omaha R.Co., 
1909,17 1. C.C.R. 189 - - 71 

Minneapolis St. P. its. S.M.R. 
Co. V. Railroad Commission, 
1908, 136 WMs. 146, 167, 168 - 569 

Missouri K. & T. R. Co. v. 
Bowles 1897, 1 Ind . Ter . 250 - 435 

Missouri K. & T. R. Co. v. 
Love, 1910, 177 Fed. 493 - 
120, 121 

Missouri Pacific R.Co. v. Lara- 
bee Flour Mills Co., 1909, 211 
U. S. 612 70 



National Travelers Associa- 
tion V. Wis. Tel. Co. et al. , 
1910, 5 W, R. C. R. 678 - - 432 

National W. Wks. Co. v. Kan- 
sas City, 1894, 62 Fed. 853, 
864 - - - _ _ _ - 120 

Neenah v. Wis. Tr. Lt. H. & 
P. Co.. 1910, 4 W. R. C. R. 
471, 476 402 

Newbury port Water Co. v. 
Newburyport, 1897, 168 
Mass. 541 120 



FAGB 

New York ex rel. Penn R. Co. 
v. Knight, 1904, 192 U. S. 

21 7a 

IZ 

Noble et al. v. C. St. P. M. & 
O. R. Co., 1907, 1 W. R. C. 
R. 767, 775 444 

Norwich Gas & Elec. Co. v. 
Norwich, 1904, 76 Conn. 565 12a 

Omaha v. Omaha Water Co., 
1910, 30 Sup. Ct. Rep. 615— 
620 120. 

Pabst Brewing Co. v. C. & N. 

W. R. Co., 1909, 4W. R. C. 

R. 173 68a 

Poor Grain Co. v. C. B. & Q. 

R. Co. et al., 1907, 12 I. C. 

C. R. 418 435 

Pulp and Paper Mfrs. of Wis. 

V. C. & N. W. R. Co. et al., 

1908, 2 W. R. C. R. 108 - - 175 

Rhodes V. Iowa, 1898, 170 U. 
S. 412 ... - - - - 71 

Ripon V. Ripon Lt. & Water 
Co., 1910, 5 W. R. C. R. 1, 
10, 14, 80, 86 - - - - 29 
- - - - 40, 141,241, 36a 

Savannah F. &. W. R. Co. v. 
Bundick, 1894, 94 Ga. 775 - 435^ 

Spring Valley W. Wks. v. 
City, etc. of San Francisco 
et al., 1903, 124 Fed. 574, 
594 120 

State of Mo. v. A. T. & S. F. 

R. Co., 1903, 176 Mo. 687 - 71 

State ex rol. Duluth v. St. P. 
& D. R. Co., 1899, 75 Minn. 
473 685. 

State Journal Prtg. Co. v. Mad- 
ison Gas & Elec. Co., 1910, 4 
W. R. C. R. 501, 540-546, 
56a-587, 588, 589 - - - 243 
278, 285^ 

Steven & Jarvis Lumber Co. 
V. C. St. P. M. &0. R. Co., 
1907, 2 W. R. C. R. 131 - - 206 

Texas and Pac. R. Co. v. 

Mugg, 1906. 202 U. S. 242 - 435- 
Tinkham v. C. & N. W. R. Co. 

et al., 19.9, 4 W. R. C. R. 

329, 330 200 

U. S. v. Colo. & N. W. R. Co. 

1907, 157 Fed. 821 - - - 7a 
U. S. v. Union Stock Yards 

Co. 1908, 161 Fed. 919 - - 71 



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CASES CITED. 



XIZ 



PAGE 

Teneer Co. v. Urbana W. Wks., 
1900, 174 Fed. 348-352 - - 120 

Webb Produce Co. v. C. & N. 

W. R. Co., 1908. 3 W. R. C. 

R. 32. 636 

West Texas Fuel Co. v. Texas 

& Pac. R. Co., 1909, 16 I. C. 

O. R. 443 71 



PAGH 

West Texas Fuel Co. v. Texas 

& Pac. R. Co., 1910, 17, J. C. 

C. R. 491 71 

Wis. Retail Lbr. Dealers Ass*n 

V. C. & N. W. R Co. et al. 

1909, 3, W. R. C. R. 471, 589 529 
Wrig-ht Lumber Co. v. C. M. & 

St. P. R. Co., 1910, 4, W. R. 

C. R. 770 206 



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TABLE OF LAWS CITED. 



PAGE 

WISCONSIN 
Statutes of 1898. 
Chap. 87 - - - 5, 7, 474, 556 

Sec. 1265 420 

Sec. 1276 427 

Sec. 1831a 197 

Statutes. 

Sec. 1778h 198 

Sec. 1797-llm - - 503, 558 

Sec. 1797-12n - - - - 558 

Sec. 1797-37m .... 668 

Sec. 1797m-l, subd. 5 - - 118 

Sec. 1797m-l to 1779m-109 99 

Sec. 1797m-46 - - - - 324 

Sec. 1797m^0 .... 99 



Statutes. pagk 

Sec. 1797m-83 - - - - 123 

Sec. i797m-90 - - - 58, 203 

Sec. 1797m-105 - - 44, 718 

Laws, 1905. 
Chap. 362 - - - 5, 401, 474 

Laws, 1907. 
Chap. 262 197 

Chap. 499-44,98,324,506,616,718 

Laws, 1909. 

Ch. 213 92 

Ch. 481 503, 564 

Ch. 540 682, 683 

Laws, 1911. 
Ch. 191 684 



Digitized by VjOOQIC 



LOCALITIES INDEX. 



PAGE 

Abbotsford. Village of. Wis., 
train and station facilities - 019 

Almena from Superior, Wis., 
refund on shipment of salt - 499 

Amery from Superior, Wis., re- 
fund on shipment of salt - 499 

Antigo (Heinemann's Mill) to 
Port Washington, W^is., re- 
fund on shipments of slabs 
and slabwood . - . - 222 

Antigo (Heinemann's Mill) to 
South Milwaukee, Wis., re- 
fund on shipments of slabs 
and slabwood - - - - 222 

Apollonia, Rusk county, V/is., 
station facilities - - - - 526 

Apple ton. Wis , municipal ac- 
quisition of waterworks, com- 
pensation for property - - 97 

Appleton from Arbor Vitae, 
Wis., refund on shipments of 
lumber 209 

Appleton from Green Bay, Wis., 
rates, group rates on coal - 436 

Appleton from Hazelhurst, 
Wis., refund on shipments of 
lumber - 209 

Appleton from Lake Michigan 
ports in Wis., rates, group 
rates on coal 436 

Appleton from Manitowoc, Wis., 
rates, group rates on coal - 436 

Appleton from Milwaukee, Wis., 
rates, group rates on coal - 436 

Appleton from Sheboygan, Wis., 
rates, group raies on coal - 436 

Appleton, Wis., from Wiscon- 
sin points (Northern Wis.,) 
refund on shipments of pulp 
wood- - - - - - - 175 

Arbor Vitae to Appleton. Wis., 
refund on shipment of lum- 
ber 209 

Arbor Vitae to Blue Mounds. 
Wis., refund on shipment of 

lumber - 21 

Arbor Vitae to Vesper, Wis., 
refund on shipment of lum- 
ber -----'-- 21 
Argyle, Wis., telephone rates - 616 
Arkansas, Wis., electric rates - 334 



PAGB 

Ashland from Birnamwood, 
Wis., refund on shipment of 
potatoes - - - - - ■ ^67 

A.shland from Clintonville, 
Wis., refund on shipment of 
potatoes - 667 

Ashland from Marion. Wis., 

- refund on shipment of pota- 
toes 667 

Babcock, Wis., train service - 534 

Beaver to Racine, Wis., re- 
fund on shipment of wood, 
slabs 199 

Berlin, Wis., demurrage 
charges and terminal facili- 
ities 14 

Birnamwood to Ashland, Wis., 
refund on shipment of pota- 
toes 667 

Black River Falls from Vaud- 
reuil, Wis., switch connec- 
tions 661 

Bloomer, Wis., electric rates 
and service 506 

Blue Mounds - from Arbor 
Vitae, Wis., refund on ship- 
ment on lumber - - - - 21 

Blue River to Richland Cen- 
ter, Wis., refund on ship- 
ment of rye 178 

Brooklyn, Wis., telephone 
rates, increased rates for 
increased service - - - 573 

Buswell to Wausau, Wis., re- 
fund on shipment of logs - 217 

Cameron, Wis., electric rates - 717 

Catawba to Oshkosh. Wis., re- 
fund on shipment of wood - 669 

Cazenovia from Wisconsin 
points, railway joint rates - 693 

Cazenovia to Wisconsin points, 
railway joint rates - - - 69S 

Clintonville to Ashland, Wis., 
refund on shipment of pota- 
toes 667 

Columbia or Wedges Creek 
Jet., Wis., to *'end of track" 
at Wedges. Creek gravel pit, 
refund on shipment of con- 
struction material - - - 173 



Digitized by VjOOQIC 



XXll 



LOCALITIES INDEX. 



Curtiss, Village of. Wis., train 
service and station facili- 
ties 



PAQE 



655 



Dallas from Superior, Wis., 
refund on shipment of salt 499 

Darlington, Wis., water rates 
and installation of meters 20,408 

Deansville, Wis., train service 
and station facilities - - 504 

Delavan, Wis., station facili- 
ties 565 

Dunham from Neillsville, Wis. 
refund on shipment of po- 
tatoes 667 

Duplainville, Wis., station fa- 
cilities ------ 23 

Durand, Wis., electric rates - 334 

Dwight, Polk Co., Wis., 
switch connections, spur 
track construction ordered 501 

Eagle River, Wis., electric 
rates 521 

Eau Gallo, Wis., electric 
rates 334 

Eleva, Wis., telephone rates 211 

Ellis Jet. to Ladysmith, Wis., 
refund on shipment of wood 
pulp ... - - 586 

Evansville, Wis., telephone 
rates 639 

Evansville, Wis., telephone 
rates and regulations - - 606 

Fond du Lac and Ushkosh. 
Wis., interurban railway 
rates and fare zones - - 473 

Fond du Lac to Milwaukee, 
Wis., refund on shipment of 
cheese 579 

Fox Uiver Valley points. Wis., 
from Lake Michigan ports 
in Wis., rates, group rates 
on coal 436 

Galesville from La Crosse, 
Wis., refund on shipment of 
flour 207 

Qrand Rapids from Lake 
Michigan ports in Wis., 

. rates, group rates on coal - 436 

Gravel Pit to Horicon, Wis., 
refund on shipment of fuel 
wood 199 

Green Bay from Lake Michi- 
gan ports in Wis., rates, 
group rates on coal - - - 436 

Green Bay to Appleton, Wis., 
rates, group rates on coal - 436 



PAGB 

Green Bay to Fox River Valley 
points. Wis., rates, group 
rates on coal 436 

Green Bay to Wausau, Wis., 
rates, group rates on coal - 436 

Green Bay to Wisconsin River 
Valley points, Wis., rates 
group rates on coal - - - 436 

Greenwood, Wis., electric rates, 
minimum cliarges - - - 60 

Hatley to South Milwaukee, 
Wis., refund on shipment of 
cordwood 222 

Hazelhurst to Appleton, Wis., 
refund on shipments of lum- 
ber 209 

Hazelhurst to Kaukauna, Wis., 
refund on shipments of lum- 
ber 209 

Horicon from Gravel Pit, Wis., 
refund on shipment of fuel 
wood 199 

Horicon from Wausau, Wis., 
refund on shipment of lum- 
ber 434 

Iron Ridge (Dodge Co.), Wis., 
railway grade crossing, sepa- 
ration of grade - -' - 128,672 

Ironton from Wisconsin points, 
railway joint rates - - - 693 

Ironton to Wisconsin points, 
railway joint rates - - - 693 

Itasca Station, Superior, from 
Superior East End yard, Wis., 
refund on shipment of 
crushed stone - - - - 219 

Janes ville (South Janesville), 
Wis., interurban railway rates 695 

Eaukauna from Hazelhurst, 
Wis., refund on shipments 
of lumber 209 

Kaukauna from Lake Michi- 
gan ports in Wis., rates, 
group rates on coal - - 486 

Kenosha from Milwaukee, Wis., 
refund on shipment of struct- 
ural iron ----- 540 

Kimberly, Wis., from Wiscon- 
sin points (Northern Wis.) re- 
fund on shipments of pulp- 
wood 175 

La Crosse, Wis., telephone and 
electric Roles, removal - 195 

La Crosse to Galesville, Wis., 
refund on shipment of flour, 207 



Digitized by VjOOQIC 



LOCALITIES INDEX. 



XXlll 



PAOB 

La Crosse to Rice Lake, Wis., 
refund on shipment of beer, 18 

La Crosse to Wisconsin points, 
less than carload rates on 
petroleum products - - 32C 

Ladysfnilh from Willis Jet., 
Wis., refund on shipment of 
wood pulp - . - - 586 

Ladysmith from Stiles, Wis., 
refund on shipment of wood 
pulp 586 

La Farire to Mt. Horeb, Wis., 
refund on shipment of lum- 
ber 528 

Lake Geneva, Wis., municipal 
acquisition of water works, 
compensation .... 403 

Lake Geneva, Wis., and im- 
mediate vicinity, electric 
rates, meter rental - - 203 

Lake Michigan ports in Wis., 
to Wisconsin points in the 
Pox River Valley and the 
Wisconsin River Valley dis- 
tricts, rates, group rates on 
coal 436 

Lake Mills, Wis., telephone 
rates 187 

Lancaster, Wis., electric rates, 
minimum charges - .- - 53 

La Valle from Wisconsin i>oints, 
railway joint rates - - 693 

La Valle to Wisconsin points, 
railway joint rates - - 603 

Lebanon. Town of, Dodge Co., 
Wis., railroad crossing - - 424 

Madison, Wis., East Johnson 
St., street railway service - 162 

Manitowoc and Two Rivers, 
ipterurban railway rates - 395 

Manitowoc to Applelon, Wis., 
rates, group rates on coal - 436 

Manitowoc to Fox River Valley 
points. Wis., rates, group 
rates on coal .... 436 

Manitowoc to Wausau, Wis., 
rates, group rates on coal • 436 

Manitowoc to Wisconsin River 
Valley points. Wis., rates, 
group rates on coal - - 436 

Marion to Ashland, Wis., re- 
fund on shipment of pota- 
toes 667 

Marshfield, Wis., telephone 
rates, extra charge for long 
distance connections - - 589 

Marshfield from Wisconsin 
points, refund on shipment 
of logs #71 



PAGE 

Mayville from Milwaukee, Wis., 
refund on shipment of scrap 
iron 205, 548 

Merrill from Lake Michigan 
ports in Wis., rates, group 
rates on coal .... 430 

Milton, Wis., telephone rates 542 

Milton Junction, Wis., tele- 
phone rates 542 

Milwaukee, Wis., electric 
power rates for charging au- 
tomobiles 64 

Milwaukee, Wis., telephone 
rates from hotel rooms - - 432 

Milwaukee from Fond du Lac, 
Wis., refund on shipment of 
cheese 579 

Milwaukee from Waukesha, 
Wis., refund on shipment of 
beer 518 

Milwaukee to Appleton, Wis., 
rates, group rates on coal - 436 

Milwaukee to Fox River Val- 
ley points, Wis., rates, group 
rates on coal 436 

Milwaukee to Kenosha, Wis., 
refund on shipment of struc- 
tural iron - - - - - 540 

Milwaukee to Mayville, Wis., 
refund on shipment of scrap 
iron 205, 548 

Milwaukee to. Wausau, Wis., 
rates, group rates on coal - 436 

Milwaukee to Wauwatosa, 
Wis., refund on shipment of 
coal 531 

Milwaukee to Wisconsin points, 
' less than carload rates on pe- 
troleum products ... 326 

Milwaukee to Wisconsin River 
Valley points. Wis., rates, 
group rates on coal - - - 436 

Minnesota Jet., Wis., train 
service 581 

Mt. Iloreb, Wis., electric rates 44 

Mt. Horeb from La Farge, Wis., 
refund on shipment of lum- 
ber 528 



Neenah, Wis., rates, joint 
street railway rates between 
the Wis. Tr. Lt. H. & Pr. 
Co. and the Wis. El. Ry. 
Co. 398, 690 

Neenah from Lake Michigan 
ports in Wis., rates, group 
rates on coal - - - - 436 



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XXIV 



LOCALITIES INDEX. 



PAGE 

Neillsville to Dunham, Wis., 
refund on shipment of pota- 
toes ... - - - - 667 

^ekoosa from Lake Michigan 
ports in Wis., rates, group 
rates on coal . - - - 436 

K^ew Holstein, Wis., train 
service ~ - 5 

New Lisbon, Wis., train serv- 
ice 534 

Newry, Wis., station facilities 1 

Onalaska, Wis., street rail- 
way service and station fac- 
ilities 124 

Oshkosh and Fond du Lac, 
Wis., interurban railway 
rates and fare zones - - 473 

Oshkosh from Catawba, Wis., 
refund on shipment of wood - 669 

Plain, Wis., telephone rates - 549 

Port Washington from Antigo 
(Heinemann's Mill), Wis., re- 
fund on shipments of slabs 
and slabwood - - - .- 222 

Portage, Columbia and Wyo- 
cena. Wis. (sand and gravel 
b'^d between), spur track - 556 

Prarie du Sac, Wis., telephone 
rates 549 

Prairie du Sac from Richland 
Center Wis., refund on ship- 
ment of lumber and reduc- 
tion of rates 184 

Progress, Wis., train service - 534 

Racine, Wis., gas rates - - 228 

Racine from Beaver, Wis., re- 
fund on shipment of wood 
slabs ---..-- 199 
. Rhinelander to Stevens Point, 
Wis., refund on shipment of 
print paper - - - - 182 

Rice Lake, Wis., electric rates - 717 

Rice Lake from La Crosse. 
Wis., refund on shipment of 
beer - - - - ; - - 18 

Richland Center from Blue 
River. Wis., refund on ship- 
ment of rye 178 

Richland Center to Prairie du 
Sac, Wis., refund on ship- 
ment of lumber and reduction 
of rates 134 

Romadka, Wis., train service - 534 



Sauk City, 
rates - " - 



Wis., telephone 



PAGB 

Schleisingerville, Wis., statioa 
facilities 663 

Shawano to Western Siding, 
Wis., refund on shipment of 
salt 497 

Sheboygan, Wis., electric rates 
and service, street lighting - 353 

Sheboygan to Appleton, Wis., 
rates, group rates on coal - 436 

Sheboygan to Fox River Valley 
points. Wis., rates, group 
rates on coal - - - - 436 

Sheboygan to Wausau, Wis., 
rates, group rates on coal - 436 

Sheboygan to Wisconsin River 
Valley points. Wis., rates, 
group rates on coal - - - 436 

South .lanesville, Wis., inter- 
urban railway rates - - 695 

South Milwaukee from Antigo. 
(Heinemann's Mill), Wis., 
refund on shipment of slabs 
and slabwood - - - - 222 

South Milwaukee from Hatley, 
Wis., refund on shipments of 
cord wood 222 

Spring Green, Wis., telephone 
rates 549 

Stevens Point, Wis., water rates 
and service ----- 458 

Stevens Point from Rhineland- 
er, Wis., refund on shipment 
of print paper - - - - 182 

Stiles to Lady smith, refund on 
shipment of wood pulp - - 586 

Sun Prairie, Wis., telephone 
rates 187 

Sun Prairie, Wis., telephone 
rates and service - - - 647 

Superior, Wis., railroad cross- 
ing, viaduct 674 

Superior, Wis., switching ser- 
vice, whether interstate or 
intrastate 70 

Superior to Almena, Amery, 
and Dallas, Wis., refund on 
shiprnenl of salt - - - - 499 

Superior, East End Yard, to 
Itasca Station, Superior, 
Wis., refund on shipment of 
crushed stone - - - - 219 

Two Rivers and Manitowoc. 
Wis., interurban railway 
rates 395 



Vaudreuil to Black River Falls, 
549. Wis., switch connections 



661 



Digitized by VjOOQIC 



LOCALITU:S INDEX. 



XXV 



Vesper from Arbor Vitae, Wis., 1 

refund on shipment of lum- i 

bor 21 1 



Washburn, Wis., water rates 
installaiion of meters 74 

Waterloo, Wis., telephone rates 187 

Waukesha to Milwaukee, Wis., 
refund on shipment of beer - 518 

Wausau from Buswell, Wis., 
refund on shipment of logs - 217 

Wausau, from Green Bay, W^is., 
rates, group rates on coal - 436 

Wausau from Manitowoc, Wis., 
rates, ^oup rates on coal 436 

Wausau from Milwaukee, Wis., 
rales, group rates on coal 436 

Wau!»au from Sheboygan, Wis., 
rates, group rates on coal - 436 

Wausau to Horicon, Wis., re- 
fund on shipment of lumber • 434 

Wautoma, Wis., telephone rates 419 

Wauwatosa from Milwaukee, 
Wis., refund on shipment of 
coal 531 

Wedges Creek Jet., or Colum- 
bia! Wis., to '*end of track" 
at Wedges Creek gravel pit, 
refund on shipment of con- 
struction material - - 173 

Western Siding from Shaw^ano. 
Wis., refund on shipment of 
salt 497 

Whitewater, Wis., electric serv- 
ice, municipal lighting - - 132 

Wisconsin points from La 



Crosse. Wis., less than car- 
load rates on petroleum prod- 
ucts 32() 

Wisconsin points from La Valle. 
Wis., railway joint rates - (593 

Wisconsin points from Milwau- 
kee, Wis., less than carload 
rates on petroleum products 320 

Wisconsin points on the C. St. 
P. M, «fe O. R.. concentration 
rates e^ablished - - . 625 

Wisconsin points (northern 
Wis.), to Appleton, Wis., re- 
fund on shipments of pulp 
wood 175 

Wisconsin points to Cazen- 
ovia. Wis., railway joint 
rates 093 

Wisconsin points to Ironton, 
Wis., railway joint rales - 693 

Wisconsin points (northern 
Wis.) to Kimberly, Wis.,, re- 
fund on shipments of pulp 
wood 1 75 

Wisconsin points to La Valle, 
Wis., railway joint rates - 693 

Wisconsin points to Marshtield; 
Wis., refund on shipment of 
logs 571 

Wisconsin River Valley points. 
Wis., from Lake Michigan 
ports in Wis., rates, group 
rates on coal 436 

Wyocena and Portage, Colum- 
bia County. Wis. (sand and 
gravel bed between), spur 
track 55 



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OPINIONS AND DECISIONS 



Railroad Commission of Wisconsin 



WILLIAM A. HOMSTAD, bt al. 

vs. 
CHICAGO, MILWAUKEE AND ST. PAUL RY. CO. 



Submitted Oct, 11, 1910, Decided Nov. 11, 1910, 



Petition alleging inadequate station facilities at Newry and praying 
that a suitable station building be constructed and a com- 
.petent agent appointed. 

Held: That mere inconvenience does not establish inadequacy of serv- 
ice; that the amount of business transacted at a station does 
not furnish the decisive factor, but that the Commission must 
judge each particular case on the basis of all the elements 
that enter into the situation; that the station facilities at 
Newry are not inadequate!, except with reference to the ship- 
ment of live stock. The construction of suitable and ade- 
quate stock yards is ordered. 

Petitioners allege that the present station facilities at Newry 
are inadequate with respect to both the passenger and freight 
business. It is alleged that perishable freight, such as butter, is 
exposed to the elements in all kinds of weather, and that patrons 
of the railway suffer many inconveniences and losses on ac- 
count of the existing inadequacy in the facilities. 

Petitioners pray for an order requiring the respondent rail- 
way company to construct a suitable station building, and to 
appoint and maintain therein a competent agent with whom pa- 
trons may transact business relating to all branches of railway 
service. 

The answer of the respondent railway company asserts that 
the company now maintains a sidetrack at Newry and that it 



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2 RAII^ROAD COMMISSION OF WISCONSIN. 

has made arrangements for the handling of carload and less than 
carload freight ; that it maintains a regular prepaid station ; that 
additional station facilities and the appointment of an agent for 
the handling of business at this point can not be reasonably re- 
quired; and that the appointment and maintenance of an agent 
would force the respondent to maintain station facilities at 
Newry at a direct loss. 

Hearings were held at the office of the Commission on Sep. 

14 and Oct. 11, 1910, W, A, Homstad and Andreiv Urness ap- 
pearing for the petitioners, and William B, Hinrichs for the 
respondent. 

All of the material facts bearing upon this case were stated in 
the previous decision of this Commission, 2 W. R. C. R. 66 to 70, 
decided Oct. 28, 1907. Petitioners testified that no material 
changes had taken place with reference to the surrounding coun- 
try, except that there had been a general growth along all lines. 
It will be recalled that Newry is situated somewhat less than 
three miles from Cashton and about fiwe miles from Westby. 
The railroad facilities at present provided at Newry by virtue 
of the order of Oct. 28, 1907, are a sidetrack capable of hold- 
ing three cars, a small structure for the accommodation of pas- 
sengers, about 9 by 10, with facilities for heating and lighting, a 
structure of similar size which serves as a freight station, with 
a custodian in charge of these. Correspondence relating to this 
case shows that a high platform with a sheltering roof has been 
recommended by the train master of the division on which 
Newry is located. We assume that a suitable platform will be 
erected without unreasonable delay. 

Outgoing freight is billed from Cashton, and incoming freight 

15 recorded at Westby. The inability of shippers at Newry to 
bill freight from that point and to receive freight which has not 
been prepaid is doubtless a disadvantage, and in some cases an 
inconvenience. Petitioners desire to have this inconvenience 
remedied through the appointment of an agent. 

The testimony shows that sometimes freight is carried past 
Newry and returned by the next train, resulting in what peti- 
tioners regard as unnecessary delay and loss. It was explained 
that when freight destined to Newry was, as a matter of fact, 
carried past Newry, it was the result of the crowded condition 
of the car necessitating other freight being piled on the Newry 



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HOMSTAD ET AL. V. C. M. A ST. P. R. CO. 3 

freight, which made it practically impossible to release the Newry 
freight by the time the train arrives at Newry. This condition 
can doubtless be remedied, and the railway company should rem- 
edy it promptly, even though some extra labor must be performed 
and the train must at times be held at Newry until the freight 
destined to that point can be released from the car. 

With respect to the allegation that perishable freight is exposed 
to the elements, sometimes causing unnecessary loss to the ship- 
pers, we do not think the evidence is conclusive. It is the duty 
of the railway company to properly care for all classes of 
freight, and if shipments of butter, for instance, have been im- 
properly handled at Newry station, peremptory orders should be 
given which will insure their being properly handled in the fu- 
ture. We fail to see why the railway company should not be 
able to furnish satisfactory service in this respect with the facili- 
ties which exist there now. 

The inconvenience of purchasing tickets on the train, or, in 
case passengers desire to go to more remote points, of purchas- 
ing them at junction points, like Sparta, may be annoying occa- 
sionally to individual passengers, but it can hardly be regarded 
as conclusive evidence of inadequate service at Newry. To be 
sure, it would be more convenient to be able to purchase all 
lickets.at Newry station from a regularly constituted agent, but 
as long as passengers may board trains or alight from them at 
Newry, going to any point and coming from any point, and as 
long as they can purchase tickets to all such points without loss 
of time in* transit, we do not believe that this inconvenience is of 
sufficient importance to have any substantial eflFect in arriving at 
a conclusion with reference to the instant case. 

What is apparently a carefuMy prepared exhibit' was intro- 
duced by petitioners, showing that during the year 1909 and the 
first nine months of 1910 sixry-seven farmers residing in the 
vicinity of Newry shipped from Westby, Cashton, and Newry 
the following quantities of freight: Cattle, 600 head; calves, 
336; hogs, 553; sheep and lambs, 341; wheat, 360 bushels; bar- 
ley, 8,875 bushels; oats, 14,700 bushels; sugar beets, 208 tons; 
tobacco, 198,700 lbs. These sixty-seven farmers resided at 
an average distance of 1.8 miles from Newry, 4.72 miles from 
Cashton, and 5.93 miles from Westby. Petitioners suggest the 
conclusion that a regularly established station at Newry would 
result in all this freight being shipped from that point. 



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4 RAII30AD COMMISSION OF WISCONSIN. 

A regularly equipped station would unquestionably add to the 
convenience of persons residing in the vicinity of Newry. It 
would also tend to build up the business at Newry much more 
rapidly than is possible with the present facilities. But consid- 
erations like these can not be regarded as final in arriving at a 
decision. If existing facilities are reasonably adequate, the 
Commission is without authority to order additional facilities. 
Mere inconvenience does not establish tmreasonable inadequacy 
of service, nor does the amount of business transacted at a sta- 
tion furnish the decisive factor. 'Statistics were introd'uced in 
evidence showing the amount of business at present transacted 
at Newry. It is conceivable that with many times this amount 
of business transaotted at such a station the Commission would 
be compelled to decide that it could not justly order additional 
facilities, and, on the other hand, it is conceivable that with only 
a fractional part of this business the Commission might decide 
that additional facilities should be ordered. The Commission 
must judge each particular case on the basis of all the elements 
that enter into the situation. As we view the situation at Newry, 
we do not believe that the testimony shows that the existing 
facilities at Newry are inadequate, except with reference to the 
shipment of live stock. We think the facts warrant the con- 
struction of a cattle yard suitable and adequate for a point of 
this character. If at some time in the future conditions should 
change to such an extent that still further facilities may justly 
be ordered, the Commission will consider a petition with this 
end in view, and if all the facts in the case justify it, will order 
still more facilities. This can be taken care of when the time 
comes. 

It is Thbbepore Obdebed, That the respondent railway com- 
pany construct stock yards suitable and adequate for a point like 
Newry and similar to stock yards generally constructed at sta- 
tions of this class. 

Thirty days is deemed a sufficient time within which to comply 
with the provisions of this order. 



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LAUN V. C. M. ^ ST. P. R. CO. 



A. A. LAUN 

vs. 
CHICAGO. MILWAUKEE AND ST. PAUL RAILWAY COMPANY. 



Buhmitted Oct. 11, 1910. Decided Nov. 12, 1910, 



Petition alleging inadequate passenger train service at New Holstein 
and praying that interstate mail trains No. 2 and No. 3, run- 
ning south and north, respectively, be ordered stopped at said 
station. It appears to have been the practice ot the respond- 
ent to stop such trains for passengers from Chicago or points 
north of Green Bay, and at other times in the discretion of 
the respondent's agents. Petitioner contends that mail would 
he received on and delivered from said trains if they were or- 
dered stopped. 

Held: That the practice of permitting an agent of the company to de- 
termine whether or not stops should be made at any station, 
is indefensible, such matter should be governed by a, regula- 
tion of general application; that the Commission is not justi- 
fied in requiring an interstate train to stop at any point 
merely on the expectation that the delivery and reception of 
mail matter might be ordered by the post office department, 
any complaint relating to the delivery of mail should be ad- 
dressed to such department; that the Commission probably 
has no power to act in the instant case, because of the inter- 
state character of the trains in question and the service now 
furnished at New Holstein, except insofar as the voluntary 
regulation of respondent as to the stoppage of trains at said 
point affects the intra-state traffic. Respondent is ordered to 
sell tickets at Milwaukee for passage on train No. 3 to New 
Holstein, and that said train stop at New Holstein for the 
purpose of discharging such passengers; that train No. 2 stop 
at New Holstein, on signal, to take on passengers for Mil- 
waukee or Chicago. 

The petitioner alleges that the respondent is a common carrier 
engaged in the transportation of persons and property by rail- 
road between points in the state of Wisconsin, and that as such 
common carrier respondent is subject to the provisions of ch. 87 
of the Wisconsin Statutes of 1898 and the several acts amenda- 
tory thereof and supplementary thereto, and is likewise subject 
to the provisions of ch. 362 of the Laws of 1905 and the several 
acts amendatory thereof and supplementary thereto; that re- 
spondent operates a line of railway between the city of Chicago, 
111., and the city of Republic, Mich.', which line is known as the 
Superior division of respondent's railway; that the village of 



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6 tlAlLbOAD COMMISSION OF WtSOONSlK. 

New Holstein, Calumet county, Wis., is a municipal corporation 
having a population of upwards of one thousand, and is a thriv- 
iiigj growing, prosperous Village; that there are located in said 
village of New Holstein several large manufacturing establish- 
ments, grain elevators, and other business enterprises, and that 
said village is the center of a large and prosperous farming com- 
munity and is the market place for large quantities of farm and 
dairy prodilcts ; that many persons residing at New Holstein and 
in its vicinity use and are obliged to use said railway for business 
and pleasure, and many persons residing outside of said village 
are obliged! to use said railway for the same purpose; that the 
village of New Holstein is located in Calumet county. Wis., upon 
said Superior division, about seventy miles north of the city of 
Milwaukee; that respondent operates three passenger trains upon 
said division each way, those going north on said division being 
numbered, respectively, No. 3, No, 23, and No. 31, and those 
going south upon said division being numbered, respectively. 
No. 2, No. 6, and No. 22 ; that trains No. 2 and No. 3' are oper- 
ated daily, including Sunday, and trains Nos. 6, 22, 23, and 31 
are operated daily except Sunday ; that train No. 31, going north, 
leaves the city of Milwaukee at 7 :20 a. m. and arrives at New 
Holstein at 9:40 a. m. ; that train No. 23 leaves Milwaukee at 
5 :10 p. m. and arrives at New Holstein at 7 :35 p. m. ; that train 
No. 6, going south on said division, leaves New Holstein at 4 :12 
p. m. and arrives at Milwaukee at 6:45 p. m.; and that train 
No. 22 leaves New Holstein at 8 :17 a. m., arriving at Milwaukee 
at 10 :35 a. m. ; that neither train No. 2 nor train No. 3 stops at 
said village; that train No. 3 leaves Milwaukee at 12:15 a. m. 
and goes through the village of New Holstein about 2:25 a. m,, 
and that train No. 2, going south on said division, goes through 
the village of New Holstein at about 2 :00 a. m., and arrives at 
Milwaukee at 4 :30 a. m. ; that the United States mail is carried 
upon said trains Nos. 2 and 3, besides many passengers, and said 
train stops at many stations on said division for the purpose of 
taking on and discharging passengers and taking on and dis- 
charging mail; that between the cities of Green Bay, Wis., and 
Milwaukee, Wis., said railway company makes the following con- 
nections at the following named places upon said Superior divi- 
sion: at De Pere, Wis., with the Chicago & North Western Rail- 
way Company; at Forest Jet. with the Chicago & North West- 
ern Railway Company; at Tlilbert Jet. with a branch line of the 



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LAtTN v. C. M. & ST. P. R. 00. ? 

Chicago, Milwaukee & St. Paul Railway Company running to 
Neenah, Menasha, and Appleton; at Plymouth, Wis., with the 
Chicago & North Western Railway Company, and also an in- 
terurban railway line connecting the cities of Plymouth aforesaid 
and Sheboygan, Wis.; at Cedarburg, Wis., with an interurban 
line running from the city of Sheboygan through the city of Port 
Washington to the city of Milwaukee aforesaid ; that by reason 
of the steam and interurban railway connection, and by reason 
of the numerous places on said division at which trains No. 2 
and No. 3 stop, the public, and particularly the residents of New 
Holstein, are put to great inconvenience and loss because said 
trains do not stop at said village, and if said trains were required 
to stc^ at said village petitioner verily believes that mail matter 
would be received on and delivered from said trains for New 
Holstein by rural route, and that the delivery of such mail would 
be of great benefit to the said village and the inhabitants thereof, 
and their failure to have said mail so delivered is a great and 
serious loss to them. That the business interests of the inhabi- 
tants of said village require and demand that said trains No. 2 
and No. 3 stop at said vilUge; thait your i>etitioner brings this 
proceeding in his own behalf and in behalf of all persons resid- 
ing at New Hohtein, aforesaid, similarly situated and similarly 
interested. Wherefore, petitioner prays that the aforesaid rail- 
way company be required to answer the complaint herein and, 
after due hearing and investigation, such order be made by said 
Railroad Commission of Wisconsin as may seem necessary and 
just in the premises, and that it grant such other and further 
order or relief as may be just and proper. 

The respondent, answering the petition, admits that it is a 
common carrier engaged in the transportation of persons and 
property by railroad between points in the state of Wisconsin, 
and that as such common carrier said railway company is subject 
to the provisions of ch. 87 of the Wisconsin Statutes of 1898 and 
the several acts amendatory thereof and supplementary thereto; 
that it operates a line of railway between the city of Chicago, 
III., and the city of Republic, Mich», which line is known as the 
Superior division; that the allegation of the petitioner relative 
to the schedule of its trains running through the village of New 
Holstein are practically true, except as to the time of train No. 
6, wiiich is due at New Holstein at 4:12 p. m. instead of 4:27 
p. m. : that trains Nos. 2 and 3 are heavy interstate mail trains. 



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8 RAILROAD COMMISSION OF WISCONSIN. 

running from the northern peninsula of Michigan to the city of 
Chicago, 111., where important mail connections are made, and 
that trains Nos. 2 and 3 stop only at the larger stations and junc- 
tion points upon the Superior division; that various connections 
are made between trains of this company and those of other 
lines which cross or are located adjacent to the lines of this com- 
pany. The respondent further admits that it has neither knowl- 
edge nor information sufficient to form a belief as to the all^a- 
tions set forth in the petition relative to the importance of the 
village of New Holstein as a center of large manufacturing es- 
tablishments, grain elevators and other business enterprises, and 
a large and prosperous farming community and market place for 
large quantities of farm and dairy products, or the need of the 
use of the line by the people residing at New Holstein and its 
vicinity for business purposes or pleasure, and while it neither 
admits nor denies the statements made by the petitioner, it de- 
mands that petitioner be held to .strict proof thereof. 

Respondent, however, denies that by reason of the fact that 
trains Nos. 2 and 3 do not stop at New Holstein that the resi- 
dents of that village and vicinity are put to any great inconven- 
ience or loss. Respondent avers that morning mail for New 
Holstein is carried on No, 3 to Green Bay and returned' on train 
No. 22, which arrives at New Holstein at 8 :17 in the morning, 
or before the usual business hours, and respondent denies that 
there is any reasonable necessity or advantage to be gained by 
the arrival of mail at that point at any earlier time than that of 
the present schedule, and denies that there is any reasonable 
necessity for the stopping of said trains Nos. 2 and 3 for the re- 
ceiving and discharging of passengers. Respondent further avers 
that said train, being an interstate mail train, is not subject to 
the jurisdiction of the Railroad Commission of Wisconsin, unless 
it can be positively shown that adequate service is not otherwise 
furnished ; and that running four trains other than trains Nos. 2 
and 3^ which do stop at said station, constitutes reasonable and 
adequate service. 

Respondent, further answering petition, denies each and every 
allegation in said petition not hereinbefore admitted, denied, or 
otherwise answered unto, and prays that the petition be dis- 
missed. 

The hearing was held Oct. 11, 1910, in the office of the Rail- 
road Commission in the capitol, Madison, Wis., Nash & Nash, 



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LAUN V. 0. M. A ST. P. R. 00. 9 

attorneys at law, appearing for the petitioner, and £. V. Hast- 
ings and /. Af . Davis for the respondent. 

The testimony shows that the respondent operates five pas- 
senger trains which pass through New Holstein, three going 
north and two going south. One of these trains, of great im- 
portance, called the Limited, carries mail, express, passengers 
and sleeping cars. It leaves Milwaukee at 12:15 a. m. and is 
due at New Holstein at 2:20 a. m., and goes through to Calu- 
met, Michigan. The same train, returning, leaves Calumet at 
4 p. m., passes through New Holstein at 2 :02 a. m., and is d»ue 
at Milwaukee at 4:30 a. m. This train is not scheduled to stop 
at New Holstein, but stops at times on request of passengers. 
Requests to stop are not always granted. The character of the 
business, whk:h the party asking for the stop proposes to trans- 
act, determines whether the stop shall be made. Refusal to 
stop is usually made to short ride passengers. 

Train No. 3 starts at Chicago, but is divided at Milwaukee. 
One part, with cars added, forming a train at Milwaukee, runs 
to St. Paul, and the other part, forming a train, goes to Calumet. 
These trains are heavy, consisting of from eight to twelve cars 
each, and make mail connections at Chicago. As their time is 
fast and diiiicult to make, as few stops as possible are made. 
Conductors have instructions to stop them when there are pas- 
sengers aboard having tickets reading "Chicago to New Hbl- 
stein." Stops are frequently made for the accommodation of 
large parties, regardless of the distance they desire to travel. 
Stops are also made to acccMnmodate physicians on professional 
business. Trains Nos. 2 and 3 stop at Kiel to pass each other. 
During the summer months, when passenger business is very 
heavy, they also stop at Elkhart Lake. These trains also stop at 
Chilton. 

New Hblstein is a village of about nine hundred, with a large 
adjacent farming territory. The total population depending on 
and using the railroad facilities at New Holstein is about 2,500 
or 3,000. The income from the passenger traffic from the New 
Holstein station is between $30,000 and $40,000 per year. The 
village is prosperous and thriving, and is located in the center 
of a large and prosperous farming community. It has a large 
number of manufacturing plants which ship their products to 
all parts of the United States, Australia, South America, and 
the countries of gu^-opc. The business of the town for the past 



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10 RAOiBOAD COMMISSION OF WISCONSIN. 

five or six years has steadily increased. Business men, through 
inadequate passenger service, find it difficult to make short busi- 
ness trips. If they desire to go to Chicago, they cannot return 
hcHne the same day, and if they go to Milwaukee and' arc de- 
tained after 5:10 p. m., they are obliged to remain there over 
night. 

Conductors on trains not scheduled to stop at New Holstcin 
have instructions to stop, however, when there is a passenger 
aboard with a ticket reading "Chicago to New Holstein." Should 
a passenger on No. 3 holding such a ticket get off the train 
Bit Milwaukee for any reaison and ^o into the depot, lie would 
be refused entrance to the train shed on returning to his train. 
He would be regarded as any passenger desiring to travel on 
that train from Milwaukee to New Holstein. Frequently peo- 
ple are also refused tickets for this point when about to purchase 
them at the Milwaukee station. 

Through refusal to stop trains at New Holstein, people fre- 
quently are obliged to walk from Kiel, where the trains stop 
regularly, to New Holstein. Others have been obliged to pass 
through New Holstein and stop one night in Chilton. There was 
an instance given where a party numbering over twenty people, 
©11 residents of New Holstein, were detained at Plymouth be- 
cause of inability to secure permission to have the train stopped 
at New Holstein. Some of this party remained over night at 
Plymouth, some took the intenirban to Elkhart Lake, while 
others took the train down to Kiel and walked over to New Hol- 
stein. An hour was spent by representatives of the party dis- 
cussing the matter with the station operator at Plymouth, but as 
the situation was not made clear to the dispatcher's office, the 
request to stop the train was refused. 

It appears that trains from the north stop at all regular sta- 
tions for passengers at points south and west of Milwaukee and 
also for trains on connecting lines. 

Conductors have instructions to stop at New Holstein to allow 
passengers from points north of Green Bay to get oflF, but in- 
stances were given wtiere this privilege had been denied. 

The respondent has no fixed rule regarding stops for parties. 
Each request is considered on its own basis. 

The passenger service provided for the inhabitants of New 
Holstein and vicinity by the respondent railway company con- 
sists of two passenger trains and one way freight train each way 



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LAUN V. C. M. A ST. P. B. CO. 11 

daily except Sundays. The passenger trains are scheduled as 
follows: No. 31 leaves Milwaukee at 7:20 a. m., passes New 
Holstein at 9 :40 a. m., arid continues to Calumet, Mich. ; No. 23 
leaves Chicago at 3:00 p. m., arrives at New Holstein at 7:35 
p. m. and continues to Green Bay, Wis. ; No. 22 departs from 
Green Bay at 7 :00 a. m., arrives at New Holstein at 8 :17 a. m., 
at Milwaukee at 10:35 a.'m., and reaches Chicago at 1:00 p. m. ; 
No. 6 departs from Marquette, Mich., at 2:40 p. m., arrives at 
New Holstein at 4:12 p. m., at Milwaukee at 6:30 p. m. and 
reaches Chicago at 9:00 p. m. Way freight train No. 91, car- 
rying passengers, is scheduled to leave Milwaukee at 5 :05 a. m., 
to arrive at New Holstein at 12 :45 p. m., and Green Bay at 3:00 
p. m. South-bound way freight No. 92, carrying passengers, is 
scheduled to depart from Green Bay at 7 :10 a. m., to arrive at 
New Holstein at 10:20 a. m., and Milwaukee at 5:30 p. m. 

The way freight train can scarcely be considered in determin- 
ing the adequacy of the present passenger service furnished the 
citizens of New Holstein and vicinity, as the times of arrival 
and departure of such trains are so uncertain that no one seems 
to travel on them. However, two passenger "trains each way 
daily would, und'er ordinary circumstances, be all that a commun- 
ity of 900 inhabitants could justly demand of a railway com- 
pany in the way of passenger service. Dyer v, C. M, & St, P. 
/?. Co. 2 W. R. C. R. 621. In the instant case, the railway com- 
pany has recognized the necessity of additional passenger service 
at New Holstein in certain instances. Thus, when a number of 
persons forming a party desire to travel on train No. 2 or train 
No. 3 to or from New Holstein, such trains are usually stopped 
to acccMnmodate such passengers. They are also stopped to dis- 
charge passengers coming from Chicago and Green Bay and 
destined to New Holstein. At the option of the agent of the 
company stops arc also made to accommodate persons wishing to 
go to Chicago, but there is no general rule in effect respecting 
such stops. To permit an agent of the company to determine, 
in his discretion, the exigency requiring a stop in any particular 
case, seems to us indefensible. The matter should not be left 
to the judgment of any one or more persons but should be gov- 
erned by a regulation of general application, otherwise unjust 
discrimination will of necessity occur. It is our best judgment 
that the trains in question should be availfible to the people of 
New Holstein and vicinity for long distance travel, regardless 



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12 RAILROAD COMMISSION OF WISCONSIN. 

of the purpose of their journey, which at present seems to be 
the criterion by which the granting or refusal of a request to 
stop a train to enable a passenger to travel to Milwaukee or Chi- 
cago is determined. 

The inability of passengers holding tickets reading "Chicago 
to New Holstein" to temporarily leave the car and enter the de- 
pot at Milwaukee for any purpose while the train is being made 
up, should be obviated. Furthermore, people desiring to go from 
Milwaukee to New Hblstein should be accorded the privilege 
of traveling on this train. There is no apparent reason that any 
distinction in the matter of service should be made between 
persons going from Chicago and those going from Milwaukee to 
New Holstein. Tickets should be sold -at Milwaukee as well as 
at Chicago for passage on this train. 

With the change in the service indicated, we believe that the 
service in the particulars complained of will be reasonably ade- 
quate. As the trains jn question are interstate trains, we could 
not, under the circumstances of this case, compel the railway 
company to stop them regularly at New Holstein. Farmer v. D. 
S. S. & A, R, to, 1 W. R. C. R. 316; Dyer v. C. M, & St. P. 
R. Co. 2 W. R. C R. 621. 

It seems that one of the principal reasons advanced by peti- 
tioner for requiring trains Nos. 2 and 3 to stop at the village of 
New Hblstein is that the United States mail could be thrown 
off at that point, thus enabling business men to receive their im- 
portant mail earlier in the day than at present, but while the 
receipt of the mail earlier in each day would be a convenience 
to certain manufacturing concerns, it does not follow that the 
mail would be delivered at this point, even if such trains were 
stopped to discharge and take on passengers. The delivery of 
mail is a matter which the post office department alone can reg- 
ulate. If it is imperative, as the testimony tends to show, that 
the mail be delivered from such trains rather than carried past 
the station and then returned on a later train, the matter should 
be taken up with the proper government authorities who have 
power to act in the premises. This Commission would not be 
justified in requiring an interstate train to stop at any point 
merely in the expectation that the post office officials might be 
persuaded to deliver and receive mail matter at such point. Un- 
less the necessity for a stop exists in respect to some matter of 
service over which the Commission has jurisdiction, it is not au- 



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LAUN V, C. M. A ST. P. B. CO. 13 

thorized to act in any way to interfere with the operation of 
the trains. Furthermore, it would probably have no power to 
act in the instant case, because of the character of the trains in 
question and the service now furnished the inhabitants of New 
Holstein and vicinity, except that the respondent has voluntarily 
put into effect a regulation by virtue of which stops of such 
trains are made in certain instances. Insofar as this regulation 
affects the adequacy oi intrastate traffic, it is subject to the con- 
trol of the Commission and may be modified by the Commission 
if thereby interstate traffic is not unreasonably delayed or bur- 
dened. 

It would seem from the facts shown, as already stated, that 
the north-bound train in question should be available to persons 
traveling from Milwaukee as well as from Chicago to New Hol- 
stein, and ithat the south-bound train should be stopped at the 
latter station to take on passengers destined to the former sta- 
tions, regardless of the character of the business they propose to 
transact at their destination. With such change in the service, 
it is probable that the principal complaint of petitioner will be 
obviated. 

It is Therefore Ordered : 

1. That the Chicago, Milwaukee & St. Paul Railway Company 
sell tickets at its station in Milwaukee, available for passage on 
train No. 3 to New Holstein, Wis., and that it stop said train 
No. 3 at New Holstein, Wis., for the purpose of discharging pas- 
sengers leaving Chicago and Milwaukee destined to New Hol- 
stein. 

2. That the respondent stop train No. 2 at New Holstein, Wis., 
on signal, for the purpose of taking on passengers destined to 
Milwaukee and Chicago. 



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14 RAILROAD C'OMM18.SlON OP W^SCONSlN. 



ALLEN LUMBER COMPANY 

V8. 

CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMJPANY. 



Submitted Oct, 11, 1910. Decided Nov. 16, 1910. 



Petition alleging that cars, after being placed on the teaming tracks of 
respondent in Berlin, Wis., for unloading, are put into switch- 
ing and other trains during petitioner's free time for unload- 
ing, thereby preventing tneir prompt unloading and causing 
loss to the petitioner. 

Held: That the law impliedly recognizes that public delivery tracks 
are, of necessity, more or less inadequate, and therefore pro- 
vides that owners of industries may construct private tracks 
within the yard limits and connect them with the main tracks 
tor the purpose of receiving and delivering freight; that to 
allow additional compensatory time for the time consignee Is 
deprived of access to the cars, would result in discrimination 
and rebates of the worst character, which would be difficult 
to detect and more difficult to prove; that the demurrage rules 
now in effect are adequate in most instances and equalize fairly 
well the loss of shippers and railroads occasioned by delays in 
unloading cars. Petition is dismissed. 

The petitioner is a corporation engaged in the lumber and fuel 
business at Berlin, Wis. It alleges that the respondent railway 
company places cars for unloading by the petitioner upon its 
teaming tracks in Berlin, and after so placing them, puts them 
into switching or other trains, and the time thus occupied in 
switching said cars is taken out of petitioner's free time for un- 
loading them; that thereby the petitioner's workmen and teams 
employed in unloading cars are delayed, causing loss to the peti- 
tioner. Wherefore, petitioner prays for relief from the condi- 
tions complained about. 

The respondent railway company, answering the petition, al* 
leges that the petitioner receives various shipments, which are 
switched by the respondent to its team tracks in the city of Ber- 
lin, but denies that petitioner is seriously injured by reason of 
the fact that it is necessary to switch cars to and from said team 
tracks, upon which petitioner's cars have been set. ^The respond- 
ent further avers that it is absolutely necessary in the discharge 
of its bushiess as a common carrier, tliat loaded cars consigned 
to people at Berlin be switched to said team tracks and empty 
cars switched therefrom. Wherefore, respondent prays that the 
petition be dismissed. 



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ALIiAN LUMBER CO. V. C M. it ST. P. A. CO. 15 

A hearing was held on Oct* 11, 1910. Cyrus W, Allen ap- 
peared for the petitioner, and /. 0. Klapp appeared for the re- 
spondent. 

The testimony shows that cars placed by the respondent oti its 
roaming tracks in the city of Berlin for the purpi>se of unlcwdtng 
are removed from time to time by switch engines and held in 
switch trains, and that the time consumed in removing and re- 
turning such cars to the point where they may be unloaded is 
taken out of the petitioner's free time for unloading. It some- 
times happens that after petitioner is notified that a car is located 
on the public delivery track for unloading, it sends its men and 
teams to the track only to discover that the cars have been taken 
away by the switching trains* This occasions the loss of the 
time of the men and teams, which amoimts annually to from $125 
to $150. It was also stated that sometimes, if such cars had not 
been removed, petitioner could have unloaded them in the free 
time allowed, and thereby saved a demurrage charge. The 
amount of demurrage paid by petitioner annually is estimated 
at $25 per year. 

Cars are switched to and from the public delivery^ tracks in 
Berlin on an average of twice a day, each switching consuming 
about three-fourths of an hour. 

To obviate petitioner's complaint, the respondent offers to 
place petitioner's cars on a track sitttated on the property of the 
electric light pfent, which is about six blocks distant from peti- 
tioner's lumber yard. Cars placed upon this track would not be 
disturbed for from twenty-four to forty-eight hours, giving the 
petitioner ample time to unload the same. The point ni which 
petitioner customarily imloads its cars upon the public delivery 
track is less than 1,(K)0 feet distant from its lumber yard. Peti- 
tioner receives about 120 to 140 cars annually. 

The switching is usually done in the forenoon. Train No. 
765, which is due to arrive at Berlin at 8 :45 a. m., and to leave 
at 9:40 a. m., allows 55 minutes for the purpose of turning the 
eiig^ine, placing of loaded cars upon the public delivery tracks, 
and removing therefrom empty cars, and making up the train. 
Switching is also done by the train (\ut at 11:50 a. m., which 
usually consumes from thirty to forty minutes. 

The respondent contends that it cannot perform the switching 
service at night, because it would be required to work its train 
crew beyond the working hours limited by statute. It is said 



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16 BAILBOAD COMMISSION OF WISCONSIN. 

that eliminating tlie switching in the forenoon, as suggested by 
petitioner, would discommode a large number of other receivers 
of freight. It seems that on respondient's entire system, and 
where public delivery tracks are maintained, the switching of 
cars takes place from once to twice a day. This is absolutely 
necessary in railroading, in order that cars be expeditiously 
moved. 

Teaming or public delivery tracks are facilities furnished the 
public in general for the unloading of freight from cars directly 
into wagons or other vehicles. Cars set upon such tracks are 
necessarily moved at times before being unloaded, in order to 
place other cars upon the tracks and to remove empty cars 
therefrom. No doubt such shifting of oars results in occasional 
inconvenience and loss to the receivers of freight who do their 
unloading from the public delivery tracks, but this seems to be 
inevitable in railroading. To permit a car to remain in a par- 
ticular place until unloaded might delay the putting into service 
of other cars which have been unloaded, and also the placing of 
loaded cars for unloading. Thus, a number of shippers need- 
ing empty cars for loading, and receivers needing freight, might 
be inconvenienced in order to accommodate an individual re- 
ceiver. All that can be required of the railway company under 
the circumstances is that reasonable care shall be exercised in the 
matter, so that no unnecessary inconvenience will result to any- 
one who is obliged to receive his freight upon a public delivery 
track. The contention, that the company should bear any loss 
that the consignee might suffer because of delay in unloading 
cars occasioned by switching the same for the purposes men- 
tioned during the process of unloading, is not tenable. Besides 
opening the door to rebates and discriminations, such a rule 
would penalize the company for an act which, in the very nature 
of the situation, arising from its legal obligation to the public 
in general, it could not avoid. The law impliedly recognizes that 
public delivery tracks are, of necessity, more or less inadequate 
for the receiving and' delivering of freight in carload lots at 
industries, and therefore provides that the owners of such in- 
dustries may construct private tracks and connect the same with 
the tracks of the railway company within its yard limits. 

One of the complaints lodged by the petitioner against the 
railway company is, that the time occupied in switching cars 
which have once been placed for unloading is taken out of the 



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AIiLEXN LUMBER CO. V. 0. M. A ST. P. B. CO 17 

free time allowed for unloading the same. It would seem, upon 
first impression, that it is inequitable to charge to the consignee 
of freight the time thus consumed by the railway company in 
switching the cars after they have been placed for unloading, 
during which time the consignee is deprived of access to the cars, 
but, notwithstanding such apparent injustice, the question arises 
whether the remedy suggested by the petitioner, of allowing ad- 
ditional compensatory time for unloading, would not result in 
discriminations and rebates of the worst character, which would 
be difficult to detect and more difficult to prove. If time were 
to be added to the free time now provided by the demurrage 
rules in effect, because of the occasional moving of cars after 
they have been placed upon public teaming tracks for unloading, 
there would be no limit to the controversies between receivers of 
freight and railroads over claims for additional time for unload- 
ing. Obviously, it would be practically impossible for the rail- 
roads to keep track of the time consumed in switching, and par- 
ticularly of the time any individual receiver was deprived of 
access to a particular car by reason of the switching. Under the 
circtunstances it would, in most cases, be impossible to success- 
fully resist any claim for such additional time, however unjust 
and unreasonable the same might be. It would certainly be bet- 
ter for shippers generally to suffer an occasional loss resulting 
from the application of a general and invariable rule, than to 
suffer the evils of discriminations and rebates which would be 
the inevitable consequence of the plan suggested. The demur- 
rage rules now in effect are adequate in most instances to equal- 
ize fairly well the loss of shippers and railroads occasioned by 
delays in unloading cars. They provide for average agreements 
between shippers and carriers, whereby a credit of one day may 
be allowed for each car released within the first twenty-four 
hours of free time, and a debit of one day may be charged for 
each twenty-four hours, or fraction thereof, that a car is de- 
tained beyond the first forty-eight hours of free time. 

We fail to see how we can remedy the evils of which com- 
plaint is here made without giving opportunity for the indul- 
gence of practices which the law here invoked was designed 
to abolish. For the reasons stated, the petition will be dismissed. 

Now, Therefore, it is Ordered, That the petition be and 
the same is hereby dismissed. 
2— R. D. 



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I 
I 

18 RAILROAD COMMISSION OP WISCONSIN. I 



C. & J. MICHEL BREWING COMPANY 

VS. 

CHICAGO AND NORTH WESTERN RAILWAY COMPANY, 

CHICAGO. ST. PAUL, MINNEAPOLIS AND OMAHA RAILWAY COM- 
PANY. 



Decided Nov. 17, 1910, 



Petition alleging exorbitant charges on a carload of beer from La 
Crosse, Wis., to Rice Lake, Wis., respondents baring charged 
the Wisconsin distance tariff, fifth class rate, while a lower 
commodity rate was in effect between La Crosse and Su- 
perior, Wis., Rib Lake being an intermediate point between 
said two stations; subsequently said commodity rate was made 
applicable to Rice Lake. 

Held: That the rate charged the petitioner by respondents was un- 
usual and refund ordered. 

The petitioner is engaged in the brewing and sale of malt 
liquors at I^a Crosse, Wis. It alleges that on March 15, 1910, it 
shipped a carload of beer weighing 30,010 lbs. to Rice Lake, 
Wis., over the lines of both of the above respondents, for which 
shipment it was compelled to pay freight charges of 20^^ cts. per 
cwt., which rate is arrived at by the application of Wisconsin 
distance tariff, fifth class rate. It further alleges that a com- 
modity rate on beer in carload lots from La Crosse to Superior, 
Wis., of 17% cts. per cwt. was in effect at the time the consign- 
ment referred to moved from La Crosse to Rice Lake, the said 
rate being authorized in C. & N. W. G. F. D. No. 10567-A, 
C. St. P. M. & O. G. F. D. No. 770-A, section 2, page 30, item 
137. It contends that the commodity rate of 171/2 cts., referred 
to as applying from La Crosse, Wis., to Superior, Wis., should 
govern on the carload assignment forwarded from I^ Crosse to 
Rice Lake, Wis., owing to the fact that the latter station is an 
intermediate point on direct line over which consignments receiv- 
ing a rate of 171^ cts. per cwt. from La Crosse, Wis., to Su- 
perior, Wis., move, and further because of existing competitive 
conditions in that territory that originates from Superior, Wis., 
and Duluth, Minn., to which latter point the rate in question also 
applies. Wherefore, petitioner prays that reparation be made 



I 



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C. & J. MICHEL BKBWINQ 00. V. C. A K. W. R. CO. ET AL. 19 

to the extent that the defendant railway companies be ordered 
to refund the sum of $9. 

The respondent Chicago, St. Paul, Minneapolis & Omaha Rail- 
way Company, answering the petition, admits all the formal al- 
legations thereof and also admits that the c<Mnmodity rate on 
beer in carload shipments from La Crosse to Superior, Wis.^ 
was 17% ots. per cwt. at the time the shipment ittvolved herein 
moved ; that said rate was then published to meet cconpetition of 
short lines through the short route, which is via St* Paul, but 
denies that the commodity rate of 17i/^ cts. per (jw^t. governs car- 
loads shipped from La Crosse to^Ricc Lake, and alleges that a 
rate of 20% cts. assessed against this consignment involved 
herein, is a fair and reasonable charge. The respondent further 
alleges that said rate is % ct. less than the rate on the same com- 
modity in carloads from Milwaukee to Rkre Lake. 

The respondent Chicago & North Western Railway Company, 
in its answer to the above petition, admits all the formal allega- 
tions and also admits that at the time said shipment moved there 
was a commodity rate on beer in carload shipments from La 
Crosse to Superior of 17% cts., as stated in said petition, but 
such rate was only made applicable to Rice Lake subsequent to 
movement of shipment in question. 

The claim was submitted upon the pleadings, vouchers and 
documents on file. 

The charges exacted of the petitioner for the shipment in 
question were based upon the rate prescribed in the fifth class 
of the distance tariff. This was the only rate that could be law- 
fully applied to such shipment. There was in effect at the time 
such shipment was made a commodity rate of 17% cts. per cwt., 
applicable to shipments of beer in carload lots from La Crosse to 
Superior, and subsequently this rate was made applicable to Rice 
Lake. Rice Lake is an intermediate point and should have been 
protected by the Superior rate. There is nothing in the traffic 
situation relative to the transportation of beer that warrants 
charging a higher rate on same when moving from La Crosse to 
Rice Lake than when moving from La Crosse to Superior. It 
appears that Rice Lake is quite a distributing center for beer, 
and that petitioner is brought into sharp competition at such 
point with competitors in St. Paul, Minn., who enjoy a rate of 
10 cts. per cwt. on carload shipments of beer from St. Paul to 
Rice Lake. Under the circumstances it would seem that the 



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20 RAILROAD COMMISSION OF W1S00N8IM. 

rate exacted in the instant case is unusual and unjust and that 
the reparation asked should be awarded. 

We therefore find and determine that the rate of 20^ cts. per 
cwt., charged the petitioner by the respondents for the aforesaid 
shipment of beer from La Crosse to Rice Lake, is unusual, and 
that ny^ cts. per cwt. would have been a reasonable rate for 
the services rendered in transporting said beer as aforesaid. The 
amount of the reparation to be awarded is $9. 

Ordered, That the respondents, the Chicago & North Western 
Railway Company and the Chicago, St. Paul, Minneapolis & 
Omaha Railway Company, rqfund to the petitioner, C. & J. 
Michel Brewing Company, the sum of $9, being the amount of 
excess charge exacted of the said petitioner by the said respond; 
ent on the aforesaid shipment of beer. 

The first carrier above named will make the reparation 
awarded and collect from its co-respondent the proportionate 
share thereof chargeable to the latter. 



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YAWKEY-BISSEL LUMBER CO. V. C. A N. W. R. CO. 21 



.AWKEY-BISSBL LUMBER COMPANY 

vs. 
CHICAGO AND NORTH WESTERN RAILWAY COMPANY. 



Decided Nov. 11, 1910. 



Petition alleging overcharges on two shipments of lumber, such ship- 
ments having been made on flat or gondola cars and the re- 
spondent refusing to make an allowance of 500 lbs. per car for 
stakes, according to its published tariff. 

Held: That the charge exacted was erroneous and refund ordered. 

Petitioner is a corporation engaged in the lumber business at 
Arbor Vitae. It alleges that by virtue of respondent's tariff 
G. F. D. 5600-A, effective Sep. 1, 1906, the respondent should 
make an allowance of 500 lbs. per car for stakes used on shif)- 
ments of lumber loaded on flat or gondola cars, and moved under 
said tariff, but notwithstanding the company refuses to make 
such allowance for car stakes. It further alleges that it shipped 
one gondola car of lumber from Arbor Vitae to Vesper, Wis., 
upon which it was entitled to an allowance of 40 cts. for car 
stakes, and that on March 10, 1910, it shipped one gondola car 
of lumber from Arbor Vitae to Blue Mounds, Wis., on which it 
was entitled to an allowance of 55 cts. It further alleges that 
tlie failure to make the aforesaid allowances resulted in charginii: 
petitioner in excess of the amount that should have been charged, 
according to said tariff. Wherefore, petitioner prays that the 
respondent be authorized and directed to refund to it said 95 cts. 

The respondent admits that the petitioner is entitled to the 
reparation asked. 

The case was submitted on the pleadings, papers, documents 
and correspondence on file. 

It appears on investigation that for a long time prior to the 
shipments in question, respondent's tariff 5600-A contained tlie 
following provision : 

"Freight transported under this tariff will be subject to printed 
rules and regulations in which are stated charges and rules relat- 
ing to car service, storage, switching, reconsigning, weighing and 
inspection." 



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22 RAILROAD COMMISSION OF WISCONSIN., 

Th^rc arc also on file respondent's (i. F. D. 7950, being "rules 
and regulations'' referred to in the above tariff, and governing 
all shipments on respondent's lines. G. F. D. 7950 seems to 
have been canceled, and consequently the provision relating to 
allowance for car stakes was no longer in effect. However, sub- 
sequently the respondent re-issued its rules and regulations, 
which restored the provision allowing 500 lbs. for stakes on 
shipments of forest products in open cars, but it was contended 
by respondent that as tariff 5600-A did not specifically refer to 
such re-issuing of the rule granting an allowance of 500 lbs. for 
stakes, the shipments in question were not covered by such pro- 
vision. We think this construction is too narrow, and the com- 
pany itself has since taken a different view, and allows 500 lbs. 
for stakes when lumber is shipped in flat or gondola cars. 

Under the circumstances we find and determine that the charge 
exacted of the petitioner for the afcresaid shipments was erro- 
neous, and that a reasonable charge for such shipments would 
have been 55 cts. less than the amount exacted of the petitioner 
by the respondent, because of the failure to allow for car stakes 
as aforesaid. 

Now, Therefore, It is Ordered, That the Chicago & North 
Western Railway Company refund to the Yawkey-Bissel Lum- 
ber Company the sum of 95 cts. 



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HALL V. C. M. A ST. P. B. CO. BT AL. 23 



CHARLES G. HALL 

vs. 
CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY. 

CHARLES G. HALL 

vs. 
MINNEAPOLIS, ST. PAUL AND SAULT STE. MARIE RAILWAY 
COMPANY. 



Submitted Sep. 12, 1910. Decided Nov. g«, 1910. 



Two separate complaints were filed, alleging inadequate station facili- 
ties at Duplainvllle, Waukesha county, Wis., neither of re- 
spondents maintaining a freight or passenger station at said 
point. 

Held: That the station facilities at Duplainvllle are wholly inadequate 
and it is ordered that each respondent construct a building 
suitable for a passenger station at said point. 

The petitioner filed a separate petition against each of the 
above named carriers, alleging that neither of said carriers main- 
tains a freight or passenger station at Ehiplainville, Waukesha 
county, Wis. ; that each of said carriers stops* passenger and 
freight trains at said point for the purpose of accommodating 
travelers and shippers and receivers of freight; that passengers 
seldom purchase tickets, because tickets are only sold at the 
signal tower located at the point where the tracks of said rail- 
roads cross each other, which is about 450 feet from the point 
where the trains stop; and that, as there is no shelter or protec- 
tion against rain or cold at the platform where the trains stop, 
passengers awaiting the arrival of trains, and those getting off 
trains, are often subjected to rain and cold. Petitioner further 
alleges that the Chicago, Milwaukee & St. Paul Railway Com- 
pany stops two passenger trains going east and three going west 
daily at Duplainville for the purpose of receiving and discharg- 
ing passengers, and that the Minneapolis, St. Paul & Sault Ste. 
Marie Railway Company stops at said place two passenger trains 
going north and two going south daily for the purpose of re- 
ceiving and discharging passengers. The petitioner prays that 
each of said railway companies be required to furnish adequate 
station facilities at Duplainville. 



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24 RAILROAD COMMISSION OF WISCONSIN. 

The Chicago, Milwaukee & St. Paul Railway Company, an- 
swering the petition filed against it, denies that there is any rea- 
sonable necessity for the installation of more adequate station 
facilities at Duplainville than are at present maintained at that 
point. 

The Minneapolis, St. Paul & Sault Ste. Marie Railway Com- 
pany, answering the allegations of the petition filed against it, 
sets forth that it is willing to furnish reasonable shelter for 
passengers at Duplainville and to place the same in charge of 
the tower man employed at that point, and requests that the 
matter be determined upon such basis. 

Both of the above entitled matters were heard on Sep. 12, 
1910. Aleck Caldwell represented the petitioner and F. G, 
Wright represented the Chicago, Milwaukee & St. Paul Railway 
Company. The Minneapolis, 'St. Paul & Sault Ste. Marie RrjI- 
way Company was not represented. 

Duplainville is a hamlet situated at the junction of the re- 
spondents' railroads. It has one store, blacksmith shop, wagon- 
maker's shop, pickle house, and two saloons. About 95 cans of 
milk are shipped from this point daily to Milwaukee. There is 
no place near the platforms, where the trains stop, except the 
two saloons, where passengers can await the arrival of trains. 
They usually remain out-doors and often suffer from the ele- 
ments. The number of passengers taking trains at this point 
and those departing from trains is not great. It was estimated 
that approximately ten people daily board trains at this point. 
The record of the Minneapolis, St. Paul & Sault Ste. Marie Rail- 
way Company shows that for the year ending April 30, 1910, 
843 passengers boarded its trains at this point, and the revenue 
derived from them amounted to $122.69. We have no statistics 
showing the amount of passenger traffic of the Chicago, Milwau- 
kee & St. Paul Railway Company at this point, excepting for 
the month of May, 1910, which show receipts from passengers 
to the amount of $14.34. 

Complaint is also made that shipments of less than carload 
freight are unloaded and allowed to remain on the platforms, 
unprotected from the weather. During the winter the platforms 
are often covered with snow and slush, and as a result receivers 
of freight occasionally suffer damage because of freight becom- 
ing wet when placed on the platforms. The Chicago, Milwau- 
kee & St. Paul Railway Company contends that no claim for 



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HALL V. C. H. A ST. P. B. CO. £T AL. . 25 

damage to freight for the reason stated has ever come to its 
knowledge, prior to the hearing. 

Both the respondents have expressed a willingness to provide 
adequate station facilities at Duplainville. According to counsel 
for the Chicago, Milwaukee & St. Paul Railway Company, the 
matter of constructing a station for the joint use of the respond- 
ents has been under consideration, but the plans have not ma- 
tured as yet. Relying upon the statement that a suitable pas- 
senger station would be constructed, we delayed acting in the 
premises, but as cold weather is approaching, and no steps have 
been taken to carry out the proposed plan, we deemed it neces- 
sary to move in the matter. 

We find that the present station facilities maintained by the 
respondents at Duplainville are wholly inadequate for the con- 
venience and comfort of passengers who leave the cars at that 
point, and that to properly discharge their obligations to the 
public, the respondents should each construct a building suitable 
for a passenger station at Duplainville. The two companies 
may, at their option, join in the construction of a union station. 

The character and dimensions of the stations to be constructed 
are matters to be determined in the first instance by the railway 
companies themselves. We cannot prescribe any plans or speci- 
fications for such buildings. 

Now, Therefore, it is Ordered, That the Cliicago, Mil- 
waukee & St. Paul Railway Company construct a passenger 
station at Duplainville, adequate to meet the reasonable require- 
ments of the community. 

Now, Therefore, it is Ordered, That the Minneapolis, St. 
Paul & Sault Ste. Marie Railway Company construct a passenger 
station at Duplainville, adequate to meet the reasonable require- 
ments of the community. 

Sixty days is deemed a reasonable time to comply with these 
orders. 



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S6 , RAHiROAD COMMISSION OP WlsC0NSll4. 



THOMAS KIRWIN jst al. 

vs. 
CITY OF DARLINGTON. 



Subynittcd Oct. 25, 1910. Decided Dec. 1, 1910. 



Petition alleging that although the city had established a schedule 
oX water rates, such schedule had never been enforced, but a 
flat rate to all consumers, with few exceptions, had been es 
tablished, which flat rate is the minimum rate fixed by the 
ordinance; that said flat rate Is the same to all consumers, 
with certain exceptions, irrespective of the amount of water 
consumed, the purposes for which It is used, or the fixtures 
in use; that the said rates, and also the special rates granted 
in certain cases, are inequitable, unjust and discriminatory; 
that free service is furnished in certain cases; and that no 
account of the operating expenses of the water department 
has been kept. 

The testimony showed that no record had been kept showing the num- 
ber of openings and fixtures in use by consumers; that no 
meters are installed; that no record of expenses has been kept 
and no report made to this Commission; that all expenditures 
have been paid out of the general fund of the city; that no 
hydrant rental or other payment for public use of service has 
been provided for; that the ordinance, establishing flat rates 
on the UBual basis, has. been disregarded; that discriminations 
in rates are quite general. 

A tentative valuation of the plant, made by the engineering staff of 
this Commission, places the value of the plant new at $25,586, 
and present value at $22,943. An apportionment of this value 
between public and private use shows that 50 per cent thereof 
1b devoted to public use. 

A comparison of the water used per capita in Darlington with that 
used in other cities of the state, show% that the amount is 
very large for Darlington and there is strong evidence through- 
out that the waste of water is very great. The plant has not 
been made to feel, in a direct way, the increased costs due 
to the wasteful use of water, the pumping being done under a 
favorable contract, but the city cannot expect that the con- 
tract will be renewed at a price as favorable as that now given. 

Owing to the scarcity of statistics as to consumption, operating ex- 
penses, etc., of the Darlington plant, it is obvious that any 
rates that can be advanced at the present time can but be of 
a more or less temporary nature and must be based mainly 
on estimates and comparisons with conditions In other cities 
and localities from which more complete data are available. 
A schedule of rates is ordered, including an annual hydrant 
rental to be paid by the city, but it is understood that these 
rates are subject to such changes as the Commission may 
deem proper later on. It is also ordered that respondent pro- 



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KIRWIN ET AL. V. CITY Of DAELmGTON. 21 

Vide meters for all customers connected with sewers or cess- 
pools, and tliat all free service for public or private purposeii 
be discontinued. 

The petition of the abov^e named Thomas Kirwin and twenty- 
five other consumers and users of water from the said city of Dar- 
iijigion water system and plant sets forth the following alle- 
gations and complains: 

That said city of Darlington is a municipal corporation in La 
Fayette county, state of Wisconsin, with a population of about 
2,000 people, owning and operating its own water works system 
and plant, and is a public utility furnishing water and power to 
its citizens at certain fixed rates. 

That the petitioners are informed and believe that the city has 
expended in building, establishing and extending the water works 
system the sum of $25,586, and the waterworks system has a 
piescnt existing vaiue of $22,943. That at about tire time the 
water works system was established, the city of Darlington 
passed and adopted an ordinance establishing a schedule of water 
rates. That this schedule of rates, as set forth in the ordinance 
above named, has never been enforced, and in lact has been 
wholly disregarded, and in place thereof the city has established 
a flat rate to all consumers, with a few exceptions, which flat 
rate is the minimum rate fixed in the ordinance. 

That the city is and has been demanding and collecting for a 
a nimiber of years past a flat rate of $6 per year from all the 
consumers, with the exceptions hereinafter noted, irrespective 
of the amount of water used by the various consumers. That 
this flat rate of $6 per year is inequitable, unjust and discrimin- 
atory, in that it demands and collects from a great nimiber of con- 
sumers who have water closets, lavatories, water lifts, bath tubs, 
etc., the same amount as is demanded of those consumers who 
use water for drinking and cooking purposes only and have none 
of the conveniences a1x)ve mentioned. 

That the city of Darlington has made some exceptions in its 
rates and has established certain special rates for hotels, livery 
stables, saloons, ice cream parlors, county jail and court hous?, 
k'undries, street sprinkler, C AI. & St. P. Ry. Co., photograph 
gallery, lumber yards, doctors' offices, and a few stores, printing 
ofikes, and pop factory, all of which special rates are believed to 
be inequitable, unjust, and inadequate and discriminatory. That, 
in addition to the above special rates, the city has made further 



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28 BAILROAD COMMISSION Of* WISCONSIN. 

discriminations in its rates by demanding from certain consumers 
ii rate of $3 per year, and demanding $6 per year from other 
users to whom it renders a like, identical and similar service. 

The petition also sets forth that the city furnishes service to 
the churches and pubHc schools and the La Fayette Agricultural 
Society free, which practice is alleged to be discriminatory. It 
is also alleged that the city is furnishing water to a number of 
its consumers for sprinkling lawns, gardens and for various other 
uses, for which service no compensation is demanded or received. 

The petition also states that it is believed that the gross income 
received by the city for the rendering of water supply service 
will not exceed the simi of $2,500 per annum, all of which 
amount is placed in the general fund of the city, and no account 
is kept of the operating expenses of the water plant 

The petition asks that the Commission investigate the situa- 
tion in Darlington and order and establish a just and equitable 
rate schedule for water service, which shall produce sufficient 
income to meet all the legitimate operating expenses of the 
utility. 

A hearing was held in the above matter before the Commis- 
sion on Oct. 25, 1910, at which hearing the following appearances 
were entered: /. K. Carey, for petitioners; /. H, Kccfc, city 
clerk, and C D. Huntington, member of the common council, for 
the city of Darlington. 

It was brought out in the testimony at the hearing that no 
record has been kept by the city showing the number of openings 
and fixtures in use by the consumers ; that no meters are in use 
for measuring the water supplied to consumers ; that no record 
of expenses of the water plant has been kept by the city. It 
further appears that no report of expenses has ever been made 
by the city to this Commission. No hydrant rental or any other 
form of payment for public use of the service seems to be pro- 
vided for. 

There seems to be no need of going into the matter of dis- 
criminaitions between consumers in Darlington. It appears from 
the testimony tHat the situation in this respect is as alleged in 
the complaint and need not be enlarged ujpon herein. A state- 
ment of the number of fixtures in use by each consumer in the 
city, and the annual rate paid by each consumer, has been pre- 
pared and submitted to the Commission, and these data will be 
summarized later in this decision. No comments are necessary 



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KIBWIN ET AL. V. CITY OP DARLINGTON. 29 

in connection with this tabulation of the rates charged in Dar- 
lington to emphasize the general inequity and injustioe of the 
schedule as applied. 

The Commission has had occasion in previous decisions to 
ccxnment upon the matter of flat rates for water service. "Mat 
rates for water, it may safely be said, are seldom, if ever, closely 
based on a cost analysis. In the very nature of things they can- 
not so conform, since the rate is an estimate on an assumed 
average." City of Ripon v, Ripon Light & Water Co, 5 W. R. 
C. R. 1, 80. 

It seems that little can be said in favor of a universal use of 
flat rates in Darlington. Flat rates, in order to be justifiable in 
any measure, should be based upon the number and kind of fix- 
tures, size of opening, or similar basis. In this instance, how- 
ever, it appears that even any attempt to base the rate upon some 
reasonable basis has been neglected and the flat rate in force 
bears little, if any, relation to fixtures in use, size of opening, 
rooms, or any other more or less reasonable classification. The 
rates -in force in Darlington, then, appear to be open not only to 
the usual objections made to flat rates generally, but are even 
more objectionable and unjustifiable because even the factors 
taken into consideration in devising a flat rate schedule are neg- 
lected in this case. 

It appears that the original ordinance provided for the estab- 
lishment of flat rates to be computed on the usual basis of flat 
rates for water, namely, rooms, fixtures, families, etc., but that 
the regular rate schedule has not been enforced; and all condi- 
t'ons haive grown steadily worse until today tl:c rates are dis- 
criminatory and in disorder throughout. 

The following summary gives the valuation of the physical 
property of the Darlington water works as determined by the 
Commission's staflF. It will be noted that the valuation is 
of date May 15, 1909. Since no reports have been made by the 
plant to the Commission, dther as regards operating expenses or 
expenditures for renewals and additions to the plant, and since 
no records of such expenditures have been kept by the city, we 
are unable to determine the exact extent and amount of the ad- 
ditions since the tentative valuation. We are, however, con- 
vinced from the testimony and other sources that the additions 
have been slight, and will not, at least not materially, aflPect the 
results in this matter. 



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30 



RAILROAD COMMISSION OP WISCONSIN. 



TENTATIVE VALUATION. 

DABLIXGTON MniCIGIPAL WATEHWoRKt«. 

May try, 1909. 



1. Land 

2 . Wells, intakes and suctions 

8. Reservoir 

4. rHstrlbution system 

5. Pumpln«r plant equipment 

6. Buildings and mlsceUaneous structures. 

7. Office furniture and appliances 

8. Tools and Implements 

9. Horses, wagons and miscellltneous 



Total. Items 1-0 

10. Add 10% (seenotebelew). 



Total, Items 1-10. . 

11 . Stores and supplies . . 

Total, items 1-11. 

12. Paving 



TotaM terns 1-12... 
13. Unoperated property. 

ToUl, items 1-13... 



Cost new. 



Present 
value. 



9100 
3&^ 
1,3J» 
18.643 
1.203 
1.420 



15 



t23.138 
2,314 



125,452 
3 



925,465 



925,455 
131 



925,686 



9100 

320 

1.119 

17.701 

349 

1.20: 



s 



920.8114 
2.0»0 



r22.884 
3 



922,887 



922,887 
56 



922,943 



Note:— Addition of 10<t to cover engineering, supervision. Interest during construc- 
tion, contingencies, etc. 

It appears that the city owns, as part of the plant, a steam 
pumping equipment. It also appears that this equipment is sel- 
dom used and that, in fact, the pumping is done by the Darling- 
ton Electric Light & Water Power Company under a contract 
with the city. 

Operating Revenues and Expenses. 

It has been noted previously that the city has kept no separate 
accounts of the expepses of the water works. All expenditures 
for repairs, labor, .etc., have been from the general fund. We 
are therefore compelled to depend, to a large extent, upon esti- 
mates in this case in order to arrive at a fair and reasonable 
statement of the yearly operating expenses of the plant, these 
estimates to be guided by the facts available in respect to the 
Darlington plant and the experiences of similar plants. 

It appears from the testimony of witnesses at the hearing that 
the Darlington Electric Light & Water Power Company is under 
contract to furnish the street lighting service and do the pump- 
ing for the city. From the testimony and from the report of the 
electric utility above named it appears that the charge for pump- 
ing has been alx>ut $75 per month, or $900 per year. The city 



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KIRWIN BT AL. V. CITY OF DARLINGTON. 



31 



clerk estimated the total operating expenses of the plant as ap- 
proximately $1,391.89. This amount included the cost of pump- 
ing, main repairs, incidentals, and costs of collection, but did not 
include general expenses, depreciation, and interest on invest- 
ment. The general office work is done by the city clerk, who is 
paid from the general fund, and no part of his salary is charged 
against the water department. The city has no superintendent 
of the water works, but the repair work, connections, etc., are 
looked after by the city marshal and by local plumbers. 

It was stated by the city clerk that the revenue from water 
rentals amounted to about $2,336.50 for the past year. TMs 
amount is received entirely from private consumers, as the city 
pays nothing for public use nor for school houses, etc. 

It appears that the pump used by the electric utility to furnish 
water supply for the city of Darlington is a triplex pump, 6.5 
inches by 8 inches, with a capacity of about 3.45 gallons per 
revolution. This pump makes 42 revolutions per minute and is 
operated 24 hours per day. From these figures it was computed 
that the daily pumpage would be from 214,000 to 225,000 gallons 
per day. The yearly pumpage is, then, about 80,000,000 gallons, 
or at the rate of about 43.4 thousand gallons per inhabitant per 
year, using a population of 1,843 (1905 census). This allows 
for no slippage in the pumps, which in the type used should be 
in the neighborhood of 5 per cent. The following table has been 
prepared showing the total pumpage (no allowance for slip- 
pa.q:e), population 1905, and the pumpage in thousand gallons 
per inhabitant for seventy-one Wisconsin water utilities: 

PT'MPAGE STATISTICS. 
Year Ending June 30, 1910. 



City. 



St. Croix Falls 

(iUdden 

Mazomanie 

Benton 

Glen wood 

Fennlmore 

\jod\ 

Sprlnsr Valley 

Onalaska 

Shulljtburer 

Lake Mills 

Ladysmith 

Evansrille 

Black River Falls. 
Mellen 



M fifallons 


Population 


M irallons per 


pumped. 


1905. 


Inhabitant. 


2.199 


612 


3.6 


3.650 


800 


4.6 


6.500 


863 


7.5 


10.950 


903 


12.1 


9.110 


905 


10.1 


3,069 


1,053 


2.9 


14.600 


1,096 


lf.3 


2.850 


1,103 


3.3 


12.000 


1,106 


10.9 


9,125 


1.153 


7.9 


32,850 


1,602 


20.5 


9. 825 


1.720 


5.7 


16.000 


1.9(33 


8.1 


36,500 


1.946 


18.8 


31,348 


1.700 


18.4 



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32 



RAILROAD COMMISSION OF WISCONSIN. 



PUMPAGE STATISTK^S.-Contliiuwl. 
Year Eitdino June 30, 1910. 



City. 



M flralloDs 


Population 


M gallons per 


pumped. 


1905. 


inhabitant. 


87.600 


1.857 


47.1 


14.639 


1,793 


8.2 


9.000 


1.445 


62 


41.277 


2.675 


15.5 


54,3130 


2.625 


20.8 


71.577 


2 41(3 


29.7 


27.375 


2,555 


10.7 


10.540 


2.117 


5.0 


.5.700 


2,722 


2.1 


8G.180 


2,873 


30.0 


42,647 


2,913 


14.7 


75.000 


3.300 


22.7 


145.305 


3.220 


45.2 


65,000 


3.449 


18.8 


41.862 


3,013 


13.9 


139,971 


.3.811 


36.7 


110.495 


3,807 


29.0 


60.000 


3.008 


20.0 


54.750 


3.111 


17.6 


75.600 


3.108 


24.3 


49,471 


4.638 


10.7 


72,8(X) 


4,523 


16.1 


80,420 


4.991 


16.1 


75,000 


4.229 


17.7 


50.771 


4.4H8 


11.5 


60,975 


i.oaA 


15.1 


92.690 


4,244 


21.8 


24,750 


4,924 


5.2 


140.795 


5.524 


25.5 


171.747 


5,284 


:c.5 


299,088 


5,835 


51.3 


302,000 


5.615 


.53.8 


79.000 


5.960 


13.2 


63.403 


5.473 


11.6 


244,735 


5.722 


42. M 


182.379 


6,663 


27.3 


1(6.187 


6,157 


16.6 


156.240 


6.047 


25.8 


197,752 


6,949 


28.:. 


291.513 


8.622 


33.8 


288,556 


9,197 


31.3 


193.436 


9.022 


21.4 


729.615 


12.855 


56.6 


3.X3.337 


12,733 


27.7 


3.-»8.4l9 


13.770 


26.1 


600.000 


14.458 


41,5 


432.504 


14.519 


29.8 


594.949 


15,3.^4 


38.7 


586.166 


17.000 


34.5 


778.270 


17,284 


45.0 


433.057 


22,851 


18.9 


608.011 


24.301 


25.0 


1,094.838 


29,078 


37.6 


1,096,337 


30.575 


35.8 


9%t.849 


32,290 


29.0 


615.857 


36,551 


16.9 



Mauston 

MayviUe 

Mondovi 

Bai'fleld 

Burlinffton 

Edirerton 

Lancaster , 

NeillsvUle 

Stanley 

Waupaca 

Wauwatosa , 

Fort Atkinson 

Hudson , 

LakeCJeneva 

( >conomowoc 

Ripon 

Sparta 

Tomah 

Waupun 

Whitewater 

Berlin 

I)e Pere 

Kaukauna 

Monroe 

Platte vllle 

Port Washliiflrton. 

Stouffhton 

Washburn 

Portaire 

Houth Milwaukee 

Baraboo 

Beaver Dam 

Menasha 

Menomonle 

Oconto 

Atitigro 

(irand Rapids 

Neenah 

Waukesha 

Watertown 

Merlll 

Stevens Point 

Belolt 

Manitowoc 

Janesville 

Wausau 

Ashland 

Marinette 

Appleton 

KondduLac 

(jreen Bay 

Madison 

La Crosse 

Oshkosh 

Racine 

Superior 



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KIBWIN BT Ali. V. C5ITY OP DARLINGTON. 



33 



PUMPAGE STATISTICS- -Concluded. 
Yeab Ending June 30, 1910. 



Cities under 5, 000: 

Atreracre 

Maximum 

Minimum 



Cities over 5,000: 

Averwfe 

Maximum 

Minimum 



All cities: 
Averatre... 
Maximum. 
Minimum . . 



City, 



M irallons per 
Inhabitant. 



15.6 

47.1 

2.1 



31.4 
56.6 
11.6 



21.9 

56.6 

2.1 



The foregoing tabulation shows that the average pumpage per 
capita was 21.9 gallons for all the cities contained in the list. 
By comparison, the Darlington pumpage seems very large. It 
will be noted, however, that the average for the smaller cities 
(under 5,000) is considerably lower, being 15,600 gallons per 
capita, as against 42,000 for Darlington. That the very large 
pumpage per capita in Darlington is due, in a large measure, to 
the absence of meters, cannot be doubted. It is noted that there 
are an unusuah number of water motors in Darlington as com- 
pared with similar cities, and this is due undoubtedly to the fact 
that rates have been fixed regardless of the type and number of 
openings and fixtures. In fact, there is strong evidence through- 
out that the waste of water in Darlington is very great. No in- 
centive exists to prevent consumers from allowing fixtures and 
services to remain in a leaky condition, to prevent the running 
of water in the winter to prevent freezing of pipes, and to pro- 
mote a careful and considerate use of the service at all times. 
The burden is thrown equally upon all consumers, and the small 
consumer helps to pay the cost of supplying the large consumer, 
and the wasteful use of water by some consumers is paid for 
by others. 

All these conditions cannot help but affect the total operating 
expenses of the plant. This particular plant has been fortunate, 
or unfortunate, inasinucli as the pumping has been done under a 
contract and the city has*not been made to feel, in a direct way, 
the increased costs due to the wasteful use of the water by its 
consumers. It appears, however, that the .city cannot reasonably 
3— R. D. 



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34 



RAILROAD COMMISSION OF WISCONSIN. 



expect that the contract will be renewed at a price as favorable 
as that now given. That the metering of a large number of the 
consumers In Darlington, especially the large users and those 
most likely to waste the water, will reduce the total pumpage 
njaterially, will not be seriously questioned, and in fact may be 
expected. For this reason it would seem clear that a more fav- 
orable contract can be made for the pumping if a large per cent 
of the service were metered than if conditions remain as they 
now are. 

MrNICIPAL WATER WORKS 
In Citiss or Less than 5,000 PopdtjAtioh 





Total 

pump., 

h. p. 


Pumpage 

in M 
gallons. 


Commer- 
cial con- 
sumers. 


Miles 

of 
mains. 


Total 
expenses.* 


A IfToma 


180 
16 
150 
100 


164.250 


146 

31 . 
281 

14 

55 

180 

7 
177 
74 
95 

211 

68 
360 

83 
421 

86 


2.0 


12.566. 


Alma Center 


235. 


Kavfield 


41,277 
10,960 
5.443 


6.1 

.1 

1.4 

5.0 
1.1 
2.3 
.7 
2.3 

4.6 
2.2 
4.0 
3.6 
8.1 

1.3 

1,1 
8.6 
2.8 
2.3 

1.7 
4.2 
1.0 
1.2 
2.1 

8.2 
12.0 
3.0 


3.035. 


Hen ton 


597. 


Hloomer ' 


?72. 


Brodhead 




628. 


Colby 


m 

280 




• 595. 


Cumberland 




1.482. 


Deerfleld 




200. 


Dodge vllle 


120 

350 
90 
230 
200 
230 


10,050 

20,000 
1,978 
3,000 
3,069 

75,000 

9.110 

3,650 

145.905 


1,570. 


Elkhorn 


3,054. 


EHaworth 


'892. 


Elroy ^ 

r ennlmore 


3,654. 

1.449. 


Fort Atkinson 


2,223. 


Glen wood 


T97. 


Gtldden 


40 


479. 


] I udson 


615 
159 
103 

420 
164 
184 
47 
104 

306 
285 
128 
173 
352 

425 
173 
224 
112 


4,953. 


J uneau 


30 
00 


1,P76. 


Ladysmith 


9.828 

32,850 
14,600 
87.600 


2.718. 


Lake Mills 


1.245. 


I^odi 


150 


ore. 


M auston 


937. 


MerriUan 




404. 


Mondovl 


34 

75 
140 

50 
300 

280 

200 


9,000 

75.000 
10.540 
12,000 
60.975 


412. 


Monroe 


6,617. 


NeUlsville 


3.366. 


( inalaska 


1.311. 


Port Waahinirton 


1.393. 


KIce Lake 


5.0 

8.1 
10.0 


2.475. 


Richland Center 


2,527. 


Sharon 


14.600 


1.175. 


Shell Lake 


140 
50 


1.497. 


ShullsburfiT 


9.125 
66.700 

3.660 
1,800 
60,000 
86.180 
54.750 

42.647 
1.5.000 

26.244 

104.250 

1,800 


3.2 


1,879. 


Soldiers* Grove 


480. 


Surlng' Valley 




115 
112 
523 
380 
429 

357 
25 

"lor 

015 

i 


I.O 
3.7 
6.9 
7.3 
5.7 

1.1 


260. 


Sun Prairie 




979. 


Tomah 


120 
225 
223 

140 

1 44~ " 

350 
10 


6.004. 


W aupaca 


1,748. 


Waupun 


3,660. 


WauwatcKia 


3,096. 


West Bend 


800. 








A vera^re 


.T9 

12.0 

.1 


tl,79lT 


Maximum 


6.617. 


Minimum 


200. 







♦Does not Include depreciation and Interest. 



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KIBWIN XT AL. V. CITT OF DABUNGTON. 35 

It is further apparent, upon investigation, that the steam 
pumping equipment now owned by the city cannot be used exclu- 
sively. The plant will need overhauling and will, in a large 
measure, have to be replaced by new units if it is contemplated 
to use the city's steam plant exclusively. 

The foregoing tabulation gives the operating statistics of a 
number of the small municipal water utilities in the state and 
the total operating expenses of these plants. Total operating 
expenses, not including depreciation and interest, are averaged 
at $1,791. The average pumping station expenses of fifty small 
plants were found to be $1,780, average distribution expenses of 
twenty-nine small plants, $288, and average general expenses of 
twenty-seven small plants, $233. 

Interest and depreciation on the physical property of the 
water plant and system, figured at annual rates of 2 per cent de- 
preciation and 5 per cent interest on a cost new of $35,455, will 
amount to $509.10 and $1,272.75, respectively, or a total of 
$1,781.85. This total may be lowered somewhat by the use of 
an annual depreciation rate less than 2 per cent. The difference, 
however, between the amount of depreciation figured on a 2 per 
cent and a 1^^ per cent basis will not be over $130 per year. 

The facts in regard to the operating expenses of the Darling- 
ton water works have been stated insofar as they are known. It 
is clear that information is not in such form as to justify us in 
constructing a detailed income account, nor in attempting an 
apportionment of the expenses over the several branches of serv- 
ice and the several classes of expenses. It would appear from 
the facts available, however, that the total operating expenses 
of the phnt, including depreciation and interest on investment, 
will be in the neighborhood of $3,500 per year, of which amount 
interest and depreciation represent approximately 50 per cent. 
It is further apparent that the earnings of the plant fall consid- 
erably below the total revenue necessary to meet all the legiti- 
mate (grating expenses, which includes depreciation and inter- 
est on investment. 

In connection with the above facts there should also be taken 
into c(»isideration the probable increased cost of pumping under 
a new contract ; also the increased costs attendant upon a more 
or less general installation of meters. Depreciation and interest 
on the meter investment must be considered, together with the 
cost of reading meters and delivering bills, and repairing meters. 



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36 RAILROAD COMMISSION OF WISCONSIN. 

The Commission has discussed in previous decisions the rela- 
tions between the public and private use of water supply sys- 
tems, and the facts need not be repeated herein. It would seem 
advisable, however, to repeat here a quotation from an eminent 
authority on public water supply systems which defines most 
clearly the general functions of a water utility : 

"The functions performed by water works are: (1) To fur- 
nish water for private use; (2) to furnish water for public use, 
on streets, and for sewers, fountains, public buildings, etc. ; and 
(3) to furnish fire protection to property. In (1) and (2) the 
cost of service may be considered approximately proportional 
to the quantity of water supplied, but in (3) it is out of all pro- 
portion to the amount of water used, for while the cost of con- 
struction is greatly aflFected, the total amount of water consumed 
is slight. The extra cost in furnishing fire protection is due to 
largely increased pumping capacity, increased size of mains, 
services or standpipe, cost of hydrants and increased cost of 
maintenance." 

The investigations made by «the Commission's engineering staflF 
in connection with the apportionment of the value of physical 
property between public use and private or domestic use have 
shown that the proportion of the total property made necessary 
by and devoted to the public has in every case exceeded 50 per 
cent of the total. The expenses of a water plant are divided 
into two general classes: those expenses which are dependent 
upon and directly proportional to the output, which are called 
output or variable expenses; and those which are not directly 
proportional to and are independent of the output, which are 
termed capacity or fixed expens<^'s. The output or variable ex- 
penses should be distributed on the basis of the amount of water 
used: the fixed or capacity expenses should be divided between 
the several branches of service on the ])psi<; of the demand of 
investment required for or devoted to each branch of service. It 
is evident, then, that since 50 per cent or more of the value of 
the physical property has been made necessary by or is devoted 
to public use, 50 per cent of the total fixed or capacity expenses 
must be assessed against the public or city. If we assume that, 
in this case, depreciation and interest represent the fixed charges, 
wc have as the charge to the city $800 or more as its share of 
I he capacity expenses alone. The city's share of the output ex- 
l)enses depends upon the amount of water used for public pur- 
poses, and this is quite often a large proportion of the total 
consumption in cities of the same class as Darlington. 



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ttraWIN ET AL. l\ CITY OP DARLINGTON. 37 



DARI.INGTON Waiter Consumer Data. 

The following tables show, in a general way, the importance 
of the several classes of consumers, the fixtures and openings in 
use by the various consumers, and the free water users. Table I 
sliow^s the distribution of the fixtures, giving the total of each 
type: 

TABLE I. 
Distribution of Fixtures. 

Total number of water users .'?6« 

Water closets 151 

Bath tubs 91 

Lavatories 115 

Water lifts ^ 24 

Motors 10 

Motor fans 11 

Urinals 13 

Washing machine motors 4 

Other openings 605 

Table II gives the number of consumers of eai-li class, and 
shows the great predominance of residence consumers in Dar- 
lington. This table has been constructed from the data fur- 
nished by the city clerk. 

TABLE II. 

DlSTUIBlTION OF CONSITMKRS. 

Residences 28 1 

Stores 18 

Offices 12 

Shops 8 

Saloons 7 

Industrial establishments 7 

Livery stables 4 

Barns 4 

Hotels :J 

Restaurants 1 

Miscellaneous 5 

Table III shows the classificat'on of residence consumers 
according to fixtures in use. This table also shows the number 
in each group paying the several yearly rates for service. 



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38 



RAILROAD COMMISSION OF WISCONSIN. 



TABLE III. 

KbSIDKKCE COM8UMUBS. 



Consumers havlncr 



1. Water closets, bath tubs, lavatories, water lifts, 

motor, and other openings 

2. All Included in (l) excepting motors 

3.. Water closets, lavatories and other openings 

4. Water-closets, bath tubs and other openings 

b. .Water closets and other openings 

tf. Lavatories and other openings 

7. Bath tubs and other openings 

5. Motor and other openings 

9. Water closets only 

10. Having 'A or more other openings 

11. Having 2 other openings 

12. Having 1 other opening 



No. of con- 


ANNUAI 


sumers. 






•6.00. 


19 


19 


41 


40 




7 




2 




tf 




i 




1 




d 






1 


17 


17 


185 


164 



3.00. 



1 

*2i' 



Out of a total of 284 residence consumers, 261 are paying an 
annual rate of $6, while 23 are paying $3 per year. Inspection 
of the above tabulation will show that there is no relation be- 
tween the number and type of fixtures and the annual rate. One 
hundred and sixty-four consumers who had neither water closet, 
bath tub, lavatory, water lifts, or motor, but who had only other 
openings, paid the same rate as those possessing all of the con- 
veniences above described, together with other openings. Dis- 
criminations of this character are prevalent. "Other openings," 
as we understand the term, includes all openings not specifically 
enumerated, and covers kitchen faucets, yard hydrants, etc. 

Table IV presents the same statistics for stores and offices 
that are shown in table III for residences. 



TABLE IV. 
Store and Offigk Consumers. 



Ck>nsumers having 


No. of 
Consum- 
ers. 


ANA U All RATE. 


fis 


16 


«3 


Stores: 
1 . Water closets and other openings 


2 

I 
1 
1 
9 

1 
1 
1 
1 
3 








2. Water closets and lavatories 








3. Bath tubs and other openings 








4. Motors and other openings 






1 


5. Other ODeninirs alone. ...... T ...... T ..., . .-r 




2 




Offices: 

6. Water closets, bath tubs, lavatories, motors 
and other openings. 






1 


7. Lavatories, motors and other openings 






1 


8. Water closet^i, lavatories and otheropenings 






1 


9. Motors and other openings 


1 






10, other openings alone 




3 











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KIBWIN ET AL. V, CITY OF DARLINGTON. 



39 



Table V describes the consumers receiving free service in 
Darlington. There are also shown in this table the consumers 
from whom no collections were made. 



TABLE V. 

CoMsuMBRs Receiving Fkkk Water. 
Deaeriptinn . 



13 water closets: 1 motor to oiieratc veiittlatincr fan: 3urin- 
aLs; 7 other openings: 500 pupils, 

2 wat€r closets; 1 l>aUi tub: 1 lavatory; 1 motor to operate 
pipe oriran ; 8 ot her otieiiintrs. 



2 water closets: 1 bath tub: 1 lavatory; 
pipe orpan; 8 other openings. 



2 water closet-s; 2 bath tub:i; 1 lavatory; I urinal 
openlnflTs. 



motor to oi^erate 
8 other 



Name. 
District school No. 12. . 

Conirrefirational church 
and parsonage. 

Methodl5t church and 
parson acre. 

Catholic church and 
parsonage. 

Masoniclodge :....' 2 lavatorle-s; 1 other openin^r- 

Public library 1 water closet; 3 lavatories; 1 other opening. 

La Fayette County, 4 opening: fountain and Hshtank and opcninsrs for sprinkler. 
AiTricultural Society 

Episcopal church ; 1 water closet; 1 bath tub; 1 lavatory; 1 other opening. 

Baptist parsonage , 1 water closet; 1 bath tub: 2 other openinars. 

City of Darllnffton | 2 public trouarhs fdr teams: 2 drinking fountains, one con- 

j stant flow. Fire protection. 

CoMsuMBRs From Whom No Collections Wbre Made. 

Rctnarkfs. 
No rate established. 
1 water closet; 2 other other openings. 
Uses water from other hydrant. 
1 openint?. 
1 openincr. 
1 openlnir. 
1 openlni?. 



CUlKS. 

Opera house... 



Residence 

Cif^ar manufacturer.. 

Millinery store 

Residence 

Besidence 

Store 



The petitioners in this matter expressed the belief that the 
only satisfactory adjustment of the conditions in Darlington 
could be obtained by the installation of meters to measure the 
supply to consumers and the establishment of a meter rate which 
would be equitable and just. The petitioners did not demand a 
universal meter installation, but did demand that all large users 
of water should be metered, specifically mentioning those con- 
sumers who have sewerage, drainage or cess-pool connections. 
It was stated by the chairman of the water works committee of 
the city of Darlington that : "In most cases where parties have 
water closets, bath and lavatories, they have either sewerage con- 



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40 EAILBOAD COMMISSION OF WISCONSIN. 

nections or cess pools, and have kitchen sinks with faucets over 
sinks, where water is undoubtedly wasted to a great extent, both 
in cold weather to keep from freezing and in hot weather to 
have cool water for drinking purposes." 

The Commission has previously discussed the matter of meter 
installations for water utilities, and the following quotation is 
in point : 

"Investigations of the effect of the use of meters on the per 
capita consumption of water in a large number of cities have 
demonstrated that by a proper placing of meters a great benefit 
can be accomplished to both the utilities and the consumers. In 
order to secure fairly satisfactory conditions, it is not necessary 
that all, or even approximately all, of the consumers should be 
on a meter basis. A general installation of meters would largely 
increase the plant investment and, in a number ot in^iaaccs, ihe 
consumption of water in the premises w-ould hardly warrant the 
expenditures made necessary by such installation. In many in- 
stances the universal use of meters has resulted in only doubtful 
benefits. From an extensive investigation of the effect of meters 
upon the consumption in a large number of cities, it appears that 
a very material reduction in the per capita consumption or use 
may be brought about by metering no more than 1^0 or 25 per 
cent of the total consumption. A judicious placing of meters 
where the greatest waste or abuse of the flat rate privilege has 
been shown, shows that economies to be brought about after 50 
per cent of such consumption is metered are very doubtful, con- 
sidering the large increase in investment made necessary by 
metering the remaining sale." City of Ripon v, Ripon Light & 
Water Co, 5. W. R. C. R. 1, 86. 

It will be appreciated by any one who has studied the matter 
of water supply that there are certain consumers or classes of 
consumers for whom a meter would be a questionable invest- 
ment on the part of the utility. Those consumers who have no 
sewer connections or other means of house sewerage obviously 
cannot waste much water, except for lawn and garden sprinkling 
purposes. Again, tliose consumers whose residences have no 
cellars or basements will require frost boxes or vaults to protect 
the meter, which increases the investment to a point where any 
reduction or saving due to the use of the meter may be more 
than oiTset by the fixed charges on the investment necessary to 
accomplish a saving in use of water. 

It is difficult from the facts at hand to specifically name those 
consumers in Darlington whose supply should be metered. Ex- 
cept in a general way, it would therefore seem best that the 



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KlftWiN Et Ati. V. CtTY Oil' DARLINGTON. 41 

details of determining what prertiises shall be provided vVitli 
metel-s should be left liargely 40 the judgment of the city or its 
repl-esentatives. The facts at halud^ however, seem to warrEmt 
the std-tement that "all consumets having sewer or cess-pool con- 
neetions should have their water metered. At any rate, this ap- 
pears to us to be a reasonable basis upon which to proceed in the 
work of iftstalling meters for the fespottdent*s water works. By 
following this rule, it would seem that something over 50 per 
cent of the Consumers would be placed on a meter basis, and that 
by far the greater proportion of the water used by private con- 
sumers would be measured. It further seems to Us that the 
meters thus installed should be furnished, installed and main- 
tained by the respondent. 

Rates. 

It is obvious that no rateis for water in Darlington can be 
made at this time which can be advanced as a permanent sched- 
ule. Whatever rates are offered) must h^ more or less of a tem- 
porary nature and subject to rt?vision at a later date. No m:icrs 
have been used in Darlington. No consumption statistics are 
available* No report has ever been made by the utility to this 
Commission. No separate records of the expenses of the utility 
have been kept. The figures used as a basis for rate making 
must, therefore, in a large measure be estimates. The rates 
suggested herein, however, have been worked out with the idea 
in mind that it was necessary that they should be so constructed 
that they would fairly and equitably meet the present demand 
for new rates; that they would be easily understood; and that 
they would readily lend themselves to such revisions as may 
Income necessary In the near future. 

It is recognized that there are certain expenses incurred in 
the operation of a water utility which are directly proportional 
lo the mimber of consumers. Such costs as depreciation and in- 
terest on meters, cost of readin^^* meters, dcliveriiic: ImIIs. repairs 
on meters and services are clearly included in this class of ex- 
penses. These expenses go on whether the consumer uses much 
or little water, or, in fact, whether he uses water or does not 
use the service. It is obvious that srnic form of charuc nuist 
be made that will guarantee the payment of these costs. The 
tentative valuation contains no valuation of the services or con- 
nections between the mains and the consumers' premises, and it 
appears that these services have been paid for by the consumers. 

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42 RAILROAD COMMISSION OF WISCONSIN. 

It is evident that we must rely on the statistics of consumption 
by metered consumers in other cities, to a large extent, in aim- 
ing at a basis for computing meter rates for consumers in Dar- 
lington. It is further evident, from the scarcity of reliable and 
complete data along this line and from the more or less diflFering 
conditions in different cities and localities, that such information 
as is available must be used with great caution in this case. It 
has been shown that the residence consumers in Darlington con- 
stitute by far the majority of the water takers. It was found, 
in connection with the investigation of the consumer data of the 
Madison water works, that the average consumption by 3,009 
residence consumers in Madison was 4,099 cubic feet per year. 
Assuming four persons to a family, this was equivalent to a 
consumption per capita of approximately 21 gallons per day. In 
Jefferson, where the meter installation is general, the average 
consumption per residence consumer was about 2,765 cubic feet 
per year. On the basis of four persons per family, the consump- 
tion per capita amounted to 14.2 gallons per day. A large num- 
ber of residences in Jefferson have no sewer connections, and the 
above per capita consumption for that city is therefore probably 
lower than the average consumption that is generally found for 
this class of consumers. Mr. George B. Bassett. in the 1906 
proceedings of the American Water Works Association, esti- 
mated the amount of water consumed daily on a metered domes- 
tic service, without garden hose, as 10 gallons per capita for 
small houses with a single faucet ; 20 gallons per capita for 
medium sized houses with hot and cold water, water closet and 
sewer connections: 30 gallons per capita for fair sized houses 
with the same fixtures as above, and 20 to 100 gallons per capita 
for large houses with many fixtures. The Water and Gas Re- 
view in an editorial in a late issue states : 

"Tables of statistics, prepared by competent engineers, show 
that the average daily consumption of water per capita for do- 
mestic purposes only, is about 18 gallons." 

In view of the facts thus presented and of all other available 
data that have been examined, it appears to us that the rates 
named in the order herein can be, at least temporarily, fairly put 
into effect for the services rendered by the Darlington municipal 
water works. 'I ! ' 

It should he understood in this connection that any necessary 



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KIBWIN ET AL. V. CITY OP DARUNOTON. 43 

and proper changes in this order will be granted upon applica- 
tion to that effect. It should further be understood that the 
rates named in this order are subject to such changes by this 
Commission as may be deemed proper later on. 

It is Therefore Ordered, That the respondent herein, the 
Darlington municipal water works, shall, at its own expense, pro- 
vide and maintain meters for the measuring of the water used 
by each of its customers who is connected with sewer or cess 
pool. 

It is Further Ordered, That the said water works discon- 
tinue its present rates for the services involved and that in place 
of these rates it substitute the following rates : 

The city of Darlington shall pay a hydrant rental of $35 per 
hydrant per year. 

For each consumer or taker provided with meter, or who is 
placed on a meter basis, the rate shall be made up of service and 
of meter charges, as follows : 

Service charges: 
% inch meters, one consumer : $0.75 semi-annually. 
y^ " " " " 1.00 " 

1 " " " " 1.25 " " 

2 " " " " 1.50 " " 

For other sizes of meters than those mentioned, there shall 
be a proportional variation in the service charge. 

For each additional consumer on the same meter, there shall 
be an additional service charge of 50 cents semi->annually. 

M^ter charges: 

In addition to the above service charges, there shall be a 
meter charge of 12 cts. per each 100 cubic feet of water up to 
and including 50,000 cubic feet. For quantities in excess of 
50,000 cubic feet there shall be a meter charge of 10 cents per 
each 100 cubic feet of water. 

For each consumer not provided with meter, there shall be 
a semi-annual charge of $2 for each bam, and $3 for each one 
of the remaining takers. 

Each dwelling, flat, store, tenant, etc., shall be regarded as 
one consumer in determining the charges. 

All free services for public and other buildings and for other 
customers shall be discontinued. 

This order shall take effect January 1, 191J, 



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44 RAILROAD COMMISSION OF WISOOHStN. 



IN RE APPLICATION OP MT. HORBB BLE2CTRIC I.IOHT COMPANY 
FOR AUTHORITY TO INCREASE RATES. 



Suhmitted May 11, 1910. Decided Dec. /, IDIO. 



Petition praying for permission to advance the rates for street light- 
ing in Mt. Horeb from $1 to $2 per 32 c. p. lamp per month. 
The petitioner had made no attempt to keep its books in com- 
pliance with the uniform classification of accounts prescribed 
by the Commission, and it was therefore necessaiy to have 
recoursef to estimates and to comparisons with other plants in 
analyzing the revenues and expenses of the petitioner. 

On investigation it vias found that the assertion of petitioner, that 
the rates for municipal lighting iii Mt» Horeb ftre less than 
those charged for similar services in similarly situated com- 
munities, is not substantiated by comparison with such rates 
on file with the Cominission; that while it is apparent that 
petitioner is not obtaining a sufhci«nt amount of revenue, the 
village is paying its just pro-portion for the service rendered; 
that, the investigation relating entirely to municipal service, a 
readjustment of the commercial rates, however apparently 
justifiable, cannot be considered without opportunity for fur- 
ther hearing. The petition is dismissed. 

This case arose out of an application to Increase rates for mu- 
nicipal incandescent lighting service. 

On April 21, 1910, the Mt. Horeb Electric Light Company, a 
corporation organized under the laws of Wisconsin, made peti- 
tion stating, in part, that it is at present furnishing thirty-seven 
incandescent lamps of 32 candle power capacity for street light- 
ing in the village of Mt. Horeb, at the rate on $1 per lamp per 
month, which rate was in effect prior to April 1, 1907; that such 
rate is wholly inadequate and does not compensate for service 
rendered, and is proportionately less than that charged by the 
company for similar service supplied to other consumers. Appli- 
cation was made under the provisions of sec. 1797nl-— 105, ch. 
499, Laws of 1907, for permission to advance the rates from $1 
to $2 per lamp per month. 

Pursuant to notice, a hearing was held on May 17, 1910. O. A 
Stolen, Andrew P, Lee and Albert Gunthcr appeared for the pe- 
titioner, There was no opposition from the village of Mt. Horeb. 



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In re appl. mt. horeb bl. lt. co. 46 

Testimony was introduced showing that about $92 remained 
after paying taxes and operating expenses to meet depreciation 
and interest on investment, and that the actual cost of current, 
as estimated from the cost of coal, labor, repairs, oil, etc., aggre- 
gated 5.5 cts. per kw. hr., and the total cost for the lamps for the 
live and a half hour service furnished, $34.65 per month. No 
separate operating expenses were submitted to substantiate these 
conclusions beyond a statement that the entire labor cost 
amounted to $70 per month, and the coal consumed to 1,800 lbs. 
per day. 

No opposition was made at the time of the hearing to the 
granting of the petition or to che evidence introduced in sugj^ort 
of petitioner's contentions. On May 27, however, a letter was 
received from W. M. Lewis, president of the board of trustees 
of the village of Mt. Horeb, making a protest against the pro- 
posed increase, and requesting an c^portunity to file an objection 
in writing. A further letter followed, stating, amojig other 
things, that the village had been paying $1 per lanip per month 
from ten to twelve years, with a connected load of only sixteen 
to twenty lamps ; that it had only recently attempted to light each 
half block, with an increased installation of thirty-hve lamps ; that 
if rates were advanced the installation would again be decreased, 
or other methods of lighting resorted to; that service is not fur- 
nished for a period of five and a half hours per night; that the 
agreement between the village and the company does not require 
lighting during moonlight; that other than the agreed service is 
not being furnished, and that the s^ctual hours of burning will 
average less than three hours per night. 

The answer of the company constitutes a general denial of the 
contentions cited above, and objects to the consideration of testi- 
mony without opportunity for cross-examination. 

Two questions of fact are .raised in this case. The first of 
these relate to the Company's financial sitanding and involves 
the question as to whether petitioner is earning a reasonable re- 
turn upon the investment. More directly applicable to the issue 
in the case is the question whether losses incurred have been oc- 
casioned by the municipal service for which an increase in rev- 
enue is demanded. 

Data relating to the cost of plant and the ej^pense of conduct- 
ing the business have been obtained from submitted annual re- 



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46 BAILBOAD COMMISSION OF WISOONSIN. 

ports, supplemented by a close inspection of company's books and 
property. 

It appears fr<Mn the testimony that petitioner company is cap- 
italized at $10,000, and has an actual investment of $8,000. The 
reasonableness of this figure is substantiated by a rough inven- 
tory of the plant made by a member of the Commission's engi 
neering staff. To reproduce the plant new would involve an ex- 
penditure of approximately $11,700. From the annual report 
filed by the company for the year ending June 30, 1910, gross 
earnings amount to $2,395.01. Of this amount $498.01, or 20.8 
per cent, was reported as earnings from public service. The re- 
mainder, or $1,897.00, accrued frcm commercial service. Earn- 
ings from sales of material and supplies yielded in addition $35. 
Expenses for the same period were reported as follows : 

Operating labor |780 00 

Fuel for power 1, 125 00 

Miscellaneous power plant supplies and expenses 25 00 

General office salaries 20 00 

General office supplies and expenses 2 25 

Rent 6 00 

Taxes 90 00 

12,047 25 

Net earnings aggregated $382.76, or 4.78 per cent upon an in- 
vestment of $8,000. 

No attempt has evidently been made to keep the company's 
books in compliance with the uniform classification of accounts 
as prescribed by the Commission, and it is probable that some 
of the items reported are estimates rather than summary state- 
ments of actual accounts. This conclusion is borne put by the 
inspection of company's books by a representative of the Com- 
mission. 

A portion of the memorandum submitted follows: 

"From records, uncertain because of incompleteness of entry i 

and illegibility, the amount of business for the year ending Aug. i 

1, 1910, has been taken as follows: | 

August 1, 1909, to August 1, 1910. 

Total receipts 12,353 01 ' 

Total expenditures 2, 643 57 

Balance (deficit) S^90 56 

"In the ledger few entries are made for Ftb., 1910, so it is 
uncertain whether the total revenues are as above reported. 
There is no separation whatever in recording revenues from 



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In re appl. mt. horeb el. lt. co. 47 

operation, merchandise sales and construction work; nor is 
there any clear separation of expenditures as between operation, 
construction and non-operating activities. 
^'Revenues may be apportioned as follows : 

Commercial lighting 11,995 46 

Municipal lighting 357 55 

12,353 01 

"It is apparent, however, that municipal earnings are not cred- 
ited with a sufficient amount, as the total contract price for a 
year is $420. Owing to certain indebtednesses of the owner of 
this utility to large consumers of electric current, no revenues 
are reported from these consumers, but instead the personal ac- 
count of the owner is credited to the amount of such revenue. 
There are at least two such instances. 

"Expenditures are roughly apportionable to 

Labor 1790 60 

Fuel 891 79 

Miscellaneous or general 132 64 

Materials and supplies 828 54 

12,643 57 

"No apportionment of labor is kept as between power plant, 
distribution line, and collections, installation work or construc- 
tion. Much of the materials furnished, $828.54, from J. Andrae 
& Sons Company, R. Williamson & Co., etc., is for purposes of 
re-sale at a profit; but no records have been kept of just how 
much of this amount was so incurred." 

From these two separate sources of information it appears 
probable that company's plant is not a conspicuous financial suc- 
cess. Just how great an increase in earnings will be necessary 
to offset incurred deficits, will depend upon the character of ex- 
penses, whether for operation, construction, or merchandise to be 
disposed of at a profit, and the possible economies in operation. 
These questions can be equitably disposed of when the company's 
accounts are kept as required by the Public Utilities Law in the 
manner prescribed by the Commission. 

The second question, as to whether the municipal service is con- 
tributing a proportionate or fair share to the earnings of the com- 
pany, must be made largely a matter of estimate. Earnings from 
the municipal service, according to the report filed for June 30, 
1910, amounted to $498.01, out of a total of $2,395.01, or 20.8 
per cent. The installation or connected load of the company con- 
sists of thirty-five 32-candle power lamps for street lighting, and 



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48 RAlLBOAp COMMIiaSlON OF WISCONSIN. 

thirteen hundred IB-candle power lamps for commercial light- 
ing. Municipal service amounts to 5.1 per cent of the total con- 
nected load. 

The total amount of current sold is not so easily determined. 
From such available station data as it was possible to gather, 
the visiting engineer estimates the total output for the year end- 
ing June 30, 1910, as 37,268 kw. hrs. A somewhat higher figure 
is obtained from computations based upon the efficiency of the 
plant as a whole. Company'^ equipment consists of one 125 
h. p. Milwaukee return tubular boiler, one 105 h. p. Alfree engine, 
and a 50 kw. d. c. 220 volt Northern generator. The hours of 
operation are from dusk to 11 p. m., willi the exception of Sat- 
urday evening, when the plant is operated until 11:30 p, m. 
On a yearly basis, hours of lighting will aggregate about 825. 
The peak, or instantaneous maximum demand has been reported 
at ISO amperes, or 28.6 kws. Coal consumption aggregates 
600,000 lbs. for a year. When allowance is made- for the low 
load factor at which portions of the plant are being operated, the 
inappropriate capacity of operating units, it apears that an econ- 
omy of about 13.6 lbs. of coal per kw. hr. output can be ex- 
pected under normal operating conditions. This figure reveals 
a somewhat more extravagant coal consumption per unit of out- 
put than is usual in small plants in this state. On this basis of 
estimate, the total output will amount to 44,118 kw. hrs. 

Another basis of estimate, often employed, is to assume a 
certain number of hours use of the maximum instantaneous de- 
mand or connected load. From data compiled from a large 
number of plants in this state, the average hours use of maxi- 
mum demand is placed at about 1,207, indicating, in this particular 
case, an output of 34,520 kw. hrs. Average hours use of con- 
nected load compiled from the same source, aggregate about 500 
per year, and on this basis the total output of the Mt. Horeb plant • 
would amount to 37,675 kw. hrs. In support of these last two 
' estimates it may be said that examination of operating conditions 
at Mt. Horeb do not serve to indicate that current consumed is 
below the average. There are 108 consumers, 29 of which are on 
a flat rate basis. The population is placed at about 1,100 in- 
habitants, or about ten inhabitants ])er ci-n^umer. The instal- 
lation per commercial consumer is about 12.4 lamps, and the ra- 
tio of demand to connected load about 38 per cent. These re- 
lationships are remarkably uniform in small plants and give 



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In re AP?L. MT. I^0RB3 Kli, LT. CO. 49 

uckliliunal weight to the output figures represeiUccJ. Reviewing 
the basis of these four estimates carefully, it seem^ that no in* 
justice is done petitioner company by assuming a total output of 
34,000 kw. hrs. 

The amount of current consumed by the city service would de- 
pend upon the yearly hours of illumination. Witness for the 
petitioner testified that lamps were on about five and one-half 
hours per night. Assuming that the time of street lighting coin- 
cides with the time the plant is operated, the yearly schedule 
would aggregate 1,825 hours, and the current consumption 7,026 
kw. hrs. The city claims that lamps are contracted for on the 
moonlight basis and so lighted. On a theoretical moonlight basis 
the yearly schedule would aggregate 840 hours, and the current 
consumption 3,234 kw. hrs. Actual experience, however, shows 
that an allowance of from 11 to 30 per cent must be made to 
theoretical moonlight sdiedules for cloudiness. Assuming a lib- 
eral 1,200 hour moonlight schedule, current consumed will aggre- 
gate 4,620 kw. hrs. 

Comparing the minimum station output, 34,000 kw. hrs., with 
the maximum current consumption on a full time schedule for 
city lighting, 7,026 kw. hrs., the relative amount of current re- 
quired for such service will aggregate only 20.7 per cent of the 
entire output. With earnings for such service aggregating 20.8 
per cent of the total, it does not seem that the municipal service 
is not -contributing its proportionate share of the company's rev- 
enues. 

This conclusion is substantiated when a calculation is made as 
to the cost of furnishing service. Total operating expenses, as 
reported, aggregate $2,047.25, and to this an addition is properly 
made for depreciation and return upon investment. Taking 13 
per cent of $8,000, this addition will amount to $1,040, and total 
cost of production of $3,087.25, Calculations of the cost of i)rcv- 
ducing electric service, made where total operating expenses are 
known, indicate that about 40 per cent of these expenses, or 
$1,234.90, would vary proportionately to the demand, and 60 per 
cent, or $1,852.35, would vary proportionately to the output. De- 
tailed descriptions of such apportionments have been accorded 
considerable space in former decisions. In re Menominee & 
Marinette Light & Traction Co, 3 W. R. C. R. 778; In re Appi 
Stoughton Mun, El Lt. System, 3 W. R. C. R. 484, 490. 

On this basis output costs will amount to 5.368 cts. per kw. 
4— R. D. 



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50 



RAILROAD COMMISSION OP ^WISCONSIN. 



hr. ; demand costs to $16.38 per kw. per year. The cost of city 
lighting per bmp upon a full time basis will then amount to as 
follows : 

Demand cost— 1 10 W, ilemaiu) at $l().:W per k w, per vear $1 .80 

Output cost- 110 W, 1,200 hrs., or 201 kws \ 10.79 

Total $1 2 . 59 

It has been suggested that the municipal lighting charges sub- 
stantiated above arc out of proportion with the 12 ct. per kw. 
hr. charge for ccnimcrcial service. An illustration of the cost 
of service for various hours of use will illustrate how this is 
possible. If, as is usual, only about one-half of the installation 
is considered in determining consumers* demands the cost of 
service, where installation is only used one hour, will amount to 
14.35 cts. per kw. hr. Where the installation is used five hours, 
as is the case with city lamps, the cost will be correspondingly 
lessened. 



ESTIMATED COST OF SERVICE, 

Commercial Lighting. 

C'wt in Centif per Kw. Hr. for Variimts Utnirs U»e of an Active Conncctal IahuI vcr Day. 



Hours use of active connected load. 


Tiomand 
cost, 

8.98 
4.i9 
2.99 
2.25 
1.T9 


Output 
cost. 


Total 
cost. 


1 


5.37 
5.37 
5.37 
5.37 
5.37 


u.a5 


2 


9.8ti 


3 


8.36 


4 


7.82 


5 


7.16 







Petition.ers' supplemental brief states that rates for village 
lighting at Mt. Horeb are less than those charged for similar serv- 
ice in similarly situated communities. Comparisons of such rates 
on file with the Commission, reduced to the lamp hour basis, do 
not bear out this assertion. In tables I and II, following, com- 
parison is made between the rates at Mt. Horeb and other com- 
munities of similar size. It will be noted that the charge, that 
petidoner is seeking to increase, is already somewhat above th€ 
average, whether considered on an ''every night*' or a "moon- 
light" basis. 



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In re appl. mt. horeb el. lt. co. 



51 



TABLE I. 

COMPARISON OF RATES FOR MUNICIPAL LICillTING SERVICE. 
32 e. p. TAimp«^Kvcry Night Ba»U. 



Cotnmutiitx. 



Bloomer . . 
Helavan . . 
Durand.... 
KIkhorn... 
Frederick. 
Glen wood. 

LaFarge.. 

Manawa... 
Necedah.. 



Pardee ville. 
Waterford.. 

Wyoctsna 

Mt. Horeb.. 




Schedule. 



Dawn 

Dawn 

Dawn 

Dawn 

Midnight 

Midnlflrht and 5:30 a. m. to 

dawn 
II i>. m. and earb* mornlnif 

in winter. 
Midnight and 5 a. m to dawn 
Midnight and dawn 



Dawn 

Dawn 

11 :30 p. m. and 4;30 to dawn 
Dusk to 11 p. m. 11:30 p.m. 
Saturday. 



Esti- 
mated 
hours 
burning. 



4,000 
4.000 
4.000 
4.000 
2.200 
2.300 

2,280 

2.650 
,200 and 
4.000 
4.000 
4.000 
2,600 
1.825 



Average lamp hour rate— every night basis . 



Rate per 
year 



tl2 00 
24 00 
12 00 
.%00 
12 50 
12 00 

12 00 

n 20 
12 00 

15 60 
18 00 
12 00 
12 00 



Rate per 

lamp 
hour.ctji. 



.3 

.6 

.3 

.9 

.567 

.522 

.526 

.498 

.545 

.3 

..375 

.45 

.461 



.488 



TABLE IL 

COMPARISON OF RATES FOR MUNICIPAL LIGHTING SERVICE. 

32. c. V. Lamps— *'Mo*mJlghV* Ba»i9. 



Community. 


Popula- 
tion 


Schedule. 


♦Esti- 
mated 
hrs. 
burning. 


Rate per 
year. 


Rate i)er 

laniphr.. 

cts. 


Alma. . 


1,172 
2,006 
1,426 

6K 
1,674 

673 

960 
1,483 
2,321 
2,416 
1,006 

687 
1,602 

863 
1,450 

578 
1.300 
2,530 
1.004 
1,118 

718 
1,08(i 
1,003 


Midnight 


1,020 

2,125 

1.020 

1.020 

1.220 

870 

2.125 

2,125 

2,125 

2.125 

2,126 

2,125 

2,125 

930 

930 

825 

1,020 

2,125 

825 

1,020 

82:» 

1,020 

840 


12.00 
12.96 
12,00 
27.00 

6.00 
24.00 
15.00 
12.00 
18.00 
24.00 
21.60 

9.00 
15.00 
12.00 
16.20 
16.00 
14.40 
10.00 

P. 00 
14.50 
12.00 
21.00 

12.00 


J w 


A Iguma 


Dawn 


.61 


Auguftta 


Midnight 


1.18 


Bangor 




2.64 




1 a. m 


491 


Cashton 


ll:15p. m 


2.76 


Cheteck 


Dawn 


.706 


Cumberland 


.565 


Delavan 


»i 


.847 


Edgerton 


.» 


1.13 


Fountain City.... 
Greenwood 


" • 


1 017 


" ;:::::::::::::::: :::::: 


.423 


Lake Mills 




.706 


M azomanle 


ll:3()p. m 


1.2S»1 


Mondovl 


11 :30 p. m 


1 74.3 


North Freedom. . . 


11 p.m 


1.938 


Omro. 


Midnight 


1 1.41 


Pesthigo 


1 Dawn 


.471 


Bandolf 


lip. m 


1 1 091 


Seymour 

Soldien Grove 


Midnight 


1.42 


11 p. m 


1.455 


Sun Prairie 


Midnight 


2 028 


Mt. Horeb 


Du.sk toll p. m. 11:30 

.Saturday 






1.428 


• 







Average lamp hour rate. - moonlight basis. 



1.23 



*ln estimating the number of hours burning, allowance has not been made for 
cloudines.s. The error, however, is practically a constant, and will nut aflTect the com- 
parative value of the table. 



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53 I(A114^0AD COMMISSION OF WISOONSIN. 

The petition in this case refers only* to municipal service, and 
the evidence presented and objections offered concerned them- 
selves almost entirely with that branch of the business. A read- 
justment of commercial rates, however apparently justifiable, 
cannot be considered without opportunity for further hearing. 

Little reliable data have been presented in the case. The 
facts, meager ^s they are, seem to indicate that a readjustment of 
rates may well be postponed until such time as company's ac- 
counts and station records are in sliape to substantiate other con- 
clusions. 

It is TiiEUEPORE Ordered, That the petition in this case be 
and it is hereby dismissed. 



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In re Apph. LANrAStfeft el. lt. co. 53 



IN RE APPI^ICATION OF THE LANCASTER ELECTRIC LIGHT 
COMPANV FOR AUTHORITY TO INCRFJASE RATES. 



fiuhmHted Oct. g.7, 19i0, Decided Deo. S, IBIO, 



Petition praying for authority to put in effect a tninimum rat^ of |1 
per montli. An analysis of the operating expenses shows 
that the consumer costs tt) the company amount to 46 cts. 
per meter per month. It appears that Applicant charges a 
meter rental of 25 cts. per month of consumers on a meter 
basis in cases where the meter is owned by the company. 

Heid: That it is contrary to the proriflionii of th« public Utilities Law 
to charge consumers owning their meters different rates than 
those whose meters are owned by the company, but applicant 
may pay to consumers who own their meters a reasonable 
rental therefor; that the primary purpose of a minimum bill 
is not to yield any considerable Increase In revenue, but to 
enable the utility to receive from each conilumer an amount 
at least equal to the cost to the utility of being prepared to 
furnish service; that the propceed minimuta of |1 per month 
is unnecessarily high, and that a monthly minimum of ?5 
cts. would be reasonable and just. Applicant is authorized 
to put such minimum rate of t5 cts. In effect. 

The applicant, the Lancaster Electric Light Company^ states in 
its application that it hAs at present in effect a meter rale of 12j^4 
cts. per kw. hf., and that, since numerous of its consumers use 
only from one-half to 3 kw. hrs. per month, it desires authority 
to put in effect a minimum rate of $1 per month. 

The matter was heard at the office of the Commission Oct. 25, 
1910. George P. Angus, superintendent, appeared for the ap- 
plicant; there was no appearattcc in opposition to the applica- 
tion. 

The representative of the applicant stated that the book vaitic 
of the plant is about $33,000; that the plant has been earning 
annitally about $1,500 to $2,000 above operating expenses, with- 
out any allowances for depreciation ; that many of the consumers 
use so little current that their bills are only about 10 to 40 cts. 
per month, which does not pay for the cost of connection; and 
that although not quite all the 190 consumers have meters, the 
intention is to meter all services. The meters are owned in sonie 



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54 RAILROAD COMMISSION OF WISCONSIN. 

cases by the consumer, the company keeping them in repair free 
of charge, and in other cases by the company, which rents them 
to the consumer at a charge of 25 cts. per month to cover repairs 
and depreciation. The superintenclent of the applicant company 
testified that he knew of no sentiment opposing the establishment 
of the minimum charge, but that, on the contrary, one consumer 
had expressed to him his willigness to pay $1 instead of the 50 
cts. he had been paying. The rate applied for would, it was 
testified, increase the revenue of the company about $125 to $140 
' per year. 

The actual facts with regard to the number of consumers who 
will be affected by the proposed monthly bill of $1 have not 
been presented to the Commission, but it appears that a consid- 
erable number of consumers are at present paying only from 10 
cts. to 40 cts. per month, which amounts', the applicant states, 
are insufficient to meet the expense of furnishing current to such 
consumers. The applicant believes that a minimum bill of $1 
per month would be just and equitable, and fairly cover the cost 
of supplying current to these small consumers. The question of 
the revenue which will be derived from the use of a minimum 
bill, is not the determining factor in the decision in this case. 
The purpose of a minimum bill is not, primarily, to increase the 
revenue of a utility making use of the same, although if this 
minimum is not placed so high as to discourage consumption, 
some increase in revenue is almost certain to result. In this 
case the applicant, as stated above, maintains that the use of such 
a minimum bill as that proposed would not discourage the use of 
current by small consumers. 

Although the question of revenue to be derived is not the item 
which determines whether or not a minimum bill should be al- 
lowed, it IS important to know what the condition of the applicant 
is with regard to revenues and expenses. 

At the hearing the applicant stated that its revenues exceeded 
its expenses by about $2,000 per year, without any allowance be- 
ing made for depreciation. A summary of the revenues and 
expenses reported for the year ending June 30, 1910, as^rshown 
in tables I and II, show that the expenses, exclusive of taxes, 
depreciation and interest, were $7,384.85, and that the revenues 
were $9,618.58, thus leaving $2,233.75 to be applied (toward the 
payment of taxes, depreciation and interest. 



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In re appl. Lancaster el. lt. co. 55 



TAULK 1. 

EXPENSES-LANCASTER ELECTRIC LIGHT COMPANV. 

Steam Power Generation: 

Oi^eratlDff labor lUIS 00 

Steam srenerated 4. 041 55 

Miscellaneous power plant supplies and expenses 204 70 85, 401 25 

Transmission and Transformation: 

Maintenance of transmission system 174 75 

Maintenance, transformer station buildings 90 75 2tS5 50 

Distribution: 

Maintenance of transformers 40 35 

Maintenance of meters 09 00 100 25 

Consumption Municipal Contract Lifirhttncr: 

Trimmlnir and Inspectlnif municipal contract lamps 75 45 

Municipal contract lamp supplies 90 55 

Miscellaneous municipal contract ll]?litinff supplies and ex- 
penses. 30 25 190 25 

Commercial: 

Collection and promotion of business 460 00 400 00 

General: 

Miscellaneous creneral expenses 26175 

Maintenance general office e<iulpment 87 10 348 85 

Undistributed: 

Insurance 180 00 

Stationery and prlntinir 47 75 

Maintenance stores drpt., buiidinirs, fixtures, grounds 315 96 543 73 

Total of above "5^7384 83 



TABLE II. 

REVENUES-LANCASTER ELECTRIC LIGHT COMPANY. 

OperatinflT Revenues: 

Commercial llirhting earnln«rs 16. 841 24 

Municipal contract Uirhting earnings 2.700 00 19,541 24 

Non-operating Revenues: 

Profit on merchandise sale.s- net 15 39 

Profit on wiring and installation work 01 95 77 34 

Total of above "S^18 58 

Surplus for year ending .Tune 30, 1910, exclusive of taxes, depre- 
dation, and Interest $2.233 75 

Taxes 1202 35 



Deducting the $202.35 for taxes, we find that the amount avail- 
able for depreciation and interest is $2,031.40, or about 6.2 per 
cent on a plant value of $33,000. From this it appears that the 
revenue of the applicant is not excessive, and that any increase 
which will result from the use of a minimum bill will not increase 
the revenue beyond a reasonable point. 

Records of the applicant show that during the year ending 
June 30, 1910, it had 186 commercial consumers, of whom 145 
were on a meter basis, with a total of 147 meters installed. 



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56 



RAlr.ROAt) COMMISSION OP WISCONSIN. 



TAHLE HI. 

NUMBEK OF LAMPS AND THE CONiNECTEl) LOAD ON E U AND ON 

FLAT HATE BASW, 





Number of 

lamps me- 

lored. 


Numlierof 

iampsun- 

melei-ed. 


Oarljon lattips (50 w. units). i . » ....... 


4. ore 

1,44S> 


187 


Tuntrsteii '* (40 w. ** ) 


300 






Total 


5,044 


4D3 








Ooiiueftpd 

h)ad me- 

It'wd Walts. 


t'ohllpct^i! 
load untUe- 

itretl watts. 


Carlton lam us 


203.950 
5«.00«> 


i^.:)5o 


Tiinirsten lampn 


18,240 






Total 


202,550 


21.590 



In its application for authority to put in a minimum bill the 
Lancaster Electric Light Compaily states that its ititention is to 
put all consumers on a meter basis. 

In that case it appears that the number of consumers and the 
number of meters will be practically equal, as there will be very 
few cases where there will be mote than one meter per consumer. 

Table IV is a statement of what may be called consumer costs, 
that is, expenses that are incurred because of the fact tiiat the 
consumer is in a position to use current if he chooses to do so. 

TAIUJO IV. 

CONS r ME H COSTS. 



Total. 



M aintenance of meters 

( lommeiT-lal o \ penses 

Taxes t>rt metet^ 

{)epi*ecIatlon at 7% on meters . 
nterest at T% Ou meters 

7 'axes on services. . . ^ , . . 
)ppreclftUoh of setvloi^s at 5^. 

1 utert^st on sorricos at 7% 

20% of g*»nerftl eMtenses. . ..;... 



TOUI. ..;;.....; 

Avoraije per meter per month. 



102^ 39 



l*cr meter. 



S09 00 


SO 47 


400 00 


2 48* 


n 74 


08 


1.34 20 


91 


134 9i» 


91 


1700 


J>9* 


m At 


or* 


H< 53 


10* 


U&77 


ftR* 



» 49 
10 40 



* Per consumer. 

In this table the average value of meters, put in place, is placed 
at $13, and the average value of services, exclusive of meters, at 
$L50. 



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• tn re appl. Lancaster el. Lf. co. 57 

Costs incident to the use of meters are computed per meter 
already installed, and other costs are computed on the basis of 
number of consumers, so that the final cost of $5.49 represents 
the cost per metered consumer. If all consumers are put on a 
meter basis, this amount of $5.49 per metered consumer will 
still he substantially correct, because the only items of expense 
which will be increased will be those which vary directly with 
the number of meters. 

Consequently that cost of service which arises because of the 
existence of meters and of service connections, without reference 
to the amount of current used, will be aK>roximately 46 cts. per 
month per metered consumer. 

As stated above, the primary purpose of the minimum bill is 
not to yield any considerable increase in revenue. Its purpose is 
rather to enable the utility furnishing service to receive from 
each consumer an amount at least equal to the cost to the utility 
of being prepared to furnish service, which amount we found 
in this case to be about 46 cts. per month. 

In addition to this amount it is the general rule that the mini- 
mum bill should be placed high enough to return to the company 
payment for current actually used. For example, in this case, if 
a consumer used 2 kw. hrs. per month, the value of current 
used at the rate charged by the applicant, 121/^ cts. per kw. hr., 
would be 25 cts. per month. If the minimum bill were placed at 
45 ots., the company would receive from this consumer no return 
for current actually used, but merely an amount sufficient to 
cover the cost incurred by the company, because of its being in a 
position to serve. 

The minimum bill should be high enough to cover this cost 
and also yield a return on curr/ent actually consumed. If the 
minimum bill were placed at 46 cts., it would be necessary to 
base the charge on two items: 1, the minimum bill; 2, a charge 
in addition to this for all current consumed. Under the schedule 
of rates in effect at present for current sold by the applicant, 
there is no provision for any such system of charges. The mini- 
mum bill, therefore, if it is to be institirted by the applicant, must 
be high enough to cover these fixed costs and also the average 
value of current used by the class of consumers who, in general, 
use the smallest amount of current. 

As stated above, no detailed statement of revenue per con- 
sumer is available, but it appears from the testimony in this case 



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58 RAILROAD COMMISSION OF WISCONSIN* 

that there is a rather large class of consumers whose monlhly biilb 
run under 40 cts. It seems that 25 cts. per month will represent 
about tlie average revenue per month from consumers of this 
class. This, added to the hxed costs of 46 cts. per metered con- 
sumer, would fix the minimum bill at 71 cts. per month. It is 
not believed that the 46 cts., as used here, represents exactly all 
the costs directly connected with the readiness of the applicant 
to furnish current, but the variation from this point will not be 
more than a few cents in either direction. 

On the whole, it seems that the proposed minimum of $1 per 
month is unnecessarily high, and that a minimum monthly bill 
of 75 cts. is reasonable and just. 

As matters stand at present, the applicant charges a rental of 
25 cts. per month to consumers on a meter basis, in cases where 
the meters are owned by the company. Consumers who own 
their own meters have them kept in repair by the applicant in 
the same way as if the meters were owned by the company. The 
meter rental is evidently intended lo cover the item of taxes, 
depreciation and interest on the meter, which we find from table 
IV amount to about 16 cts. per month per meter. As tlie meter 
rental is intended to cover items provided for in the minimum 
bill, it would amount to a double charge for the company to con- 
tinue to collect a meter rental. 

It may appear that a minimum bill of this character penalizes 
consumers who own their meters, in that they arc subject to the 
same minimum bill as those whose meters are furnished by the 
company, and bear, in addition, the expense of depreciation on 
the meter and of interest on their investment in the meter. In 
this connection let us call attention to the Public Utilities Law, 
which reads in part as follows : 

*'Sec. 1797m— 90. It shall be unlawful for any puljlic utility 
to demand, charge, collect or receive from any person, firm or 
corporation less compensation for any service rendered or to be 
rendered by said public util ty in consideration Qf the funiishing 
by said person, firm or corporation of any part of the facilities 
incident thereto; provided nothing herein shall be construed as 
prohibiting any public utility from renting any facilities incfdent 
to the production, transmission, delivery or furnishing of heat, 
light, water or power or the conveyance of telephone messages 
and paying a reasonable rental therefor." 

Under the terms of this section the applicant cannot charge 
diflFterent rates to consumers who own their own meters and lo 



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In re appl. Lancaster el. lt. co. 59 

consumers whose meters are furnished by the company, but tlie 
applicant may overcome any inequality which may appear to re- 
sult from the establishing of a minimum bill by paying consumers 
who own their own meters a reasonable rental therefor. 

From the applicant's report to the Commission for the year 
ending June 30, 1910, it appears that there were in use June 30, 
148 meters, of which 129 were owned by consumers and 19 by 
the company. The matter of adjustment between owners of 
meters and users who do not own their meters is not one to 
enter into this decision. 

From the facts in this case it appears to us that the applicant 
herein is jusdy entitled to a minimum rate of 75 cts. per con- 
sumer ^ per month, and 

The Said Appucant, the Lancaster Electric Light Company, 
Is Hereby Authorized to put such a minimum rate into effect. 



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60 RAILROAD COMMISSION OP WISCONSIN. 



IN RE APPLICATION OF THE GREENWOOD MUNICIPAL LIGHT 
PLANT FOR AUTHORITY TO INCREASE ITS RATES. TOLLS 
AND CHARGES. 



Decided Dec. 2, VJIO. 



Petition praying for authority to establish a minimum rate of 40 cts. 
per month for lighting. 

Held: That the main purpose of a minimum charge is to make it cer- 
tain that each consumer bears his Just share of expenses in- 
curred in supplying service; that in the instant case any ef- 
fect which the minimum charge of 40 cts. per month will have 
on the total revenues is so small that It cannot possibly make 
the surplus excessive; that said minimum charge of 40 cts. per 
month is reasonable and Just, and applicant is authorized to 
put the same in effect. 

The applicant in this case, the Greenwood municipal light 
plant, on Oct. 4, 11)10, petitioned the Coniniishiun to be allowed 
to increase its rates for lighting. The petition showed that the 
ai)plicant has in effect the following rates for commercial light- 
ing: 

10 cts. per kw. hr. on meter. 

40 cts. per 16 c. p. lamp, flat rate. 

No minimum rate. 

The rates which the applicant desires to put into effect arc 
as follows: 

10 cts. per kw. hr. on meter. 

40 cts. per 16 c. p. lamp, flat rate. 

40 cts. per month, minimum rate. 

The only change in rates which will result from applicant's 
request, if granted, is the introduction of the minimum rate of 
40 cts. per month. 

As repeatedly stated by this Commission, the minimum bill 
rests, for its justification, upon certain expenses which are in- 
curred by a utility because of its being in a ]K)siti()n t.) serve. In 
other words, the minimum bill for an electric lighting utility may 
be greater than the amount which would be derived from the 
consumer in question if he were charged merely for the current 



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In re appl. greenwood mun. lt. plant. 



61 



used at regular rates, and this is due to the fact that the utility 
incurs certain expenses because of its readiness to furnish cur- 
rent to the consumer, irrespective of whether or not he actually 
uses current. i 

These expenses are such as arise because of the consumer's 
premises being connected to the lines of the utility, and may be 
determined with a considerable degree of accuracy. 

It appears f rt)m the report of the applicant for the year ending 
June 30, 1910, that it had the following consumers: 

TABLE I. 





Metered. 

70 

2 

12 
3 
2 
1 


2 

1 

3 


IT n metered. 


Total. 


Residences 


2 

4 
1 

1 1 



' I 





1 

2 


78 


Saloonn 


4 

3 


J^tores*.. 


13 


Livery stables 


4 


Hotels 


2 


Theaters 


1 


f *hurt:hes 


3 


I/odee halls 


2 


Rowling Alley 


1 


S<«hools 


1 


Shothi 


5 






Tot al 


103 


U 


117 







As the proposed minimum bill of 40 cts. per month is the 
>ame as the flat rate per month for a single c. j). lamp, it api)ears 
that only those consumers who are on a meter basis will be af- 
fected by the introduction of such a charge. To determine the 
justice of such a charge it is necessary to state the expense per 
metered consumer which the utility incurs because of its being 
in a position to supply current. These expenses are approxi- 
mately as follows: 

TAHLK II. 

Por motor 
per year 

Maintenance of motors $0.50 

Interest on molers and .sorvicos, at 7% on $14 08 

Depreciation on meters an<l services, at 7*% on $U 98 

Total ^^.-l^J 

In the above table the item of maintenance of meters is esti- 
mated from the applicant's report of cost of maintenance of 
meters and transformers. The $14 per meter and service is an 



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62 BAILBOAD COMMISSION OP WISCONSIN. 

average figure which represents what is usually the value of 
these items. • It is not believed, however, that the above table 
represents all of the costs incident to the utility's being in a posi- 
tion to render service, and costs which are directly attributable to 
the individual consumer. 

Table III is a table which is made up of the items of depre- 
ciation and interest shown above, and other costs which repre- 
sent the average for all class B electric utilities reporting these 
items. Although this table may not represent the actual costs to 
the applicant, it is fairly representative of costs per metered con- 
sumer for smaller electric utilities. 

TABLE in. 

Per meter 
per year 

Maintenance of meters 9iO. 50 

Gu8tomer\s premises expenses U4 

Collection expenses 73 

Interest on meters and services at 7% on $14 98 

Depreciation on meters and services at 7% on $14 • .98 

Total $3.53 

That is, the consumer expenses are about 30 cts. per metered 
consumer per month, according to table III. Because of the fact 
that the applicant's report is very condensed and does not c(wn- 
pletely detail expenses, it is impracticable to ascertain exactly 
what is the expense per metered consumer, but the above figure 
of 30 ots. is probably below rather than above the true amount. 
If to this is added 20 per cent of the general expenses reported, 
which is about the proportion incurred directly by consumer, the 
cost per metered consumer per month is raised to 32 cts. 

This figure is still below the proposed 40 ct. minimum, but the 
minimum charge should yield a return equal to this consumer 
cost, and an additional amoimt to cover the value of the smallest 
amount of current used by any class of consumers. The appli- 
cant has not furnished the Commission with a detailed statement 
of its revenue from commercial consumers, but there are no rea- 
sons to believe that there is a considerable number of consumers 
whose consumption is so low as to entitle them to a charge as 
low as 10 cts. per month under present rates. As a matter of 
fact, in cases of this kind it is unusual for this lowest charge for 
any considerable class to be under 20 cts. or 25 cts. But even 
assuming that this figure is as low as 10 cts., we get an amount 



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In re appl. greenwood mun. lt. plant. 63 

slightly in excess of 40 cts. per month as the smallest expense 
to the applicant for furnishing current to any consumer on a 
meter basis. 

The. question of the effect of this minimimi charge on the rev- 
enues of the utility is not of first importance in determining the 
reasonableness of such a charge. The main purpose of the mini- 
mum charge is rather to make it certain that each consumer bears 
his just share of the expenses incurred in supplying service. 

In this case it appears from the report of the applicant for 
the year ending June 30, 1910, that the total operating revenues 
were $3,083.40, and total operating expenses were $1,738.94, leav- 
ing a surplus for the year of $1,344.49, which gives a return to 
cover depreciation and interest on a plant value of $17,800, of 
7.5 per cent. 

Any effect which a minimum charge of 40 cts. per month will 
have on total revenues will be so small that it cannot possibly 
make the total surplus excessive. Even if we assume that 50 
of the 103 metered consumers are at present paying only 20 cts. 
per month, the increase in revenue would amount per year to 
50 X 12 X 20 cts., or $120. The average yearly revenue per com- 
mercial consumer is $16.10, which seems to indicate that less 
than half would be reached by the minimum charge, and it seems 
certain that the difference in revenue between present rates and 
the minimum charge will not average as high as 20 cts. per 
month, so that the amount of $120 is undoubtedly greater than 
any actual increase of revenue that would result. 

From the above facts it appears that the minimum charge of 
40 cts. per month is reasonable and just, and 

The Applicant in this case, the Greenwood Municipal Light 
Plant, Is Authorized to discontinue its present rates and to 
substitute therefor the following schedule: 
10 cts. per kw. hr. on meters; 
40 cts. per 16 c. p. lamp, flat rate; 
40 cts. per month minimum charge. 



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64 RAILROAD COMMISSION OP WISCONSIN. 



TIMOTHY L. HARRINGTON kt ai. 

vs. 
THE MILWAUKEE ELECTRIC RAILWAY AND LIGHT COMPANY. 



Submitted March 10, 1910. Decided Dec. 5, 1910. 



Petition alleging excessive, unreasonable and discriminating electric 
power rates for charging electric automobiles. Since the 
filing of the petition respondent has put in effect additional 
optional schedules of rates designed to give concessions to 
off-peak users, as these rates are considerably lower than those 
complaiiied of and appear to follow the cost curve quite closely, 
and as they also appear to be equitable as between the consum- 
ers. It is 

Held: That an order involving any changes of rates would not be 
Justified at this time and the petition is therefore,, for the 
present, dismissed. 

This is a case involving the reasonableness of electric power 
rates for charging electric runabouts. 

On Dec. 28, 1909, Timothy L. Harrin^q:ton. a practicng pliysi- 
cian in the city of Milwaukee, filed a petition containing twenty- 
seven signatures alleging, in part, that The Milwaukee Electric 
Railway and Light Company, a public utility operating a street 
railway system and furnishing electric light and power service at 
Milwaukee, Wis., and vicinity, had made unreasonable charge 
for power service. The petition states : 

1. That a minimum charge of $5 per month for furnishing 
current to charge an electric runabout at 2914 Sycamore street 
is believed to be execcssive and more than is necessary to cover 
the expenses of maintaining meters and service connections, and 
that such minimum charge is in express violation of the com- 
pany's agreement. 

2. That the price charged for current, viz., 8 cts. for the first 
100 kw. hrs. ; 6 cts. for the second 100 kw. hrs. ; 5 cts. for the 
third 100 kw. hrs. ; 4 cts. for the next 300 kw. hrs. ; and 3 cts. 
for all current consumed over and above 600 kw. hrs., is exces- 
sive. Wher/e current can be sold at a profit at a 3 ct. rate, a 



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HABRINCKTON ET AL. i;. T. M. E. R. A L. CO. 65 

charge of 8 cts., it is alleged, is unreasonable and discriminating 
against the small consumer. 

To the complaint, as outlined above, The Milwaukee Electric 
Railway and Light Compamy filed answer on Jan. 8, 1910, admit- 
ting that insofar as it furnishes electric current to consumers in 
the city of Mihvaukee it is a public utility, that its charges for 
power service on file with the Railroad Commission of Wiscon- 
sin are substatttially as outlined in the complaint, and that the 
respondent, Timothy L. Harrington, has been charged the mini- 
mum bill of $5 per month for a rectifier used by him for the 
purpose of charging an electric runabout, in accordance with 
such schedule. Respondent's answer, however, denies the alle- 
gation that such charge is unreasonable, and alleges, further, 
that its rates for electric current have at all times been and now 
are better than reasonable, as far as its consumers are concerned. 

In accordance with the order of the Commission a hearing was 
held on March 14, 1910. Timothy L, Harrington, the petitioner, 
appeared in his own behalf; Edwin S. Ma^k, of Miller, Mack & 
Fairchild, appeared for the respondent, The Milwaukee Electric 
Railway & Light Company. 

At the hearing the following facts were introduced in evidence 
by the, petitioner: That the petitioner has a mercury arc recti- 
fier. of about 5 h. p. capacity, used in transforming alternating 
current to direct current for charging an automobile of about 2% 
h. p. capacity ; that the company has based its minimum bill on 
the capacity of this transformer, but incidentally a part of the 
service used, and wholly unnecessary had respondent extended 
its direct current line so as to cover consumer's premises ; that 
current is used but sparingly during the winter months when the 
snow is deep ; that the minimum amount charged for its services 
aggregates $60 per year, and that it is obviously unjust to base 
a power minimum bill on the size of installation, and a lighting 
minimum bill per consumer, irrespective of the size of installa- 
tion. 

Petitioner asks relief, either in a substantial lowering of the 
minimum bill, or the privilege of applying payments one month, 
when the amount of current used is less than the amount covered 
by the minimum bill, to a subsequent month when the amount 
will exceed that paid for by the minimum charge. 

As to that portion of the complaint relating to the cost of cur- 
rent, it was contended that if current can be sold for f} cts. per 
5— R. D. 



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66 RAILROAD COMMISSION OP WISCONSIN. 

k\v. lir. at a profit, it was manifestly unjust to charge some con- 
sumers 8 cts. for the same service; and petitioner stated that 
several garages in the city of Milwaukee, maintaining isolated 
plants, were reputed to furnish current for as low as 2 cts. per 
kw. hr. generated. 

Attorney for the respondent made little answer to the com- 
plaint and facts as here presented, beyond suggesting that the 
rectifier could be reduced or cut off in some way so as to aggre- 
gate a maximum capacity of 2 h. p., and the minimum bill thus 
be reduced to $2. 

The charging of automobiles is a service usually furnished 
when the demand on the central station is light, and many com- 
panies have therefore accorded it special consideration in their 
rate schedules. To do so appears sound and in keeping with 
the principles of cost of service extensively commented upon in 
previous decisions of the Commission. 

Since presentation of the above petition respondent company 
has filed additional optional schedules of rates designed to give 
concessions to off-peak users. 

Where previously a charge of 8 cts. per kw. hr. was made for 
the first 100 kw. hrs., 6 cts. for the next 100, etc., with a mini- 
mum bill of $2 for an installation of 2 h. p. or less nominal rated 
capacity, and $1 for each h. p. or fraction thereof in addition to 
the first 2 h. p., the optional schedule provides for a demand 
charge of $21 per kw. per year, where the service is not utilized 
during peak hours, plus a charge of 4^^ cts. for the first 100 
kw. hrs., SYo cts. for the next 900 kw. hrs., etc. A cash discount 
of 5 per cent is allowed under both schedules. Further conces- 
sions to off-peak business is made for so-called ten-seven service, 
under which one-half of the above demand charge is assessed 
where the consumer contracts to utilize the company's service 
only during the hours of 10 p.^ m. to the following 7 a. m. 

Tt is stipulated under the latter schedule that the demand of 
the consumer using company's service for power shall be deter- 
mined as the maximum rate at which energy is used for any con- 
secutive period of fifteen consecutive minutes, as shown by an 
integrating watt meter. The capacity of petitioner's runabout is 
slated at the hearing as ^V^ h. p., or 1.86 kws. For purposes of 
computation, a maximum demand may be assumed of 2 kws. 
Calculating out the net monthly bill resulting under the new 



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HABBIN<3m>N ET AL. V, T. M. B. B. A L. 00. 67 

schedules, we find considerable reduction in the charge for serv- 
ice rendered. The computation of petitioner's rate under the 
old schedule, as exhibited at the hearing, is given under **A ;" 
the bill for the same months is calculated under company's off- 
peak schedule under "B ;" and under the so-called ten-seven serv- 
ice under "C." It will be noted that a reduction would be made 
possible in the May bill of from $4.75 to $4.19 and in the June 
bill from $8.00 to $6.17. 



A 

Previous bill as exhibited: 

Month of May 59 Ivw. hrs. used 

59 kw. hrs. at 8cts ^ $4 72 

Mimimum.. Gross bill $5.00 

Discount of 25cts. for prompt pay't. 

Total net bill $4 75 

June 107 kw. hrs. used 

107 kw. hrs. at Sets $8 00 

7 ** '* '* 6" 42 

Total gross bill $8 42 

Discount of 42cts. for prompt pay't 

Total net bill $8 00 



B 

Petitioner's bill when company's off-peak service rate is applied. 
Month of May 50 kw. hrs. used 

Energy charge of 50 kw. hrs. at 4 lets $2 66 

Demand charge 2 kw. at $1 75 3 50 

Maximum bill 5 00 

Total gross bill $5 00 

Discount of 25cts. for prompt payment 

Total net bill $4 75 

June 107 kw. krs. used 

Energy charge 100 kw. krs. at 4icts $4 50 

7 " ** '* 31 " 25 

Demand charge as above 3 50 



Total gross bill $8 25 

Discount of 41cts. for prompt payment 



Total net bill $7 84 



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68 RAILROAD COMMISSION OP WISCONSIN. 



C 

Petitioner's bill when company's ten>seven service rate is supplied. 
Month of May 59 kw. hrs. used: 

Energy charge 59 kw. hrs. at 4icts $2 66 

Demand charge 2 kw. hrs. at .875 1 75 

Total gross bill $4 41 

Discount of 22cts for prompt payment 



Total net bill W 19 

June 107 kw. hrs. used 

Energ>' charge 100 kw. hrs. at 4icts $4 50 

7 ** '* •' 3i ** 25 

Demand charge as above 1 75 

Total gross bill $6 50 

Discount of 33 cts. for prompt payment 

Total net bill W 17 

The optional rates referred to above are considerably lower 
than the rates complained of. This is especially true for long- 
hoiir users. The "ten-seven" schedule is also lower than the 
"off-peak" schedule. Of the two bills presented above, that for 
May represents a shorter daily use of current than the bill for 
June. For the classes of consumers represented by these bills 
the differences between the rates complained of and the "off- 
peak" rates are not very great, but as between the rates com- 
plained of and the "ten-seven" rates there are material differ- 
ences. For the May bill, for instance, the latter rate is about 
one cent per kv.\ hr., or 14 |>er cent lower than the rate com- 
plained of, while for the June bill the latter rate is about 17.2 
cts. per kw. hr., or nearly 30 per cent lower than the rate actually 
charged. In addition to this, the minimum charge under both 
of the optional schedules is much lower than under the rates 
complained of. As s'hort hour customers make a much smaller 
use of the plant and equipment that has been provided and is 
maintained for them than long hour customers, it also of neces- 
sity follows that the former are relatively more costly to the 
plant. Such differences in the cost should be made up by cor- 
responding differences in the rates. If not so made up, some 
will be charged lower rates than they should bear, while for 
others the rates will be too high. Such discrimination should be 
avoided whenever possible, because they are unjust as between 
the various classes of the consumers, and are also likely to retard 
the development of the business of the plant. The optional rates 



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HARRINGTON £T AL. V. T. M. £. R. <fc L. GO. 69 

also seem to be more closely adjusted to the relative cost of serv- 
ing the various classes of the consumers than is the case for the 
rates complained of herein. 

At various times we have also had occasion to inquire into 
the costs per unit of generating and distributing current by the 
respondent company. From the data gathered at these inquiries 
it appears that the cost per kilowatt hour is more than 11 cts. for 
those who use the current one hour daily, nearly 8 cts. for those 
who use the current 2 hours daily, about 61/^ cts. for those who 
use the current 3 hours daily, and about 5i/4 cts. for those who 
use the current 4 hours daily. These costs are based on the oper- 
ating expenses, depreciation, and a return for interest on the 
investment of about 8 per cent on the cost of reproducing the 
plant. When these costs per unit are compared with the amounts 
per unit under the above bills, considerable light is thrown upon 
the situation. It is then found that, in order to be entitled to the 
optional "ten-seven'* rate, the petitioner must use the current or 
installation more than three hours daily. In other words, unless 
the petitioner comes in the three hour or more class, the cost of 
serving him is greater than the revenue that would be derived 
from these services under the so-called "ten-seven" optional rate. 
While the facts presented by the parties in this case do not show 
in what class or classes the petitioner comes, the facts, when 
taken as a whole, indicate that he is in position to take advantage 
of the optional rates which have been mentioned above. And 
since these optional rates appear to follow the cost curve quite 
closely, it would also seem that they go far towards adjusting 
such inequalities as may have existed in the rate schedule com- 
plained of. The optional rates in question also appear to be 
equitable as between the consumers, for they tend very strongly 
to place all consumers in the same class on about the same rate 

basis. ' ' '' \-'^'. : 

In considering the facts which have thus been presented, as 
well as the situation as a whole, it appears to us that at this time 
we would not be justified in ordering any changes in the rates 
complained of in these proceedings. The petition in this case is 
therefore, for the present, dismissed. 



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70 RAILROAD COMMISSION OP WISCONSIN. 



DULUTH-SUPERIOR MILLING COMPANY, 
SUPERIOR TERMINAL ELEVATOR COMPANY 

VS. 
NORTHERN PACIFIC RAILWAY COMPANY. 



Submitted Oct. i//, 1910. Decided Dec. 5, 1910. 



Re-Hearing, in which additional testimony was introduced, briefs 
and memoranda submitted and authorities cited, as to 
whether the switching charges at Superior on grain shipped 
into the state is interstate commerce. 

Held: That such switching is a distinct and separate movement, gov- 
erned by local switching tariff which Is applicable to all 
switching movements, irrespective of the points of origin or 
of the particular carrier or carriers participating in the initial 
interstate haul; that it is supplementary to the Interstate 
transportation rather than a part of it, and therefore sub- 
ject to the jurisdiction of this Commission. The order in the 
original action is not modified. 

Pursuant to notice a re-hearing in the labove entitled matters 
was lickl at the city hall at Superior, Oct. 14-, 1910. Crownhart 
& Foley appeared for the petitioners, Emerson Hadley for the 
respondent. 

Additional testimony was introduced with a view of describ- 
ing definitely the character of the transportation and other trans- 
actions connected with this case. Briefs and memoranda sup- 
plementary thereto, in response to a communication from the 
Commission, were filed by both parties. 

Court decisions and decisions of the interstate commerce com- 
mission, relied upon by the respective parties in support of their 
contentions, are the following: 



CITATIONS ON BEIIALP OP PETITIONER. 

1. Missouri Pacific Ry. Co. v. Larahee Flour Mills Co. 211 

U. S. 612. 

2. Gulf, Colorado & S. F. R. Co. v. Texas, 20-4 U. S. 403. 

3. AVTC York ex rel. Penn. Ry. Co. r. Knight, 192 U. S. 21. 

4. U. S. V. Colo. & N. W. R. R. Co. 157 Fed. 321. 



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DULUTH-SUPfiBlOB MflXING CO. ET AL. V. N. P. R. CO. 71 



CITATIONS ON BEHALF OF RESPONDENT. 

1. Rhodes v. Iowa, 170 U. S. 412. 

2. McNeill v. So. Ry. Co. 202 U. S. 543, 559. 

3. U. S. V, Union Stock Yards Co. 161 Fed. 919. 

4. /. C. C. V. C. B. & Q. R. Co. 186 U. S. 320. 

5. Central Stock Yards Co. v. L. & N. Ry. Co. 118 Fed. 113. 

6. Gulf, Colorado & S. F. Ry. Co. v. Texas, 204 U. S. 403. 

7. West Texas Fuel Co. v. Texas Pacific Ry. Co. 15 I. C C. R. 

443. 

8. JVest Texas Fuel Co. v. Texas Pacific Ry. Co. 17 I. C. C. R. 

491. 

9. Minneapolis Threshing Machine Co. v. Omaha Rv. Co. 17 

I. C. C. R. 189. 

10. Laninff'Harris Coal etc., Co. v. Atchison, T. & F. S. R. Co. 

12 I. C. C R. 479. 

11. Commercial Club r. Sou. Pac. 12 I. C\ C. R. 495. 

12. State of Mo. v. Atchison, T. & S. F. Ry. Co. 176 Mo. 687. 

13. Fielder v. M. K. & T. Ry. Co. 42 S. W. Rep. 362. 

An examination of the various cases cited shows that the ques- 
tion involved is a very close one. Strong excerpts from some 
of these decisions can be adduced in support of the contention 
that the transportation in question is inter-state; similarly other 
quotations may be cited to show that it is intra-state. 

The salient facts appear to be these : Grain is shipped from 
various points on the Soo line outside of Wisconsin to Superior, 
Wis. Sometimes this grain is sold before it is shipped; some- 
times it is sold in transit ; and sometimes it is not sold until after 
its arrival in Superior. After the sale of the grain it is custom- 
ary for the consignee to give an order to switch a car or cars to 
the place designated by the purchaser. This order appears t(j 
be customarily issued through a local bureau. 

Both parties to this proceeding agree that the question of the 
particular ownership of the grain at one point or at a specific 
time is immaterial in the determination of the character of the 
transportation with respect to its being inter-state or intra-state. 
This position we believe to be fully and consistently sustained by 
the cases cited. It therefore follows that questions of liability in 
case of loss or damage are immaterial in determining the one 
point at issue. In determining the intra-state or inter-state 
character of the shipments in question the force of the original 
bill of lading is important, although the time when and the place 
where the original bill of lading is transferred by the consignee 



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J 



72 RAILROAD COMMISSION OF WISCONSIN. 

to another party does not appear to us to be decisive. This 
transfer appears to us to be more closely associated with ques- 
tions of liability for loss and damage. 

In respondent's brief considerable stress is laid upon the fact 
that the Soo Railway Company absorbs switching charges for 
switching movements, similar to or identical with those in con- 
troversy, on all grain originating at competitive points. The 
assumption which underlies this contention is, apparently, that if 
the Soo absorbs such switching charges it thereby causes a ship- 
ment to become inter-state from the point of origin to the point 
to which such switching is done. This process of reasoning does 
not appear to us to be conclusive. It would doubtless be difficult 
to maintain that grain shipped from competitive points and ulti- 
mately unloaded at one of the elevators of the petitioners herein 
was subject to federal statutes, and that grain shipped from non- 
competitive points to the same elevator was subject to the stat- 
utes of the state of Wisconsin, simply because in the former case 
the common carrier at the point of origin absorbed the final 
switching charges and in the other case it did not. It is con- 
ceivable that the Soo Railway Company might hire teams for the 
conveyance of grain from its cars to petitioners' elevators and 
pay the cost of this transfer. The amounts thus paid to the 
owners of the teams would correspond to the switching charges 
which the Soo absorbs under the conditions given. If the ab- 
sorption of the charges is the decisive factor, then the shipment 
of grain remains inter-state to petitioners' elevators, and such 
inter-state transportation includes the transfer by team. Upon 
this hypothesis the interstate commerce commission would have 
jurisdiction over the teams doing this work. The untenability 
of this position is shown by one of the cases cited: New York 
ex rel, Penn. R. R. Co. v. Knight, 192 U. S. 21. 

Viewing this situation entirely independent of technicalities 
discussed in a number of the cases cited, it appears to us that 
the switching service performed for the petitioners by the North- 
ern Pacific Railway Company in transporting cars from the lines 
of the Soo to petitioners' elevators is analogous to and practically 
identical with a similar transfer by team and wagon, as assumed 
in the illustration just given. The switching is. not done under 
the original contract of transportation. Neither the bill of lad- 
ing upon which the shipment moved nor the inter-state tariff ap- 
plicable to the movement apply to the actual switching in the 



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DULUTH-SUPERIOB MILLING CO. ET AL. V, N. Pi B. CO. 73 

city of Superior. This switching is a distinct and separate move- 
ment, governed by the local switching tariff which is applicable 
to all switching movements, irrespective of the points of origin 
of the cars or of the particular carrier or carriers participating 
in the initial inter-state haul. The switching movement may be 
regarded as an act of transportation supplementary to the inter- 
state transportation rather than as a part of it; and as such we 
are inclined to the view that the switching in question is subject 
to the laws of the state of Wisconsin, and that therefore the or- 
der of the Commission is applicable thereto. 

It is well understood that the purpose of the Inter-state Com- 
merce Law is generally the same as that of the Wisconsin Rail- 
road Law, namely, to regulate transportation by common carrier. 
The public interests which are involved in both state and inter- 
state traffic are, in a large way, identical, and so far as these 
interests are concerned, it is immaterial whether the administra- 
tive agencies which are invoked are federal or state; both agen- 
cies have their proper and well defined sp^here of activity. In the 
instant case the exact character of the transportation in question 
appears to be somewhat nebulous when viewed through the vari- 
ous citations listed above. However, in looking at this question 
from the point of view of the actual traffic as it is conducted 
locally, we are constrained to hold that the weight of the evi- 
dence balances in the direction of declaring this traffic intra-state 
and therefore subject to the jurisdiction of this Commission. 

It follows that the order issued Sep. 14, 1910, will not be modi- 
fied. 



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74 RAILROAD COMMISSION OP WISCONSIN. 



CITY OP WASHBURN 

vs. 
WASHBURN WATER WORKS COMPANY. 



Decided Dec. 6, 1910. 



Petition alleging that the rates charged by the respondent are exces- 
sive, unreasonable, and unjust, and that the respondent re- 
fuses to allow the use of meterrs. It was contended by respon- 
dent that the rates charged are the franchise rates and are 
Just and reasonable; that It is optional with the respondent, 
under the franchise, whether to allow the use of meters. A 
valuation of the physical property was made; the cost new 
was found to be $69,342, present value $63,803; 41.3 per cent 
of this value is devoted to the service of private consumers 
and 58.7 per cent to municipal service. A statement of the 
financial operations of the respondent Is given. The computa- 
tions submitted by the respondent to show present value con- 
tain unsettled hydrant rentals for the years 1895 and 1896 
which are in litigation, and an item, of $600 as salary for a 
manager which was not, in fact, paid. In the computations 
made by the Commission the hydrant rentals are considered 
as paid in the years due and the item for manager's salary Is 
eliminated for the reason that the persons regularly employed 
were fully competent to operate the plant and the operating 
ratio of the plant is sufficiently large without this additional 
item. Compilations are made showing the financial history 
of the company. 

Held: That In the Constitution the state has reserved the right to 
amend, alter or repeal any franchise granted by the state or 
by any municipality; that neither a municipality nor the legis- 
lature has the power to grant either by special or general act 
any franchise which can not be altered, amended or repealed 
by the legislature; that the legislature, in granting a public 
utility the right to surrender its franchise and receive in lieu 
thereof an indeterminate permit, did not thereby make it op- 
tional with the utility whether it would subject itself to the 
regulatory powers of the Commission or not; that under the 
Public Utilities Law the Commission has the power to issue 
an order in violation of the terms of an existing franchise; 
that the respondent is financially able to install meters and 
their installation is ordered. The question of rates is held In 
abeyance until the meters have been In operation for six 
months or a year. 

The petitioner alleges that the respondent is a utility engaged 
in the business of furnishing water to the city of Washburn and 
its inhabitants ; that the respondent has since the year 1889 fur- 
nished such water under the terms of a contract and ordinance; 
that respondent is the assignee of Weston Lewis and J. S. 
Maxcy, with whom such contract was entered into by the town 



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CITY OF WASHBURN V, WASHBURN WATER WORKS CO. 75 

of Washburn; that petitioner, the city of Washburn, is the suc- 
cessor of said town of Washburn and tliat said contract is now 
in effect between the petitioner and respondent. 

The petition further alleges that the rates set forth in sec. 14 
of said ordinance are the rates now charged by respondent to 
private consumers of water in said city; that respondent has 
charged such rates to private consumers of water in said city 
ever since it began to furnish water as aforesaid ; that heretofore, 
and on Dec. 15, 1908, the common council of said city of Wash- 
burn, at a meeting thereof, duly passed a resolution which is 
made a part of the said complaint, to the effect that all rates set 
forth of sec. 14 of said ordinance, so charged by the respondent 
to private consumers of water in said city, for such water, are 
excessive, unreasonable and unjust; that although by the terms 
and provisions of said ordinance it is optional with private con- 
sumers of water in said city to pay respondent for water con- 
sumed by them either at the annual rates set forth in sec. 14, or 
by meter rate also set forth in said sec. 14, still respondent re- 
fuses to allow any private consumer to exercise such option and 
refuses to allow any private consumer of its water to measure the 
water he uses by means of a meter or otherwise, and refuses to 
accept payment therefor at the meter rate stated in sec. 14, or 
any meter rates whatsoever to private consumers in proportion to 
the amount of water used by them; that respondent furnishes 
water to petitioner for fire protection by means of hydrants, and 
for other public purposes, and makes a charge of $5,300 per an- 
num, and that such charges are excessive, unreasonable and un- 
just. 

Wherefore, petitioner prays that the respondent be required to 
substitute for the raAes now charged to said city and its inhabi- 
tants such rates as shall be reasonable and just. 

The respondent admits, among other things, that it has since 
the year 1889 furnished water under the terms and conditions of 
an ordinance passed by the town of Washburn May 6, 1889 ; that 
respondent is the assignee of Weston Lewis and J. S. Maxcy of 
the ordinance mentioned above ; that the city of Washburn is the 
successor of the town of Washburn ; that the contract made in 
said ordinance now exists between the petitioner and respondent 
and that the schedule of rates set forth in said ordinance are the 
rates which respondent has charged and is now charging to its 
private consumers. 

The respondent denies that it is optional with the private con- 



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76 RAILROAD COMMISSION OF WISCONSIN. 

siimcrs to pay for the water consumed by annual rates or by 
m«eter rates, and, on the contrary, alleges that sec. 14 of said 
ordinance distinctly states that said grantee or assignee shall 
have the right at will to supply consumers at meter rates instead 
of at assessed rates ; and denies that the rates charged petitioner 
for fire protection and other public purposes are excessive, un- 
reasonable, or unjust, but, on the contrary, claims that the rates 
are strictly in accordance with the terms of the contract existing 
between petitionei* and respondent. Wherefore respondent prays 
that these proceedings be dismissed. 

The hearing was held on Jan. 28, 3910, at the office of the 
Railroad Commission in the city of Madison. John Walsh, city 
attorney, appeared for the petitioner, and E. M. Smart for the 
respondent 

The petitioner offered in evidence a statement made up from 
the books of the company and showing the earnings, expenses 
and cost of the plant. This statement will be discussed more 
fully below, and only certain general items will be adverted to 
here. 

The testimony of the treasurer of the company respecting the 
first item of $65,000, representing the physical value of the plant, 
is, that such amount is the actual investment in the original con- 
struction, and that the amounts stated on the same line for suc- 
ceeding years represent the same ainount with the cost of addi- 
tions to the plant and the cost of operations in excess of the 
income derived. He admitted that it is an error to include in 
such statement some of the extensions that were made, as a 
number of the service pipes were paid for by the owners of the 
property served. A statement was offered showing the number 
of feet of pipe in each of such services. According to this state- 
ment 950 feet of % inch and 460 feet of l^A inch services were 
thus paid for by property owners. -The average cost of the % 
inch pipe is 40 cts. per foot. The cost of the VA inch pipe was 
not given, but it was said that the excavation for the same was 
30 cts. per foot, and that the maximum price for such pipe 
would not be more than 11 cts. per foot. 

Bonds were authorized to the amount of $75,000 for constnic- 
tion, but only $65,000 were actually issued, the balance of $10,000 
being held by the stockholders. 

During the first ten years the town paid the taxes tinder the 
terms of the franchise. The company began i>!aying taxes in the 
year 1900. That year they amounted to $2,294. This is the 

Digitized by VjOOQIC 



CITY OF WASHBURN V, WASHBURN WATER WORKS CO. 77 

amount receipted for by the town treasurer and does not include 
the cost of litigation to collect such taxes. 

An item of $3,089.18, showing a heavy expense, is found in 
the general expense account for 1894. It was not clearly shown 
what caused this increased expense for that year. During the 
years 1895 and 1896 the town operated the plant and the ex- 
pense for the first year dropped to $1,515.88, and the following 
year to $2,689.10. The increase was due to putting in free serv- 
ices. In the year 1904 cost of litigation with the town of Wash- 
bum, in reference to taxes and hydrant rentals, was included 
and as a result the expense for that year amounts to $2,735.81. 

(General expenses amouiTting to $2,808 are charged! in the year 
1909, which is about $400 more than for the previous year. Wit- 
ness explained this as being due to the payment to him of back 
salary. He receives a salary of $400 a year, but in 1908, on ac- 
count of lack of funds, he only drew $200, and the balance of 
his salary for that year, together with his salary for 1909, was 
paid in the latter year. Also an item of $500 for attorneys* fees 
is found in the annual report to the Commission for 1909. The 
superintendent receives a salary of $780 per year. In addition 
to the salary of $400 for the collector of rentals and $780 for the 
superintendent, an item of $600 per year is added as salary for 
a manager of a plant of this size. This was made as a sugges- 
tion, because no such expenditure was actually received or paid. 
There is an increase from 1908 to 1909 of nearly $1,200 in 
private services. 

In addition to the bonded indebtedness there are notes payable 
to the amount of $46,000. In 1894 an additional issue of bonds, 
amounting to $25,000, was made and is held by the stockholders. 
The floating indebtedness, amounting to $46,000, is owing in equal 
amounts to the stockholders. 

The stockholders have been paying the interest each year, 
which amounts to about $6,000. The yearly cost of operation is 
about $6,000 less than the net earnings. No depreciation has 
ever been charged in the operating expenses. There are a few 
meters in use, one in a parochial school, one in the town build- 
ing, and one in the clerk's office. Consumers are not permitted, 
generally, to install meters. 

The flat rates charged are the maximum rates provided for 
in the franchise and are based upon the number of rooms sup- 
plied and facilities used. The charge for the first four rooms in 
a house is $10 per year, and $1 for each additional room. Five 

Digitized by VjUOQIC 



78 



RAILROAD COMMISSION OF WISCONSIN. 



dollars is charged for a bath tub and $5 for a closet. The city of 
Washburn has gradually declined during the late years, having 
now only about 3,000 population. This is attributed to the ex- 
haustion of the timber supply and the burning of two of the 
large saw mills. Farming is not yet fully developed, and it will 
take some years before the surrounding lands are cleared up. 

These are the leading points brought out in the testimony. It 
remains now to bring these various statements into their relation 
with additional facts secured by the Commission. 

In accordance with its established custom, the Commission 
caused a valuation to be made of the physical property of the 
Washburn Water Works Company, a summary of which is given 
below : 

TENTATIVE VALUATION OF PHYSICAL PROPEKTY 

OF THE Washburn Water Works CoMrANT. 

Novmnber 15, 1909. 



Group. 



Classification. 



Cost new. 



l*re}>ent 
value. 



10 



12 



Ifl 



Land 

Intake and auctions 

Reservoir 

Digtribution system 

Power plant equipment 

Bulldinifs and miscellaneous structures. 

Office furniture and appliances 

Tools, Implements and machinery 

Horses, wagons and miscellaneous 



Total, Items 1—9 

Add 12% (see note below). 



$190 
2.010 
4.107 

4.968 

4.893 

S2 

227 



91S0 
2,706 
8,060 
42.074 
2.502 
8.85S 
10 
114 



foi.iao 

7,887 



»56,2» 
0.7M 



Total, Items 1—10. , 
Stores and supplies..., 



Total, Items 1—11. 
Paving 



f«.i76 

an 



160.137 



651 



163.700 



Total. Items 1—12. 
Unoperated property.. 



|ao>187 
206 



$68,700 
106 



Grand total, Items 1-^18.. 



$60,843 



$68,808 



NoTi: -Addition of 12% to cover cost of en^Lneerinflr and superintendence. Interest 
(luriuf? construction, continjfcncles, etc. 

The aggregate of this property was again subdivided into prop- 
erty devoted to the service of private consumers and that devoted 
to the service of the municipality, with the result that 41.3 per 
cent was assigned to the former, and 58.7 per cent to the latter. 

Since both the company and the city have accepted this valua- 
tion of our engineers upon the record, it is unnecessary to dis- 
cuss it further. 

The results of the operation of the plant were summarized in 
respondent's exhibit "A," reproduced below : 



Digitized by VjOOQIC 



CITT OF WASHBURN V. WASHBURN WATER WORKS CO. 



79 



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Digitized by VjOOQIC 



80 RAILROAD COMMISSION OP WISCONSIN. 

An examination of the books of the company confirms the 
substantial correctness of exhibit ''A/' with the exception of 
the statement of receipts for hydrant rental during the years 
1895 and 1896. The books of the company show that a part of 
the regular hydrant rental has been actually received by it and 
this part has not been included in its statement of revenues as 
submitted to the Commission. It appears that the hydrant rental 
for the first half of the year 1895 is being litigated with the town 
of Washburn, from which the city was separated at about this 
time. The hydrant rental for the second half of 1896 is in con- 
troversy with the city of Washburn. We understand that suits 
involving hydrant rentals are now pending. 

During a part of this period the company apparently did not 
operate the plant directly. We must assume that if the company 
actually provided the service during the periods in controversy 
the courts will award it just compensation for such service. 
Should the courts find that the service has not been properly 
performed and that the company is not entitled to compensation 
such as it claims, the Commission would scarcely be justified in 
taking the amount of the difference, whatever it may be, between 
the sums claimed by the company and the actual award of the 
courts into consideration in arriving at a judgment with respect 
to the financial results of the operation of the plant and capitaliz- 
ing this difference against the consumers for practically all time 
to come. 

The item of hydrant rental for 1895 and 1896 results in a dif- 
ference of many thousands of dollars in the tables showing the 
financial condition of the plant at the present time. By calcu- 
lating interest upon s|?4,850 from 1895, and upon the same 
amount from 1896, annually, to the present time and adding this 
to the original principal, a large sum is charged against the 
property for the year 1910. We do not believe that such a 
charge is equitable, nor is it lawful. In our calculations we have 
assumed that the company did actually receive the usual amount 
of hydrant rentals during the years 1895 and 1896. If the com- 
pany can not recover the whole of whatever amount it claims 
is due from the town of Washburn and from the city of Wash- 
burn, it must be because, after a fair trial in court, it is foimd 
that the company is not entitled to it; and if the company is not 
entitled to it, it can hardly be claimed that the Commission 



Digitized by VjOOQIC 



CITY OP WASHBURN V. WASHBURN WATER WORKS CO. 81 

should capitalize the amount in controversy against the water 
consumers in the city of Washburn. 

Aside from the item of hydrant rental, there is very little 
deserving special attention so far as the accounts are concerned. 
A clerical error, amounting to some $50, was discovered in the 
general expenses for one of the years ; and several much smaller 
differences were discovered with reference to a niunber of other 
items. None of these can have any material effect upon the final 
result, and all are apparently clerical errors, such as can easily 
creep into calculations of this kind. 

A number of items, covering expenses apparently quite i>er- 
sonal, were observed in the accounts for the year 1890. The 
most of these were small and perhaps require no further atten- 
tion. 

The respondent submitted compilations purporting to show 
the amount of the going value chargeable against private con- 
sumers of the city. In its exhibit "C" the respondent calculates 
going value estimated upon an original investment of $65,000 
in the year 1889. There is added to this amount the interest 
for the year, the amount of new construction, and loss or profit 
from operation, and the salary of the manager at $600 per year. 
This formula is followed for each of the years from 1889 to 
Jan. ], 1910, upon which date a plant value of $120,555.70 
is arrived at. 

In respondent's exhibit "D" going value is estimated on the 
cost of reproduction in present condition, as reported by our 
engineers. An original cost of $48,462.54, representing the en- 
gineers' value, less the cost of extensions and improvements, is 
assumed. The mathematical processes of this exhibit follow the 
.same formula that was followed in exhibit "C,"' the rate of in- 
terest in each being 7 per cent and the salary of the manager 
$600 a year. The value arrived at in exhibit *'B," as of Jan. 
1, 1910, is $89,132.31, or almost exactly $20,000 in excess of the 
cost of reproduction new reported by our engineers, while ex- 
hibit ''D" effects an excess of over $50,000. 

An examination of these two exhibits shows that the chief 
cause of the excess over the cost of reproduction new, as re- 
ported by our engineers, is the amount of the hydrant rental 
for the years 1895 and 1896, partly paid in and partly in dispute, 
as stated above. .The next important cause is the amount attri- 
buted to managerial services, of $600 a year. With respect to 
6— R. D. 



Digitized by VjOOQIC 



82 RAILROAD COMMISSION OF WISCONSIN. 

this claim for $600 a year for superintendence, it should be stated 
that the operating ratio of the Washburn plant, as compared 
with the ratio for other plants, such as those included in a table 
contained in a decision of this Commission in the case of City 
of Ashland v, Ashland Water Co. 4 W. R. C. R. 278, 282, and 
in the table given below, suggests that a sufficiently large sum has 
been charged against the respondent's plant for management. 
There is nothing in the testimony to show that the persons 
regularly employed in connection with the property in Wash- 
burn and whose salaries are now charged to operating expenses 
were not fully competent to operate the plant without any ad- 
ditional superintendence, nor that the amount so charged is not 
generally sufficient to secure whatever managerial ability is re- 
quired in the oj^eration of a plant of this size. We therefore feel 
constrained to exclude the claim of $600 a year from our cal- 
culations regarding the financial results of operation of respon- 
dent's pilant. 

The table immediately following shows the operating ratios 
of a number of plants with which the Washburn plant is fairly 
comparable : 



Digitized by VjOOQIC 



CITY OF WASHBURN V. WASHBURN WATER WORKS CO. 



83 





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Digitized by VjOOQ IC 



84 RAILROAD COMMISSION OP WISCONSIN. 

In order to arrive at a judgment with respect to the return 
upon the investment in respondent's plant for the entire period 
of its operation, we have made a number of compilations fol- 
lowing slightly different methods and assuming two different 
initial values. All of these tables practically explain themselves 
and require little or no comment. 

Tabic I assumes an initial value of $55,474.83. This amount 
was arrived at by deducting from the cost of reproduction new, 
as determined by our engineers, the amount of the extentions 
and new additions made during the. respective years. There 
was some question regarding the actual amount of the invest- 
ment made by the company in 1889, and it appeared to us that 
this process was .safer and more reliable than any other that 
could be adapted in this case. Upon an average value of the 
investment as thus found for each year, interest was calculated 
at 6 and 7 per cent, respectively. Depreciation was calculated 
at somewhat less than one-half of one per cent per annum, this 
being the average rate of depreciation actually found for all 
those plants for which the composite life has been established by 
our engineering staff. As stated in the table, depreciation was 
estimated on the 4 per cent sinking fund basis. The other 
columns in table I readily explain themselves. 

The construction of table II is identical in form with that of 
table I, except that table II assumes an original investment in 
1889 of $65,000. Table III presents a summary of the net re- 
sults as shown in tables I and II, calculated on a 6 and 7 per cent 
interest basis, and the initial value as shown in the respective 
columns. From this summary it appears that the business of 
the Washburn water works plant netted its owners, during the 
entire period of its operation, an aggregate surplus of $64,878.93 
when the initial value of $55,474.83 is taken as a basis. Using 
the same initial value as a basis, but estimating interest at 7 per 
cent — on all items, investment, deficit and surplus — the accu- 
mulated surplus amounts to $42,257.45. With an assumed 
initial value of $65,000. the accumulated surplus is about $41,- 
265.09 and $12,609.37, resi>ectively. 



Digitized by VjOOQIC 



CITY OP WASHBURN I'. WASHBURN WATER WORKS CO. 



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Digitized by VjOOQIC 



86 



RAILROAD COMMISSION OP WISCONSIN. 



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Digitized by VjOOQIC 



CITY OP WASHBURN V, WASHBURN WATER WORKS CO. 



87 



TABLE III. 

ACCUMULATED DEFICITS OF THE WASHBURN WATER WORKS 

Based on Last CoLtTMNS of Tables I aivd TI. 





* Accumulated deficits on basis of original investment of 


At end of year. 


855,474.83« 


•86,000 




6% Interest. 


7% Interest. 


0% Interest. 


7% Interest. 


1889 


11.206 16 
4.488 31 
6,432 48 
4,078 01 
2,900 SO 

8S8 98 

10,125 20 
14,811 88 

19,864 41 
21,691 96 
25,396 98 
31,360 18 
36,042 16 

40,768 88 
46,120 30 
50,496 07 
55,189 10 
69,22k 77 

64,8n8 98 


$1.486 56 
5,240 68 
7,912 98 
6,979 47 

o.iee 46 

4,427 34 
8,470 97 
117 79 
3,093 62 
8,780 88 

10,198 18 
11,301 53 
18,908 78 
18,618 SO 
22,089 12 

S2,41t 54 
35,651 27 
38,177 76 

48,2S7 46 


$1.448 20 
6.258 88 
7,6«7 99 
6,792 17 
5,814 88 

8,906 42 
2,928 40 
246 82 
3,526 69 
7,202 88 

10,677 31 
11,'}86 66 
14,389 88 
39,069 18 
22,410 87 

28,696 97 
28,649 66 
32,309 11 
38,297 51 
37,626 26 

41,265 09 


fl.612 49 
8,126 £6 


1890 


1691 


9,682 18 


1«« 


8,462 53 
9.607 28 

8,72i 57 


itm 


1804 


1896 


8,777 as 


1896 


8,604 64 


1807 


4,449 06 


1888 


2,047 91 


1899 


9264 


1900 


2m 91 


1901 


884 96 


1902 


8,974 20 


1908 


8,88126 


ISO* 


7,209 38 


1J05 


8,287 13 


IflOG 


10,070 16 


I<rt7 


11,036 7S 


yjOS 


11,131 68 


isoo '.. 


12,609 87 







iltalic flffures represent negatlTe deficit or surplus. 

'Engineer's estimated cost of reproduction at end of 1900, less costs of extensions 
ns found on respondent's books. 



Digitized by VjOOQIC 



88 



RAILROAD COMMISSION OP WISCONSIN. 



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CITY OP WASHBURN V. WASHBURN WATER WORKS CO. 



89 



TABLE y. 

STATEMENT OF SDRPLUHE8 AND DEFICITS OF THE WASHBURN WATER 

WORKS 
Based ON CoRRBCTBD Nkt Earnings, and on Initial Valub or 166.475. 



Year. 


6% basisi 


7% basisi 


]88» 


3,185 

i|T56 
1,689 

2.688 
1.004 
4.848 
4.28S 

4.687 

4,543 
2.289 
3.806 
U.964 
4.004 

4.717 
4,872 
5.900 
4.096 
4.067 

5.055 


Vti97 


18M> 


8.m 


18P1 


f.ft7i 


IB98 


985 


18B8 


8i6 


]g94 


l,72r> 


18B6 


1 057 


IflM 


S.354 


18B7 


8.21-2 


U08 


8.637 


ISBQ 


3,402 


1900 


1,111 


1801 


2.608 


1902 


4.711 


iao3 


8.423 


1904 


' 3.404 


1906 , 


3.015 


1900 


3,900 


1907 


8,241 


1909 , 


2.529 


1900 


4,061 






Total BUrDluSM 


164.907 


^ 142.280 





^Italic flffurcs denote deficits. 



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90. 



RAILROAD COMMISSION OP WlSCONStN. 



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CITY OP WASHBURN V. WASHBURN WATER WORKS CO. 



91 



TABLE VII. 

STATEMENT OF SURPLUSES AND DEFICITS OF THE WASHBURN WATER 

WORKS, 
Basbo on CoBBsoTED Net Eabnings. axd on Initial Value of $d5,000. 



Year. 


6% bases' 


7% basis* 


1889 


S,806 
$,90S 
1,006 

m 

1,8M 

i.an 

8.095 

8.492 
l.ldi 
2.086 
4.708 

s.aio 

2.881 
3.788 
S.OdO 
2.251 

8.T72 




1800 


1801 


I8BS :.... 


law 


6S 


18M 


780 


1BB6 


S6 


1006 


2,m 

t.066 
2.808 

908 


1897 


18B6 


ySB9 


1900 


IflOl 


1.001 
S,087 
1.686 


1003 , 


1906 


190* , 


1,646 
1,025 


1906 


1900 


1.881 


1907 


988 


1908 


01 


1900 


i,m 




Total surpliuea 


^1.858 


912*860 





1 Italle flsnres denote deficits. 

Tables IV, V, VI and VII represent a compilation of tlie same 
figures upon a somewhat different basis. Each set of tables, 
namely, I, II and III in the first group, and IV, V and VI in the 
second group, may be regarded as a check upon the other; the 
total surpluses and deficits, according to this method, are shown 
in tables \' and \'1I. It will be observed that the totals of these 
two tables are approximately equal to the totals shown in 
table III. 

Respondent's exhibit ''E" is the trial balance for the year end- 
ing Dec. 31, 1909. This shows, among other things, capital 
stfKrk outstanding $100,000, bonds $100,000, notes payable 
$46,000. In view of the fact that the value of the physical pro- 
perty, as given above, has been accepted as approximately cor- 
rect by both parties, and in further view of the amount of the 
going value, so-called, which has l)cen arrived at in tables I to 
YU, inclusive, we do not deem it necessary to enter at length 
upon a discussion of the balance sheet and the integrity of the 
item "Notes payable," $46,000, and other items in the trial 
balance. 



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92 RAILROAD COMMISSION OP WISCONSIN. 

It should also be remarked that some extensions which have 
been paid for by consvuners are included in the company's ex- 
hibit **A" and to that extent the net results arrived at by com- 
pilations based upon this exhibit are too favorable to the com- 
pany. It is well understood that, as a matter of equity, the Com- 
mission does not include services paid for by constuners in the 
valuation of public service property for the purpose of es- 
tablishing rates. 

One of the chief contentions of the city is the failure of the 
respondent company to install meters. The question of meters 
first came officially before the Commission in the case of the 
Hudson Municipal Water Plant, and in its decision in that case 
the Commission held that the water plant must provide meters for 
its consumers and that it can not compel consumers to purchase 
meters. In support of this conclusion certain paragraphs from 
the Utilities Law as well as a number of court decisions are 
cited. See 3 W. R. C. R. 138, 141, 145. 

Since the decision in the Hudson case was rendered, the legis- 
lature has created a different situation by enacting ch. 213, 
Laws of 1909, in accordance with which the public utility may, 
on application to the Commission, be exempted from the duty 
of providing meters for its consumers. No such application 
has been made by the respondent in this case, and therefore it 
is responsible for providing meters for its customers. 

Regarding the soundness of the policy of providing meters 
there can be no question from any point of view. It is a well 
understood fact that flat rates universally result in excessive 
and wasteful consumption, and in unjust discriminations in 
diverse forms, and in irritation and ill-feeling among the con- 
sumers as to a schedule of rates, which at best is uncertain and 
guess work. We believe that a persistent and aggressive policy 
of installing meters in all branches of public utility service is 
in the interest of public utility plants as well as in the interest of 
the consumers. A quotation from a recent paper by a gentleman 
who has had much experience in the management of private 
water works, will be interesting. 



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CITY OP WASHBURN V. WASHBURN WATER WORKS CO. 93 



(R^rinted from Proceedings of the Second Meeting of the Illinois Water Supply Asso- 
ciation, Urbana, 111.) 

Shall We as Water Companies Furnish the Private Serv- 
ices OF Our Patrons Free up to and Including the 
Meters? 

By E. p. Wheeleb.* 

•< 4t * :^ What I have to oflFer in this paper, will consist 
of siKh considerations as seem to me to justify water companies 
in furnishing meters free to their patrons, and the private serv- 
ices as well, at least up to the meters. These considerations have 
had such weight in my own mind, that I have already introduced 
the practice in one of the plants I am operating. 

'*Tliis step seems to me to be justified, because, so far as the 
meter is concerned, it falls into line with general business usage. 
In accordance with such usage, the seller furnishes the means 
of measuring and weighing the articles he sells. * * * 

" * * * if we compel a customer to pay for his own 
meter, he will submit to it as a matter of necessity, and not 
because he is convinced it is right. He is all the less convinced 
when he sees that his own sense of right is re-inforced by the 
uniform usage of all the rest of the business world. * * * 

'* * * * Personally I have come to believe that the charg- 
ing of the meter upon the customer is one of those acts which 
justly invites a feeling of unfairness on the part of the patron. 
I also believe that for this reason the company should furnish 
it. * * * 

« 4t 4t * -^Ye find in our own experience that the response 
to a free meter and free service policy immediately precipitates 
a large number of orders for water from classes who would 
otherwise have waited for years for the connection. The addi- 
tion of this class of customers is an advantage in many ways. 

* * :¥ 

« 4: 4^ 4t ^ second objection raised to the free meter and 
service is that the returns for water under conditions of mini- 
mum rate charge do not afford sufficient returns to make the 
investment pay. * * * 

*' * * * So far as this experiment has gone, we have had 
no reason to complain about the paying character of the invest- 
ment. 

"A third objection will be made to this f re-e policy. It is that 
in certain cases the parties may leave the property before the 
company has had time to recover on its investment. In our own 
practice we have made parties who were shaky, i>ay for such 
free service when put in, and have repaid them by crediting up 
to them the charges for water as they accrued. In this way we 
have insured ourselves against all losses so far. * * * " 



• MftOAffer Lake Vorest Water Oo. 

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94 RAILROAD COMMISSION OF WISOONSIK. 

The engineer of the Commission made an estimate of the prob- 
able cost of installing meters in the city of Washburn. This 
is found to be between $6,000 and $9,000, depending upon the 
number of meter pits the company is required to construct. 

We are well aware that many water companies, especially 
those operating in small communities, regard the installation of 
meters as a hardship. We doubt the soundness of this position. 
In the instant case the results of the operation, as shown in the 
series of seven tables, proved conclusively that the water business 
in Washburn is fully capable of assuming this burden. It is true 
that the testimony shows that the city of Washburn has not l)een 
as prosperous as might be wished, but we believe it is also true 
that a public utility should, for its own good and for the good 
of the community, voluntarily share in the general prosperity 
of the city. The aggregate rate of return upon the investment 
in the water business in the city of Washburn may possibly not 
be regarded as excessive, depending primarily upon the method 
of calculation and the magnitudes adopted as basal sums, and 
the point of view of the person expressing the judgment with 
reference to this rate of return. 

However great the diversities in such judgment may be, we 
do not believe that it can be fairly held that the company has 
not been sufficiently prosperous in its Washburn business to as- 
sume the burden of installing meters in the immediate future. 
In advance of the installation of meters and detailed accurate 
information with respect to the quantities of water consumed 
by the municipality and by private consumers, respectively, it 
will obviously be impossible to prescribe a complete schedule of 
rates. After the meters have been installed for a period of six 
months or one year and the necessary facts regarding the water 
consumption have been ascertained, it will be relatively easy to 
establish a schedule of just and reasonable water rates for both 
the municipality and private consumers. Because this schedule 
can not be worked out at the present time, we refrain from 
making the usual additional classification and analysis of operat- 
ing expenses. The manner in which such preliminary calcu- 
lations necessary in the establishment of rate schedules are made, 
has been discussed in the numerous earlier decisions. So far 
as water cases are concerned, we refer to City of Ashland v. 
Ashland Water Co. 4 W. R. C R. 273 ; In re Appl. Madison 
Municipal Water Works, 3 W. R. C. R. 299; Christum Vick 
ft al V, Madison Municipal Water Works, 5 W. R. C. R. 731. 

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CITY OP WASHBURN V. WASHBURN WATER WORKS CO. 96 

Thus far nothing has been said in this report regarding the 
franchise held by the respondent company. The company takes 
the position that it can not be required to install meters because 
the fratKhise expressly makes this optional with Dhe company. 
The franchise does not extend this option to consumers. 

The franchise likewise prescribes the maximum schedule of 
rates. These maximum rates are apparently in effect at the pre- 
sent time. If the franchise is, as the company claims, a con- 
tract which cannot be altered or amended without the consent 
of both parties to the contract, the Commission is powerless to 
make an order. However, we take the position that under the 
Constitution and the Public Utilities Law this franchise is not 
a contract ^vlllch binds the city of Washburn to the terms of 
that franchise for all time to come and which forever prevents 
a central state commission from making an order in violation 
of the terms of such franchise. This question was discussed at 
some length in City of Ashland v, Ashland Water Company, 
supra, in which the Commission took the position that in the Con- 
stitution the state has reserved the right to amend, alter or re- 
peal any franchise granted by the state or by any municipality ; 
that neither the common council of a municipal corporation nor 
the legislature had the power, after the adoption of the state 
constitution in 1848. to grant either by special or general act any 
franchise which could not be altered, amended or repealed by 
the legislature; that the legislature, in granting a public utility 
the right to surrender its franchise and receive in lieu thereof 
an indeterminate permit, did not thereby make it optional with 
the utility whether it would subject itself to the regulatory pow- 
ers of the Commission or not. 

We realize the gravity of the legal and constitutional questions 
involved in this position. In case either party dissents from the 
position which we have assumed, there is ample time for adjudi- 
cation in court before the opening of the next spring, to which 
time, no doubt, much of the work of installing meters will have 
to be postponed. We fully realize that the points in controversy 
are for the courts to decide; but in order to arrive at a con- 
clusbn in this case and to present the issues raised by the fran- 
chise squarely, we will not hesitate to make an order apparently 
in vnolation of the terms of the franchise. 

An order will be entered requiring the installation of meters ; 
and after sufficient data of water consumption on a meter basis 



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96 RAILROAD COMMISSION OP WISCONSIN. 

have acciimulatcd, tlic Commission will make a supplementary 
order prescribing meter rates. 

It is Therefore Ordered, That before Aug, 1, 1911, the 
Washburn Water Works Company install meters for measuring 
the water consumed by each and all of its customers, except 
such as may be exempted, after due hearing, on application to 
this Commission. 



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In re apfleton water works oo. 97 



IN RE DBTERMININO AND FIXING A JUST COMPENSATION TO 
BE PAID TO THE APPLBTON WATER WORKS COMPANY BY 
THE CITY OF APPLBTON FOR THE TAKING OF THE PROP- 
ERTY OF SAID COMPANY. ACTUALLY USED AND USEFUL 
FOR THE CONVENIENCE OF THE PUBLIC. IN ACCORDANCE 
WITH THE PROVISIONS OF CHAPTER 49» OF THE LAWS OF 
1907 AND ACTS AMENDATORY THEREOF AND SUPPLEMENT- 
ARY THERETO. 



Suhmitted Oct, t4, 1910. Decided Dee, 7, 1910. 

Petition to fix compensation to be paid for the property of the Apple- 
ton Water Works Company, such company operating under an 
indeterminate permit. An official valuation was made by the 
engineers of the Commission on two bases, one on the average 
price of labor and materials during the preceding five years, 
and another on current prices. Such valuations are found to 
be. under the first method, cost new, |298.512; present value. 
$258,281. Under the second method, cost new. $282,091; pres- 
ent value. $242,127. Other valuations made by experts em- 
ployed by the interested parties are also considered. 

Held: (1) That no value should attach to the indeterminate permit 
held by the company; that an indeterminate permit possesses 
no more value than a franchise for a definite term of years 
upon the expiration of the term; that the statute eliminates 
franchise values when a municipality elects to purchase the 
property of a utility operating under an indeterminate per- 
mit; that an indeterminate permit is terminable at the will 
of the municipality; that the municipality does not acquire 
the indeterminate permit but terminates it when it deter- 
mines to purchase the property. 

(2) That "going value" Is an tesential element in determining the 

value of a public utility. In this case the fact that the plant 
is incapable of rendering reasonably adequate service, that it 
will require a large expenditure of money to place the plant 
in a reasonably adequate and eflicient operating condition, 
that the operating revenues are insufficient to meet the neces- 
sary operating expenses, including maintenance and deprecia- 
tion, are considered in fixing the going value. 

(3) That while for rate-making purposes the estimated cost of laying 

mains and services in streets which are now paved but which 
were not paved at the time such mains and services were laid 
need not necessarily be considered, in determining the repro- 
duction value or the value in this proceeding such estimated 
cost should be considered. 

(4) That the just compensation to be paid for the property of the 

company actually used and useful for the convenience of the 
public is $255,000, such sum to be paid on or before July 1. 
1911. 

The city of Appleton served on the Appleton Water Works 
Company, J. .\. Hawes as receiver of the Appleton Water Works 
7— R. D. 



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98 RAILROAD COMMISSION OF WISCONSIN. 

Company, and the Railroad Commission of Wisconsin, a notice 
setting f(»rtli that the city of Appleton is a duly organized and 
existing city of Ihc state of Wisconsin ; that the Appleton Water 
Works Company is, and at all the times herein mentioned was, 
a corporation organized and existing under the laws of the state 
of Wisconsin, and was and is a public utility engaged in trans- 
mitting, furnishing, and delivering water for public use in said 
city; that on or about Oct. 31, 1907, said water works company 
filed with the Railroad Commission of Wisconsin, and with the 
city clerk of the city of Appleton, a written declaration duly and 
regularly executed, as provided in ch. 499, Laws of 1907, sur- 
rendering all franchises, licenses or permits granted to it by said 
city, and thereby became entitled to receive by operation of law 
an indeterminate permit, as defined in said ch. 499 ; that on Jan. 
31, 1908, in a suit in the circuit court of the United States for the 
Eastern district of Wisconsin, wherein the American Trust Com- 
pany and the Continental Securities Company are complainants 
and the said water works company is defendant, the said J. A. 
Hawes was appointed receiver of all the property of the said 
water works company, and is now such receiver; that at an ad- 
journed regular meeting of the common council of the said city 
of Appleton, held in the said city on July 20, 1910, a resolution 
was duly adopted sulmiitting to a vote of the electors of said 
city, for determination at a special election to be held in said 
city, in the manner prescribed by law, on Tuesday, Aug. 23, 
1910, the question of the acquisition and purchase, pursuant to 
said ch. 499 as amended, of the plant and equipment of the Ap- 
pleton Water Works Company, for the just compensation and 
upon the terms and conditions which shall be fixed, determined 
and certified by the Railroad Commission of Wisconsin, as pro- 
vided by said ch. 499 as amended; that pursuant to law and to 
such resolution due and suflioient notice of such special election 
was given, posted and published ; that said eleotion was duly held 
on said Aug. 23, 1910, and the vote of the electors of said city, 
voting on the question so submitted, was as follows, to-wit: 
Total number of votes cast, 1,279 — of which 1,207 were in favor 
of such purchase, 70 opposed, and 2 blanks ; that within one week 
after such election, to-wit, on Aug. 25, 1910, the common council 
of said city duly met and canvassed the returns of said election, 
and declared the result as aforesaid; that said municipality has 
determined to acquire said existing plant in the manner pre- 



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In re appleton water works go. 99 

scrilxid in sec. 1797m — 80 of the Wisconsin Statutes, as amended, 
and the said public utih'ty owning such plant has consented to the 
taking over of such plant by said municipality by acceptance of 
an indeterminate permit, as provided in and by the Public Utili- 
ties Law of this state, to-wit, sees. 1797m — 1 to 1797m — 109, Wis- 
consin Statutes, as amended. 

Upon receipt of the foregoing notice, due notice was given to 
the city of Appleton, the Appleton Water Works Company, and 
J. A. Hawes as receiver of the Appleton Water Works Company, 
that on Oct. 24, 1910, at nine o'clock in tlie forenoon of that day, 
at the office of the Railroad Commission of Wisconsin in the 
capitol in the city of Madison, the said Commission would proceed 
to hold a public hearing on the valuation of the plant of the Ap- 
pleton Water Works Company, and following such hearing woulfl, 
by order, fix and determine the compensation to be paid by the 
city of Appleton for the property of the Appleton Water Works 
Company, actually used and useful for the convenience of the 
public, and the terms and conditions of such sale and purchase. 

The matter came on for hearing at the time fixed as aforesaid. 
The city of Appleton appeared by Greene, Fairchild, North & 
Parker, its counsel. The Appleton Water Works C<Mnpany ap- 
peared by Lines, Spooner, Ellis & Quarles, its attorneys, and /. 
A, Hawes, as receiver of the Appleton Water Works Company, 
appeared in person. 

By agreement of the parties, the record of the proceedings had 
in City of Appleton v, Appleton Water Works Co. 5 W. R. C. R. 
215, including all the testimony, exhibits, and matters considered 
by the Commission in reaching a decision, were made a part of 
the proceedings in this matter. Some further testimony was 
offered relative to additions and extensions made to the plant 
under consideration since the decision was rendered in the for- 
mer case. As the testimony was fully considered and reviewed 
in such case, it becomes unnecessary to again consider it in detail. 
The results of the various valuations of the physical property 
made at that time by the different engineers, is reproduced in the 
following table : 



Digitized by VjOOQIC 



100 



RAILBOAO 00HMI8SI0N OF WISCONSIN. 



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Digitized by VjOOQIC 



In re appleton water works oo. 



101 



At the conclusion of the hearing in the former matter the en- 
gineers of the Commission revised their tentative valuation, as 
shown in the preceeding table, in the light of all the evidence and 
facts presented upon the hearing. The result of such revision 
was adopted by the Commission for the purposes then under con- 
sideration, and is set forth in the following table: 



Group. 


Classiflcatlon. 


Oost of re- 
production. 


Present 
value. 


1 


Land 


U,980 

1«5,054 

2S,671 
»,0i5 


|B>1^ 


2 


WeDfl, intakeB and Buctions.... 


TA,m 


8 


Beservoir , , 


12,271 


4 


Distribution sygtem ,/. , '. 


160,221 


6 


Power plant equipment 


10.6E8 


6 


Bnlldloff B and nilBceUaneouB Btmctuies 


.20,849 


7 


Office furniture and appliances 


87 


8 


Tools , , 


815 


9 


Horscfl. wagons and mlscf^llaneons. ..................... 






Total. Items 1—9 








$Me,«7 
»,Ofle 


1218,582 
28,024 


10 


Add 12 per cent (see note below) 




Total Items, 1—10 






|e71,SS6 


1288,156 


la 


Stores and supplies. 


2,699 




Total, Items 1—11 






817 


8241.815 


12 


Paying 


im 




Total, items 1—12 






|e74.«i 

4.138 


$242,402 
211 


18 


Kon-operatInK property 




Total, items 1—18 






1^,901 


9242,018 







Notb:— Addition of 12 per cent to cover emrlneering, supervision, interest durlnsr 
constmction, contingencies, etc. 

The following statement drawn from the books of the company 
shows expenditures made in extensions and improvements since 
the date of the original inventory, which was used by the en- 
gineers in making their valuation for the purposes of the former 
proceedings : 

Items Pubchased and Deutebed Pbxvious to Date of Original In- 
VENTOBY, May 26, 1908. 

W. I. mains and services (April, 1908) |123 88 

W. I. mains and services (May 1 to 26, 1908) 297 89 

C. I. mains (May 1 to 26, 1908) 44 33 

Office safe (purchased Feb. 13, 1908) 110 00 



Items Pcbchased Since Mat 26, 1908. 



$576 10 



C. I. mains $3,837 60 

W. I. mains and services 2,094 45 

Water power flume 241 61 

Boiler and accessories, etc 3,055 19 

Buildings and miscellaneous structures 208 81 

Tool stores and supplies 75 53 

Miscellaneous (dressing tools, awning, hose, etc.) 91 31 

Unknown purposes ^ 37 20 



Forward 9,717 80 



Digitized by VjOOQIC 



102 RAILROAD COMMISSION OF WISCONSIN. 



Brought forward $^,717 80 

PosrioJNS TO BE Deducted. 

Items previous to May 26, 1908 $576 10 

Tool stores and supplies 75 53 

Miscellaneous 91 31 

Unknown purposes 37 2U 780 14 

Net total $8,937 66 

At our request the engineers of the Commission have revised 
and brought their valuations down to date. The additions made 
since the former valuations are thus included, and the deprecia- 
tion incurred in the meantime deducted. The valuation is esti- 
mated on different bases, one on the average prices of labor and 
material during the preceeding 5 years, and the other on the cur- 
rent prices of labor and material. They have also included non- 
operating property, or property which is neither used nor useful 
for the ccMivenience of the public in the operation of the plant. 

REPORT OF ENGINEERS OF COMMISSION. 

In the following statement reference will be made to three 
tentative valuation reports relating to the physical property of 
the Appleton Water Works Company, prepared by the engineer- 
ing staff under instructions from the Railroad Commission, viz: 

(1) Valuation A, as of the original inventory date. May 26, 
1908, with unit prices established with reference to the "normal" 
or '^five-year average" basis, which basis was fully described in 
the case of the City of Appleton v. Appleton Water Works Co. 
5 W. R. C. R., 215. 

(2) Valuation B, as of the later inventory date, Nov. 1, 
1910, with the unit costs also on the "normal price* basis abo\'C 
mentioned. 

(3) Valuation C, as of the same inventory date, Nov. 1, 
1910, used in valuation B, but with unit prices based on the 
"current price'* standard, as nearly as may be with reference 
to the particular date of the inventory (prices prevailing at the 
date of the inventory, Nov. 1, 1910). 

Valuations B and C were prepared by the following process : 
(1) Correction of any discrepan-cies found in the inventory of the 
original tentative valuation (valuation A). (2) Revisions due 
to additions to the physical property between the eai'licr and later 
inventory dates. (3) Revisions due to deductions or replace- 
ments during the same period. (4) Revisions in the valuation 
figures due to the revision of the unit prices to a later five-year 
period, and the application of unit prices determined on two 
different bases, as above indicated in defining valuations B and C 
(5) Determination of depreciation down to the new inventory 
date. 



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In re appleton wateb works go. 103 

The foregoing steps were safeguarded at every point; the field 
investigations, me examination ot exiiibits and recoras ot hear- 
ings, the analysis of local conditions, studies of unit prices and of 
actual costs were avauable, ottice compilations ana calculations, 
estimates of depreciation, etc., were made with the usual care, 
and the final results subjected to critical review to insure consist- 
ent and trustworthy valuation figures. 

The more important steps involved in deriving the figures given 
in valuations B and C are indicated in the following memoranda: 

Land. By reason of the supposed natural growth in land val- 
ues, it was aeenied advisable to make an entiieiy independent in- 
vestigation with reference to the value of lands owned by the 
company. This investigation was made by a member of the 
staff engaged extensively in land valuations throughout the state 
lor the purposes ot the railroad and tax commissions. 1 nis later 
valuation is based partly on additional data not available in the 
original investigation, and hnal figures are regarded as especially 
trustworthy. 

Wells, intakes and suctions. The changes in this group are due 
to the change in unit prices on cast iron pipe, stated below in the 
memorandum relating to the "Distribution system." 

Reservoirs. The change in the valuation of the storage reser- 
voir results from a change in the. unit price for earthwork, which 
was increased from 35 to 40 cts. per cubic yard. 

Distribution system. The changes under the distribution sys- 
tem arise through changes both in unit prices and in quantities. 
In the original valuation A, the prices of cast iron pipe were 
based on the average of the quotations (f. o. b. Chicago) pub- 
lished in the "Iron Age" during the five years ending with June, 
1907, plus freight from Chicago to Appleton of $2.50 per ton, 
plus cartage at oO cts. per ton irom cars to street. In valuation 
B, the unit prices on cast iron pipe were based on the average of 
the **Iron Age" quotation, f. o. b. Chicago, during the five year 
period ending with June, 1910, plus the difference between the 
through rate from foundries to A.ppleton and the rate from 
foundries to Chicago, namely, $1.55 per ton; thus putting the 
adopted unit prices on the basis of through freight rates. In 
valuation C, the unit prices applied to cast iron pipe were based 
on market prices prevailing Nov. 1, 1910, according to infomia- 
tion obtained from various trustworthy sources, and modified to 
apply to Appleton delivery by the inclusion of the proper freight 
charges, on the basis of through freight rates. 

The price on all items was changed from price delivered on 
street to the price delivered f . o. b. Appleton, to conform to com- 
mon practice. Price on cast iron specials was changed from 
3 cts. to 2% cts. per lb. plus freight difference of $1.55, already 
explained. Cartage made a separate item and placed at 40 cts. 
instead of 50 cts. per ton as previously. The tonnage of the 4", 



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104 RAILBOAD G0MHIS8ION OF WISOONBEN. 

6" and 8" cast iron pipe, and the cast iron specials was changed 
by the addition of 43 ft. of 4'' pipe, 2,077 ft. of 6" pipe and 234 
ft. of 8" pipe, with 0.928 tons of specials, due to extensions; 
by the deduction of 634 ft. of 8" pipe (due to the removal of 
434 ft. and abandonment of 200 ft. more) ; and by tiie deduction 
of 33 ft. of 10'\ 120 ft. of 8" and 900 ft. of 6" cast iron pipe, in- 
cluded previously in the inventory and valuation (valuaticm A) 
as pipe used for valve boxes. The number of valves was 
changed by the addition due to extensions since date of the 
orininal inventory, viz : One 4" valve, eight 6" valves, and one 
8" valve. The price on valves was changed to delivery f. o. b. 
Appleton instead of on street. In the matter of valve boxes 
change has been made from the previous valuation on the basis 
of the use of the ordinary form of valve box instead of the 
more costly makeshift boxes used by the company. The length 
of trenching and laying 4", 6" and 8" cast iron pipe has been 
changed to correspond to the additions and deductions since 
date of original inventory. Trenching and pipe laying prices 
have been slightly changed, due to us^ng 40 cts. instead ot 35 ctb. 
for excavation and back-filling in the upper or dry district of 
the city. Allowance is made for five additional hydrants, added 
since date of previous inventory, with modifications due to 
change in basis of freight aqd cartage. The length of 2", 
1-14" and 1" wrought iron mains increased by extensions since 
date of original inventory by 2,181 ft. 2", 365 ft. V/^', and 428 
ft. of 1" pipe. A length of 1,789 lin. ft. of 2" wrought iron 
pipe in previous valuation has been deducted, as same has been 
replaced by a 6" cast iron pipe extension. 

The status of this last named length of 2" wrought iron pipe 
has received special consideration by the staff. Investigation 
shows that this pipe is now disconnected from the system and 
that it is not likely again to be used. 

Pumping plant equipment. A 60 inch by 16 ft. fire tube 
boiler, 26 years old at the inventory date of valuation A (1908), 
and estimated at minimum service value in that valuation, was re- 
moved by the company in 1909 and a new 72 inch by 18 ft fire 
tube boiler was installed instead of the displaced boiler, increas- 
ing the reproduction cost $581 and the present value $1,478 in 
vsduations B and C over the figures in valuation A. AH live 
steam piping was replaced with heavier pipe in 1909, increasing 
the reproduction cost $388 and the present value $397 in valua 
tion I> as compared with valuation A. The corresponding in- 
crease in valuation C over A, due to the pipe renewals, was 
$291 on the reproduction new and $322 on the present value. 
The 9 by 12 inch Knowles duplex geared well pump, which was 
classed as operating property in valuation A, is included under 
the non-operating group in valuation B and C, and the present 
value changed in the two later valuations from $100 to $236, in 



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In re applbton water works oo. 105 

order to bring it to the usual ininimum service value. In gen- 
eral, as a result of this investigation, the unit prices on the larger 
power plant equipment, such as pumps, water wheels, etc., is 
unchanged in valuations B and C. 

Miscellaneous, The value of items included under "Tools, 
implements and machinery", is increased in valuation B and C 
$154 in reproduction cost and $60 in present value, due^ to 
change of inventory. Likewise the ^'Stores and supplies" 
(stock) item was increased in the later valuation $1,625 in re- 
production cost and present value. 

Paving, At the date of the original valuation (May 26, 
1908). most of the paving which existed then over mains and 
services was cedar block and an inferior grade of macadam. 
All of the block paving was at that time 12 to 15 years old, and 
almost completely worn out. Such paving was therefore re- 
^^arded as adding no element of value to the plant in the 
original valuation. 

Valuation A, (as revised May 12, 1910) contained allowance 
for all and only that paving believed to have been disturbed and 
replaced by the company in the course of its work of actually 
laying pipes under paved streets. The estimates for paving in 
valusutions B and C are based upon the lengths of the several 
kinds of paving over mains as determined by the water company 
from a pavement list which was verified by the city engineer. 
The company also prepared and submitted a statement of paving 
now over those services which were laid since 1908 ; but on ac- 
count of the company's recent practice of requiring patrons to 
pay for excavation and refilling of service trenches (and for 
the service pipe as well), no allowance was deemed proper on 
paving over services and no such element is included in tiie 
valuations herewith submitted. Although definite figures are 
lacking as to the possible number of services which actually in- 
volved the removal of paving by the company, it may be stated 
that this item would probably not in any event exceed $150. 

The entire amount of paving now over services does not ap- 
pear to be capable of determination with certainty from the data 
at hand, although the following amounts are believed to be fairly 
accurate. 



Klad 



(keoioted wood block.. 
AiNiAlt 



;} 



Total length 



]B,ooon. 



Oott to take up 

paTtnft and 

replace 



17,000.00 



In connection with the question of an element of value of 
the plant in paving over services, it is to be explained that in 
most cases of laying services under streets paved with stone, 



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106 



RAn.ROAD COMMISSION OP WISCONSIN. 



block, brick, asphalt, or creosoted wood block, — all on concrete 
base, — It would rarely be necessary io tear up the pavement over 
the whole length of service trench. There would likely be 
considerably less than half of it disturbed, owing to the common 
use of the methods of tunneling and forcing pipes through 
several feet of earth by pipe-forcing jacks. 

Conclusion. Attention is called to the general tendency of 
unit prices of some materials used by the staff in making valua- 
tions of physical property. Confidential discounts are fre- 
quently given to buyers, of which the appraiser finds it difficult 
to obtain definite information or to take into consideration in 
making valuations. Moreover, trade journal quotations, such 
as are used as a guide in certain of the unit prices employed by the 
staff, are known to average somewhat above actual selling prices. 
It should also be noted that the allowance for engineering and 
superintendence is made in the valuations for the entire pro- 
perty, notwithstanding the fact that more than half of the mile- 
age of mains and other important features of the property were 
constructed after the original plant was completed and put in 
operation, the expense of which supervision was met as- an 
operating expense. On the other hand, there is always a ten- 
dency toward omission in the preparation of inventories, which 
tendency, however, the contingency item is intended to cover. 
Considered as a whole, the net result of such tendencies is to 
more than cover these elements of value in the tangible property. 



VALUATION OP 



PHYSICAL PROPERTY OP THE APPLETON WATER 
WORKS COMPANY. 

FiNAT. SUMVART. 



Classification. 



1. Land , 

2. Wells, intakes and suctions 

3. Reservoirs 

4. Distribution system 

5. Pumpintf plant equipment 

0. Bulkiintrs and miscellaneous structures., 

7. Office furniture and appliances 

8. Tools, implements and machinery 

9. Horses, watrons and miscellaneous 



Total. Items 1-9. 
10. Add. 12%* 



.Total. Items 1-10. 

11. Stores and supplies.. 

Total, items 1-11. 

12. Pavlntr 



Total, items 1-12 

13. Non-operatinif proixM-ty. 



Total, items 1-1.3.. 



Rased on 5-yr. A v. 
prices. 



Cost 
new. 



$7,000 

li.Ote 

13,203 

153.841 

26.476 

28.&4i) 

125 

542 



$243,801 
29.256 

I2r3,(k-)f 
2.724 



!?275.781 
18,805 



|2iU.586 
3,926 



S298.512 



Pres. 
val. 



87.000 

13.708 

12,939 

145.622 

11,840 

20.649 

81 

271 



1212.116 
25.454 



$237,570 
2,598 



$240. 168 
17.865 



$2.^.033 I 
248 



Hased on Pres. 
prices. 



Cost 
new. 



$7,000 
12,962 
13.203 
139.610 
26.565 
29,142 
125 
542 



$229,139 
27.497 



$256,636 
2,724 



$2.59.31)0 
18.806 



$278,165 
.3.926 



Pres. 
val. 



r.ooo 

12.673 
12,939 
131,886 
11.817 
21.076 
81 



$.97.f93 
23,723 



$221,416 
2.598 



$224,014 
$17,866 

$241^ 
248 



$258,281 I $.'82,091 i $242,127 



etc. 



* For enffinefring and supcrinteadcncc, Interest during coDstructloQ, coqtingepcles, 



Digitized by VjOOQIC 



In re appleton water works co. 



107 






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In re appleton water works oo. 



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In re appleton water works co. 



117 




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118 RAILROAD COMMISSION OP WISCONSIN. 



Franchise Values. 

The contention is made on the part of the company that in de- 
termining the just compensation to be paid to it for the water 
works, the value of the indeterminate permit under which it has 
been operating must be taken into account. If this construc- 
tion is correct, the Commission evidently erred in its decision in 
the Cashton case, 3 W. R .C. R. 67, where the question was raised 
and argued by counsel. After a careful consideration of the 
subject in that case, the Commission said (pp. 83, 84) : 

"The company claims compensation for the license or privilege 
by virtue of which it is authorized to carry on its business. It 
surrendered its franchise some time ago, and received in lieu 
thereof an 'indeterminate permit', which is defined in the statute 
as meaning and embracing 'every grant, directly or indirectly 
from the state, to any corporation, * * * of power, right or 
privilege to own, operate, manage or control any plant ♦ ♦ ♦ 
within this state for the production, transmission, delivery or 
furnishing of heat, light, water or power, either directly or indi- 
rectly, to or for the public, which shall continue in force until such 
time as the municipality shall exercise its option to purchase, ^^ 
provided in, this act * * *' (Sec. 1797m 1, 5). Obviously, 
the term of the indeterminate permit is indefinite and limited 
only by the happening of the event specified in the statute. The 
moment the municipality exercises its option to purchase the plant 
of a public utility operating under an indeterminate permit, the 
life of such permit is terminated, and henceforth the same pos- 
sesses no more value than a franchise for a definite term of 
years upon the expiration of the term. It is manifestly the pur- 
pose of the law to relieve a municipality of any and all obliga- 
tion to make compensation for the privilege of doing business, 
granted to a public utility, when the municipality determines to 
acquire the property of such public utility. As the company's 
privilege of continuing in business has expired, no compensation 
can be awarded for a right that no longer exists." 

If the purpose of those who framed the statute under consider- 
ation, and of the legislature which enacted it is to control in its 
construction, the conclusion reached in the Cashton case is incon- 
trovertible. It is well known that one of the primary consider- 
ations which led to the adoption of the provision respecting the 
surrender of the franchises, was the elimination of franchise 
values whenever a municipality elected to acquire the property 
of a public utility operating within its borders. As an induce- 
ment to such surrender, the right to operate until the municipality 



Digitized by VjOOQIC 



In re appleton water works oo. 119 

should determine to acquire the property of the utility, protec- 
tion from competition, either by the municipality itself or by 
a public service corporation, and security against almost total 
loss of the investment, which would inevitaibly result from scrap- 
ping the plant upon the expiration of the franchise, were made 
available to public utilities by means of the privilege denominated 
in the statute "an indeterminate permit." By making a surrender 
of its franchise and accepting in lieu thereof an indetemiinate 
permit, a public utility acquires, in effect, a legally protected mon- 
opoly and the right to continue its public service indefinitely. Such 
monopoly can not be destroyed except it be established that public 
convenience and necessity requires a second public utility to en- 
gage in the same business in the municipality. By extending its 
plant to meet the public exigencies as they arise, and by discharg- 
ing its public functions properly, a public service corporation 
may maintain its monopoly of the business as long as it continues 
operation. Neither can its enjoyment of such monopoly nor its 
right to remain in the public service be terminated by the munic- 
ipality, except upon payment to it of "just compensation" for all 
its "property actually used and useful for the convenience of the 
public." As a consideration for the valuable privileges thus guar- 
anteed, the law provides that the term of the license or franchise 
authorizing the maintenance and operation of the plant be de- 
terminable at the will of the municipality. Certainly no legisla- 
tive body would have provided for the municipal ownership of 
the existing public utility plants operating under indeterminate 
permits, in the manner prescribed in the statute, if the value of 
property had been enhanced because of the indeterminate permit 
proviso conferring upon the corporations a practically perpetual 
and exclusive franchise. The municipality does not acquire the 
indeterminate permit, but terminates it when it determines to pur- 
chase the property. The sale of its property by the public utility 
to the municipality and the extinction of the indeterminate per- 
mit are voluntary acts on its part. For the municipality to thus 
acquire the property upon the terms of the statute does not con- 
stitute a taking of private property for a public purpose against 
the will of the owner, for, upon surrendering its franchise and 
accepting, in lieu thereof, an indeterminate permit, the utility 
gives its consent to the sale and the terms thereof as prescribed 
in the statute. Therefore, in determining the just compensa- 
tion that the municipality must pay for the property acquired, 



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120 RAILROAD COMMISSION OF WISCONSIN. 

the expired permit or license, by virtue of which the property was 
maintained and operated by the utility, is not an element of value 
entering into the calculation. Any other conclusion would, in 
our judgement, not only do violence to the letter and spirit of 
the statute, but also to the clear intention of the legislature which 
enacted it. 

Going Value. 

That "going value" is an essential element in determining the 
value of a public utility, is no longer an open question. Omaha 
V. Omafia Water Co. 30 Sup. Ct. Rep. 615-620; Kmnebcc Water 
Dist, V. City of Waterville, 97 Me. 185 ; Brunswick, etc., fVater 
Dist. V, Mcine Water Co, 99 Me. 371 ; National Water Works Co. 
V. Kansas City, 62 Fed. 853, 864 ; Narwich Gas & Electric Co. v. 
Norwich, 76 Conn. 565 ; Galena Water Co. v. Galena, 87 Pac. 735 ; 
Newburyport Water Co. v. Newburyport, 168 Mass. 541 ; Glou- 
cester Water Supply Co. v. Gloucester, 179 Mass. 365; Spring 
Valley Water Works v. San Francisco, 124 Fed. 574, 594 ; C. H. 
Venner Co. v. Urbana Water Works, 174 Fed. 348—352 ; Mis- 
sowH K. & T. R. Co. V. Love, 177 Fed. 493. 

Engineers have endeavored to measure the element of "going 
value" in various ways, all of which tend to enlighten the judg- 
ment, although none of the methods employed are conclusive. In 
re Cashton Light & Power Co. 3 W. R. C. R. 67, 84-95. 

That "going value" is not a mere unearned increment in every 
instance, as is sometimes asserted, is obvious from the discus- 
sion contained in the cases cited in Appleton v. Appleton Water 
Works, 5 W. R. C. R. 215, 276, as well as In re Cashton Light 
& Power Co., supra. 

It has been the aim of the Commission in all rate-making cases 
to ascertain, as far as possible, the unrequited expenditures in- 
curred in establishing the business of a public utility upon a 
basis where operating revenue became adequate to meet all the 
legitimate demands of the utility. This seems to be the most 
equitable method of ascertaining the enhancement of value that 
should be given to the physical structure as a going concern, 
when returns upon the reasonable investment is the object of the 
inquiry. We have never, however, deemed this method exclu- 
sive, but the results thereby obtained in certain cases, when con- 
sidered in connection with the estimates of engineers made upon 
other bases, seemed to us more equitable, and therefore were con- 



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In re APt>LEfoK wAtte WoftKS Co. l2l 

trolling in the conclusions reached in those cases. The principle 
thus applied seems to find support in the language of the court in 
Missouri, K. & T, Ry. Co, v. Love, supra, where it is stated: 

"An established railroad system may be worth more than its 
original cost and more than the mere cost of its physical repro- 
duction. It has passed the initial period of little or no return 
to its owners which, of greater or less duration, almost always 
follows construction and is not infrequently marked by default 
and bankruptcy. The inevitable errors in its building which 
finite minds and hands can not avoid, have been measurably cor- 
rected, time and effort have produced a -commercial adjustment 
between it and the country it was intended to serve, relations 
have been established with patrons, and sources of traffic have 
been opened up and made tributary. In other words, the rail- 
road, unlike one newly constructed, is fully equipped and is do- 
ing business as a going concern. It has attained a position after 
many experiences common to railroad enterprises which entail 
loss and costs not paid from current earnings, and which corre- 
spondingly make for value." (Pp. 496, 497.) 

We accept the results attained by any of the methods employed 
to ascertain the extent of the going value of any public utility, 
but we accept such results only as evidences of value and not as 
conclusive. They are all taken into consideration in connection 
with all the facts and circumstances surrounding the particular 
plant under appraisement. In the instant case, that the plant is 
incapable of rendering reasonably adequate service to the public; 
that it will require an expenditure of a large sum of money, as 
conceded by all the engineers who testified upon the hearing, to 
place the plant in a reasonably adequate and efficient operating 
condition; and that, although the plant has been in operation 
for upwards of twenty years, the operating revenues are insuffi- 
cient to meet the necessary operating expenses, including main- 
tenance and depreciation, are important factors that can not 
be excluded from consideration in determining the fair value of 
the plant as a going concern. 

It must be conceded that "going value," however computed, 
can not be made the means of fictitiously increasing values or 
creating values that do not, in fact, exist. 

Paving. 

It is contended on the part of the company that the Commis- 
sion erred in disallowing the estimated cost of laying mains 
and services in streets which are now paved, but which were not 



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122 RAILROAD COMMISSION OF WISCONSIN. 

paved at the time such mains and services were laid. Appleton 
t'. .ippicton h atcr h oras co. o \\. K. C. K. Zlb, zib. 

It was nut tiiii nitention m such consiaeration ot tnc subject to 
deny tliat the cost ol reproducing the plant new, under tlie exist- 
ing conditions, should inciuac sucii estimate cost, Due tiie inquiry 
was there directed more particularly to ascertaining the cost of 
reproducing the plant new in the manner of its actual construc- 
tion. As was said in Ashland v, Ashland Water Co, 4 W. R. 
C R. 2/3, 307, and approved in the Appleton case cited: **vvhiie 
this item is unquestionably a valid one in estimating the cost of 
reproduction new, it is not an item which, on its tace, must be in- 
cluded in the value of the property for rate-making purposes." 
For the purpose of the present inquiry it is conceded that the 
cost of reproduction new, including the item of paving, must be 
regarded as an evidenciary fact in reaching a final conclusion, 
and it may be added that in no case, either lor rate-making pur- 
poses or otherwise, has the Commission ever omitted from con- 
sideration the item of paving in ascertaining the cost of the re- 
production new. It has, however, in rate-making cases, also 
considered as having a probative effect, the cost of reproduction 
new under conditions as existing at the time of the original con- 
struction of the plant. 

The general principles that govern in determining the "just 
compensation" which the municipality must pay to the company 
for the property taken, are well established. An examination 
of several of the more important cases hereinbefore cited under 
the head of "going value" will suffice to indicate the general 
rules we have applied in reaching our conclusion. 

After a careful consideration of the different valuations men- 
tioned of the physical property of the company, actually used 
and useful for the convenience of the public, with the additions 
thereto made since May, 1908, and all the evidence and matters 
bearing upon the subject of "going value," we are of the opinion 
that the sum of two hundred and fifty-five thousand dollars 
($255,000) is just and fair compensation to the owner for the 
taking of said property by the city of Appleton. 

As there are two trust deeds and a judgment Hen on the pro- 
perty, the order herein should provide for the payment of the 
compensation to J. A. Hawcs, or his successor, as receiver of 
the Appleton Water Works Company, that the city may acquire 



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In re appleton water works co. 123 

clear title. All claimants to the fund are officially represented by 
him. If such receiver should be discharged prior to such pay- 
ment and no successor in trust should be appointed, the fund 
should be placed in the hands of the treasurer of the city of Ap- 
pleton, to hold as trustee for the lawful claimants thereto. 

Now, Therefore, it is Ordered, That the just compensation 
to be paid by the city of Appleton for the property of tlie Apple- 
ton Water Works Company, actually used and' useful for the 
convenience of the public, which is described in the foregoing 
summaries, be and the same is hereby fixed and determined at 
the sum of two hundred and fiity-fivc thousand dollars ($255,- 
000.) 

It is Further Ordered, That the city of Appleton pay 
to J. A. Hawes, as receiver of the Appleton Water Works 
CcMnpany, or his successor in trust, the said sum of two hundred 
and fifty-five thousand dollars ($255,000) on or before the first 
day of July, 1911 ; provided, however, that if an action be com- 
menced and prosecuted to alter or amend this order herein made, 
as prescribed in sec. 1797m — 83, the time within which such pay- 
ment shall be made as laforesaid be andi the same is extended 
for a j>eriod of six months after the final determination of such 
action. ; • ■ • 

It is Further Ordered, That, if at the time the said city 
shall undertake to make such payment the said receiver shall 
have been discharged and no successor in trust shall have been 
appointed, the said sum shall be held by the treasurer of the city 
of Appleton, in trust for the lawful claimants thereto. 



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124 RAILROAD COMMISSION OF WISCONSIN. 



IN RE INVESTIGATION, ON MOTION OP THE COMMISSION, OP 
THE REASONABLENESS OP THE RATES, RUIZES, REGULA- 
TIONS AND SERVICE OF THE LA CROSSE AND ONALASKA 
STREET RAILWAY COMPANY. 



Snhmitted Nov. J, 1910. Decided Dec. S, 1010. 



In this proceeding, instituted on motion of the Commission, it ap- 
peared from the testimony that the La Crosse & Onalaska St. 
Ry. Co. operated a milroad of about two miles in length be- 
tween the cities of La Crosse and Onalaska; that one car is 
operated on said line under a thirty-minute headway; that 
one man performs the duties of motorman and conductor; that 
the car in use is of an old type, unsanitary and poorly heated: 
the station facilities at Onalaska were complained of and 
numerous other complaints made as to service and rates. The 
present inquiry was directed more particularly to the equip- 
• ment in use and the absence of station faciUties at Onalaska. 

Held: That the service furnished by the La Crosse & Onalaska St. Ry. 
Co. is unreasonably Inadequate, and it is ordered that said 
company discontinue the operation of the car now in service 
and substitute therefor a car of sufficient capacity and pro- 
vided with sufficient appliances for the comfort of the passen- 
gers; that at present the necessity of station facilities at 
Onalaska is not so great that the service in that respect should 
be condemned as inadequate. 

This proceeding was instituted by the Commission on its own 
initiative for the purpose of inquiring into the reasonableness of 
the rates, rules, regulations and service of the I^ Crrssc & 
Onalaska Street Railway Company. 

The hearing was held on Nov. 1, 1910, in the city hall in the 
city of La Crosse, Wis. The city of Onalaska was represented 
by C. E. Hood, its counsel, and the La Crosse & Onalaska Street 
Railway Company was represented by Woodard & Lees, its at- 
torneys. 

It appears fn^n tlie testimony that the La Crosse & Onalaska 
Street Railway Company operates a line of railroad about two 
miles in length. It extends from the corner of Jay and Second 
streets in Onalaska to the corner of Loomis and Livingston 
streets in the city of La Crosse, where "it connects with the La 
Crosse city system. One car is operated on this line under a 



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In re investigation op ia crossb & o. sv, r. co. 125 

thirty-minute headway. The car is in charge of one man, who 
performs the duties both of motorman and conductor. In order 
to collect fares the car is slowed down and allowed to run 
without any attendant at the motor while the motorman enters 
the car and collects the fares^ On holidays and other special 
occasions a conductor is sometimes placed on the car. The sec- 
tion of the country through which this line extends between 
Onalaska and La Crosse is rather open and unprotected from 
storms and wind. The car in use is one of an old type, with 
open vestibules. The windows are not weather tight and seats 
run lengthwise of the car. Beneath the seats are large holes, 
through which cold air is admitted in winter time, and dust and 
dirt in summer time. The car is poorly heated. 

It was also shown that a large number of people living in La 
Crosse use this car daily. Some students go from La Crosse 
to the agricultural school at Onalaska, also a number of laborers 
work at the shops in North I^ Crosse, and others work at the 
shops in South La Crosse, all of whom are obliged to use this 
line of railway in going from their places of abode to their places 
of employment and return. 

There was also some complaint of the absence of shelter in 
Onalaska for passengers who were waiting to take the car for 
I^ Crosse. It was suggested that this could be obviated by ex- 
tending the line at Onalaska aroundi the block at which it now 
terminates, so as to form a loop. This would prevent in a great 
measure the necessity of standing in the open air in bad weather 
to keep watch of the car, as the same would come nearer the 
homes of those who desire to travel to La Crosse. At the pres- 
ent time, if patrons miss the car, they are obliged to wait thirty 
minutes for the car to return. 

Instances were mentioned where severe illnesses resulted to pa- 
trons because of the fact that the car was not heated, or not suffi- 
ciently heated. Students attending the agricultural school com- 
plain of the uncomfortable condition of the car in cold weather. 

It appears that a number of employes of the canning factory in 
Onalaska reside at La Crosse and complain that the rates given 
to workmen are not made available at hours when they are 
obliged to travel to reach their work, as the commutation tickets 
sold are good only between the hours of 5 and 7 in the morning 
and at the same time in the evening. Such employes are obliged, 
especially during the busy season, to remain at work until 9 or 10 
at night. The company also refused to issue tickets at reduced 



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126 RAILROAD OOMMISSION OF WISCONSIN. 

rates for students residing in La Crosse who attend the agri- 
cultural school in Onalaska. 

Upon the hearing the inquiry was directed more particularly 
tp the equipment in use and the absence of station facilities at 
Onalaska. Therefore, at this time, we have considered only the 
equipment and station facilities in controversy, leaving the 
question of fares to be determined in the case which is now pend- 
ing before the Commission, involving the entire question of rates 
of the La Crosse & Onalaska Street Railway Company. 

It can not be denied that the car in use on the line in question 
is in such condition that the comfort of passengers during in- 
clement weather is out of the question. This car has not only 
become obsolete in type, but the limit of its serviceable life has 
been reached. The public is entitled to better accommodation 
than the car in question affords. According to the report of our 
engineer, the car is no longer fit for service. The company is 
therefore not furnishing reasonably adequate service to its 
patrons on this line. 

It may be further noted that the engineers during their investi- 
gation of the service ascertained that during the winter season 
a supply of coal is put on the car at the La Crosse City Railway 
Company's car barns, which supply is intended to furnish suffi- 
cient fuel to heat the car throughout the day. The car does not 
have occasion to return to the car barn until after the day's ser- 
vice is completed, and consequently there is no opportunity of 
supplying the car with coal after the car leaves the ham in the 
morning, unless a special effort is made by the La Crosse city 
company to replenish it. It was claimed by a large number of 
patrons of the line that the company does not furnish a supply 
of coal adequate for the day's run, and many cases were men- 
tioned of certain citizens donating coal for the comfort of the 
passengers. It will be necessary in case any car is operated, to 
provide an ample amount of coal for the day's run, or to estab- 
lish a coaling station easily accessible to the car at some place 
convenient to the immediate track over which the car operates, 
before a comfortable temperature can be maintained in any car. 

Under the circumstances, we find and determine that the ser- 
vice furnished by the La Crosse & Onalaska Street Railway Com- 
pany is unreasonably inadequate, and that to render the same 
reasonably adequate it will be necessary for the company to 
place a new car in service. 



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In re investigation op la ctrosse & o. st. r. go. 127 

Respecting station facilities, it appears that the terminus of 
the line at Onalaska is near the station of the Chicago & North 
Western Railway Company, which is open at all times and avail- 
able to the patrons of the street railway. Doubtless stations 
at stopping points along the line would be a convenience to the 
traveling public who use the line in question, but the extent of 
the traffic is not sufficient to justify the investment. At present 
the necessity for station facilities at Onalaska is not so great 
that the service in that respect should be condemned as inade- 
quate. 

Now, Therefore, it is Ordered, That the La Crosse & 
Onalaska Street Railway Company cease and discontinue the 
operation of the car that it now has in service, and substitute 
therefor a car of sufficient carrying capacity and provided with 
such appliances as will render the same comfortable to passen- 
gers traveling thereon in inclement weather. 

Thirty days is deemed a reasonable time within which to com- 
ply with this order. 



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128 RAHiROAD OOHUISSION OF WlSOONSIN. 



TOWN OF HUBBARD 

vs. 
CHICAGO. ^ilLWATTKEB ft ST. PAUL RAILWAY COMPANY. 



Submitted Sep. 12, 1910. Decided Dec. IS, 1910. 

Petition alleging tliat the Pleasant street railroad crossing in the Til- 
lage of Iron Ridge, Dod^ county, is dangerous to public 
travel. 

Held: That the elimination of the danger permanently reqalres the 
separation of the grades, and a subway is ordered constructed. 
The parties interested are given an opportunity to agree on 
an apportionment of the expense of construction, and in the 
event they are unable to agree, a further hearing will be held 
on this branch of the case. 

The petitioner, the town of Hubbard, alleges that Iron 
Ridge is an unincorporated village in the town of Hbbbard, 
Dodge county, Wis., having several hundred inhabitants, several 
general stores, a hardware store, a bank, an elevator, etc. ; that 
the Chicago, Milwaukee & St. Paul Railway Company, a Wis- 
consin corporation, owns and operates a railroad running through 
the said town of Hubbard and in particular through sections 
24 and 25 of the said town of Hubbard and crossing a public 
highway between said sections 24 and 25, known as Pleasant 
street; that the said public highway runs from the village of 
Iron Ridge due west to the school house of district 10, which 
is the only public school in said village of Iron Ridge; that the 
said public highway is the only route traveled by the children 
of Iron Ridge who attend the said school, district 10, and people 
residing in the country surrounding the said village of Iron Ridge, 
who visit and are obliged to visit said village for the purpose of 
transacting business; that the said public highway is crossed 
by three tracks, two main tracks and one side track of the afore- 
mentioned Chicago, Milwaukee & St. P^ul Railway Company ; 
that upon said tracks there are run and operated over and across 
said highway a large number of railway trains, both passenger 
and freight trains; that by reason of the number of switch 
trains operating in Iron Ridge and vicinity a large amount of 
switching is done at said crossing, and trains and engines are 
moving across said Pleasant street a large portion of the time 



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TOWN OP HUBBARD V. C. M. A ST. P. B. 00. 129 

both day and night ; tliat at other times large numbers of empty 
box cars are placed along on either side of said Weasant street 
upon the side track, thus obscuring the view from passengers on 
the highway and preventing such passengers from seeing the 
approach of trains from either direction ; that the said tracks are 
raised about twelve feet from the level of the street on either 
side of the crossing, rendering it difficult for wagons with loads 
to pass over said track ; that by reason of the premises the said 
railroad crossing is a menace to public safety and to human life, 
and contrary to public convenience; that teams and persons 
traveling upon the highway, even though exercising due care and 
diligence, are in danger of being run down, killed, or seriously 
injured ; that it is particularly dangerous to school children who 
in great numbers pass and re-pass this crossing daily during the 
school year; that public safety requires an alteration in such 
crossing, its approaches and method of crossing, and the sub- 
stitution of another therefor, and requires the determination 
of the mode and manner of making such new crossing; therefore, 
petitioner prays that said respondent be compelled and required 
to make an alteration in the above crossing and in its approaches 
and to substitute another therefor, and that the determination of 
the mode and manner of making such new crossing be made. 

The respondent, answering the petition, admits all the formal 
allegations thereof, but denies that said highway crossing is a 
menace to public safety and to human life and contrary to pub- 
lic convenience, or that said crossing is particularly dangerous 
to the persons who must pass or re-pass said crossing, and 
denies that there is any reasonable necessity for the alteration of 
said crossing or the substitution of another therefor. 

The hearing was held Sep. 12, 1910, at the office of the Rail- 
road Commission in the capitol in the city of Madison, 
Lamorcaux & Husthig appearing for the petitioner and F. G. 
Weight for the respondent. 

The evidence showed that on the railroad crossir.^^ in the town 
of Hubbard, known as Pleasant street, there are three tracks, 
two main and one switch track. Trains from Oshkosh and 
Portage, bound for Milwaukee, connect at Horicon Jet. and run 
en one of these single main tracks through Iron Ridge. On the 
other main track nms the train from Fond du Lac to Iron Ridge. 
About seven miles from Iron Ridge is located the Mayville fur- 
nace, which necessitates the pfttssing of a great many freight 



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130 RAILROAD COMMISSION OP WISCONSIN. 

trains, night and day, over the crossing. The third is a switch 
track. The Pleasant street crossing is about one-eighth of a mile 
from the depot and is about sixteen feet above base level, or 
where the road begins to rise. Approaching the crossing from 
the east, the view of the trains from the south is obstructed by 
a park and the right of way slopes abruptly. The view of the 
tracks approaching the crossing from the west is obstructed by 
cars standing on the switch track. 

The highway in question is the only one leading into Iron 
Ridge from the west, and as'the village is in the extreme eastern 
part of the township, the people coming from Juneau, Hbricon 
and Hustisford must use this crossing. 

Near the crossing is a public school, which is attended by 
about one hundred children, all of whom must cross these tracks. 
Cars are constantly standing on the switch tracks, and instances 
are known where children on their way to school, delayed in 
crossing, have crawled under the cars. 

Sixty or seventy trains pass over the crossing during the day, 
and even in the stormiest weather as high as seventy teams and 
one hundred and seventy-five people passed over the crossing 
daily. 

Witnesses related a number of narrow escapes, such as the 
taking off of wheels from vehicles, the sudden approach of 
trains upon pedestrians, and serious runaways caused by fright 
to horses. Several cases were witnessed where heavily loaded 
trains approached the crossing and stopped, in some cases wait- 
ing several minutes before passing over. In a number of cases 
teams waited until advised by either train men or others that no 
trains were approaching. It would appear that the fact that 
no serious accidents have occurred is due to the extreme care 
taken by the people using the crossing. 

A separation of the grades was suggested as the best means 
of correcting the evil. A flagman and gate were also suggested. 
The cost of installing a gate was estimated at about $1,200, and 
services of a flagman per year $480. 

It is the opinion of the engineers of the Commission who made 
the investigation, that on account of the large amount of switch- 
ing done at this point it would not be practicable to install an 
automatic alarm, and that a flagman would be the only practical 
way of protecting the crossing. They were also doubtful as to 
yrjiether crossing gates WOUld be of finy practical valu^. 



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TOWN OP HUBBARD V. C. M. A ST. P. B. CO. 131 

Separation of the grades at the crossing would seem to be the 
most practical remedy. This could be done by means of a sub- 
way. Engineers have submitted estimates of the costs of such 
a subway. To carry the subway under two tracks, that is 
under the Fond du Lac line and the main line track, a cost of 
$6,765 was etimated. The estimated cost of a subway under the 
three tracks was $9,450. The question of providing proper 
drainage for a subway was brought up. From examination of 
the ground it would appear that there would be no difficulty in 
this, as there is a passage way for water underneath the tracks 
at a point about eight hundred feet north of the crossing, 
which is several feet lower than the bottom of the subway 
would be. 

While the expense of separating the grades of the highway 
and the main and side tracks of the railway company is consider- 
able, the conditions disclosed upon the investigation are such 
that no other precautionary measure is practicable or feasible. 
There is constant menace to life and property at this crossing, 
because of the frequent movement of trains over the same and 
the great amount of travel upon the highway. Wc do not be- 
lieve that gates, an electric bell, or even a flagman would be ade- 
quate to properly safeguard the public at the crossing. The 
elimination of the danger permanently requires a separation of 
the grades, and an order will be entered to that effect as soon as 
the question of the apportionment of the expense of the under- 
taking is determined. 

Upon the hearing it was suggested that in the event it was 
found necessary to carry the highway under the railroad tracks 
by means of a subway, the parties should be given an oppor- 
tunity to agree upon the portion of the expense of the work 
each should bear before the order was entered, and in case the 
parties could not agree, a further hearing should be given them 
upon this branch of the case. We accede to the desire of the 
parties in this respect, and urge as speedy action as convenient. 
The matter should be determined before the season arrives 
when the work should be commenced. 



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132 RAILROAD COMMISSION OF WISCONSIN. 



CITY OP WHITEWATER 

vs. 
WHITEWATER ELECTRIC LIGHT COMPANY. 



Submitted May 23, IDIO, Decided Dec, 16, 1910. 



Petition alleging that the respondent is not fulfilling Its contract for 
municipallighting, in that it is not furnishing arc lights of 
2000 c. p. with 432 watts at the lamps. A valuation of the 
physical property of the respondent and a division of the in- 
vestment between arcs and incandescents was made. Thirty 
per cent was apportioned to the arc or municipal lighting 
system, and 70 per cent to the incandescent or commercial 
system. The receipts and disbursements for a series of years 
are analyzed. It appears that $90 per lamp Is the lowest 
amount at which the respondent can fulfill the terms of its 
contract and secure a proper return upon the property used. 
The contract price is $80 per lamp, moonlight schedule. Tests 
made on 14 lamps showed the wattage to run from 272.2 to 
414.6. It is found that the respondent Is doing a good busi- 
ness and is on a fairly sound financial basis and able to bring 
its equipment to such an efficiency as to fulfill the terms of 
its contract and furnish the required wattage. 

The city of Whitewater, on Oct. 19, 1909, filed a complaint 
with the Commission, stating: 

**1. That a copy of the franchise of said Whitewater Electric 
Light Company and the contract between said city of White- 
water and said company is attached hereto. 

"2. That said Whitewater Electric Light Company has not in 
the past, does not, -and is not now furnishing arc electric lights 
of the standard illuminating power of 2,000 candles each with 
432 watts of electrical energy, as agreed and required by the 
terms of said contract: and that said company has not in the 
past, does not, and is not now lighting and keeping and maintain- 
ing said arc lights lightcil and illuminated to the full limit of 
said 2,000 candle power with 432 watts measured at each lamp 
as aforesaid and as required by said contract and during the 
times required by said contract. 

"3. That said Whitewater Electric Light Company has and 
does neglect and fail and refuses to furnish further incandescent 
lamps of 32 candle power as requested by said city of White- 
water and recfuired by said contract." 

The contract referred to is one entered into Aug. 9, 1900, be- 
tween the city of Whitewater and the Whitewater Electric Light 



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CITY OP WHITEWATER V. WHITEWATER EL. L. 00. 133 

Company. According to the terms of this contract, the White- 
water Electric Light Company agrees that, during a period of 
twelve years from Sep. 1, 190(), it will supply and furnish to the 
city of Whitewater forty arc electric lamps of the standard illu- 
minating^ power of 2,000 candles each with 432 watts of electrical 
energy measured at each lamp, and such number of 32 candle 
power incandescent lamps as the city of Whitewater may require, 
and all of good quality and illuminating power. In return for 
this service, the city of Whitewater agreed to pay the com|>any 
$80 per year for each arc light and $18 per year for each 32 
candle power incandescent lamp. Since the time that this con- 
tract was entered into, the rate for incandescent lamps has been 
reduced to $16 per year per lamp, which is the rate paid at pres- 
ent. These lamps, both arc and incandescent, are illuminated 
from' dusk to midnight each night, except at such times as they 
are not required according to a published moonlight schedule 
selected by the common council, but in case the moonlight is 
obscured by any cause whatever at any time when the lamps are 
not required to be lighted according to the schedule, they shall 
be lighted on demand of any officer of the city appointed by the 
council for that purpose. 

The hearing in this case was held May 23, 1910. //. O. Ham- 
ilton appeared for the petitioner and C. /. Partridge and O. B. 
Williams for the respondent. 

At the hearing it was stated by both parties that such portion 
of the complaint as related to the alleged, refusal of the respond- 
ent to furnish additional 32 candle power incandescent lamps, as 
required by the city, had arisen through a mistake as to the 
terms of the contract, and that the company admitted its liability 
to put in such lights where they are on an arc line, as the con- 
tract provides. The only matter remaining in dispute, therefore, 
relates to the character of service rendered by the company 
through the forty arc lights which it furnishes to the city. 

Mr. Hamilton, for the petitioner, testified that no experts had 
been employed at Whitewater to make tests of the lighting sys- 
tem, and that it was the intention of the petitioner to leave this 
matter to the Commission for investigation. Tliis investigation 
has been made by the engineering staff of the Commission, and 
the results are shown later in this decision. 

The greater part of the testimony oflFered at the hearing re- 
lated to the valuation of the property of the respondent as made 



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134 



RAILROAD COMMISSION OF WISCONSIN. 



by the Commission. This vahiation covered the value of the 
property on April 1, 1910, and the summary, with the division 
of investment between arcs and incandescents, is shown in table I : 



TABLK I. 

VALUATION OF PROPEUTV. 

Whitewater Electric; Light Company. 





Are-30% 


Commercial— 70% 


Total 




New 


Existing 


New 


Existing 


New 


Existing 


1. Land. (company leases 
station from St. Paul 
Railway) 














2. Distribution system 

3. Power plant equipment.. 

4. Buildings and miscella- 

neous structures 


!N,38.> 

5, a? 

1,120 

88 

287 

76 


$2,703 
4,132 

784 

64 

m 

61 


$11,177 
11,626 

2,613 

229 

618 

176 


$8,813 
9,154 

1,829 

149 

424 

U5 


$16,512 
16,843 

3,733 

327 

885 

252 


$11,516 
13.2«5 

2 eiz 


5. Office furniture and ap- 

pliances 

6. Tools, Implements and 

machinery 

7. Horses, wagons and mis- 

cellaneous 


213 
606 
£04 


Total, Items 1—7 

8. Add 12 per cent.' 


lu.iw 

1,333 


$7.1>28 

ar»i 


$26.4:{9 
3,173 


$20,512 
2,482 


$37,552 


$2K,44n 
3,41S 






Total, Items 1-8 

9. Stores and supplies 


912,446 

403 


$8,87« 

«J8 


$20,612 
»49 


$22,974 
940 


$42,058 
1,357 


$n.8-8 

l.?67 


Total, Items 1—0 

10. Non-operating property... 


$12,854 
it 


$9,287 

4 


$3J,.Vil 
22 


$23,923 
12 


$43,415 
SI 


$33.21> 
16 


Total, items 1—10 


$Vl,9i\3 


$JJ,2»l 


$30,583 


$23,935 


fi8,440 


$33,22fi 



♦ Note— .\(ldition of 12 per eent to cover eo.««t of englne<»ring, superintendence, interej^t 
during construction, contingcneie.«, etc. 

It will be noted that this valuation apportions 30 per cent of 
the plant value to the arc lighting .system and 70 per cent to the 
incandescent system. The report of the respondent for the year 
ending June )5(), 11)10, shows that one butcher shop and two gro- 
cery stores arc funiislied with power, but it a|>pcars that this 
power is supplied from the commercial lighting circuit, and in 
this valuation the property involved is classed uncier the head 
of that used for incande.^^cent lighting. As this case relates en- 
tirely to the arc lighting, no se])aration of investment need be 
carried beyond the point necessary to show the value of the arc 
lighting system. The cost new of the property of the respond- 
ent is stated as $43,446, with a present value of $33,226. The 
reports of the Whitewater Electric Light Company to the Com- 
mission state the plant investment for the year ending Dec. 31, 
1007, as $09,347.03, and the same amount for the years ending 
June 30, 1909, and June 30, 1910. During the year covered by 



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CITY OF WHITEWATER V, WHITEWATER EL. L. CO. 135 

the 1909 report, the company reports additions to the plant 
amounting to $3,068.19, and during the next year, $7,211.9L 
The company, however, has charged these additions to depre- 
ciation, and undoubtedly some of them are renewals, such as 
are contemplated when provision is made for a fund to cover 
depreciation. It appears equally certain, on the other hand, that 
part of the amounts which the company has considered as depre- 
ciation are properly extensions of the plant, such as add to its 
value. The purpose of the depreciation fund is to provide a 
source from which expenses of keeping the plant up to its orig- 
inal value may be met. It is not intended to provide for in- 
creases in plant value beyond the original investment. In other 
words, the depreciation fund is intended to provide against de- 
creases in the value of the property and to afford to owners and 
investors a means of preventing the value of their investment 
from decreasing. If the plan which the respondent has adopted 
and used during the past two years were carried out to its logical 
extreme, the books of the company would never show an increase 
in the value of the plant, no matter to what extent additions had 
been made beyond renewals necessary to retain the original in- 
vestment value of the property. That the respondent considers 
that the value of its plant has really been increased by extensions 
and additions which are included in the amounts which it has 
considered as an allowance for depreciation, is shown by its testi- 
mony at the hearing before the Commission. Respondent's rep- 
resentatives testified that the valuation of the property, made by 
the Commission, was not high enough, in that it did not include 
all of the extensions and additions to the plant and equipment 
which were being completed at the time or were in process of 
construction or installation. 

In attempting to arrive at the value of the property of the 
re^X)ndent, therefore, the value reported by the company in its 
annual reports to the Commission, that is the value as carried 
on the books of the company, cannot be accepted as accurate. 
If, however, the value reported for the calendar year 1907 be 
taken as reported, at $59,347.03, it appears that some of the 
value of construction and renewals since that date should be 
added. In the facts submitted to the Commission there is noth- 
ing to indicate how this value of $59,347.03 is arrived at, and 
consequently it can be considered, in determining the value of the 



Digitized by VjOOQIC 



136 RAILROAD COMMISSION OF WISCONSIN. 

property, only in the light of other facts, principally those of the 
Commission's valuation and the testimony oftered at the hearing. 
The testimony of Mr. Partridge and of Mr. Williams, repre- 
senting the respondent, does not attempt to sustain the reported 
plant value of $59,347.03. Their testimony related almost en- 
tirely to the valuation made by the Commission and took up in 
considerable detail what they considered to be the difference be- 
tween that valuation and the true value of the property. These 
objections are considered here in detail. 

1. Respondent maintained that the value of stores and sup- 
plies on hand April 1, 1910, the date of the valuation, was 
$2,075.04 instead of $1,357 as determined by the Commission's 
valuation. This item of $2,075 was taken from the stock sup- 
plies account of the company, and it was testified that this ac- 
count showed at all times the actual value of stores and supplies 
on hand. No itemized statement of stores and supplies was 
submitted in evidence, nor were objections entered to any details 
in the Commission's inventory value of $1,357. In view of these 
facts, it is difficult to see how a much higher value than $1,357 
can be placed on this item, although some increase may be al- 
lowed. 

2. The Commission's valuation fixed the condition of a 50 
kw. generator at 97 per cent, and assigned to it a value, on the 
date of the valuation, of $122. This generator appears to have 
been in use for several months prior to April 1, 1910, and as the 
difference claimed could not amount to more than $3 or $4, it 
may be considered negligible for purposes of determining the 
plant value. 

3. The company states that its office furniture in present con- 
dition is worth $313, instead of $213 as fixed by the Commis- 
sion's staff. No statement of the grounds for this objection is 
given, nor is any criticism made regarding the value of the fur- 
niture new, which the Commission's staff determined to be $3^7. 
Much of this furniture has doubtless been in use for a number 
of years, and the value of $313 claimed for it by the company 
seefns to be only an estimate, not based on careful investigation 
of the actual condition of the furniture. Consequently, it seems 
that the value of $213 for this item is amply sufficient and should 
be allowed to stand. 

4. There is a 14 x 36 Allis engine, .which the Commission's 
staff has rated at 25 per cent condition, giving it a present value 
of $540. This engine has been operated practically every night 

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CITY OF WHITEWATER V. WHITEWATER EL. L. CO. 137 

and the testimony showed that it had been in use for twenty- 
four years. The company claims that as this engine has been 
Jcept in good repair, it should be valued at not less than $1,040, 
which would give it a present condition not far from 50 per 
cent. The life of an engine of this type, used under the con- 
ditions existing in this instance, is usually from twenty to 
twenty-five years. As this engine has already been used twenty- 
four years, a valuation based on a present condition of 25 per 
•cent seems to be sufficiently high. The trouble with the com- 
pany's estimate seems to be a failure to appreciate the fact that, 
no matter how thoroughly apparatus is repaired, there is a con- 
siderable degree of depreciation. The mere fact that repairs 
have been made on this engine whenever the need arose, does 
not alter the effect of depreciation which will take place despite 
repairs, and which is nothing else than the loss in value and 
<!ondition which cannot be prevented by any amount of repairing. 

5. A Freeman fire tube boiler, listed by the Commission's staff 
at 69 per cent condition, is claimed by the company at a value of 
$1,200, or $200 above the Commission's staff figure. This boiler 
has been in use ten years, and $1,000, based on a present condi- 
tion of 69 per cent, seems to be as high a valuation as can be 
justified by the life which such a boiler could be expected to 
have. 

6. The company claims a present value of $1,200 on one War- 
ren 100 kw. a. c. generator, which the Commission's staff has 
listed at a value of $1,500 new, with a present condition of 54 
per cent. This has also been in use about ten years and it 
seems, from the data submitted, that no higher value than that 
stated by the Commission's staff can be allowed on this generator. 

7. This is an item of pipe and pipe covering, which the Com- 
mission's staff has valued at $976, with a present condition of 76 
per cent, It appears from the testimony of the company that 
practically all of this was installed only a few months before the 
-date of the valuation. This may justify a higher valuation for 
its present condition than that at which it has "been listed, but 
as the company does not claim a higher value new than that 
fixed by the valuation, this matter will not affect the final valua- 
tion for purposes of this case. 

The foregoing items have to do with the value of various por- 
tions of the respondent's plant in its present condition, with the 
exception of the item of stores and supplies on hand at the date 

Digitized by VjUOQIC 



138 RAILROAD COMMISSION OF WrSCONSlN. 

of the valuation, which relates to the value new. As it is a gen- 
eral rule that the reasonable return which a utility is allowed to- 
earn covers interest and depreciation on the actual investment 
in the plant, it becomes important to know what the investment- 
in the plant actually is, that is, what is the value of the plant 
new. Tlie fact that the property of the utility has diminished in 
value with use, as the inevitable result of depreciation, does not 
lessen the amount of the investment in the plant for rate-making 
purposes. To be sure, everything in the way of machinery de- 
preciates with time, due not to wear and tear alone, but to other 
natural causes, as well as to obsolescence. Rose et aL v. Burk- 
hardt Mill & El P. Co, 1910, 5 W. R. C. R. 139, 143. This de- 
terioration begins to set in as soon as the plant is ready for opera- 
tion and continues until the property becomes useless. In order,, 
therefore, to keep the original investment intact, it is necessary to- 
provide for a depreciation fund, by setting aside out of income, at 
regular intervals, an amount sufficient to cover this wear and tear. 
The amount so set aside out of incc«ne is an operating expense and. 
should be borne by the customers through the rates paid by them, 
for the services rendered by the utility. In previous decisions the- 
Commission has pointed out that when depreciation is so borne by 
consumers it should be set aside until needed for the renewal of 
worn out or useless parts of the plants. If under these conditions . 
it is not so set aside and used, but diverted to the stockholders for 
their use or personal benefit, this diversion is tantamount to the^ 
payment of dividends out of capital. It simply* means that the 
money contributed by the consumers for the upkeep of the plant 
and the investment, has been paid over to the stockholders instead 
of being devoted to the purpose for which it was properly in- 
tended. Since their investment is thus reduced, it would also 
seem that there should be corresponding reductions in the amount 
upon which the rates paid by the consumers are based. There 
would certainly seem to be instances where no other course would 
be equitable all around, unless the capital that has thus been with- 
drawn by the stockholders is restored to the depreciation fund^ 
Hill et al v. Antigo Water Co. 1909, 3 W. R. C. R. 623, 641. 

In addition to the item of stores and supplies mentioned above,, 
there are a number of items affecting the cost of the plant new,, 
which must be taken into consideration. These are as follows : 

1. The company states that the cost, in place, of a 4J/^ x 16. 
Hill deep well pump was $144.11, instead of $75 as stated in the 
valuation. r^^^^T^ 

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CITY OF WHITEWATER V. WHITEWATER EL. L. CO. 139 

2. A five inch Austin, style H, vertical steam separator cost 
$59.50 at the factory, and has been installed since the valuation 
was made. 

3. A Tirrell volt regulator, type A, was installed about two 
months after the valuation was made, at a cost of $304, exclusive 
of freight. 

4. A No. 2 Davis improved steam trap, costing $27 at the fac- 
tory, has also been installed since the valuation was made. 

5. The company claims a higher value for its meters than 
that fixed by the valuation, but the company's value is based on 
the prices specified in its contract for the current year. The 
valuation figures are based on average prices covering a period 
of five years, and as it appears that meters have been installed 
in Whitewater for a number of years, this five year average 
would seem to be the most equitable basis for determining the 
vahie of these meters new. Meters are installed in Whitewater 
as the number of consumers increases, and prices such as pre- 
vail for a single year, or those based upon an existing contract, 
cannot be as just as those based on an average for a number of 
years. 

6. The company's letter to the Commission, dated May 28.. 
1910, states that an addition, 24 ft. by 13 ft., ha.s been mfade to 
the buildings of the resi>ondent, at a cost of $250 to $300. As 
this was not include<l in the valuation, and as it is now in use, 
it appears that its value should be laididk^d to the statement of the 
cost of reproduction of the plant. 

7. There is also a private sewer 150 feet in length, with 4 inch 
vitrified tile laid from 3 feet to 3 feet 6 inches in the ground, 
which the company failed to report to the Commission at the 
time the valuation was made. The company does not state what 
value is placed on this, but it seems that $50 will easily cover the 
cost of this item. 

For the purpose of determining the cost of supplying arc light- 
ing to the city of Wliitewater, it appears that at least the fol- 
lowing additions should be made to .the statement of value of the 
Commission's staflF. 

1. Hill deep well pump $69 00 

2. Austin steam separator 60 00 

3. Davis steam trap 27 00 

4. Tirrell volt regulator 304 00 

5. Frame building 250 00 

6. Sewer 50 00 

Total additions $760 OQ 

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140 RAILROAD COMMISSION OP WISCONSIN. 

Beside these items, there is the discrepancy of $718 between 
the staff's and the company's statements of stock and supplies 
on hand at the date of the vakiation. Although the company 
has not submitted an itemized statement of this material, the 
valuation claimed, taken from the books of the company, seems 
to warrant some increase over the figures presented by the Com- 
mission's staff. Some of these increases for which allowance is 
made here have not been in use during the entire year covered by 
the 1910 report, but, on the whole, it appears that about $1,000 
should be added to the valuation made by the staff, which would 
give to the property of the respondent an average value for the 
year 1909--1910 of about $44,444. As stated above, the value 
reported to the Commission in the three annual reports of the 
Whitewater Electric Light Company is $59,347.03, but as the 
company has not attempted to sustain this valuation, and has 
agreed to a figure which is comparatively close to that reached 
by the Commission's engineering staff, it appears that the value 
of $44,444 cannot be altered because of any weight which may 
be given to the reported book value. 

As stated in the complaint filed by the city of Whitewater, the 
only matter in dispute in this case concerns the service furnished 
to the city by the Whitewater Electric Light Company through 
the arc lighting system. The matters to be determined in this 
case, therefore, are two in number: 1. To determine what the 
cost is to the respondent of furnishing arc lighting to the city 
of Whitewater. 2. To determine what the character of the arc 
lighting service should be, in the light of these costs. 

The additions to the valuation made by the Commission's staff, 
bringing the total average value of the property of the respond- 
ent, for the year ending June 30, 1910, up to $44,444, furnish a 
basis upon which to compute interest and depreciation for that 
year. The next step is the separation of the expenses of the 
respondent between output and capacity. This separation of the 
expenses for the year ending June 30, 1910, based upon a valua- 
tion of $44,444, is shown in table II: 



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CITY OP WHITEWATER V. WHITEWATER EL. L. 00. 



141 



TABLE IL 

SEPARATION OF EXPENSES 

Or THB Whitewater Eleotrio Light Company. 
I'crtr Knding Juiie 30, 1910. 





Total 


Capacity 


Output 




Pet. 


Amount 


Pet. 


Amount 


Steam power generation 


$6,390 05 

635 96 

29 22 
201 40 

206 21 
51 85 

207 55 
110 21 

25 94 

41 3S 

180 00 

705 00 
133 59 
488 26 


10 

80 

80 
80 


$687 00 

508 77 

28 38 
16112 


90 
20 

20 

20 

100 

25 

76 
100 

100 

60 


$5,733 08 


IMfltrfbution: 

Distribution sygtem operating labor 

Distribution syatem supplies and 

expense 


127 19 
6 84 


Distribution system maintenance.. 
Consumption: 
Commercial incandescent lamp re- 
newals 


40 28 
206 21 


Customers* premises expenses 

Trimming and inspection municipal 
contract lamps 


75 
25 


38 89 
5189 


12 96 
155 6fl 


Municipal contract lamp supplies.. 


UO 21 


Municipal contract incandescent 
lamp renewals 






26 01 


Maintenance of municipal contract 
lamps 


60 

100 

100 
100 
100 


20 68 

180 00 

706 00 
138 53 
498 26 


20 67 


Commercial: 
Collection expenses 




General office salaries 






General office supplies and expense. 






Miscellaneous general expense 












Total direct expenses 


$9,398 53 

1,999 96 

3,111 08 

489 28 


31.4 
31.4 
31.4 
81.4 


$2,958 52 
027 99 
976 88 
163 68 


68.6 
68.6 
68.6 
08.6 


$6,440 01 

1.87190 

2,184 20 

835 66 


Depreciation, at 4.5 per cent 

Interest, at 7 per cent 

Taxes 






Total expenses 


$14,998 87 




$4,712 02 




$10,28180 





In making the separation involved in table II, the basis upon 
which the apportionment to output and capacity has been made 
is practically the same as that used in apportioning the expenses 
of the Ripon Light & Water Company (City of Ripon v, Ripon 
Light & Water Co, 5 W. R. C. R. 1). This matter of dividing 
expenses between output and capacity cannot be covered by any 
definite rule. The division in each case must largely be gov- 
erned by the conditions prevailing in the utility under considera- 
tion. In this case, the conditions under which the respondent 
operates its plant appear to approach closely enough to those 
prevailing at Ripon to justify this separation of expenses upon 
the same basis. From this table we see that of a total expense 
of $14,993.87, for the year ending June 30, 1910, $4,712.02 fall 
under the head of capacity, and that $10,281.85 are output ex- 
penses. The further separation of these capacity and output 
expenses between arc and incandescent lighting makes it neces- 



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142 RAILROAD COMMISSION OP WISCONSIN. 

sary for us to ascertain, as closely as possible, the total amount 
of current generated and the maximum demand upon the station. 
That portion of capacity expense which arises from steam power 
generation is distributed to arc and incandescent lighting upon 
the basis of the maximum demand upon the station arising from 
each of these classes, respectively, and the output expense of 
steam power generation is divided between arc and incandescent 
lighting on the basis of tot^l current generated. This makes it 
important to know very closely the actual maximum demand and 
current generated. The reports of the respondent, with the ex- 
ception of the report for the year ending Dec. 31, 1907, do not 
make any statement of maximum demand. The report for the 
year mentioned states the maximum demand on the station to be 
120 kw., but makes no division of this demand between arc and 
incandescent lighting. A letter of the company to the Commis- 
sion, dated Oct. 24, 1910, makes a statement of maximum de- 
mand and of current generated, apportioned to arc and incan- 
descent lighting, but states that the figures given are entirely 
estimated, as the company has no means which enables it to give 
accurate information. Table III contains this statement of 
maximum demand and of current generated: 

TABLE III. 

Demand 
in kws. 

Municipal series arcs 18.4 

Municipal Incandescents 2.9 

Commercial incandescents 87 . 5 

Total maximum demand 108.8 

Current generated 
in kw. hrs. 

For municipal arcs 29, 256 

For municipal incandescents 5, 521 

For commercial incandescents 87, 508 

Total current generated » 122, 285 

As the best that the company claims for these figures is that 
they are an es^timate, it Ixx^omes necessary to check them rather 
carefully, by comparison with other available sources of infor- 
mation. The total lighting connected load on the station, re- 
ported for 1910, equals 419.76 kws. The power load in White- 
water is so small as to be negligible for purposes of these com- 
parisons. Table IV is a statement of connected load per consumer, 



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CITY OP WHITEWATER V. WHITEWATER EL. L. CO. 



143 



and of the ratio of maximum demand to connected load for 
electric utilities having f rem 200 to 500 consumers : 

TABLE IV. 



Number of 
consumers 



Connected 

load 

per consumer, 

kws. 



Ratio of de- 
mand to 
connected 
load. 



Evansville . 
Pfshtlgo ... 
Shawano ... 
Bayfield .... 
Olintonville 



Black River Palls.. 
Mineral Point .... 
Prairie du Ohien.. 

Two Rivers 

Dnrlinfirton 



Durand 

Elkhorn 

Ladysmlth 

Port Washington. 
Oconto 



New Richmond.. 

Baraboo 

New London 

Hayward 

Richland Center 



Edgerton . . 
Menomonlc . 
Hartford .. 

Elroy 

Washburn . 



Wanpun 

Sparta 

Brodhead 

Oronomowoc . . . 
Chippewa Falls 



River Falls .... 
.Stonghton .... 
Lake Geneva . 
Htargeon Bay 
Portage 



Waukesha 

Berlin 

Beedsbiirg 
Monro<^ . . . 
Hudson ... 



Rice Lake .. 
Burlington .. 
Rhinelnnder . 
Beaver Dam 
Watertown .. 

De Pere 

Kaukauna ... 

Average 

Mode 

Median 

Whitewater . 



203 
205 
210 
211 
212 

213 
213 
228 
23.'. 
239 

2« 
244 
247 
248 
273 

274 
278 
288 
288 

28U 

-296 
304 
305 

.•no 

313 



334 
387 
351 
353 

357 
361 

aofi 

372 
374 

.fro 

3,92 

404 

409 
410 
420 
440 
442 

4.50 
467 



.r4 

1.38 

.48 

1.04 

1.U8 



1.10 
l.M 

.&2 

1.05 

1.S5 

.58 

1.75 

.69 
1.04 
.85 
.45 
.45 

.74 
1 ?8 
.20 
.29 
.U 

1.40 
1.01 
.30 
1.50 
1.35 

.96 
1.00 
1.90 

.PO 
1.07 

1.12 
1.83 



1.10 
1.21 



1.38 

.^0 

1.09 

1.19 

1.08 
1.34 

1.03 

i'.Oi' 

1.06 



.53 
.75 



.54 
.30 
.54 

.62 

.64 



.87 



.83 
.80 
.75 

.26 

.96 
.75 
.48 



.46 
.47 
.37 
.48 
.44 



.21 
.46 



.18 



.41 

.24 
.42 

.56 
.45 
.48 



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144 RAILROAD COMMISSION OF WISCONSIN. 

It will be seen, by reference to table IV, that the connected 
load' per consumer is almost the same for Whitewater as for the 
average and median of the plants listed. The data for White- 
water are those reported for the year ending June 30, 1910, and 
the rest of the table is based upon the 1909 reports of the com- 
panies listed. This is not likely to cause any difference in the 
results, at least none of sufficient importance to change results 
materially. The number of consumers will probably show some 
advance, but there is no reason to believe that, considering this 
list of plants as a whole, there will be any important changes in 
the connected load per consumer or in the ratio of demand to 
connected load. The average ratio of demand to connected load 
is affected by the presence in the list of a few very high ratios. 
A reported demand equal to from 80 per cent to 100 per cent of 
total connected load cannot be said to be at all a representative 
figure, and the average, affected by these high ratios, does not 
furnish a fair basis of comparison. For purposes of this com- 
parison it seems that the ratio to be used is that which appears 
to be typical, that is, the mode, as shown in the forgoing table. 
On this basis, the maximum demand of the Whitewater Elec- 
tric Light Company would be about 45 per cent of 419.76 kws., 
or 189 kws. Reference to table IV shows that there are five 
plants in the group taken which report a maximum demand of 
less than 30 per cent of the connected load. The estimate of 
the respondent places the maximum demand for Whitewater at 
26 per cent of the connected load. Part of the difference be- 
tween .the Whitewater ratio and the average and the mode of 
the group shown in table IV may be accounted for by the fact 
that the power load at Whitewater is very small. Consequently 
there is no point at which the ratio of demand to connected load 
is raised very high, because of the lighting load crossing the 
power load at some time of the day. As nearly as the demand in 
Whitewater can be checked from the above figures, it appears 
that the demand will be at least 30 per cent of the connected 
load, or not less than 126 kws. 

Another method of checking this ratio approximately is fur- 
nished by the reported demand for the year ending Dec. 31, 
1907. At that time the demand reported by the company was 
120 kws., and there were 331 commercial consumers. On June 
30, 1910, there were 385 commercial lighting consumers and the 
number receiving service for the entire year ending on that 



Digitized by VjOOQIC 



CITY OP WHITEWATBB V. WHITEWATER EL. L. 00. 



145 



date was 367. It is not believed that the demand can be checked 
absolutely by comparing the number of consumers, but, so far 
as these figures may be accepted, they indicate that the maximum 
demand for the past year was not far from 130 kws. 

TABLE V. 



Popu- 
lation 



Ko.of 

eon- 

sumere 



Oapac- 
ItKln 
kws. 



Con- 
nected 
load, 
kws. 



Maxi- 
mum 
demand, 
kws. 



Total 
operating 
expensea, 
excluding 
taxes and 

depre- 
dation 



1. Bayfield ... 
4. Burlington 
1. Delavan ... 
1. Dod^ville . 
6. Edgerton .. 



1. Elroy 

1. Fort Atkiniion. 

1. Hartford 

4. Hayward 

2. Hudson 



1. Hurley 

4. I/ake Geneva .. 

1. Lancaster 

1. Mineral Point 
1. NeiUsviUe 



1. Mew London 

1. Oconomowoc 

2. Peshtigo 

1. Prairie du Chien. 
1. Beedaburg 



2. Sloe Lake 

1. Richland •Center. 

1. Rlpon 

2. River Palls 

1. 8hawano 



4. Sparta .... 
1. Stanley .... 
1. Tomah .... 
1. Tomahawk 
1. Waupun ... 
4. West Bend. 



Median ... 
Average .. 
Minimum . 
Maximum 



5. Whitewater, 
b. WblUwater, 



•09.. 
•10.. 



2,075 

2,fl25 
2,521 
2.1.92 
2; 410 

2,011 
3,S0O 
2,052 
2,000 
3,220 

2,000 
3,440 
2,565 
8,252 
2.117 

3,002 
8.013 
2,539 
3,179 
2,515 

3,410 
2,«15 
3,S11 
2,300 
2,446 

3,807 
2,722 
8.008 
2,02fl 
3,111 
2,303 



211 
410 



2,780 
2,000 
3,811 

3,106 
3,108 



116 
295 

810 
655 
806 
288 
404 

282 
306 
194 
218 
127 



351 
206 
228 
394 

409 
289 
166 
367 
210 

334 
173 
264 
20R 
»20 
181 



279 
116 



200 
200 
90 
186 

180 

150 
200 
00 
220 
300 

800 
880 
180 
400 
160 

190 
240 
512 
180 
140 

S20 

150 
177 
275 
275 



158 
210 
325 
100 
120 

200 
241 
60 
800 

210 
800 



220 

Bft7 

276 

60 

219 

90 

100 
60 
142 
378 



100 
100 
85 



720 
882 



65 
100 

60 
180 



600 
164 
180 
110 



100 
647 
280 
2S0 



96 
210 
186 



130 
242 

349 
100 

887 
896 



79 
84 
115 
164 



24 
449 
90O 

242 
2S3 
24 
895 



821 



150 
118 
40 

116 
145 
26 
600 



10^ 



14,863 78 
8.889 88 
7.688 71 
4,886 78 
7.812 87 

4,900 00 
0,648 38 
6.824 07 
8.680 87 
11.072 03 

4,374 00 
17.674 41 

8,468 14 
15,812 80 

4.586 70 

8,804 80 

11.660 06 
6,453 79 
6.584 88 
6,777 70 

2,816 96 
8,988 50 
6,904 48 
8,512 oa 

10.661 12 

9,80187 
8,604 89 

4.903 28 
6.027 00 
7,820 06 

12,240 67 

6.904 48 
7,417 18 
2.816 96 

17.674 41 

8.401 67 
0,893 68 



1. Steam. 

2. Hydraulic. 
8. Gas. 

4. Steam and Hydraulic. 

5. Steam and Gas. 

6. Purchased current. 

Table V contains a summary of the statistics of connected 

load and maximum demand for the plants operating in cities 

of from 2,000 to 4,000 population. In using these figures for 

comparative purposes, the average will again be seen to be de- 

10— R. D. 



Digitized by VjOOQIC 



146 



RAILROAD COMMISSION OP WISCONSIN. 



fective, due to the presence of sonie unusually large numbers for 
plants which very evidently cannot be compared with White- 
water. By using the median figure of each column, that is, the 
figure above and below which there are an equal number of 
plants, we get rid of the influence of extremes in this table and 
secure what may be considered normal statistics for this group. 
This would give us a representative plant with 288 commercial 
consumers, a connected load of 242 kws., and a demand of 115 
kws. Although it is not practicable, from this table, to state 
what the demand should be in the case of the Whitewater plant, 
these figures tend to corrotorate the statement that the demand 
is probably at least 130 kws. Checked by these methods, the 
maximum demand in this case apixiars to be considerably above 
that estimated by the company. The figure of 130 may not 
represent the exact demand, but it appears that the plant of the 
respondent must be prepared to meet a demand at least as great 
as this. 



TABLE \T. 

DISTRIBUTION OF CAPACITY EXPENHE8 BETWEEN ARCS AND INCAN- 

DE9CENT9. 

On Basis of Estimatbd Demand as Rrported by the Company. 





Total. 


Basis. 


Pet. 


\rcs. 
Amount. 


Incandescents. 




Pet. 


Amount. 


Steam power g«neratlon 

Distribution: 

Dlst. system op. labor 

sup. andexp... 
** ** maintenance... 

Con.su mptlon 
Customers' premises exp. . . . 


1637 00 

508 77 
23 38 
161 12 

38 89 

51 89 
20 (» 

180 00 

7(16 00 
133 53 
493 2t) 


Max. demand 
Ml. of wire... 

A 11 Incand . . . 


.16.9 

26 
26 
26 


tl07 65 

132 28 
608 
41 89 


83.1 

74 
74 

74 

100 


^29 35 

376 49 

17 30 

119 23 

38 89 


Trim, and Insp, mun. con. 
lamps 


!! arc 
All Incand... 


100 
100 


51 SSi 
20 (« 




■ Mun. con. lamp malnt 

Commerical 
Collection expenses 

General 

General office salaries 

sup. and exp.. 
Misc ffcn ex nenses 






100 

77.8 
77.8 
77.8 


180 00 


Overhead... 


22.2 
22.2 
22.2 


156 51 
29 64 
109 50 


S48 49 
103 89 
383 76 










Total direct expenses 

Depreciation 


12,963 52 

627 99 
976 88 
153 63 


1656 12 

188 40 
293 06 
46 09 

»l7l83"6r 




12.297 40 


Plant value.. 




430 59 


Interest 


Ci83 82 


Taxes , 


107 54 






Total capacity expenses 


$4,712 02 


13,528 35 









Digitized by VjOOQIC 



CITY OP WHITEWATE5R V. WHITEWATER EL. L. CO. 



147 



The expenses of the respondent for the year ending June 30, 
1910, were shown by table II to amount to $14,993.87, of which 
$4,712.02 may be designated capacity expenses and $10,281.85 
output expenses. The separation of capacity expenses between 
arc and incandescent has been ma<Ie U'ix)n two bases. Steam 
generation capacity expenses are divided between arcs and in- 
candescents according to the maximum demand upon the station 
of each class of lights. That is, the proportion of steam gen- 
eration capacity expenses, which is due to arc lighting, bears 
the same relation to the total steam generation capacity expenses 
that the maximum demand of the. arcs bears to the total maxi- 
mum demand. In table VI this apportionment of capacity ex- 
penses has been made upon the basis of the estimated demand 
reported by the company. 

From this table it appears that 16.9 per cent of steam gen- 
eration capacity expenses should be apportioned to arc lighting 
and 83.1 per cent to incandescent lighting. The result of this 
apportionment is to show a capacity expense due to arc lighting 
of $1,183.67. 





TABLE VII. 










APPORTIONMENT OF CAPACITY EXPENSES, 




ITSINO COMMIR8ION'8 EbtIMATK OF MAXIMUM DEMAND. 






Total. 


Basis. 


Arcs. 


Incande.scent.s. 


















Pet. 


Amount. 
190 45 


Pet. 


Amount. 


Steam power areneratlon 


Id37 00 


Max. demand 


14.2 


86.8 


1546 55 


Dlstri!»otIon: 

Dlst. sysUm op. labor 

sup. andexp.... 
maintenance... 


508 77 
23.% 
161 12 


MI. of wire... 


26 
2i) 
26 


132 28 
608 
41 89 


74 

74 
74 


.n76 49 

17 30 

119 23 


Consumption : 

CostomerM* premisea exp 

Trim, and insp. mun. con. 
lamps 


38 89 

51 89 
20 68 


All Incand... 
\\ arc 




too 

100 




100 





.% 89 


51 89 
20 (t8 




Man. con lamu matnt. .... 




Commercial: 
Collection expenses 


180 00 


All incand... 







100 


180 00 


Oeneral: 
(ien. office salaries 


706 00 
133 53 
49.J 21) 

12,953 52 


Overhead .... 
.... 


21.2 
21.2 
21.1 


149 46 

28 31 
104 57 

9625 61 


78.8 
78.8 
78.8 


555 .'>4 


Oeu. office sup. ande.\p 

Misc. gen. expenses 


105 22 
388.69 


Total direct expenses 


$2,327 91 


Depreciation 


627 90 
976 88 
153 (S 


Plant value. . 


30 

.SO 
30 


188 40 
293 0($ 
46 Oi» 

11.153 16 


70 
70 
70 

74.5 


439 59 


Interest 


683 82 


Taxes 


107 54 






Total capacity expenses 


$4.712 02 


24.5 


13,558 86 



Digitized by VjOOQIC 



148 



RAILROAD COMMISSION OF WISCONSIN. 



Table VII is an apportionment of the capacity expenses to 
arc and incandescent lighting on the basis of a total maximum 
demand of 130 kws. Under this method of apportionment the 
arc lighting capacity expenses appear as $1,153.16, and the 
capacity expenses of incandescent lighting as $3,558.86. 

The apportionment of output expenses to arcs and incandes- 
cents has been made upon lines repeatedly outlined by the Com- 
mission in former decisions. The only matter here which needs 
to be investigated is the total amount of current generated. 
Table III showed the company's statement of current generated 
to be 12^2,285 kw. hrs., of which 29,256 kw. hrs. are stated to 
have been for arc lighting purposes. These figures appear to 
be substantially correct. 

In table VIII the apportionment of output expenses to arc 
and incandescent lighting has been made: 



TABLE VIII. 

DISTRIBUTION OF OUTPUT EXPENSES BETWEEN ARCS AND 

INCANDESCENTS 

On BA8I8 OF Estimated Curbbnt Gknerated as Rbportbd bt the Company 





Total. 


Basis. 


Arcs. 


Incande.scents. 




Pet. 


Amount. 


Pet. 


Amount. 


Steam power generaUon 

Distribution 

Dist. system op. labor 

" SUP& exp... 
maintenance 

Consumption 
Cnm ino lamp renewals. 


15,733 05 

127 19 
584 
40 28 

208 21 
12 96 
155 00 
110 21 
25 94 
20 67 


Cur'tiren 

Mi. of wire... 

All Incand... 


23.9 

26 
26 
26 


$1,370 20 

33 07 
152 

10 47 


76.1 

74 
74 

74 

100 
100 


$4.362 85 

94 12 
432 
29 81 

208 21 


Customers' premises exp. . 








12 96 


Mun c lamus trim. &lnsD 


[[ arc.. 

" incand... 


100 
100 


155 66 
110 21 




" " ** HupplleSi... 






**' *' ino lamoreuewals 


100 


25 94 


** *' lamps, malnt 


" arc 


100 


20 67 






70 
70 
70 




Total direct expenses 


K{,440 01 

1,371 99 

2,134 20 

335 65 


11.701 80 

41160 
640 26 
100 70 


$4,738 21 


Depreciation 

Interest 


Plant val 


30 
30 
30 


960 39 
1,493 94 


Taxes 


234 95 






Total output expenses 


110.281 85 


$2,854 36 


fr.427 49 











This table shows arc lighting output expenses to.be $2,854.36. 

Combining the results of tables VI and VIII, we find the 
total arc lighting expense to be made of $1,183.67 capacity ex- 
pense, and $2,854.36 output expense, or a total of $4,038.03, 
making an expense per arc for the year of $100.93. Combin- 



Digitized by VjOOQIC 



CITY OP WHITKWATBB V. WHITEWATER EL. L. CO. 149 

ing tables VII and VIII, we get the arc lighting expense as made 
up of $1,153.16 capacity expense, and $2,854.36 output expense, 
or a total of $4,007.52, or an expense per arc of $100.19. 

The total operating expenses for the year ending June 30, 
1910, exclusive of taxes, depreciation and interest, are stated 
at $9,393.53, and including these items, at $14,993.87. In order 
to determine whether or not the expenses of arc lighting for this 
particular year are unduly high, an apportionment of expenses 
for the preceding year has been made. It appears from the rec- 
ords of the respondent that extensions to the plant were made 
amounting to $3,068.19 for the year ending June 30, 1909, and to 
$7,211.91 for the next year. From these figures it appears that 
the average value of the plant, for the year ending June 30, 1909, 
was approximately $36,000. 

The statistics of demand, current generated, miles of wire, 
etc., on which the apportionment for this year has been based, 
are the same as those used for the year ending June 30, 1910, 
as reported by the company, owing to the fact that estimates 
for the year ending June 30, 1909, are not available. As it is 
but natural to assume that the totals of these items will increase 
with the development and the taking on of new consumers, it 
will appear that the percentage apportioned to arc lighting in 

1909, upon the basis of the reports for the year ending June 30, 

1910, will be rather lower than the percentage which should 
actually be assigned to this class of lighting for the year ending 
June 30, 1909. The result of this is that the expenses of arc 
lighting for that year, as shown in the following tables, are 
lower than the actual expenses. Table IX, X, and XI contain 
these apportionments for the year covered by the 1909 report to 
the Commission: 



Digitized by VjOOQIC 



150 



RAILROAD COMMISSION OF WISCONSIN. 



TAIJLK IX. 
EXPENSE.-? FOR YEAR ENDINtJ .ITNE 30. 1000. 



Steam i?enerat ion 

Distribution 

Dlst. system operatim; labor 

maintenance 

Consumption 
Commercial inc. lamp renewals. 
Trimmlntf & Insp. mun. c. lamps 

Commercial 
Collection expenses 

(ieneral 

(ieneral office salaries 

" sup. & exp 

Misc. areneral expenses 

Total direct expenses 

Taxes 

Depreciation, AM on|36.000 

Interest, 7'ji on 130,000 

Total expenses 





Capacity. 


() 


iitput. 


Total. 


Pet. 


Amount. 


Pet 


AuiouiiC. 


S5.141f>l 


10 


S514 15 


90 


14,627 36 


750 00 
700 00 


80 

80 


iWOOO 
500 00 


20 
20 


150 00 
140 00 


1U3 04 



.25 




100 
75 


193 04 


210 00 


52 50 


157 50 


180 00 


100 


180 00 






540 00 


100 
100 
100 


540 00 
125 00 
502 12 






125 00 






.W* 12 












18,401 07 


37.3 


».133 77 


02.7 


15,267 90 


493 28 
1.620 00 
2,520 00 


37.3 
37.3 
37.3 


183 90 
604 26 
939 U6 


62.7 
62.7 
62.7 


309 29 
1,015 74 
l,5HO04 


113.034 95 


$4,801 08 


t8. 172 97 



TABLE X. 
CAPACITY EXPENSES, YEAR ENDING JITNE 30. 1909. 



Steam ireneration 

Distribution: 
Dist. system oix'ratinp labor 
Dist. system maintenance. . . 

Consumption: 
Trim, and Insp. mun. c. lami)s 

Commercial: 
Collection expenses 



(jeneral: 

(ien. office salaries 

(ien. offlci* sup. and exp., 
Misc. irt'neral expenses.. . 

Total direct expenses. . 



Taxes 

Depreciation . 
Interest 



Total capacity expenses. 



Total. 



1514 15 



600 
500 



52 50 



180 00 



540 
125 
562 



Basis. 



Max, demand 



Mi. of wire... 
Ml. of wire... 



All arc... 



00 



12 
13, 133 tT 



183 
004 
939 



-I 



All incand. 



Overhead 

Overhead 

Overhead..., 



Plant value.. 
Plant value.. 
Plant value.. 



$4,861 98 I 



.\rcs. 
Pet. Amount. 



16.1 



100 



23.1 
23.1 
23.1 



23.1 

30 
30 



S86 89 



156 00 
145 iH) 



52 50 



124 74 
28 8K 
129 85 



$724 46 

55 20 
IKl 28 
281 99 



$1,242 93 



I ncan- 
descenls. 



Pet. Amount. 



83.1 



76.9 
76.9 
76.9 



76.9 

70 
70 
70 



$427 36 



444 00 
414 40 



180 00 



415 26 

96 12 

432 27 



$2,409 13 

128 S) 
422 97 

667 i»7 

$3,619 05 



Digitized by VjOOQIC 



CITY OP WHITEWATER V, WHITEWATER EL. L. CO. 



151 



TABLE XL 
OUTPUT EXPENSES. YEAR ENDING .TI:NE 30, 1909. 





Total. 


Basis. 


Arcs. 


Incan- 
(lescents. 




Pet. 


Amount. 


Pet. 
76.1 

74 
74 

100 


30 
30 
30 


Amount. 


Steam ireneration 


4.027 36 

150 00 
140 00 

193 04 
157 50 


Cur't sren.... 

Mi. of wire... 
Ml. of wire... 

AUincand... 
All arc 


23.9 1.106 94 

20 ' 3900 
26 , 3640 

1 

1 

lOJ ' 1&7 50 


3,521 42 


Distribution: 

Dlst. system op. labor 

Dist. system maintenance... . 

Consnmutlon: 

Com. inc. lamp renewals 

Trim, and Insp. man. lamps. 


111 00 
103 60 

193 04 










Total direct expenses 


15,267 90 

309 20 
1.015 74 
1,580 04 


11,338 84 


13,929 06 


Taxes 


Plant val.... 
Plant val.... 
Plant val.... 


30 
30 
30 


92 79 
304 72 
474 01 


216 50 


Depreciation 


711 OS 


Interest 


1,106 03 








Total output expenses iS. 172 97 


12.210 36 


15,962 61 
















The result of these apportionments shows a total arc light- 
ing expense for the year of $3,453.29, or $86.33 per lamp. As 
pointed out above, the actual expense of arc lighting for the year 
in question was probably somewhat above this amount. 

In view of the fact that the contract between the city of White- 
water and the Whitewater Electric Light Company provides that 
the city shall pay $80 per lamp per year, it appears from this 
analysis of costs that the arc lighting is being done at a loss to 
the company. Attention should, however, be called to the fact 
that the above expenses have been computed upon the assump- 
tion that the arc lamps are each making a demand upon the 
station of 460 watts, which the respondent considers equivalent 
to a demand of 432 watts at the lamp, as required by the con- 
tract. The above statements of expense are, therefore, the ex- 
pense per arc lamp, assuming that lamps are always burning up 
U) the full required wattage. The question of what the actuaJ de- 
mand |x*r arc u|X)n the station amounts to has not l>een deter- 
mined. Ordinarily, it may be said that the allowance for line 
loss, or the difference between demand on the station and wattage 
at the lamp, is about 10 per cent. This would indicate that the 
wattage at the lamp, with a demand of 460 watts on the station, 
would be from 410 to 420. That is, the above statement of ex- 
penses will cover the expense to the company of keeping the 
arc lamps burning with a wattage of from 410 to 420 watts at 
the lamp. 

The question now arises whether or not the total expenses of 



Digitized by VjOOQIC 



152 



BAILEOAD COMMISSION OP WISCONSIN. 



the Whitewater Electric Light Company are excessive, and if 
so, in what items of exj)ense does this excess appear. By refer- 
ence to table V, we find that the total operating expenses, ex- 
inclu'cIUng depreciation and interest, of electric utilities in the state 
which have from' 200 to 500 consumers, vary from $2,816.96 to 
$17,674.14. The average exi)ense is $7,417.18, and the expenses 
cf the median or middle company of the 31 listed are $5,904.48. 
The expenses of the Whitewater plant are thus seen to be above 
the average for this group, but as this plant has a larger number 
of consumers and a greater capacity than the average and median 
of those listed, it cannot be said from the facts shown in table V 
that its expenses are excessive. There has been no evidence 
presented to the Commission to show that the expenses of the rc- 
s|X)!ndent are excessive, nor has the city made any such charge. 

A' comparison of the exijenses of the company, taken from the 
three reports which it has made to the Commission, has been 
made in table XII : 

TABLE XII. 

EXPENSES OF OPERATION 
Whitewater Electric Light Company 





Year ending 
Dec. 31. 11X17 


Year ending; Year ending 
June 30. 1900 June 30, 1910 


Power fireneraUon : 

Pow«r plant waffes 


13.246 09 

1,675 74 

120 00 


13.506 00 

1,455 51 

120 00 


i3 065 56 


Fuel for steam 


2 200 70 


Water for steam 


149 73 


Miscellaneous steam supulies and expenses 


165 00 


Maintenance boiler plant equipment 






340 14 


Miscellaneous power plant sup. andexp. .. 






382 06 


Maintenance power plant 






66 86 


Lubricants and waste 


112 00 










Total power generation 


15.153 83 


15.141 51 


10 370 05 






Distribution: 

Distribution system operatini? Ia1'x>r 




t750 00 


KTV) 06 


" supplies and expenses 




29 22 


** " maintenance 




700 00 


201 40 








Total distribution 


f1.450 00 
S193 04 


SS66 58 








Consumption: 

Commercial Inc. lamp I'enewals 


1208 21 


Customers' premises expenses 







51 85 


Trimming & Inspecting munic. con. lamps. 




210 00 


2U7 56 


Munic. con. lamp supplies 




110 21 


Munlc. con inc. lamp i'enewals 






25 94 


Maint. of mun. con. lamps 






41 95 










Total consumption 




1403 04 
S180 00 


t645 11 


Commercial — collection total 


-=^'-^--'--= 


$180 00 








General 

General ofHce salaries 


11.200 00 


1540 00 
125 00 


t705 00 


supplies and expenses 


133 53 


Insurance 


57 00 
1,871 19 




Miscellaneous general expenses 


562 12 


493 26 






Total general 


13,128 19 


$1,227 12 


SI 331 79 






Total operating expenses 


18.282 02 


18.401 67 


•9,393 53 



Digitized by VjOOQIC 



CITY OP WHITEWATER V. WHITEWATER EL. L. CO. 



153 



it will be noticed that the expenses reported for the years end- 
ing Dec. 31, 1907, and June 30, 1909, are nearly the same, but 
that the expenses for the. year ending June 30, 1910, show a con- 
siderable increase, especially in the item of fuel for steam. From 
this table it appears that the expenses for the year ending June 
30, 1910, may be somewhat higher than they may be expected 
to average, even for a few years to come, but there is nothing 
to indicate that the expenses reported for the previous year ore 
not fairly representative. From the financial statement which 
the company has made to the Commission, it is possible to par- 
tially check expenses for a number of years. The results of 
this are shown in table XIII : 



TABLE XIII. 
DISBURSEMENTS. 
Of TUB Whitewater EriECTRic Light Company, 
Excludtna hUerfitt, DlvUiendH, Tax&<, and Payment of T.Manx. 



Disbursements, from financial 
statement. 



18j«. fiscal year... 


S>). 395 42 


18sC. " *• 


5 472 88 


1898, 


7,154 12 


1899. 


6.297 20 


190O, 


7.274 48 


l«ll. 


8.787 42 


l«fi. 


9,920 66 


1903, " 


8,614 99 


1904. 


8.491 37 


1906, •• " 


8.194 99 


19ttS. 


9,840 52 


1907. • 


10.049 60 


1907.ca1endar year 


8,282 02 


1909. fiscal year... 


8,401 67 


l9iU, " 


9,393 53 



Deduct. 



$1,500 00 (boiler) 

522 50 (smokestack) 

938 92 (transformers and meters). . . 
2.2.31 23 ( ** . imprvmts, arc lami)s) 
3,146 32 (improvements) 

911 83 Omprovpments) 

664 32 (meters) 

1.U25 in (meters and improvements) 

835 83 ( *■ , transformers and imp\ 

518 40 (meters and transformers).... 



Approximate 
operatlnsr 
expenses. 



$4,865 42 
4.9M)38 
7.154 12 
6,297 20 
6.335 56 
6.555 19 
6.783 34 
7.70B 16 
7,827 06 
7.169 07 
9.004 09 
9.531 20 
8.282 02 
8,401 67 
9.39'^ 53 



In this table, the column headed "Disbursements" represents 
all expenses of the company, other than those for taxes, depre- 
ciation, and interest. In the next column have been placed those 
items which were clearly in the nature of additions to the plant 
and consequently should be deducted from total disbursements 
to reach the approximate operating expenses which are shown in 
the last column. It appears certain that the approximate operat- 
ing expenses reached are in excess of the true amount in years 
for which it was not possible to separate expenses of construction 
and additions from total disbursements. By a process of smooth- 



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154 RAn.ROAD COMMISSION OP WISCONSIN. 

ing these approximate operating expenses we can distribute 
this excess and any items of expense which arc unusually high 
for any one year, over a period of years, and thus get an ap- 
proximate operating expense in which the defects apparent in the 
above table are largely eliminated. This smoothing has been 
done by three year periods, and after the average of the first 
three years is obtained the first year is dropped and another 
added. Jly continuing this process throughout the entire periml, 
each average contains two years include<l in the preceding aver- 
age. By this process we secure the following table : 

TABLE XIV. 

Period Average expense 

1896-1898 inclusive $5 656 64 

1897-1899 '• :: 6;i33 90 

1898-1900 " 6,595 63 

1899-1901 " 6,395 98 

1900-1902 " 6,558 03 

1901-1903 " 7.013 89 

1902-1904 " 7,437 85 

1903-1905 •• 7.566 43 

1904-1906 •• 8.000 29 

1905-1907 " 8,568 32 

1906-1908 " 8,939 30 

1907-19091 " : 8,738 30 

1907-19102 " 8.692 41 



This table shows clearly the tendency toward increased ex- 
penses. The figures which do not appear to be exactly in line 
with this tendency may be explained by the fact that the amount 
of construction, which should be deducted from total disburse- 
ments, could not be determined, and consequently the approximate 
operating expenses used are excessive. 

From these computations it appears that the fair expenses 
on which the cost of arc lighting should be based are about 
$8,700.00, as compared with reported expenses for the past 
fiscal year of $9,303.53. With this approximate operating ex- 
pense it is not practicable to make an apportionment to deter- 
mine the exact average cost per arc lamp, but as the expense 



1 Includes both calendar and fiscal year of 1907. 

2 Includes calendar year 1907. and fiscal years 1909 and 1910. There 
is a six month period from Dec. 31, 1907, to .Tune 30, 11)08. for which 
there is no report, and the six months from Dec. 31. 1906, to June 30, 
1907, are reported both in the report for the fiscal year 1907 and for 
the calendar year 1907. 



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CITY OP WHITEWATER V. WHITEWATER EL. L. 00. 15b 

ccmputecl on the basis of $8,401.67 for the year ending June 30, 
1909, is at least $86.33, and on the basis of $9,393.53' for the 
next year is nearly $100, it appears that the proper expense cs\p- 
not be lower than $90 per arc lamp, using the results of the 
smoothing process as a basis. It appears from all data available 
that $00 per lamp is the lowest amount at which the respondent 
can fulfill the terms of its contract with the city of Whitewater 
to furnisli arc lighting to the city and secure a proper return 
upon the property used. 

In addition to the provisions of the contract mentioned above, 
that the Whitewater Electric Light Company is to furnish the 
city with forty arc lamps of a standard illuminating power of 
20OO candles and with 432 watts of electrical energy measured 
at the arc, there is a provision that 

***** -j^ ^^^^ Qf gj^jj ^j.^ lights being extinguished dur- 
ing any 'night or any part of any night required by this contract 
to be lighted, there may be deducted from the current or any 
following payment a sum proportioned to the whole monthly 
price as such shortage is to the whole monthly time. And in 
case any single arc light or lights shall during any time fail to 
give its or their proper light as herein required, there may be 
deducted from the current or any following payment 5 cts. per 
hour per light for all the time of any such failure within the 
times prescribed for illumination thereof. And in case said arc 
lights or any of them shall at any time of illumination as herein- 
before required fall below the standard of 432 watts measured 
at the lamp, there may be deducted from the current or any fol- 
lowing payment a sum directly proportioned to the amount of 
such shortage. * * * And it is further covenanted and 
a^ecd by the party of the first part [the Whitewater Electric 
Light Company] that in case of a failure in any material respect 
on its part to perform any of its covenants and agreements 
herein contained, or in case of any neglect on its part to carry 
out the terms' and conditions of this agreement, the party of the 
second part [the city of Whitewater] may at its option, upon 
such failure or neglect, declare this contract forfeited and an- 
nulled, except that in case of damage from the elements or any 
cause not the fault of said party of the first part or in case of 
necessary repairs or replacements of machinery, they may have 
a reasonable time for repairs or replacements." 

Another provision in the contract states 

" * * * that at any time and all times during the term 
of this contract the party of the second part shall have the right 
to test the quality and the power of each and every of the said 
lights so furnished and supplied by the said party of the first 



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156 nAiLROAb coMMisstoK of Wisconsin. 

part under this contract, and in so doing the party of the second 
part may call to its assistance any recognized expert electrician 
and if upon any such test any light shall prove to be below the 
standard of illuminating jx^wer hereinabove prescribed, then and 
in that event the party of the first part covenants and agrees to 
pay the cost and expense connected with such test, but not ex- 
ceeding $75 for any one test; if the lights so tested shall equal 
or exceed in illuminating power the standard so fixed by this 
contract, the cost and expense connected with such test shall be 
paid by the party of the second part." 

A superficial reading of this contract might give the impres- 
sion that the city is fully protected by its terms and needs no 
aid in holding the company to these terms, but a careful anal- 
ysis of its provisions reveals several features which make it 
somewhat difficult for the city to enforce the provisions of the 
contract, if necessity for such action should arise. 

In tltt first place, the efficiency of the lamps is subject to sharp 
variations. The service may be up to the contract requirements 
one day and below these requirements on the next. Without 
daily tests, therefore, it would be no easy matter to determine the 
exact amounts that should be deducted from the payments to 
the company for failures to keep the ser\nce up to the provi- 
sions of the contract. Furthermore, it seems that the terms of 
the contract are inconsistent. The arc lamps specified by the 
terms of the contract were to be "new lamps of as good kind as 
can now be found in the market * * * and of the standard 
illuminating power of 2000 candles each with. 432 watts of electri- 
cal energy measured at each lamp.'* This at once raises the ques- 
tion of what is a lamp of a standard illuminating capacity of 
2000 candle power. It appears from the report of the Commis- 
sion's inspector and from the correspondence of the company 
that the type of lamp in use in Whitewater is tlie Manhattan 
shunt regulated, automatic cut off, a. c. series arc, rated at 7 
amperes and 432 watts. This is the type of lamp which has 
been accepted by the city. It apj^ears, however, that this type 
if lam([) is not a 2000 candllc jx>wer lamp and that the term 
"standard illuminating power of 2000 candles," as it appears 
in the contract, is inconsistent with the provision for a lamp 
rated at 432 watts and the acceptance by the city of the type 
of lamp in use. 

The following extracts from a report by the engineering staff 



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CITY OP WHITEWATER V, WHITEWATER EL. L. 00. 157 

of the Commission states the situation regarding rated candle 
power of arc lamps in these words : 

**No governmental body has, to our knowledge, defined or 
rated arc lamps, and street lighting still remains unstandardized, 
much to the confusion of parties to .public lighting contracts, as 
well as the illuminating profession. It may be pointed out, how- 
ever, that it is generally accepted by illuminating engineers that 
the term *2,000 candle power' is a nominal rating and that the 
original arc to which it was applied was the 9.6 ampere d. c. 
open arc; that the 7.5 ampere enclosed arc is a fair substitute 
for the same; and that the 6.6 ampere a. c. enclosed arc is one 
which receives a nominal rating of 1,200 candle power." 

Tlie report of the conini'ttee of the National Electric Light 
Association, appointed to consider specifications for street light- 
ing, was made to the association in June, 1907. This report 
takes up the old definition of 2,000 candle power arc, and goes 
on to show how the introduction of more efficient lamps, both 
arc and ir.candescent, has rendered it valueless and of no mean- 
ing in present-day practice. In speaking of the Colorado 
Springs lighting controversy, the "Illuminating Engineer" states: 

"It w:i:; admitted at once by all the experts that the term '2,000 
candle power' must be taken in a purely Pickwickian sense, and 
by no means represented the actual measurement of the candle 
power of any practical arc lamp for street lighting purposes that 
had ever been made up to that time (1898). It was likewise 
agreed thnt the 9.6 ampere d. c. open arc lamp fulfilled the con- 
ditions of the specifications at the time the franchise was 
granted." 

The extracts quoted above are sufficient to show that the term 
*'2000 candle power" in the contract between the parties to this 
case is merely a nominal rating and does not represent the actual 
amount of light given, and that the provision of the contract 
providing for the city deducting a certain sum in case lamps 
do not reach the stated illuminating power is practially impos- 
sible of enforcement. 

It appears that the only test which would indicate whether the 
lamps in Whitewater come up to the specifications in the contract 
would be a wattage test. Illuminating engineers are by no means 
agreed that the wattage basis is the proper basis for rating arc 
lamps, but it appears, in view of the provisions of the contract 
existing in this case, that it is the only practicable one for use 
in the city of Whitewater at the present time. There are other 
factors which influence the amount of illumination furnished 



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158 



RAILROAD COMMISSION OP WISC50NSIN. 



by the lamps, such as the amount of current flowing, the adjust- 
nient of the mechanism of the lamp, the height of the arc in the 
lamp, the amount of deposit on globes, the kind of carbons, globes 
and reflectors used. Thus the wattage test would not, in itself, 
always indicate the illuminating power of the lamp. The "stand- 
ard illuminating power of 2,000 candles" has been found to l)e 
only a nominal rating, not indicative of the actual illumination of 
the lamp. 

A wattage test and inspection was made under the direction 
of the Commission, under date of Sep. 21, li)10. The inspec- 
tors report shows that most of the arc lamp globes were slightly 
dirty, that arc lamps are hung without reference to any stan- 
dard height, and that there is considerable obstruction to the 
light, due to trees not being properly trimmed. 

In this wattage determination conservative readings were t::iken 
at five second intervals, and the average of these readings was 
cominited as the wattage for the arc lamp under test. After 
the fourth lamp, consecutive readings covered as nearly as pos- 
sible the entire period from feed to feed of the lamp. Lamps 
were turned on a half hour before starting the wattage tests 
and kept burning continuously during the test. In order to in- 
sure normal operating conditions, after each lamp was cut out 
for inserting the instruments, it was allowed to burn for 8 to 
10 minutes before readings were taken. A summary of the re- 
sults of the wattage tests is given in the following table : 

TABLE XV. 



Test 
iiuni))er. 



1 

2 

8 

4 

5 

6 

7 

8 

9 

10 

II 

12 

13 

14 



Loc-atlon. 



Fourth & Whitewater 

( 'enter & Thirtl 

N. Third & W. Nortli 

I'reemont & Pratt 

North Prairie & Pratt 

NorUi Prairie 1h*1 ween Pratt & M aln 

Prairie & Main 

Main & Whiton 

S. Prairie & Center 

Cliurch & Center 

M aln & Whitewater 

State A Wisconsin ^ 

.lefferson& W. North 

Center & Cotla^rc 

Minimum 

Maximum 

Averanre 



Watts. 



.378 

4<>4.d 

352 

361 

400.4 

394.4 

352.4 

272.2 

394 

412.6 
414.6 
3B7.6 
S32.2 

272.2 
414.6 
372.2 



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CITY OF WHITEWATER V. WHITEWATER EL. L. CO. 159 

The following extract from the report of the Commission's 
inspectors bears upon the • matter of the service rendered in 
Whitewater : 

'The tests made Sep. 21 and 22, 1910, by the Commission's 
inspectors showed all the lamps to be operating below standard 
wattage by amounts varying from' 17 to 100 watts for the 14 
lamps tested, the standard being 432 watts per lamp. A differ- 
ence of 0.4 amperes in the operating current of the two circuits 
was also found. 

'The correction of the current error of the station instruments 
and a readjustment of most of the lamps would be necessary to 
obtain standard wattage on all the lamps. The company is 
equipped with adequate facilities for doing this." 

It appears, then, that the term ''standard illuminating power 
of 2,000 candles" is a term which is practically meaningless, and 
that it would be impossible to bring the type of lamp in use in 
Whitewater to this actual candle power. 

Keeping the energy at the prescribed wattage will not neces- 
^arily keep the lamps at a standard illuminating power. Wattage 
is not the only measure of the amount of illumination produced, 
for this is influenced by other factors, some of which are men- 
tioned above. 

Referring now to the computations of cost of arc lighting, it 
will be remembered that a figure of about $90 per year per lamp 
was found as the probable cost to the company of furnishing 
the service. This cost, however, is based upon the assumption 
that lamps are kept burning up to the full requirement of 432 
watts at the lamp, which the company states would create a de- 
mand upon the power station of about 460 watts per lamp. If 
the lamps are not operated up to their full capacity, it is possible 
that, owing to the smaller amount of current used, the cost may 
be somewhat below the figure given. 

The contract with the city, as stated above, provides that the 
city shall pay the company $80 per lamp per year. In view of 
the fact that the cost to the company seems to Ik* in excess of 
this amount, it may appear an injustice to the respondent to order 
the service kept up to a standard. 

On the other hand, it appears that the plant, when its business 
as a whole is considered, is not as badly off as the above figure 
would seem to indicate. Tb?it this is the case is shown by the 



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160 RAILROAD COMMISSION OF WISCONSIN. 

income account of the company for the past two years, which is 
given in the following table : 

INCOME ACCOUNTS, 1909 and 1910. 
1909. • 

Commercial lighting earnings. .' $10,280 78 

Municipal contract arc earnings 3[l89 26 

Municipal contract incandescent earnings 432 00 

Non-operating revenues 746 69 

Total revenues $14 , 648 73 

Operating expense, excluding taxes, depreciation and in- 
terest 8,401 67 

Balance $6,247 06 

Taxes 493 28 

Net earnings $5,753 78 

1910. 

Commercial lighting earnings $10,821 33 

Municipal contract arc earnings 3,200 10 

Municipal contract incandescent earnings 460 96 

Commercial power earnings 212 21 

Non-operating revenues 540 15 

Total revenues $15,234 75 

Operating expenses, excluding taxes, depreciation and in- 
terest 9,39*3 53 

Balance $5,841 22 

Taxes 489 28 

Net earnings $5,351 94 

From the preceding income accounts it thus appears that the 
respondent's net earnings amounted to about $5,753 in 1909 and 
$5,352 in 1910. As the net earnings under these statements, 
which were niade up from the reports of the respondent, are the 
amounts that are available for interest and depreciation on the 
investment, the plant appears to be on a fairly sound financial 
basis. While its net earnings can by no means be regarded as 
unreasonably high, they would still seem to be high enough so 
that, from this point of view, there are no good reasons why the 
services should be kept at a lower than reasonable standard of 
efficiency. In fact, a full consideration of .these and of the re- 
maining facts that have been presented herein has led us to the 
conclusion that it is only just and reasonable that the respondent 
should be required to bring about such improvements in its equip- 
ment and methods of operation that it can furnish and maintain 
the proper wattage, and that its serances in other respects be 



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CITY OP WHITBWATKB V, WHITEWATER Wu. L. CO. 161 

placed and maintained on a basis that is reasonably adequate 
under the circumstances. 

It is Therefore Ordered, That the respondent in this case, 
the Whitewater Electric Light Company, make such readjust- 
ments in its lamps and other equipment that it will Supply and 
maintain 432 watts of electrical energy at each of its arc lamps 
during the time these lamps are in actual use and that its service 
tn other respects be brought up to standards that are reasonable 
and adequate. 

11— R. D. 



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162 RA.nuROAD COMMISSION OP WISCONSIN. 



R. R. HIESTAND rr al. 

VB. 

SOUTHERN WISCONSIN RAILWAY COMPANY. 



Sulmitted Sep, 16, 1910. Decided Dec. 16, 1910. 



Petition alleging that the service on the East Johnson Street line of 
(he respondent in the city of Madison is inadequate, in that 
the cars are not of sufficient capacity, are unsanitary and un- 
comfortable; that the schedule Is not maintained; that the 
track is in very poor condition. Also that such service is 
discriminated against as compared with the service on other 
portions of the respondent's system. 

Comprehensive investigations of the service were made by the engi- 
neering stafT of the Commission. It was found that prac- 
tically no schedule was being maintained; that a passenger 
would fail to find a car on schedule in from 40 to 87 times out 
of a hundred; that car men do not observe the rules and regu- 
lations. The adoption of a manual block system is recom- 
mended. 

Held^ with respect to the old cars in use: That the public can not rea- 
sonably object to their use, provided they are maintained In 
serviceable condition and are capable of doing the work re- 
quired of them; that both the public and respondent will be 
gainers if equipment which is still in serviceable condition is 
used as long as practicable and not scrapped in advance of 
necessity; that the respondent is of sufficient financial ability 
to purchase additional cars as necessity requires. The re* 
spondent is ordered, within ten days, to publish a proper 
train schedule and operate its cars accordingly. 

This petition is signed by twenty-five residents of the city of 
Madison. It alleges that the patrons of the respondent's so- 
called East Johnson Street line are discriminated against in the 
matter of service, as compared with the patrons of the longer, 
or so-called Fair Oaks-Wingra Park line, in the following par- 
ticulars, to wit: 

(a) In the type of cars furnished. Most of the time two of 
the three cars operated on this line are of the enclosed type, 
with but one entrance at each end, too small for the average 
patronage; insufferably hot and uncomfortable in summer; un- 
sanitary in all seasons and poorly ventilated in the winter. The 
company uses the semi-convertible style of car on the other line 
and for one or two months in the spring of the present yeaf did 
maintain one car of this type on the East Johnson Street line, 



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HUBSTAND BT AL. V. SO. WIS. RF CO. 163 

but the rest were smaller, much more uncomfortable, and 
especially during "rush hours*' incapable of handling the traffic. 
These small cars, whether they be the kind which are sealed on 
each end at one side or of th« common type, are exceedingly un- 
comfortable in every way as compared with the larger "semi-con- 
vertible" cars. 

(b) The schedule — supposed to be on a headway of twelve 
minutes^s not maintained properly. Variations of five and 
six minutes are frequent and habitual, and there have been many 
times when cars have been as much as fifteen minutes late, and 
diligent investigation failed to reveal any sort of "break down" 
as the cause. This failure to preserve the schedule appears to 
the petitioners to be largely due to the fact that car crews wait 
for trains at the "West Madison" station of the Chicago, Mil- 
waukee & St. Paul Railway Co., even when such trains are 
several minutes late. Petitioners assert that transient users of 
this street car line have less claim to extraordinary service than 
those who reside in those sections tributary to the line and who 
patronize the street cars evei7 day. They are confident that 
investigation will prove the truth of this assertion, that persons 
who live specific distances from the "capitol square" in sections 
of the city served by the line complained of, use the cars of that 
line with greater frequency than do patrons of the other line 
residing the same distances on the other side of the city (Sixth 
ward) from the "capitol square". Therefore, they are con- 
vinced that the East Johnson Street line of the Southern Wis- 
consin Railway Company is a much more profitable line than 
the Fair Oaks-Wingra Park line, proportionate length of each 
line being considered. In view of this fact, if for no other reason, 
they believe they are entitled to the best service the company 
can furnish, what shall constitute such service being for the 
Railroad Commission to determine. 

(c) With the exception of that portion of the line com- 
plained of which runs half-way around the "capitol square", 
a portion recently repaired on East Johnson street between 
North Few and North Baldwin streets, and various other shorty 
sections which have been repaired from time to time, the track 
on the East Johnson Street line is in a very bad condition. The 
company at present is repairing and laying new ties on West 
Main street. Petitioners ask for such relief in this regard as 
the Commission may find to be demanded and justified by con- 
ditions. 



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164 RAILROAD COMMISSION OP WISCONSIN. 

Wherefore, petitioners pray that the responden* be required 
to desist from the aforesaid discriminations, and for such other 
and further order as the Commission may deem necessary and 
just in the premises. 

No answer was filed by the respondent. 

The hearing was held at the office of the Commission in the 
city of Madison on Sep. 16, 1910. It R. Hiestand and \V. W. 
Warner were the only petitioners who appeared. The respon- 
dent was represented by Jones & Schuhring, 

The testimony of petitioners was to the effect that some of 
the cars operated by the respondent on the so-called East John- 
son Street line, during the cold weather and semi-cold weather, 
are unsanitary, poorly ventilated, uncomfortably small, and in- 
capable of handling the traffic during the rush hours, at about 
8 :00 a. m., during the noon hour, and from 5 :00 to 6 :00 p. m., 
and frequently during other periods of the day, such as late in 
the evenings and afternoons, when there is some particular at- 
traction at the theater or elsewhere. The particular objections 
to the type of oax in use are that one si«de of the vestibule is 
closed, causing the ventilation to be very poor; that the vesti- 
bule is very small, and on account of the poor ventilation inside 
crowds remain out on the platform, obstructing the passage- 
way, and discommoding people entering and leaving the car; 
that only a part of the ventilators at the top of the car can be 
opened, and that although the seating capacity is limited to about 
twenty- four seats, frequently fifty passengers are crowded into a 
car, and consequently a large number of people prefer to walk 
rather than suffer the inconvenience of riding in a crowded car. 
Also, passengers have been carried beyond their destination, 
through their inability to get through the crowd on the plat- 
form. The crowding feature applies mostly to stormy weather. 
With this type of cars flat wheels are said to be very frequent, 
and after complaint was made to the Commission about this, 
the company agreed to repair such wheels, but it is claimed that 
there were instances thereafter when a car continued to run 
with a flat wheel for three weeks. The witnesses maintained 
tV"t the track on Hamilton street, from Paterson to Few, and 
from Baldwin down the hill, is very rough. 

A ten-minute schedule is supposed to l)e in effect on the line 
in controversy at the present time, which is said to be only tem- 
porary. This schedule is not adhered to very closely, and, as 



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HIESTAND ET AL. I'. SO. WIS. RY CO. 165 

the trip can easily be made in eight minutes, the cars go at a 
very slow speed, wjiich is annoying, and especially so because of 
the poor ventilation of the cars. A twelve-minute schedule, 
if adhered to, and with comfortable cars, would be more advan- 
tageous to the public. Under the existing conditions the cars 
are frequently from two to twenty minutes late, and often wait 
for trains which are behind time. 

Complaint is also made of d^'scourteous treatment of passen- 
gers by conductors, when the former have asked that the ven- 
tilators be opened in order to obtain relief from the impure and 
offensive air within the cars. 

To relieve the congestion of the cars it was suggested that an 
extra car be put into service during the hours of heaviest traffic, 
and to further relieve the inconvenience of passengers caused by 
the conditions above mentioned it was deemed advisable to re- 
place with new cars two of the three cars now in service on said 
line, which arc obsolete in type and have entirely oiftlived their 
usefulness. 

Respondent contends it has a limited number of cars on its 
line, and while it is not satisfied with the type of car to which 
objection is made, it is obliged to use these until it can secure 
others. It formerly had three of these cars in service, but at 
the present time only two of them are in service. They are be- 
ing operated on the Johnson Street line, as this line is the least 
over-burdened, with the exception of the South Madison line. 
During the past four years the respondent has purchased eleven 
new cars, and hopes to purchase others in the future as rapidly 
as its earnings permit. The track on the Johnson Street line is 
loo rough for the operation of semi-convertible cars. Relative 
to the sanitation of the cars, it is said that closing one side of 
the vestibule makes no difference in the ventilation and) that this 
is the custom also on Uie main line; that the cars are scrubbed 
inside and out every fifth day ; that crews are supposed to sweep 
out the cars at the end of every trip, but respondent is aware 
that some crews are negligent in this respect; that there is the 
same number of cubic feet of air space in the smaller cars in 
porportion to that in the larger cars ; and that conductors find it 
impossible to keep the air at a temperature suitable to all passen- 
gers, as no two people desire the same amount of warmth. 

In r^^rd to the schedule, resj)ondent's contention is that un- 
til some time in July, 1910, a twelve minute schedule was main- 



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166 KAILfiOAD COMMISSION OF WISCONSIN. 

tained on the said line, and that every effort is made to maintain 
the present schedule on all lines, as this contributes materially 
to tlie earnings of the company. 1 he scheduk is made to meet 
the average load, but when the car is obliged to make more than 
the average number of stops on a trip, it is impossible to be on 
time. On the particular line in question, at times when cars arc 
not obliged to make the average number of stops, it is difficuli 
not to be ahead of the schedule. Furthermore, running the 
cars on the resistance points on the controller burns out the 
coils, and consequently orders are given to the conductors to 
run at the usual speed, and if they are ahead of time, to lie and 
v.'ait for the other car. It is conceded that waiting lor trains 
at depots deranges the schedule; on the other hand, it is asser- 
ted that if trains are arriving at the time the cars are leaving the 
station, it would not be good service to proceed and leave the 
passengers to wait for the next car. An extra car has been 
put into service on this line for the purpose of obviating this 
tliitficulty. If any car loses twelve minutes it is called a car's 
time, and such car drops back to the time of the succeeding car, 
and one car is dtopped entirely. If the time lost by any car is 
more than one-half of a car's time, such car is supposed to 
gradually drop back until it has made a full car's time, and in 
that way another car is dispensed with. Conductor's reports 
were introduced in evidence to show that the cars were on dif- 
ferent occasions from two to eight minutes late; and in some 
instances the cars were two minutes ahead of time. Testimony 
further shows that in transferring, respondent gives passengers 
desiring to transfer in the same general direction preference 
over those transferring over a line going in the same direction 
from which such passengers have come; that since only 8 per 
cent of the passengers transfer, it is unfair to hold up 92 per 
cent of the passengers for the benefit of 8 per cent if a car 
happens to be late. From figures taken from the return of each 
line each day, and the car mileage each day from Jan. 1, 1910, 
to July 1, 1910, the proposition of travel on the Johnson Street 
line, compared with Wingra Park line is as follows: Taking 
the Johnson Street or West Main Street line and the Wingra 
Park-Fair Oaks line as its whole system, and leaving out the 
South Madison line entirely, the figures show that 75 per cent of 
the passengers are carried on the Wingra Park line, and 25 per 
cent of the passengers are carried on tlie Johnson Street line. 



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HIBSTAND ET AL. V. SO. WIS. BY CO. 167 

There are 72 per cent of the cars on the former line, and 28 per 
cent on the latter line, and 71 per cent of car mileage is on the 
W'ingra I'ark line and 29 per cent on the Jolinson Street line; 71 
per cent of track mileage is on the VVingra Park line, and 29 
per cent on the East Johnson Street line, but the actual niuiil>er 
of passengers on the Johnson Street line, instead of being 28 
per cent, is only 25 per cent. 

The smallest car seats 22 people ; the next in size 24 people^ 
and tlie semi-convertible seats 32 people; open type cars seat 
45, and some of them 50 people. Trips of 45 passengers in 
either direction on the Johnson Street line average 5 per day for 
a period of six mouths. On such trips, and with the largest 
car in use, 34 people would be seated, and 11 remain standing. 

According to the company's exhibit lor the montii of FeD- 
ruary, it appears thai the smallest number carried on any car 
during the hours given was 45, and the largest number 78 ; and 
for the month of June the smallest number carried on any car 
was 45 and the largest number 105. The time of the lightest 
traffic is between 8:30 and 11:30 a. m. and 8:00 to 10:00 p. m. 
During these periods cars sometimes carry only one or two 
passengers. 

Relative to the cost of operating a car, it was estimated by 
the company that the operating expenses, taxes and depreciation 
amounted to $600 per car per month. Taking the Johnson 
Street line and the West Main Street line as they were formerly 
operated, the company claims that the operating revenues of 
these lines amounted to approximately $3,000 per month. With 
three cars operating over these lines, the operating expenses 
amounted to 60 per cent of the operating revenue. For the en- 
tire system from June 30, 1909, to June 30, 1910, the operating 
expenses amounted to 57 per cent of the operating revenue. 
If four cars had been operated, the cost of the same would have 
be^n 80 per cent of the operating revenue. An examination of 
the records from August 1909 to August 1910 shows an increase 
in the returns on the line as a whole. The increase on the John- 
son Street line, with three cars in service, operating on a ten 
minute schedule, has not been as much per cent as it is on the 
rest of the line. Therefore, the putting on of an extra car has 
not increased the service on this line beyond what the natural 
increase would have been. Taking into consideration the rev- 
enue on the West Main Street line and on the Johnson Street 



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168 RAILBOAD COMMISSION OF WISOONBIK. 

line as it is operated today, with one car running every fifteen 
minutes, as against three cars running every ten minutes, the 
records show that one car running on a slower schedule does 38 
per cent of the business. By this computation it appears that 
the return per month from the Johnson Street section is ap- 
proximately $2,000 ; that by running two cars the operating ex- 
penses would be 641^ per cent of the operating revenues, and 
that by running three cars, as at present, the operating expenses 
would amount to 97 per cent of the operating revenues. In the 
matter of open cars it appears from the testimony that the re- 
spondent has but ten cars of this type on its system, and a large 
number of people are in the habit of riding in the summer time 
merely for pleasure, so that it operates these cars on the longest 
run, which is the Wingra Park-Fair Oaks line. Then, too, in 
case of rain, it is an easy matter to change cars on the "Wingra 
Park line, as the tracks run into the car house; but on the John- 
son Street line it could not make an immediate change unless it 
happened to have a large force of men at its car house at the 
time* 

During the weeks immediately following the hearing fairly 
comprehensive investigations were made by the engineering staff. 
A report covering the results of this investigation has been sub- 
mitted to both parties, and only a few of the more general con- 
clusions arrived at in that report will be adverted to here. If 
should also be noted that the routing of the cars on the East 
Johnson and West Main Street lines has been changed since the 
hearingj and that at the time of the hearing the situation was 
somewhat different from what it was at the time the complaint 
was filed. 

Petitioners objected to the use of certain old cars which the 
respondent ccmpany claimed it was crmpclled to use because 
of its inability to acquire new ones at a more rapid rate than it 
had been ac(]uirini^ them and putting them into service in the 
past. With respect to the use of one or more old cars, it ap- 
pears to us that the public can not reasonably object to such 
cars, provided they are maintained in serviceable condition and 
are capable of doing the work required of them. Both the pub- 
lic and the company will be the gainers if equipment which is 
still in serviceable condition is used as long as practicable and 
not scrapped in advance of necessity. It is obvious that any 



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*I»W^'«ANE> m \h, V. at). WKS. »Y CO, 169. 

^he CQJiO|)a^ cofttribujt^ by. %h^ pAiibUc. 

&A3>n^ia^ ]?^^<PX^ ^dY,^^M2«<l W tfe^ (fOflfipajfty |oif its s^feg^d ij^abiV- 

bwsir^ess of tt^ r^spo^tfit coj|fapai^iy i^ in exc^Ueftl condition.. 
Th^ conp^Ji^y i$^ e^HiiBsg s^a ^xtrwv^ly s;2^ti,aiac4)Qry r^^^ oi ^etu^ 
up£>» t]?# pjrgp^rty (|ey^)ifef4 lo l^ jwblic 4S.^. Tp. bft. sv,r^, it i,s. • 
do^b^le^ b^^viljy l^?^B^dica,pp«d Vy if^s past ftfta^wial W,sto;py^ fo^ 
whict ^Ift© pj?^^J^t ma^|[e|l^at m^kj kvpA V^ fespp^siblie excep.t 
ill s,u i^it ^ i^ h^ yolwt^^y. iuh,<eM|iK'd ^Im^ ?tfew^iV^l <piWH'i^l| 
s^U9(^iQ9 tl^rcH^^ j^urc^^^kSft ^t ^ pri<?€. W^A^fveif ^1?^ Weight 9^^ 
tli^s baiKli^aii^ ip,s^ b^ and vfte^^y^r co^iU^^tioj^ ^| ^n^^y ^seirv^, 
it i^BiVk v^ )m Jr^^Qfiftiz:^ ^A ^ \^U\ bi^sis i^\ ^n akkK•I:«>^ to, pl|e^4 
the financial inability of the company as a reason for not ^d^ 
qv^t^ly se?^vii^ tti^ piJ^^Wic. Tbe c^n^pi^^^. ^ust be coi^^id^^e^ 
financially able to do whatever may reaaoiiaWy be required in 
the interests of good service. 

The superintendent of the resp/pndent comp^^y testified as {pil- 
lows, with reference to the scb^chU^ upo^i wUwU c^rs ^re beii^g 
operated : 

"We make every possible ©flfort we can * * * to main- 
tain that schedule. There isi ua un^ thi|\g that cottUibwK's bP 
much * * * to the returns than to have a car go by a cer- 
tain point every day and hav-e it tun iinie. * =»^ * There £i)r<\ 
it is perfectly natural for us to make every effort to have the 
car theFe. * ♦ * Ev^ry schedule is arr-anged to meet the 
s^WFauf Wd^ i^f^ wh©!^ th© ^-ars ar^ lightly load^ or he^yity 
lo^decl yoy ^x^ either gwng to run ahe^d of S\i^ schedule PV be- 
hind the schedule, unless you Ayatch them all the tinie, and in. 
case of heavy loads you are bound to run behind if your schedule 
is made for the average load. * ♦ * It is utterly impossible 
vvhen the rush comes * * * to keep that schedule up. There 
is iH^ fk Fftilw^Of ift the country that c^t^ do it. unless \\\c schtid\\H' 
in thc5 fif^t placf isdts h^^n arranged on the heavy riding. The^, 
Whw the heavy riding connes. it is the natural schedule; aqd in 
the mc^^ntime the c?irs h^ve all they can do to keep from running 
ahead all the time." 

The difiv5ulty of maintaining a sche(hUc during rush \u\\\xs 
nwst he recognized. It is a real and very seriqus difficulty. 
This appears to be the universal experience in the operation pf 
street railways. B"t the patrons pf the respondent company's 
Ijnes in this city complain net so much with reference to the 



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170 RAn.ROAD COMMISSION OF WISCONSIN. 

company's failure to maintain a rigid schedule during rush hours, 
as because of its inability or failure to operate its cars generally 
in accordance with some known schedule. What the superin- 
tendent testified as being the most important single item in the 
operation of the cars — absolute regularity so that patrons may 
figure on finding a car at a given point at a certain time every 
day — appears to be one of the well established principles, in the 
operation of all railways. All the information which has been 
brought to our attention points to the correctness of that state- 
ment. It is therefore pertinent to inquire what the actual prac- 
tice of the company has been. Many hundreds of observa'tiotis 
were recorded by members of our engineering staff at diflFerent 
street intersections and the regularity with which cars were 
operated is shown in the following summarized statement of re- 
sults : 
82% of the observations are greater than the normal at West 

Washington ave. and Baldwin St., 
73% at East Johnson and North Brearly, 
65% at North Pinckney and East Mifflin, 
76% at West Mifflin and No. Carroll, 
67% at So. Pinckney and East Main, 
87% at the West Madison Depot, 
75% at So. Carroll and West Main, 
48% at East Main and So. Pinckney, 
40% at No. Pinckney and East Mifflin, 
71% at West Main and No. Carroll. 

In other words, out of every hundred attempts to board a car 
at a certain street, the passenger would fail to find a car at that 
point at the normal time in from 40 to 87 times, dq^ending upon 
the particular street corner at which the attempt is made. 

This investigation Ih'id not proceeded very far when it was 
discovered that in the ordinary acceptance of the term no sched- 
ule was, as a matter of fact, in existence. Trainmen apparently 
had fairly definite ideas regarding the headway, but appeared to 
be at a loss respecting the schedule. The essential unreliability 
of the cars, shown by the actual checking of them at diflFerent 
street corners, is sufficient proof that if a nominal schedule had, 
as a matter of fact, existed, there was nothing in the operation 
of the oars to show an appreciable tendency toward its observ- 
ance. It is obvious that the complaint of the petitioners regard- 
ing the failure of the company to observe a schedule is well 



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HJESTAND ET AL. V. SO. WIS. RY CO. 171 

founded in fact. The company can not give satisfactory service 
until it does adopt and adhere to a schedule. 

With a single line track it appears to be difficult to maintain 
a schedule when one car is iheld behind its schedule at a railroad 
crossing or other obstruction. In order to overcome the diffi- 
culties arising out of such delays to cars, a simple manual block 
signal system has been adopted by single track street car lines 
in various cities, and we are inclined to the view that the adop- 
tion of s(Mne such system by the respondent company will be 
necessary before it can give satisfactory service, even after the 
adoption of a good schedule. 

There also appears to exist a lack of definite information on 
the part of motormen an4 conductors with respect to various 
matters connected with the operation of their respective cars. 
This suggests a probable lack of systematic instruction and the 
proper disciplinary superintendence to enforce the reasonable ob- 
servance of rules and regulations. Observations made on all the 
lines of the company show that there is much confusion in the 
boarding and the alighting of passengers. Some conductors 
appear to have some interest in the movement of passengers upon 
the cars, and others do not. Passageways were repeatedly ob- 
served blocked and platforms overcrowded, without attracting 
the attention of the conductor or calling forth from him any sug- 
gestion to passengers by which the situation might be relieved. 
It is well known that the handling of i>assengers on cars is one 
of the most important factors in maintaining the schedule. This 
is a matter of mutual education on the part of patrons and train- 
men. There can be no doubt regarding the desire and ability of 
the old and experienced men employed by the respondent com- 
pany to observe rules and regulations and to live up to instruc- 
tions in every way. If these men do not observe rules and reg- 
ulations and instructions, it must be because such rules, regula- 
tions and instructions have not been brought to their attention 
with sufficient clearness and emphasis. In the case of new men, 
it doubtless requires persistent instruction on the part of the 
management. This is unquestionably one of the leading func- 
tions of the management. The facts gathered by our own engi- 
neers and the testimony of the petitioners seem to show that in 
this respect the management has possibly not done all that may 
reasonably be expected of it. We believe that with proper di- 
rection and instruction the present trainmen can readily be in- 



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172 RAILBOAD COMMISSION 09 WISOOiCSnf. 

doced to opetMt the cars with mttcb greater regnlaiity and 
satisfaction to the publk than they are now being operated. 

We think the compdny should at once woik out a. sehednle and 
properly publish it, so that its patrons may know when they may 
reasonably expect to find a car movif^ in a certain direction a£ a 
certain point. We recooimend to the company a yery careftil 
investigation of the expediency of installti^ some signaling sys- 
tenoi by which trainnoen may conifey to one another information 
regarding the nK>veniieiit and location of tlieir respective cars^ 
whenever for any' reason cars are not running in accordance with 
the schedule. 

It is THJaoEFOKE Obdered^ That the respondent, the Sonthern 
Wisconsin Railway Company^ publish a proper train schednk 
and make the same reasonably accessible to the patrons of its 
lines, and operate its cars accordingly. 

Ten days is deemed a sufficient time within which to oomply 
with this order. 



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LA CROSSE WATER POW1CR CO. 17. C. ST. P. M. & O. R. CO. 173 



LA CROSSE WATER POWER COMPANY 

vs. 
CHICAGO. ST. PAUL. MINNEAPOLIS AND OMAHA RAILWAl: 
COMPANY. 



Decided Bee. 15, IVW, 



Petition alleging unusual and exorbitant charges tor awitchiog eleven 
Q&TloadB «f •coBstrQCtlon material from Columbia to '^end of 
trade'' St Wedges Oreek icL Tbe faute oosftesded ter ima 
made effiectlve after the shipments had moved. 

BeJd: That the 'Charges exacted -were unusual and exorbitant and re- 
f uBd -endfered. 

The petitioner in the above -case is a dispenser oi electric ligld; 
and power and ias its principal office at La Crosse, Wis. It 
alleges that on and between May 21 and June 11, 191Q, it shipped 
eleven carloads of construction material over the respondent's 
line. All of the above cars wer-e switched from NeiUsvillc, Wis., 
to Columbia, thence to the end of the track at Wedges Creek 
Gravel Pit, and consigned to the La Crosse Water Power Com- 
pany, at which point the material was to be used in the constnic- 
tion of a dam. 

The petitioner further alleges that it paid $208.91 freight 
charges on the above shipments ; that this charge is unusual and 
exorbitant, and that the rate should be on the basis of the tariff 
G. F. D. 2107, which provides a charge of $5 per car for switch- 
ing same from Columbia to end of track, Wedges Creek Gravel 
Pit. 

Wherefore, petitioner prays that the railway company be au- 
thorized and directed to refund to it the sum of $153.91, the 
amount charged in excess of $5 per car upon the aforesaid ship- 
ments. 

The respondent, answering the petition, admits that the above 
cars of material were switched and rates charged therefor as 
alleged, that the tariff of $5 per car on material from Columbia 
or Wedges Creek to end of track was made to become effective 
June 19, 1909, after knowledge that material was being shipped 



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174 BAILBOAD 00MMIS6I0N OF WISCONSIN. 

to that point ; that respondent was not advised that the petitioner 
desired to move material thereto until after a number of said 
shipments had moved ; that upon receipt of this advice respond- 
ent immediately put into effect a $3 per car tariff; and further 
alleges that it is willing to make refund to the plaintiff if author- 
ized to do so. 

The claim was submitted upon the pleadings, vouchers, docu- 
ments and schedules on file. 

The facts in this case are identical with those in La Crosse 
Water Power Co. v. Chicago, St Paul, Minneapolis & Omaha 
Ry. Co. 4 W. R. C. R. 412, and the claim here presented is there- 
fore controlled by that case. 

We therefore find and determine that the charges exacted of 
the petitioner for transporting the eleven cars of construction 
material from Columbia to "end of track" at Wedges Creek Jet., 
are unusual and exorbitant, and do find that the reasonable rate 
that should have been charged for such services is the sum of $5 
per car, as provided in tariff G. F. D. 2107 now in effect. 

Now, Therefore, it is Ordered, That the Chicago, St. Paul, 
Minneapolis & Omaha Railway Company be and the same is 
hereby authorized and directed to refund to the La Crosse Water 
Power Company the sum of $153.91, being the amount paid to 
the said railway company by the said company in excess of the 
charge herein found reasonable for the aforesaid transportation 
service. 



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PULPWOOD CO. OP APPLETON V. M. ST. P. 4b S. S. M. R. CO. 175 



PULPWOOD COMPANY OF APPL.ETON 

VS. 
MINNEAPOLIS, ST. PAUL AND SAULT STE. MARIE RAILWAY 

COMPANY, 
CHICAGO AND NORTH WESTERN RAILWAY COMPANY. 



SubtnMted Nov. 10, 1910. Decided Dec. 16, 1910. 



Petition alleging Illegal charges on shipments of sixty-two carloads 
of pulpwood from northern Wisconsin points to Appleton and 
Klmberly, Wis., respondent having raised such rates on pulp- 
wood subsequent to and In violation of the order of the Com- 
mission in Pulp cC- Paper Mfrs. of Wis, v. O. d N. W. R. Co. ei 
al. 2 W. R. a R. 168. 

Held: That the shipments moved more than six months prior to the 
filing of the complaint herein and the Commission is therefore 
without Jurisdiction. Petition dismissed. 

The petitioner is a corporation engaged in the purchase and 
sale of pulpwood, at Appleton, Wis. It alleges that between 
Feb. 15, 1908, and May 18, 1908, sixty-two cars of pulpwood 
were shipped from Abbotsford, Dorchester, Stetsonville and 
Mellen, "Wis., to petitioner at Appleton and Kimberly, Wis., for 
which it was charged rates in excess of the lawful rates applica- 
ble to such shipments ; that on Jan. 9, 1908, in the case of Pulp & 
Paper Manufacturers of Wisconsin ?•. Chicago & North Western 
Railway Company et al. 2 W. R. C. R. 168, an order was made 
and entered by the Commission fixing the maximum rates to be 
charged by the various railroads in Wisconsin, and among other 
things providing that "neither the order nor the recommendation 
herein shall in any way apply to or change any rate now in eflfect 
that is lower than the rates provided by said order ;" that on said 
Jan. 9, 1908, respondents had in effect and were charging rates 
between the points above referred to which were lower than the 
rates provided by said order of said Commission, but that after- 
ward and on, to-wit: the dates of said shipments above referred 
to, said respondents, in violation of the Commission's said order, 
raised said rates, as shown by their tariffs, to the damage and 
injury of petitioner in the sum of $374.40; that on July 28, 1908, 
claim for reparation was duly riled with the Wisconsin Central 



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17^ ^AlUROAD COMMISSION tJf WISOONfllN-. 

Railway Company, predecessor of the Minneapolis, St. Paul & 
Sault Ste. Marie Railway Company, which claim was declined 
and returned to petitioner on June 4, 1910. Wherefore, peti- 
tioner prays that the respondents be authorized arid directed to 
refund to it the said sum of $374.40. 

The answer of the resport^Wt -MiA'ne'iipolfe, ^. iPii*^ •& 'SaWlt 
Ste. Marie Railway Company, after admitting all ttih formal 
illcgatuMis of 'tlie petition afid set'ting fortli certain i'rWfccnn'aLcie.s 
alleged to tie <C(^«ii*n<!?d Wi^td*, -iiArrfts that *: ^h«d -M *#ec?t t^^^s 
lower than those charged, as set forth in the petition, and also 
lower than the rates provitkd by *lie 'oixiet of the Ccwnmission 
referred to in the petition. It itMtfeer alleges that subsequent 
to said order sajid "rates were -advanced i*i ha*nrt6ny wkli the ^aW 
Tk^s 'fiy^ 1>y HHt 'Cotfffttf ss 'idfi by taViWs (inly file'A a's Required 
by law-, ^a^n^ tl-re safcl ^hirinren-ts ccmiplaificd cA were *r)a<^e in ac- 
c6r5a'm<e ^^ith 9lii<i tariffs. It 'defies ¥hat tht ftliWg 'of s^id tariffs 
or the making of said charges was in any fc^ar^ i« violation erf 
1*^ 'c^t^T -of ^!ht OoH^^nTOsioft or aM 'p^ovisiofh 'C^ the 'statutes of 
the state of Wisconsin. Wherefore, sai(i respondent prays that 
the petition Ix^ dismissed. 

The respondent, the Oiicago & North Western -Railway Com- 
pany, answering t'lie petition herein, admits that the various sh^- 
ments of pulpwood were handled by it between Feb. 19 and May 
18, 1908, but says that it has not been able to check over all the 
shiptnents which are listed in the .petition and can not, therefiM^ 
answer as t() whether eai^h and ev*ery srhipmcnt moved as therein 
stated ; but it alleges that said shipments tnoved much more thati 
six months .prior to the •filing oi j^atd complaint, and that this 
Commission, tlierefore, is without jurisdiction to hear and con- 
sider the claim .presented by the ix^itimier for reparation 'on said 
shipiTients. Where-fore, respondent prays that the complaint be 
dismissed. 

The matter came on for heari-ng on Nov. 9, 1910. Petitioner 
was represented by Felix 7, Strcyckmans, its attorney. The re- 
spondent Minneapolis, St. Paul & Sault Ste. Marie Railway 
Company was not represented. The Chicago & North Western 
Railway Company was represented by F. D. Fulton, its 'attorney. 

The investigation disclosed that all the shipments involved in 
the claim presented moved and reached their destination more 
than six months prior to tlie fiUng of the claim with the Commis- 
sion as provided by law. We -may concede, without deciding 



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PULP WOOD CW. OP JUWTJBTON ^. m. «». P. « S* S. JM. R. CO. 177 

the point, that respondents exacted of the petitioner, for such 
shipments, rates in excess of those established by the order of 
the Commission to which reference is made in the petition. Ii 
follows from such concession that such rates were assessed and 
collected in violation of the statutes, and hence were illegal. A 
penalty is provided for any such infraction of Iscw by a railway 
con\pan.y. But an iajured shipper, in order to obtain rel el in a 
case such as is liere presented, must pursue his remedy in the 
manner prescribed by the staitute. He is not permitted to sleep 
upon his rights VnT?l tits rttttedy fe baTreA ktii iheti 'seek to en- 
force the same. The statute "here invoked reads as follows: 

"WftMm six fliion1?bs after *the 46Kvery of any 'shipmen-t nrf 
ptiffftttfr «t ^dfertftatfeto, 'my ^p^fscto afggrteVefl «iay ^siwttplain to 
me C<!tomir^oA ^rft tire chatge e^xac'tcd icfr iht 'tratri^portation 
oi s%ioh ^Qpw^y T?)etween points in \Visconsin * * * is er- 
fH5*c0tts, ill^gafl, liiwstdffl df ^xdrblt«a(nt, aird tbereiipon the Com- 
ifisyim 'sfliafFl have ^6^tT to inv^s^ate ^ch 'cofttpla^Jftt, and to 
yt^kf \}ft 'satfwe, "ktid to deei<5e upofi the merits thereof,''' 'etc. 

As the claim was not filed with the Commiss^ictfi vftMi Sep. 24, 
1910, more than two years after the shipments in question 
reac^eS tlieir destination, tTie ICommission is without jurisdiction 
to entertain same, and tlie petition must be dismissed. 

Now, TuEftiEPcmE, Y*r LS '(TfeDERED, That the petition herein *ht 
and t*he same is ^ere'by dismissed. 
12— R. D. 



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178 RAILROAD COMMISSION OP WISCONSIN. 



A. H. KROUSKOP 

vs. 
CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY. 



Submitted Dec. IS, 1910. Decided Dec. 23, 1910. 



Petition alieging that the minimum weight applied on a carload ship- 
ment of bulk rye from Blue River, Wis., to Richland Center, 
Wis., was unjust and unusual; and that the rate of 8V& cts. 
per cwt, exacted for said shipment, was exorbitant 

Held: That the shipper made no demand for any particular sisse car 
and was therefore bound by the minimum loading require- 
ment for the car furnished; that said minimum loading re- 
quirement was reasonable; that the rate exacted was exorb- 
itant, and respondent is ordered to substitute therefor a rate 
of 6^ cts. per cwt. Refund ordered on the basis of such re- 
duced rate. 

The petitioner is a dealer in lumber, grain and other ccMnmodi- 
ties in the city of Richland Center, Wis. He alleges that on 
Aug. 22, 1910, a carload of bulk rye, weighing 26,400 lbs., was 
shipped by him from Blue River, Wis.; that he purchased said 
rye on the supposition that 30,000 lbs. constituted a minimum 
carload ; that the respondent charged him freight on 44,000 lbs. 
at an 8V2 ct. rate; that the respondent, in making a minimum cf 
44,000 lbs. on bulk rye, carload shipments, makes an unjust 
and unusual minimum loading, which should be reduced to not 
above 30,000 lbs.; and that 8i/^ cts. per cwt. for shipments of 
grain over a distance not greater than the distance from Blue 
River lo Richland Center is exorbitant. Wherefore, petitioner 
prays that the minimum loading requirement of shipments of 
rye in carload lots be reduced to 30,000 lbs., and that the rate be 
reduced to a reasonable basis, and a refund ordered upon such 
basis. ' ' ; . . 

The respondent railway company, answering the petition 
herein, alleges that it has not been able to verify the movement 
of the shipment set forth in the petition or the basis of it, but 
avers that if the shipment moved as the petition alleges, the 
proper and lawful rate to have been charged was the rate of 8^^ 
cts. per cwt., which is just and reasonable for such transportation. 



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KBOUSKOP V. C. M. A ST. P. B. CO. 179 

As to the minimum alleged to have been applied on the car, the 
respondent alleges that graduated scales of minima are in effect 
according to the capacity of the cars which are used, and while 
the petition does not set forth the number or capacity of the car 
used, the respondent believes that the minimum which was ap- 
plied was the proper, lawful minimum applicable to the size of 
the car furnished, and denies that the said minimum was unjust 
or unreasonable, and denies that the petitioner has been over- 
charged in any sum upon the shipment if it moved as in said 
petition alleged. 

The matter came on for hearing on Dec. 13, 1910. The peti- 
tioner was not represented. The respondent was represented by 
William Ellis, its commerce counsel. 

The distance f rc^n Blue River to Richland Center is 34.2 miles. 
Respondent's tariff G. F. D. 6500^a, effective Aug. 3, 1900, and 
still in force, establishes a rate on rye between stations on the 
respondent's line in Wisconsin for distances of thirty-five miles 
and over thirty miles of 81^ cts. per cwt., subject to minimum 
weights provided in tariff G. F. D. 2700 — a, effective Jan. 1, 
1907, and still in effect. The latter tariff provides for minimum 
weights on grain according to the capacity of the car used. 

For a 50,000 lb. capacity car the minimum provided for rye is 
44,000 lbs. The car in which the grain in question was shipped, 
No. 45,470, is a car which has a capacity of 50,000 lbs. 

In tariff G. F. D. 2700 — a is contained the following instruc- 
tion to agents : 

"Minimum weights to be used in large cars where small cars 
are ordered. When cars of certain dimensions are ordered by 
shippers for loading at your station, which you are unable to 
furnish, the following rule may be used : Immediately upon re- 
ceipt of the order, you are to notify train dispatcher by letter, 
or wire if necessary, of the number and length of cars wanted 
and the length or capacity of any empty cars available for this 
loading which you may have on hand. Should he authorize you 
to use cars of greater length or capacity than those ordered, you 
will note this information on way-bill, and way-bill accordingly. 
This notice will be receiving agent's authority to accept weight 
as billed. A copy of your message to the train dispatcher and 
the original reply received from him must be attached to the 
way-bill, and these messages will constitute auditor's authority 
to pass bill accordingly. These instructions should not be con- 
strued as allowing agent to pass shipments at minimum weight 
for the size cars ordered when the actual weight is in excess of 



Digitized by VjOOQIC 



180 



KAU^OAD COliAUSSION OF WJKSCONSiK. 



such minimum, ^nd should in no way iiaiterfere with cxistii^ 
instractions in reference to weight" 

TPhc Tnmirmwn wcig'hts on T}x% for tl>c Tarious sized cars, as 
pwvwled hy tl« tariff referred to at)ove, G. F. D. 2700 — a, are 
as jfoJtows: 

Whom capacity of oar is not marked. fliin4iii«m 24»000 £bs. 
W%re«i maa^ed 'ca-pactty di car Is 



28,0a0 Tbs., 


minimum. 


26,000 lbs 


W,§0# " 


« 


34,^W0 ^ 


SO, 000 •• 


<< 


44.0t0 *' 


'60,000 " 


« 


54,000 *•• 


80,000 •' 


« 


72,0«* - 


90,000 " 


It 


«1,^0 ^ 


100,000 ^ 


'« 


BO, 000 " 


iu,eoo - 


<M 


i«oe,wo - 



The western classification No. 48, effective May 1, 1910, aad 
in effect on Aug. *22, 1910, when the shipment in question moved, 
a^fl j^iTl m effect, provides for grain in bags, boxes or harrels ^t 
dass B ra;tes, wifli a minimum loading provision oT 40,000 lbs. 
per car. The class B rate for distances of thirty-five miles is 
6% d:s. II the shipment in question had heen sacked instead of 
beirrg in hutk, class B rates would have applied, and flierefore 
the charge would have been $28.60, or $8.80 less than was actu- 
ally paid. 

An examination of tlic respondent's grain rates within this 
^a*te *for various distances show as follows : 

TLCrtm, TVITEA'T. COTIN. OATS. BARLEY, UYE AND MlLl.STFFFS. 



4tetwe0n 


and 


Miles. 


1 

Rate C.Ji.&St.P. 
Cts. 'G.T.T). No. 


MausUm 

Roekl»ttd. 

MflmstfOn . . - . 


Nrcoclah 


32.8 
25.8 
26 ;6 

38.2 

40.2 
46.5 
49. .3 
49.9 
63.0 
54.3 


6 3280 


Tointth .. 


6 , 
6 

7-4 

7j . ; 

7 [ 
7 1 

I ; 




Bansror 

WfAt^AAkim . . 




> > 




Mpftarv 


• » 




TjA. Oiyvma 


♦ • 




Onft 1 a$»ka 


Grund IteDlrki. 




TfflUfth 




Naw Lisbon 






TutinAl'Oltv 


it » » 




OaUd^le 

Camp'Pouiarlas 


t ( 1 1 




" 





CORK . iirV K, •( > A TS AKT) nATCTvE^'. 

From Muftrodn to Blchlanfl Oorttor, 1J7.8 mi]^. ratt^ ^k;, <;;. F. h. "No. »W3-B. 
Between AnpUjtoii and Oconto, Iwnley S1.5 miles, rat-e 6c, (i.F. I). No. 20Q3-B. 

T.ti the 'instamt case the shipper made no demand for aTry par- 
ticular size car. lie is therefore bound by the minimum loading 



Digitized by VjOOQIC 



KROUSKOP V, C. M. & ST. P. R. CO. 181 

requirement for the car that was furnished by the respondent. 
The contention that the minimum loading requirement should be 
reduced to 30,000 lbs., regardless of the size of the car, is un- 
reasonable. The rules and regulations relative to the ordering 
and furnishing of cars ar€ reasonable ones^ and the sai&inia ftf^ 
scribed for the various sized cars in use in the respondeat's tariff 
above set forth are not uniiecessanlj bnidefisjOJODie lapon stdppexs. 
Experience has demonstrated that these requirements are just 
and should not be disturbed. If the shipper desires any particu- 
lar sized car, it is his duty to order the same. In the absence 
of such order the carrier is permitted to furnish such car as it 
has aYailaUe for the transportation in question. 

Obviously, the rate exacted for the shipment in question is 
exorbitant. No higher rate should he penmitted than that pro- 
vided in class B of the western classification. The rate in ques- 
tion is out of line with other rates in this state for approximately 
the same distance. There is nothing in the cost of Iransporta- 
tion between the points between which the shipment under coch 
sideration moved, which would justify such a disparity of 
charges. In o^npnting the cost of transportation involved in 
the claim here presented, it appears that S^ cts. per cwt. is an 
nmisual charge and yields a lar«:tT return to the carrier than the 
situation warrants. A rate of 6*/4 cts. per cwt, woald have bee© 
ample compensation for the service rendered io transportirig rye 
in carload lots from Blue River to Richland Center. 

Now, Therjbvore. it is {)ri>k»ki>. That <he res|)omlent, the 
Chicago^ Milwaukee & St, Paul Railway Company, shall cease 
and desist from charging any higher rate than W^ cts, per cwt 
for rye shipped in bulk in carload lots frc«n Blue River, Wis,, 
to Richland Center, Wis., and that the said respcmdent shall sub- 
stitute in place of the 8% ct. rate per cwt., in effect for siKb 
shipments, the rate of 6% cts, per cwt. 

It is Further (>rpkrej\ That the resjx>mfent refund to the 
petitioner the sum of $8.80, being the ainaunt herein found to 
be in excess of the reasonable charge for the aforesaid shipment. 



Digitized by VjOOQIC 



182 RAILROAD COMMISSION OP WISCONSIN. 



PHOENIX WALL PAPER MANUFACTURING COMPANY 
vs. 

MINNEAPOLIS, ST. PAUL AND SAULT STE. MARIE RAILWAY 
COMPANY. 



Decided Dec, 28, 1910, 



Petition alleging overcharges on two carload shipments of print paper 
in rolls from Rhinelander, Wis., to Stevens Point, Wis. The 
rate contended for was in effect on competing lines and was 
later also made effective by respondent. 

Held: That the rate exacted was unusual and exorbitant; refund or- 
dered. 

The petitioner, the Phoenix Wall Paper Manufacturing Co., 
IS a corporation engaged in the manufacture of paper at Stevens 
Point, Wis. It alleges that on July 13, 1910, it shipped from 
Rhinelander, Wis., to Stevens Point, Wis., over the respondent's 
line, one car, No. 81348, containing 38,300 lbs. print paper in 
rolls, and on July 14. 1910, one car. No. 30878, containing 38,400 
lbs. of like paper; that respondent assessed charges at the rate 
of 10 cts. per cwt., which amounted to $38.30 on car No. 81348, 
and $38.40 on car No. 30878 ; that, relying upon the respondent 
having in effect from Rhinelander to Stevens Point, over its own 
rails the entire distance, the same rates as carried via other 
routes requiring haul over two railroads, forwarded these ship- 
ments via the respondent's line instead of via the other routes; 
and that respondent has, subsequent to these shipments from 
Rhinelander, published rate of IV2 cts. per cwt. to Stevens 
Point, the same as carried by other lines, in its tariff G. F. D. 
12365, issued under special permission of the Commission, Aug. 
8, 1910, taking effect Aug, 19, 1910; that the charges assessed 
by the respondent on the above two cars are excessive and un- 
reasonable; and therefore petitioner prays that reparation be 
made to it in^the sum of $9.57 on car No. 81348 and $9.60 on car 
No. 30878. 

No answer was filed by the respondent. The claim was sub- 
mitted upon the pleadings, papers, documents and vouchers on 
file. 



Digitized by VjOOQIC 



PHOENIX WALL PAPER MFG. C50. V. M. ST. P. A S. S. M. B. CO. 183 

The above claim is based substantially upon the same facts 
and circumstances as those considered in the case of Menasha 
Paper Co. v, C. M. & Si. P. R. Co, et al. 3 W. R. C. R. 620, in 
which case it was said : 

"In the instant case the respondents established a 6 ct. rate 
immediately after shipment in question moved, which rate has 
been in force ever since and is still in force. They must have 
regarded such rate as reasonable, and we are disposed to agree 
with them. Under the circumstances such rate must be taken 
as the basis upon which reparation may be awarded." 

For the reasons given above, we find tliat the rate of 10 cts. 
per cwt. for the above shipments of print paper from Rhine- 
lander to Stevens Point, Wis., is unusual and exorbitant, and 
do further find that a reasonable rate for the service rendered 
the petitioner in shipping the said shipments of print paper would 
have been 7% cts. per cwt. The excessive charge, therefore, 
amounts to $19.17, and authority will be given the respondent 
to refund that amount to the petitioner. 

Now, Therefore, it is Ordered, That the Minneapolis, St. 
Paul & Sault Ste. Marie Railway Company refund to tlie said 
Phoenix Wall Raper Manufacturing Co. the sum of $19.17, being 
ing the amount paid by the Phoenix Wall Paper Manufacturing 
Co. to the said respondent in excess of the amount herein deter- 
mined to be a reasonable charge for the transportation services 
by the said respondent as aforesaid. 



Digitized by VjOOQIC 



iH ^vMSM^ e(mw^vx!fi o» v«0OMSiNf. 



A. H. I»OIT«KOP 

OHICACK), MltWAURKB ANR ST. PAUL IkAtUWAY CJ^ilMIPAM?. 



Submitted Dec. 1», 1910, Decided Dec. SO, 1910, 



P^lllcMl «ttesln8 an •xoi^tU^at a^d unlviat rale oa a oarloafi akIpBMtIt 
Ql Umto- Irofli RlcUlattd Cente? . Wkt, t(H PyaUrle ^u Sac>, 'Wift-n 
auC praying (1) that said rate be reduced* and (2)^ th^t ^ 
refmicl be oKtored. 

U^ld: (1) Tbat tJUe xute ei^acted ^as u^iusJ^ awl iaM*ea3QA8^M« 9»/k 
respondent is ordered to substitute a lower rate therefor; (2) 
tlkat %^ ahipmeat Kkenltoned herein paved H^re than ate 
<aoj»tha prior to the lUUns; o| the coxo^aiv^^ (q tl\vii caae m4 
the claim Is therefore barred by statute. 

The petitioner is a dealer in htmber, grain and alher commodi- 
ties at the city of I^ichland Center, Wis. He alleges that on 
March 5, 1910, be shipped a carload of lumber from Richland 
Center, Wis., to Prairie dii Sac, Wis., billing the same on th# 
assun>pti(>n that the rate on hunber in oarK>ad lo>ts ti> Pra'rie du 
Sae would not be nKxre than the rate al & cts. per cwt., then in 
effect on like shipments between Richland Center and Madisoii; 
that the charge of ly^ cts. per cwt. is exorbitant and unjust, and 
the same should.be reduced so as not to exceed the rate on lum- 
ber in carload lots in effect between Richland Center and Madi- 
son at the date of the shipment of the above mentioned car; and 
that the respondent should be required to refund the amount it 
has charged in excess of the Madison rate ; wherefore, petitioner 
prays that the rate in question be reduced and that a refund be 
ordered accordingly upon the shipment above mentioned. 

The answer of the respondent to the petition herein denies the 
jurisdiction of the Commission to award reparation in this case, 
inasmuch as the shipment moved more than six months prior 
to the date of filing of the claim with the Commission. It also 
denies that 'the rate as charged was unjust or unreasonable, or 
that the rate of 5 cts. per cwt. would have been a reasonable rate 
to have been applied to such shipment ; wherefore, the respond- 
ent prays that the petition be dismissed^ 



Digitized by VjOOQIC 



KftOUSKOP t;. C. M. A, ST. P. ft. 00. 



185 



The matter came on for hearing on Dec. 13, 1910; the peti- 
tioner was not represented; the respondent was represented by 
tVilliam Ellis, its commerce counsel. 

The claim was submitted upon the pleadings, vouchers, docu- 
ments and schedules on file. 

It appears that the shipment in question reached destination 
more than six months prior to the filing of the claim with the 
Commission. The claim is therefore barred by the statute. In * 
making claim the petitioner acted upon the erroneous assump- 
tion that the date of the payment of the freight started the run- 
ning of the statute. However, the petitioner attacks the reason* 
ableness of the rate that was exacted and prays that the same 
be reduced. It will be necessary, therefore, to pass upon the 
merits of the petition respecting the reasonableness of the rate 
in effect between the points the shipment in question moved. 

Respondent's tariff G. F. D. 66500— A, effective Aug. 3, 1908, 
and still in effect, provides a rate of 7^ cts. applicable to ship- 
ments of lumber from Richland Center to Prairie du Sac. This 
tariff is the local distance tariff on classes and commodities be- 
tween all stations in this state on respondent's lines. The ly^ 
ct. rate on lumber applies upon shipments for distances of 50 
miles and over 45 miles. The distance between Richland Center 
and Prairie du Sac is 46.1 miles. 

An examination of the respondent's tariffs in effect in this 
state shows that rates on lumber between various points on re- 
spondent's lines in effect on March 5, 1910, and still in effect, are 
as follows: 



C. M. A St. P. 
Tariff No. 


Between. 


And. 


Miles. 


Rate. lbs. 


51002 


Mauston 

Tunnel City 


Tomah 


25.8 

.34.5 

.36.3 

44. fl 

47.5 

53 

33.9 

57.7 

61.8 

62.3 

26.1 

41 .» 

42.8 


h\ 




Necedah 


6 




Lyndon 

Kilbourn 


Tomah 


6 




Tomah 


6i 




Sparta '.... 


Necedah 


6 




Lewlston 


Tomah 


6i 




Rockland 


Necedah 


6 




Bangror 


Necedah 


6 




Portaflre 


Tomah 


6i 




West Salem 


Tomah 


7 


&900 A 


Mel Vina* .* ...... W'.'....'... . 


laa Crosse 


5 




Onalaska 


64 




Tunnel City 


Onalaska 


6i 












From 


To 






51000 


Richland Center 

Richland Center 

Wauzeka 


iVladison 


58.9 
96 2 
120.6 
42.5 
47.9 
.52.6 


5 




Watertown 


5 




.lanosville 


7i 


8000A 


Tomah 


Lia Crosse 


6 




Olrard Jet 


Lena 


6 




Girard Jet 


Stiles Jet 


Oi 











Digitized by VjOOQIC 



186 RAILROAD COMMISSION OP WISCONSIN. 

"While a comparison of the rate in controversy with other 
rates does not in and of itself establish the unreasonableness of 
the former, yet, where conditions are not dissimilar and the cost 
of transportation is no greater, it would seem that the variance 
in the rates is not justified. However, a consideration of the cost 
of transportation of lumber between the various points above 
mentioned and that between Richland Center and Prairie du Sac 
discloses that the former rates are reasonably compensatory and 
that the latter rate yields an excessive return. It also appears 
from such consideration of the subject that a rate of 5^^ cts. 
per cwt. is adequate and reasonable for shipments of lumber in 
carload lots between- Richland Center and Prairie du Sac, and 
therefore the rate exacted of the petitioner is unjust and unrea- 
sonable. 

Now, Therefore, it is Ordered, Tliat the respondent in this 
case, the Chicago, Milwaukee & St. Paul Railway Company, dis- 
continue its present rate of 7^/^ cts. per cwt. on lumber in car- 
load lots shipped from Richland Center, Wis., to Prairie du Sac, 
Wis., over its lines, and that it substitute therefor a rate of 
5y2 cts. per cwt. 



Digitized by VjOOQIC 



In re appl. interurban tbl, co. 187 



IN RE APPLICATION OF THE INTERURBAN TELEPHONE COM- 
PANY FOR AUTHORITY TO INCREASE RATES. 



SubnUitcd Nov. 22, 1910. Decided Dec. 80, 1910. 



Application for authority to increase rates, involving the exchanges at 
Sun Prairie, Waterloo and Lake MllJs, tor lue purpose oi enaL>- 
ling the applicant to earn a reasonaole return on the capital 
Invested, to create a depreciation fund, and to meet the in- 
creased cost of operation. An analysis of the revenues and 
expenses and a valuation of tne property of the applicant show 
that the applicant is entitled to the increase In rates for which 
it has applied and it is authorized to put the same in effect 

The applicant in this case, the Interurban Telephone Company, 
is a company with its main offices in Madison, and which operates 
telephone exchanges in Sun Prairie, Waterloo, and Lake Mills. 
The hearing in this matter was held at the office of the Railroad 
Commission, Nov. 22, 1910, at which the following appeared: 
For the applicant, C. A. Engsberg and A. C. Hoppman, president 
and treasurer, respectively, of the Interurban Telephone Com- 
pany. For some of the Waterloo patrons, Ray C. Tunning. No 
appearances were made on behalf of the patrons of Sun Prairie 
and Lake Mills. 

The application for authority to increase rates shows that the 
applicant had in effect, April 1, 1907, the following schedule of 

rates: 

Per month 

Business 'phones, all kinds $1.25 

Residence 'phones, in city, all kinds 1.00 

Rural farmer 'phones 1.25 

Extension 'phones 75 

Extension bells 15 

The reasons stated by the applicant for desiring to increase 
rates are: 

(1) To enable the company to earn a reasonable return on the 
capital invested. 

(2) To create a depreciation fund to replace the plant when 
necessary, 

(3) To meet the increased expense of operation caused by the 



Digitized by VjOOQIC 



188 RAILROAD COMMISSION OF WlSCONSIK. 

increase in service rendered, which has been made since the above 
rates were estabhshed. 

(4) To meet the increased expense of operation which has re- 
sulted from connecting with the long distance lines of the Wis- 
consin Telephone Company. 

(5) To meet the increased cost of labor, materials and sup- 
plies. To accomplish these purposes the company proposes to 
put in effect the following schedule of rates: 

Per month 

Single line business 'phones |2 . 10 

Two party business 'phones 1.80 

Single line residence 'phones 1 . 50 

Two party residence 'phones 1 .25 

Pour party residence 'phones 1.10 

Rural or farm line 'phones 1 .35 

extension 'phones 85 

Extension bells 25 

A reduction of 10 cts. per month is to be made from the 
above schedule if payments are made before the 15th of each 
month. No increase in toll rates is planned. 

The Interurbau Telephone Company was organized in 1900, 
and the original system consisted of tlie properly of the North 
and East Bristol exchange, whicli was acquired by purchase. 
Later the property of the Lake IVlills exchange was purchased. 
These, with the additions which have since been made, con- 
stitute the system of the applicant. 

The testimony showed that the company had issued bonds to 
the amount of $25,000 in 1905, and that v$20,000 of these bonds 
are at present outstanding. The capital stock of the company 
consists of $75,000 of preferred stock, of which $69,800 is out- 
standing. The book value was stated as $123,000, but the repre- 
sentatives of the company stated that, in their opinion, $90,000 
was a fair value of the property involved. The surplus of re- 
ceipts over operating expenses was slated as follows : 

For 1907 14,566.91 

For 1908 4,403.99 

For 1909 5,651.50 

On the basis of the valuation of $90,000, claimed by the com- 
pany, this would yield a return for interest and depreciation of 
from 4.9 to 6.3 per cent. The increase )in rates, as calculated by 
the president of the company, it was testified would amount to 
about $2,275 per year, which would increase the rate of return to 
a little less than 9 per cent. 



Digitized by VjOOQIC 



In re appl. intebubban tbl. oo. 189 

It appears that interest on the bonds has been paid regularly, 
but that no dividends have been paid since 1903. The company 
also states that $2,000 per year is needed, either to provkJe a 
sinking fund, as provided for in the bond issue, or for purposes 
of construction, and that if this is provided for in addition to 
depreciation and interest, a surphis above operating expenses of 
$11,588 per year would be needed. 

The subscribers of the Interurban Telephone Company are lo- 
cated, with reference to the three exchanges, as follows: 

Sun Prairie 275 subscribers 

Waterloo 335 

Lake Mills 374 

Total 984 

At Sun Prairie the company has a self -restoring drop switch 
board of 200 capacity, at Lake Mills a Kellogg board with 300 
drop, and at Waterloo a Standard board of the same capacity as 
the board at Sun Prairie. At Sun Prairie and Waterloo a com- 
mon return system is in use, but at Waterloo residence 'phones 
are all metallic, and at Lake Mills most of the lines are metallic, 
although there are a few grounded lines. 

Some testimony was introduced to show that rates as charged 
at present are lower than the rates for similar service in other 
localities, but no careful comparison of operating conditions was 
made. 

Such additional facts, and investigations bearing upon the 
proposed increase as made by the Commission, are summarized 
below. A valuation has been made by the engineers of the Com- 
mission from an inventory filed on Dec. 10. The company states 
that while this inventory is not absolutely correct, it is as nearly 
so as possible without a piecemeal re-check of the entire prop- 
erty. From table I it appears that the cost to reproduce the prop- 
erty new will aggregate $70,610. Of this amount $21,181 is 
placed as the value of the I-ake Mills exchange, $16,273 as that 
of the Waterloo exchange, $12,696 as the value of the Sun 
Prairie exchange, and $20,460 as the value of connecting or toll 
lines. Facts relating to the financial condition of the company 
have been gathered from the reports placed on file with the Com- 
mission for the years ending June 30, 1900, and June 30, 1910. 
The balance sheets and income account for the property as a 
whole are shown in tables II and III. 



Digitized by VjOOQIC 



190 RAILROAD COMMISSION OP WISCONSIN. 

It will be noted that total operating revenues have increased 
from $11,921.87 to $13,329.00, and the net operating revenues have 
increased from $4,566.91 to $6,934.83. This increase, however, 
is more apparent than real. From the separate statement of ex- 
penses of several exchanges exhibited in table IV, it appears 
that the 1909 figures are largely estimates and, hence, probably 
an overstatement of the actual amounts i>aid during that year. 

From table IV it appears that the gross income of operation 
at the Lake Mills exchange has increased from $2,025.71 to 
$2,746.87; the gross income of the Sun Prairie exchange from 
$1,592.39 to $2,027.62, and the gross income of the Waterloo 
exchange from $948.81 to $2,172.18. 

With gross income for the plant as a whole of $7,152.12, it 
will be noted that there is at present available for interest and 
depreciation 10.1 per cent upon the cost of reproduction new, of 
$70,610. Likewise it will be noted: that when the value of the 
Lake Mills, Waterloo and Sun Prairie exchanges is increased so 
as to include a proportionate part of the investment in lines con- 
necting the three exchanges, that the amount available for inter- 
est and depreciation, with a gross income of $2,746.87, amounts 
to 9.2 per cent on a cost new of $29,836; the gross income of 
$2,172.18 of the Waterloo exchange amounts to 9.5 per cent of a 
cost new of $22,902 ; and the $2,027.62 gross income of the Sun 
Prairie exchange amounts to 11.4 per cent on a cost new of 
$17,872. 

It has been pointed out in previous decisions of this Commis- 
sion that the amount properly set aside for depreciation, in ad- 
dition to the amounts usually expendeil in repairing and main- 
taining the plant, aggregate in the neighborhood of 10 per cent. 
With a similar allowance in this case, it does not appear that the 
contention of the applicant company, that its revenues are not 
sufficient to meet depreciation and interest, are unfounded. 

In table V the revenues of the company, based upon the in- 
stallation reported on June 30, 1910, are computed under the 
present and proposed rate schedule. It will be noted that the 
expected increase in revenue from all three exchanges will ag- 
gregate $2,692.80. This does not seem to be an unreasonable in- 
crease in company's revenues at the present time. 



Digitized by VjOOQIC 



In re appl. intbrurban tel. co. 



191 






00 



PS H 

O 



0U 



J5 









> 



?5 
d 



> 

cu 



55 
d 



> 
d 



£ 



> 



55 

d 



i §s§$sis= 



» «*-? 












2- 



§ s§ 



2 §S 






i§ 



=is 



ft IaSS 









I sii 



S: 






gffS 



04 lA 



» 






lis 






|8g 



»o.ft 




§isS2S'"^S E 



SJ5: 


ii 


^ 


3 : 




fi : 


Is 


e: 


iu 


^i| 


*H ^ 


W ' 






«» 


M 


2t$ 


g§ 


co^ 


lA 






«» 


«» 



♦-« O '-''S '-" 



c8 



&- OS o3 

Hg h5 ^>: 



o 

OQ 



SS5 

IS 







fi 



Digitized by VjOOQIC 



192 



RAILROAD COMMISSION OP WISCONSIN. 



TABLE II. 

BALANCE SHEET-UTILITY AS A WHOLE. 
Ab of June dO. 





1909 


1910 


A88KT8. 
Property and DlftTlt. 


$108,716 22 

2,500 00 

101 01 


$110,323 10 




2.100 00 


^Umnt matfttji , r . T 


3,763 26 




Total 


$U1.317 23 

$09.800 00 

21.100 0$ 

2.367 0$ 

13.050 17 


1123,536 36 

$60,800 00 
22,200 00 


LlABIUTISS. 

Capital stock 


Bonded d«bt 


Notes and accounts payable 


6,212 12 


Surplus fund ', , 


20,374 24 






Total 


$111,817 n 


$123,586 36 







TABLE IIL 

INCOME ACCOUNT-UTILITY AS A WHOLE-. 

Yfar ending June 90. 





ieo9 


1910 


Total ODoralinir revenues 


$11,921 87 
7.354 96 


$13,329 00 


Total ooeratinff exnenses 


6,304 17 




Net operatlnfp Ftjvenues 


$4.566 01 


$6,034 83 


Non-operatin0 revenues 


11 84 








Gross income of operatlncr 


$4.566 91 
125 00 


$6,946 67 


NoU'KSDeratinff revenues of utility as a whole 


205 45 






Gross Income 


$4,691 91 
1.055 00 


$7,152 12 


Interest on debts 


1,283 S3 






Net income 


$3.636 91 


$5,868 79 







Digitized by VjOOQIC 



In re appl. interurban tel. co. 



193 



TABLE IV. 

EXCHANGE INCOME ACCOUNT, -INCLUDING TOLL SERVICE. 
Year ending June 31). 



Lake Mills Exchange. 



Total operating' revenues. 
Operating expenses : 

Central of&ce 

Wlra plant 

Substation 

Commercial 

General 

Undistributed . . ^ 

Taxes, 



Total (derating expenses. 



Net operating revenues. . 
Non-operating revenues. 

Oioss Income 



SiTN Prairie Exchakge. 



Total operating revenues. 
Operating expenses: 

Central office 

Wire plant 

Substation 

Oommerclal 

General 

Undistributed 

Taxes 



Total operatlnir expenses. 



Net operating revenues. . 
Non-operatlnff revenues. 

Gross Inoome 



Waterloo Exchange. 



Total operating revenues. 
Operating expenses : . 

Central office 

Wire pl*nt 

Substation 

Oommerclal 

General 

Undlstribated 

Taxes 



Total operating expenses . 



Net operating revenues. . 
Non-orer»tins revenues. 

GfMB Inoome 



1909 



14.443 65 

$1.158 00 
125 00 
100 00 

25 00 
700 00 
222 70 

87 24 



K.^17^94 
127025 tT 



I2.U25 71 



$3.977 72 

$1,I»8 00 
75 00 
75 00 
25 00 
700 00 
218 m 
b9 04 



$2,385 33 
11.592 3U 



I1.U2 30 



o.5oc:o 

$1,251 00 
175 00 
lUO 00 

25 00 
700 00 
221 70 

78 99 



$2.551 t39 

$948 81 



1910 



$4,920 29 

$079 28 
398 58 
45 00 



651 34 

7 80 

97 76 



J2^173 76 

$2,746 5ir 
34 



$2,746 87 



$4,135 66 

$1,005 14 

328 99 

46 05 



653 43 

"ii'is 



$2.118 39 



$2,017 27 
10 h5 



$2,027 62 



$4.273 05 

$835 80 

4tJ9 26 

45 00 



iM8 81 



667 48 

84'48" 

g2. 10 2 oT 

; $2.17r03~ 
I 1 15, 

I WaTTlT 



13— R. D. 



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194 



RAILROAD COMMISSION OF WISCONSIN. 



TABLE V. 

PRESENT AND PROPOSED REVENUES OF EXCHANGE SYSTEMS. 
Ingtailation as of June 30, i9tO. 
Revenues under proposed rates computed with 10% per month discount allowed. 



Lake Mills. 



1 party business... 
Extension 

1 party residence. 

2 par^ residence. 
Rural 



Total. 



Sun Pbaibii. 



1 party business... 

1 party residence. 

2 party residence. 
Rural 



Total. 



Waterloo. 



1 party business... 
t party business... 
1 party residence. 
4 party residence. 
Rural 



Total 

Total three ezchances 

Total Increase In revenue. 



No of 
'phones. 



65 

7 
71 
138 



68 

&3 
23 
115 



17 
140 
86 



Revenue- 
present 
rate. 



1075 00 
63 00 

852 00 
1.666 00 

900 00 



•4,596 00 



1870 00 

638 00 

276 00 

1,725 00 



63.507 00 



1780 00 

420 00 

204 00 

1,680 00 

1,280 00 



14.374 00 



$12,417 00 



Revenue- 
proposed 
rate. 



$1.560 00 

63 00 

1.102 80 

1.004 40 

900 00 



$6,710 20 



$1.302 00 

800 40 

317 40 

1,725 00 



$4.324 80 



$1,248 00 

571 80 

285 60 

1.680 00 

1,280 00 



$6,074 80 



$15,109 80 



$2.602 80 



Consideration of the value of the plants of the applicant and 
the revenues and expenses of the respective exchanges, as an- 
alyzed above, points to the conclusion that the appHcant is law- 
fully entitled to the increase in rates for which it has applied, and 
that without such increase it cannot earn a reasonable rate of 
interest and depreciation, both of which are necessary for the 
permanent maintenance of good service. 

It is Therefore Ordered, That the applicant, Interurban 
Telephone Company, be authorized to put into effect the schedule 
of rates applied for herein on Jan. 1, 1911. 



Digitized by VjOOQIC 



BUBNS V, LA CBOSSE GAS & EL. CO. ET AL. 195 



JOHN C. BU!RN8, 

LA GROBSB OA8 AND BLBCTRIC COMPANY, 
LA CROBSB TBLBPHONB COBAPANY. 



Butmitied Oct. SI, 1910, Decided Jan, i, 1911. 



Petition praying that the respondents be ordered to remove their poles 
from an alley in the city of La Crosse so that a spur track may 
he constructed to the warehouse of the petitioner. The railway 
company was in 1884 by ordinance granted the right to con- 
struct an industrial track along said alley and did construct a 
track for about one-half the distance. 

Held: That at the time of the passage of said ordinance railway com- 
panies had a right to construct industrial tracks along the 
streets and alleys of the city without obtaining consent from 
the municipality; that said ordinance was therefore a nullity. 
That the respondents erected their poles in said alley by right 
derived from the state and from the municipality; that they 
can not be compelled to incur the expense of moving the poles 
in order that such spur track may be constructed to petitioner's 
industry. The Jurisdiction of the Commission was not ques- 
tioned. Petition dismissed. 

The petitioner is a dealer in fruits and other merchandise at 
the city of La Crosse, Wis. He alleges that the respondents are 
public utility corporations doling business in said city of La 
Crosse; that he has a wholesale fruit warehouse in block 8 of the 
plat of the city of La Crosse which faces Front street and ex- 
tends back to an alley in said block ; that he made ai>plication to 
the Chicago, Milwaukee & St. Paul Railway Company for an 
extension of its track in the alley in said block so that the same 
woukt accommodate his warehouse and furnish him with ship- 
ping facilities ; that said railway company in the year 1884, by 
ordinance No. 75 of the city of La Crosse, was granted the right 
and privilege of building, maintaining and perpetually operating 
its railway track along the east side of said alley ; that the said 
railway company signified its willingness to construct and extend 
its said track in said alley, provided that the petitioner would fur- 
nish the right of way and pay all damages and expenses of con- 
structing the same ; that when petitioner proceeds to obtain the 
right of way, he found stationed in the place granted by the city 



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196 RAILROAD COMMISSION OP WISCONSIN. 

of La Crosse for the construction of said track one pole belong- 
ing to the said La Crosse Gas & Electric Company, and one pole 
belong'ing to the said I^ Crosse Telephone Company, both of 
which were in the proposed right of way ; that he requested the 
said respondents to remove said poles so as to permit the exten- 
sion of the said track, but that the said respondents refused, 
still refuse, and neglect to comply with said request; that the 
said railway company can not and will not extend its said track 
until said poles are removed so that there will be sufficient clear- 
ance for the safe operation of trains over said- track when ex- 
tended ; th^t it IS impracticable to lay said track in the center of 
said alley. or on the west side thereof, and tliat the said track can 
not be extended unless the respondents remove said poles, and 
that the ordinance granting to the respondents the privilege of 
placing poles in the alleys of the city of La Crosse was passed 
long after the ordinance granting the privilege to the said rail- 
way company to lay its said track on the east side of said alley. 
Wherefore, petitioner prays that the respondents be required to 
remove said poles from the place where they are located, so as to 
enable the extension of said railway track as aforesaid. 

Neither of the respondents filed any answer to the petition. 
The hearing was had on Oct. 31, 1910, at the city of La Crosse. 
Mahoney & Schubert appeared for the petitioner. Woodard & 
Lees appeared for the La Crosse Gas & Electric Company, and 
W, F. Goodrich appeared for the La Crosse Telephone Company. 

The facts are not in controversy. It appears that in 1884 the 
common council of the city of La Crosse passed an ordinaiKe 
granting to the Chicago, Milwaukee & St. Paul Ra*ilway Com- 
pany the right to lay an industrial track southerly along State 
street and through the east side of the alley in block 8. There- 
upon the railway company constructed such track about half 
way through said alley and within a short distance of petitioner's 
warehouse. In 1901 the city of La Crosse granted the La Crosse 
Gas & Electric Company the right to use the streets and alleys 
of said city for the purposes of its distribution system. Pursu- 
ant to said grant, the La Crosse Gas & Electric Company 
erected one of the poles here in question. The other of saiid 
poles was erected by the La Crosse Telephone Company some 
nine years previous hereto. 

It is impossible for the railway company to extend its said 
side track along the east side of Raid alley to the petitioner's 



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BURNS V, LA CROSSE GAS & EL. CO. ET AL. 197 

warehouse without re-locating said poles. The respondents are 
willing that said poles be removed from their present location 
to permit of such extension of said track, but are unwilling to 
make such removal unless the expense thereof is borne by the 
railway company or the petitioner. 

The petition is novel. It seeks to enforce an alleged right 
vested! in the Chicago, Milwaukee & St. Paul Railway Company 
by sec. 1831a, which authorizes the company to construct spur 
tracks to industries, and by an ordinance of the city of La 
Crosse authorizing the construction of such track in the alley 
in question for the purpose of serving petitioner's industry. The 
railway company is not a party to these proceedings and makes 
no claim in the premises. The jurisdiction of the Commission 
to entertain the proceedings does not seem to be questioned, and 
the conclusion we have reached renders a decision of the question 
of jurisdiction unnecessary. 

At the time of the passage of the ordinance of 1884, purporting 
to grant to the railway company the right to construct a spur 
track in said alley, railway companies had the right to construct 
such tracks to industries and to acquire the right of way therefor, 
by condemnation or otherwise, without consulting the wishes of 
the muncipality in respect to the same. No authority from the 
municipality was required to enable the railroad to occupy streets 
and alleys with spur tracks. It was not until ch. 262 of the 
Laws of 1907 was enacted, amending sec. 1831a, that cities were 
granted the power to pass upon the location of such tracks in the 
public thoroughfares. Prior to such amendment cities were in 
the same situation respecting the use of streets by railway 
companies for tracks as are towns and- villages at the present time. 
Farmers' Store Company v. C. St P, M. & 0, R, Co. 3 W. R. 
C. R. 42, 50. The ordinance of. 1884 was therefore a nullity 
when enacted, and no right can be predicated upon it. 

The telephone company obtained its right to occupy the 
streets and alleys of the city direct from the state The gas and 
electric company obtained such right from the municipality. 
Of course, privileges of this character merely confer rights as 
against the public. Abutting property owners must be compen- 
sated for the additional burden upon the fee caused by the loca- 
tion of the telephone and electric poles within streets and alleys. 
In the present case property holders are not complaining, and, 
if they have not been compensated for the location of the poles 



Digitized by VjOOQIC 



198 RAILROAD COMMISSION OF WISCONSIN. 

in question, their rights in the premises have been barred by the 
statute of limitations, sec. 1778/i. 

Obviously, un-der the circumstances, the respondents can not 
be compelled to incur the expense of moving the poles in ques- 
tion to enable the railway company to extend its spur track to 
petitioner's industry. As the respondents are rightfully occupy- 
ing with their poles the space required by the railway company 
for the extension of its spur track along the east side of said 
alley, the cost of moving them must be borne by. the railway 
company or the person to be benefited by the change if the rail- 
way company refuses to bear the burden. 

The respondents have manifested a willingness to accommodate 
the petitioner and the railway company upon being compensated 
for the removal of the poles. If the petitioner requires the ser- 
vice applied for by him to the railway company, it will be nec- 
essary for him to bear the expense involved in clearing the pro- 
posed right of way of the poles in controversy. 

No order will be made herein. 



Digitized by VjOOQIC 



OSHKOSH FUEL CO. V. C. M. & ST. P. B. CO. 199 



OSHKOSH FUBL COMPANT 

vs. 
CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY. 



BeciOed, Jan. 6, 1911, 



Petition alleging exorbitant charges on a shipment of one carload of 
dry fuel wood from Gravel Pit, Wis., to Horicon, Wis., the rate 
being higher than that from Doering, Wis., to Horicon, on 
which line Gravel Pit is an intermediate point; the rate con- 
tended for was later also made efCective between Gravel Pit and 
Horicon. Petition further alleges overcharge on a shipment 
of slabs from Beaver, Wis., to Racine, Wis., and contends that 
the ratjje from Wausaukee, Wis., to Racine, Wis., should have ap- 
plied. 

Held, as to the shipment from Gravel Pit to Horicon: That the rate 
exacted was excessive and refund ordered. 

Held^ as to the shipment from Beaver to Racine: That had the rate con- 
tended for been exacted, the minimum weight upon which the 
charge was based would have been 60,000 lbs. instead of 40,000 
lbs., as applied herein; that in such case the charge would have 
been higher than that exacted. The claim for refund on this 
shipment is therefore denied. 

Petitioner is a corporation engaged in the wholesale wood fuel 
business at Oshkosh, Wis. It alleges that on May 9, 1910, the 
respondent railway company received for transportation one car 
of dry fuel wood at Gravel Pit, Wis., being a point on its line in- 
termediate to Doering, Wis., and charged for transporting to 
Horicon, Wis., a rate of 5 cts. per cwt., which, on the weight of 
said shipment, 49,400 lbs., amounted to $24.70; that the correct 
and just rate for transportation of the above shipment should have 
been 4 cts. per cwt., or $19.76; that Horicon should have been 
included in group 4 in respondent's tariff G. F. D. 5555 — H in- 
stead of being placed in group 2 ; that shipments from Doering 
to Oshkosh, Brandon, Waupun, Berlin, Omro, Winneconne, and 
other points on the respondent's line north of Horicon are all 
placed in group 4 in said tariff G. F. D. 5555 — H; that ship- 
ments to such points would necessarily pass through Horicon; 
that the respondent did, on May 2, 1910, issue supplement No. 4 
to said tariff G. F. D. 5555— H, effective June 16, 1910, placing 
Horicon in group 4. Wherefore, petitioner respectfully prays 



Digitized by VjOOQIC 



200 RAILROAD COMMISSION OF WISCONSIN. 

that respondent be required to make reparation to it in the sum 
of $4.94, the amount of overcharge as aforesaid. 

The petitioner further alleges that on July 22, 1910, the re- 
spondent railway company received for transportation at Beaver, 
Wis., one carload of slabs, for which it charged the petitioner a 
rate of 5 cts. per cwt. for transportation to Racine, Wis.; that 
said shipment should have moved on a rate of 4Mj cts. per cwt., as 
it traveled a distance of less than 200 miles ; that under sec. 2 of 
tariff G. F. D. 5555 — H the rate for a djistance of 180 miles and 
200 miles or less is 4}^ cts. per cwt. ; that the position taken by 
the railway company in claiming, that Beaver, being omitted from 
sec. 1 of said tariff, is not entitled to rates provided in sec. 2 
thereof, is unjust and unreasonable. Wherefore, petitioner prays 
that the respondent be directed to refund to it an overcharge of 
$2 on said shipment. 

No answer has been filed by the respondent .railway com- 
pany. 

The claims were submitted upon the pleadings, papers, docu- 
ments, schedules and vouchers on file. 

The faot that the intermediate point was not protected by the 
through rate was evidently the result of an oversight. There is 
no reason in this case that the rate applicable to the shipment in 
question should be greater than the rate on similar shipments 
from Doering to Oshkosh and other poSnts mentioned in the 
petition. The respondent, upon being informed of the omis- 
sion, rectified the same by publishing an amendment to its tariff, 
placing Horicon withfln group 4 of its tariff G. F. D. 5555 — H. 
(C. P. Tinkham v. C. & N, W. Ry. Co, et al 4 W. R. C. R. 329, 
330.) 

We therefore find and determine that the charge of 5 cts. per 
cwt., exacted of the petitioner for the aforesaid shipment of one 
car of dry fuel wood from Gravel Pit, Wis., to Horicon, Wis., is 
excessive, and do fifKl that ai reasonable charge for such ship- 
ment would have been a rate of 4 cts. per cwt. The amount of 
the excess charge upon such shipment is $4.94, as alleged. 

Respecting the claim for overcharge upon a car of slab wood 
which moved from Beaver, Wis., to Racine, Wis., it appears 
that the charges were assessed on 40,000 lbs. at 5 cts. per cwt., 
amounting to $20. The claim for refund is based on 40,000 lbs. 
at 4j^ cts. per cwt., amounting to $18 and making an excessive 
charge of $2. 



Digitized by VjOOQIC 



OSHKOSH FUEL CO. V, C. M. & ST. P. R. CO. 201 

The rate of 5 cts. per cwt. charged upon the aforesaid ship- 
ment is named in respondent's tariff G. F. D. 5555 — H, which 
took effect Sep. 15, 1909, and is still in force. This rate applies 
from Wausaukee to Racine, and as a maximum rate from inter- 
mediate points to Racine, It is subject to minimum weights as 
follows: Cars 34 feet in length and under, 40,000 lbs.; cars 
under 40 feet in length and over 34 feet, 50,000 lbs. ; cars 40 
feet in length and over, 60,000 lbs. The car in which the ship- 
ment in question moved is No. 203425, and is 40 feet in length, 
according to the official railway equipment register, and there- 
fore shipments in this car, at the 5 ct. rate referred to, are sub- 
ject to a minimum weight of 60,000 lbs., or, in freight charges, 
$30 per car. Beaver is 17 miles south of Wausaukee on the 
direct line from Wausaukee to Racine, and shipments from there 
are entitled to take the Wausaukee rate. 

Respondent's tariff G. F. D. 5555 — H also names distance 
rates, and, provides that these may be used when lower rates 
from and to points named in the tariff are to be made. The 
distance from Wausaukee to Racine is 204 miles, and the dis- 
tance rate for this distance is the same as the specified rate of 
5 cts. per cwt., and subject to the same minimum weights. 
Beaver is not named in this tariff, and therefore the distance 
rates do not apply from there directly, but may be applied on 
the Wausaukee distance, as these rates also apply as maxima 
at intermediate points. 

The distance from Beaver to Racine is 180 miles. The rate 
for this distance is 4% cts., but this rate is also subject to the 
minimum weights quoted above. The car in which the ship- 
ment moved being over 40 feet in length, the minimum would be 
60,000 lbs., making a charge of $27. 

In the absence of a demand by the shipper for a car of par- 
ticular dimensions, the railway company may furnish such car 
as it may have convenient, and the shipper is bound by the min- 
imum loading capacity thereof. 

Wc find no authority in the schedules on file for the rate of 
5 cts. per cwt. exacted of the petitioner on 40,000 lbs., as shown 
by the freight bills. But it is apparent from what has been said 
that the petitioner is not entitled to a refund upon the shipment 
in question. 

Now, Therefore, it is Ordered, That the Chicago, Milwau- 
jcee & St Paul Railway Company be and the same is hereby au- 



Digitized by VjOOQIC 



202 RAILROAD COMMISSION OP WISCONSIN. 

thorized and directed to refund to the Oshkosh Fuel Company, 
the petitioner, the sum of $4.94, being the excess charged for the 
aforesaid shipment of one car of dry fuel wood from Gravel 
Pit, Wis., to Horicon, Wis. 

It is Further Ordered, That the claim for refund upon the 
transportation of one carload of slabs from Beaver, Wis., to 
Racine, Wis., be and the same is hereby dismissed. 



Digitized by VjOOQIC 



CITY OF LAKE GENEVA V, EQUITABLE EL. LT. CO. 203 



CITY OP LAKE GENB3VA 

vs. 
EQUITABLE ELECTRIC LIGHT COMPANY. 



Vecided Jan. 11, 1011. 



Held: That it is a violation of the statute for a public utility to exact 
a greater compensation from persons not owning their meters 
than from persons owning such meters. Respondent is or- 
dered to cease and desist from such practice. 

The parties to this proceeding have submitted the matter in 
controversy upon the following statement of facts : 

The Equitable Electric Light Company is a public service cor- 
poration doing a general lighting and power business in the city 
of Lake Geneva and immediate vicinity. Said company has in 
the past and is now making a charge at its Lake Geneva plant 
of 25 cts. per month against its customers for meter rent, ex- 
cept that no charge for meter rent is made against its customers 
when they own their own meters. 

The practice of the company in exacting a greater compensa- 
tion from persons for seyvice rendered because they do not own 
their own meters, is clearly in violation of the statute. Sec. 
1797m— 90 provides that 

"It shall be unlawful for any public utility to demand, charge, 
collect, or receive from any person, firm or corporation less 
compensation for any service rendered or to be rendered by said 
public utility in consideration of the furnishing by said person, 
firm or corporation of any part of the facilities incident thereto ; 
provided nothing herein shall be construed as prohibiting any 
public utility from renting any facilities incident to the produc- 
tion, transmissk)n, delivery or furnishing of heat, light, water 
or power or the conveyance of telephone messages and paying a 
reasonable rental therefor, or as requiring any public utility to 
furnish any part of such appliances which are situated in and 
upon the premises of any consumer or user, except telephone 
station equipment upon the subscriber's premises, and unless 
otherwise ordered by the Commission meters and appliances for 
measurements of any product or service/' 



Digitized by VjOOQIC 



204 RAILBOAD COMMISSION OF WISCONSIN. 

It is Tiierepore Ordered, That the Equitable Electric Light 
Company cease and desist from exacting -charges of such of its 
customers as own their own meters a less sum for services ren- 
dered because of such ownership of meters than it exacts of its 
customers wdiose meters are furnished and owned by it. 



Digitized by VjOOQIC 



BI.OCK-POtLAK IRON CO. V. C. M. & ST. P. R. CO. 205 



BLOCK-POLLAK IRON COMPANY 

vs. 
CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY. 



Decided Jan, U, 1911. 



Petition alleging overcharges on the shipment of a carload of scrap 
iron from Milwaukee, Wis., to MajTille, Wis., respondent hay* 
ing exacted a rate of 5 cts. per cwt., which rate is the com- 
modity rate on scrap iron between Chicago and Milwaukee, 
Mayrille being an intermediate point. A rate .of 50 cts. per 
gross ton on scrap iron from Milwaukee to MayviUe was made 
effective on respondent's line after the shipment had moved. 

Held: That the rate of 5 cts. per cwt. exacted by respondent was un- 
usual and exorbitant, and that 60 cts. per gross ton would 
have been a reasonable rate. Refund ordered on this basis. 

The petitioner is a corporation engaged in the manufacture of 
iron and steel products, and has its principal place of business 
in Chicago, 111. It alleges that on Aug. 15, 1910, it purchased a 
carload of scrap iron at Milwaukee, Wis.; that said carload was 
delivered at said point to the respondent railway •company, to be 
transported to Mayville, Wis.; that the respondent transported 
said shipment from Milwaukee to Mayville; that said shipment 
weighed 92,100 lbs., for which the respondent collected freight 
charges amounting to $46.05, based on a rate of 5 cts. per cwt. ; 
that at the time said shipment was made; there was no commod- 
ity rate in force applicable to such shipments from Milwaukee to 
Mayville, but that there was a rate of 5 cts. per cwt. on said 
commodity in force from Chicago, 111., to Mayville; that the 5 
cts. per cwt. rate from Chicago to Mayville is carried in respond- 
ent's tariff G. F. D. 7300-B, which carries an intermediate 
clause; that on Aug. 20 respondent issued a supplement to its 
tariff G. F. D. 24r-E, item 650V2, reducing the rate to 50 cts. 
per gross ton; that the distance from Chicago to Milwaukee is 
140 miles, and the distance from Milwaukee to Mayville is 55 
miles; that while the rate of 5 cts. per cu^t. from Chicago to 
Ma)nrille, a distance of 140 miles, may be a reasonable rate, the 
rate of 5 cts. per cwt. from Milwaukee to Mayville, a distance 
of 55 miles, appears to be unreasonable, and that the petitioner 
has been siibjected to the payment of the rate of transporation 



Digitized by VjOOQIC 



206 BAILBOAD COMMISSION OF WISCONSIN. 

as aforesaid, which, when exacted, was unjust, unreasonable and 
excessive. Wherefore, petitioner prays that the respondent be 
required to refund to it the sum of $25.49, the difference between 
the rate of 5 cts. per cwt., collected on said shipment, and the 
rate of 50 cts. per gross ton^ as established by said tariflF 24-E, 
as amended. 

The respondent, answering the petition, admits all the formal 
allegations thereof, and avers that if said shipment moved as al- 
leged in the petition, the lawful rate in force and effect at the 
time, of 5 cts. per cwt., was charged upon such shipment, and de- 
nies that the petitioner has been overcharged in the sum of $25.49, 
or any amount on said shipment, if it moved as in said petition 
alleged. 

The claim was submitted upon the pleadings, vouchers, sched- 
ules and papers on file. 

While the voluntary reduction of a rate by a railway company 
is not a xxmfession that such rate was exorbitant, yet in the in- 
stant case it is apparent that the rate exacted of the petitioner 
was unusual. The rate of 50 cts. per gross ton is less than one- 
half of the rate in effect at the time the shipment in question 
moved. Considering the cost of transportation, and all other 
factors entering into the question of the reasonableness of a rate, 
it appears that 50 cts. per gross ton is adequate compensation for 
the transportation services rendered in hauling scrap iron from 
Milwaukee to Mayville. More than double such charge is, and 
was at the time the shipment moved, an exorbitant charge. Un- 
der the circumstances, the respondent should make reparation to 
the petitioner upon the basis of the tariff now in effect. Steven 
& Jarzis Lumber Co, v, C. St. P. M, & O, Ry. Co, 2 W. R. C. 
R. 131 ; //. W. Wright Lumber Co. v. C. Mk & St, P. Ry, Co, 4 
W. R. C. R. 770; Kenfield & Lcmoreaux v. C. St, P, M, & O. 
Ry. Co. 4 W. R. C. R. 465. 

For the reasons stated, we find and determine that the rate 
of 5 cts. per cwt., exacted of the petitioner for the aforesaid 
shipment of scrap iron from Milwaukee to Mayville, is unusual 
and exorbitant, and that the reasonable rate to have exacted for 
such shipment would have been the rate of 50 cts. per gross ton. 

Based upon the latter rate, the amount of the award is $25.49. 

Now, Therefore, ifp is Ordered, That the Chicago, Milwau- 
kee & St. Paul Railway Company be and the same is hereby 
authorized and directed to refund to the petitioner, the Block- 
PoUak Iron Company, the sum of $25.49. 



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LISTMAN MILL CO. V. C. & N. W. R. CO. 207 



LISTMAN MILL COMPANY 

vs. 
CHICAGO AND NORTH WESTERN RAILWAY COMPANY. 



Beaded Jan. 14, 1911. 



Petition alleging overcharges on shipment of five carloads of flour from 
La Crosse, Wis., to Galesvllle, Wis., respondent having charged 
a rate of 8 cts. per cwt., whereas there is in effect a rate of 
6 cts. per cwt. from Galesville to La Crosse. 

Held: That the rate exacted was unusual and exorbitant, and refund is 
ordered on the basis of a rate of 6 cts. per cwt. 

The petitioner is a corporation engaged in the milling business 
at La Crosse, Wis. It alleges that on and between Aug. 5 and 
Sep. 14, 1910, it shipped five carloads of flour and other mill 
products from La Crosse to Galesville, Wis., for which it was 
charged the rate of 8 cts. per cwt.; that the rate on the same 
commodities from Galesville to L» Crosse is 6 cts. per cwt. ; that 
if it had been charged at the rate of 6 cts. per cwt., the amount 
it would have been obliged- to pay would have been $32.07 less 
than it was actually obliged to pay for such transportation serv- 
ice; that the rate exacted of the petitioner was exorbitant and 
unreasonable. Wherefore, petitioner prays that the respondent 
railway company be authorized and directed to refund to it the 
said sum of $32.07. 

The answer of the respondent railway company admits all the 
allegations of the complaint, and alleges that, effective Nov. 15, 
1910, a rate of 6 cts. i>er cwt. upon the commodities mentioned 
was put in effect from La Crosse to Galesville, and therefore it 
joins in the prayer of the petition. 

The claim was submitted upon the pleadings, vouchers, sched- 
ules and documents on file. 

It is conceded that there is nothing in the situation warrant- 
ing a higher rate on the commodities mentioned when trans- 
ported from La Crosse to Galesville than the rate applying to the 
same commodities when moving in the opposite direction. 

We therefore find and determine that the rate of 8 cts. per 



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208 RAILROAD COMMISSION OP WISCONSIN. 

cwt., exacted of the petitioner for the aforesaid shipments of 
flour and other mill products from La Crosse to Galesville, is 
unusual and exorbitant, and that the reasonable rate to have ex- 
acted for such shipments would have been 6 cts. per cwt. 

Now, Therefore, it is Ordered, That the Chicago & North 
Western Railway Company be and the same is hereby authorized 
and directed to refund to the petitioner, the Listman Mill Com- 
pany, the sum of $32.07, being the excess charge exacted upon 
the aforesaid shipments. 



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YAWKBY-BISSEL lumber CO. t'. C. & N. \V. R. CO. 209 



YAWKBY-BISSEXLL LUMBER COMPANY 

VB. 

CHICAGO AND NORTH WESTERN RAILWAY COMPANY. 



Decided Jan. 16, 19X1. 



Petition alleging overcharges on carload shipments of lumber from 
Arbor Vitae and Hazelhurst tq Appleton and Kaukauna; the 
rate contended for had been eftectlve before the shipments 
moved and was later again made effective. 

Hetd: That the rate exacted was unusual and exorbitant; refund or- 
dered. 

Petitioner is a corporation engaged in the lumber business at 
Af4x>r Vitae and Hazelhurst, Wis. It alleges that for a number 
of years prior to and including March 27, 1910, the respondent 
had in effect its tariff No. 5600-A, which named a rate of 9 cts. 
per 100 lbs. on lumber in carload lots shipped from Arbor Vitae 
mills, or Hazelhurst mills, to Appleton and Kaukauna; that com- 
metKing March 28, 1910 and up to and including May 21, 1910, 
the respondent raised the above mentioned rate one cent per 100 
lbs. 1^ virtue of its tariff No. 5600-B, making the rate on lumber 
in carload k>ts during such period 10 cts. per 100 lbs. between 
the above named points, and collected of the respondent freight 
charges on various shipments made between said points on the 
basis of 10 cts. per 100 lbs. ; Ihat commencing June 1, 1910, the 
respondent reduced the above rate from 10 cts. to 9 cts., by virtue 
of amendment No. 4 to its tariff No. 5600-B, thus restoring the 
former rate which had been in effect prior to March 28, 1910, 
and which is the rate now in effect ; that the said increased rate 
during the period from March 28, 1910, to May 31, 1910, both 
inclusive, was imreasonable and unwarranted; that the cost to 
said respondent for the servkre performed was no more during 
the period of such advanced rate than prior thereto or since the 
reduction of the same; that, on account of the increase in rate 
above mentioned, the petitioner suffered an injustice, in that it 
was obliged to pay an increase of one cent per 100 lbs. to the 
respondent; that the respondent exacted of it for shipments on 
and between April 25, 1910, and June 24, 1910, the sum of 
$121.10 as follows: 
14— R. D. 



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210 EAILEOAD COMMISSION OF WISCONSIN. 

April 25, 1910, one car shipped from Hazelhurst mills to Ap- 
pleton, weight 25,600 lbs., charges $25.60; 

May 17, 1910, one carload of lumber shipped from Arbor 
Vitae mills to Appleton, weight 31,100 lbs., charges $31.10; 

June 8, 1910, one carload of lumber shipped from Arbor Vitae 
mills to Appleton, weight 30,000 lbs., charges $30.00; 

June 24, 1910, one carload lumber shipped from Hazelhurst 
mills to Kaukauna, weight 34,400 lbs., charges $34.40; 

That as against the four freight charges above mentioned, 
amounting to $121.10, a reasonable charge would have been 
$108.99, based on the old rate of 9 cts. per 100 lbs. ; that as a 
result the petitioner is entitled to reimbursement from said rail- 
v/ay company in the sum of $12.11. Wherefore, petitioner 
prays that the respondent be required and authorized to refund 
to it the said sum of $12.11. 

The respondent railway company, answering the petition 
herein, admits all the facts therein alleged and submits the matter 
to the Commision for determination upon such facts. 

On Sep. 29, 1910, the petitioner made claim to the Commission 
against the respondent for the aforesaid shipments of lumber. 
At the suggestion of the Commission the claim was formally pre- 
sented in the petition filed herein on Dec. 2, 1910. It thus ap- 
pears that the claim was made on all the shipments mentioned 
within the time limited by the statute. It is conceded that there 
is nothing in the situation that warranted the respondent in in- 
creasing its rate on lumber from 9 to 10 cts. per 100 lbs., moving 
between the points mentioned. A rate of 9 cts. per 100 lbs. is 
fairly compensatory for the transportation services required in 
transporting lumber from Arbor Vitae or Hazelhurst to Apple- 
ton or Kaukauna. 

We therefore find and determine that the rate of 10 cts. per 
100 lbs., exacted of the petitioner by the respondent upon the 
aforesaid shipments of lumber, was unusual and exorbitant, and 
that the reasonable rate to have charged- for such services was 9 
cts. per 100 lbs. The amount of the award is, as claimed by the 
petitioner, $12.11. 

Now, Therefore, it is Ordered, That the Chicago & North 
Western Railway Company be and the same is hereby authorized 
and directed to refund to the Yawkey-Bissell Lumber Company, 
the petitioner, the sum of $12.11 on account of the aforesaid ship- 
ments of lumber. 



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In re appl. eleva farmers' tbl. co. 211 



IN RE APPLICATION OP THE ELEVA FARMERS' TELEPHONE 
COMPANY FOR AUTHORITY TO INCREASE RATES. 



Decided Jan. 16, 1911. 

I 

Application for authority to increase its rates to $11 ,per year for 
party lines, and $14 per year for business and ojie-party tele- 
phones. An analysis of the revemues and expenses of the 
applicant company showed that it had been working with a 
deficit, had paid no dividends, and had reserved no deprecia- 
tion fund. It showed further that the revenues which would 
be derived from the present installation under the proposed 
rates would be higher than necessary to cover all^ expenses. 

Applicant was authorized to establish a rate of $10 per year for rural 
and two-party residence -phones, and $13 per year for business 
and single party residence 'phones, with a discount of 26 ctff. 
per quarter if payments are made in advance. 

The Eleva Farmers' Telephone Company, a corporation organ- 
ized under the laws of Wisconsin, on March 4, 1910, filed with 
the Commission an application for authority to increase its. rates. 
The application shows that the existing rates, which were the 
legal rates in effect April 1, 1907, are as follows : 

"All stockholders, 20 cts. per month ; 

"Parties not stockholders, on party lines, that furnish their own 
telephone and keep same in repair, 40 cts. per month ; 

"Parties not stockholders, with business telephone, or on priv- 
ate drop, furnishing their own telephone and keeping same in re- 
pair, 75 cts. per month ; 

"Parties not stockholders, on party lines, when the company 
furnishes telephone, 90 cts. per month ; 

"Parties not stockholders, with business telephone or on priv- 
ate drop, when the company furnishes telephone, $1.50 per 
month." 

The rates which the company desires to substitute for the above 
are: 

"Party lines, $11.00 per year; 

"Business and one-party telephones, $14.00 per year. 

"Bills to be payable quarterly, on Jan 1, April 1, July 1 and 
Oct. 1, with a discount of 25 cts. per quarter if paid for each 
quarter on or before the date specified." 



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212 RAILROAD COMMISSION OF WISCONSIN. 

Hearing in this matter was set for March 18, 1910, but no ap- 
pearances were made. Another hearing was set for June 23, 
1910, but no appearances were made at this hearing. 

The Eleva Farmers' Telephone Company was formed about 
1906 by association of the farmers and business men of Eleva. 
No financial or operating data of the company are available for 
the first few years of operation, but on April 7, 1909, the share- 
holders incorporated under the name of the Eleva Farmers' 
Telephone Company, and the company has been able to furnish 
the Commision with reports since that date. 

A statement of receipts and disbursements of the company 
during the first year after incorporation, up to April 7, 1910, is 
given in table I. 

TABLE I. 
Rboeipts. 

Income from shareholders $324 00 

Income from rented telephones 26 75 

Sale of batteries, etc 36 35 

Sale of shares 67 60 

Loan 40 00 

Total receipts $494 60 

DiBBUBeSHSNTB. 

Pay of operator and rent of room $318 (M> 

Switchboard repairs and labor repairing 50 53 

Purchases of batteries, etc 77 58 

Payments of loan 41 85 

Total disbursements $488 56 

This statement, as presented, shows a balance on hand- of 
$6.04, but the statement is misleading with regard to the actual 
status for the year, because of tlie inclusion of loans and sales 
of shares, which have nothing to do with the operating condition 
of the company. With these items eliminated, the revenues for 
the year ending April 7, 1910, amount to $387.10, and the ex- 
penses to $446.71, leaving a deficit of $59.61. Neither are tlicse 
figures a correct indication of operating conditions, because of 
the inclusion of non-operating revenues from sale of batteries, 
and of cost of batteries in the expense column. Part of this 
item of expense is undoubtedly represeirted by stock on hand 
at the end of the year, which the company has reported at about 
$14. The only revenue which should be stated as coming from 



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In re appl. bleva farmers' tel. co. 218 

this source is tlie profits on sales of batteries and other supplies, 
but in this report the items are not stated as being entirely made 
up of disbursements and receipts made or received on account 
of supplies. 

If these items, which are clearly non-operating rev(enues and 
expenses, are excluded entirely from the above statement, re- 
ceipts amount to $350.75, and expenses to $369.13, leaving a 
deficit of $18.38. 

From the manner in which these items are rei)orted, it is not 
possible to determine just what the exact loss from operation 
amounts to. In all probability, however, the actual loss is not 
far from $50. 

The report of the company for the year ending June 30, 1910, 
shows the following condition of operation : 

TABLE II. 

Total earnings from operation $490 00 

Total operating expenses ." 569" 00 

Operating deficit $79 00 

The details of revenues and expenses which go to make up 
the totals given in table II are not reported by the company, but 
as only operating revenues and expenses are reported, it seems 
that $79 is the correct figure. 

The company has made no allowance for depreciation, and has 
never paid dividends. Instead of paying dividends, the company 
has attempted to furnish the stockholders with returns in the 
form of lower rates, as evidenced by the schedule at present in 
force, which rates are the same as those in effect April 1, 1907. 

In a communication filed with the Commission, dated June 6, 
1910, the company states that a reorganization has been effected, 
by the terms of which the company is to take charge of all the 
telephones and keep them in repair, and to provide for a depre- 
ciation fund. Whether all subscribers are to become sharehold- 
ers, or whether shareholders and non-shareholders are to be 
served as at present, is not stated ; but in any case the company 
is entitled to earnings sufficient to cover depreciation and interest 
in addition to operating expenses. 

It is not known, however, whether the proposed rates are in- 
tended toprovide for dividends, or whether, under the reorgani- 
zation, all subscribers are shareholders, and the dividends are in- 
tended to be provided in the form of lower rates. 



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214 



RAILROAD COMMISSION OF WISCONSIN. 



The valuation reported by the company is for the year end- 
ing June 30, 1910: 

TABLE III. 

Cost of plant, end of year |5»280 09 

Materials and supplies, end of year 20 00 

Total value, end of year |5,300 00 

Comparison of investment per subscriber with companies 
operating under similar conditions, for which vahiations have 
been made by the Commission, is made in table IV. In this 
table the value of plant per 'phone is the cost of reproduction 
new, except in the case of the Eleva Farmers Telephone Com- 
pany, whose Value is that claimed by the company and checked 
by our engineers. 

TABLE IV. 



Company. 


Number of 
subscribers. 


Plant value 
per subseriber. 


A 


825 

m 

119 
146 
264 

1&8 


943.80 


b! :....:.::..:::.:.:::;:::;:::::::::::::::::::::: 


51 50 


c 


52.20 


d:: ;...;;:;::..::;::;;;:;:;;;::;::;:;;::::::;:::::: 


31.10 


E 


84.70 


Eleva Farmers* Telephone Company 


33 54 







From this it appears that the valuation claimed by the Eleva 
Farmers' Telephone Company is reasonable, by comparison with 
representative companies whose value is actually known, as the 
result of the Commission's investigation. 

Accepting $5,300 as a reasonable valuation of the property in- 
volved in this case, we can determine what the cost of furnishing 
service will be. 

Based on the report for the year ending June 30, 1910, the ex- 
penses of carrying on the business would be about as follows : 

TABLE V. 

Operating expenses $569 00 

Depreciation at 8 per cent 424 00 

Interest and taxes at 8 per cent 424 00 

Total 11,417 00 

In addition to the expenses enumerated above, the letter of 
the company, dated March 28, 1910, states that "the officers of 

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In re appl. eleva farmers' TEt. co. 215 

the company have been working without a salary, and all other 
expenses have been kept down lower than we think they can be 
in the future." 

Just how much this added expense should be, cannot be stated 
exactly, but in addition to the item of salaries the expense of 
repairing 'phones must be considered. Under the reorganization 
which has been effected the company is to take charge of all tele- 
phones and lines, some of which were formerly kept in repair by 
the persons receiving service. 

Allowing 12 per cent on the basis of direct expenses for sala- 
ries, we get a revised table of probable operating expenses : 

TABLE VI. 

Salaries, 12 per cent of |569 $68 28 

Direct expenses of operation 669 00 

Depreciation, at 8 per cent 424 00 

Interest and taxes, at 8 per cent 424 00 

Total $1,485 28 

The added expense of keeping in repair such telephones as are 
now maintained by parties receiving servi-oe will undoubtedly 
bring thfs total up to $1,500. 

The letter of the company, dated Nov. 27, 1910, shows that 
there are at present 168 telephones installed, classified as follows : 

147 telephones on rural lines ; 

2 residence telephones on one line in the village ; 

3 lines with one business and one resiidence phone on each ; 
8 single party business telephones ; 

5 single party residence telephones. 

Under the proposed schedule of rates the revenues would be 
as follows: 

147 rural 'phones at $10 net $1,470 00 

5 residence 'phones on two-party line at |10 net. ,,,\ 50 00 

5 residence 'phones on single party line at $13 net 66 00 

3 buffiness 'phones on two-party lines at $13 net 39 00 

8 single-party business 'phones at $13 net 104 00 

Ttotal $1,728 00 

The revenues which will be derived from the present installa- 
tion, if the proposed rates are allowed, will amount to $1,728 
annually, but the expenses, even with allowances made for ex- 
penses which the company has not had up to the present time, 
amount to only about $1,500. From these facts it appears that, 
although the revenue derived from the existing rate schedule is 



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216 RAILROAD OOMMISSION OF WISCONSIN. 

not sufficient to meet the necessary expenses of operation, in- 
cluding interest and depreciation, the revenues which would re- 
sult from the proposed schedule are higher than necessary. 

If the annual receipts per 'phone under the proposed sched- 
ule are reduced by $1, this will cut $168 from the revenues pro- 
duced by the proposed schedule, thus bringing the annual reven- 
ues down to $1,560, which is so close to the estimated operating 
expenses as to appear a reasonable return. That is, the sched- 
ule would be : 

$10 per year for rural and two-party residence 'phones ; 

$13 per year for business and single-party residence 'phones ; 

A discount of 25 cts. per quarter if payment is made in ad- 
vance. 

This would result, of course, in a net rate of $9 per year for 
rural and two-party residence phones, and $12 for business and 
single party residence phones. 

This schedule does not provide for a different rate for different 
classes of business service, but, owing to the relatively small 
number of patrons affected and the fact that the difference in 
rate is small, it does not appear necessary to make such a distinc- 
tion. 

The Applicant, the Eleva Farmers' Telephone Company, 
Is Therefore Authorized to discontinue its present rates and 
to substitute the following : 

$10 per year for rural and two-party residence telephones ; 

$13 per year for business and single-party residence telephones. 

Bills shall be rendered quarterly, on January 1, April 1, July 
1 and Oc^tober 1, with a discount of 25 cts. per quarter if paid 
for each quarter on or before the date specified. 



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BUSWULL LUMBER & MPG. CO. V, C. M. & ST. P. R. CO. 217 



BU8WBLL LUMBER ft MANUFACTURING COMPANY 
CHICAGO, MILWAUKIS? AND ST. PAUL RAILWAY COMPANY. 



Decided Jan. 17, 1911. 



Petition alleging erroneous, illegal, unusual and exorbitant rates on 
Bhipments of fifty-six carloads of logs from Buswell to Wau- 
sail. 

Meld: That the charge exacted was unusual and exorbitant and refund 
ordered. 

The petitioner is a corporation engaged in the manufacture of 
lumber, with its principal office at Wausau, Wis. It alleges that 
it caused to be shipped fifty-six carloads of logs over the re- 
spondent's line from Buswell to Wausau, and that the respond- 
ent exacted charges to the amount of $771.74, or 2.6 cts. per 
cwt., for the said shipment, which is erroneous, illegal, unusual 
and exorbitant, and that a reasonable rate would have been $1.75 
per 1000 feet, or a total charge of $428.05. 

The respondent, the Chicago, Milwaukee & St. Paul Railway 
Company, answering the petition, states that while it had not 
been able at the time such answer was made to verify the 
movements of the various shipments set forth in said petition, 
upon presentation of proof by the petitioners that the shipments 
movied as herein shown and that the charges were as herein rep- 
resented, it prays that an order be made giving the respondent 
the authority to refund the amounts charged and collected over 
and above the rate of $1.75 per 1000 feet, which rate was sub- 
sequently made effective and which it was intended to have in 
effect at the time of the transportation of the shipments which 
have been made by the petitioner since Oct. 29, 1910. 

The claim was submitted upon the pleadings, vouchers and 
documents on file. 

The facts here presented are similar to those considered in the 
case of Merrill JVoodenware Co, v, C. M*. & St. P. R. Co. 
3 W. R. C. R. 54, and the ruling in that case controls the instant 
case. 



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218 RAILROAD COMMISSION OF WISCONSIN. 

We therefore find and determine that the charge of 2.6 cts. 
per cwt., exacted of the petitioner, is unusual and exorbitant, and 
that the reasonable rate to have charged for such shipments 
would have been $1.75 per thousand feet. 

It is Therefore Ordered, That the Chicago, Milwaukee & 
St. Paul Railway Company be and the same is hereby authorized 
and directed to refund to the Buswell Lumber & Manufacturing 
^ Company the sum of $343.69, being the difference between the 
charge actually paid by the petitioners upon said shipments and 
the charge based upon a rate of $1.75 per 1000 feet. 



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SUPEBIOB CRUSHED BOCK CO. V, O. ST. P. M. & O. B. CO. 219 



SUPERIOR CRUSHED ROCK COMPANY 

VB. 

CHICAGO, ST. PAUL, MINNBAPOUS AND OBCAHA RAILWAY 
COllPANY. 



Decided Jan, It, 1911. 



Petition alleging overcharges for switching nine carloads of crashed 
stone from East End station in the city of Superior to Itasca 
station, respondent exacting a charge of 1^ cts. per cwt; in 
a case between the same parties, treating a similar claim as 
to the same switching charges (filed July 14, 1910) » the Com- 
mission held that a charge of |& per car was a reasonable 
charge. 

Held: That the rate exacted of the petitioner was unusual and exorbi- 
tant, and refund ordered. 

The petitioner is a corporation with its -principal place of busi- 
ness in the city of Superior, Wis. It owns and operates a rock- 
crushing plant at Rockcrusher Siding on the Duluth, South Shore 
& Atlantic Railway, about fifteen miles from the city of Superior. 
It alleges that in the month of July, 1909, one E. Hawarden ob- 
tained a contract from the city of Superior for the paving of 
East Second street in said city with plain macadam, and that in 
said month petitioner contracted and agreed with the said Hawar- 
den to furnish him all crushed rock and stone necessary for 
said work at an agreed price per cubic yard, delivered f. o. b. 
cars in carload lots on the works at Itasca station on the line of 
the respondent railway company in the city of Superior, the 
petitioner prepaying all freight and switching charges; that in 
delivering the said crushed rock the petitioner obtained gondola 
cars from the Duluth, South Shore & Atlantic Railway Com- 
pany, which company operates a railroad on which petitioner's 
plant is located, loaded them with stone at said point, and shipped 
them aver the Duluth, South Shore & Atlantic Railway to its 
East End station in the city of Superior, which was the nearest 
point that the cars could be shipped to the place where the said 
Hawarden required them to be spotted on the track of the Du- 
luth, South Shore & Atlantic Railway Company ; that from this 



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220 BAILBOAD 0OMMI8SI0N OF WISCONSIN. 

point it was necessary to have the cars switched over the tracks 
of the respondent to Itasca station, because the respondent is 
the only railway company having a track near the works from 
which said stone could be unloaded ; that in the switching of said 
cars of crushed stone the Duluth, South Shore & Atlantic Rail- 
way Company, on receipt of the said cars at its East End station 
in the city of Superior, caused them to be weighed, and delivered 
them on the side track of the respondent company at its East 
End station in the city of Superior, and the respondent company 
took the said cars by its regular transfer switch engine and 
switched same to the respondent company's Itasca station, a dis- 
tance of not exceeding three miles; that no special switch was 
necessary in handling the said cars by the defendant company, 
but the same were handled together with numerous other cars, 
being transferred or switched from the west end of the city of 
Superior through respondent's company's East Elnd station to re- 
spondent company's said Itasca station; that said switching haul 
is a level haul practically without grade ; that respondent's regu- 
lar tariff or switching arbitrary for the said service of switching 
said cars from its East End station to its Itasca station is 1% 
cts. per cwt., which tariff or switching arbitrary is unusual, ex- 
cessive and exorbitant; that such switching arbitrary is unusual, 
in that it is four times as large as the switching charge or arbitrary 
for the same distance exacted by the Northern Pacific Railway 
Company, the Great Northern Railway Company, the Duluth, 
South Shore & Atlantic Railway Company, and the Lake Super- 
ior Terminal and Transfer Railway Company for the same serv^ 
ice in the city of Superior ; that it is excessive and exorbitant, in 
that it exceeds by between 600 and 700 per cent the actual cost 
of performing said service and doing said work, and thart: a fair 
charge for such switching service would not exceed a flat rate 
or arbitrary of $5 per car. 

Petitioner further alleges that on and between June 15 and 22, 
1910, in pursuance of its said contract with the said Hawarden, 
it caused to be switched over the tracks of respondent railway 
company nine cars, for which the respondent company exacted 
of the petitioner the sum of 1^ cts. per cwt., or a total charge 
of $107.57 on the said nine cars ; that on July 14, 1910, a similar 
claim as to the same switching charges, on the same kind of 
material, under the same conditions, for the same distance, be- 
tween the same parties, was filed with the Commission, which 



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SUPERIOR CRUSHED ROOK CO. V. C. ST. P. M. & O. R. CO. 221 

thereupon rendered and entered a decision wherein and whereby 
it was held that an arbitrary of $5 per car was a reasonable 
charge for the said service, and that under the said ruling a total 
of $45 would be a reasonable compensation for the said service, 
and that the difference between said sum and the amount charged, 
to wit, the sum of $62.57, should be refunded to the petitioner. 
Wherefore, petitioner prays that the Chicago, St. Paul, Minne- 
apolis & Omaha Railway Company be authorized and directed to 
refund to it the said sum of $62.57. 

The respondent railway Krompany, answering the petition 
herein, alleges that the same is similar to the petition of the pe- 
titioner dated Aug. 28, 1909, and served on the respondent on 
Sep. 3, 1909, covering movement of shipments of the same na- 
ture, and alleges that the decision of the Commission in said 
former suit authorized a reduction of charges to the basis of 
$5 per car ; that said charge is now carried in supplement No. 19 
of respondent's tariff G. F. D. 1745-C, issued under special order 
of the Connmission dated July 14, 1910, and that the respondent 
is agreeable to reducing its charge upon the cars enumerated in 
this complaint to the basis of $5 per car, if authorized by the 
Commission so to do. 

The claim was submitted- upon the pleadings, papers, vouchers 
•and documents on file. 

This claim is identical with the one referred to and considered 
in a former case, and for the reasons there assigned reparation 
will be awarded in the instant case. 

We therefore find and determine that the charge of 1% cts. 
per cwt, exacted of the petitioner by the respondent for the 
aforesaid shipments of crushed stone, as unusual and exorbitant, 
and that a reasonable charge for the transportation services ren- 
dered in transporting said carloads of crushed stone as aforesaid 
would have been at the rate of $5 per car. 

Now, Thbrbporb, it is Ordered, That the Chicago, St. Paul, 
Minneapolis & Omaha Railway Company be and the same is 
hcrd>y authorized and directed to refund to the petitioner, the 
Superior Crushed Rock Company, the sum of $62.57, being the 
excess chaise exacted of the petitioner for the aforesaid ship- 
ments of crushed stone. 



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222 RAILROAD COMMISSION OP WISCONSIN. 



OSHKOSH FUESL COMPANY 

vs. 
CHICAGO AND NORTH WESTERN RAILWAY COMPANY. 



Decided Jan, 18, 1911. 



Petition alleging overcharges on various carload shipments of slabs 
from Heincfmann's Mill, a point four miles from Antlgo, 
to South Milwaukee and Port Washington; petitioner con- 
tends that the Antigo rates should have been applied, which 
rates were made effective for Helnemann's Mill after the ship- 
ments had moved. The above claims were informally filed 
with the Commission within a period of six months after each 
shipment had reached its destination, and formal petition was 
not filed until after six months had elapsed. 

Held: That the informal filing of the complaint stopped the running 
of the statute of limitations; that the charges exacted were 
unreasonable and exorbitant, and refund ordered. 

The petition of the above named petitioner shows in substance : 

1. That it is a corporation engaged in the fuel business in the 
city of Qshkosh, Wis. 

2. That the respondent is a common carrier, engaged in the 
transportation of persons and property by the railroad between 
points in the state of Wisconsin, and is subject to the Railroad 
Commission Act. 

3. That in May, 1910, the petitioner shipped two cars of slab 
wood, Nos. 58888 and 94830, respectively, from Heinemann's 
Mill, a point four miles west of Antigo, Wis., to South Milwau- 
kee, Wis., over respondent's line, on each of which cars there 
was charged by the respondent a rate of 4^/^ cts. per cwt., on a 
minimum weight of 50,000 lbs., amounting to $22.50 for each car. 

4. That each of the aforesaid cars was under 34 feet in length 
and therefore subject to a minimum of 40,000 lbs. ; that a rate of 
4 cts. per cwt. should have been applied upon said shipments, for 
the reason that all other forest products out of Heinemann's Mill 
have always moved upon the basis of the Antigo rate and slab 
wood has, up to the spring of 1910, also always moved upon the 
Antigo rate; that on July 23, 1910, the respondent issued its 
supplement 4 to its tariflf G. F. D. 5950 — ^B, which included Hci- 



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OSHKOSH PUEI, CO. 7f, G. & N. W. R. CO. 223 

nemann's Mill in the Antigo group, and that in consequence the 
charge exacted of the petitioner for the aforesaid shipments was 
$13 in excess of what the same should have b^en. 

5. That in June, 1910, the petitioner shipped from the said 
Heinemann's Mill one car of slabs, No. 35281, to South Milwau- 
kee, Wis., over respondent's line, on which the respondent ex- 
acted a rate of 4Vi> cts. per cwt. 

6. That a rate of 4 cts. per cwt. should have been exacted on 
the shipment made in said car 35281, for the reasons mentioned 
in paragraph 4, and that in consequence the petitioner is en- 
titled to a refund of $2.70 upon such shipment. 

7. That in April, 1910, the petitioner shipped two cars of 
slab wood, Nos. 67722 and 11522, respectively, from fleinemann's 
Mill to Port Washington, Wis., over respondent's line, on which 
the respondent collected a charge at the rate of 4^/4 cts. per cwt., 
and is now endeavoring to collect a further charge of Vi cts. per 
cwt. on such shipments. 

8. That for the reasons stated in paragraph 4 the respondent 
is entitled to a refund of $2.24 upon the said freight shipped 
in cars 67722 and 11522. 

9. That in May, 1910, the petitioner shipped one car of slab 
wood. No. 37476, from said Heinemann's Mill to Port Washing- 
ton, Wis., over respondent's line, on which petitioner was obliged 
to pay a rate of 4% cts. per cwt. upon a minimum of 50,000 lbs. ; 
that said car No. 37476 is less than 34 feet in length and there- 
fore is subject to a minimum of but 40,000 lbs. ; that for the rea- 
sons mentioned in paragraph 4 the rate should have been 4 cts. 
per cwt., applying from group G to group 2 (note B, G, F. D. 
5950-B). 

10. That in May, 1910, the petitioner shipped one carload of 
cordwood, No. 7768, from Hatley, Wis., to South Milwaukee, 
Wis., over respondent's line, on which respondent exacted a 
rate of 4^^ cts. per cwt. upon a minimum weight of 50,000 lbs. ; 
that said car No. 7768 was 34 feet and 1 inch in length, and 
under the construction of tariff G. F. D. 5950 a 50,000 lb. mini- 
mum IS correct, but the petitioner believes itself entitled to the 
protection of the actual weight of 45,400 lbs., because of the 
impossibility of loading more cordwood into the extra one inch, 
and because if the car had been 34 feet in length, the actual 
weight would have been charged for such shipment, as Hatley 
is in group G and South Milwaukee is in group 2. Wherefore, 



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224 RAILROAD COMMISSION OF WIS00N8UY. 

the petitioner asks for the protection of a 4 ct rate on the basis 
of the actual weight, and a return of the excess charge amount- 
ing to $3.09. 

The respondent railway company, answering the petition herein, 
admits the allegations of paragraphs 1 and 2 thereof, and alleges 
that its records do not show a shipment of car 58888, as indicated 
in paragraph 3 of said petition, but that car 58882 was shipped, 
and that the records show that this car was taken into account 
at a minimum weight of 40,000 lbs. and at a rate of 4 cts* per 
cwt., making the total charge exacted $16; that the weight of car 
94830, indicated in paragraph 3 of said petition, was subject to 
a minimum loading weight of 40,000 lbs. instead of 50,000 lbs., 
as alleged. 

The respondent further admits that the shipments set forth in 
paragraphs 5, 7, 8 and 10 of said petition were made as allied ; 
and that the rate of 4 cts. per cwt. was made applicable to Heine- 
rnann^ Mill Aug. 25, 1910, as per supplement 4 to G. F. D. 
5950 — B. The respondent submits the claim here presented upon 
the records on file and suggests that the petitioner be required 
to furnish its expense bills, so that the same may be properly 
checked. 

All of the foregoing claims were filed with the Commission 
within a period of six months after each of the shipments in 
question reached its destination, but the formal petition was not 
filed until Dec. 20, 1910. The claims having thus been made 
within the period of the limitation of the statute, the running 
of the statute is stopped thereon. 

The paid freight bill shows that the first car is No. 58882, as 
alleged' in the answer, and not No. 58888, as alleged in the peti- 
tion. The number of the other cars are correctly stated in 
the petition and admitted in the answer. 

The charges on the shipments mentioned in paragraphs 3 and 
4 of the petition are based on the rate of 4% cts. per cwt., as 
provided for in respondent's tariff G. F. D. 5950— B for distances 
of over 180 mriles to 200 miles in cars under 40 feet in length 
and ovier 34 feet in length. These shipments moved from Heine- 
mann's Mill to South Milwaukee, a distance of 195 miles, and 
the legal rate for this distance is W^ cts. per cwt, which was 
exacted. The official railway equipment register gives the length 
of car No» 58882 and No. 94830 as 33 feet 6 inches. The mini- 
mum weight, as named iti revspondent'a tariff G» F. D. 6950— B 



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OSHKOSH FUEL CO. V, C. & N. W. R. CO. 225 

for cars 34 feet in length and under, at a rate of 4^/$ cts. for 
distances of 180 miles to 200 miles, is 40,000 lbs. These ship- 
ments were charged at 50,000 lbs. each, There is nothing in 
the petition or answer to show the actual weight of such ship- 
ments. 

If the actual weight of such shipments was not over 40,000 
lbs. each, the charge, according to the tariff, should be on 40,000 
lbs., at 4^/^ cts. per cwt., making $18 each, or an overcharge of 
$4.50 on each of said cars. Tariff G. F. D. 5950—6 was 
amended Aug. 25, 1910, naming a direct rate of 4 cts. per cwt., 
subject to the minimum weights above referred to, from Heine- 
mann's Mill to South Milwaukee. This rate is still in force, 
and the application of same to the shipments mentioned, based 
on weights of 40,000 lbs. each, would make a charge of $16 
each, or an overcharge of $6.50 per car, which is the amount 
claimed by petitioner. 

The shipments mentioned in paragraph 5 of the petition moved 
from Heinemann's Mill to South Milwaukee, and the charges 
were assessed upon a weight of 53,900 lbs., at 4j4 cts. per cwt., 
making $24.26. The rate asked for by petitioner, 4 cts. per cwt., 
was at the time the shipments moved the rate in effect from An- 
tigo to South Milwaukee, and later, Aug. 25, 1910, as above 
stated, put in effect from Heinemann's Mill to South Milwaukee. 
If the charges had been based on a rate of 4 cts. per cwt., the 
amount exacted would have been $2.70 less than was actually 
exacted. • i ' 

The shipments mentioned in paragraphs 7 and 8 of the petition 
moved from Heinemann's Mill to Port Washington in cars Nos. 
67722 and 11522, respectively, and were charged upon the basis of 
44,100 lbs. and 45,200 lbs., respectively, at 4^4 cts. per cwt., 
making the charges $19.85 and $20.84, respectively, or a total 
charge on both shipments of $40.19. The rate exacted is based 
on distances of 180 to 200 miles, as provided in tariff G. F. D. 
5950 — B. The actual distance from Heinemann's Mill to Port 
Washington is 185 miles. The rate claimed by the petitioner 
is the direct rate from Antigo, and later Heinemann's Mill, to 
Port Washington, Port Washington being in the same group 
and taking the same rate as 'South Milwaukee, as already stated. 
The application of the 4 ct. rate to such shipments would result 
in an overcharge of % ct. per cwt., or $2.21 on car No. 67722, 
and $2.26 on car No. 11522, making a total overcharge on batii 
16— R.D. 



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226 RAILROAD COMMISSION OP WISCONSIN, 

shipments of $4.47. There is still due, however, y^ ct. percwt. 
on such sliipments, on account of erroneous rates applied when 
the bills were paid. This amounts to $2.23, which should be de- 
ducted from the amount of the refund authorized. 

The shipments mentioned in paragraph 9 of the petition moved 
from Heinemann's Mill to Port Washington in car No. 37476, 
and the respondent charged therefor on a basis of a minimum 
of 50,000 lbs., at 4^4 cts. per cwt., making a total charge of $21.28. 
The actual weight of this shipment, as shown by the paid freight 
bill, was 38,100 lbs. The car, according to the official railway 
equipment register, is 33 feet 6 inches in length, and according 
to respondent's tariff G. F. D. 5950 — ^B is entitled to a minimum 
weight of 40,000 lbs. The true charge for this shipment, there- 
fore, should have been 40,000 lbs. at 4^/^ cts. per cwt., which 
was the rate for distances of 185 miles. The legal rate, ac- 
cording to the tariff mentioned, is 4% cts. per cwt. instead of 
414 cts. per cwt., as was charged. Upon a basis of a rate of 4 
cts. per cwt. the charge upon such shipment would be $16, or 
$5.75 less than was actually collected by the respondent. 

The shipments mentioned in the last paragraph of the petition 
moved from Hatley to South Milwaukee, in car No. 7768, and 
was charged on a minimum basis of 50,000 lbs. at the rate of 41/4 
cts. per cwt., making a total charge of $21.25. There is no dis- 
pute as to the correctness of this charge. The claim for refund 
is based upon the ground that the car is but one inch over 34 
feet in length, and therefore should be regarded as a 34 foot car. 
The minimum weight on a 34 foot car is 40,000 lbs., and the 
charge, provided the actual weight was not over 40,000 lbs., 
would be $18, or $3.25 less than was actually charged. There is 
no authority in the tariff applicable to this shipment for disre- 
garding fractions of a foot in applying the minimum weight ac- 
cording to the length of car. The only place that such provision 
can be found is in the western classification, rule 6-B, which 
provides that fractions of a foot, 6 inches or less^ should be dis- 
regarded in figuring "premium" and "deduction" charges, ac- 
cording to the length of the car used. This classification, how- 
ever, does not apply in connection with the shipment referred 
to. However, it is very apparent that the car in question was 
constructed for a 34 foot car, and unintentionally was made an 
inch longer than designed. The addition of one inch is so in- 
significant that it is unreasonable to apply a different minimum 
than that applicable to a car 34 feet in length. 



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OSHKOSH FUEL CO. V, C. & N. W. B. CO. 227 

It is conceded that the charges exacted of the petitioner arc un- 
usual and exorbitant. The fact that the point of origin of the 
freight was not included in the tariffs filed, but was only in- 
cluded by amendment thereto, was doubtless due to an oversight 
on the part of the carrier. 

We therefore find and determine that the charges exacted of 
the petitioner for the aforesaid shipments, as alleged in the peti- 
tion, are unusual and exorbitant, and that the reasonJdilu iffi^ta 
therefor are those provided in the tariffs now in effect and ap- 
plicable to such shipments. The reparation on each of the ship- 
ments mentioned is as follows : 

Car No. 58882 $6.50 

car No. 94830 6.50 

car No. 35281 2.70 

Car No. 67722 , 2.21 

Car No. 11522 ; 2.26 

Car No. 37476 5.25 

Car No. 7768 3.25 

Total $28.60 

Deduct the uncoUected account above mentioned 2.23 

Amount of reparation $26.44 

Now, Therefore, It is Ordered, That the Chicago & North 
Western Railway Ccanpany be and the same is hereby authorized 
and directed to refund to the Oshkosh Fuel Company the sum of 
$26.44, being the amount charged in excess of the rate herein 
found to be reasonable for the aforesaid shipments of slab wood 
as aforesaid. 



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228 BAILBOAD COMMISSION OF WISCONSIN. 



CITY OP RACINE 

vs. 
RHeiltftWs LIGHT COMPANY. 



Decided Jan. £7, 1911. 



The city of Racine, petitioner, alleged, in substance, that the rates 
charged by the respondent were excessive and yielded an un- 
reasonable return upon a fair valuation of the property of 
respondent; that while but one quality of gas was furnished 
to consumers in Racine, respondent compelled consumers to use 
two meters, one for registering the amount of gas used for 
fuel purposes and the other for gas used for illuminating pur- 
poses; that two rates were charged for the same gas, and pe- 
titioner demanded that the double meter system be discon- 
tinued and all gas consumed, no matter for what purpose, be 
paid for at the same rate or rates. 

Held: Whatever the reasons may have been for the adoption of the 
double meter system, it does. not appear that the conditions in 
Racine demand a continuation of this practice. When the 
meter rate is made the same for both fuel and illuminating 
gas, the necessity for the double meter system no longer exists. 

The physical property of respondent as appraised, and by subsequent 
additions and extensions, and after deducting property held 
but not used in company's business, and pavement not ac- 
tually cut through and replaced by or assessed against re- 
spondent, was determined to have a cost of reproduction new 
of $986,290, and a present value of about $907,062, of date 
June 30, 1910. 

The original cost of the plant Is an Important element in fixing a 
value for rate-making purposes. Reliable data as to original 
cost could not be obtained in this case. Book value includes 
elements which are not relevant In these proceedings. Orig- 
inal cost and cost of reproduction new, as compiled in such 
cases, are frequently found to be not far apart. 

Respondent owns a high pressure line to Kenosha and produces and 
transmits gas to the city limits of Kenosha, delivering gas at 
that point to the Kenosha Gas and Electric Company at a 
rate of 50 cts. per M cu. ft. Petitioner contended that the 
value of the equipment used in, and the cost of producing and 
transmitting the Kenosha gas should be deducted from re- 
spondent's plant value and operating costs before computing 
the rates for Racine consumers. It was determined upon an 
"additional business" basis of aDportionment that the Ke- 
nosha gas cost 70 cts. per M cu. ft., and that on a basis of ap- 
portionment which charged the Kenosha gas with a fair share 
of the overhead charges, the gas cost about 90 cts. per M cu. 
ft. delivered at Kenosha. 



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CITY OF RACINE V. RACINE! QAS UQHT 00. 229 

Held: That there is no valid reason why consumers in Racine should 
bear all or even a part of the losses incurred by respondent 
in supplying the Kenosha company. 

The cost of building up the business was given by respondent aa about 
1178,943. This amount was expended in order to secure busi- 
ness and represented losses on sales of fixtures, sales of gas 
at less than cost, and sums expended for advertising, solicit- 
ing, and in other ways encouraging the use of gas. A large 
part of the above amount had been paid out of the earnings as 
the expense was incurred; the remainder had been charged to 
the construction account or plant additions. It was found 
that if the amounts thus charged to construction by the re- 
spondent had been charged to operating expenses and paid out 
of earnings each year, respondent's net earnings, after al- 
lowing 2 per cent on the total property for depreciation, 
would have been never lower than 7.0 per cent on the cost of 
reproduction new, and would have reached 8.9 per cent dur- 
ing the highest year. 

Petitioner alleged that respondent had constructed a plant which, 
as regards certain specifically named items and as regards 
the plant as a whole, was too large for the demands of the 
business. A thorough investigation was made of the situa- 
tion in Racine and a report was submitted by the Commis- 
sion's staff, in which it was concluded that the greater in- 
vestment in respondent's plant than is required or is neces- 
sary for the service rendered, is due, not to an excessive in- 
vestment in any one portion of the plant, but to a very liberal 
investment throughout. 

Held: That the situation in this respect is such that it Is far from 
clear whether it would be equitable to all concerned to fix 
rates in this case, the receipts from which would return in- 
terest and profit on the cost of reproduction of the plant at 
as high rates as those which might ordinarily be regarded as 
adequate in cities of this size. 

An. apportionment of the expenses of respondent was made as be- 
tween "output," "capacity" and "consumer" charges, and 
unit costs of operation computed. These unit costs showed 
forcibly that, as the consumption per month per consumer 
increases, the cost per M cu. ft. supplied to him decreases. 
The unit costs also serve, to a material extent, in indicating 
what a fair and equitable rate schedule would be in this 
case. 

The minimum bill should be founded upon costs, and from this as a 
basis, it is certain that the varying investment in meters 
upon consumers' premises, due to varying demands, must be 
recognized in constructing the rate schedule. 



The petition and complaint of the above named city of Ra- 
cine, by E. R, Burgess, its attorney, alleges among other things : 

1. That the said Racine Gas Light Co. furnishes but one qual- 
ity of gas which is used both for fuel and lighting purposes. 

2. That consumers are compelled to rent two meters, one 
registering the amount of gas used for fuel and the other the 
amount of gas used for lighting purposes. 

3. That two rates are charged by said company; the rate for 



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230 RAILBOAD GOMMISSION OF WISOONQIN. 

lighting purposes being $1.20 net per thousand cubic feet; the 
rate for tuel pui-poses being $1.00 net per thousand cubic feet. 

4. That from a comparison of rates charged by other com- 
panies in different cities of the state for gas, and taking into 
consideration the advantages which the Racine Gas Light Co. 
has by way of shipping facilities and the large amount of gas 
manufactured and sold, the complaint alleges that tlie rates 
charged in the city of Racine by the respondent company arc 
excessive and unreasonable. 

5. That many complaints have been received by tlie city au- 
thorities from constmiers of the respondent company in regard to 
the accuracy of the meters used tor registering the amount of 
gas consumed by said consumers, and that from the test made by 
an expert in the months of July and August, 1907, it was found 
that 75 per cent of the total number of meters so tested were 
found to be running fast. 

Setting forth the complaints as above stated, the petitioner 
then asked that the Commission order the respondent company: 

1. To lower its rate for gas in the city of Racine. 

2. To furnish meters which will accurately register the amount 
of gas consumed. 

3. To charge but one rate for gas consumed, whether it be 
for fuel or lighting purposes. 

Pursuant to notice a hearing was held on the above matter 
at the office of the Commission, at which hearing the following 
appearances were entered: £. R. Burgess, city attorney, for 
petitioner; and C. M. Rosecrantz for respondent. 



DESCRIPTION OF PLANT. 

It appears that the Racine Gas Light Company was first or- 
ganized in 1867 and began selling gas Feb. 28 of that year. The 
plant and business came into control of the present management 
about July, 1899. Before this date the sales had been compara- 
tively small and the business was undeveloped. The new man- 
agement began an aggressive campaign for new business, with 
the result that the number of consumers and total sales increased 
very rapidly. 

The present gas plant was built about the year 1900. At that 
time all of the present buildings were erected. The machinery 



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CITY OF KACINB V. RACIMB GAS UGUT CO. 231 

installed, however, was only about one-half of the ulthnate ca- 
pacity of the plant as planned. The present exhausting machin- 
ery was put in at the above date and a 400,000 cubic foot holder 
erected. Two stacks of five benches of six retorts each were in- 
stalled, having a capacity of 500,000 to 600,000 cubic feet. 

About 1904 an additional stack of five benches was installed 
and additional condensing machinery was put in. In 1907 a new 
holder of 1,000,000 cubic feet capacity was added. About this 
time a contract had been made with the Kenosha Gas and Elec- 
tric Company, under which contract the Racine plant was lo 
supply a portion of the gas required in Kenosha. For the ful- 
fillment of this contract a six inch high pressure line was laid 
from Racine to Kenosha, a distance of about ten miles. 

The total number of consumers now taking service from the 
Racine Gas Light Co. is in the neighborhood of 7,000. Ex- 
clusive of the high pressure line to Kenosha, the Racine com- 
pany has laid about 67 miles of mains. The total amount of 
gas delivered to the mains is about 232,000,000 cubic feet per 
year, the average daily production being about 626,000 cubic 
feet. The total earnings from the sale of gas and residuals for 
the last fiscal year was reported as $273,936.51, while total op- 
erating expenses, not including interest and depreciation, came to 
$177,696.06. 



RATES NOW IN EORCE. 

The following schedule of rates was filed with the Commis- 
sion Sep. 1, 1909, and is still eflfective. There appears to have 
been no change in the schedule since that date. 

R.\ciNE Gas Light Company Schedule of Rates and Charges 

Regular Local Consumers. 
Illuminating : 

For any amount $1.40 per 1000 cubic feet. 
Fuel: 

For the first 10,000 cubic feet used during any one 
month, through any one meter, a rate of $1.20 per 1000 
cubic feet, l^or any amount over 10,000 cubic feet and 
up to 30,000 cubic feet used during the same month, 
through the same meter, a rate of $1.00 per 1,000 cubic 
feet. For all additional consumption over 30,000 cubic 



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232 ftAILROAD COMMISSION OF WISCONSIN. 

feet and during the same month, through the same meter, 
a rate of 80 cts. per 1,000 cubic feet. 
Discount : 

A discount of 20 cts. per 1,000 cubic feet will be al- 
lowed from the above rates, provided bills are paid at 
the office of the company on or before the last discount 
day as specified on the bill. 

The Xet Rates are, then, as follows: 
Illuminating: 

Any amount $1.20 per M cubic feet. 
Fuel : 

First 10,000 cu. ft. $1.00 per M. 

Next 20,000 cu. ft. .80 per M. 

All over 30,000 cu. ft. .60 per M. 

Intcrurban Customers. 

The schedule of rates for interurban customers varies 
from the schedule of a regular local customer only as re- 
gards the rate per M for illuminating gas. The scale and 
discoimt system are the same in both schedules. The net 
rates for interurban customers are as follows: 
Illuminating: 

Any amount $1.50 per M cu. ft. 
Fuel: 

First 10,000 cu. ft. $1.00 per M. 
Next 20,000 cu. ft. .80 per M. 

All over 30,000 cu. ft. .60 per M. 

Special Rates. 

City of Racine : 

In city hall and fire department houses. For any 
amount for any purpose, flat rate of $1.00 per 1,000 cubic 
feet. Same is paid for monthly on approval of bills by 
common council. 
U. S. Government: 

Prices are the same as for regular local cus'tomers. 
Bills are paid quarterly instead of monthly. 
Kenosha Gas & Electric Co. : 

For any amount for any purpose a net price of 50 cts. 
per 1,000 cubic feet delivered to their mains at north 
limits of Kenosha. 

Minimum Charge. 

All regular local and all interurban customers are sub- 
ject to a minimum charge where the consumption per 
meter is less than the amount designated in the table be- 
low, and according to the size of the meters in service : 



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CITY OP RACINE V. RACINE GAS UOHT CO. 



233 



Size of meter. 



Amount to 
be charflred 
eacli month. 



Where 

consumption is 

less than 



3 li«rht . 
5 Ueht . 
10 IWht . 
20 lUrht . 
30 light . 
45 llfrht . 
00 light . 
60 l\ght . 
100 lisrht . 

aoo ii«rht . 



10.25 


200cu.ft. 


0.25 


200CU. ft. 


0,35 


300CU. ft. 


0.36 


300CU. tt. 


0.50 


400 cu. ft. 


0.60 


500 cu. ft. 


1,00 


900 cu. ft. 


1.60 


1200 CU. ft. 


2.00 


1500 cu. ft. 


4.00 


3200 CU. ft. 



VALUE OF PLANT. 

A tentative valuation of the physical property of the Racine 
Gas Light Co. has been made by the engineering staff of the 
Commission. This valuation is of date July 1, 1908, and is re- 
produced below: 

TABLE I. 

TENTATIVE VALUATION OF THE PHYSICAL PROPERTY 
or THE Raoinb Gas Light Ck), 



Classification. 


Cost of 
reproduction. 


Present 
value. 


1 Land... 


127,896 
379.496 
124.. %9 
62,624 
,S,770 
9,037 
5,645 


$42,250 


2. Intake 


544 


3 Holders. 


125,197 


4. Distribution system 


844.131 


5 Plant etiuiDment 


107,221 


6 Bldgs. and misc. structures 


70.260 


7 Office furniture and aoDliances 


2,940 


8 Tools and Instruments 


6,476 


9. Hors€»s, wa^ns and misc 


4,975 






Total items 1-9 


$774,630 
92,956 


$703,994 


10 Add 12 %(see note below) 


84,479 






Total items 1-10 


1867,586 
40,630 


r88,4r8 


1 1 Stores and supi>l les 


40,516 






Total items 1-11 


1908,216 
27,794 


$828, 9H9 


12. Paving 


26.404 






Total Items 1-12 


1096,010 
15.370 


$855,393 


Real estate held, but not used in company's business 


15,370 


Grand total 


$951,380 


$8^0.763 







Note: Addition of 12 per cent to cover enirineerinir, supervision, Interest durins: 
construction, contingencies, etc. 

The foregoing valuation of the physical property of the re- 
spondent was introduced at the hearing and constituted the 
basis upon which the testimony and arguments of the parties to 
the complaint were submitted. 



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234 RAILROAD COMMISSION OP WISCONSIN. 

Ill regard to the above valuation a wide difference of opinion 
arose as between the petitioner and the respondent. The peti- 
tioner contended: (1) That there are certain items included 
in the valuation that ought to be eliminated entirely; (2) that 
a portion of the value of certain other items should be elimi- 
nated; (3) that the valuation placed on other items is too high. 

Respondent, on the other hand, sought to show that not only 
were some items contained in the tentative valuation placed at 
too low a figure, but that the tentiative valuation failed to in- 
clude several elements which should be considered in a valuation 
for purposes of rate making. The items in dispute will be dis- 
cussed separately. 

Land. 

The land owned by the respondent is detailed in the tentative 
valuation as follows: 

Land (used in business). — Lot in blk. 4 — Harbor addition — 
15% used; cost of reproduction and present value $2,250. — Land 
in blks. 7 and 67 O. P., occupied by gas works — cost of repnxluc- 
tion and present value $40,000. — ^Total value of land used in busi- 
ness, $42,250. 

Real estate held but not used in company's business — $15,370, 
cost of reproduction and present value. 

The petitioner contended that the value of the lot in block 
4, Harbor addition, should be excluded from the valuation, bas- 
ing this claim on the testimony of several witnesses to the effect 
that the lot in question is not at the present t'me used by the re- 
spondent. Henry H. Hyde, then manager of the respondent 
company, testified that the Racine Gas TJght Company owned six 
lots in block 4, known as the Harbor addition ; that on July 1 , 
1908, the date of the tentative valuation, the company used one 
lot in block 4, upon which was located a meter repair shop, and 
another building used as a store house for gas ranges; that 
these buildings have since been removed and that at the time of 
the hearing the lot in question was occupied by no building or 
buildings. Witness declared, however, that although the lot in 
question had no building upon it, it was nevertheless used and 
useful to the company in its business. 

It appears that this block 4, Harbor addition, is located a little 
distance from the gas works land proper and is, in fact, a sepa- 
rate piece of property. It appears also that at the present 
tinic this area is used by the company for storage purposes, for 



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^ CITY OP RACINE V. RACINE GAS LIGHT CO. 235 

pipe used in the distribution mains. Whether it is necessary for 
the company to use this land for the storage of pipe, or whether 
any advantage accrues to the plant by its use for this purpose, 
is not clear. It does seem clear, however, that the company 
would not be greatly inconvenienced if the lot in question were 
not available. The value of the land held but not used, amount- 
ing, to $15,370, has not been included in the valuation, and the 
effect of including or excluding the yalue of the lot in question, 
amounting to $2,250, may be said to be negligible, so far as the 
basis of rate making is concerned. 

Breakwater. 

It appears that the company has constructed a breakwater 
extending some distance out into the lake, which, together with 
other similar structures, is designed to protect the company's 
property and plant from the destructive action of the waves of 
LaJce Michigan. * The city contended that the Racine Gas Light 
Company has a much larger investment in breakwaters than is 
necessary for protecting the land owned by the company and 
for protecting the plant and other property. In connection with 
this breakwater investment a map of respondent's property, 
showing the location of the gas works, holders, breakwaters and 
shore line, was submitted. The city called attention to the fact 
that the respondent has constructed a double row of piling out 
into the lake parallel with the shore line, the entire length of 
respondent's property. The map also shows that this break- 
water is connected with the shore by a breakwater running from 
the north line of respondent's property. On the south line of 
the respondent's property another breakwater extends out nearly 
to the southern extremity of the first breakwater described, 
which IS parallel to the shore line. It is contended by the city 
that this arrangement of breakwaters, and the large investment 
therein, was primarily made by the company to make more land 
rather than as a protective measure, since, as petitioner argues, 
the extension of the breakwaters so far out into the lake was 
unnecessary for the protection of. the property and plant of the 
company. The contention of the city is, that this extraordinary 
expense incurred by the company for breakwaters, or at least the 
greater portion of it, should not be included in a valuation for 
the purpose of fixing rates for the present consumers, but should 
be treated as -an investment for the future. 



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236 RAILROAD COMMISSION OP WISCONSIN. 

'J1ic respondent contends that the breakwaters were extended 
because actual experience demonstrated the necessity of such 
extension. Respondent pointed out that the shore line of the 
lake was shifting and variable, and that after the first portion of 
the breakwater had been completed the water actually came to the 
foundation wall of the plant, and an extension of the breakwater 
was necessary to prevent the undermining of the walls. Testi- 
mony was introduced to show tbat, had the breakwater not been 
constructed as it now is, the severe storms from the lake would 
have caused the waves to reach the gas holder. It was also 
brought out at the hearing that during one particularly severe 
storm the water cut in the shore forty feet. Briefly, the com- 
pany claimed that the extending of the breakwater a greater 
distance into the lake was necessary and afforded better protec- 
tion for the property and plant. It was further asserted by the 
respondent that the only land not used by the company in the 
area enclosed by the breakwaters is that portion which is sub- 
merged. It was stated that the land not submerged, and which 
is not occupied by the holders or gas works, is used for the stor- 
age of tar barrels, etc. 

In the tentative valuation the cost of the breakwaters seems 
to be covered by the three items shown below : 





Cost of 
reproduction. 


Present 
value. 


Main breakwater 


|9.e()8 
3.150 


17.782 


Hid© breakwater 


4.455 


Inside win; walls 









Total . . . ... 


I1.S.25S 


$12,237 







That the breakwater in question has created in the past and 
will create in the future considerable valuable land, will not be 
disputed. That a breakwater is needed to protect the property 
and plant of the respondent, is conceded. It is not clear, how- 
ever, that the present arrangement of breakwaters is the most 
advantageous in order to fully protect the property of the re- 
spondent both now and in the future. The fact that tlie break- 
v^ter has been so constructed and extended as to make it possi- 
ble for respondent to increase its land holdings, is not, of itself, 
sufficient to show that it is not so located and designed as to 
best protect the plant and property of the company. 



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CITY OF fiACINE V, BAUINE GAS LIGHT CO. 237 



Mains. 

Petitioner challenged the valuation of the distribution mains 
in respondent's system as reported in the tentative valuation. 
The petitioner contended, first, that an erroneous standard of 
weight per lineal foot was used for those mains laid prior to 
1905 ; second, the price per ton of the pipe as allowed in the ten- 
tative valuation is excessive. 

Alton D. Adams, consulting engineer, testifying in behalf of 
the city, stated: 

"Unless the records of the company show that a 20^^ lb. pipe 
of 4 inch size was used in all old pipe, why, it looks to me very 
unreasonable to adopt any such weight as is adopted here (re- 
ferring to the tentative valuation) for the cast iron pipe, because 
the general practice as indicated by the adoption or recommenda- 
tion of the standard * * * by the Western Gas Association 
and the catalogues of the leading manufacturers * * * and 
the weight givea in engineer's hand books * * * as 17 lbs. 
per foot, would indicate to my mind a probability that the 4 inch 
pipe laid before 1905 was no more than 17 lbs. per laid foot.*' 

The manager of the company testified that the weight of the 4 
inch pipe laid by the respondent, averaged over a period of five 
years (1904 to 1908, both inclusive), showed the average weight 
as 19.3 lbs. per lineal foot. Petitioner asserts that if a change 
was made in 1905 by the manufacturers of gas pipe, making the 
pipe heavier than formerly so that the weight was made 20 lbs. 
per foot rather than 17, the average weight for the years 1904 
to 1908, inclusive, would be about 19.6 lbs., which corroborates, 
if anything, the testimony of Mr. Adams. 

It appears that no pipe was actually weighed in connection with 
the investigation by any of the parties interested or concerned. 
Very little light has been thrown upon the matter of the weight 
of the pipe used before 1905, outside of the standards used at 
that time as mentioned in the testimony of Mr. Adams. It ap- 
pears that the staff used a weight of 20 lbs. per lineal foot for 
4 inch pipe in the calculations on the valuation of respondent's 
distribution system, which is the weight listed in the catalogue of 
one of the leading manufacturers of cast iron pipe. In the light 
of the g'eneral practice of the respondent, as evidenced by its 
plant today, it would not be surprising if a heavier pipe than the 
then existing standard was used by the company prior to 1905. 

From the records of the company and those gathered by the 



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238 RAILROAD COMMISSION OF WISCONSIN. 

staff in its investigations it appears that the company had about 
51 miles or approximately 270,000 feet of main pipe laid prior 
to 1905. Using a price of 1^^ cts. per lb. and a difference of 3 
lbs. per foot, the difference in the cost of the pipe between that 
secured on a 20 lb. basis and on a 17 lb. basis, would appear to 
be about $12,150. This amount is obtained by assuming that all 
the sizes will show the same difference in weight per foot as the 
difference claimed in the 4 inch pipe. As a matter of fact, how- 
ever, it appears that the difference is not the same for all sizes 
of pipe, some sizes nmning larger and others smaller as regards 
the difference in weights per foot under the two standards. 

The price paid for the 4 inch pipe was also a matter of dis- 
pute. The cost of this size of cast iron main is given by tlie 
staff as $31.99 per ton, with a cost of trenching and laying of 
22'/$ cts. per lineal foot. The petitioner claimed that the above 
price was excessive and sought to show this excessiveness by the 
testimony of its principal witness, Alton D. Adams. 

The methods of the staff in determining the prices of cast 
iron pipe and other material have been dealt with in previous de- 
cisons of this Commission, and it seems unnecessary to go into 
the details herein. The matter of ''basis of prices" has been 
discussed fully in the decision of the Commission, City of Ap' 
plcton V. Applcton Water Works Co. 5 W. R. C. R. 215, 228- 
235. In this decision the prices used on cast iron pipe have been 
discussed specifically. 

Paving. 

The tentative valuation makes an allowance of $27,794, cost of 
reproduction, for paving. This estimate covers 89,177 lineal feet 
of paving, described and detailed as follows : 

12,926 lineal ft. macadam at 5 cts $646 

8,702 " limestone at 33 cts 2,872 

47,995 " brick (with macadam foundation) at 23 cts 11,039 

8,550 " brick (concrete foundation) at 48 cts 4,104 

11,004 " asphalt at 83 cts 9,133 

ToUl $27,794 

The city, by its witness P. H. Connolly, city engineer of the 
city of Racine, offered testimony to show that the above allow- 
ance for paving was too large by $15,791. The estimates of this 
witness were based, to a large extent, upon actual experience in 



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CITY OF BACINE V. RACINE GAS UGHT CO. 239 

paving work in Racine. Witness gave as his estimate of the 
cost of relaying macadam, figuring on a trench 2 feet wide, 
as roughly 2 cts. per lineal foot, as opposed to the 5 cts. per 
lineal foot used by the staff. Witness' estimates in the differ- 
ent k'nds of pavement are summarized below : 

Connolly's Figures. 

Cbst per lineal ft 

Macadam 2 cts. 

Limestone * 4.5 " 

Brick (macadam foundation) 5.6 " 

Brick (concrete foundation) 22 " 

Asphalt 43.5 " 

Witness stated that these figures were based upon experience 
in relaying pavements in connection with work done by the 
hoard of public works in Racine. The estimates include labor 
at $1.75 to $2.00 per day, but do not include any new material 
and do not make any allowance for overseeing expenses. 

The respondent, by its manager, introduced testimony to show 
that the tentative valuation failed to allow a sufficient amount 
of paving to cover the actual work which had been done by 
the company. Witness declared that the company had laid or 
relaid, at its own expense, 215,862 lineal feet of pavement, which 
amount consisted of 123,823 feet over mains and 45,440 feet over 
services. Witness declared further that there was an additional 
amount of paving which was due to the fact that in taking up 
and relaying cedar blocks laid upon planks, it was found neces- 
sary to take up the blocks to the full length of the plank and 
relay the same. If the pavement was old, it was often found 
necessary, witness declared, to put in considerable new material 
upon relaying. For this class of paving the witness claimed 
92,039 lineal feet over and above the two foot trench allowed 
in the tentative valuation. 

The estimates of three contractors doing business in Racine 
were submitted by the respondent. These contractors were rec- 
ognized by the city engineer as reputable and reliable. The es- 
timates of these contractors are shown below : 



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240 



RAILROAD COMMISSION OF WISCONSIN. 



Pavement. 




CONTBIOTOR 




Jones. 


Cape. 


Blrdsall. 


Macadam 


10.18 
.18 
.30 

M 
.17 
.28 


10.11 

.11 
.11 
.28 

:?? 

.3B 


10.13 


Limestone 


.17 


Brick on macadam 


.14 


Brick on concrete , 


.31 


AsDhalt 


.66 


Cedar blocks on planks 


.11 


Cedar blocks on concrete 


.28 







In order to afford a comparison of the several estimates ad- 
vanced in this matter of paving, the following tabulation has 
been prepared. In this table the prices given by Jones, Cape 
and Birdsall have been averaged. 





PRICES PER LINEAL FOOT. 




Pavement. 


Averaure of 

Jones, Cape 

and Blrdsall 

estimates. 


Tentative 
valuation. 


City 
en^rlneer. 


M^^milam,. .,,.. ,... 


$0.14 

.m 

181 
.314 
.Utf 


.23 
.48 
.83 


10.02 


Limestone 


.045 


Brick on macadam 


056 


Brick on concrete 


.22 


Asphalt 


435 







One is impressed by the wide divergence of views on the cost 
of paving as revealed by the above comparison of estimates. 
These estimates have been made by men all more or less familiar 
with this kind of work. It is difficult, therefore, to reconcile the 
differences apparent in the prices above quoted. 
- In connection with the question of paving the Commission 
has expressed an opinion, repeated in several decisions, which 
opinion has an important bearing on the situation in this case. 
The Commission has held previously: 

**Every legitimate expenditure in adapting the utility to the de- 
mands of progress and community growth is a proper charge to 
construction and as such the investment therefor is entitloi to 
participate in the distribution of the earnings from operation. 
Obviously expenditures for pavement incurred by the utility in 
response to assessments levied therefor by the city, or the cost of 
cutting through such pavement for construction purposes and its 
replacement, are proper capital charges. It does not necessarily 
follow that the utility is to capitalize expenses for municipal bet- 



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CITY OF RACINE V. RACINB QAS LIQHT 00. 241 

terment in which it has not participated and where such accruing 
benefits to the utility are remote and incidental, and thus compel 
the subscribers for utility service to pay increased rates because 
of public improvements. The improvement is not a proper ele- 
ment of value where the pavement has not been paid for by the 
utility, nor any expense in connection with it directly incurred, 
in determining a value which shall serve as the basis for an ad- 
justment in rates." City of Ripon v. Ripon Light and Water 
Co. 5 W. R. C. R. 1, 10. 

In view of the above opinion by this Commission an investiga- 
tion, was ordered as to the actual paving work done by the re- 
spondent in this case. The following memorandum has been 
submitted by the staff: 

"EflForts were very recently made to learn, directly from the 
records in the office of the Racine Gas Light Company, as to the 
amount of paving of each kind which the company has had to 
take up and relay in connection with the construction of mains 
and services, together with the actual cost of this part of the 
work. The records of the present company began June 1, 1899, 
when the present owners obtained the property, and it was im- 
possible to determine what mains laid prior to that date were laid 
at an expense for paving. It was apparently impossible to deter- 
mine definitely the jimounts of paving which have been disturbed 
by the gas company since June 1, 1899, but it appears, from an 
examination of the company's "main orders" an-d the city's pav- 
ing statistics, that the following amounts and expenses are be- 
lieved to fairly represent the actual paving work encountered by 
the gas company: 

Racine Loio Pressure System. 

5,767 ft. cedar block on plank at 12 cts |692 

482 " " on concrete at 35 cts 168 

6,747 " limestone block at 33 cts 2,227 

428 " macadam at 5 cts 21 

271 " brick at 23 cts 62 

124 " asphalt at 88 cts 103 

Total $3,273 

Racinc-Kcnosha High Pressure Line. 

170 ft. cedar block at 12 cts. $20 

1,980 ft. macadam at 5 cts 99 

325 ft. brick at 23 cts 52 

Total $171 

16- R. D. 



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242 railroad commission op wisconsin. 

Services. 

The city criticized the valuation of the gas services. The val- 
uation of this portion of the plant is reported as follows in the 
tentative valuation: 

5,731 partial services (street portion of complete service) 

at $6.60 $37,825 

681 curb services at $4.67 3, 180 

287.6 tons— freight and cartage (portion services in street) at 

$1.10 316 

Total cost of reproduction $41,321 

Total present value $34,710 

Joseph Flynn, a witness called hy the city, testified that the 
cost of the partial services given by the staff as $6.60 per service 
should be reduced to $3.90 per service. Witness also declared 
that the cost of $4.67 for curb services was excessive and should 
be reduced to $3.19. 

As regards the cost of that portion of the services on cus- 
tomer's premises, or inside of curb, the tentative valuation gives 
the following prices : 

5,731 partial services (portion of complete services in private 

grounds) at $2 91 $16,677 

152.5 tons freight and cartage at $1.10 168 

Total cost of reproduction $16,845 

Total present value $14,150 

The same witness, Joscj)!! Flynn, stated that he had not es- 
timated on the cost of house services, the portion covered by the 
above statement. 

It appears that this witness, Joseph Flynn, was connected with 
the Racine Gas Light Company from 1902 to 1908, as general 
foreman and had charge of the laying of pipes in streets, piping 
of houses, setting meters, etc. Witness stated that he had never 
done any of the work of the nature above described other than 
as an employe of the Racine or Kenosha gas companies. It ap- 
peared that the witness had never made or kept any records of 
the cost of installing services when he was doing that kind of 
work. Witness had no definite recollection of any data as to 
any particular places where services were installed, nor had he 
any definite recollection as to what items were included in his 
calculations, and could not rememl:>er when it had last made any 
estimate as to the cost per yard. 

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CITY QP RACINE V. RACINB GAS UGHT CO. 243 

In view of the facts in regard to the cost of services, as 
brought out in the hearing and by subsequent investigations, we 
see no good reason why the tentative valuation of the services 
should not be accepted. 

Interest During Construction, Engineering, Contingencies, 

Etc. 

The tentative valuation shows that an allowance of 12 per 
cent on the cost of the physical property of the company has 
been made to cover such items as interest during construction, 
engineering, expenses for legal work, organization, casualty in- 
surance, omissions and contingencies. This allowance was at- 
tacked by the city and some testimony was brought to show that 
the allowance was excessive. This Commission has taken up this 
matter and discussed it in detail in the decision State Journal 
Printing Co. v, Mcdison Gas and Electric Co. 4 W. R. C. R. 501, 
540-546. After careful investigation of the situation in Racine, 
it appears that the opinion of the Commission in the above 
named case covers the matter fully and there appears no need of 
going into the question herein. In view of the facts, the allow- 
ance of 12 per cent should stand. 

The Kenosha Line. 

The respondent, Racine Gas Light Company, not only pro- 
duces and distributes gas for consumers in the city of Racine, 
but also produces and transmits gas for the city of Kenosha. 
The respondent company owns the high pressure line to Kenosha. 

It appears from the testimony that this line is used for the 
purpose of supplying consumers with gas along the route between 
Racine and Kenosha in addition to supplying the Kenosha com- 
pany with gas for re-sale to Kenosha consumers.. 

It was pointed out by the petitioner that there were certain 
items of property in respondent's plant which were devoted ex- 
clusively to the production or transmission of the Kenosha gas. 
These items, petitioner asserted, should be deducted from the 
valuation of respondent's plant to arrive at a fair valuation for 
rate-making purposes for the consumers in Racine. Petitioner 
further contended that there were numerous other items of 
property which, while not devoted exclusively to Kenosha Gas 
production or transmission, were used in common for both the 



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244 SAILBOAB OOMIilSaON OF WISOONSIN. 

Racine and Kenosha service. Petitioner therefore claimed that 
a portion of the value included in the items land, intake, holders, 
plant equipment, buildings and miscellaneous structures, of&ce 
furniture and appliances, tools and instruments, horses, wagons 
and miscellaneous, should be deducted from the total value of the 
plant, for the reason that the gas which is transmitted to Keno- 
sha has its share in the investments in the above items; also, lo 
some extent, in the value of the items included under stores and 
supplies, and paving. 

In answer to the above assertions and claims of the city tlie 
respondent argued that the production and sale of the gas trans- 
mitted to Kenosha tends to create a use for the plant at Racine 
and tends to make it usable to its full capacity, and, therefore, 
tends to decrease the cost of production. Respondent asserts 
that the fact that a large amount of the gas supplied through 
tJie high pressure line goes to the Kenosha company for re-sale, 
does not warrant the exclusion of the line from valuation any 
more than it would be proper to exclude a main furnishing only 
power gas or industrial fuel gas. Respondent further asserts 
that the only question open in connection with the Kenosha line 
is, whether or not the rate to the Kenosha company is, under 
the circumstances, discriminatory. 

It is suggested that for all practical purposes the Kenosha 
company is a consumer of the respondent and should occupy the 
same position as that accorded to the other consumers, the differ- 
ence being in this case that, while the small consumer in Ra- 
cine demands no special mains or equipment for his particular 
demand, the Kenosha company, on the otKer hand, requires a 
special high pressure line, and the large amounts of gas which 
must be produced to meet its demands necessitates a large part 
of the investment in respondent's plant in Racine. 

In determining what shall be the proper rates for water, gas 
or electricity k is necessary to apportion the expenses of the 
utility supplying such service over the several classes of con- 
Himers. It is the practice in fixing rates for electric current, 
for example, to divide the consumers into well defined groups or 
classes, such as street lighting, commercial lighting, commercial 
power, street railway, etc. Such a division of expenses arises 
from the well-recognized fact that these groups or classes demand 
each their special equipment or class of service and make particu- 
lar demands upon the central station. These divisions constitute 



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CITY OF RAaNB V. RACINE GAS LIGHT CO. 245 

in every way a logical and reasonable, besides a physical basis for 
the separation of expenses. Many costs are peculiar to certain 
kinds of service and niciy, therefore, be charged directly to that 
service, while other costs are general or overhead expenses, com- 
mon to two or more branches, and must be equitably apportioned 
between these several branches. Rates for service should be 
based on the cost of rendering such service, generally speaking, 
and it follows that the closer we are able to determine the cost 
of each class of service, the nearer we shall approach to a true 
and equitable rate for this service. 

The Kenosha company is a large consumer of the respondent. 
To supply the Kenosha company requires special equipment. 
The cost of supplying gas to the Kenosha company should not 
be borne by the consumer in Racine. In view of these facts it 
is clear that an apportionment of the expenses of the company 
between the Racine and Kenosha business must be made. Since 
such expenses as taxes, depreciation and interest on the invest- 
ment depend directly upon the value of the property and plant 
or, in other words, upon the investment, it is evident that an ap- 
portionment of the expenses between Racine and Kenosha in- 
volves a careful separation of the value of the physical property 
between the two services. Such a separation will be made later 
in this decision under the head "Apportionment of Expenses.'* 

Pi^ANT AS A Whole. 

Throughout the hearing and discussion following the com- 
plaint in this matter the city has repeatedly asserted that the 
respondent company has, as regards certain specifically named 
items and as regards the plant as a whole, made the mis-take of 
building a plant too large for the demands of the business. 
Petitioners declared further that the consumers in Racine should 
not be compelled to pay rates on an investment which is larger 
than the conditions require and that the probable future growth 
will justify. It is at once apparent that any opinion as to the 
question of over-investment in any business, where such over- 
investment, if it exists, will so largely affect the matter of rates, 
cannot be based upon anything but a most thorough and careful 
investigation. Such an investigation has been made in this in- 
stance. This investigation has extended over a considerable 
l>eriod of time and has covered every phase of the company's 
past growth and probable future development and has covered 



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246 RAILROAD COMMISSION OP WISCONSIN. 

a study of the company's property and plant from ilic production 
end to the distribution and supplying of consumers. 

A report has been made by the Commission's engineering staff, 
which covers the results of the investiga>tion above describe 1. 
Tliis report is reproduced below : 

Racine Gas Light Cotn(>any. 

PROGRESS REPORT. 

"Aside from the question of the investment for Kenosha, the 
city of Racine raised the question of over-investment in the 
equipment used for supplying R-acine itself. It is a comparatively 
simple matter to state the capacity of the manufacturing equip- 
ment. The capacity of the mains is more difficult, since the 
mains must be laid to take care of future growth, and consider- 
able difference of opinion exists as to how much allowance 
should be made for future growth in determining the size of 
main laid. 

"The capacity of the various parts of the manufacturing 
equipment has been stated. It will be seen that the capacity of 
a considerable part of the equipment is still considerably in ex- 
cess of the demand put upon it. The benches have not been 
greatly in excess of capacity, in fact, during the last year or 
two they have been very well loaded. With the installation of 
five new benches, however, the plant will have a daily capacity in 
the retort house of something more than 1,000,000 cu. ft. daily, 
which will be ample for some time to come. In enlarging any 
gas plant it is necessary to install units of a suitable size, and 
the increase in capacity added at any time depends upon the size 
of the unit which it is practicable to install ; for example, in the 
retort house it would be. in general, impracticable to increase the 
capacity by less than 50,000 cu. ft. at a time, the capacity of one 
bench of sixes. It is not, however, necessary to add five benches 
at a time. There appears to be no reason why retort houses 
should not ^^ '^lid out so that in small plants one bench can be 
added at a time. In larger plants, where through retorts are 
used or benches are set back to back, it may be necessary to add 
two benches at a time. The cost per bench does not appear to 
be much different whether one bench or ten benches are built at 
once. The arrangement of the retort house in Racine does not 
appear to be economical of space. In a retort house of that size 
it is not usual to find rear cHnkering benches. Benches are usu- 
ally built back to back, and are either three-quarter or full depth, 
.so that they may be clinkered below the operating floor. The cost 
of a three-quarter depth bench, front clinkcring, or a one-half 
depth bench, rear clinkering, is substantially the same. The floor 



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CITY OP RACINE V. RACINE GAS LIGHT CO. 247 

space necessary for the housing of the two types is, however, 
greatly in favor of the front clinkered type. 

"In regard to exhausting machinery, it is necessary to install 
in plants the size of the Racine plant units larger than 50,000 
cu. ft. The capacity of the exhausters in use at Racine is about 
500,000 cu. ft., and it would not appear wise to consider installa- 
tions of smaller units. It is good practice to have at least one 
exhauster in reserve, so that it appears that the investment in 
exhausters at Racine is not excessive. As a matter of fact, an- 
other exhauster will be required in the near future. 

"It appears to be general practice to increase the capacity of 
condensing systems by duplication, but it is not necessary in 
every case to install at one time a complete dupli-cate set of con- 
densing machinery. Here, too, it is possible to increase capacity 
by units of reasonable size. The condensation is best ac- 
complished by the gradual cooling of the gas through several 
condensers. In installing a plant, a plan frequently followed is 
to put in at first only part of the apparatus and to add the re- 
mainder as required. For example, suppose that four con- 
densers, a tar extractor, a washer, and two scrubbers are ar- 
ranged for in the design, which will give, when installed com- 
plete, a condensing capacity considerably in excess of present 
needs. The first two condensers frequently are arranged so that 
they can be used with either air or water. The two later con- 
densers are usually of the water tube type. In the beginning 
probably one air and one water tube condenser are installed. 
The capacity of the air condenser in warm weather may be in- 
creased by the use of water. When this no longer gives satis- 
factory condensation, a third condenser is installed, and finally, 
when the demand requires it, a fourth condenser completes the 
installation. When the growth of the business demands it, it 
becomes necessary to install a duplicate system, but here again 
it is not necessary to install all of the machinery at once. Prob- 
ably an additional condenser and scrubber will meet the require- 
ments for several years to come. Sometimes it proves desirable 
to install mechanical scrubbers. * 

"There is, however, one fact which should not be lost sight 
of. The depreciation of condensing machinery is largely inde- 
pendent of the amount of gas manufactured, provided the equip- 
ment is in use constantly or even periodically. The gases pass- 
ing are very corrosive, and the corroding action is largely pro- 
portional to the time exposed and not to the quantity passed. 
This renders it inadvisable to provide condensing capacity greatly 
in advance of the need for it. When the Racine company had 
just about reached the capacity of the condensing system, they 
immediately built the largest condensing system that they could 
get into the building, a capacity which, as a matter of fact, they 
will not require during the life of the original 600,000 cu. ft. in- 
stallation. The reason given for installing this capacity was, that 



Digitized by VjOOQIC 



248 BAILBOAD OOMMISSION OF WISCONSIN. 

they bought it cheap, but it appears that interest and depreciation 
within three years counterbalanced the effect of the bargain. 
One additional condenser and one additional scrubber of the 
size included in the second installation would have met the re- 
quirements up to the present and would have saved interest and 
depreciation on about $8,000. 

*'In regard to purifiers the conditions are very largely similar 
to those of condensing apparatus. A purifying plant always has 
two boxes. Increased capacity may be secured by adding one 
additional box or any number of additional boxes. It is not 
usually necessary to add more than one box at a time, and its 
capacity need not be more than one-half the capacity of the origi- 
nal installation. Steel purifiers are much less expensive than 
the old cast iron purifiers and are largely supplanting them. 
In Racine the company secured, by building circular steel purifi- 
ers when they increased their capacity, a capacity of 1,250,000 
cu. ft., as against 750,000 cu. ft. in the original installation, at 
one-half the total cost. It would seem, however, that here again 
the company increased the capacity largely because the cost of 
large capacity was small. Purifiers have a long life, and should 
Racine finally manufacture all the gas used in Kenosha, the 
capacity of the purifiers will be reached in about twenty years. 

'*In regard to holder capacity, it is the opinion of engineers 
that good practice requires a holder capacity of about one day's 
output, and that, in general, the minimum should not be less 
than 80 per cent of the day's output. However, many compa- 
nies operate successfully with less holder capacity than this. The 
holder capacity in Racine is over 1,400,000 cu. ft. and is al- 
most twice the maximum daily output. The cost of holders per 
thousand capacity decreases as the size of the holder is increased^, 
and the company apparently considered it justifiable to invest in 
a large holder. They were probably influenced in this by the 
fact that they were building holder capacity for Kenosha in Ra- 
cine. 

"The United States report on public utilities gives the holder 
capacity of all gas plants reporting. The ratio of holder capa- 
city to annual output was computed for the group which reported 
100 to 500 million cu. ft. annual output. Twenty plants fall 
into this gfroup having outputs of 102 to 433 million cu. ft. an- 
nually. The ratio has a maximum of 9. a minimum of 1.94, an 
average of 5.044, and a median of 5.23 ; there is no mode. The 
ratio for Racine, based on the total output for 1909, is 6.50. On 
the basis of a maximum daily output of 1 :250 of the annual out- 
put, the ratio corresponding to a holder capacity equal to the 
maximum day's output would be 4. 

"The holder investment statistics for Wisconsin gas utilities 
show some other plants which have as large holder capacity 
as Racine, but in general this is the result of local conditions. 
Holders, like condensing systems, commence to depreciate from 



Digitized by VjOOQIC 



aXY OF RACINE V. RACINE OAS UQHT CO. 249 

the day they are built, ancj interest and depreciation for a few 
years offset the advantage of building large capacity. Some- 
times lack of space would require that a large holder be built 
rather than two of medium size, but this is not the case in Ra- 
cine. There is ample room for future growth during the life 
of any of the present equipment. At the end of that life the 
growth of the city might render necessary a new site for the 
plant. A million cu. It. capacity in Racine would be ample so 
tar as Racine is concerned for years to come, and an apportion- 
ment of the smaller holder to Kenosha entirely may be justified 
not only by arg^uments noted later herein, but also by the fact 
that it seems quite evident that a large increase in holder capacity 
was undertaken by the owners with the view of establishing 
Kenosha's holder capacity in Racine. O'Connor's Gas Engineers' 
Hand Book states that holder capacity should be increased by 
duplicating the capacity. This would have meant the building of 
a second holder of 400,000 cu. ft. capacity before a holder as 
large as 1,000,000 cu. ft. capacity would have been undertaken. 
The average shown in the statistics collected for American plants 
shows somewhat higher holder capacity than that equal to a 
maximum day's output would allow. In some sections, however, 
plant investment is known to be extravagant and holder capaci- 
ties much in excess of needs are not infrequent. 

*'As regards the buildings, it may be said that they do not have 
excessive capacity if we exclude the retort house. The condens- 
ing room could hardly have been constructed without allowing for 
the installation of a second set. Comments on the retort house 
have been made previously. The coal storage capacity would 
seem to be justified by the low cost of handling coal. In making 
a review ot the construction of the Racine Gas Light Company's 
buildings, the matter of investment for other than utility purposes 
might be included in the following items : Extra cost was nec- 
essary in order to lay brick up in Flemish bond. The pilaster 
work with stone finish, especially on the retort house, as well 
as the high grade Ludovici tile roofing an,d brick gate and con- 
necting wall are also items on which investment was made 
largely for purposes of ornamentation. 

"In considering the investment in mains, we can also make 
use of the principle of installation by units. The unit here is 
clearly the block, and mains should be installed having a capacity 
sufficient to supply this block for a reasonable time, which, in 
general, should probably correspond to the life of the main. 
This would not, of course, apply to feeder mains, but only to the 
branch mains which supply consumers block by block. Changes 
in the direction of the growth of a city may necessitate the re- 
moval of small feeder mains and their replacement by larger 
mains. There are many cases where there would be no justifica- 
tions for laying mains large enough to take care of the entire 
possible growth in that direction during the life of the main. 



Digitized by VjOOQIC 



250 BAILBOAD COMMISSION OF WISCONSIN. 

Tlic use of higher pressures and of booster mains with district 
governors has changed the whole situation in regard to the distri- 
bution of gas. Inadequate pressures in a given district can be 
easily rectitied at reasonable cost by the installation of a feeder 
main into the center of the district affected. The paving of 
streets ^and other municipal improvements may necessitate the 
laying of mains in advance of the needs of the business, but usu- 
ally this applies only to comparatively few streets and would not, 
in general, add greatly to the unit cost of the whole system. It 
is the opinion of many engineers that no main less than four 
inches in diameter should be laid. An examination of the Ra- 
cine distribution system shows that the practice there has been 
practically in conformity with this opinion. During recent years 
nothing under four inch has been laid, and a relatively small 
amount of main is now in service under four inches. 

**In determining what is the smallest size of main it is good 
practice to lay, the first consideration is adequacy. It is evident 
that no main should be laid which will not give sufficient pres- 
sure whenever ithat pressure is demanded. It is necessary, then, 
in attacking the problem of the size of mains to determine, if 
possible, the average maximum demand of the individual con- 
sumer. The appliances now installed require much more gas 
than did those installed a few years ago; instantaneous water 
heaters, for example, demand from 100 to 300 cu. ft. per hour. 
Gas range burners use from 15 to 20' cu. ft. per hour. Most 
of the gas ranges in use have four top and two oven burners. 
If the oven and all the burners were in use at once, the consump- 
tion would be above 75 cu. ft. per hour. It is, however, uncom- 
mon for all these burners to be used at one time. A number of 
houses were canvassed in Racine, and the consumption during 
the time of preparation of the noon meal was determined by ob- 
servation of the test hand of the meter with a stop watch. The 
largest consumption found was at the rate of 40 cu. ft. per hour. 
Where stoves were being used, generally two burners were in 
use, consuming about 30 cu. ft. per hour. It was noticed that 
at the time when the inspector called that a good many stoves 
were not in use. In some cases coal ranges were being used. 
This survey was made in February. The inspectors also looked 
ovier a number of records taken by complaint meters. These 
• also showed it to be unusual for the individual demand to go 
higher than 30 cu. ft. 

"While additional facts would be interesting in connection 
with the variation of individual demand, a large mass of data 
would have to be collected before an exact conclusion in regard 
to the composite maximum demand could be reached. In the ab- 
sence* of this record information, the instantaneous demand on 
the station is the best indication of the requirements of the aver- 
age consumer. These demands were taken in Racine on Feb. 
22 and 23, and the load curve was plotted. This load curve is 



Digitized by VjOOQIC 



CITY OP RACINE V. RACINE GAS UGHT CO. 251 

shown in the following collection of load curves reproduced 
herein. Tuesday is usually the day of the greatest load in Ra- 
cine, and for this reason Tuesday was selected as one of the 
days of the test. This curve shows the maximum demand to 
have occurred at noon, and it is believed to be generally true that 
the greatest demand in most residence districts is at noon, and 
is, tnerefore, a fuel demand. Mains adequate to meet the fuel 
demandi at noon will usually be adequate lor the lighting load and 
the combined fuel and lighting load at 6 :00 p. m., since it is cer- 
tain that the fuel demand is much greater at noon than in the 
evening. The greatest fuel demand of the year in Racine is 
during the summer. This is shown by the curves which show 
the monthly sales for different purposes for 1905 and 1909. 
These curves are included in the collection of curves shown 
on the following pages. The second load curve was taken in 
Racine during the month of July. It was rather surprising to 
find that the maximum demand' was approximately the same as 
in February. The increased fuel sales during the summer 
months appear to be due rather to the use during more hours of 
the day than to increased use at the tinie of the peak load. 

"Since Racine operates with the two meter system, it is possible 
for us to determine the number of fuel constuners. We can, 
therefore, take the peak demand and by dividing by the number 
of fuel users get the average maximum of the fuel customer. 
This, for July, was found to be about 15 cu. ft. As a check on 
the Racine results similar demand curves, shown later, were 
taken during the summer at Fond du Lac, Oshkosh, and Apple- 
ton. These are among the larger plants of the state, and all use 
the two meter system. The average maximum demand on the 
day the readings were taken were none of them higher than the 
Racine demand, the figures being, Fond du Lac 11.05 cu. ft., 
Oshkosh 14.35 cu. ft., and Appleton 12.57 cu. ft. In connection 
with their case before the Commission, the Madison Gas and 
Electric Company submitted a demand curve for their maximum 
day. They use only one meter in Madison, but the consumption 
is very largely for fuel purposes, and if we assume that 90 per 
cent of the consumers at the time of the maximum demand were 
fuel users, we get an average maximum demand per consumer of 
12.6 cu. ft in Madison. 

"It appeared desirable to secure another demand curve in Ra- 
cine during the autumn. The maximum day of the year in 
Racine appears to come in November or December. A test was 
made on the day preceding Thanksgiving, and the load curve 
for that day is also reproduced herein. The noon peak in this 
load curve appears to be somewhat lower than the evening peak. 
The average demand per fuel consumer at the time of the noon 
peak is computed as about 15 cu. ft. A further check upon the 
matter of average demand was obtained by a house to house can- 
vass in one of the residence districts in Madison, where the 



Digitized by VjOOQIC 



252 



RAILROAD COMMISSION OP WISCONSIN. 



largest consumption of gas at noon per consumer might be ex- 
pected. The results of this test, when tabulated, bear out con- 
clusively the relations obtained in the tests described above, an 
average demand of 15.6 cu. ft. per hour being found. 

"The following curves give the results of the several tests 
made in Racine and also the results obtained in the other cities 
mentioned. There are also reproduced curves showing the varia- 
tion of monthly sales in Racine over the years 1905 and 1909. 



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CITY OP RAOINB V. BAdNB GAS LIGHT CO. 



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CITY OP RACINE V. BAC3NB GAS UQHT CO. 



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"In the light of the accumulated data it seems improbable 
that the average max'mum demand per consumer will greatly ex- 
ceed the rate of 15 cu. ft. per hour. However, it is not at all 
impossible that the demand does exceed this rate. Examination 
of the load curves show that the noon and evening peaks are the 
only periods which need to be considered in this connection in 
determining the capacity of the mains. While the demand of 
other appliances is much greater than the demand of the gas 
range, the diversity factor is so great tiiat these amounts do not 
affect the results appreciably. 

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amount of gas which is lost by leakage must be considered in 
calculating the capacity of the main. It is also probable that 
the average maximurn demand in districts where the average con- 



Digitized by VjOOQIC 



266 RAILROAD COMMISSION OP WISCONSIN. 

sumption IS high, is greater than the average demand for the 
entire system. The comparison of the February and July loads 
for Racine, however, indicates that the large consumers prob- 
ably use their greater consumption more off peak than on peak. 
Allowing for leakage and the variation' of demand of different 
districts, inaccuracy of the method employed, etc., it appears 
fairly certain that an average demand of 20 cu. ft. will meet any 
present need in the residence districts of Racine. If this as- 
sumption be "true, a two inch main will supply all the g"as needed 
in any block in the residence part of the city. In studying the 
distribution of sales over the various parts of the city, the fuel 
sales of each consumer for the month of September, 1909, were 
taken from the copy of the consumers' ledger made bv members 
of this staff, and are shown on the map accompanying this report* 
as consumption per block. In two large residence districts, one 
on the south side, a high class residence district, and one on the 
north side, a middle class district, the number of consumers per 
block were pIso counted and have been shown on the map. The 
month of September was taken because during this month the 
fuel consumption was greatest. The average consumption per 
block was d'etermined, and the average number of consumers 
r>er block. These results are shown graphically in the curves 
which accompany the map. A very noticeable feature of the 
chart is the Targe number of blocks having one or two con- 
sumers. This occurs on the cross streets. Reference to the 
map will show that in almost all cases these consumers are sup- 
plied bv four inch mains, and further that the main does not 
come through to the street, but runs only to the middle of the 
block. A two inch main would supply all of these consumers 
and in most cases a l^/i inch main from the street would meet 
any demand. It is almost in the nature of a long service. In 
most of these districts very little building has gone on during the 
last ten years, particularly on the south side where the character 
of the district seems established. The map which shows the ex- 
tensions of mains during the last ten years, shows that most of 
these mains were put in over ten years ago, and in but few cases 
have they been extended. Where carrying capacity for blocks 
beyond is not required, a two inch main will satisfy all the de- 
mands during the life of the main for any distance not over 200 
yards. When we consider that the cost of four inch mains !n 
Racine is, according to the engineers' valuation, 54 cts., and two 
inch mains 22 cts., it can readily be seen that a large saving per 
mile of main is possible by installing the smaller size. An in- 
teresting thing shown by the arrangement of consumers by streets 
and blocks is, that the north side district shows that little gas is 
used for cooking in the winter months, but that while gas is be- 
ing used these consumers require nearly as much gas per con- 
sumer as the consumers in the high class districts. 

^ Map not reproduced here. 

Digitized by VjOOQIC 



CITY OP RACINE V. RACINE GAS LIGHT CO. 257 

"Another method of measuring the reasonableness of the dis- 
tribution investment is to compare it with the investments in 
other Wisconsin cities which are known from service inspections 
to be giving adequate service. The following table shows the 
miles of main, number of consumers, main investment per mile 
and per consumer, distribution investment per mile and per con- 
sumer, and gas sales per mile and per consumer for a number of 
cities comparable in service to Racine. Madison is the only city 
which approaches Racine in the number of miles per consumer 
or saturation of territory. The sales per mile of main in Madi- 
son slightly exceed Racine. The main investments per mile are : 
Madison, $2,528 ; Racine, $3,583 ; per consumer, Madison, $25.25 ; 
Racine, $34.89. Only one city included in the list has a main in- 
vestment per mile greater than Racine. Two cities have a larger 
investment per consumer. The high costs in these two cities are 
directly traceable to peculiar local conditions, which conditions 
do not prevail in Racine. 
17— R. D. 



Digitized by VjOOQIC 



258 



BMLEOAD COMMISSION OP WISCONSIN. 






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CITY OP RACINE V. RACINE GAS LIGHT CO. 259 

"As showing the difference of opinion in regard to the laying 
of mains under four inch, a compilation has been made from 
the annual reports to the Commission of the percentage of mains 
of various sizes in thirty-two Wisconsin cities. This tabulation 
follows : 



Digitized by VjOOQIC 



260 



RAILROAD COMMISSION OP WISCONSIN. 



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CITY OP RACINE 1^. R.VCINE GAS LIGHT CO. 261 

"It will be noted that the majority of the companies lay 
mains imd-er four inch. Madison has 58 per cent of two inch 
mains, Eau Claire 24 per cent, Beloit 42 i>er cent, Appleton 26 
per cent, Racine has 19.7 i^er cent of mains under four inch. 
No two inch mains are reported for Racine. 

"In order to give a clear idea of the effect of the use of mains 
of different sizes upon the investment per mile of mains, the 
Racine prices have been applied to the percentages given in 
the table, and give for each town the cost of a composite mile 
of main. Only one city shows a cosC per mile appreciably 
greater than that shown for Racine. The table shows merely 
the effect of installing in Racine installations identical in capacity 
to those used in other cities. The various averages for the com- 
posite cost per mile are shown in the table. 

"Reference to the map of Racine, previously mentioned, 
shows that the company made a practice of laying two mains on 
streets where the street cars run. This has not been done in 
other Wisconsin cities outside of Milwaukee. It is justified on 
the basis of decreased maintenance costs. As throwing some 
U^t upon this matter, the main and service maintenance costs 
for several Wisconsin cities having street railways have been 
compiled in the fol 'owing table. The table shows the mainte- 
nance costs for Racine to be above the average. 



Digitized by VjOOQIC 



262 



BAILBOAO COMMISSION OF WlSCOiTStM'. 



Ed 








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Digitized by VjOOQIC 



ClTY Op HACiNE V. BAClNB GAS LIGHT CO. 



263 



"Using the investment as shown in the engineer's valuation, 
with sHght aherations, the principal one being the inclusion of 
all of the value of the large holder which is now in use, as a 
basis, deductions luave been made to show the investment in the 
Racine plant each year, back to 1900. The deductions are the 
amounts expended for extensions each year, as shown by the 
company's books. In this table the high pressure system has 
been excluded and the unit costs per consumer and per thousand 
sales are based upon the assumption that the property, with the 
exception of the high pressure system, is used for Racine. T^or 
this reason the results since the year 1907 are not representative 
of the actual conditions so far as manufacture and storage are 
concernec}, but show rather what would be the case were the 
company to stop selling gas to Kenosha. The distribution units 
are comparable for the endre period covered. 

INVESTMENT DATA FOR RACINE-^1901-1909. 





•Total. 




Per consumer. 


Per M sales. 


Year 


Manu* 
factur*. 


Storacre. 


Distri- 
bution. 


Manu- 8tor- 
facture. 1 acre. 


Distri- 
bution. 


Manu- 
fac- 
ture. 


Btor- 
aca. 


Distri- 
bution. 


1001 


8179,830 
196. 44d 
200.010 
800,294 
213.243 

217.870 
259.848 
875.715 
283.419 


r8,523 

78,' 523 
78,253 
78.253 

78,590 
158L890 
153,890 
158.890 


1254,137 
268,870 
290.796 
304.741 
313.177 

336,833 
353,761 
368,064 
397,078 


, 










1902 
1903 
1904 
1905 

1906 
1907 
1906 
1900 


846.40 
43.35 
43.30 
41.60 

30.10 
43.45 
44.05 
42.50 


818.53 
17.05 
16.27 
15.35 

14.12 
25.80 
24.67 
23.08 


163,40 
63.10 
63.10 
61.10 

60.50 
50.20 
57.32 
50.50 


11.87 
1.74 
1.82 
1.70 

1.60 
1.75 
1.70 
1.68 


80.818 
.685 
.685 
.628 

.570 

1.039 

.988 

.914 


$2.80 
2.53 
2.68 
2.51 

2.48 
2.38 
2.36 
2.35 



•Tha usual 12 per cent Included. 

"On the whole, the investigations conducted and the data 
compiled show that the Racine investment is greater than is nec- 
essary to supply present demands and is greater than that of any 
other plant operating in Wisconsin under similar conditions. It 
is, however, necessary to examine the probable growth of the 
business before passing finally upon the justification of the pres- 
ent investment. 

"It may prove both interesting and valuable to point out here 
some of the relationships existing between daily, monthly and 
yearly oirtput of gas plants. The ratio of 1 :250, as the maxi- 
mum day's output to the total yearly output, has been used in 
this report. For the year 1909 this ratio for Racine was found 
to be 1 : 253. An examination of the Massachusetts report for 
1908 shows that for forty-seven Massachusetts plants the aver- 
age ratio was 1 :238, the minimum 1 :413, the maximum 1 :46, and 
the median 1 :245. The extremes were both for plants that were 
operated in connection with other plants. The plant reporting 



Digitized by VjOOQIC 



264 



RAILROAD COMAIlSSiON Ot^ WisCONStN. 



the extremely high daily output was one of the plants of the 
Boston Coni[)any and was probably used, in general, as a reserve. 
The i)lant reporting the smallest maximum day purchased a con- 
siderable portion of its gas from another company. Where the 
actual figures are not available, it has been found that 3 :250 is a 
safe ratio to use. The following table shows the daily varia- 
tions in send-out in Racine for the year 1909. The day consid- 
ered in this table is from 6:00 a. m., to 6:00 p. m, the night 
from 6 :00 p. m., to 6 :00 a. m. 



SEMD-OUT FOR RAClXE-1909. 





January. 
1 


February 

1 


March. { 


April. 

1 


May. 


.June. 


Dat«. 


i 






i 




^ ! 




55 




1 


1 


1 


221 
235 
211 
298 
350 

307 
26S 
264 
322 
274 

282 
265 
276 
.308 
278 

312 
230 
271 
297 
309 

350 
310 
387 
310 
290 

293 
292 

:^ii 

310 
292 

213 

8,945 


1% 
227 
103 
260 
267 

226 
214 
223 
242 
209 

240 
233 
220 
231 
230 

252 
195 
216 
227 
248 

263 
285 
284 
224 
231 

212 
224 
176 
272 
233 

197 

7,149 


226 
256 

278 
220 
342 

294 
185 
207 
279 
245 

220 
227 
299 
214 
245 

267 
251 
359 
274 

296 

183 
241 
270 
291 
215 

197 
294 
176 


221 
212 
205 

m 

218 

2K 

208 
218 
226 
238 

218 
253 
242 
175 
206 

216 
196 
94 
221 
236 

215 

205 
204 
237 
196 

243 
245 

168 


221 
254 
271 
238 
232 

284 
216 
246 
266 
275 

28 
254 
303 
214 
244 

260 
231 
256 
245 
278 

206 
240 
230 
288 
240 

233 
2r3 
197 
238 
246 

244 


245 

210 1 
211 
211 
199 

224 
166 
199 
183 
211 

191 ; 

202 
219 
168 
205 

211 
196 
194 
214 
222 

162 
203 
190 
202 
224 

224 
230 
175 
217 
203 

216 


220 
216 
272 
193 
205 

290 
267 
269 
233 
267 

187 
285 
242 
271 
253 

248 
278 
249 
230 
259 

268 
244 
228 
260 
228 

219 
286 
271 
2?3 
259 


201 
215 
241 
145 
250 

201 
223 
209 
230 
225 

130 
208 
212 
181 
201 

220 
214 
163 
210 
194 

194 
219 
212 
195 
174 

208 
217 
174 
193 
196 


305 , 205 
184 165 
223 ' 190 
263 183 

187 1 208 

278 ' 237 
251 204 
297 215 
251 143 
257 ^ 182 

613 206 
266 166 
277 195 
289 ! 185 
334 220 


307 
350 
318 
292 
364 

263 
332 
291 
303 
287 

309 
357 
243 
299 
3,5 

359 
319 
293 
328 
211 

320 
342 
315 
303 
273 

441 
225 

350 
347 
314 


256 


2 


109 


3 

4 


174 
181 


5 


180 


6 


101 


7 


iM 


R 


156 


9 


156 


10 


182 


11 


201 


12 


201 


13 

14 


186 
169 


15 


185 


16 


219 
302 
295 
292 
272 

265 


237 
191 
1$^ 
198 
192 

221 


148 


17 


188 


18 


195 


19 


195 


20 


160 


21 


171 


22 


287 I 230 
219 1 139 
291 190 
316 < 206 

259 ' 159 
279 192 
287 199 
328 214 
238 1 151 

231 ' lU 


145 


23 


172 


24 


184 


25 


. 206 
92 


26 


L'7 


121 


28 


173 


29 


177 


30 






190 


31 










7J53~ 












Total.. 


5,957 


7.6?2 


6,327 


7,470 


6.056 


8.355 0.962 


9,470 


5,176 




16,094 


13.110 


13,999 


13,525 


14..317 


14,646 



Digitized by VjOOQIC 



CITY OP RACINE 1'. RACINE GAS MC.IIT CO. 



2( 



)i) 



SEND-OUT FOR KACINE -1900. Com-liided. 





July. 


Date. 




2 




I? 


.S 






5^^ 


1 


314 


174 


2 


310 


255 


3 


414 


216 


4 


320 


139 


& 


214 


146 


tf 


230 


134 


1 


307 


173 


8 


360 


192 


9 


329 


162 


10 


305 


164 


11.. .. 


253 


111 


12 


318 


193 


13 


374 


174 


14 


353 


165 


15 


306 


167 


16 


323 


170 


i: 


368 


189 


18 


287 


106 


19 


312 


185 


20 


338 


172 


21 


330 


147 


22 


347 


170 


23 


309 


194 


24 


345 


192 


23 


231 


119 


» 


323 


167 


27 


364 


183 


28 


358 


145 


29 


298 


159 


30 


316 


174 


31 


872 


188 


Total.. 


10.008 


5.225 



15,233 



Auar. II 




*J 




x; 


!? 


bt 


a 


r. 


267 


130 


302 


176 


381 


154 


300 


176 


297 


168 


277 


192 


344 


180 


194 


131 


315 


167 


376 


181 


405 


163 


320 


164 


309 


172 


415 


124 


255 


122 


328 


199 


387 


150 


319 


177 


310 


191 


320 


196 


348 


109 


211 


151 


291 


297 


255 


187 


349 


176 


304 


167 


340 


175 


370 


221 


242 


152 


311^ 


196 


307 


212 


9,839 

15 

1 


5.436 


..5 1 



Sept. 


4J 




•^ 


>» 


b« 






T. 


333 198 


311 1 193 


321 ' 199 


377 248 


241 


163 


221 


180 


342 


203 


378 201 


334 220 


330 1 231 


403 1 224 


291 146 


339 , 205 


421 ' 237 


381 1 219 


340 215 


343 


228 


393 


231 


2J>5 


166 


351 


234 


416 


213 


412 


218 


362 


217 


353 


223 


365 


233 


259 


184 


208 


232 


337 


211 


363 


227 


318 


231 






10,2I« 'ii.330 


- ♦ — - — 


16,: 


4« 



Oct. 






316 , 241 

405 199 

28.5 184 

33H 237 

391 , 197 



3-M 
335 

.SOT 

284 



224 I 
236 I 
238 
181 ' 



228 



328 

341 

318 

306 218 

347 

362 223 , 

189 I 

315 ; 240 . 

314 216 I 
330 211 



I 325 

I 323 

375 

242 

296 



317 

288 
282 
317 



275 



9.907 



248 
234 
258 
187 
255 

298 
257 
231 
231 

278 

181 

7,082 



17.989 



No 


V. 






A 


5 


^ 


G 


24ti 


337 


351 


234 


342 


244 


342 


219 


334 


231 


.^^96 


228 


291 


201 


354 


237 


352 


213 


331 


216 


341 


260 


326 


226 


372 


255 


289 


229 


328 


218 


370 


2iK> 


324 


271 


324 


236 


S20 


242 


375 


2.S7 


303 


192 


350 


362 


384 


247 


401 


286 


326 


204 


316 


247 


368 


258 


323 


204 


3:« 


2i')8 


363 


248 






10,280 


7 213 


17,^ 


193 



Dec. 



3.S '^. 



361 

:«2 

363 
417 
3:)6 

328 
3:3 
357 
343 
354 

437 
223 
426 
432 
370 



242 
250 
246 

223 



258 
254 
2f.5 
316 

338 
339 
309 
292 
260 



328 267 

359 266 

356 273 

254 213 

322 f 264 

358 ' 261 

356 269 

348 2t» 

380 I 28:1 

312 ; 21s 

214 li« 

3.34 216 

353 267 

339 248 

320 235 

291 .305 

10,706 8.120 

1S,.H26 



"The following table gives the maximiini and minimum Iwenty- 
fonr hour send-outs for Racine for each month shown in the pre- 
ceding tabulation: 





Month. 


Maximum. 

•«71.000 

r*<o,oiH) 

522.000 
5I.'t.ii00 

:>54.01)0 
W3,0W» 

(CIO, 000 

609.000 

658.000 
635,000 
687,000 
775.000 


Minimum. 


January 


404.000 


February — . . 


:m,ooo 


March 


370.000 


April 


317. IHH) 


May 


349.0(K1 


jQoe 


340.000 


July 


3.T(», OU) 


Auffust 


325,00l» 


September 


401,000 


October 


4.')6.000 


November 


492, (HX) 


December 


409,000 









Digitized by VjOOQIC 



266 



RAILROAD COMMISSION OP WISCONSIN. 



"In connection with the above tables a number of interesting 
relationships have been worked out. It is of value here to point 
out some of the relationships existing between daily, monthly 
and yearly outputs. The following table gives several of the 
ratios established in Racine : 



Month. 



January . . 
February. 

March 

April 

May 

June 

July 

AU£ru8t 

i^eptember 
October... 
November 
December. 



Ratio of total 
send-out to max- 
imum 24 hour 
send -out. 



22.5 
32.3 
36.8 
315.3 



35.8 
35.9 
34.3 
35.1 

35.2 
283 
35.4 
34.3 



Ratio of total 

ulffht liend-out to 

to total day 

fiend-out. 



0.7W 
0.833 

0.81U 

0.713 
0.547 
0.583 
0.553 

0.620 
0.716 
0.703 
0.756 



Ratio of illumin- 
ating sales to all 
other aalaa. 



0.807 
0.728 
0.591 
0.475 

0.374 
0.267 
Q.304 
0.191 

0.361 
0.395 
0.57S 
0.680 



*The ratio of monthly total to maximum day (twenty- four 
hours) varies frcin 22.2 to 28. '^ The average is found to be 
1:25.16, or, in other words, the total send-out per month is 25.16 
>times as great as the maximum daily (twenty- four hour) 
send-out during the month. The average ratio of yearly and 
maximum monthly send-out has been found to be 1:10.31 with 
a maximum of 1:10.7 and a minimum of 1:10.3. 

"When this investigation wa.** undertaken, it w^as considered 
advisable to make a .study of the matter of the probable popula- 
tion of Kenosha and Racine, since it was thought that this report 
would be submitted before the official census returns would be 
made. An examination was made of the election figures and the 
school census, but these were found to l>e of no material assist- 
ance. The inspector in charge of the work afterwards calle^l 
upon a number of local real estate men and contractors, and 
from their estimates arrived at a population of 37,500 in 1910, 
which figure was considerably higher tlian the estimate made by 
the gas company. The state census of 1905 showed a slig-htly 
lower rate of increase between 1900 and 1905 than between 1890 
and 1900, and the use of either of these rates would give a figure 
as high as 37,500. The rate of increase from 1890 to 1900 would 
give a population of 37,100 in 1910. Kenosha orrew very 
rapidly during the years 1900 to 1905, and the population in 1910 
is based upon the rate of increase during that period. Using the 
1910 returns for Racine, and the estimate just indicated for 
Kenosha, the populations for the two cities have been extended 
to 1930. The following table gives the population for Racine 
fropi 1850 and the population of Kenoslia from 1900 to 1905: 



Digitized by VjOOQIC 



CITY OP RACINE V, RAdNB GAS UGHT CO. 



267 



POPULATION OF RACINE AND KENOSHA. 



Year. 


Racine. 


Kenosha. 


1850 


5,107 
7.822 
9,880 
16.081 
21.104 

88.103 
32,980 
38,002 
*46.908 
•51,362 

•55,802 




1860. '. 




1870. 




1880. 




1890 




1800. 


!;:SS 


1905 (stftie census) 


1910(1). 8. census) '.....' 


•20,864 
•30, lis 


1920. 


1925. : 


*34 741 


1090L . 


•89.870 









•Eatlmated. 



"The following table gives the send-out and sales for Racine 
from 1900 to 1909, inclusive. The amounts given are for calen- 
dar years. 



Ye*r. 


S^nd-out in 
M cu. ft. 


Per cent 
increase. 


Sales in 
M cu. ft. 


Per cent 
increase. 


1800. 


84,875 
77.149 
106,641 
125,250 
126,284 

106,645 
197,358 
218, 8Br 


.... ^.. 


64,375 




1901 


42 

38 
17 
1 

1 

14 
15 
18 

9 




1802 


96.103 
114,608 
114.662 

125.088 
135,713 
148.210 
155.806 
168.446 


77 


1903 


19 


1804 '] 





1905 


9 


1908 


s 


1907 


9 


1908 


5 


1909 









"A marked increase in sales is noted for the first few years 
during which the present company has oj^erated the plant. The 
total increase in send-out in the ten year period covered has been 
from 54,375,000 cu. ft. to 215,864,000 cu. ft., or 161,489,000 cu. 
ft. ^ ^ 

"The following table is a reproduction of the gas account as re- 
ported by the company in its last two annual reports to this Com- 
mis.sion : 



Digitized by VjOOQIC 



268 



RAILROAD COMMISSION OP T^aSCONSIN. 



GAS ACCOUNT. 
Raoinb Ga8 Light Co. 





Cubic Feet. 


Items. 


Year ending 
June 30, 19Mn 


Year endioir 
June 30. 1910, 


Gas on hand first of year 


299,(00 
205.996.000 

306.297,000 
1.2i7,00i) 


1,257,000 


Gas made durincr year 


231,669.000 






Total gfui to arcount for 


232.916.000 


Gas on hand close of year 


934.000 






(ias delivered to mains 


206,040.000 

187,129,800 
4,110,700 


231,982.000 


Gas sold 


210,933.900 


Gas used by company 


4.1»6,700 






Total ffas used and sold 


191,240.500 
13,799.500 


21.'). 127.600 






Gas unaccounted for 


16,854.400 







'The foregoing table shows, in a general way, the extent of 
the business done by the respondent. It will be noted that diir- 
\n^ the last fiscal vear the amount of gas delivered to the mains 
was 232,916,000 cu. ft., of which 210,933,900 cu. ft. was sold 
in Racine and to Kenosha. Sales increased 23,804,100 cu. ft. 
over the 1909 total. This increase was practically all in Racine, 
as the amount sold to Kenosha remained practically the same for 
the two periods. 

"As still further showing the growth of respondent's business 
in Racine, the following table is given, showing the sales per 
capita each year from 1900 to 1909, inclusive: 

RACINE—^ALES PER CAPITA. 



Year. 


Population. 


Sales in M 
cu. ft. 

54.374.8 
77.149.5 
96.101.9 
114,699.2 
114.662.0 

125,088.0 
135,715.0 
148.216.0 
155.806.0 
168,446.0 

, 190,761.0 


Sales per cap- 
ita in cu. ft. 


1900 


29.102 
29.992 
30,882 
31.772 . 
32,662 

?3,552 
34.442 
35,. "02 
36.222 
37,112 

38,002 


1 870 


1901 


2 580 


1902 ;*; 


3 110 


1903 ;;.;:: 


8.610 


1904 


3,510 
3 730 


1905 


1906 ;•. 


3 940 


1907 ;..;; 


4.195 


1906 


4 XO 


1909 ;. 


4. .W* 


1910 


5,019 







**Thc yearly population, as shown in the above table, has Ixjen 
computed on the basis of 1900. 1905 and 1910 census reports. 
The sales for the calendar year 1910 were estimated, by assuming 
that the increase over the 1909 figures would be the same as the 



Digitized by VjOOQIC 



CITY OF RACINE V, RACINE GAS LIGHT CO. 



269 



increase noted in the June 80, 19(X), and die June 30, 1910, re- 
port.s. The table shows that the sales per capita have increased 
rapidly, the sales per capita being about 3,140 cu. ft. greater in 
1910 than at the time the present company took control of the 
plant. At the present rate of increase the sales per capita will 
reach almost 6,000 feet in 1920. It is doubtful, however, that 
the present rate of increase will continue until 1920. It appears, 
from information available, that in cities of under 100,000 popu- 
lation, sales per capita seldom exceed 5,000 cu. ft. The sales 
statistics taken from Brown's Gas Directory for 1908, covering 
data from about 185 plants throughout the country, show the 
lo'lowing rchtions : 

Sales per capita, 
cu. ft 

Minimum 120 

Maximum : 6,400 

Average 2,545 

Median 2,550 

Mode 2,600 

"The exhibit shows very few companies which are producing 
more than 5,000 feet per capita. 

"The sales per consumer do not show the marked increase 
during the ten year period that is true of sales per capita. The 
following statement shows the sales i>er consumer for the vari- 
ous years: 





UACINE-HALES l»EU CONSITMEU. 






Ve„. 


Ck>nsiiiners. 


Sales iier con- 
sumer cu. ft. 


1903 




4.fl04 
4.8.35 
5.122 
5.558 
5,970 
6.233 
6.607 


24 913 


!«>♦ 




23 710 


1P05 




24.421 
24 418 


1906 


1907 




24.826 


1908 




24 997 


190S) 




25,264 







**In the following table the prcccdiig data have been combined 
into one table, together with other data, and the whole compared 
with the Madison figures : 



Digitized by VjOOQIC 



270 



RAILBOAD COMMISSION OP WISCONSIN. 



GAS SALES STATISTICS. 





No. COFiUmRS WCH 


Gas sold pki 


M on. FT. 


GAS SOLD 


Year 


MILK or MAIN. 


1 OONSUMVR. 

1 


FIR MILE OF MAJIV. 




R&cine. 


Madiion. 


lUcine. 


Madison. 


Racine. 


1 UadbiOii. 


1890 




50.82 
07.48 


1 


27.450 
24.370 




1,906 


1900 




1 88,300 




1.044 


1901 




70.07 
73.04 


, , 


26,790 




1 1.8<7 


tOOB 




. 22,735 
1 24.913 


23.300 
22,830 




1.702 


1903 


90.1 


79.10 


2,240 


1.802 


1904 


91.2 


84.82 


23,710 


23.0TO 


2.160 


1 1,957 


1906 


95.0 


87.63 


' 24,421 


24,210 


2,330 


2.122 


1906 


96.0 


94.04 


24,418 


24,440 


2,300 


2,298 


1907 


101.6 


97.74 


24,826 


25,460 


2.520 


2,480 


1908 


102.0 


96.42 


24.997 


26.711 


2.550 


2.620 


1909 


103.0 


90.62 


25,264 


27,210 


2.600 


2,711 



**The ratio *Xo. of consuniers per mile of main' used in the 
table, is the unit of comparison used to measure the increased 
sales due to new consumers; the ratio *Gas sold per consumer' 
measures the increased sales due to existing consumers, while 
*Gas sold per mile of main' measures increased sales due lo 
both causes. It will be noted that while the number of con- 
sumers per mile of main is today greater in Racine than in Madi • 
son, that the increase has been greater in the last few years in 
Madison. Gas sold per consumer has shown but a slight in- 
crease. 

"The following table gives the same general data as contained 
in the foregoing tabulation for a few of the larger* gas plants in 
Wisconsin : 

GAS SALES STATISTICS.-WISCONSIN UTILITIES. 
Year cmlitia June 30, I0fl9. 



City. 


No. consumers 

per mile of 

main. 

66.9 
•0.4 
66.3 
83.9 
99.6 

70.5 
62.3 
102.6 


M cu. ft. sold 

per 

consumer. 


M cu. ft. sold 

per mile of 

main. 


Superior 


31.14 
18.94 
26.2S 
29.0r 
27.21 

20.09 
18.33 
25.03 


2,052 4 


JanesTiUe 


1,712.3 


Belolt 


J:2I:S 


Kenosha 


Madison 


8 711 


Manitowoc 


1,417.1 


Appleton 


1,141.4 


Racine 


2.570.2 







'The foregoing statistics have been presented in order to give 
a general idea of the extent and character of the business done 
by respondent, the growth of the business, and a comparison with 
other plants in the state. In a general way, it may be said that 



Digitized by VjOOQIC 



CITY OF RACINE V. RACINE GAB LIGHT CO. 271 

the gas business in Racine has been well developed by respondent 
and the territory is fairly well saturated. 

"Respondent supplies gas to three general classes of consum- 
ers in Racine, namely, illuminating, domestic fuel, and indus- 
trial fuel. The classification of consumption as illuminating and 
domestic fuel is made possible in Racine by the use of the double 
meter system, one meter being used for illuminating gas and an- 
other meter for fuel gas, where a consumer uses gas for both 
purposes. Besides the above three classes, the respondent has 
furnished gas for Kenosha in the years 1907, 1908 and 1909, and 
is at present supplying gas to Kenosha. 

**In order to show the relative demand made upon the plant 
by these various classes, a table has been prepared covering the 
last six years. Total sales to each class are shown and the per- 
cent of the total amount of gas' sold to consumers. (This table 
is shown on page 287 herein.) 

"In connection with the above mentioned table it is interesting 
to note what a small degree the percentages for each class 
vary from year io year. The illuminating gas sales during the six 
year period' varied but 4 per cent, while industrial fuel sales 
were the lowest at 7 per cent and the highest at 12 per cent. On 
the whole, the increase, though comparatively slight, has been in 
the domestic fuel class, the other two classes falling off slightly. 
The sales to Kenosha represent about 14 per cent of the total 
sales. 

"Illuminating sales increased during the six year period above 
described from 30,072,000 cu. ft. to 50,990,000 cu. ft. or an in- 
crease of about 30.5 per cent. Domestic fuel sales show an in- 
crease from 64,017,000 cu. ft. to 102,678,000 cu. ft., a ^ain of 
38,661,000 cu. ft., or about 60.5 per cent, or twice that for illumi- 
nating sales. Industrial fuel sales increased 3,205,000 cu. ft., 
or about 28 per cent. The greatest gain, then, has been in the 
sale of domestic fuel gas. 

"In order to make the growth of the business of respondent 
and the relative growth of the sales to the various classes more 
readily grasped, the preceding data have been reduced to dia- 
grams. These diagrams show, in simple form, the rates of in- 
crease of illuminating sales, domestic fuel sales, industrial sales, 
and total sales. Attention is called' to the consistent increase 
of domestic fuel sales. For the year 1903 only the figures for the 
total were available, as shown by the break in the other curves. 



Digitized by VjOOQIC 



272 



RAILRO^VD commission op WISCONSIN. 



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/a99 /900 /90/ /90a /SOS /«V /SOS" /90e /907 /SOS /S09 

Vbans 

"The assumed population of Racine and Kenosha, previously 
described, would give the two cities a combined population of 
almost 100,000 in 1930. It is probable, however, that 90,000 
will cover the population of the two cities at that date, since it 
seems unlikely that both cities will continue to increase at the 
present rate. If we accept 1)0,000 as the combined population 
for 1930 and the output per capita as 5,000 cubic feet, we would 
hrive a total sale in the two cities in 1930 of 450,000,000 cu. ft. 
and an annual out[)Ut of alxml 47r).0<>(),(K)0 cu. ft. This is based, 
of course, on the assumj)t'()n that both Racine and Kenosha are 
to be suj)plie(l entirely fn.m the Racine j)lant. (Xherwise the 
output will Ix* considerably smaller than that given above. An 
annual output of 475.000,000 cu. ft. will give a maximum day of 



Digitized by VjOOQIC 



CITY OF RACINE t'. RACINE GAS UGHT CO. 273 

1,900,000 cu. ft. The present condensing and purifying capacity 
appears sufficient to meet this, and the holders would fumisli 
nearly, if not quite, sufficient holder capacity. Tiiis would give 
about 0.75 of a maximum day's output holder capacity, and this 
is but slightly below the minimum of 0.8, which has been sug- 
gested by various authorities. It is noted in this connection that 
as plants increase in size, the holder capacity per thousand feet 
of output tends 'to decrease. Many plants appear to be operating 
with a smaller holder capacity than that stated above, and ther'j 
would seem to be no great difficulties in oj^erating under these 
conditions. 

"If all the gas for both Racine and Kenosha were generated 
in Racine, as has just been assumed, it would be necessary to 
increase the present retort house capacity by at least 50 per cent. 
The retort house is arranged with a blank wail at one end' for 
such extensions. However, it has already been pointed out that 
this retort house is not economically arranged, and the cost of 
extending this retort house with the architectural features of the 
present house would be so great that it would probably not be 
undertaken. It is probable that by 1930 all of the present 
benches will be removed and another type substituted, together 
with mechanical stokers. By removing the present benches and 
substituting others with greater capacity per foot of floor space, 
it might be possible to house the capacity required under the 
present room. An additional exhauster and station meter would 
have to be installed. The present buildings would, however, 
house the additional apparatus required. More coal storage room 
would be necessary. 

"Should the plants continue manufacturing gas in both Ra- 
cine and Kenosha up to th's time (1930), the capacity of the 
condensers and purifiers would not be reached by 1930, but it is 
likely that more generating capacity would be required, either in 
the shajK! of coal gas or water gas apparatus. The high pressure 
line between Racine and Kenosha would be ample to send all the 
gas needed by Kenosha. The present compressors would prob- 
ably be worn out by 1930 and slightly larger compressing capacity 
would be necessary. The life of a condensing plant is consid- 
ered to be about thirty years. The first condensers were installed 
in 19(K), the others in 1904, so that by the time they are run to 
full capacity, under the most favorable conditions, they would 
be worn out. 

*The distribution system in Racine would re(|uire consider- 
able extension during this period. The length of main per con- 
sumer is not excessive at the present time. The large invest- 
ment in the distribution system is due to the size of main laid. 
Racine has more consumers per mile of mani than any other 
c'ty in the state outside (;f Milwaukee. The only way in which 
the investment per mile of main could be lowered in the future, 
would be by the installation of smaller mains in making exten- 
18— R. D. 



Digitized by VjOOQIC 



274 



BA1LBOA0 COMMISSION OF WISCONSIN. 



sions. The principal direction of growth at present apjjears to 
be the southwestern district. This district has developed very 
rapidly. ExhiWts are available showing the increase in the 
number of houses in this district since 1906. This section is at 
the greatest distance from the gas works, and it may be neces- 
sary to put a booster main into the district within the period of 
time under consideration. While the mileage of main would 
have to be increased, it is certain that in many ix>rtions of the 
city the mains already laid would not be used to their full capa- 
city in 1930. In fact, it appears altogether probable that they 
will never be used at their full capacity. This applies particu- 
larly to the four inch main laid on cross streets, to which refer- 
ence has already been made. 

'*In conclusion it may be said that the greater investment 
in Racine than is required, or is necessary for the service ren- 
dered, and greater than the average of other plants in the state, 
is due, not to an excessive investment in any one portion of the 
plant, but to a very liberal investment throughout. I**or the most 
part it does not appear that this large investment has resulted in 
inore economical operation." 

Additions to Pf^ant. 

The ten«tative valuation bears the date July 1, 1908. The addi- 
tions and extensions to the plant during the years ending June 30, 
1909, and June 30, 1910, are reported by the company as follows: 



Buildlncrs. fixtures and grounds: 
Filling land and break wat«r. . . 

Old works propertF 

Huperintendence 

New holder 

New meter shop 

Total 

Coal ffas apparatus 

Mains 

9ervlc<»s 

Meters 

Connections and miscellaneous... 

IMscount on bonds 

office furniture and fixtures 

Total construction 

Deduct profit on house plpin«r, etc 

Total 



Year Ending 
June 90. 1909. 


Year Endincr 
June 30. 1910. 


1 248.0i 

136.7i 

24.50 

8.718.37 

1.491 32 


1 283.75 

8,07 

""6.'862;72' "" 






110,618.07 
607.24 
10.301.15 
4,440.91 
ii.503.98 
180.77 
7.500.00 


r.094.54 
263.70 

15.439.31 
8.389.90 
2.52S.94 
2,029.46 


a59. 14 


5.46 


$39,512.14 


^.648.31 


138,981.80 


$35,648.31 



The total of reported additions to plant for the Iwo years is, 
then, $74,()30.1J. The C(Jini)any's record of construction and in- 
vestment is available for the years 1902 to 1909, inclusive. This 
record is reproduced below: 



Digitized by VjOOQIC 



CITY OP RACINE V. RACINE OAS LIGHT CO. 



275 



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Digitized by VjOOQIC 



276 



RAILROAD COMMISSION OF WISCONSIN. 



Ucginning with the value of the plant on July 1, 11)08, as given 
it the tentative valuation, namely, $936,(>10 (cost of reproduc- 
'tion), and subtracting the yearly additions as reported by the 
company and shown in the preceding tabulation, we arrive at 
the value of the plant at the beginning of each year as shown 
in the following table. In order to get the' value at the end of 
1!)07, one-half of the reported additions during 1908 were -sub- 
tracted from the engineer's valuation of July 1, 1908. In the 
same manner one-half of the additions during 1908 were added 
to the value on July 1, 1908, to arrive at the value at the end of 
1908. The following table not only shows the value computed 
on the process outlined above, but also gives the average value 
each year, and shows the depreciation and interest on investment 
on this average value computed at annual rates of 2 per cent 
and 6 per cent, respectively. 



STATEMENTOFAVERACiE VALUE EACH YEAR AND DEPRECIATION AND 
INTEREHT ON AVERAGE VALUE. 



1902 



1903 



Value first of .vcar $555,917 l()()4,571 



1904 



1905 



AddUioiis during year. I 48.(i54 36.880; 25,943 
Value close of year..... $604. 571 1641.451 i667,3<H 
Averajre value for year S580,2U f623,01i $654,4: 



HH1,451 «W67,30t 
15,844 



1906 



1907 



DepreclaUon at 2%. 
Interest at 6% 



ILea*) 12,460 
34,815 37,381 



13.088 
39.265 



_l_ 



S683,238 
74.416 



J68:i, 238,1757. 664 

$7207446 

14,4l>9 

43,227 



1675.316 
13,506 
40.519 



S757.654 
162, 28i) 

I91{K943 

*«8,798 

16,776 

50,328 



1908 



$919,943 
32, 134 

«J^2^77 

1936.010 

18.720 



1909 



#952.077 
46.447 

1998,524 

^Two 

19,506 



I 
56,1611 58,518 



GOING VALUE. 

It is the company's contention that the sum of $178,943.25, 
exi)endcd hy it in securing customers and in establishing its busi- 
ness and for which, respondent claims, the company has not yet 
received any return, should be allowed as part of the value of its 
property in addition to the value of the physical property. In 
connection with this matter the company has submitted the fol- 
lowing statement of its expenditures, year by year, for the pur- 
pose of developing the business of the i)lant: 



Digitized by VjOOQIC 



CITY OP RACINE I'. RACINE GAS MOIIT CO. 



277 



Year. 



Prior to 1901 . 

1901 

1902 

1903 

1904 



I90a 

1906 

1907 

1909 (6 monlh.s) . 



ToUl. 



Illuminating 
con.st rue lion. 


Fuel tra.s 
coiKstrueHon. 


•I9.f»7.25 

4,145.44 

16,239.23 

8,126.37 

1.296.98 

1,314.07 
3.525.44 


S65,554.90 

18,278.62 

2,470.07 

3,263.66 

1.416.15 

2,10.78 
2,713.41) 



1,506.37 
338.03 



156,149.18 



1.953.13 
805.52 



198,601.32 



Business. 


Total. 


S832.04 
6,005.11 
1,755.76 
1,673.82 
1,335.24 

1,740.59 
2,566.63 

4,891.84 
3,391.72 


S8tf.044.19 

28,429.17 

20.465.06 

l3,063.a-> 

4,048.37 

5.200.44 
8,805.56 
8.351.34 
4,5,Y).27 


124,192.75 


SI78. 913.25 



Respondent asserts that the entire amount of $178,943.25, 
as above set forth, has been expended for the purpose of estab- 
Hshing its business. Respondent stated that the utility is ccnn- 
paratively new, that ten years ago there was only a small de- 
mand for its product; that in order to secure customers and to 
increase the consumption of gas in the city of Racine and to de- 
crease the cost of production, respondent furnished illuminating 
hxtures at a loss. It also furnished gas ranges to consumers at 
a loss, and various sums were also expended for advertising, 
soliciting, and in other ways securing business. ResiK>ndent 
decjared that consumers in Racine will receive the benefit of these 
expenditures because, when gas can be produced in a large vol- 
ume, the expense of production is decreased. Respondent as- 
serted that the investors, in good faith, spent this money for the 
purpose of establishing the business and they have not, as y?t, 
liad any chance to recoup themschTs for these expenditures. 

The Commission has discu.sscd in previous decisions, and at 
{^reat length, this same question, and there ap|x\'irs no neo:l' of 
going into the matter in detail herein. The following quotation, 
however, is particularly applicable: 

"It thus appears that the cost of building up the business of 
a plant is in most cases as unavoidable as the cost of the con- 
struction of the plant itself; that when such costs are incurrerl, 
they must be reimbursed in some form by the consumers in order 
that capital may be .secured ; that such rembursenicnt is eciuit- 
ahle as l>etween investors and consumers; and that this is a just 
method of dealing with such costs for other reasons. If this is 
sound, it also follows that the cost of the business must also b^ 
taken into consideration in determining the value of the plants 
for rate-fixing purposes. 

"This would seem to apply with special force where by law the 
rates are limited so as not to yield more than reasonable returns 



Digitized by VjOOQIC 



278 RAILROAD COMMISSION OP WISCONSIN. 

upon the investment. While such legislation may not 'be a 
guarantee against losses of any kind, it is clear that if the rates 
fixed under these laws should not include anything for the cost 
of building up the business, there would be no way in which 
these costs could be made good to the investors. In that event 
these costs would become a permanent loss to them; and the 
consumers, in turn, would be relieved from paying a reasonable 
return on a part of the in\tistment or on the capital that is de- 
voted to furnishing them with the service in question. This is 
a situation of which the investors are taking due notice, and 
which is entitled to due consideration. If not taken into account, 
it will tend to keep new capital from entering this field as well as 
to prevent exact justice to capital which has already entered the 
same. The former would result in hardships or inconveniences 
to the consumers; the latter would apparently be unjust to at 
least many of the present investors in such utilities." Hill ct ai 
z\ Antigo Water Co. 3. W. R. C. R. 623, 711, 712. See also State 
Journal Printing Co, v. Madison Gas and Elec, Co. 4 W. R. C. R. 
501, 568-587. 

It will be seen from the above quotation and from a reading of 
the decisions referred to that the Commission has clearly recog- 
nized that the cost of building or developing a business is an ele- 
ment that should be considered in determining the value of a 
public utility, which value is to be used as a basis for rate making. 

While it appears to be tnie that the cost of building up the 
business of a plant is an element which should be taken into con- 
sideration in determining its value for rate-making purposes, it 
is also true that these costs must be legitimate and reasonable. 

"They should not include items that have been incurred under 
other than usual conditions, or items that could have been 
avoided by the exercise of ordinary care and business judg- 
ment. To definitely determine what expenditures are legitimate 
and what part of them are not, is not always an easy matter. 
The difficulties in the w^ay of this are also increased by the fact 
that the early records of the plants are, as a rule, either inaccess- 
ible or incomplete. But even at this the task is not insurmount- 
able ; while there may be a lack of data in some cases, there may 
be an abundance of such facts in others. The conditions which 
obtain for some plants may be a fair indication of the situation 
for others, where the circumstances are similar. In any event, 
what constitutes the normal cost of developing the business is a 
question that, like the cost of the physical value, the fair rate of 
profit and other elements, can be determined by investigation. 

"In addition to those mentioned, there is also another element 
that should receive some consideration in fixing the cost of the 
business, and that is the profits the plants have earned since they 
reached a paying basis. If these profits are so large as to be 



Digitized by VjOOQIC 



CITY OP RACINE V. RACINE GAS IJOHT 00. 279 

coiibicltTably above those ordinarily obtained, it is conceivable 
that strict justice between investors and consumers might require 
that these excesses should be treated as an offset to early losses, 
and that in this way all or a part of the earlier losses may have 
been wiped out. In dealing with this feature of the situation, 
however, it should be borne in mind that the risks involved are 
much greater at first than later on, when the adaptability of the 
plant has been proven -and when its business has been secured ; 
and that since risks are one of the leading elements that deter- 
mine the rate of profit, the rate of returns to which the investors 
and those who carry on the business are entitled may be con- 
siderably higher during the earlier and more risky periods than 
is the case later. Just how much importance should be attached 
to the difference in the earnings as l>etween the earlier years and 
later years, is not clear. Much depends on how the operating ex- 
penses, including depreciation, have been treated, and what sums 
l>nvo been included therein, or excluded therefrom." Hill ct al. 
r. Antigo Water Co. 3 W. R. C. R. 623, 715, 716. 

We have quoted freely from the alx)ve decision of this Com- 
mission in this connection because of the direct application of 
the conclusions arrived at therein to the problem before us in 
this case. The respondent in this proceeding has submitted 
facts and testimony tending to show that the Racine Gas Lighf 
Company has expended a large amount of money, in the neigh- 
borhood of $178,000, in order to build up the business of the 
plant. Respondent asserts that this money was actually spent 
to promote and to develop the business ; that the expenditure of 
this sum was necessary to place the business on a paying basis ; 
that the investors have not received, as yet, any return from this 
expenditure ; and that this amount should be added to the value 
of the physical property of the plant to arrive at a just and rea- 
sonable basis for the determination of the valuation upon which 
thev shall be allowed to earn a reasonable return. 



Digitized by VjOOQIC 



280 



RAILROAD COMMI>^SION OP WISCONSIN. 




Digitized by VjOOQIC 



CiTV OF RACINE V. KACINE GAS IJGHT CO. 



281 



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Digitized by VjOOQIC 



282 RAILROAD COMMISSION OF WISCONSlll. 

Investigation of the records of the plant, covering the early 
period of its operation under the present management, discloses 
that great efforts were made to increase the sales of gas in Ra- 
cine. Statistics showing the growth of the business ot the com- 
pany, much of which has already been presented in this discus- 
sion, make it clear that the company has exerted great efforts 
along the line of promotion of business. The facts available 
show quite clearly that the company offered and granted induce- 
ments and concessions to consumers that entailed a large tem- 
ix>rary loss, at least, to the company in order to secure new 
consumers and increase the sales to old customers. That these 
efforts have Ijeen successful, is quite clearly indicated by the 
present condition of the business. Whether or not the expendi- 
ture of as large a sum as respondent claims was necessary to 
secure the development of the business to its present stage, and 
whether or not the amount claimed represents closely the actual 
amount expended for this purpose, is not so clearly seen. Pre- 
cisely in what manner these sums w^ere expended, and precisely 
what the condition of the business as regards the returns ob- 
tained by the investors has been in the past and is today, is still 
another question. 

The tabulation on pp. 280-281 gives a statement of the earnings 
and expenditures of the Racine Gas Light Company from 1900 
to 1909, uiclusive. This statement is as taken from the books 
of the company. 

In the foregoing tabulation of the earnings and exjxjnditures 
of the company it will be noted that the company has maintained 
an account "Promotion of business" under the head of general 
expenses. Comparing the entries imder this account, year by 
year, with the amounts shown under the head ^'Business" in the 
statement prepared and submitted by resix)ndent to show the 
cost of developing the business, reproduced previously in this 
discussion, we find that for the years 1902, 1903, 1904, 1905, 
1906 and 1907 the entries are identical. The company's statement 
gives the cost "I5usincss" for only 6 months of the year 1908. 

The amount given is approximately one-half of the total cost of 
*' Promotion of business" in the statement of earnings and' ex- 
penditures. Tt is evident, then, that in compiling the total cost 
of "Business," which total is a part of the $178,943 claimed by 
the respondent as proi>er addition to its valuation, respondent 
has taken from the oix^rating expenses for each year the cost 



Digitized by VjOOQIC 



CITY OP RACINE V. RACINB GAS LIGHT CO. 



28d 



of promotion of business. In other words, respondent wishes 
to add to the value of the plant costs which have already been 
included in the operating expenses of tlic plant and have already 
been deducted from the gross earnings, year by year. The 
question now arises, whether or not the net earnings of the 
plant have been great enough, after paying tlie above described 
promotion of business and all other legitimate operating exi>enses, 
to bring a reasonable return to the investors. 

The preceding statement of earnings and expenditures shows 
that after paying the expenses of operation, including taxes, and 
meeting interest charges, the company has had a surplus avail- 
able for dividends on common stock ranging from $25,988.39 in 
1906 to $48,645.75 in 1901. Inspection of the expenditures, 
however, shows that no allowance for depreciation, as such, has 
ever been made by the company. This fact, together with the 
fact that the funded debt of the company does not agree with the 
physical valuation, makes it necessary to present the matter of 
net earnings or return upon investment in a different form. In 
the following table the total gross earnings are shown for each 
year from 1902 to 1909, inclusive, together with the operating ex- 
penses, including taxes. Depreciation in this table has l)ccn com- 
puted at an annual rate of 2 per cent on the average value of the 
plant for each year. The average value for each year, as used in 
this connection, is as obtained and presented in a discussion and 
table previously presented under the title "Statement of .Average 
Value Each Year." 



] 


RECORD OF YEARLY 


' SITRPLUSES. 








1902 


1903 


1904 
$120,900 


1905 


1906 1907 1908 ' 1900 


Tot al irross earnings. . . 


$100,862 

16,260 

8.801 
8.033 
9.125 


1120.288 


$130,408 


8141.477 $150,668 

^37,564 $80,035 
0.224 0,1(H 


$177,l40i$180.022 


Total cost ffasdelivered 
to mains 

Total cost of distribu- 
tion 


$13,730 

5,951 
3,977 

9.886 


$25,676 

7.571 
3,604 
12.506 


$20,506 

8,670 
3.504 
12.928 


$44,482' $18,457 
8.104: 11.800 


Total cost of collection 
Total fireneral expenses 


4,404 5.220 5.177| 4,051 
13,415, 17,047 10.661 21.160 


Total of alK)vc Items 
Taxes 


i23.128 
4.334 
11,605 


$33,544 
5.744 

12,460 


|49.44<> $54,607 
5.733 6.2.>3 
13.088 13.506 


$64,687 $72,206' $77,514 
6.786 7. 4111 9.000 


$86,467 
11.605 


I depreciation at 2% 


14,400, 16,776 


18.720 


10,506 


Total above exiien- 
968 


130.067 
161,795 

10.6 


$51,748 
$68,^1 

11.0 


$68,267 r4.45(t 
$52,^ "$66^7 

8.0 8 3 


$85,882 $06,303 


$106,324 


$117,668 


(4urplus 


$35,505. $8Sjr5 


^1,816 


1r2iS4 


Per cent of average 
value of plant (ap- 
nroxinfkte) 


1 
7.7 ' 7.5 


7.7 


7.4 












I.I 1 







Digitized by VjOOQIC 



284 ItAlLliOAD COMMISSION OF WISCONSIN. 

The foregoing- tabulation sliows the earnings ot the company 
over and above all operating expenses, including taxes and de- 
preciation, and also shows the rate of return these earnings rep- 
resent upon the average value of the plant each year. It will 
be seen that the lowest percentage of earnings on inv'iestment has 
been 7.4 per cent in 1909 and the highest percentage was 11.0 per' 
cent in 1903. The average percentage over the eight years cov- 
ered was about 8.5 per cent. It will be noted that the average 
value for each year upon which the above percentages were com- 
puted, was determined by starting with the tentative vakiation of 
July 1, 1908, and subtracting the yearly construction and invest- 
ment as taken from the books ot the company to arr.ve at the 
cost of the plant at the end of each year. The total gross earn- 
ings and operating expenses are also as reported by the company. 
If we deduct from the construction account each year the 
amounts expended for illuminating, piping and connections, do- 
mestic fuel appliances and connections, which amounts practically 
agree with and denote the source of the sums shown in the state- 
ment of the cost of developing the business submitted by the re- 
spondent, and then add these to the promotion of business ex- 
penses, we will arrive at somewhat different results. Decreasing 
the yearly construction account will, of course, decrease the total 
amount each year to be subtracted from the valuation of July 1, 
1908, by the Commission's staff and will, therefore, increase the 
average v^alue for the years previous to 1908. Increasing the 
yearly operating expenses by the same amount will decrease the 
surplus shown for the years previous to 1908. T'ollovving out the 
process above outlined, we arrive at the following percentages of 
surplus to average value for the years included in the above table: 



1902 
1903 
1904 
1905 



7.0 per cent 
8.9 


1906 

1907 


6.8 per cent 

7.1 


7.5 


1908 


7.7 


7.6 


1909 


7.4 



In brief, the above results show that wh'jn the amounts ex- 
l)ended for promotion of business are all included in the operat- 
ing expenses and do not appear in the construction or investment 
account, the surpluses earned by the plant have been, from year 
to year, sufficient to re|)r()duce the return shown in the above per- 
centages. In other words, the company would have earned the 
rates of return given in the above list even if the amounts it 
claims to have expended ft)r (levelu])ing the business had been 
charged entirely to operating; expenses. 



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CITY OF RACINE V. RACINE GAS LIGHT CO. 285 

In this connection it may be well to quote from a previous 
decision of the Commission in which the matter of expenditures 
for prcmoting business was discussed in relation to the method 
of caring for these expenditures -in the account of the utility. 
It will be noted that both of the methods outlined have been tried 
in connection with the analysis of the expenses of ihe Raci4ie 
company. • 

**Jn a general way it can perhaps be said, that the greater 
the business of such a utility is, the lower are also its rates and 
the better the services it renders. Extensions in their business, 
even when secured through the expenditures of money and 
efforts, are therefore in line with sound business principles and 
in harmony with the best interests of the plant as well as of 
its customers. Expenditures for the development of the busi- 
ness, when reasonable and when well placed, would, therefore, 
seem to be legitimate and to constitute a charge that, in soni ? 
form, should be borne by the customers or by those who avail 
themselves of the services in question. Whelher these expendi- 
tures should be charged to construction and thereby l>ecome a 
permanent charge on the consumers, or be charged to the operat- 
ing expenses and thereby be wiped out about as incurred, are 
questions that cannot be settled inde])enden*.ly of the surround- 
ing conditions. When the rates and the earninjT^s of the utility 
are such as to yield a reasonable return to the investors if the 
expenditures in question are included in the operating expenses, 
then "operating expense" also appears to be the place to wh'ch 
they should be charged. When, on the other hand, the rates and 
earnings are not high enough to permit these expenditures to be 
charged to operating expenses without resulting in less than rea- 
sonable returns on the investment, then it would seem that until 
the earnings become adequate, at least, they should be charged 
to the cost of the plant. These rules are supported by reasons 
that appear to meet the requirements under ordinary conditions.!' 
State Journal Printing Co. z\ Madison Gas and Electric Co. 4 W. 
R. C. R. 501, 588, 589. 

The original cost of a plant is also an element that should 
l)e taken into consideration in determining its value for rate- 
making purposes. In fact, th's cost is often one of the most im- 
portant factors that enter into such determinations. In this 
case, however, we have net been able to obtain what we could 
regard as entirely reliable data as to. this cost. During its exist- 
ence the plant has changed ownershij). A considerable proj)or- 
tion of it was constructed l)y other than the present owners. 
The earlier records were, therefore, not available. It is, of 
course, a fact that the plant is carried at a certain cost on the 



Digitized by VjOOQIC 



286 RAILROAD COMMISSION OP WISCONSIN. 

books of its present owner. The cost there given, however, 
does not seem to meet the situation. For, hke most cost figures 
of the kind, it appears to inchide items that could hardly be re- 
garded as rele\'ant in these proceedings. Owing to the fact, 
however, that in computing the cost of reproduction of the plant 
as given herein the figures used as the cost of labor and material 
were the average prices for a series of years rather than the 
prices which prevailed at the time the appraisal was made, it is 
not unlikely that the original cost of the plant is quite closely 
represented by the above cost of reproduction new. At any 
rate, we have frequently foimd that, in cases where full data 
as to the original cost of plants were available and where the 
cost of reproduction had been compiled on the same bases as 
those used in this case, the original cost and the cost of repro- 
duction new were not far apart. 

From the facts thus brought out, it is quite clear that the 
invesment in the physical property of the plant is both actually 
and relatively somewhat greater than the amount that is ordi- 
narily required for such demands upon the plants as are made 
by its custcMners in this case. In fact, the situation in this re- 
spect is such that it is far from clear whether it would be equit- 
able to all concerned to fix rates in this case, the receipts from 
which will cover operating expenses and, in addition to this, a 
return for interest, profit and depreciation on the entire cost 
of reproduction of the plant at as high rates as those which 
might ordinarily be regarded as adequate in cities of this size. 
This statement is made advisedly, for it is obvious that opera- 
tors are entitled to reasonable latitudes in such matters and that 
it is sometimes exceedingly difficult to accurately determine fu- 
ture demands. 

The valuation of the plant that has been used for the calcu- 
lations in this decision consists of its cost of reproduction July 
1, 1908, as shown herein, plus the cost of the additions and ex- 
tensions that have been made since that time, and less $15,370 
lor real estate not used in the operation of the plant, and also 
less the $24,350 for paving, the cost of which has not been borne 
by the respondent. For the purposes of the calculations* in 
question, these cost-values were also so adjusted that for the two 
years that are covered by the computations the average value for 
the year rather than the total value at the end of the year 
would be shown. 



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CITY OP RAaNE V. RACINE GAS LIGHT CO. 



287 



APPORTIONMENT OF EXPENSES. 



The Racine Gas Light Company, respondent in this proceed- 
ing, furnishes gas to four general classes of consumers or 
branches of service, namely, illuminating consumers in Racine, 
domestic fuel and industrial fuel or power consumers in Racine, 
and the Kenosha Gas and Electric Company. The diagram on 
page 272 shows clearly the relative' growth of the illuminating 
and domestic fuel gas business of the company. Starting in 
1899 with sales to the various classes approximately equal, the 
records since that period show that the domestic fuel sales have 
increased far more rapidly than the sales to the other users. 
This is clearly shown by the diagram mentioned. 

The following table gives the total sales in M cubic feet to the 
various classes for the years 1904 to 1909, inclusive. Since the 
sales to Kenosha did not appear until the year 1907, the table 
shows the sales to the illuminating, domestic fuel and industrial 
consumers in per cent of total sales to Racine alone, while the 
Kenosha sales and the Racine sales are shown in per cent of the 
total sales for the years 1907, 1908, and 1909. 

GAS SALES TO THE VARIpVa CLASSES IN M CU. FT. 
Racine Gas Light Co, 





1904. 


1905 




1906. 


1907. 


1908 




1909. 






& 

34 

56 
10 




a 

8 

32 
:V) 
12 

ioo 


43,706 
76,838 
15,171 

135.715 

1 

1 


c 
¥ 

& 

.32 
57 
11 

100 


49.330 
85.377 
13,509 


£ 

33 
58 

9 

ioo 

95 
5 

Ioo 


48.598 
95,848 
10.960 

155,406 
26.398 


c 

8 

u 

« 

31 
62 

7 

ioo 

86 
14 


50.990 
102.678 
14,778 

168,446 

26.4rd 
194.919 


i 
s. 


niuniinatlnir 


39,07*2 
64,017 
11,*73 


40..*^ 
69.793 
14.758 

J125.088 


W 


Domestic fuel 


61 


Industrial fuel 


9 


Total for Racine.... 
Kenosha 


114.662 


100 


148,216 
7,757 


100 
80 

14 




114,662 


ioo 













Total sales 


125.088 


100 


135,715 


100 


155,973 


181.804 


100 


100 







The foregoing tabulation shows that the proj^ortion of total 
sales in Racine to illuminating consumers has fallen from 34 
per cent in 1904 to 30 per cent in 1909. During the same period, 
however, the total illuminating gas sold has increased from 
39,072,000 CU. ft. in 1904 to 50,990,000 cu. ft. for 1909. In- 



Digitized by VjOOQIC 



288 



RAILROAD COMMISSION OF WISCONSIN. 



dustrial sales have fallen off slightly as regards proi)orti(>n of 
total sales and have increased in amount only from 11,573,000 
cii. ft. in 1904 to 14,778,000 cii. ft. in 1909. Domestic fuel sales, 
on the other hand, have increased 6 per cent as regards propor- 
tion of total Racine sales and have increased in volume from 
64,017,000 cu. ft. in 1904 to 102,678,000 cu. ft. in 1909. Do- 
mestic fuel sales have represented each year more than 50 per 
tent of the total sales of the company. Kenosha sales were only 
5 per cent of the total in 1907, but this was due to the fact that 
the sales extended over only a part of the year. In 1908 and 
1909 the sales to Kenosha remained practically stationary at 14 
per cent. 



GAS SALES BY MONTHS TO VARIOUS CLASSES CONSI'MERS. YEAR 1905. 





Illumlnatinsr. 


Domestic 
M cu. ft. 


fuel. 

Per 
cent. 


1 
Industrial fuel. 


j Total sales. 


Month. 


M cu. ft. 


Per 

<*ent. 


1 M cu. ft. 


Per 
cent. 


h 

M cu. ft. 

n 


Per 

cent. 


January .... 


4.903 

U9) 


12.1 


4.195 
(41) 


6.0 


908 
(9) 


6.2 


, 10,005 


8.0 


February . . . 


3,801 
(40) 


9.4 


3,545 
(42) 


5.1 


1.012 
i (12) 


6.9 


i 8,338 


6.7 


March 


3.814 

(39) 


9.4 


1 4.731 

(48) 


,^■7 


1.238 
1 (13) 


8.4 


'' 9.783 


7,8 


April 


3.028 
(33) 


7.5 


5,020 

(54) 


7.2 


' 1.160 

1 (13) 


8.0 


9,217 


7.4 


May 


2.712 

(•-'7) 


6.7 


0.068 

(:»9) 


8.7 


1.413 

r 114) 


9.6 


10.193 


8.2 


June 


2,288 
(21) 


5.7 


7.190 
(66» 


10.3 


1.413 
(13) 


9.6 


10,891 


8.7 


July 


1.916 
(18) 


4.7 


7,m 

(69) 


10.7 


1.354 
(13) 


9.2 


10,730 . 


8.6 


Auifust 


1.968 
(19) 


4.9 


7.322 

(TO) 


10.5 


1,203 


8.2 


1 10.483 

1 


8.4 


September. . 


2.620 

(23) 


6.5 


7,451 
(66) 


10.6 

1 


1.265 
1 (11) 


8.6 


1 11.336 


9.1 


Ooto1)er 


3,692 

(32) 


9.1 


6. 808 

(58) 


9.8 


1,182 

(10) 


8.0 


11,682 


9.3 


Novemljer . . 


4,4.14 

(42.1 


10.9 


4.934 

(47) 


7.1 


1,234 
(11) 


8.4 


I 10.602 


8.5 


December. . . 


r>,3r>9 

(46) 

40. M4 , 
(32) ' 


13.1 

100.0 


5,069 

14:^) 


7.3 


1,315 

(11) 

14,706 
(12) 


8.9 
100.0 


1 11,743 


>3 


Total.... 


69.793 


100.0 


12 J. 033 


lOO.O 



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OTY OF BACINE V. RACINE GAS LIGHT CO. 



289 



GAS SALES BY MONTHS TO VARIOUS CLASSES OF CONSUHEBS, YEAR 1900. 




Illuminating. 


Domestic fuel. 


Industrial fuel. 


Total sales. 


Month. 


Mcu.ft. 


Per 

cent. 


Mcu.ft. 


Per 
cent. 


M cu. ft 


Per 
cent. 


M cu. ft. 


Per 
cent. 


January .... 


6.Wt 

(45) 


12.5 


0.883 

(48) 


6.7 


1 1,004 
1 <7) 


6.8 


14,251 




February . . . 


5.305 
(42) 


10.5 


6.412 

(50) 


6.2 


1 

1.063 

(8) 


7.2 


12,840 




March 


4.390 
(37) 


1.0 


0.368 
(57) 


6.3 


•■SJ 


7.2 


11.884 




April 


4,215 


8.4 


7,536 

l57) 


7.3 


1.332 

(10) 


9.0 


13.063 




May 


8,370 
(27) 


6.6 


\^> 


7.6 


i.m 
1 (^> 


8.0 


12.870 








June 


2,812 

121) 


5.5 


•(?i^ 


9.2 


i Ntt 


7.9 


13.831 




July 


2.261 

(17) 


4.4 


10.042 
(75) 


0.8 


1 

' 1.048 

1 (8) 


7.1 


13.351 








August 


2,313 

ll6) 


4.5 


10,951 
(76) 


10.6 


1.160 
(8) 


7,8 


14,424 






3,201 

(21) 


0.4 


11,047 
(72) 


10.8 


: ■« 


8.3 


15,468 




October 


4.415 

(28) 


8.6 


9,862 
(64) 


9.6 


1,316 
(8) 


8.9 


15,508 




November . . 


MU 


11.1 


8.417 
(54) 


8.2 


1.408 

(10) 


10.1 


15.907 

1 




December... 


•iSl 


12.9 


7.974 
(49) 


7.7 


1.735 
(11) 


11.7 


1 16.806 

1 


1 


ToUl 


^(SS 


100.0 


102.679 
(61) 


100.0 


"•S? 


100.0 


i 166.447 

1 


100.0 



In the foregoing tables the sales in Racine are shown for 
each month for the years 1905 and 1909, for each separate class 
of consumption. The percentages given in the columns headed 
"Per cent/' and opiX)site the sales in M cubic feet, are the per- 
centages which each month's sales bear to the total sales for 
that class for the year. The figures enclostjd in parenthesis, 
however, show the percentage of the total sales for each month 
which the particular month's sales to the particular class repre- 
sent. The same facts have been shown graphically in the dia- 
grams reproduced on pages 252 and 253 herein. 

Inspection of the tables and the diagrams will show that while 
illuminating sales reach their maximum in December, the do- 
mestic fuel sales are the largest during the months of July, 
August and September. The comparatively great var'ation in 
19— K. D. 



Digitized by VjOOQIC 



290 



RAILROAD COMMISSION OP WISCONSIN. 



the domestic fuel sales over the seasons may be explained by 
the use of other fuel during the winter months. It is interest- 
ing to note, further, that while the domesic fuel and illuminating 
gas sales are in almost direct variance as regards their maximum 
and minimum months, the industrial sales remain practically sta- 
tionary throughout the year. The effect of the variations of 
the sales to the several classes is to produce a composite seasonal 
curve which varies but slightly over the year. Total sales are, 
however, greatest during the autumn months. 

Further analysis of the tables and diagrams will show that 
the same monthly variations appear in both 1905 and 1909. Do- 
mestic fuel sales have shown the greatest increase, as has been 
noted. On the whole, however, the changes in the relation of 
the maximum and minimum months have been but of slight con- 
sequence during the five years from 1905 to 1909, inclusive. 

As regards the relation of each month's sales to each class 
to the total monthly sales of the plant, it will be noted that illu- 
minating sales are the greatest proportion of total sales during 
the winter months, while domestic fuel sales assume the largest 
proportion of the total during the summer months. Industrial 
sales hold at about 8 to 12 per cent throughout the year. Il- 
luminating sales, domestic fuel sales, and industrial sales are 
about 30 per cent, 60 per cent, and 10 per cent, respectively, of 
the total yearly sales, with the percentage increasing somewhat 
during the later years in favor of domestic fuel sales. 

Turning from sales to consumers, we are able to analyze the 
distribution of the consumers betw^een the several classes. The 
following table gives the distribution of Racine gas users for 
several years: 



DISTRIBUTIOX OF CONSUMERS. 
Racine Gas Light Co. 





Total Xo. 
of con- 
sumers. 

4,604 

4,8.35 

5. 122 

5,(V58 

5,970 1 

6.233 

6.667 

1 


NITMBBR U0ING 


TOTAI. USING. 


Year. 


TUuminat- 
ing only. 


Fuel 
only. 


Both. 


Ilium- 
inatlntf. 

V^ 

3.503 
3,840 

4>609 


Pael. 


190.T 


est2 

647 
725 
7JW 
697 
685 
703 


1.431 
1,544 
1,616 
1,744 
1.882 
1.9'-6 
3,058 


2,778 
3.060 
3,391 
3.5IM! 
3,906 


Ml 

4,3M 
4,881 

5.005 
5.964 


1904 

1905 


ItHW 


1VH)7 ... . 


iHdS 


190U 



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arr OF RACINE V. RACINE GAS LIGHT CO. 291 

The double meter system in use in Racine explains the classi- 
fication shown in the foregoing statement of distribution of 
customers. The total number of consumers using illuminating 
gas is obtained by adding to the number using illuminating gas 
only, the number using both fuel and illuminating gas. In the 
same manner the total number of fuel consumers have been de- 
termined. 

While those consumers who use illuminating gas only have 
increased in number by 81, or 13 per cent, since 1903, the con- 
sumers using fuel only have increased by 627 users, or 44 per 
cent, dxiring the same period. Again, it is noted that the in- 
crease of the number of consumers using both fuel and illumi- 
nating gas has been 1,355, or 53 per cent, since 1903. The in- 
crease in the total number of consvuners using illuminating gas 
in Racine has been 1,436, or 45 per cent, and in the total number 
of consumers using fuel gas in Racine, 1,982, or 50 per cent. 

Before proceeding to apportion the expenses of the respondent 
in order to arrive at a statement of unit costs upon which the 
rates may be constructed for the consumers in Racine, it is ob- 
vious that the cost of supplying the gas produced and trans- 
mitted to Kenosha should first be further inquired into. In 
order to obtain the facts necessary to make a fair and equitable 
division of the expenses between Racine and Kenosha, a thor- 
ough investigation of the methods of operation in both cities, 
the unit costs, the consumer statistics, and the growth of the busi- 
ness in both places was made. The results of this investigation 
have, to a large extent, been presented already in this discussion. 
It is evident that the Kenosha plant is involved to such an ex- 
tent in these proceedings that only the most thorough examina- 
tion of the operation and history of that plant would supply 
the facts necessary in this connection. 

In order to understand why the Kenosha company purchases 
coal gas from the respondent rather than manufacturing either 
water or coal gas itself, it is necessary to examine briefly the 
manufacturing equipment at Kenosha. Water gas only had 
been sold in Kenosha for several years prior to the signing of 
the contract with the respondent. For the manufacture of this 
water gas two 51^ foot water gas machines were in use, having a 
capacity of about 325,000 cu. ft. per day each. This capacity 
was ample to supply all the gas required in Kenosha at that 
time. A reserve capacity is necessary in all water gas plants, 



Digitized by VjOOQIC 



292 RAHiROAD COMMLSSION OP WISCONSIN. 

and the working capacity of the plant does not greatly exceed 
the capacity of one of the machines. It is probable, liowever, 
that even now the Kenosha plant would be able to manufacture 
all the gas used in Kenosha, although the growth of the gas busi- 
ness in that city has been rapid. The total holder capacity in 
Kenosha was, on the other hand, only 56,000 cu. ft., which is 
much below the minimum capacity required for satisfactory 
operation. 

The problem, therefore, which confronted the Kenosha com- 
pany at the time the contract was made with the respondent, was 
not manufacturing capacity, but was largely one of adequate 
holder or storage capacity. It was necessary that additional 
holder capacity be provided in Kenosha or that gas be purchased 
elsewhere. When we consider that the ownership of the two 
companies is the same, it helps to explain, to some extent at 
loast, why it was decided to build additional holder capacity in 
Racine and to provide a high pressure line for pumping the gas 
tc Kenosha rather than to install an additional holder or holders 
in Kenosha. 

An examination of the comparative costs of holders and 
high pressure line will show that it would have been cheaper to 
have built another holder in Kenosha rather than to have in- 
stalled additional holder capacity in Racine and to have provided 
the necessary high pressure line and pumping equipment for the 
transfer of gas to Kenosha from Racine. This fact needs no 
demonstration. Whether or not, however, the cost of producing 
the gas is lower because of its manufacture in Racine, taking 
into consideration the fixed cliarges on the added investment, is 
another ques«tion. The question would appear to l>e clearly as 
follows: Can the respondent company aflford to sell the gas 
transmitted to Kenosha at the price now paid by Kenosha for 
that gas ? 

In the following table there are reproduced the income ac- 
counts of the respondent company for the years ending Tune 30, 
3909, and June 30, 1910: 



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CITY OF RACINE V. RACINE GAS LIGHT CO. 



293 



INCOME ACCOUNTS. 





TEAR KHDINO 


Clabsification. 


June 30, 1900. 


June 30. 1910. 


OPERATIXG BKVSNUES: 

lUumliiatiDiir sras sales 


SdO.546 77 

102,770 15 

6,450 38 

13.488 95 


$65,710 27 


Fuel iras s&les 


108 904 47 


Power carnloirs 


9,441 58 


Salesto other public utilities 


14,233 45 






Total earnings f rmn gas , 


1183,266 25 
62.017 22 


$204,771 63 


Earnings from residuals (net) 


69.164 88 






Total operating revenues 


1245,282 47 


$273. H36 51 






OPSRATIIVO UFSHSKS: 

Production: 
Superintendence 


11,970 00 

12.01i 53 

512 06 

444 37 

67,827 60 

12.965 35 

4.200 57 

1,003 21 

3,800 39 

/,299 7a 
2.058 11 
2.058 11 
2.058 11 


$1,673 71 


Retort house labor 


14,094 01 


Purifying labor 




Miscellaneous labor 


271 71 


Coal carbonized 


75,166 64 


Bench fuel 


14,297 30 


8team 


3,977 14 


Retort house supplies and expenses 


858 76 


Purification supplies and expenses 


579 96 


Gas used by company and bolder stock adjustment 
(deduct) 


75/ 99 


Maintenance of benches 


1,757 00 


Maintenance of gas apparatus 


2.914 68 


Maintenance of buildings, fixtures and grounds 

Miscellaneous supplies and expenses 


3.475 60 
4,606 21 








Total production 


1109.613 63 


$123,010 84 






Distribution: 
Labor removing and resetting meters 


ioa&46 


$870 40 


Street department labor 


31 89 


Meter and fitting department labor 




73 78 


Customers' premises expenses 




2,033 87 


Pumping gas 




296 64 


Street department supplies and expenses 


1.030 39 
1.423 44 
1,628 78 

1,628 78 
2,772 50 


586 02 




782 51 


Maintenance of mains 


3, 179 67 


Main tenants of services. 


2,109 33 


Maintenance of meters 


4.218 66 






Total distribution 


19,418 36 


$14,163 n 






Commercial : 
Collection salaries and commissions 


$1,990 00 

1,368 07 

1.654 57 

603 13 

6.065 96 


$2.127 49 


Reading meters and delivering bills t . . . 

Collection supplies and expenses 


1.531 30 
1.069 06 


Uncollectible accounta. 


1,054 66 


Promotion of business 


8,487 32 






Total commercial 


iii,ni.r3 


$14,239 83 






General: 
Salaries of general oiHcers. 


S3, f 00 00 
2.402 80 

683 30 
1,313 71 

935 67 
1,185 66 


$1,990 00 


Salaries of general office clerks 


1,920 8H 


General ofHce rent 


76i 97 


General office supplies and expenses. 


1.275 60 


Law expenses— general 


1,572 K4 


Miscellaneous general exi)cnses 


806 90 


Railroad commission expenses 


5 45 








Total general 


110,131 14 


$8.335 64 






Undistributed: 
ipjprieii and damages 


$1,386 25 
1,871 30 


$2.109.V 


Insurance .". 


2,109 33 


MlsceHancH>us undistributed 


10 00 








Total undistributed 


$3,257 55 


$4,228 06 







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294 



RAILROAD COMMISSION OP WISCONSIN. 



INCOME ACCOUNTS-Concluded. 





YEAR BNDIRO 


CLAfiSiriOATION. 


June 30. 1909. 


June 30, 1910. 


Taxes 


$10,257 63 


$13,717 32 


Total ODeratinir exoetuea 


$154.440 08 


$177,090 06 






Nat ODeratliur revenuo 


$P0.$4C4« 
900 00 


$06.240 45 


Non-operatinflT revenue 


000 00 






OiosB income 


$91,142 44 


$06.840 45 






Interest on funded de bt 


$50.000 00 
2,201 00 


$50,000 00 


TntATCMfc An flnfttinif <?eht. 


4.01S 10 






Total Interest 


$52,201 00 


$54,018 10 






Net Inoome 


$38.94144 
90.000 00 


$42.827 95 


CoDunon stock dl Tldends 


nlwfS 






Surplus 


$8,941 44 


$9,819 72 







With the expenses as shown in the above income accounts, 
an apportionment between Racine and Kenosha is presented in 
the following table: 



APPORTIONMENT OP EXPENSES 
Between Racine and Kenosha. 



Items. 


Year ending June 30, 1000. 


Year ending Jnn«90, 1010. 




Total. 


Racine. 


Kenosha 


Total. 


Racine . 


Kenosha 


Total production expen- 
ses 


$109,613 63 
62,017 22 


$93,829 27 
53.086 74 


$15,784 36 


I12S.010 84 


$106,404 38 
50,827 62 


$16,606 46 


Net earnings from resi- 
duals 


8,990 48 69.164 88 


0,337 26 






Net cost of produc- 
tion 

Total distribution ex- 
peoMff 


$47,50^41 
9.418 35 
11,771 73 


$40,742 53 
9.019 48 
11,771 73 


$6.853 88 
906 87 


$53,846 96 
14.163 77 
14.239 83 


$46,576 76 
13.3t7 70 
14,230 83 


r,209 20 
8K06 


Total commercial expen- 
ses 










Total direct expenses 
Total ceneral exoenses 


$68,786 49 
10,121 14 

3,257 56 


$61,533 74 
10,121 14 

3,257 55 


$7,232 75 


$82,249 56 
8,335 64 

4,228 66 


$74,144 38 
8,335 64 

4,228 66 


$8,105 18 


Totol undistributed ex- 
penses.... ......,.,,.... 












Total above expenses 


$82,165 18 

$10,257 63 
16, 193 99 

154,364 54 
169,010 18 
173,655 83 


$74,912 43 

$9,067 75 
14,703 46 


$7,252 75 

$1.188 88 
1,490 53 


$94,813 86 


186.706 68 


$8,105 18 


Taxes 


$13,717 32 
16.906 05 


$12,180 08 
15.416 42 


$1,530 34 


Depreciation 


1.400 53 


Total expense s-in- 
terestatG% 

Total expenses-Inter- 
est at 6i% 

Total expenses-inter- 
est at 7% 


147.964 64 
152,071 39 
156.178 14 


16.309 90 
16.938 79 
17.477 60 


183.154 77 
187,964 49 
192,774 21 


165.558 46 
1W.829 49 
174.100 53 


17,506 31 
18.196 00 
18.678 60 











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CirroF BAaNB v. bactnb gas light co. 295. 

In the above apportionment of expenses between Racine and 
Kenosha the production expenses have been apportioned on the 
basis of the gas sold to the two cities. Distribution expenses are 
largely made up of items whidi are directly chargeable to Racine. 
The cost of labor removing and resetting meters, meter and 
fitting department expenses, customers' premises expenses, meter 
department supplies and expenses, and the cost of maintenance 
of services and meters, are all items of expense which are ob- 
viously incurred entirely for Racine consumers. Street depart- 
ment labor, street department supplies and expenses, and main- 
tenance of mains are divided between Racine and Kenosha in 
much the same proportion as the miles of mains devoted to the 
supply of the two cities. In the foregoing apportionment the 
commercial, general and undistributed expenses have been 
charged entirely to Racine. Taxes, depreciation and interest 
have been apportioned on the basis of the investment, charging 
to Kenosha only that part of the plant equipment actually de- 
voted to and made necessary by the Kenosha service. As re- 
gards the item of depreciation, it may be briefly stated that the 
depreciation reserve total shown was obtained by computing the 
reserve necessary upon each separate part of the entire plant 
on a 2 per cent sinking fund basis. Kenosha is. therefore, 
charged only with the depreciation on the investment repre- 
sented in (the holder, the high, pressure line, and the pumping 
equipment. 

The Commission has dealt fully with the matter of deprecia- 
tion in a number of previous decisions and there appears no need 
of going again into the discussion. In order to illustrate, how- 
ever, the process by which the reserve used w-as obtained, the 
depreciation computations are summarized briefly in the follow- 
ing table: 



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296 



BAlLKOAD COMMISSION OF WISCOKSIN. 



COMPUTATION OF DEPRECIATION ON DEPRECIABLE PROPERTY 

Of thb Racine Gas Light Co. 

Jane 29. 1910. 



Years life. 


Cost new 

minus 

scrap value. 


Per cent. 


Depreciation 
reserve. 


Manufaeture, 
5 


1153 

3,331 

226 

12.565 

1,106 

7.464 

65.374 

17.958 

32.218 

.3.771 

50.632 

2.092 

449 


.192 
.091 
.074 
.057 
.053 
.041 
.031 
.024 
.020 
.016 
.011 
.005 
.003 


629 37 


10 


dm 12 


12 


16 72 


15 


715 63 


16 


58 72 


20 


306 02 


25::::::;:::::::;;:::::::;::::;::.:::::;:. 


2.026 59 


30 


448 95 


35 


644 36 


40 


64 11 


50 


611 18 


75 


125 42 


100 


13 4r 






Total 


6197.631 




^.363 66 


Digtriimtion, 
10 


65.640 
60,300 
72.993 
98,366 
. 66.389 
5.262 


.001 
.041 
.031 
.011 
.005 
.003 


65t3 24 


20 

25 


2.472 30 
2.962 78 


50 

75 

100 


1.180 26 

398 32 

15 78 






Total 


6306,939 




9i$.S42 66 


Storaoe. 

50 


6129,860 


.011 


$1,568 32 






Kenwha Hioh Presmre Sv«tem. 

10 

15 


II 10 

3,272 

4.185 

541 

85,979 

1.203 


.0913 
.0578 
.0411 
.0312 
.0165 
.0118 
.0058 


$10 01 
876 


20 


134 15 


25 


129 74 


40 

SO 


920 
1,031 75 


75 


722 


Total 


195.441 




$1.330 83 








Grand total 


$731,871 




$15,095 49 









The above table shows the annual depreciation reserve on the 
depreciable property of the respondent computed on a 2 per 
cent sinking fund basis. Dividing the total cost new of the de- 
[jreciable property of the respondent into the depreciation re- 
serve, as computed in the above table, we find that the annual 
rate on the cost new of the depreciable property is about 1.92 
per cent. With the addition of depreciation on the 12 per cent 
designed to cover engineering, supervision and contingencies, 
etc., the annual depreciation appears as shown in the foregoing 
apportionment of expenses between Racine and Kenosha. 

On the basis of the total Kenosha expenses, as determined 
by the above apportionment, the cost per M cubic feet of the gas 
sold to Kenosha will appear as follows : 



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CITY OP RACTNE V. RACINE GAS LIGHT CO. 297 





Usinff interest at 


YiAit Endihq 




June 90. 1009. 


June 90. 1910. 


6 per cent 


90.61 
.10 
.05 


to.et 


6i per cent., 


.tti 


7 per cent 


.06 







The apportionment aboVe described may be termed an "addi- 
tional business" method of separation of expenses. It will be 
noted that Kenosha has been charged with no part of the com- 
mercial, general or umli.stribnted exi^ense. Again, taxes, depre- 
ciation and interest charges to Kenosha are based only upon 
that part of the investment which may be said to be devoted 
entirely to Kenosha and which the respondent has been coni- 
l:elled to install or set aside purely for the Kenosha business. 
No part of the land, buildings, breakwater, etc., has been as- 
sessed against Kenosha. It appears, however, that even on the 
''additional business" basis described, and with the strict limi- 
tations regarding investment chargeable to Kenosha, the cost 
per M cu. ft. of the gas sold to Kenosha is considerably higher 
than the price now paid by the Kenosha company. A careful 
analysis of the cost of the Kenosha gas a'ong the line of an 
"additional business" basis of apportionment will show that the 
unit costs above given are perhaps even lower than they should 
appear under such a method of computing unit costs. It appears 
upon investigation that there is a portion of the investment rep- 
resented in respondent's gss plant equipment which was not 
charged to Kenosha in the preceding apportionment, but which, 
in fact, owes its existence to the fact that gas is produced and 
transmitted to Kenosha and which should properly .be assessed 
against Kenosha. Taking into consideration the fixed charges 
on these items, the cost per AI cu. ft. sold to Kenosha will be 
raised to approximately 70 cts. under an "additional business" 
method of separation. 

The city of Racine, petitioner in these proceedings, asserted 
that the Kenosha gas should be made to carry a larger burden 
of expense than that determined by an "additional business" 
basis of apportionment. It was the contention of the petitioner 
that the Kenosha gas shared, to a considerable extent, in the 
investment in land, buildings, plant equipment, etc. Petitioner 
declared that a considerable portion of the total investment in 
respondent's plant wa$ devoted, in part at least, to the produC" 



Digitized by VjOOQIC 



298 



RAILROAD COMMISSION OP WISCONSIN. 



tion of the Kenosha gas and should, therefore, be apportioned, 
in part at least, to the Kenosha gas. If, then, we depart from 
the "additional business" basis of apportionment and divide the 
total expenses of respondent's plant between Racine and Keno- 
sha on the lines laid down by the petitioner, somewhat different 
results will be obtained. For the purpose of such a distribution 
of expenses as petitioner advocates, it is first necessary to make 
a separation of the investment in respondent's plant, and this is 
done in the following table: 

APPORTIONMENT OP THE INVESTMENT 

OF THE RACINC GAS LlOHT COMPANY BBTWEBN RAOINS AND KBNOSHA rOR 1909. 





Total. 


Racine. 


Kenosha. 


Production: 

Land 


140.000 

540 

123.673 

80.755 

7,123 

940 

3,509 






Intake 






Plant 






Buildings 






Tools 






Office 






HorH4^is, waifons and niis^^cllaneous.. ........ 










Total al)ove items 


$256,639 
30,706 




Add 12% 


! 






Total production 


1287.434 


0245.954 


041.480 







Storaife: 

Large holder 


089,505 
10,740 
47.816 

5,738 


089,505 
10,740 




Add 12% 




Small holder 


047,816 


Add 12% 




5,738 








Total storage 


0153,799 


0100,246 


ft&3.564 






DihtrlbiUlou: 

Low pressure mains 


0206,010 

58,166 

75,177 

1,914 

2.830 

2.046 






Services 






Meters 






T<x>ls 






OtHce 






Horses, et** 












Total aliove items 


0346,143 
41,532 






Add 12% 












Total 


0387,075 


0387,675 








Hl»rh pressure mains 


039,145" 
686 

8,464 
1,869 






High pressure meters 







High pressure pumping eijuipmeut 






Building apportionment 












Total al)Ove4 items 


050,164 
6,019 


09.210 
385 


046.954 


Add 12% 


5,634 






Total 


066,183 


03.595 


052.588 






Grand total 


1885,091 


0737.469 


$147,622 







The equipment has been divided, for puiposes of analysis, 
into production, storage and distribution; production equipment 
including land, buildings, machinery; storage including holders; 
distribution including high and low pressure mains, services and 



Digitized by VjOOQIC 



CITY OP RAdNB V. RAdNB GAS UGHT CO. 



299 



meters. Horses and wagons and office fixtures are apportioned 
between production and distribution on the basis of total invest- 
ment, except where use clearly indicates that certain equipment 
belongs in one group or the other. Production equipment is ap- 
portioned on the basis of the sales to the two cities. Holders 
are apportioned largely on the basis of present use, the smaller 
bolder being now used for Kenosha only. However, since the 
gas sold in the two cities in 1909, was Racine about 185,000,000 
cu. ft. and Kenosha about 82.000,000 cu. ft., this division is 
nearly on the basis of output, since, when the capacity at Keno- 
sha is included with that at Racine, the figures are 467,000 to 
1,000,000 cu. ft. 

Using the above division of property and figuring interest at 
7 per cent, and depreciation on a "straight line" basis, we get a 
division of expenses shown in the following table: 



APPORTIONMENT OP 1909 EXPENSES BETWEEN 
RACINE AND KENOSHA. 





Total. 


Radne. 


Kenosha. 


Items. 


ODeiat- 
ing. 


Int. and 
Dep. 


Operat- 
ing. 


Int and 
Dep. 


Operat- 
Inir. 


Int. and 
Dep. 


Productkni 


tloe,613 83 


96.940 90 

20.120 38 

1.604 88 

7,017 15 

916 30 

3.047 12 

9,403 62 

27,137 25 

1.184 91 

3.982 81 


103.282 96 


85.930 33 
17.217 01 
1.604 88 
7.017 15 


$15,790 67 
000 00 


$1,001 57 




2,906 37 


Btorace 
























916 30 




"^.iis'as 








3,047 12 


Low pressure dlstribut'n 


8.975 44 


9.403 62 

27,137 25 

75 83 

25165 


443 10 








Hlffh pressure 








1,109 08 






■'ll."77i"73 
8.060 60 
8,544 61 




3.081 16 


Commercial 


11.771 73 
10, IM 14 
10.257 63 








OunftnA 


• 




1.460 48 
1.713 02 




Taxes ........ 













.......... 




Total 


$151.182 76182,296 32 


S131.235 40 


$68,736 72 


$19,947 36 


$13,558 60 






Itotal 


1238.478 06 
62,017 22 

1171, 4fin M 


1 

1109.972 12 

53,068 14 

$146, 9(B flft 


$33,506 96 


Residuals (credit) 


8,949 08 


Net cost 


$24,55A fiS 






1 











The cost of production is apportioned on the basis of sales 
in the two cities. Since, under the contract, Kenosha may call 
on Racine for the entire amount used in Kenosha, it is not certain 
that the factor of demand should be neglected. Under storage 
only depreciation and interest are considered. The cost of 
maintenance and the cost of supplying steam and water to the 
holders are expenses which are included in production and can- 
not be readily separated. While these costs are not large in 



Digitized by VjOOQIC 



300 RAILROAD COMMISSION OP WISCONSIN.. 

the aggregate, still the method of apix>rtionnient outlined herein 
assigns less than the proper share of these expenses to Kenosha. 

Street department expense and maintenance of mains are ap- 
portioned % and l/^, approximately on the basis of miles of 
main in the two systems. Meter and service expenses apply 
to Racine alone. General expenses are apportioned on the 
basis of output. In view of the added responsibility of supply- 
ii g a distant city, the demand of which may be one-third of the 
entire demand, this basis would appear fair. Taxes arc divided 
on the basis of property used. The cost of pumping gas to 
Kenosha could not be determined exactly at the time the above 
apportionment was made. It was known, however, that the gas 
engine compressor used 1,047,800 cu. ft, of gas and the electric 
compressor 10,504 kw. hrs. The cost of both was taken as about 
$600, which allowed 2 cts. per kw. hr. for the electrical energy 
used. Later information, however, shows the above estimate to 
be below the actual cost of the pumping. The gas costs in the 
holder, including depreciation and interest, atx>ut 40 cts. per M 
cu ft. The sales during the year to Kenosha amounted to 
26,977,900 cu. ft., and, with a total cost of $24,656.54, gives a cost 
per M cu. ft. of 91.4 cts. 

The above cost per M cu. ft. sold fro Kenosha gives a pretty 
definite idea of the point which the unit cost of the Kenosha 
gas will reach when we consider the Kenosha gas as sharing 
in the total investment, and do not treat the investment and ex- 
penses on an ''additional business" method. From an analysis of 
the cost of production in both Racine and Kenosha, it wouM 
seem that in order to compete with the manufacture of gas in 
Kenosha under the conditions, it would Ije necessary to greatly 
increase the amount sent through the high pressure main. Un- 
der the preceding apportionment figures the conditions would 
seem to require that eight times the present send-out, about 
27,000,000 cu. ft., be delivered to Kenosha, or about the present 
total. output of respondent's plant. 

One other element should be considered in connection with the 
installation of the high pressure line between Racine and Ke- 
nosha. Racine manufactures coal gas exclusively, while Ke- 
nosha produces water gas exclusively. The water gas manu- 
facture appears more flexible than coal gas manufacture. Tbe 
equipment at Kenosha is capable of an output of 600,000 cu. ft. 
per day, for a period of about two months, after this it will be 
necessary to shut down the machines, one at a time, for the 



Digitized by VjOOQIC 



CITY OF BAGINE V. RACINE GAS UGHT CO. 301 

replacement of checker brick and repairs to lining. At the time 
the high pressure line was laid, the capacity at Racine was about 
900,000 cu. ft. at a maximum. This would give a combined 
capacity of the two plants of 1,500,000 cu. ft. for the greatest 
possible output, or a sale capacity every day of 1,000,000 cu. ft., 
assuming the Kenosha capacity to l>e the capacity of one water 
gas set and the average working capacity of 15 benches of sixes 
to be 750,000 cu. ft. A plant of this character could, however, 
easily meet a maximum day of 1,200,000 cu. ft. Such a maxi- 
mum day would, using the factor mentioned previously, give a 
yearly output of 300,000,000 cu. ft., which is about the combined 
output of the two plants for the year ending July 1, 1910. 

Under this arrangement it is likely that more purifier capacity 
would have been needed in Kenosha and slightly more condenser 
capacity than was provided in the orginal 600,000 capacity in 
Racine. It would also have been necessary to have provided 
some additional holder capacity in Kenosha. This scheme would 
have given greater reserve capacity to the Racine plant and 
more flexibility of operation in both cities. Up to the present 
time, liowever, as has been shown, the investment is so large 
that this plan would not appear to be economical. Since the 
capacity of the high pressure main is about 100,000 cu. ft. per 
hour and of the pumping equipment 60,000 cu. ft. per hour, it 
would have been possible, also, to have discontinued entirely 
the Kenosha plant and to have supplied all of the gas from Ra- 
cine. 

We have presented herein two apportionments of the expenses 
of respondent's plant between Racine and Kenosha. Under the 
"additional business" method of separation we found the cost of 
the Kenosha gas to be from 65 to 70 cts. per M cu. ft. sold. 
Under the other basis of apiX)rtionment we found the cost per 
M to go as high as 90 cts. In view of these facts and other 
facts revealed by the investigation, the conclusion seems inevita- 
ble that the respondent is now sui)plying gas to Kenosha at a 
lo.s.c. 

Some further light may be thrown upon the effect of the oper- 
ation of the Kenosha high pressure Hne by an analysis of the 
unit costs of operation of the Racine and Kenosha plants, cover- 
ing a period of years, which will show these unit costs both be- 
fore and after the installa«tion and operation of the high pressure 
line. These unit costs for both plants are shown in the follov/ing 
tables : 



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302 



RAILROAD COMMISSION OP WISCONSIN. 



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CITY OP EACINE V, EACINE GAS LIGHT CO. 



303 



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304 lUlLBOAD COMMISSION OF WISCONSIN. 

Analysis of the unit costs shown in the preceeding tables do 
not reveal any marked effect on the unit costs during the years 
1907, 1908 and 1909 by the high pressure line. Viewing the 
history of operation in both plants over the period covered by 
the tables, it does not appear that in either case have the unit 
costs been es|>ecially favorable to the plants during the years 
since the Kenosha line was installed. A strong argument was 
advanced by the respondent in this case to justify the low rate 
given to Kenosha. In effect this.argimient was, that larger pro- 
duction brought lower unit costs and justified the giving oi 
low rates to the consumers who used gas in exceptionally large 
amounts and, therefore, caused the large scale production with 
its supposed attendant low unit cost. While the unit costs for 
the Racine plant are lower in recent years than they were in 
1906 and 1907, at the same time they are not lower than in 
the earlier years 1904 and 1905. Especially is this true as re- 
gards coal carbonized. Turning to the Kenosha unit costs 
much the same conditions are evident. In short, the records in 
these plants do not indicate in any marked degree that lowering 
of unit cost which would result from larger production in order 
to justify lower rates. 

Another factor, perhaps worthy of consideration in this con- 
nection, is that the increase in the sales to Racine consumers 
since the installation of the high pressure system has been almost 
as great as the present yearly send-out to Kenosha. In the light 
of this fact it would seem that any lower unit costs due to in- 
creased production during the past few years may be due not 
alone to the additional Kenosha sales, but should perhaps be 
credited to the growth of the business in Racine, in part at least, 
as well. 

While, as before stated, we are forced to the conclusion that 
respondent is at present, and has in the past, furnished gas to 
Kenosha at a loss to the respondent, we can, at the same time, 
see no valid reason why the consumers in Racine should bear 
all or even a part of such losses. 

In order to arrive at the unit costs of operation of respond- 
ent's plant, which shall constitute a basis for the determination 
of fair and equitable rates for consumers in Racine, an apportion- 
ment of the expenses of the Racine plant has been prepared and 
is summarized in the following table: 



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CITY OF BA.CINE V. BACINB QAS UGHT C!0. 



305 



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Digitized by VjOOQIC 



306 KAILBOAD COMMISSION OF WISCONSIN. 

In the abov^ apportionment it will be noted that three classes 
of expenses liave been considered, naniely, output, capacity, and 
consumer expenses. These terms have been defined and the 
basis of such a separation has been explained in detail in pre- 
vious decisions of the Commission and we, therefore, do not dis- 
cuss these features herein. In the above apportionment pror- 
duction expenses have been considered as all output expenses. 
Under distribution expenses the items labor removing and reset- 
ting meters, meter and fitting department labor, custonier]s 
premises expenses, meter department supplies and expenses, and 
maintenance of meters are largely consumer expenses, although 
in part chargeable to output and capacity. Street department 
labor and maintenance of mains and services are largely ca- 
pacity expense. Commercial expenses, including such items as 
collection salaries and commissions, reading meters and delivering 
bills, collection supplies and expenses are all consumer expenses. 
Some differences will be noted in the apportionments for the two 
years, due to a slightly different treatment of promotion of busi- 
ness expenses, which in one year are charged entirely to output 
and consumer expenses and in the other year have been distri- 
buted over output, capacity and consumer charges. 

General and undistributed expenses have been treated as over- 
head charges and have been distributed on the basis of the total 
direct expenses. Taxes, imterest and depreciation have also been 
apportioned on the basis of the direct expenses. 

The total cost for the year ending June 30, 1909, $166,721.12, 
divided by the total gas sales, 187,130,000 cu. ft,, gives an aver- 
age cost of gas of $0,891 per M cu. ft. The totaJ cost for the 
year ending June 30, 1910, $185,8U.70, divided by the total gas 
sales, 210,934,000 cu. ft., gives an average cost of gas of $0,881 
per M cu. ft. 

In arriving at the unit costs from the figures obtained from 
the preceding apportionment, we arc confronted, . in this in- 
stance, with two divisions which are widely divergent. 

Due to the double meter system in use in Racine, the 
number of meters in use greatly exceeds the number of con- 
sumers. If it is found that the double meter system should be 
continued, the consumer expenses must be divided by the number 
of meters to arrive at the unit cost. If, however, the doubly 
meter system is discontinued, it is obvious that the number of 
meters and the number of consumers will be practically the same. 



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CITY OF RACTNE V\ RAaNB GAS UOHT CO. 307 

In the following table, in which the unit costs or cost curves 
have been computed, we have set down the unit costs on two 
bases, one in which the number of meters has been used as the 
divisor, the other in which the divisor has been the number of 
consumers, which, in other words, assumes that every consumer 
will have but one meter : 



Digitized by VjOOQIC 



308 



RAU.ROAD COMMISSION OF WISCONSIN. 



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1.001 
1.658 
2.315 

3.629 
8.914 
33.194 
88.0U 
328.844 

857.344 


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3.831 
7.116 

66.246 
319.048 

867.546 


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1.34 
1.971 
2.628 

3.285 
8.570 
32.850 
85.700 
328.500 

657.000 




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Consum- Meter 
er basU. basis. 


10.826 ; 10.647 
1.168 ! .980 
1.851 , 1.572 
2.534 2.365 
3.217 3.038 


8.900 3.721 

7.315 7.138 

34.635 , 34.458 

68.786 ' 68.606 

341.965 341.808 

G6S.485 ; 883.308 


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Digitized by VjOOQIC 



CltY OP RcVGINE 1'. RACINE GAS lAGHT CO. 309 

The unit costs ol>tained in the preceding table will show sev- 
eral facts. The output cost for the year ending June 30, 1909, 
appears as $0,683 per M cu. ft. sold ; for the year ending June 
30, 1910, it appears, under a slightly different method of appor- 
tionment, as $0,057 per M cu. ft. sold. These cos»ts remain alx)ut 
the same, whether one or 1,000,000 cu. ft. are used. The con- 
sumer costs are $0,485 an<l $0,546 per consumer, or $0,306 and 
$0,344 per meter, per month. Since these are fixed amounts, as 
the consumption increases the consumer cost per M cu. ft. de- 
creases. The total cost per M cu. ft., therefore, decreases with 
increased consumption and approaches the output cost as its limit. 
The table of unit costs brings out these facts mentioned and 
shows forcibly the fact that, as the consumption per month per 
consumer increases, the cost per M cu. ft. supplied to him de- 
creases. The unit costs will also serve, to a material extent^ 
in indicating what a fair and equitable rate schedule will be in 
this instance. 

It seems quite customary, in computing the unit costs of gas 
from the apportionment of expenses, to consider the capacity 
and consumer expenses as both chargeable to the consumer or 
meter. In the table of unit costs thus far presented, this has 
been done. As far as a basis of comparison is concerned, and 
for purposes of analysis and for constructing the cost curve, 
ithis process has its advantages. To combine these casts to ob- 
tain the actual ''consumer" expenses as a basis of a service charge 
or minimum bill, does not, however, seem as fair as it might be. 

It has seemed to us that the meter charge, or service charge, 
or minimum bill is in itself, as well as the rate per unit of gas 
consumed, founded upon costs, and from this as a basis it is cer- 
tain that the varying investment in meters upon consumers' 
premises, due to varying demands and, therefore, different sizes- 
cf meters, must be recognized in constructing the rate schedule. 

The tentative valuation gives the following details in regard 
to the cost of the various sizes of meters and their connections : 



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310 



RAILROAD COMMISSION OF WISCONSIN. 



COST OF METERS 



No. of metarg. 


Size (Uffbt) 


Cost per 
meter. 


ToUlCOM. 


1 


2 light 

3 

5 " 
10 " 
20 ** 

30 

45 ** 
00 

80 '• 
100 

200 
100 
BaaitableNo.6 


15 00 
500 

on 

833 
12 00 

18 38 
28 00 
36 tr 
50 00 
58 83 

116 67 


16, sS 


830r 




98,474 


117 


076 


62 


7U 


88 


697 


26 


728 


10 


S 


4 


200 


10 


668 


2 


20 









15 60 


94 






0619 






869,635 











Gartaffe on above meters. 
FreMrbt on meten 



8062 

sri 



Frelirht and cartaire 11.2 

•* per meter 



12.8 cts. 



METER CONNECTIONS. 
(These prices Inelude letting up and cartas to conotimer's premises.) 



No. of meters. 


Size. 


Coat per meter. 


Total cost. 


9,544 


3 & 5 li«ht 

i0&30 *' 

45 ft 00 " 

80 *' 

100 " 

200 " 


81.33 
1.61 
1.88 
2.45 
3.30 
4.14 
8.36 


tt2.g| 


117 


100 


188 


36 


88 


4 


13 


16 


68 


2 


17 






Total 






813,254 











Frelrht on conneetlons 835, which eauals 0.366 cte. per meter. 

Summarizing the above costs we get the following table of 
costs per meter of the meter, connections and freight, cartage 
and setting up of the meters. 

TOTAL COST OF METERS. 



Size. 



2 li^ht. 

5 •• ; 

10 ** . 

20 ** . 

30 *' . 

45 " . 

60 " . 

80 " . 

00 " . 

200 " , 



Meter. 



95.00 
5.00 
6.33 
8.33 

12.00 

18.33 
28.00 
36.67 
50.00 
58.33 

116.67 



Preljrht 


Connec- 


and 


tions 


cart aire 


setting 


on meters. 


np. 


90.128 


91.32 


.128 


1.32 


.128 


1.32 


.128 


1.61 


.128 


1.88 


.128 


1.88 


.128 


2.45 


.128 


2.45 


.128 


3.30 


.128 


4.14 


.128 


8.36 



Freight 

on 
connec- 
tions. 



90.003 
.003 

.ooa 

.003 
.003 

.003 
.003 
.003 
.003 
.003 

.003 



Total 

cost 

per 

meter. 



96.451 
6.451 
7.781 
lO.OTl 
14.011 

20.341 
30.581 
30.251 
53.431 
62.601 

125.161 



Digitized by VjOOQIC 



CITY OF RACINE V. RACINE GAS UGHT CO. 



311 



The above totals, then, show the cost of the meters as set up 
and connected on the consumers' premises. 

Computing depreciation on a straight line basis and allowing 
meters a life of twenty-five years, we will use 4 per cent as the 
annual depreciation rate on meters. Interest is assumed at a 
rate of 6 per cent per annum. The value of the meters and 
connections represents about 8 per cent of the total value new 
of the property and we, therefore, charge 8 per cent of the taxes 
or about $820 to meters. This amount must be distributed over 
the various sizes of meters according to the total value of each 
class or siz?. The following table gives the approximate cost 
of maintaining the meters upon the customers' premises : 

APPROXIMATE ANNUAL COST OF MAINTAINING METERS. 



2 llfirht. 

3 * . 
5 '* . 

10 •• . 

ao " . 

30 " , 

45 •• . 

60 " 

80 " . 

100 " . 

200 " . 



Size. 



Taxes. 



$0.0678 
.0659 
.1110 
.1583 

.2370 
.354 
.492 
.614 

.738 

1.640 



Deprecla-' Interest 
tion. 4%. 6%. 



I0.2S8 
.258 
.811 
.403 
.560 

.814 
1.223 
1.570 
2,137 
2.504 

5.006 



10.387 
.387 
.466 
.604 
.841 

1.220 
1.835 
2.355 
3.206 
3.756 

7.610 



ToUl 
cost. 



10.646 

.7128 

.8629 

1.1189 

1.S683 

2.271 
S.412 
4.417 
5.057 
• 906 

14.156 



Monthly 
cost. 



10.053 
.068 
.072 
.086 
.129 

.188 
.284 
.367 
.407 



1.134 



Turning from the fixed charges, such as taxes, depreciation 
and interest, there are several so-called "consumer" expenses, 
which are dependent upon and vary with the number of meters 
or consumers. The cost of reading meters and delivering bills, 
meter repairs, etc., are clearly in the latter class. It is both in- 
teresting and of value in this proceeding to present in this dis- 
cussion the unit costs of the so-called "consumer'' expenses. The 
following table gives much of the data along these lines : 



Digitized by VjOOQIC 



312 



RAILROAD COMMISSION OP WLSCONSIN. 



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CVtY OF kACINE V. RAaNfi GAS IAQWT CO. 



313 



The foregoing tabulation will give a clear idea of the items 
which go to make up the "consumer" expenses and enable com- 
parisons which show that the Racine costs are normal in all the 
items shown. 

Turning to the Racine Gas Light Company's annual reports 
to this Commission, we find the following items with their total 
annual cost: 



Item. 


Year endinir 
June 30, 1«O0. 


Year ending 
June 30, 1910. 


Labor removing and resettlDir meters 


1034 46 


1870 40 


Meter and flttinff dei>artment labor 


73 78 


Customera* premlM« expenses 




2.033 87 


Meter and fitting department sapplles and expenses. . . . 
Maintenance of services 


1.423 44 
1,«2^ 78 
2.772 50 
1,890 00 
l,3tt8 07 
1.654 57 
003 U 


782 51 
2. lOU 33 


Maintenance of meters 


4,218 96 


Collection salaries and commissions 


2, 127 49 


Beadlnff meters and deliverinir bills 


1,531 30 


Collect Ion supplies and expenses 


1.069 06 


U ncollectible accounts 


1,054 66 






Total of above items 


S12.464 95 


815,891 06 







Dividing the above amounts. by the average number of meters 
in use during each of the two years, we get a total cost per meter 
of about $1,228 and about $1,465, respectively, for the years 
ending June 30, 1909, and June 30, 1910. These figures give a 
cost per meter per month of about $0,102 and $0,122. Adding 
these costs to the fixed cost per meter previously determined, we 
obtain the following cost per meter per month of the various 
sizes : 

COST PER METER PER MONTH. 



Size of meter. 


Fixed charires. 


Total chartres year ending 




June 30. 1909. 


June 30. 1910. 


2 light 


80.053 
.058 
.078 
.085 
.129 
.188 
.284 
.367 
.497 
.582 
1.134 


10.155 
.160 
.174 

.231 
.290 
.386 
.469 
.589 
.684 
1.236 


10. 175 


* «l||^UV * 


.180 


5 '• 


.19i 


10 •* 


.207 


20 •* 


.251 


30 .*• 


.310 


46 *• 


.406 


00 •• 


.480 


80 •' 


619 


100 •• 


.704 


200 •• 


1.256 







It will be noted that the iteTn "freight and cartage'' has been 
divided equally among the total number of meters with no re- 
spect to size. While this is somewhat in error, still the charge is 



Digitized by VjOOQIC 



314 



BAILBOAD COMMISSION OF WISCONSIN. 



SO small as to make any error due to this method negligible in 
the total cost per meter. Again, the so-called ^'consumer*' ex- 
penses have been distributed with no regard to the size of meter. 
It may be argued that this is not strictly in accordance with the 
facts, since some of the costs, perhaps, vary with the size of 
the meter. This, again, we believe will aflfect changes which will 
not alter the final cost per meter to any appreciable extent. It 
is also noted that there are certain otiier items of ex|>ense which 
are not included in the list of consumer expenses given, which 
should be charged in part, perhaps, to this class of expenses. 

It is suggested that, in case the double meter system is abolished, 
the number of meters will be greatly reduced and, therefore, 
a reduction in the "consumer" expenses will follow. That the 
total cost of these items will be reduced in such case, needs no 
demonstration. On the other hand, it is evident that the greater 
portion of these expenses will not be reduced in proportion to 
the reduction in the total number of meters. A moment's study 
will make this evident. In fact, it is quite certain that while 
the total ^'consumer" expenses will be reduced to some extent, 
it seems equally certain that the unit cost or cost per meter will 
show but little reduction, if any. 

In the face of the facts thus far revealed, it appears certain 
that a fair and reasonable rate schedule must recognize, by its 
minimum bill or service charge, the varying cost per meter ac- 
cording to the size of meter used. Respondent's existing sched- 
ule makes provision in the minimum monthly charge for the vary- 
ing sizes of meters as follows : 





Size of meters. 


Amount to be 

charsred 

each month 


Where con- 
sumption Is 
leas than 


alight , 


10.25 

.25 

.35 

.35 

.50 

.60 

1.00 

1.50 

2.00 

4.00 


200 cu. ft. 


J •?."*' 




200 ** ** 


10 " 




300 •* " 


20 " 


300 •* ** 


30 *• 

45 " 


400 •• " 
500 " •* 


60 ** 


900 *' " 


80 " 

100 ** 


1.200 V " 
1,500 " " 


200 *' 


3,200 '• ** 







CcMnparison of the minimum charges above given and now in 
force in Racine, and the cost per meter as determined in previ- 
ous computations, will show a material excess of present charges 
over the "consumer" costs and fixed charges per meter. This is 



Digitized by VjOOQIC 



CITY OF RACINEJ V, RACINE GAS UGHT CO. 315 

to be expected It is clearly seen that where the minimum bill 
covers only the bare consumer costs and fixed charges, there will 
be no return to the company for the gas used by the consumer 
who pays the minimum bill. It is evident that a minimum charge, 
to 'be fair and equitable to the company, must not only guarantee 
those expenses which are incurred by the comptany whether the 
consumer uses much. or little gas or none at all, but must also 
be placed at a sufficiently high level that the cost of the gas ac- 
tually used by the minimum takers shall be paid for. 

What the margin should be in this case between the **con- 
sumer" expenses per meter and the minimum bill in order to 
make a proper allowance for the actual gas consumed by the 
minimum users in the various classes, must be determined by 
actual investigation of the consumer data. In order to accu- 
rately determine the character of the consumption of gas by 
the consumers in Racine, and in order to furnish an accurate and 
reliable basis for estimates, such as are necessary in this con- 
nection and in connection with the probable revenue computa- 
tions to follow, it was found necessary to take from the con- 
sumers' ledgers of the company a complete copy of the records 
for every month in the year 1909. This tabulation shows the 
amount of gas consumed by every gas consumer in the city of 
Racine each and every month for the entire year. The tabula- 
tion includes all consumers, whether they were full twelve month 
consumers or only received service for a part of the year. Since 
the double meter system is used in Racine, it was necessary in 
tabulating the consumer data to show two columns for each con- 
sumer for each month. Again, since the complaint in this case 
involved the question of abolishing the double meter system, it 
was found necessary to go through the entire consumer data and 
add the two columns shown under each month, so as to arrive 
at the total for each consumer, assuming that each consumer 
would have but one meter. It was further necessary to re-ar- 
range the entire data, so as to show for each month of the year 
the total amount of gas used by consumers whose meter read- 
ings (fuel plus illuminating) fell between certain limits. The re- 
sults of this compilation will be reproduced later herein. 

In re-arranging the consumer data so that the consumption 
was grouped according to amount consumed, we have obtained 
considerable information which enables us to determine fairly 
what the average small taker uses per month and what the al- 



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316 



RAILROAD COMMISSION OP WISCONSIN. 



lowance must be in order to make the minimum bill just and 
reasonable, as i)ointed out previously. 

DISTRIBUTION OF CONSUMERS— YEAR 1900. 



Consumption en. ft 


ToUl No. meter 
readings. 


Approximate 

average cu. ft. 

oonsnmplkm per 

oonsamer per 

month. 


0— 300 


3.028 
4,046 
11,500 
14,040 
13.564 
17.832 
6,978 
2,718 
2.b50 
1,046 
94 


161 


300— 400 


351 


500— 1,000 


737 


1.000—1.500 


1.200 


1,500— 2.000 


1,680 


2.0UO— 3,000 


2.380 


8,000— 4,000 


3.370 


4,000-. 5,000 


4.400 


5,000—10.000 


«.«»20 


10,000—60,000 


19.120 


Over 50,000 


93.750 






ToUl 


77,186 


2.2eo 







Inspection of the meter records of the company will show that 
the great majority of the meters, over 95 per cent, are of the 3 
and 5 light type. 

In view of these and other facts, it does not appear that the 
present graduated minimum charge of the company is unjust, 
inequitable or unreasonable. 

DISTRIBUTION OP CONSUMERS AND CONSUMPTION. 



Consumption 

cu. ft. 
(per month.) 


Total no. of ' Per cent 
meter of 
readinira, j total approx. 


Total flras used by 
consumers be- 
tween limits 
shown \n (1) 
cu. ft. 


Per cent 

of 

toUl approx. 


1 


2 


8 


4 


5 


0- aoo 

300— 500 


3,028 

4,o:6 

11,500 
14,040 
13,554 


3.9 
5.2 
14.9 
18.2 
17 A 


487.200 
1.420 200 
8.4n.O0O 
16.877,200 
2^,890,400 
41.373.000 
23,518.000 
11.9B4.400 
18.845.000 
20,030.600 
8.809.600 


.28 


500— 1,000 


4 82 


1,000- I. .TOO 

1.500. 2,000 


9.65 
13 1 


2.000— 3,000 


17.332 22.4 
6.978 1 9.0 
2,718 3.5 
2,850 3.7 
1,046 1.4 
94 .2 


23.8 


3.000— 4.000 


13.4 


4,000— 5,000 


6.83 


5, UOO— 10,060 


10 8 


io,ooa-,TO,ooo 


11.5 


Over 60, 000 


5 01 






Total 


77. 186 100 no 


174.668.600 


100 00 











The foregoing tabulation should be explained in some detail, 
perhaps, to make its significance entirely clear. It should be 
noted, first, that the total number of meter readings, as shown 



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CITY OP RACINE V. RACINE OAft LIGHT CO. 317 

in coluiBJi 2, is not actual in the sense that it represents the total 
number of meter readings taken during the year 1909. In the 
table conditions are assumed to be such that no consumer ha5» 
two meters, but that each consmner draws his supply through 
but one meter. In obtaining the figures given, the entire con- 
sumer data for each consumer in Racine and for each month 
in the year were analyzed and tabulated. When a consumer was 
found to have two meters, as is common in Rac'ne, the two me- 
ter readings were added together to secure the entire consump- 
tion for the consumer for each month, and such a consumer is 
counted as but one consumer. 

Each consumer's monthly consumption was then set down un- 
der the headings shown in column 1, and the result is that col- 
umns 2 and 4 in the above tables show the total number of con- 
sumers whose monthly consumption fell Ixtween the limits set 
down in column 1, and the total consumption of gas by the con- 
sumers whose monthly consumption fell between the same limits. 
It will be noted that only 3.9 per cent of the total number of 
meter readings (meter meaning consumer) were lower than 300 
cu. ft. per month, or, in other words, only 3,02^ monthly readings 
showed a consumption of less than 300 cu. ft. On the other 
hand, 17.332 meter readings showed monthly consumption of 
2,000—3,000 cu. ft., andi the total gas consumed by these con- 
siuners was 41,373,000 cu. ft., or 23.8 per cent of the total. 

It should, perhaps, be emphx -sized that the total number of me- 
ter readings in this case assumes that each consumer has but 
one meter. Some errors might reasonably be exj^ected in han- 
dling such a mass of data as is represented in the consumer data 
covering an entire year and showing the consumption of every 
meter for every month, but checking the totals in the above table 
by the totals refx>rted for the same year, we find tlhe error to be 
practicably negligible as regards its effect in the conclusions 
reached. 

The table is both interesting and valuable as showing the dis- 
tribution of the consumers and the consumption of gas in Racine, 
and brings oirt forcibly the prevailing types. 

In the following table the same material from which the above 
tabulation was derived has been arranged in a different form 
and tells a different story. This tabulation does not show the 
distribution of consumers and consumption according to total 
monthly consumption, but groups the consumers* monthly meter 



Digitized by VjOOQIC 



318 



RAILHOAD COMMISSION OP WISCONSIN. 



readings rather according to the rate of consumption. Where- 
a consumer uses 3,500 cu. ft. in a month, it is obvious that 1,000 
falls in the first M consumed, 1000 in the second M, 1000 in the 
third M, and 500 in the fourth M, The process by which the 
following table was obtained is then clearly seen : each consumer's 
monthly consumption is divided into that part which came in the 
first M consumed, in the second M consumed, and so on until 
the entire monthly consumption is accounted for. This classifica- 
tion furnished the totals upon which the computations as to prob- 
able revenue under various rates must be made. 



DISTRIBUTION OP GAS SALES. 
Year 1909. 






Racine 1909. 


Madison. 




Amount. 


Percent. 


Percent. 


1st M 


68,996,400 
43,191.600 
20,395,000 
9,292,000 
6.052.400 
10,295,000 
13,»6.600 
4,109,600 


30.4 

24.6 

11.6 
5.4 
2.9 
5.9) 
T.7V 
2.5f 


36.88 


2nd M 


23.28 


3rd M 


u!m 


4th M 


6.48 


Bth M 


3 70 


6th to 10th M (Inclusive) 




llth-50thM (Inclusive) 


(Madison 17.34 
iRacine 16.1 


Over 50th M 






Total 


174,668,600 


100.00 


100.00 







The table shows, then, that 68,996,400 cu. ft. of the gas con- 
sumed in Racine was consumed in the first M' used per month 
by the consumers. Here, again, it has been assumed that there 
is but one meter per consumer. The comparison with the Madi- 
son percentages reveals a marked similarity in the disftribution ol 
sales in the two cities. 

It IS evident that we have here data sufficiently accurate and 
reliable upon which to base the computations as to probable 
revenue under various sched/iiles. It should be noted in this 
connection that the gas sales for the calendar year 1909, as tabu- 
lated and analyzed herein, include the gas used by the company, 
which will average about 4,000,000 cu. ft. per year. The re- 
spondent's yearly statements of operating expenses show that a 
credit to production expenses has been made each year by re- 
spondent in order to properly handle this item. It is evident, 
then, that in computing the probable revenue of the company, 
some margin must be carried in order to provide for the gas 
used by the company, since the ded\Jction of the credit to pro- 



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CITY OF RACINE V. KACINE GAS UOHT CO. 319 

duction expenses on this account from the operating expenses 
would cause the total operating expenses to appear somewhat 
larger than they are shown in the respondent's statements of 
expenses. 

DOUBLE METER SYSTEM. 

The petitioner objected specifically to the double meter sys- 
tem. Petitioner claimed that since the gas used for fuel pur- 
poses and for illuminating purposes was the same gas and came 
from the same main, there existed no justification of different 
rates for the two. It is, of course, to the two-rate system that 
the double meter system owes its existence. If the same rate 
is given to both fuel and illuminating gas consumers, no necessity 
exists for the use of the two meters, one for domestic fuel gas 
and the other for illuminating gas. 

Whatever the reasons may have been for the adoption of the 
double meter system, it does not appear that the conditions in 
Racine, as respecting both operating conditions and demand', and 
the rates, demand a continuation of this practice. When the 
meter rate is made the same forT)oth fuel and illuminating gas, 
it is obvious that the necessity for the double meter system no 
longer exists. 

In view of the situation in Racine, as careful investigation 
has revealed it, and in view of the facts as regards the present 
rates and earnings of the company, the value of its property 
devoted to the production and distribution of gas to hs consum- 
ers, and its probable future growth, it appears that the following 
schedule of rates for consumers in Racine will be just, reason- 
able and equitable, as regards both the consumers and the com- 
pany; $1.00 per M for the first 4 M cu. ft. used per month: 
?0.80 per M for the next 11 M cu. ft. u.sed per month: $0.60 
per M for all over 15 M cu. ft. used per month. 

These rates are intended for net rates: that is, after the dis- 
count for prompt payment has been deducted, or before the pen- 
alty for late payment has been added. The schedule is also 
intended to apply to all Racine and interurban consumers, irre- 
spective of the use to which the gas is applied. 

The following table gives the probable revenue for the years 
ending June 30, 1909, and June 30, 1910, had the proposed rates 
rather than the present rates been in force: 



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320 



RAILROAD COMMISSION OP WISCONSIN. 



ESTIMATED REVENUES ONDER PROPOSED RATES. 
Excluding Kvnosha Salss. 



Ist 4 M per month 

Next 11 M per month. 
Over 15 M per month. . 
Forfeited discount.... 



Ybar eitdihg June 30, 1909. 



Rate 
perM. 



•1.00 
.80 
.tiO 



Toial 

Present revenues. 



Excess of present 
revenues over esti- ' 
mated revenues un- ; 
der proposed rates.. 



J 



Mcu. ft. 
sold. 



133,052.7 
1«,426.3 
14,783.6 



164,262.6 
164.2K2.6 



Revenues. 



1133.062 70 

13,141 01 

8,870 28 

1.246 83 



•156,310 72 
109.776 30 



•13,465 58 



Year ending June 30. 1910. 



Rate 
perM. 



•1.00 
.80 
.60 



M cu. ft. 
sold. 



151,196.2 
18,666.1 
16,790.4 



186.060.7 
186,660.7 



Revenues. 



•151.195 20 
14,932 88 
10.079 64 
1.483 61 



•177.691 33 
190.538 18 



•12,846 86 



It will be noted that the Kenosha sales and the revenue from 
these sales have been omitted both from the estimatc^i and pres- 
ent sales and revenues shown in the above table, Racine alone 
being considered. In estimating the revenues from forfeited 
discounts, we have assumed that the total revenue from this 
source will be one-half of the present revenue from the same 
source, since the discount under the proposed rates is 10 cts. per 
M, as opposed to 20 cts. per M under the present rates. The 
company has included in its statement of revenues from for- 
feited discounts the revenue from minimum bills. It is believed, 
however, that the total revenue from minimum bills, under the 
graduated scale of charges as embodied in the rate schedule, 
will be slight. 

In the preceding estimates of earnings no account has been 
taken of the receipts from the maintenance of apparatus and for 
piping and connections, etc. The net earnings from these 
sources will vary considerably from time to time. While the 
revenues from these sources should apj)ear under the head of 
non-operating revenues in the income account, it appears to have 
been the practice of the company to include the net earnings or 
deficits in the constniction account or additions to plant. For 
the year ending June 30, 1910, the annual report of the company 
shows a net profit on piping and connections of $1,670.54. This 
amount the company has not added to the non-operating revenues 
as prescribed by the "Uniform Qassification of Accounts," but 
has added to the additions to the plant during the year when, if 



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Cmr OP RACTNE V. RACINE GAS LIGHT CO. 321 

correctly included in this account, it should have been deducted 
from the total additions during that year. For the year ending 
June 30, 1909, the report of the company shows a net profit from 
piping and connections of $530.34, which amount was dedticted 
from the total additions to plant and equipment during the year. 
While, on the aggregate, these profits may average several hun- 
dred dollars a year, they are not of sufficient importance to 
affect the generaJ result. 

The number of cubic feet of gas to which each step of the 
schedule would apply is derived from the tabulation of consumer 
data for the year 1909, as previously described and explained. 
The same percentages obtained for that year have been applied 
to the years ending June 30, 1909, and June 30, 1910, one-half 
of each of which is included in the calendar year 1909. It will be 
noted that no change has been made in the rate for the Kenosha 
gas. It has been shown that careful analysis makes it appear that 
the respondent is now supplying this gas to the Kenosha company 
at a loss to respondent. It is also clear that the consumers in 
Racine must not be compelled to shoulder any of the burden of 
this loss. With these facts in mind, the total probable revenues 
have been computed by adding to the revenue from Racine 
consumers the present revenue, from the sale of the Kenosha 
gas, and the adjustments of this rate, if such adjustment is 
made, is left to the respondent to determine, subject to the re- 
view of the Commission. 

The following table has been prepared in order to furnish a 
direct comparison of the present and proposed rates. Two col- 
umns are necessary for the present rates, since there are sepa- 
rate schedules for illuminating and fuel gas consumers: 
21— R. D. 



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322 



RAILROAD COMMISSION OF WISCONSlNr 



A COMPARISON OF NET RATES 

Under Prbsint and Pbopoud SomDUUis. 

Charge p«r M. 



Cu. feet i>er 


Proposed 
rat6fl. 


Present 
rates. 


Decrease per M 
under proDOsed rates. 


moDth. 


Industrial 
and fuel. 


Illumlna- 
tinar. 


Industrial 
and fuel. 


lUumina- 
tlnff. 


1,000 


•1.00 

1.00 

1.00 

1.00 

.96 

^933 
.914 
.900 
.888 
.88 

.79 
.726 
.695 
.676 


•1.00 
1.00 
1.00 
1.00 
1.00 

1.00 
1.00 
1.00 
1.00 
1.00 

.90 
.866 
.80 
.76 


•1.20 
1.20 
1.20 
1.80 
1.20 

1.20 
1.80 
1.20 
1.80 
1.20 

1.20 
1.20 
1.20 
1.20 




•0.80 


t.flOO 




.20 


3,000 




.80 


4,000 




.20 


5,000 


•0.040 

.087 

.066 

.10 

.112 

.18 

.11 
.14 
.106 
.064 


.24 


6,000 

7,000 


.867 

.286 


8,000 


.30 


9,000 


:312 


10.000 


.38 


20,000 


.41 


30.000 


.474 


40,000 


.505 


50,000 


.524 







In order to note the effect of the proposed rates upon the 
monthly bills of consumers in Racine, the following table has 
been prepared. Thirty-two consumers have been selected, the 
list being made up of consumers of various type, showing small 
consumers, medium and large consumers. 

It will be seen that the small domestic fuel consumer receives 
no reduction. The small illuminating consumer, however, re- 
ceived a reduction of 20 cts. per M cu. ft. used. A consumer us- 
ing both illuminating and' fuel gas will have his monthly bill ma- 
terially lowered under the proposed rates. The industrial and 
power gas consumer will note a reduction in monthly bills, due to 
the fact that the proposed rates break at the 4th M and 11th M 
rather than at the 10th M and 30th M, as under the present rates. 
The fuel consumer who exceeds 4 M cubic feet per month will 
also note a decreased monthly bill under the proposed rates. 

The table follows: 



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CITT OV 8ACIN1S V. BAdNE GAS UGHT CX). 



323 



A COMPARISON OF MONTHLY BILLS 
UimiB Pbxssnt and Pbofosbd Batks. 





Month. 


CUBIC rr. COB8UMXP. 


MONTHLY BILL 
UNDBB 


Address. 


Light. 


Fuel. 


Total. 


Present 
rates. 


Pr'posed 
rates. 


Mftin 488 


Feb. 

Feb. 

April 

April 

Feb. 

Oct. 

June 

April 

June 

Dec 

April 
June 
June 
Auir. 
June 

Dec. 
June 

Oct. 

Feb. 
Feb. 
April 

Dec. 
Feb. 
Dec. 
Aug. 
Dec. 

Feb. 
June 


1,200 

18.800 

100 

"li.'ioo" 

6.700 
19,000 


"si.'wo ' 

12.400 
8.900 
11.900 

3,800 


1,200 
64,100 
12,500 

2,800 

23,800 

10.500 
18.000 
4,100 
6.100 
500 

210,600 
8.800 
2.000 
3.800 
5,200 

2.100 
2.000 

30.700 
4,600 

19,800 

2,800 
1,000 
16.600 
2,800 
7.400 

26.400 
3.000 
5,800 

16,500 
8,300 

6,600 
34.600 


81.44 
58.04 
12.04 
2.00 
25.80 

11.84 

22.80 

4.10 

6.38 

.60 

134.36 
3.80 
2.20 
3.88 
5.32 

2.52 

2.00 

26.42 

5.50 
20.76 

3.36 

1.10 

19.92 

3.84 

7.40 

30.48 
3.28 
6.26 

15.20 
9.88 

7.92 
28.76 


81.20 


"•418..........::..;;..;:;; 


36 26 


" 841 


10 80 


" Si::::;:;;::;;:::;::;;;: 


2.00 


Sixth 817 


18 08 


•• 815 


9 20 


WiseonalB 500 


15 20 


Tenth 1806 


4.100 
4.700 


4 06 


Stete 1808.... 


1,400 
500 


5 68 


" aS;;;;;;:::;;:;;::::: 


50 


Hamilton 


210.600 
8,800 
1.000 
8.400 
4.600 

"i'ooo" 

30,700 

160 

11.000 


130.16 


16th 1914 




3 80 


Grand 1831 


i.666 

400 
600 

2.100 


2 00 


•• 1686 


3 80 


Center 1428. 

• '* 1045 

180S , 


4.96 

2.10 
2.00 


Pierce Motor Co 




22.22 


18th 1088 


4.500 

8,300 

2,800 

500 

16,600 

2,700 


4.48 


Milwaukee 961 


15 38 


1714 


2 80 


Charles 1609 


500 


1 00 


Garfield Shoe Co 


13.76 


Sixth 218 


100 
7,400 


2 80 


Tenth 110 


6.72 


Main 601 


25,400 
1.400 
2.300 


19.04 


St. Claire 1017 


1,600 

3,500 

16,500 

400 

■"sijeoo** 


3 00 


1109 

Superior 1638 


5.44 
13.70 


Douglati 167ft 


7.900 
6.600 


7.44 


- 1890. 

Mead 718 


6.08 
84 56 








Total 




143.200 


406,400 


549.600 


8488.60 


8400.14 









Averace reduction in monthly bills of consumers listed above amounts to 16.2 ets 
per M. en. ft. 

ACCURACY OF METERS. 

Complaint was made by petitioner that actual tests made in 
Racine had demonstrated that a large number of the meters 
furnished by the respondent were inaccurate and registered more 
gas than was actually used by the consumer. The orders of the 
CcOTimission In re Standards for Gas and Electric Service have 
been issued since the complaint in this case was brought. These 
rules and regulations cover all the matters complained of by the 
peititioner in this case thoroughly. There would therefore ap- 



Digitized by VjOOQIC 



324 RAILROAD COMMISSION OF WISOONSIN. 

pear no need of making anything pertaining to the accuracy of 
meters a part of the order in this case. 



' . ORDER. 

It is Ordered, That the respondent in this case, the Racine 
Gas Light Company, discontinue its present schedule of rates 
for gas service to Racine and interurban consumers, and place 
in effect, as a substitute therefor, the following rate schedule, 
deemed just and reasonable, as provided under ch. 499, sec. 1797m 
—46, Laws of 1907: 

For all gas service furnished for lighting, fuel, industrial or 
power purposes, and passing through meter or meters owned 
and installed by the company, a charge of: 

$1.00 net or $1.10 gross per M cubic feet for the first 4 M 
cubic feet used' during any one month through any one meter ; 

$0.80 net or $0.90 gross per M cubic feet for the next 11 T^I 
cubic feet used during the same month through the same meter; 

$0.60 net or $0.70 gross per M cubic feet for all gas in excess 
of 15 M cubic feet used during the same month and passing 
through the same meter. 

The minimum bill shall be graduated according to the size of 
meter and shall be as follows: 

Size of Amount to be charged 

mcfter each month 

3-light JO. 25 

5 " 25 

10 " 35 

20 " 35 

30 " 50 

45 " 60 

60 " 1.00 

80 " 1.60 

100 " 2.00 

200 " 4.00 

Where company is unable to read meter after reasonable effort, 
the fact should be plainly indicated upon the monthly bill, the 
minimum charge assessed and differences adjusted when the 
meter can be read. 



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CITY OF RACINE t;. RACINE GAS LIGHT CO. 325 



Discount. 

Company shall bill all consumers the gross rate, and the differ- 
ence between the gross and net rates specified above, or 10 cts. 
per M cu. ft., shall constitute a discount for prompt payment. 

Company's present regulations that discount for prompt pay- 
ment shall not be granted after the days of the month as set 
forth in the consumer's bill, and as described thereon, is deemed 
reasonable. 

Maintenance of Burners and Appliances. 

Charges for the maintenance and replacement of illuminating 
burners and appliances shall be reasonable and' in accordance with 
the schedule of charges filed with the Railroad Commission. 

Re-connection of Meters. 

For the re-connection of meters for the same consumer upon 
the same premises, a charge of $1 is deemed reasonable. 

Thirty days from the date hereof is deemed sufficient time 
within which to comply with this order. 



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326 raitjBoad ooif mission of Wisconsin. 



NATIONAL REFINING COMPANY 
vs. 

CHICAGO AND NORTH WESTERN RAILWAY COMPANY, 
CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY, 
CHICAGO, BURLINGTON AND QUINCY RAILROAD COMPANY, 
LA CROSSE AND SOUTHEASTERN RAILWAY COMPANY, 
GREEN BAY AND WESTERN RAILROAD COMPANY. 



BARTLBS-MAGUIRB OIL COMPANY 

YS. 

CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY, 
CHICAGO AND NORTH WESTERN RAILWAY COMPANY, 
CHICAGO, ST. PAUL, MINNEAPOLIS AND OMAHA RAILWAY 

COMPANY, 
CHICAGO, BURLINGTON AND QUINCY RAILROAD COMPANY, 
DULUTH, SOUTH SHORE AND ATLANTIC RAILWAY COMPANY, 
GREEN BAY AND WESTERN RAILROAD COMPANY, 
ILLINOIS CENTRAL RAILROAD COMPANY, 

KEWAUNEE, GREEN BAY AND WESTERN RAILROAD COMPANY, 
LA CROSSE AND SOUTHEASTERN RAILWAY COMPANY. 
MINNEAPOLIS, ST. PAUL AND SAULT STB- MARIE RAILWAY 

COMPANY, 
WISCONSIN AND MICHIGAN RAILWAY COMPANY. 



Submitted Dec, 13, 1910. Decided Jan. 27, 1911. 



Petitions alleging that the less than carload rates on certain classes 
of petroleum products from La Crosse and Milwaukee to 
Wisconsin points are unjust and unreasonable, In that the re- 
spondents exact the third class rate instead of the fourth 
class rate or less, which the petitioners deem reasonable. It 
appeared from the testimony that the carload rate paid by the 
Standard Oil Co. from Whiting, Ind., its shipping point, to 
Wisconsin points, distances about seventy miles greater than 
those covered by shipments from Milwaukee to the same 
points, is about equal to the fifth class rate from Milwaukee, 
somewhat lower than the fourth class rate and about half of 
the third class rates now in effect; that the Wisconsin rates are 
higher than the rates in other states where similar commercial 
conditions prevail, and higher than the rates on similar com- 
modities. 

Held: That the rates for petroleum products should not exceed the 
rate of charge for articles that come In class four of the west- 



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NATIONAI, REPINING CO. ET AL. V. C. & N. W. R. CO. BTT AI,. 327 

em classification. Respondents are ordered to discontinue 
tbe preaent classification and rates and that in lieu thereof 
petroleum and its products take fourth class rates. 

The above entitled cases involve the less than carload rates 
on certain classes of petrcrfeum products within Wisconsin. The 
petition of the National Refining Company, located in La Crosse, 
Wis., complains that the third class rates in effect from La 
Crosse to Wisconsin points are unjust and unreasonable, and 
subject the complainant to great loss and disadvantage, and that 
the fourth class rates would be reasonable for such service. The 
petiticwi of the Bartles-Maguire Oil Company, a Milwaukee 
wholesaler, makes practically the same allegations as to the third 
class rates in effect from Milwaukee to Wisconsin points, and 
suggests that scmiething less than fourth class rates would! be 
reasonable. 

A number of the respondent railway companies in each case 
filed separate answers, all of which admitted that the rates 
charged on less than carload shipments of oil in Wisconsin are 
third class rates, but denied the unreasonableness of such rates 
and the reasonableness of the fourth class rates for such service. 

The petition of the National Refining Company came on for 
hearing at the office of the Commission Nov. 9, 1910, and further 
hearing in the matter was held in conjunction with that in the 
Bartles-M<sguire Case, Dec. 13, 1910. The appearances were as 
follows: For the petitioner in each case, C. D. Chamberlain; 
for the Chicago & North Western Railway Company, W. G, 
Wheeler and H, C Ckeyney; for the Chicago, Milwaukee & St. 
Paul Railway Company, William Ellis; for the Chicago, Burling- 
ton & Quincy Railroad Company, Woodard & Lees; for the 
La Crosse and Southeastern Railway Company, W. S. Burroughs; 
for the Illinois Central Railroad Company, Jones & Schuhring, 

It appears from the testimony that the petitioners find con- 
siderable difficulty in competing with the Standard Oil Company 
in the sale of gasolene and kerosene, for the reason that that com- 
pany has 154 tank stations in Wisconsin, to which it ships in 
carload lots, and from which it distributes to surrounding terri- 
tory by tank wagons. A statement submitted at the second 
hearing tends to show that from Whiting, Indiana, the point of 
origin of the Standard Oil Company's carload shipments, to the 
Wisconsin points at which its tank stations are located, the car- 
load rate on gasolene and kerosene is about equal to the fifth 



Digitized by VjOOQIC 



388 KAttiHOAtl CJ0MM4ll«|0» op WISCUNlOl^. 

class rate Iroiii Milwaukee to the same points, is somewhat lower 
m an cases than tne lourth class rate^ and is in general about half 
of the third class rate at present in effect on less than carload 
shipments ; while the distance covered by the Standard Oil Com- 
pany's shipments from Whiting averages about seventy miies 
greater than that covered by the shipments from Milwaukee. 

llius, to select a lew stations in various parts oi Wisconsin 
from among those enumerated* in the statement, we find that the 
carload rate Irom Whiting to Ashland, Wis., is 20 cts., while 
the third class less than carload rate from Milwaukee is ^4 cts.; 
to tau Claire, from Whiting 20 cts., from Milwaukee 40 cts.; to 
Ushkosli, from Whiting 10 cts., irom Milwaukee 24 cts.; to 
La Crosse, Irom Whitmg 18 cts., from Milwaukee 33 cts.; to 
Madison, Irom Whiting 7 cts., from Milwaukee 29.5 cts.; to Be- 
loit, liom Whiting 7 cts., from Milwaukee 19.5 cts. 

To justify this difference between Wisconsin less than car- 
load and interstate carload rates a witness for the Chicago, Mil- 
waukee & St. Paul Railway Company testified that actual in- 
vestigation had shown that, although less than carload freight 
comprised but 7 per cent of the entire tonnage of his road, it 
contributed about 30 per cent to its revenues. From this fact 
it was argued that the rate on less than carload freight should 
average over four times that on carload freight, whereas in this 
case the average less than carload rate is only about twice the 
carload. This method of justification was attacked by the peti- 
tioners, whose testimony showed that in actual practice carload 
rates are about 60 per cent of less than carload rates. 

Under the present rates, the officers of the National Refin- 
ing Company testified that it was impossible for them to ship 
more than 75 miles from La Crosse, and that for that maximum 
distance the cost of distribution was about 93 cts. per barrel, 
while under the fourth class rate prayed for they could ship an 
average of 150 miles at the same cost. The Standard Oil Com- 
pany, on the other hand, with its tank stations located, on an 
average, nineteen miles apart throughout the state, can make tank 
wagon distribution^ it is asserted, at a cost of about 35 cts. per 
barrel. Under these conditions the only kind of competition 
in which the so-called independent oil companies are able to make 
any headway, is in different grades of oil from those handled by 
the Standard Oil Company's tank wagons. Only the cheaper 
classes of kerosene and gasolene, it seems, are distributed by the 



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NATIONAL REPINING CO. ET AL. V. C. & N. W. R. CO. ET AL. 329 

wagons, and by handling higher grades the petitioners are able 
to meet a somewhat different demand. At the same time, since 
the higher grades handled by the independent ccMnpanies come 
from more distant paints of origin and pay a higher initial 
freight rate than those of the Standard Oil Company shipped 
from Indiana, and since the distribution of the higher grades 
must be by less than carload shipments, the increased cost to the 
retailer, who pays the freight, often makes it unprofitable for 
him to buy of the petitioners and compete with the tank wagons. 
This fact is borne out by nearly a score of letters, introduced 
by the National Refining Company, from local dealers in Wis- 
consin, complaining that, on account of the high freight rates 
from La Crosse, they cannot patronize the petitioner as freely as 
they would if rates were more favorable. 

In addition to the difficulty of competition under the present 
rates, the existence of lower rates in other states is relied upon 
by the petitioners as an indication of the unreasonableness of the 
rates complained of. An exhibit was introduced, showing the 
relation between the present Wisconsin rates, the fourth class 
rates prayed for, and- the existing rates in a number of other 
states. The following abbreviated table illustrates the compari- 
son: 

Rate in Cents. 



Miles. 


wis. 
third 
class. 


Minn 


Iowa 

7.0 
7.4 
7.8 
8.2 
9.4 
10.4 
11.2 
12.0 
13.6 
15.3 
17.0 
18.6 

54% 


111. 


N.D. 


S. D. 


Mo. 


Kan* 


Wi8. 
4th 
clas?. 


5 


7.0 
9.0 
10.0 
12.0 
18.0 
21.0 
24.0 
250 
2rt.5 
27.5 
29.5 
33.0 


6.0 
6.5 
7.0 
7.5 
9.4 
11 4 
13.3 
15.3 
17.8 
20.2 
22.7 
25.1 

66% 


7.5 
9.0 
10.5 
11.3 
14.3 
17.3 
19.0 
19.9 
21.1 
22.2 
23.3 
24.4 

80% 


5 
5 
7. 
8 
14 
18 
20 
22 
24 
27 
29 
32 

89% 


5.4 
7.2 
7.6 
8.0 
9.2 
10.2 
11.0 
11.8 
13.8 
15.8 
17 8 
19.9 

78% 


6.7 

7.2 
7.6 
8.0 
9.2 
10.2 
11.0 
11.8 
13.8 
15.8 
17.8 
19.9 

55% 


4.0 
4.5 
5.0 
5.5 
6.5 
7.5 
8.0 
8.5 
9.0 
9.5 
9.5 
10.0 

35% 


6.0 


10 


8.0 


15 


9.0 


20 


10 


40 


13.0 


00 


15 


80 


17.0 


100 


19.0 


125 


20.5 


150 


22.5 


175 


23.5 


20O 


24.5 






A V. per cent relaUon to pres- 
ent Wisconsin rates 


77% 









* Rates given for Kansas are double line rates. Slnarle line rates arerare about 1.5 
cts. lower than double line rates. 

The respondents' testimony in regard to these lower rates in 
other states tended to show that they were, in most cases, put in 
eflFect by order of state commissions and not voluntarily by the 
railroads. In the case of Illinois, in particular, where the rates, 



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330 RAILROAD COMMISSION OF WISCONSIN. 

although third class, are somewhat lower than the third class 
rates in Wisconsin, the reasons for the lower rates were given 
as the density of the traffic and the necessity of protecting Illi- 
nois jobbing centers against the competition of jobbing centers 
in Indiana and Ohio. In the case of Iowa, the eflFect of the lower 
rates was said to be considerably neutralized by the fact that 
no joint rates are in effect in that state. The petitioners claim 
that commission-made rates, not being contested by the rail- 
roads, are prima facie as reasonable as rates voluntarily made. 

In further proof of fhe unreasonableness of the present third 
class rates in Wisconsin, the petitioners on the first hearing in- 
troduced a statement showing a large number of commodities 
which take fourth class rates and are stated to be necessities of 
life, transported in a manner similar to l^s than carload ship- 
ments of oil. The list includes such articles as animal food, flour, 
rice, soap, sugar, axle grease, lime, vinegar, mineral water, cider, 
grease, road sprinkler compound, salt, canned preserves, tar, lard, 
and paint. A witness for the Illinois Central Railroad Company 
testified that the lower rates on a number of these commodities 
were the result of lower hazard and greater weight, although 
neither of these elements was controlling in any case. 

On the part of the respondents, a considerable part of the 
testimony as to the reasonableness of the present rates was in- 
troduced to show the high cost of less than carload oil shipments 
to the railroad company, due to the daftger of contamination of 
other merchandise. Although no figures are presented to show 
what the actual loss from such contamination is, witnesses for 
several of the roads testified that it occurred very frequently. 
Where the amount of business warrants it, several of the roads 
run special cars for less than carload oil shipments one or two 
days a week, in order to avoid this danger of damage. Unless 
special cars are set apart in this way, it is said that the danger 
to other articles shipped in the same car with oil, or even in a car 
in which oil has been shipped, is very great. Moreover, it ap- 
pears that oil shipments must be handled rapidly. Witnesses 
for the respondents admitted on cross-examination that other 
articles, such as fertilizer and hides, present the same risk of con- 
tamination in a greater or less degree. 

It is the further claim of the respondents that any reduction 
of rates which would assist the petitioners, would likewise assist 
the Standard Oil Company, and in substantiation of this stat^* 



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NATIONAI, REFINING CO. BT AL. V, C. & N. W. E. CX). BTJ AI,. 331 

mcnt it was shown that the less than carload shipments of the Na- 
tional Refining Company on the Chicago & North Western Rail- 
way from La Crosse, in three summer months of 1910, produced 
a revenue to the road of about $104, while the similar shipments 
of the Standard Oil Company in the same period amounted to 
about $113. The establishment of the fourth class rate prayed 
for would have reduced- the charges to the National Refining 
Company by $28, and to the Standard Oil Company by $31. 
An examination of the records from which this statement was 
made, indicates that the less than carload shipments of the Stand- 
ard Oil Company referred to were largely shipments of lubri- 
cating oil, turpentine, etc. As \o these commodities, the peti- 
tioners make no complaint, since they and the Standard Oil Com- 
pany are on the same footing, both shipping such commodities 
in less than carload lots at the third class rate. 

It was urged by a witness for the Chicago & North Western 
Railway Company that the only effect of a reduction in rates 
would be to place the competitive disabilities of the petitioners 
upon the railroads, and he suggested that if the petitioners 
wished to compete successfully with the Standard Oil Company, 
they must meet that company with its own methods and establish 
tank stations. On the other hand, the petitioners' representa- 
tives testified that with over 150 Standard Oil tank stations in 
the state, there was not room for more, and, moreover, that the 
cost of each tank station was several thousand dollars and an 
irtv^tment which would in any degree rival that of the Standard 
Oil Company would be out of the question. 

For the intrastate traffic in Iowa, Minnesota and the Dakotis 
petroleum products are quite generally placed in the fourth class. 
This is also, for the most part, true of the interstate traffic of 
these products between these states. In Wisconsin petroleum 
products are always placed in third class for intrastate traffic, 
and largely also for the interstate traffic. These facts, in con- 
nection with the further fact that the rates for this class for 
this state on both the intrastate and interstate traffic are quke 
high, go far towards furnishing the immediate explanation why 
on the products in question the rates are higher in Wisconsin than 
in the other states named. 

Are there, then, any good reasons for this state of things? 
This is a question that should be answered before we can pass 
upon the issues in this case. As has already been pointed out, 



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332 RAILROAD COMMISSION OP WISCONSIN. 

the respondents in various ways attempted to justify a higher 
rate level for Wis-consin than for the surrounding states, but 
these attempts, it appears to us, fail to cover the ground. Nor 
have we, in the inquiries which we have made upon this point, 
discovered anything that would fully warrant any such differ- 
ences in the rates against this state as have been pointed out above. 
On the other hand, we have in this investigation found much 
that points in the opposite direction. In Wisconsin, for instance, 
ithe traffic density is greater than in most of the states men- 
tioned herein, and we know from experience and investigation 
that the cost per unit of transportation usually varies inversely 
with the traffic density. Since this fact in this case does not 
appear to be offset by any other elements, it would seem that the 
cost of transportation in Wisconsin ought to be lower rather than 
higher than in the other states mentioned, and that the condition 
should, in some way, be reflected in the rates. 

Commercial conditions in other respects would seem to be 
about the same in practically all of these states. In fact, the 
circumstances are such that there can be no material differences 
between most of them, either in the value of the products in- 
volved or in the purchasing power of those by whom they are 
i;sed or consumed. These states, while covering a large area, 
are located in the same section of the country, where industrial 
conditions are similar. They are reached by the same carriers, 
and three among them have lake posts. The average distance 
from the points where the products in question are produced to 
the various consuming points in these states will not be found 
to be located far away from some point in Wisconsin. These 
products or commodities liave also, upon examination, been found 
to be rather closely analogous to commodities that in the west- 
ern classification are mostly placed in the fourth class. 

In view of these facts it would seem that unless the rates in 
question are unreasonably low in the other states, the rates com- 
plained of herein must be unreasonably high in Wisconsin. In 
fact, the amount by which the rates complained of are so much 
higher than Ithe rates in the other states with which they are 
compared, that there would seem to be room therein for some 
reductions, even if the rates in some of the other states should 
be found to be below rather than above a reasonable level. 

While in cases of this kind the rates on like commodities 
in other sections where conditions are similar are important, not 



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NATIONAI, REPINING CO. ET AL. V, C. & N. W. R. CO. BT AL. 333 

only because they may disclose existing inequalities but because 
they may serve as bases upon which readjustments may be made, 
they are not often the only factor, or even the controlling factor 
in these respects. Since the carriers are ordinarily entitled to 
earnings for their services that will yield reasonable returns on 
the fair value of the investment, and since these earnings should 
be derived from rates that are more or less closely adjusted to 
the value, etc., of the products transported, it would seem to fol- 
low that the cost of the services to the carriers, and the propor- 
tion of this cost that should be borne by each branch of the 
service and class of traffic, are under most circumstances the 
vital elements in rate making. While we have not fully inquired 
into these elements for each of the states mentioned, we have 
carried on comprehensive investigations with respect to them, 
not only for this state, but for the entire lines of the carriers 
involved when taken as a whole. To give in detail here the re- 
sults of these inquiries is, of course, out of the question. But 
without going into such details, it can be definitely stated that 
the present fourth class rates in this state are ample for the 
traffic in question in the instant case. In fact, we feel certain 
that these rates are as high as any that under the cirtumstances 
can properly be levied on traffic of this kind. 

The facts thus presented and analyzed have led us to the 
conclusion that the rates for petroleum products in this state 
should not exceed the rates which are now the rates of charge for 
articles that come in class four of the western classification. If 
because of other proceedings it should become necessary to in 
some way readjust class four rates, then the questions involved 
in these proceedings will receive further consideration. 

It is Therefore Ordered, That the respondent railway com- 
panies herein discontinue their present classification and rates 
on petroleum and its products, and that in lieu thereof these 
articles be placed in class four of the classification and trans- 
ported at rates which apply to fourth class freight. 



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Sm SAOjBOAD OOBiKIBSiON QF WIBOOKSIV. 



IN RE APPLICATION OF THB 1>URAND LIGHT AND POWER COM- 
PANY FOR AUTHORITY TO INl?RBASB RATES. 



Submitted Oct. 28, 1910. Decided Felf. S, 1911. 



Ajyplicaat desires to change iU rateg for metered eleictric teryice from 
a straight ciiarge of 6 cts. per kw. hr. to the readiness-to- 
serre method, charging 15 cts. per month per active unit, pins 
4 cts. per kw. hr. for current consumed; oocaslosal users to 
pay a straight rate of 12 cts. per kw. hr. The applicant fur- 
nishes electric current from a hydraulic plant located at E3au 
Oalle, seven miles from Durand, for street and eommerdai 
lighting in Durand^ and also furnishes a small amount of 
service at the villages of Eau Galle and Arkansas; it further 
delivers current to two feed mills, each oC which is equipped 
with a 40 h. p. motor. The value of the plant is estimated at 
140,000. The revenues and expenses of the plant are analyzed 
and apportioned to the various departments. The opeimtiiig 
expenses are compared with a number of hTdraulically eter- 
ated plants, comparable in size witfi that in question. 

Held: That the present rate schedule of the applicant Is iaeqai table 
and applicant is authorized to put into effect the rates prayed 
for, with certain minor modification^ as mentioned in the de- 
cision. 

The applicant, the Ehirand Light & Power Company, is a cor- 
poration engaged in the business of supplying electric current 
for lighting and power purposes in the city of Durand, Wis. It 
states in its application that its present rate for nietered serv- 
ices is 6 cts. per kw. hr., with a minimum charge of 75 cts. per 
consumer per month. For the reason that this rate does not 
furnish sufficient revenue to keep the plant and distribution sys- 
tem in efficient conditicm, the applicant requests permission to 
put the following schedule of meter rates into effect : 

Business houses: 15 cts. per month per active unit (consist- 
ing of 50-watt carbon or 40-watt mazda lamp), plus 4 cts. per 
kw. hr. for current consumed. For occasional users, 12 cts. per 
kw. hr. Minimum monthly charge 75 cts. 

Residences, churches and luxUs: 15 cts. per month per unit 
for 65 per cent of the active units, plus 4 cts. per kw. hr. for 
current consumed. 

At the hearing of the matter, which was held at the office of 
the Commission Oct. 28, 1910, the applicant company was rep- 



Digitized by VjOOQIC 



In re appl. dubakd ijt. a p. go. 386 

resented by its secretary, H. A, Miles, There was no appear- 
ance in opposition to the application. 

It appears from the testimony that the applicant company 
furnishes electric current from a hydraulic plant located at Eiiu 
Galle, Wis., seven miles from Durand, for street and commer- 
cial lighting at Durand, in addition to a small amount of service 
furnished at the villages of Eau Galle and Arkansas. The com- 
pany has no auxiliary steam plant, but is able to obtain sufficient 
power from its hydraulic plant for continuous operation, day 
and night, throughout the year. The connected load of the jJant 
is, for lighting, about 3,500 fifty-watt lamps, and for power 931/^ 
horse power; the peak load, for two and a half to three hours 
per day, is 160 kws. Of the 255 consumers about 25 per cent 
have meters, most of these being business places, which are open 
every evening ; and it is the claim of the applicant that these con- 
sumers, under the meter rate, are paying from 75 to 80 per cent 
less than they formerly paid under flat rates. At such times 
as the Christmas season and fair week, when these business 
consumers use their equipment to its fullest capacity, the company 
must stand ready to furnish all the current they need, while dur- 
ing the rest of the year a large part of the equipment brings 
the company no revenue. Under these conditions, although the 
company is able to show some net profift at the end of the year, 
such profit allows nothing for depreciation and is claimed by 
the applicant to be inadequate as a return upon the $55,000 in- 
vested in the plant. 

The application of the company covers only meter rates; as 
to the flat rates no change is desired. The city street lighting 
is done under a three year contract, which includes free lights for 
the city hall and for a bridge owned by the city. The streets 
are lighted by sixty-three 32-candle-power and ten 60-candle- 
power incandescent lamps, for which the city pays, respectively, 
$1.00 and $1.50 per month. 

The proposed rates of 12 cts. per kw. hr., mentioned in the 
application as applying to occasional users, is intended to cover 
the case of a public hall, which is used irregularly for dances 
and entertainments. The company desires to exempt the hall 
from the readiness-to-serve charge of 15 cts. per lamp per 
month, and instead, to charge those who use the hall the higher 
rate of 12 cts. per kw. hr. for the current actually used. 



Digitized by VjOOQIC 



336 BAU.ROAD COMMISSION OP WISCONSIN. 



Cost op Service. 

In determining the reasonableness of the proposed change in 
rates, it will be necessary to arrive at the cost of the service ren- 
dered' by the applicant company, and for this purpose the ex- 
penses of the plant must be considered in some detail. As these 
expenses, properly considered, will include a return for depre- 
ciation and interest upon the value of the property devoted to the 
service, it becomes necessary ito fix an approximate valuation 
upon the plant. No physical valuation of the plant has been 
made, but the company, in its annual report for the year ending' 
June 30, 1910, reports the investment in physical property as 
$41,966.84. 

Value op Piiysic.Mv Property. 

Other reports on file show that besides the two electrically 
operated mills, owned by officers of the company, there is a third 
mill located at the hydraulic plant and that this latter mill is 
driven by the same water wheels as the plant itself. This being 
the case, some portion of the value of land, buildings and hy- 
draulic power equipment, or of the plant expenses, is properly 
chargeable to milling purposes. Whether or not a reasonable 
d-ivision, or any division, of these values or expenses has been 
made, is not shown by the company's statement of investment 
and income, nor is there anything contained therein which is 
sufficient as a basis for such division. Until these facts are defi- 
nitely known, the use of the reported book value for rate mak- 
ing may be open to criticism. It is probable that the sum of 
$40,000 is a fair figure for the cost of the entire plant, and this 
amount will be used as the basis for the interest and deprecia- 
tion charges to be included in the annual expense. 

The applicant company reports its revenues and expenses of 
operation for the years ending June 30, 1909, and June 30, 1910, 
as shown in table I. No depreciation or interest charges are 
included in the expenses as reported by the company, and there- 
fore in order to make the figures a correct basis of rates, a de- 
preciation charge of 4.5 per cent on the cost value of the prop- 
erty is added, and the remaining net profits, amounting to about 
7 per cent in 1910 and about 6 per cent in 1909 upon the value 
of the property, are considered as devoted to interest. 



Digitized by VjOOQ IC 



In re appl. durand lt. a p. co. 



3J7 



TABLE I. 

REVENUES AND EXPENSES 

Of Duband EiiBOTBio Plant. 

Years Ending June 90, 1909, and June 90, 1910. 





1910 


1900 


OPERATING REYENCTE. 

Commercial liffhUnir eariiinffs 

Municipal ooatract lifirhtlni; earnings 


16.200.57 

819.25 

968.04 

17.75 


$5,826.23 
531 50 


Oommercial power earnings 


1,012.88 


Miscellaneous earnings 


1 50 






Total operating revenues. 


tS, 025.61 


$7,372 H 






OPERATING EXPENSES. 

Generation : 
Power plant operating labor 


1612.75 

24.86 

682.09 

98.72 


$1,048 25 


Mlso. power plant operating expense 


81.00 


Maintenance hydraulic power works 


542.15 


Maintenance power plant equipment 


78 03 


Malnt. power Plant bidcrs.. fixtures and irrounds. . 


28 45 








Total generation 


tl. 418.42 


$1,777.88 


Transmission : 
Maintenance transmission svstem 




$12 60 








Total transmission 




$12.60 








Distribution: 
Maintenance distribution system 


166.87 
4.52 


$42.40 


Maintenance metera 








Total distribution 


161.39 


$42.40 






Consumption: 
Munic. contract incandescent lamp renewals 


1114.76 




Maintenance municipal contract lamps 


$48 60 








Total consumption 


tl]4.76 


$43 60 






General: 
General ofHce salaries 


11,200.00 
285.72 


$896 60 


General ofHce supplies and expenses 


37.50 


Law exoenses . . 


20 75 


Miscel laneous general expense-s r -....- r , r . r .... . 


228.78 


396.32 






Total general 


11,714.50 


$1,353.17 






Insurance 


1133.75 


$133.75 






Taxes 


•297.82 

63.740.64 
1.431.00 
2,853.97 

18,025.61 


$258.62 


Total operating expenses as reported 


$3,622.02 


Depreciation. 4.5 per cent on $40,000 


1,431.00 


Remainder for interest 


2,319.09 






Total expenses 


$7,372.11 







22— R. D. 



Digitized by VjOOQIC 



RAJUiOAI) OOHMISaiOir OF maooHBts, 



The secretary of the applicant company directs particular 
attention to the faict that he and his brother do without charge 
a great deal of work for the company, such as office work, wir- 
ing premises, reading meters, collecting bills, repairing machin- 
ery, etc., and that for this reason the cost of oi)eration is ab- 
normally low. Moreover, the officers of the company are also 
th€ proprietors of two feed mills, and it appears that a consid- 
erable part of the labor cost normally chargeable to the electric 
plant is borne by the mills. For the purpose of ascertaining 
whether the operating expenses of the Durand plant are ab- 
normally low, as claimed, statistics of operating costs for a xmm- 
ber of hydraulically operated plants, comparable in size with that 
in question, have been compiled and are presented in table II. 
The expenses given in the table exclude taxes, depreciation, and 
interest. 

TABLE U. 

EXPENSES OF SEVENTEEN H YDKA.ULIC PLANTS HAVING lOQ TO tfO OON- 

8UMERS. 
Aa Reported for the Tear EndiJig June 30, 1909. 



City. 


Popu- 
lation 
1905. 


C!omm«r- 

cial 
consumers 


Capacity 


Conn. 
lOftdkws. 


Total opera- 
ting expenses 

exolodlof 
taxes ana oe- 


Black River Falls 

Bloomer 


1.946 
1,046 
730 
4.523 
2.416 

3,220 
3,449 
1,450 
1,090 
2,539 

1,425 
3,410 
2,300 
3,807 
4,244 

2,626 
2,362 


213 

107 
121 
450 
295 

404 

366 
110 
158 
205 

146 
409 
367 
334 
361 

203 
161 

213 
259 
107 
450 

250 
243 


95 
45 
60 
200 

180 

300 
380 
110 
120 
al2 

60 
320 
275 
335 
290 

325 
120 

200 
219 
45 
512 

350 
350 


150 

50 

57 

732 

219 

378 
720 
47 
100 
280 

90 


12,068 05 
940 00 


Chetek 


2,2S8 84 


De Pere 


6.M9 15 


Ed^rerton 


7,812 87 


Hadflon 


11,072 08 


Lake Geneva 


17,674 41 


Mondovi 

MoDtello 


2.092 01 
8.7B0 32 


Peshtififo 


5,458 79 


Prince ton 


2,523 U 


Rice Lake 


2,816 06 


River Falls 


349 
337 
360 


3,512 09 


Sparta. 


9,991 37 


Stouffhton 


7,779 72 


TcMnahAwk 


5,027 60 


West Bend 


200 

150 
271 

7^ 

232 
250 


12,240 67 


Median 


5,027 60 


A vera^ 


2,505 

730 

4,523 

1,359 
1,359 


6,101 24 


Minimum 


«49O0 


M^^x'mflm ,r . . 


17,«74 41 


riflran'^, 1910 


3,442 82 


Durand, 1908 


.3,363 40 







To obviate the effect of certain plants in the table whose 
expenses appear to be abnormally high, the median of the ex- 



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In re j^tiM, DUftA^ro ur. 4; f. co. 389 

pefises, or the figure above and below wbkh there are an equal 
number of plaats, has beeo fouad. This figure, $5,027.60^ al* 
though ooosiderably lower than the average f^re, is stiU almost 
$1,600 above the expenses as reported by the applicant company 
for 1910. 

It wiU be observed from the table that, while the population 
of Duraod -is only about half of the average of the ckies con- 
sidered, the generating capacity is considerably greater than the 
average, wfakh statement alone would lead us to believe that in 
one case the operating expenses of the applicant company should 
be greater, and in the other less than they actually are. For 
the purpose of a further analysis, the operating expenses of all 
utilities considered in the table have been reduced to averages 
based upon population, commercial consumers, generating capa- 
city and connected load. These averages are found to be $2.42 
per inhabitant; $23.62 per consumer; 27.89 per kw. generating 
capacity; and $23.61 per kw. connected load. The respective 
values of operating expenses for Durand, as based upon these 
unit expenses, are $3,288.78, $5,905.00, $9,761.50, and $5,477.52, 
from which it may be observed that, when considering popula- 
tion, a value is determined which does not materially differ from 
that which actually existed. The value of $9,761.50, as deter- 
mined from the average based on generating capacity, greatly 
exceeds the actual operating expenses- The former amount, 
$9,761.50, must be considered as abnormally high, in view of the 
fact that the company's generating capacity, upon which this 
figure is based, is more than twice as great as its maximum de- 
mand. The amounts based upon the number of consumers and 
generating capacity agree with each other reasonably well and 
are probably as reliable as any estimates which can be deduced 
from the available data. However, they are probably somewhat 
in excess of normal operating expenses for a city the size of 
Ihirand, as the number of inhabitants per consumer is consider- 
ably less than the average for the cities under consideration. 

As has been pomted out many times before, the total expenses 
of an electric plant are not in all cases directly proportional to 
the output of the plant. Certain expenses are entirely inde- 
pendent of the amount of current sold, and a sound theory of 
rate making requires that these latter expenses, know as capa- 
city expenses, should be paid by the consumers, not in proportion 
to the current used by them, but in proportion to the maximum 



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340 RAILROAD COMMISSION OP WISCONSIN. 

demand which each consumer makes upon the capacity of the 
plant. The expenses which vary with the amount of current 
sold, on the other hand, or the output expenses, are properly met 
by a rate which makes the consumer's bill vary directly with the 
amount of current he uses. These principles are recognized by 
the applicant in the rate schedule which it seeks to put into 
effect, for it provides a "readiness-to-serve" charge, based upon 
the amount of the consumer's installation, plus a current charge 
for current actually used. It remains to be seen whether the 
rates proposed by the applicant are fixed at figures which meas- 
ure up properly to these principles. 

An apportionment of the operating expenses of the applicant 
for the year ending June 30, 1910, has been made between capa- 
city and output expenses, as shown in table III: 

TABLE III. 



Total operating expenses. 


Capacity expenses. 


Output expenses. 


$8.025 61 
100% 


$4.284 07 

47.48% 


$3.740 64 
62.52% 



The current produced by the plant at Durand is used for three 
distinct purposes: commercial lighting, street lighting, and 
power. The situation at Durand in this respect is somewhat 
peculiar, by reason of the fact that the plant carries an unusu- 
ally high power load, dbe to the operation of two feed mills, each 
of which is equipped with a 40-hors€-power motor. Since the 
power consumption is so large a part of the current consumed by 
patrons of the applicant company, it is necessary to divide the 
capacity and output costs, as found above, among the three sys- 
tems, in order that the conditions in one department may not 
affect the unit costs determined for another. 

In the distribution of capacity expenses between the differ- 
emt systems, it is evident that, since the total capacity cost Is 
proportional to the demand made upon the plant, the division of 
that capacity cost between the systems should bear some relation 
also to the demand made by each system. The capacity expense 
is the expense due to the necessity of having a plant of sufficient 
capacity to meet the maximum demand of each system upon 
the plant at any time, and therefore the maximum demand of each 
system would seem to be ithe correct basis upon which to appor- 



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In re appl. durand lt. a p. co. 341 

tion the capacity expenses. As nearly as it can be determined 
from the figures submitted by the applicant, the maximum de- 
mands chargeable to the various systems are about as follows : 





Amt. kws. 


Percent. 


Commercial lie htimr 


91.2 

3.3 

65.5 


57 00 


Street llffhtlnff 


2.06 


Commerciakl power 


40 94 






Total 


160.0 


100 00 







The output expenses, on the other hand, depend directly upon 
the amoimt of current sold, and therefore the division of such 
expenses, as between the systems, is properly made upon the 
basis of current used by each system. The applicant company 
reports the amount of current sold upon a meter basis, but as 
by far the largest part of the current is sold upon a flat rate, 
and no records have been submitted showing the amount so dis- 
posed of, it is necessary to estimate the total kilowatt hours of 
output chargeable to each system. 

The output chargeable to street lighting may be ascertained 
with a fair degree of certainty, by reason of the fact that the 
entire installation of street lights is operated at the same lime 
and for a more or less definite number of hours each year. The 
company reports that the street lights are operated upon an all- 
night-every-night basis, and the normal number of hours of use 
upon that basis has been found to be about 4,000. Since the lamns 
used are 32 and 60-candle-power Tungstens, and the nominal 
wattage rating of such lamps is known, the total consumption of 
the street lighting system per year is found to be about 13,080 
kw. hrs. 

In the case of power consumption, also, sufficient data are at 
hand to form a comparatively accurate estimate of the amount 
of current used. Four of the six consumers are upon meters, 
and their consumption is reported as 1,428 kw. hrs. per year. 
The remaining two consumers are the mills already mentioned, and 
the company states in a letter to the Commission that these mills 
operate under electric power from six to seven hours every day. 
Knowing the kilowatt capacity of each of the motors and the 
number of hours of use per year, we find that the total con- 
sumption of these two users would be about 126,750 kw. hrs. 



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542 



RAILROAD COMMISSION OF WISCONSIN. 



per year, were full load used during the entire period of opera- 
tion. As an estimate it is fair to assume that the average load 
upon motors used for milling purposes is about half of the motor 
rating. Upon this basis our estimate of the annual kw. hrs. 
consumed by the two mills is about 63,375. This aittotmt, added 
to the consumption of the metered power users, makes the total 
power consumption 64,803 kw. hrs. 

With respect to commercial lighting consumption, 'the only 
facts reported from which an estimate of consumption is prac- 
ticable, relate to connected* load of all consumers and the amount 
of current consumed by meter consumers, which latter is re- 
ported to be 16,774 kw. hrs. With this information at hand, 
there are at least two methods available for the approximate de- 
termination of the amount of current consumed. 

Method 1. 

The company reports the total connected load of each class 
of consumers, and this information, tc^ether with statistics as 
to the average daily hours of use by each class of consumers, 
makes it possible to coniptrte the kilowatt hours of consumption 
daily and yearly by the total number of consumers, as shown in 
taHe IV. The figures for average hours of daily use of entire 
installation, as used in this table, arc the same as used In re Ap- 
plication Cumberland Municipal Electric Li^ht Plant, 4 W. R. C. 
R. 214, 222, and represent the most reliable data at hand at the 
present time: 

TABLE IV. 

KSTTMATE OF ANNUAL COMMERCIAL LIGHTING CONSUMPTION. 

Metlwd 1, 



Class of 
cooKumers. 


Av. In- 
stallation 
kws. 


Av. hrs. 
daily use 
of entire 
installa- 
tion. 


Kw.hrs. 
consumed 

dally, 1 
consumer. 


Kw.brs. 
consumed 

yearly, 1 
consumer. 


No. Of con- 
sumers. 


Total con- 
sumption 

iB kw. hrs. 
per year. 


Residences 

Saloons 


.53 
.66 
.30 

.91 

.50 

1.80 

.70 

1.80 

1.50 

.85 

.45 

.18 

.84 


:40 
3:45 


.366 
2 4.% 


130 

889 
730 

506 

ao4 

1.314 
767 
876 
256 
217 
63 
120 
307 


106 
12 

1 

2 


21,960 

10,666 




1:00 1 .200 

1:50 ' 1.665 

1:40 .883 

2:00 1 3.600 

3:00 2.100 

1:10 2.400 

:28 1 .700 

:42 .595 

:23 1 .173 

1:50 .330 

1:00 .840 


,MK 


Stores 


Livery stables.... 
Hotels 


6.570 


Bestaurants 

Theaters 


2,3D1 

876 


Churches 


i.sai 
i,3osr 

126 


Lodfire halls 

Schools 


Shops 


810 


Print shoi» 


61i 










63,389 



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In re aj^pl. durand w. & p. co. 



S43 



Method 2. 

The second method of estimating total output is illustrated 
in table V. Knowing the average consumption of each metered 
consumer, and assuming that each unmetered consumer uses the 
same average amount of current^ it is possible to arrive at some 
approximation of the total for all the consumers of the plant. 

f ABLIt V. 

ESTIMATE OF ANNUAL. COMMERCIAL LIGHTING GONStJMPTION. 

Method 2. 





Nttittber. 


Total 

Oonsumptton. 

Kw. hrs. 


CoAAumiyUOD 

OOP oontfumef . 

Kw. hi*. 


Metered oonsumers 


84 
198 


16,774 
91.800 

48,874 


800 


Unmetered oonsumers 


aoo 


Total 











Between the figures found under Method 1, or 63,389 kw. hrs., 
and that found under Method 2, or 48,374 kw. hrs., there is a con- 
siderable variation. The method under which the latter figure 
is found takes into consideration conditions existing at Durand, 
and therefore its results are probably more reliaWe, if some al- 
lowance IS made for the fact that unmetered consumers are likely 
to use their current for longer hours than metered consumers. 
On the whole, it woukl seem that a consimii>tion of 52,000 kw. 
hrs. on the part of commercial lighting customers would be a 
fairly accurate estimate, 

"We thus have arrived at the total annual consumption at the 
Durand plant as folfows: 





Amount, 
kw. hrH. 


Per cent. 


Comifierclftl ll^htliMr 


5«.00O 
13,080 
64,803 


• 40.M 


Street lighting 


10.07 


Gotnttierclal power 


48.89 


Total 


m,m 


100.00 







Dividing the capacity expenses among the three systems in 
proportion to the estimated maximum demand of each, and the 
output expenses in proportion of the estimated output of each, 
the expenses chargeable to each system are determined as shown 
Ift table VI : 



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344 



RAILROAD COMMISSION OP WISCONSIN. 



TABLE VI. 
DIVISION OF CAPACITY AND OUTPUT EXPENSES. 





Capacity. 


Output. 






Amount. 


Per cent. 


Amount. 


Percent. 


Total. 


Commercial liffhtlnff 


12,442 43 

88 27 

1,754 27 


57.00 

2.06 

40.94 


$1,497 75 

376 68 

1,866 21 


40.0( 
10.07 
49.89 


13,940.18 


Street lUfhtlng 


464.95 


Commercial ix>wer 


3,690.48 




14,284 97 


100.00 


13,740 64 


100.00 


18.025 61 



The foregoing table shows that of the total expenses of the 
plant, $2,442.43 are chargeable to capacity cost of the commer- 
cial lighting system, and $1,497.75 to the output cost of the sys- 
tem. The rate which the applicant company seeks to put into 
effect would make a fixed charge per active lamp to cover capa- 
city cost, and a fixed charge per kilowatt hour sold to cover out- 
put cost. Since the capacity cost of the commercial system has 
been determined, the fixed cost to the company per active lamp 
may be found \}y dividing the capacity cost by the number of 
active lamps. The number of lamps which are to be considered 
active varies greatly with conditions. In a letter sent to the 
Commission subsequent to the filing of the application in this 
case, the applicant company states that under its proposed sched- 
ule it wishes to consider not less than 65 per cent of business 
lights and not less than 35 per- cent of residence lights active. 
From this letter it would seem that the company intends to take 
as the active load that actually found to exist by an investiga- 
tion of its consumers' installations, using the figures mentioned 
as a minimum in each class. For the purposes of this case, how- 
ever, in the absence of such data as would show the actual part 
of each consumer's load which is active, it may not be far wrong 
to assume that 60 per cent of the business installations and 35 
per cent of the residence installations are active. Since the total 
residence installation is reported as 97.66 kw. hrs., and each 16 
candle power carbon filament lamp has a rated wut'age of 50 
watts, the total number of lamps used in residences appears to 
be about 1,953, and the active load, on the assumption of 35 per 
cent active, will be in the neighborhood of 684 lamps. Upon 
the same basis, since the connected business load is known to be 
63.37 kws., the total number of lamps is about 1,267, and the 
active load, assumed to be 60 per cent of the total load, is 760. 



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ti* rv AprU, WHAtiP l/t, # t*, oo. 



346 



Dividing the capacity cost of $2,442.43 by the total number of 
active lamps, we find the capacity cost per lamp per year to be 
about $1.6y, and per month 14.1 cts. 

To determine the output cost per kilowatt hour of the com- 
mercial lighting system, it is necessary to divide the output ex- 
penses oi that system, or $1,497.75, by the total number of kilo- 
watt hours chargeable to it, or 52,000 kw. hrs. The resulting 
figure, 2.88 cts., is the cost to the company of furnishing each , 
kilowatt hour of current to its residence and business consumers. 

It would seem, therefore, that in order to just cover the op- 
erating expenses of the plant, the rates to be put into effect by 
the applicant* company would have to be a readiness-to-serve 
charge of about 14 cts. per active lamp, plus a current charge 
ot about 3 cts. per kilowatt hour for current actually used. 

We may arrive at the cost of commercial lighting service in 
another way, by taking the number of kilowatt hours sold as the 
basis lor determining both capacity and output costs. Since the 
connected lighting load is 160 kws., and the active load is about 
72 kws., the capacity cost per kilowatt of active load is $33.92 
per year. This total cost remains fixed, regardless of the hours 
of use, and therefore the cost per hour will decrease as the num- 
ber of hours of use increases. Thus, for example, to arrive at 
the capacity cost for one hour's use per day of the active load, we 
must divide $33.92 by 365 ; for two hours' use by 730 ; for three 
hours* use by 1,095. The output cost, as has been shown, is 
about 2.88 cts. per kilowatt hour, and this cost is the same per 
kilowatt hour of use, no matter how many hours the installation 
is used. Thus, by combining the capacity cost as it varies for 
different lengths of use, and the uniform output cost, we arrive 
at the following table of costs per kilowatt hour: 





Capacity 
(cts.) 


Output 
(cts.) 


ToUl 

(CUS.) 


1 hour daily use 


9.32 
AM 
3.11 
1.8« 
.03 


2.88 

2.88 
2.88 
2.88 
2.88 


12.20 


Shoundally use 


7.54 


3 hours daily use 


5.99 


5 hours dally use 


4.74 


10 hours dally use 


8.81 







The above figures illustrate the decreasing cost of service 
to the company as the hours of use increase, and indicate that a 
rate of about 12.2 cts. per kw. hr. for the first 30 hours' use 



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346 



BAX£iBOAI> COMMIBRION OF WISCONSIN. 



per month of active connected load, about 6.8 cts. for the next 
60 hours, and about 4.5 cts. for all use above ninety hours per 
month would about cover both capacity and output expenses. 

As has been indicated, the Durand electric system is peculiar 
in its large consumption of power. At the same time, the rev- 
enue derived from power users is comparatively small, because 
of the fact that the two largest power users have a very low 
contract rate. The report of the applicant shows that such con- 
sumers contributed $916.64 to its revenue during the past year; 
and using the figure of 63,375 kw. hrs. as the amount of current 
consumed by them alone, we find that to these two consumers the 
contract price of power service amounted during the past year 
to about 1.45 cts. per kw. hr. Taking the capacity and output 
costs of power service as shown in table VI, and determining the 
cost per kilowatt hour by the method just used in the case of 
commercial lighting, we arrive at the following table of total 
cost of power service: 





Capacity 
(ct«.) 


Output 
(cto,) 


ToUl 
(cts.) 


1 hour daily use 


1:3 

l.OK 
.85 
.78 
.51 


1.88 
2.88 
2.18 
2.88 
2.88 
2.88 
1.88 
2.88 


7.96 


2 hours daily use 


5.42 


3 hours dally utie 


4.57 


4 hoiirfi dal y use 


4.40 


5 hours dal y use , 


890 


• hours daily use 


3.78 


7 hours dally uae* 


8.61 


10 hours dally use 


3.30 







This table shows that for six or seven hours per day, which 
IS the length of use which the applicant reports for its two 
large power consumers, the total cost of service to the applicant 
is about 3.7 cts. per kw. hr., or about three times the revenue 
received from such service. 

The Peoposed Rates. 

The commercial lighting meter rates pr(^)osed by the appli- 
cant comprise a readincss-to-serve charge of 15 cts. per active 
unit, and a current charge of 4 cts. per kw. hr. The application 
differentiates between residence and business consumers by pro- 
viding that only 65 per cent of the active load of residence con- 
sumers shall be subject to the readiness-to-serve rate. The the- 
ory upon which this differentiation is made, appears to be that 



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In re appl. durand lt. a p. oo. 



347 



the residence consumer generally uses only a part of his installa- 
ton at one time, while the business consumer ordinarily uses 
the whole or the greater part of the installation at once. This 
variation between residence and business consumers is, however, 
taken care of by assuming the average active load itself to be 
60 per cent for business consumers and 35 per cent for residence 
consumers, and there seems to be no ground for any further 
reduction in favor of residence consumers. 

Taking the ra*es applied for as being 15 cts. per active lamp 
per month, plus 4 cts. per kw. hr. consumed, the effect of the 
adoption of such rates upon the bills of present consumers is next 
to be noted. The evident intention of the applicant in applying 
for these rates is to make its meter schedule not only more scien- 
tific in itself, but more just as compared with the flat rate sched- 
ule. The following table compares the bills for ^ typical resi- 
dence and a typical business installation under the present meter 
rates, the proposed meter rates, and the present flat rates : 

TABLE VII. 

OOMPARISONfl OP MONTHLY BILLS UNDER PRESENT AND PROPOSED 

BATES. 

r. Regidmce, ImUOUUIon, W UghJU, Conneeied load, k hilowUt, Aetiv load, 36% or 

S.6 lighU. 



Hours use per 
dajr of full con- 
nected load. 


Kw. hrs. 

per 
month. 


Present 
mater 
rate. 


Proposed meter rate. 


Present 
flat rate. 


1 


ao 

45 

eo 


10 90 

im 

2 70 

3 60 


10.53 plus 10.00, or 11.13 
.53 Plus l.ao.or 1.73 
.53 plus 1.80, or 2.33 
.53 plus 2.40, or 2.03 


SI. 50 


2 


1.50 


3 


1.50 


i 


1.50 







il. ButineM. 



InstdOatUm, 15 lights. Connected load, i kilowatta. 
9Uaht8. 



Active loadt 60% or 



day of full con- 
nected load. 


Kw. hra. 

per 
month. 


Present 

meter 
rate. 


Proposed meter rate. 


Present 
flat rate. 


1 


22.5 
45 

fl7.» 
90 
112.5 


9135 
2 70 
405 
540 
6 75 


11.85 plus 10.90, or 12.25 
1.35 plus 1.80, or 3.15 
1.35 plus 2.70. or 4.05 
1.35 plus 3.60, or 4.96 
1.35 plus 4.50, or 5.85 


•4.50 


2 


4.50 


3 


4.50 


4 

5 


4.50 
4.50 







Digitized by VjOOQIC 



348 RAILROAD COMMISSION OF WISCONSIN. 

The above table indicates that in the case of a typical resi- 
dence, the proposed rates, would amount to a slight increase 
over the present meter rates for one-hour-a-dajr users^ but would 
be a reduction for users whose daily consumption is two hours or 
ever, while the proposed rates would be higher than the present 
flat rates in the case of all but the one hour consumers. In the 
case of a typical business house, the proposed rates would be an 
increase over the present meter rates for consumers up to three 
hours a day, and for consumers above that point there would be 
a reduction from present rates, the difference grooving larger 
with the increase in hours of use. The proposed nates are ap- 
parently lower than the flat business rate for consumption up to 
about Sy2 hours per day, and above that point would result in an 
increase. 

It is evident, therefore, that the effect which the proposed 
rates would have upon the bills of consumers on Ehirand depends 
upon the number of hours of use by such consumers. The dif- 
ference in the case of residences will not be great, except for con- 
sumers who use their installation something less than one hour 
daily ; but in the case of business consumers, if the average use 
of installation is less than three hours per day, the- new meter 
rate would amount to a more or less heavy increase. On the 
other hand, except for business consumers who use their installa- 
tion for a comparatively long time daily, the new rates would not 
be as high as the present business flat rates. It is to be noted 
that, although the flat rate in effect is apparently considerably 
higher than the meter rates for all except long hour consiuners, 
there is no doubt that flat rate consumers are somewhat more ex- 
pensive to the plant than metered consumers, for the reason that 
in many cases flat rate consumers will leave their lights on all 
night, or, at least, will use very much more current than they 
would use if they were upon meters. From the data at hand, 
this extra expense to the plant cannot very well be estimated, 
but the fact that it exists should be borne in mind in comparing 
flat and meter rates. 

The probable revenue of the plant under the proposed rates 
has been computed as shown in table VIII, based upon the con- 
sumption and the installation for the year ending June 30, 1910: 



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In re appl. durand lt. a p. co. 349 



TABLE VIII. 

Residence load, metered* 36 . 52 kws. 

Active load, 35% 12 . 78 " or 256 lamps. 

Business load» metered 21.38 " 

Active load, 60% 12. 8a " or 257 lamps. 

Total active lamps 513 

513 lamps at 15 cts. each = $76.95, readiness-to-serve revenue 

per month, or, per year f 923 .40 

Current consumed by metered consumers, 16,774 kw. hrs. 

at 4 cts 670.96 

Plat rate revenue, same as year 1909-10 5,194.13 



Total commercial earnings under proposed rates $6,788.49 

Actual commercial earnings, year 1909-10 6,200.57 



Probable increase in revenue |587 . 92 

* Residence classification includes churches and halls, as per pro- 
posed rates filed. 

This table shows that on the basis of past consumption anvi 
installation the proposed rates woiildi increase the total earnings 
of the plant by about $587.92. The expenses remaining the 
same, such an increase would amount to an additional net return 
of about 1.5 per cent upon the value of the applicant's property. 
As the present net return has been stated to be about 7 per cent, 
it would seem that the effect of the proposed rates would be a 
total return to the company of about 8.5 per cent upon the money 
invested in its plant. 

If the readiness-to-serve rate were fixed at 12 cts. instead )f 
15 cts., the total probable earnings would be about $6,603.8^1, 
or an increase of $403.24 over present earnings. Or, if the rate 
for current consumed were fixed at 3 cts. instead of 4 cts., and 
the readiness-to-serve rate were left at 15 cts., the probable earn- 
ings would be about $6,620.75, or an increase over present earn- 
ings of $420.18. The establishment of the readiness-to-serve 
rate at 12 cts., and the rate for current consumed at 3 cts., 
would result in a total probable revenue of $6,436.07, or an in- 
crease over present revenue of $235.50. With the readiness-to- 
serve rate of 14 cts., and the rate for current consumed at 3 cts., 
the total probable coonnercial revenue would be $6,558.19, or an 
increase over present revenue of $358.10. 

The effect of these latter rates upon the typical residence and 
business installations referred to in table VII, is shown in 
table IX: 



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350 



BAILBOAD COMMISSION OP WISCONSIN. 



TABLE IX. 

C0MPARI80N OF MONTHLY BILLS. 
Under Pbbsbiit Batb amd Ratb of 14 Osittb fob RBADiirvs»jro-8«Rrx and 

3 Obntb Psb Kw. Hb. CoHsmneD. 
I Residence. IrutdUation 10 light*: eonneeted load i KHotDott: aeUve load 3S% or 

3.5ligU8. 



Hrs. use per 

day of full 

connected 

load. 


Kw. hrs. per 
month. 


Present meter 
rate. 


Present 'flat 
rate. 


and3ct8.perkw.hr. 


1 


15 
30 
46 

60 


10.00 
1.80 
X.70 
3.60 


91 50 
.1 50 
1 50 
1 60 


10 48 Dlus 10 45 or 10 03 


2 


48 90 " 1 38 


3 


48 ** 1 96 *' 1 SS 


4 


48 ** 1 90 ** 2 28 







11. BvMnet^. InatdUation 15 UghU; connected load \ kilowatt: active load eo<f> or 9 

lights. 



Hrs. use per 

day of full 

connected 

load. 


Kw. hrs. per 
month. • 


Present meter 
rate. 


Present flat 
rate. 


14 cent readiness-to-serve 
and 3 cts. per kw. hr. 


1 


22.5 
45 

67.6 
90 
112.5 


9135 
2.70 
4.06 
5.40 
6 75 


94 50 
450 
450 
4 50 
450 


11 26 dIus 10 68 or 11 94 


2 


1 26 1 35 " 2 61 


3 


1 26 *' 2 02 " 3 28 


4 


1 26 ** 2 70 ** 3 96 


5 


1 2B '* 3 38 " 4 64 







It is seen from this table that when the readiness-to-serve 
rate per active unit is 14 cts., per month and the rate per kw. 
hr. consumed is 3 cts. per month, the monthly bills in the case of 
a typical residence would be less than under the present meter 
rate, and that, for the first 21/^ hours use, will be less than under 
the present flat rate. In the case of the typioal business installa- 
tion, the monthly bills would be less after about the first two 
hours use of the active load than unider the present meter rate, 
and less than the present flat rate up to about the first five hours 
use. 

It has already been stated that the applicant company de- 
clares its operating expenses to be abnormally low, chiefly by rea- 
son of the fact that services, such as office work, wiring premises, 
reading meters, collecting bills, repairing machinety, etc., are 
rendered by the secretary and his brother without charge. The 
company's report of operating expenses shows that there is an 
item of $1,200 for general office salaries for the year ending June 
30, 1910. Since the secretary of the company performs all 



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In re appl. DUBAifD lt. a p. go. 951 

office work, it is probable that such services as "office work, read- 
ing meters, collecting bills, etc.," already referred to as rendered 
by the secretary without charge, may properly be covered by the 
amount charged to office salaries. The company has further 
stated that a considerable part of the labor cost normally charge- 
able to the electric plant is borne by the mills owned by certain 
officers of the company. When we consider the fact that the 
contract revenue from these mills, amounting to about $916, is 
about $2,000 less than the revenue which it appears should be 
fairly derived from this source, it is difficult to'agree that, in the 
absence of a definite record, an allowance should be made for 
miscellaneous operating expenses said to be borne by the mills 
but chargeable to the electric plant. Such further allowance to 
the operating expenses would be an additional expense to com- 
mercial lighting and metered? power consumers, but would in 
no wise affect the revenue derived from the contract power con- 
sumers already a burden to the plant. For these reasons it ap- 
pears that for the purpose of establishing rates applicable to the 
commercial lighting and metered power consumers, the use of the 
operating expenses, as reported, will be equitable. Upon this 
basis, while carrying the unprofitable power business and after 
making due allowance for depreciation, the plant is earning from 
6 to 7 per cent interest upon the value of the plant. 

Later information submitted by the petitioner in regard to 
its power consumption indicates that the time of consumption by 
the large unmetered power users is not, as previously reported, 
six to seven hours per day, but only about three hours per day. 
This correction will have the effect of reducing the estimated 
total power output from 63,375 kw. hrs., to 32,116 kw. hrs. The 
result of this change upon the division of output expenses among 
the commercial lighting, power, and street lighting systems will be 
to very materially decrease the proportion of the total output 
expense chargeable to power consumption, and correspondingly 
increase that chargeable to commercial lighting, with a slight in- 
crease in the street lighting proportion. The net result of these 
corrections is, that the output cost of the commercial lighting 
system is nearly one cent higher per kilowatt hour than the 
f5gure previously ascertained, or about 3.85 cts. instead of 2,88 
cts. Thus, a rate which would just cover the operating expenses 
of the plant would apparently consist of a readiness-to-serve 
charge of about 14 cts. per active lamp, as already determined, 



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352 RAILROAD 00MMI8SI0N OF WISCONSIN. 

plus a current charge of a little less than 4 cts. per kw. hr. 
tor current actually consumed. 

Applying corresponding corrections to the figures presented 
to show the unit cost of power service, we find that the two 
flat rate power consumers contributed about 2.89 cts. instead of 
1.45 cts. per kw. hr. to the revenue of the plant during the past 
year. Changing their output cost from 2.88 to 3.85 cts. per 
kw. hr., and leaving the capacity cost at its present figure, as 
it is not aflFected by the corrections, we arrive at the total cost 
to the company of power consumption for a three-hour user as 
a^bout 5.5 cts. per kw. hr. Thus, although under the flat rate the 
three-hour power user pays more per kilowatt hour than the 
seven-hour user, he costs the plant enough more than the seven- 
hour user to make his relative contribution to the plant's reven- 
ues less 'than that of the seven-hour user. The above figures 
show that the two large power consumers, on the basis of three 
hours' use of current a day, cost the plant nearly four times as 
much as they pay, while on the basis of seven-hour consump- 
tion it was found that the cost was three times the price paid. 

From the facts presented herein, it appears that the present 
rate schedule of the applicant is inequitable, and that the situa- 
tion, when taken as a whole, is such that it should be permitted 
to put into eflFect the following rates : 

For business houses: A charge of 15 cts. per month per active 
50-watt lamp or per 40-watt Mazda lamp, when the active load 
constitutes 60 per cent of the connected load, plus 4 cts. per 
kilowatt hour for the current or energy used. For occasional 
users, a rate of 12 cts. per kilowatt hour may be charged. 

For residences, churches and halls: A charge of 15 cts. per 
month per active unit or lamp, when 35 per cent of the con- 
nected load is considered active, plus 4 cts. per kilowatt hour 
for the current or energy' used. 

There may also be a minimum rate of 75 cts. per consumer per 
month. I I ! 



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CITY OF SHEBOYGAN V. SHEBOYGAN BY. A EL. CO. 353 



CITY OF SHEBOYQAN 

VS. 
SHE?B0Y6AN RAILWAY AND ELECTRIC COMPANY. 



aulmitted Oct. IB, 1910, Decided Feh. S, 1911. 



Peftition alleging that respondent furnished the street lighting for peti- 
tioner under a contract, from June 13, 1905, to Aug. 31, 1910, 
at the rate of $74 per lamp per year, all night service; that 
the respondent failed to furnish light of "full 2,000 candle 
power," as was provided in said contract; that since Sep. 2, 
1910, respondent has furnished such lighting (193 arc lights) 
without a contract; that the city is willing to pay a reason- 
able compensation for such service, but is unwilling to pay at 
the rate fixed in the expired contract. The Commission is re- 
quested to fix a reasonable rate for such service. After the 
filing of the petition the Commission, on its own motion, insti- 
tuted an investigation of the street lighting service in ques- 
tion. 

A valuation by the engineers of the Commission placed the value of 
respondent's plant new at $819,122, and at $656,042 present 
condition; of these sums there were allotted to the street 
lighting department $38,900, and $33,154, respectively. An 
analysis of the respondent's operating expenses shows that 
they amounted to $247,078.29 for the year ending June 30, 1910, 
of which sum $13,196.72, or 5.34 per cent, was apportioned to 
street lighting, making an average expense of $68.38 per year 
per lamp: herefrom 53 cts. should be deducted for the street 
lighting department's share In the non-operating revenues. 

It is not attempted to define the exact meaning of the term "full 2,000 
candle power," as uered in the expired contract between the 
parties, and the engineers' investigation of the service was 
principally Inaugurated to determine whether or not the lamps 
in use are such as to operate satisfactorily on a system of 
this kind, whether the street lighting system received proper 
care and attention, and, if this was not the case, what changes 
would be necessary to produce normal operating conditions. 

Held, as to the quality of service: that the shunt type arc lamp, such 
as is used by respondent, has certain inherent characteristics 
which causes it to be unsteady in its operation when used on 
circuits supplying a large number of arcs; that the respondent 
should provide Itself with such equipment and adopt such 
methods as to insure greater uniformity in the operation of 
the arc lamps in use; that at the time the tests were made the 
efficiency of the street lighting was several points below what 
may reasonably be regarded as^a normal condition under the 
circumstances. Respondent Is ordered to so imprt>ve the serv- 
ice as to render it reasonably adequate. 

Held, as to the rate to be exacted: That a rate of $68 per arc per 
year is reasonably adequate. 
23-R. D. 

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354 SAILBOAD OOUMOmOJH OF WISCONSIN. 

This matter involves the rate and quality of service for light- 
ing the street of Sheboygan by the Sheboygan Railway & Elec- 
tric Company, respondent. The petitioner, the city of Sheboy- 
gan, alleges in its complaint that the respondent, the Sheboygan 
Railway & Electric Company, is a public gervice corporation, 
engaged, among other things, in lighting the streets of the said 
city with electricity; that on or about July 25, 1905, the city of 
Sheboygan and the Sheboygan Light, Power & Railway Company, 
of which the respondent company is the »uccc»gor, entered into 
a written contract whereby the said company agreed to light 
the streets of the city of Sheboygan for a period of five years 
from June 19, 1905; that no contract now exists between the 
respondent company and the city of Sheboygan for lighting the 
streets of said city ; that during the term of the contract the city 
of Sheboygan carried out its part thereof, but that the respondent 
company failed to furnish light of as high a candle power as was 
providlcd for in the contract, and that it otherwise failed to give 
proper care and attention to its street lighting system ; that be- 
tween Aug. 81 and Sep. 2, 1910, the respondent company fur- 
nished no light in the streets of Sheboygan, and that since Sep. 
2, 1910, the respondent company has furnished light for which 
said city is willing to pay a reasonable compensation, but that 
the city is unwilling to pay therefor at the rate fixed in the 
expired contract. Wherefore, the city of Sheboygan prays for 
an order fixing a reasonable rate per street lamp per month to 
be paid by the said city to the said respondent company for such 
lighting. 

The city further prays for a permit or license to build and 
operate its own electric light plant and system for the purpose 
of lighting its own streets and municipal buildings in the city of 
Sheboygan. This prayer, however, was not followed up by 
testimony and arguments at the hearing that was held upon the 
petition, and is therefore omitted from consideration herein. 

Attached to the complaint is a copy of the contract therein 
referred to, which provides for 180 or more lamps, to burn each 
night from thirty minutes after sunset until thirty minutes be- 
fore sunrise, at a rate of $74 per lamp per annum, the con- 
tract to continue in force for five years from June 19, 1905. It 



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CITY OF SHEBOYGAN V. SHEBOTOAN BY. A EL. CO. S55 

appears in evidence that the number of lights actually furnished 
by the respondent company under the contract is 193. 

Upon the city filing the petition above described, this Com- 
mission in addition instituted, upon its own motion, an investi- 
gation into the street lighting service furnished by the respondent 
company. 

Hearings were held in both proceedings at the office of the 
Commission, Oct. 18, 1910. Henry Detling, city attorney, ap- 
peared for the petitioner; £. R, Bowler for the respondent. 

The petitioner introduced no testimony at the hearing, but ex- 
pressed a willingness to submit to the Commission the matter 
of the reasonableness of the rate to be paid, to be determined 
upon the facts and statistics which the Commission might obtain. 
A statement was introduced by the respondent showing the com- 
pany's estimate of the- value of the property devoted to the fur- 
nishing ^of the street lighting service, and of the annual expense 
chargeable thereto. From these estimates the company pointed 
out that the cost of lighting the streets of Sheboypan is much in 
excess of the revenue derived therefromi when this service is 
charged with its proportionate share of the expenses, but that the 
company is able to carry the street lighting business at this 
apparent loss by reason of the fact that a considerable portion of 
the fixed exi>enses, which have been charged to street lighting, 
would still continue should the company cease to furnish this 
service. ' • ' « -r-!_ 

Under normal conditions public utilities, for the services they 
render, are entitled to rates that will cover their operating ex- 
penses, including depreciation and reasonable returns for in- 
terest and profits on a fair valuation of the property actually 
used and useful in performing these services. From this it is 
clear that in order to fix a reasonable rate for the street lighting 
in Sheboygan, it is necessary to determine what is the fair value 
of the property devoted to the street lighting in question and 
what it costs the respondent to furnish the service. As the street 
lighting business in this case is carried on in connection with the 
commercial lighting and power business and the operation of a 
street electric railway in that city, it follows, as a matter of 
necessity, that the property used and the expenses incurred for 
the street lighting are so closely intermingled or connected with 
the property used and the expenses of the other parts of the 
business that it becomes a rather difficult matter to say just what 



Digitized by VjOOQIC 



356 



RAILBOAD OOMMISSION OF WISCONSIN. 



part of the common property and expenses should be charged or 
allotted to each of the three branches of the service. For it is 
well known that of all the property thus used, and that of all 
the expenses thus incurred, considerable proportions are com- 
mon to all branches of the service, and that only certain items in 
each case are of such nature that they can be directly allotted 
to one or the other of these branches. In order to find all the 
property and all the expenses for each branch, it has therefore 
been necessary to resort to such arbitrary methods of appor- 
tionment as have been generally followed by this Commission 
under similar conditions in other cases. As these methods have 
been fully described in other decisions and are well known, 
it will not be necessary to go into all the details at this dme. 

TABLE I. 

COMPANY'S ESTIMATE OF INVESTMENT CHARGEABLE TO STREET 

LIGHTING. 



ClaasiflcaUon. 



POWSB plant: 
Including real estate, buildings, stock, boil- 
ers, attz. engines, generators, etc.. 150 kw. . 

DIBTBIBUTION 8TBTBM: 

1.12S poles, average 40-6' to 7* top 

Labor on 1,125 poles, inc. setUnv, shavioff. 
setting guy stubs and anchors, trimming 
trees, etc 

Teaming for 1,125 poles 

1,700 cross-arms complete with pins and insu- 
lators 

Labor on 1,700 cross-arms 

193 spans and guys, material only 

28,517 lbs. wire (40.1 mL of No. «) 

Labor stringing 40.1 mi. of wire 

19S are lamps with cut-outs, ropes, pulleys, 
etc 

10 lightning arresters 

10 extra lamps 

10 extra cut-outs 



MISCBLLANBOVS: 

Delays, use and loss of tools, aettlemenu 
with property owners, moving curbs, legal 
services and other invisible items, 20% of 
above 



Engineering and administration, 
of above 



15% of 



Total distribution system 

Total investment chargeable to street 
lighting 



Unit cost. Cost new. 



9150 00 



700 



2 75 
125 



50 
50 



15 
20 00 

26 50 
10 00 
20 00 
400 



. 97.875 00 



3.008 75 
1,406 25 

850 00 
«50 00 
600 00 
4.277 58 
962 00 

5,114 50 
100 00 
200 00 
40 00 



125.389 06 



5.077 81 



930,466 89 
4.570 02 



ToUl 
cost new. 



922,500 00 



936,536 91 



157.586 91 



Table I represents the respondent's estimate of the cost new 
of that part of its present plant that is chargeable to the street 
lighting department. This estimate is so made up as to require 

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aXY OF SHEBOYGAN V. SHEBOYGAN BY. A EL. GO. 357 

further analysis. The first item therein covers 'the power plant 
and includes the real estate and buildings used ior this plant, 
tne intake, boilers with accessones, engine, generators, trans- 
formers, and other property sucn as is usually classed with the 
power plant proper. Ihe cost ot this power plant property is 
placed at It>iS:i,50U and it appears to be uased on tne proportion 
ot the capacity of tne plant that is devoted to the street lighting. 
This service was said to require 15U kws. ot tne total capacity 
of the plant, which was placed at 1,500 kws. If the capacHy 
relation is a sound basis upon which to divide the power plant 
cost, then it would also follow that the cost of the entire power 
plant amounts to about ^25,000, or to about $75,000 less than 
was said to be its book cost. 

The respondent further showed that of the 1,700 poles used 
for the street lighting system, 550 are used exclusively for street 
lighting, and ot the other 1,150 which carry both arc and com- 
mercial lighting wires, one-half is taken as chargeable to the 
street lighting system; and that $7 was considered as a fair aver- 
age price for ail such poles in use. The cost of teaming, as 
given in the company's estimate, is, according to the testimony, 
the actual average cost to the respondent company. The es- 
timated cost of stringing wires the respondent considers to be 
about correct for open country, but a very low cost for work in 
the city where trees and buildings iotferfere. According to the re- 
spondent's estimate, 49.1 miles of No. 6 copper wire are used 
in the street lighting system, and the cOst of this was computed 
at 15 cts. per pound. 

The use of 1,700 cross-arms was considered necessary by rea- 
son of the fact that poles used jointly for arc and commercial 
lighting require separate cross-arms. The 193 arc lights and 
their equipment actually cost, according to the testimony, a little 
more than the figure given in the company's estimate. The wit- 
ness stated that the investment required for street lighting would 
be much greater than that shown in table I, were it necessary to 
use a separate plant, not a part of a plant used for other pur- 
poses. 

The method pursued by the respondent in arriving at the value 
of that part of the power plant and its equipment which it has 
allotted to the street lighting, resembles a method that is some- 
times used in estimating the cost of proposed plants, namely : of 
basing the total cost upon the kilowatt generating capacity. In 



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358 



RAILROAD COMMISSION OF WISCONSIN. 



this particular case, however, that part of the total capacity of 
the plant that is held to be for the street lighting, appears to be 
based upon the capacity of the arc light transformers rather 
than upon either the connected arc lighing load or the actual 
capacity which the arc lighting requires. That this is the case, 
is supported by several facts. Tfie service statements and out- 
put records for June and December, 1909, indicate a demand 
upon the plant that is equal to about 100 kws. While the arc 
transformer capacity of the respondent appears to consist of 
the five transformers of 30 kw. capacity each, it appears that 
only four of these transformers are used at any one time. This 
would seem to indicate that the demand of the street lighting 
does not exceed 120 kws. That under such conditions the en- 
tire arc transformer capacity can be a safe basis upon which to 
apportion the power house equipment to the street lighting, is not 
probable. 

TABLE II. 
VALUATION OF THE PHYSICAL PROPERTY 

OF TH« SHEBOTGAN ElBCTRIO AND RAILWAY CO. 



ClaaslflcaUon. 



9. 
10. 
11. 
12. 
13. 
14. 
16. 
17. 
18. 
19. 
20. 
21. 
22. 

23. 
24. 

27. 
28. 
32. 
33. 
34. 



Land for rlffht of way ^ 

other land used in operation of property. . 

(iradin? 

Rridffes, trestles, culvertu and subways... 
Ties 



Ralls 

Special work 

Rail fastening and Joints 

Ballast 

Tracklaylnif and surfaclnir 

Roadway and track tools 

Fencini? and cattle guards 

Crossinirs and signs 

Telegraph and telephone lines 

8ta. waltinsr rms., way bldifs.. fix. & ffrounds 

Gen. office, bidfrs., fix., and ifrounds 

Shops and car house bldg-s., fix. and grrounds 

Shop equipment 

Power plant equl pmont 

Bub. sta.. transformer St a., andstorairebat., 
bldgs., fix. and trrounds 

Power plant equipment 

Sub. sta., transformer sta., and storage bat- 
tery equip 

Elec. transmission and distribution system . 

Misc. bldsrs.. fix. and grounds 

Revenue cars 

Elec. equipment of cars and locomotives 

Misc. and utility equip 



Total. 



New.! Exittinff. 



119,815 

703 

26,159 

8.606 

29,806 

68,690 

17,640 

42,461 

17,675 

20,879 

217 

M38 

287 

904 

906 

1.771 

8,099 

3.212 

32,509 

1,417 
103.350 

7,847 

183,911 

1,509 

44.675 

28,340 

6,153 



Total. Items 1 - .S4 1678,998 

35. lutei-est, en«rineerinfr, superintendence, con- 

tingencies, etc.. 12% 1-34 81,480 

36. Pavlnff 41,295 

37. Stores and supplies 17,340 



Grand total • 8810,132 



819. 

26, 
6. 

10. 

51. 
9, 

29. 

16, 

15, 



815 

702 

159 

002 . 

399 

374 i 

321 

008 

625 

951 

120 

569 

144 

710 

573 

105 

190 

002 

215 



1,383 
87,019 

586 



7, 
156, 

33! 

24, 

4, 



8544.005 



281 
934 i 
822 



8666.048 



Street lt«r. 



New. 


EiOBtiOff. 




887 


887 














> 












1 


















198 

87 

169 

3,747 


m 

78 

90 

3.601 


11.576 1 10.386 


i7,792 r 14.206 
166 157 




1 






833,830 

4,066 


828.706 
3.445 


l.OOB l.OOB 



838,900 I 883.154 



Digitized by VjOOQIC 



ClTY OF SHEBOYGAN V. SHEBOYGAN RY. A BL. CO. 



^9 



The valuation of the physical property of the Sheboygan 
Railway & Electric Company, as determined by the engineer of 
the Commission, for the year ending June 30, 1910, is shown in 
table II, and is based upon a detailed inventory of the company's 
property. In making the apportionment to street lighting, cer- 
tain items known to be used only for producing street illumination 
were apportioned entirely to that class of service; other items, 
representing equipment used for another or other classes of 
service as well as for street lighting, were apportioned, in gen- 
eral, according to methods which the Commission has usually 
employed in the valuation of properties of this kind. 

TABLE III. 
PARTIAL VALUATION. ARRANGED FROM TABLE II. 



ClasslflcaUon. 



2. 0th«r land used in operation of property 

18. General office bulldiiurs. fixtures and groundf 

19. Shops and car house buildings, fixtures and grounds 

ao. Shop eaulpmeD t 

21 . Power plant buildings, fixtures and grounds 

23. Power plant equipment 

28. Miscellaneous buildings, fixtures aud crrounds 

Total above items * 

aB. Interest, •nfflneerlnff. superintendence oontlnfrenciee, etc 
12% or above 

Total above items 



New. 



1702 
1.771 
8,099 
3.212 
82,509 
103,350 
1,600 



Existing. 



tl51«242 



18,140 



8160,391 



1,106 
6,100 
2,002 
81,216 
87,019 
1,247 



8189.600 

15.547 



8145,107 



The total cost new of those items in the engineer's valuation 
which are chargeable in part to street lighting service, excepting 
items 27 and 35 to 37, plus 12 per cent for interest, engineering, 
etc., on those items, is about $169,391, as is shown in table HI. 
This amount represents the cost new placed by the engineer upon 
that portion of the company's property which is included under 
the item "Power plant," and concerning which the company's 
witness testified to a book vahie of about $300,000. 

With a power plant cost of $169,391 and a capacity of 1,500 
kws., the average cost per kw. is about $113, or about $37 less 
than the cost given in the company's estimate. The engineers, 
in arriving at this figure, apportioned the property that was used 
in common for all the departments of the service on the respec- 
tive demands of the services involved and on various other bases 
that for the most part are now well understood. 

With respect to the distribution system also, the respondent's 
estimate appears to be somewhat higher than the figures that 



Digitized by VjOOQIC 



360 RAILROAD COMMISSION OP WISCONSIN. 

would ordinarily be regarded as normal costs under the circum- 
stances. When that part of this equipment which is used exclu- 
sively for street lightmg is allotted to this part of the service ; 
when the equipment that is wholly used for other parts of the 
service is allotted to the respective departments; when the poles 
are properly appraised; when poles that are used jointly by the 
different departments are apportioned equally between them; 
when guys and other items ai e divided on the bases of the total 
length ot the wire used for each department, then a lower cost 
than that given by the respondent is obtained for the distribution 
system. 

To its cost of the distribution system, as just described, the 
respondent has added 20 per cent tor such contingencies as de- 
lays, use and loss of tools, settlements with property owners, mov- 
ing curbs, legal services, and other items. In addition to this, 
it has also added 15 i)er cent of the same cost for engineering, 
administration, and miscellaneous purposes. These loadings ap- 
pear rather large. Some of the items are likely to have been 
covered in estimates already included. Other items, again, are 
placed at higher than probable cost. 

Upon this point we quote as follows from the decision in the 
case of City of Ripon v. Ripon Light & Water Co, 5 W..R. 
C. R. 1, 14: 

**Every aggressive and progressive utility is constantly called 
upon to make additions in or<l€r to adapt itself to the changing 
needs of the community served. The determination of these 
changes is within the legitimate scope of the general officers' du- 
ties, so that an allowance of 5 per cent on the total value can be 
regarded in no other light than that of liberality." 

For the purpose of the engineer's valuation, an allowance of 
12 per cent to cover engineering, superintendence, legal expenses, 
interest during construction, contingencies, etc., has been made 
upon the total physical value of the plant. This allowance is be- 
lieved to be ample under the circumstances. 

These facts indicate quite clearly that the street lighting de- 
partment should not be charged with a greater proportion of the 
physical property of the plant than the figures that have been al- 
lotted to it above in table II. As to which of the two items 
there given is the one upon which the respondent is equitably en- 
titled to reasonable returns, is not entirely clear. It depends very 
largely on facts which have not been made a part of the records 
in the case, and concerning which we have not been in a position 
to obtain reliable information. Generally speaking, however, it 



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CITY OF SHEBOYGAN V. SHEBOYGAN BY. A EL. CO. 



S61 



can perhaps be said that if the plant has not been earning its oper- 
ating expenses, including full depreciation and reasonable re- 
turns on the investment, then some value should be used that 
approaches the larger of the two figures. While the indications 
are that the street lighting department has carried itself during' 
at least the greater part of its existence, the conditions on the 
whole are such that it may not be equitable, in this case, to go 
far, if any, below the cost of reproduction. In fact, it would not 
seem to be safe to go so far below this figure that the effect on 
the interest charges would appreciably aflfect the cost per lamp 
per year of furnishing the street lighting. 

Earnings and Expenses. 
The facts usually presented in the income accounts of a plant 
are essential to a more thorough understanding of most of the 
issues that are usually raised in such cases as the one we are 
now dealing with. It is also obvious that the more complete 
such income accounts are, the more light they are also likely to 
throw upon the situation. In table IV is presented the respond- 
ent's estimate of the cost of furnishing the street lighting for 
the year ending June 30, 1910. In table V this cost for the 
street lighting is placed in comparison with the total cost of all 
the services that are furnished by the plant. The total cost for 
the plant in this case has been obtained from its records and re- 
ports. 

TABLE IV. 

COMPANY'S ESTIMATE OP ANNUAL EXPENSES CHARGEABLE TO STREET 

LIGHTING. 



Class! ficaUon. 



Items. 



Total. 



Material, supplies and labor: 

Globes, carbons and lamp repairs 

Trlmminir lamps 

Maintenance overhead lines (i of total. t2.834 12). 
Current. 379, d60kw. hrs.. at $11 60 per M 



I- 



•642 55 

835 30 
1. 407 06 
4.405 05 



Insurance: 

Employes* and public liability (i of total. 1850 39) 1130 19 

On power house (10% of total, taoo) 20 00 

Taxes(n.ll% of 18.000) I 

General expenses (11.11% of total, 116,980) 

Injuries and damages, stationery and printing, operation! 
stores department, operation horses, wagons, etc., (11.11% of 
total, 11,818 19) 



Depreciation and obsolescence power plant (8% of 122,500).. 
Pole line, excludinc copper wire (8% of 130, 759 33) 

Casualities (2% of total Investment. 157.536 91) 

Return on investment (8% of 157,530 91) 



Total annual expense. . 



11,800 00 
2,460 74 



r,348 96 



4.50 19 

888 80 

1,886 48 



207 56 



4,260 74 
1.150 73 
4,602 9o 



120,796 40 



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362 



BAILBOAD OOMIOSSION OP W1BG0K8IK. 



TABLE V. 
APPORTIONMENT OF ANNUAL EXPENSES 



ON Basis of Compavt'b Estimaw of Pobtiov Chabgiabi 

LlQHTIlfG. 


^B TO Qfl 


ratBET 






By., com. It. A pr. 


Street Itff. 


Clasaiflcatloti. 


Total. 


1 

. ■ 1 .r , 


Per 
cent. 


Amount. 


Power expenMs/. 


S39,4MM 

4.343 68 


88.86 < 135,090 10 
fifi 23 . 2.876 62 


11.15 
33.77 
49.41 


11,404 05 


Distribution expense 


1.467 06 


Consumption expense 

Commercial expense 


2.890 90 1 59.59 
3,919 81 , 100 
10,023 64 100 
0,898 M 1 100 


1,513 11 
3,919 81 

10,023 64 
9.898 39 
2.221 79 

87.21B 25 


1.477 86 


Way and structure expense 






Railway equipment expense .... 






Traffic expense 


2,221 79 
37.218 25 


100 
IQD 

98.33 

88.89 
91.87 






Oonductinir transDOrtatlon exD 












Total direct expense 

General expense 


1110.110 70 
16,980 05 
8.080 80 


St02.76l 80 
15,093 57 
7.429 06 


6.67 
11.11 
6.11 


67.84196 

1,886 48 


Undistributed 


667 7i 






Total abore items 


1135.177 61 


92.6B 


1125.284 43 


r.80 


•9,898 16 


Depreciation 


♦•seal 


Taxes , 


r,87i ii 


08.85 


6.068 89 


11.16 






Total operating expenses 










$15,048 72 


Reserve for extraordinary casu- 
alities, 2% ^ 








1.130 76 


Interest at 8<t I 








looTdS 




. . 










Total expense 











$20,796 40 













The facts in table IV being the ones upon which the respond- 
ent rests its conclusion, require some analysis. The two first 
items in this table, those urvder '^Globes, carbons, etc., and under 
"Trimming lamps,'* represent the cost for both street and com- 
mercial arc lighting. The street lighting, as stated above, re- 
quires 193 arc lamps burning 10^ hours daily. The commer- 
cial arc lighting consists of 95 arc lamps, burning about 6 hours 
each week. For all the arc lights the cost was $642.55 for 
globes, carbons, and lamp repairs, and $835.30 for trimmings. 
The question at this point is, on what basis to iddvide these costs 
between street and commercial arcs. As most of these expenses 
appear to depend very largely on the use of the arcs, it is prob- 
ably fair to allot them in proportion to the hours of burning. 
On this basis the cost for the street arcs will amount to only 
$616.84 for the former, and $772.70 for the latter of the above 
two items. 

The third! {"tem in table IV covers th€ cost of maintaining 
overhead lines. This cost for the year amounted to $2,934,12, 
and of this sum the respondent charged one-half to the street" 



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CITY OF SHKBOYQAN V. SHEBOYGAN BY. A EL. CO. 



arcs. As this expense is closely connected with the miles of 
line or wire in use, and as the miles of wire that arc devoted to 
the street lighting only amount to about 26 per cent of the total 
line mileage involved, it would seem that this charge to the street 
arcs is somewhat higher than it should be. The respondent did 
not furnish any reliable data as to the length of wire used, but 
the engineers of the Commission, in looking into the matter, dis- 
covered 176.05 miles of wire, of which 45.70 miles were devoted 
to street lighting. These facts are given in table VI, and it is 
upon these facts that we feel the apportionment of the above 
expense item ought to be based. 



TABLE VL 
MILES OF WIRE IN DISTRIBUTION SYSTEM. 


Classification. 


Company '8 estlm ate 


Ensrlneer's esti- 
mate. 




Miles. 


Percent. 


Miles. ! Percent. 

- . .- -1 


Commercial ll^ht and power 




about 

50.00 

about 

50.00 


130.35 74.04 


Street arcs 


4d.l 


45.70 25.06 






Total 




100.00 


176.05 100.00 









The power house expense for the year was $39,494.24 for all 
th^ departments of the service. Of this sum about $4,405.05 
was allotted to the street arcs by the respondents. This division 
ii, largely based on the amount of current generated for the vari- 
ous departments, as shown in table VII : 



TABLE VII. 

DIVISION OF POWER STATION OUTPUT. 
For Year Endino June SO, 1910. 



Classification. 



Railway 

Commercial Wght and power 
Street arcs..... 

Total 



Company's figures. 



Kw. hrs. • Percent. 



-h 



1,420.66Q , 

1,600,279 I 

ir79,660 



3,400,606 



41.01 
46.98 
11.11 



100.00 



Corrected flffures. 



Kw. hrs. 



1,475,775 

1,554,173 

870,660 

3,409,608 



Per cent. 



43.28 
45.58 
11.14 



100.00 



The total kilowatt hours generated amoun^t to 3,409,608, and 
of this amount 379,660 were generated for street lighting. From 



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364 



RAILROAD COMMISSION OF WISCONSIN. 



these figures a cost per M kw. hr. of $11.60 was arrived at, and 
this is the unit on which the results rest. A certain minor error 
crept into these calculations. The percentage of current for the 
street arcs is 11.14 per cent instead of the figure given. While 
this error is small, it is pointed out here in order to account for 
diflferences which may be found by using the figures in the 
tables themselves. For the same reason it may be said that 
the cost per M kw. hrs., as computed from the company's re- 
ported total power house output and expense, is $11.58 rather 
than $11.60. The power house expenses have, in effect, been 
apportioned by the respondent upon a basis of kw. hr. output. 
This procedure would necessitate the assumption that these 
expenses are all due to the output and therefore vary with it. 
Careful consideration discloses the fact that all power house 
expenses are not variable, but that some still continue whether 
the plant supplies power or not and therefore should be divided 
upon some other basis, perhaps, than the quantity of energy 
v/hich is supplied for different uses. The following table VIII 
shows the division which has been made in this instance between 
the power output expenses which vary with the energy generated, 
and the power capacity expenses which do not, and the division 
of these two classes of expenses between street arc lighting and 
the remaining service supplied by the power plant. 

TABLE VIII. 

DIVISION OP POWER EXPENSES. 





Total. 


Ry., com.liffht&pr. 


Street llffhtinc. 


ClasslflcaUon. 


Per 
cent. 


Amount 


Per 

cent. 

90.6 

88.88 


Amount. 


Per 
cent. 


Amount. 


Capacity 


23.5 
76.5 


i».M9 02 
90.225 22 


18,307 73 
26,858 13 


9.4 
11.14 


1871 29 


Output 


3.367 00 






Total 


100.0 


S3P.494 24 


89.3 


695,255 86 


10.7 


64,238 38 



In other words, k appears to us that the power plant cost is 
made up of capacity and of variable expenses, and that in the 
distribution of these expenses between the various departments 
the former should be based on the maximum demand and the 
latter on the output of current. 

Employes and public liability expenses were so divided by the 
respondent that 50 per cent thereof was charged to the street 
arcs, and 50 per cent to the rest of the lighting system. The 



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CITT OF SHEBOYGAN V, SHEBOYGAN BY. A EL. CO. ' 365 

reasons for allotting so large a proportion to the former are not 
clear, but may, in part, he due to the facts that there may be 
many similarities between the street lighting andi power circuits, 
that the voltage on the former is greater than on the rest of the 
system, and that the street lighting wires sometimes drop down, 
thereby becoming more dangerous. While there may be some 
force in these facts, experience indicates that for businesses 
of this character the fairest method usually is to treat expenses 
of this character as undistributed charges, to be apportioned on 
the same basis as other overhead items. 

Insurance and taxes on the property usually depend on the 
value of the property involved, and in such cases the fairest 
method of distributing such expenses is on the basis of the re- 
spective values. This method of division is, in fact, quite gen- 
erally adhered to, and under such conditions as those which 
prevail in this case would seem to be reasonable. 

General expenses, injuries, damages, etc., and other undis- 
tributed items of this character would seem to be of the nature 
of overhead expenses. They are, in fact, related to all parts 
of the service rather than to any one unit or a part of it. For 
this reas'on and other reasons they are usually distributed on the 
basis of the remaining, or on the direct expenses, and this 
method is perhaps as fair as any. If these expenses were de- 
pendent upon the output or current generated alone, then this 
output would be a just basis of distribution, but since this is 
not the case, it is also clear that k is not applicable for this 
purpose. 

The allowance which the company has made for deprecia- 
tion and obsolescense is 8 per cent upon the plant and distribu- 
tion system, exclusive of copper conductors. The reason as- 
signed by the company's president for excluding copper wire 
from the deprec'able property is that this class of material de- 
preciates very little. The same reasoning should lead, it seems, 
to the exclusion of the allowance of 20 per cent and 15 per 
cent for miscellaneous, and for engineering and administration, 
respectively, which the company has made upon the investment 
in copper wire devoted to street • lighting. The annual depre- 
ciation of the property actually used or useful for street lighting, 
as determined from the engineer's valuation, amounts to about 
4.7 per cent of the value new of the entire property used therefor. 
• For extraordinary casualties the company has set aside, in its 
estimate, 2 per cent of the street lighting portion of the entire 



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36tf 



RAILROAD COMMISSION OF WISCONSIN. 



plant value. The president of the company testified that this 
reserve is for extraordinary casualties, such as sleet storms 
which have occurred in times past, but which do not come every 
year and which might not come once in ten or fifteen years. 
The reserve which the company would set asid'e for such casual- 
ties' on this basis would, therefore, during the period specified, 
amount to from 20 to 30 per cent of the value new of the entire 
property of the company, a sum which it is difficult to justify 
for this purpose. Most accidents of this nature are usually 
provided for in the ordinary depreciation charges. 

The matter of the returns upon the investment is one that is 
both necessary and legitimate. Without it necessary capital 
could not be obtained, neither for the original construction nor 
for subsequent extensions. ' The rate of the return to which the 
plants are -thus entitled depend very largely upon current prices 
of capital and business ability in similar undertakings. These 
(iuestions have been fully discussed in other decisions of the 
Commission and therefore need not be further dwelt on here. 

When the operating expenses are apportioned along the lines 
which have thus been explained, and which appear to be just 
and fair under the circumstances, the results obtained will agree 
with the summaries given in table IX, which follows : 

TABLE IX. 

OPERATING EXPEWSES 
Or THE Street Liohtinq Depabtmbht of the Shevoyoan Railway and Elec- 
tric Co. 
For the Tear Endina June 30, mo^ aa Determined by the Commimion, 





, Total. 


Ry.. com. It. & pr, 


street Ilffhthw. 


ClasBlfldktlon. 


cent. 


Amount. 


Per 

cent. 


Amount. 


Power expanses 


1 

1 $38,494 24 
4,343 68 
2.900 91 
3,919 81 
10.023 64 
9,898 39 
1221 79 
37.218 25 


89.3 
81.74 

100 
100 
100 
100 
100 


$35.255 86 
3.550 51 
1,601 42 
3,919 81 
10.023 66 
9.898 39 
2.221 79 
37.218 25 


10.7 

18.26 

46.5 


$4,288 38 


Distribution expense 


70$ 17 


Consumption expense 


1.880 54 


Commercial expense 




\\'av and structure expense 






Railway eaulDment expense.... 






TrafHc exoense 


















Total direct expenses 

General expenses 


, $110,110 76 
' 16,990 73 

1 ^'^'^•^ 


94.17 
94.17 
94.17 


$10B.689 07 
15.900 11 
7,615 34 


5.83 
5.83 
5.83 


••SiS 


ITndislrlbuted 


471 is 






Total alxjvc items 


$136.177 61 

38.498 73 
1 7,872 19 


94.17 
96.2.-i 
9J.25 


$127,295 13 
36,670 43 
7.498 26 


5.83 
4.75 
4.75 


$7,892 « 

i;828 90 

373 $8 


Depreciation at 4.7% 

Taxes 






Total operatlnsr expenses.. . . 
Interest at S% 


$181,548 ^ 
66,5$9 76 


94.45 
96.25 


$171,463 81 
62,417 76 


5.55 
4.75 


10.064 73 
3,112 00 






Total ezDenses 


$247,078 29 


94.66 


$233,871 57 


5.84 


13, 19$ 72 







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CITY OF BfiSBOlTGAK V. SBABOYGAK Kt. A £L. CO. 367 

In taWe IX is thus given an apportionment of the total ex- 
penses of the Sheboygan Railway & Electric Company for the 
year ending June 30, 1910, showing the portion which we believe 
can fairly be charged to street arc lighting and the portion charge- 
able to railway, commercial light and power. For convenience 
in comparison, this table is in form similar to table V, the table 
in which these expenses as apportioned by the respondent are 
summarized. The difference between the amounts charged to 
street lighting in the two cases is accounted for in part by the 
difference in the methods of dividing certain of the items, and 
in part by a difference in the estimate of the items themselves. 
The two most pronounced differences to be pointed out are, 
first, in depreciation, which has been determined in the Commis- 
sion's table at a somewhat lower rate and upon a much smaller 
plant valwe than in the company's estimate, and, second, in the 
interest, for which the Commission has used the company's fig- 
ure, but which it has applied to a smaller plant investment. 

The total annual expense of the street lighting, as determined 
by the company in table IV, is, then, $20,796.40. Since it ap- 
pears from the testimony that 193 city arcs are supplied, the 
cost per arc lamp per year becomes, from the company's figures, 
about $107.70, while the revenue is only $74.00 per lamp per 
year. As has been said, the company's president testified that 
the reason the street lighting service can be carried at this ap- 
parent loss, is the fact that the fixed expenses would remain about 
the same if the company should cease to render this service. 

The total annual expense of the street lighting service, as de- 
termined by the Commission, is $13,196.72, which makes the 
average expense per lamp $68.38, or about $5.62 less than the 
price paid under the expired contract. 

In the income account there appears an item of $1,872.38 for 
non-operating revenues, derived from sale of steam, merchan- 
dise, etc. As the expense incurred in the production of service 
which brought about these revenues has been charged in the 
total plant expense from which the street lighting expense has 
been apportioned, some credit should be made to this service for 
its relative proportion of the revenues. A division of the non- 
operating revenues upon a basis of the total expense, 5.34 per 
cent of which appears chargeable to street lighting, seems to be 
as fair as any. When this method is employed, a credit from the 



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368 RAILROAD COMMISSION OP WISCONSIN. 

non-Operating revenues should apparently be made to street light- 
ing of about $0.53 per arc lamp per year. 

The costs which have thus far been worked out are based 
upon the operation of the street lighting property as it exists 
at present, producing a quality of street lighting service such as 
the company now furnishes. These expenses, it seems to us, 
are about as high as any that should ordinarily be charged 
against this department of the service. While these expenses, 
when compared with the revenues that would be derived from 
the street arcs under the old contract rate, indicate -that this 
part of the business is a paying proposition, this is something 
that can hardly be said of the plant as a whole. While the total 
revenues from all sources in 1910 amounted to about $197,500, 
the operating expenses and depreciation absorbed about $181,- 
549, leaving a net earnings of only $15,951, which sum amounts 
to less than 2 per cent on the cost of reproducing the plant 
This is much less than returns on the investment to which 
public utilities are ordinarily entitled. The reasons for such 
low earnings as these can, for the most part, be traced directly 
to the street railway, for which department the expenses appear 
to be out of proportion to the earnings. In other words, the 
people of Sheboygan appear to obtain street railway service for 
less than cost. Conditions of this kind are difficult to deal with. 
On the one hand, it may be argued that under circumstances, 
such as those that prevail in this case, losses in one department 
should be permitted to be made up from surplus earnings in the 
other department. On the other hand, it can be said that each 
department of the service should be self-sustaining and no 
more. In the former position there is a great deal of justice, 
but it is difficult, if not im]x>ssible, to equitably apply it. For 
these and other reasons we are leaning toward the latter vie^^ «.s 
being the most equitable in the long run. It is possible, however, 
that there are conditions under which, for social and economic 
reasons, it might be good policy for the city or community to 
depart, at least temporarily, from this rule. This is a matter, 
however, upon which we are not passing at this time. 

Quality op Service. 

In considering the complaint of the petitioner relative to the 
quality of street lighting service which the respondent company 
has supplied under its latest contract and is now supplying, it 



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CITY OP SHEBOYGAN V, SHBDOYGAN RY. A EL. CO. 369 

may be well to first have in mind a brief history of street light- 
ing in Sheboygan. In 1894 a street lighting Contract was en- 
tered into by the petitioner and the Sheboygan Light, Power & 
Street Railway Company, under which the company furnished to 
the city 9.6 ampere, direct current, open series arc lamps, for 
which payment was made at the rate of $95 per lamp per annum. 
The term of this contract was for ten years. During the last 
year of the contract the company substituted for the lamps then 
in use 7.5 ampere, alternating current, enclosed series arcs, which 
are the ones now in use and against which the city now brings 
its complaint. This contract expired in 1904, and in 1905 the 
city entered into a new contract with the Sheboygan Light, 
Power & Street Railway Company, to which the present She- 
boygan Railway & Electric Company is the successor. The 
term of the contract was for a period of five years, beginning 
June 19, 1905. Under the terms of this agreement, a copy of 
which we have already referred to as attached to the petitioners 
complaint, the Sheboygan Light, Power & Street Railway Com- 
pany bound itself to furnish to the city arc lamps of "full two 
thousand candle power,*' to burn each night from thirty minutes 
after sunset until thirty minirtes before sunrise, for which pay- 
ment was to be made at the rate of $74 each per year. No 
other words appear in the contract which might be descriptive 
of the lamps which the company was to furnish. In fulfill- 
ment of -its part of the agreement, the company continued the 
use of the lamps which it had installed the previous year. It 
is to be supposed that it was the intention of the company, r-t 
the time the contract was entered into, to continue the use of 
these lamps as complying with the provision for lamps of "full 
two thousand candle power.*' We have no record of objection 
on the part of the city during the early years of the contract, 
but during that time the city continued to cause additional 
lamps to be placed upon the system as it found desirable, for all 
of which the city paid at the rate specified in the contract. In 
February, 1910, which was about five months before the expira- 
tion of the contract, the city failed to make payment to the com- 
pany for lighting the streets during the preceding month, as 
had been customary. From time to time thereafter, as it ap- 
pears from communications received by the Commission, the 
company attempted to collect payment from the city for services 
rendered in the matter of lighting the streets of Sheboygan, but 
24— R. D. 



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970 BAiliROAD 0OMMIB8ION OV WISCOKflOf. 

were unable to do so, nor could any basis of agreement be de- 
cided upon by the two parties in dispute. 

Finally, on Sep. 21, 1910, the city of Sheboygan, through its 
attorney, caused complaint of the rate and quality of street light- 
ing service rendered by the Sheboygan Railway & Electric Com- 
pany to be brought before the Commission, and prayed, as has 
been pointed out earlier in this report, that the Commission es- 
tablish a reasonable rate for these services. At the same time 
the Commission instituted an investigation of the street lighting 
service in Sheboygan in order to throw more light upon the 
difficulties of the situation. 

In its petition the city has complained that the arc lamps 
furnished by the respondent electric company are not of as great 
a candle power as that provided in the contract, and this position 
was maintained at the hearing. It was the respondent's con- 
tention, in reply, that the 7.5 ampere, a. c. enclosed series arcs 
which were installed during the year preceding the time when the 
contract was entered into, were an improvement over the arcs 
then in use in Sheboygan, and that at the time the contract 
was made by the company and the city, whereby the former was 
to provide arcs of 2,000 candle power each, these^ lamps, which 
were then installed, were such as were commonly designated by 
that term and such as were sold by manufacturers under that 
specification, ahhough in reality the lamps may not have h^d 
an illuminating power of 2,000 candles. The respondent further 
contended, through the testimony of its witnesses, that the lamps 
which the company provided to meet the terms of the contract, 
made in 1905, were the best which could at that time be provided 
for street lighting, and that the candle power thereof was as 
great as that of any other arc at that time used for that pur- 
pose. 

The situation which here confronts the parties to this con- 
troversy is similar, in many respects, to others which have been 
met throughout the country in recent years. Street lighting 
contracts have been drawn up using a term in their specifica- 
tions which neither described any particular lamp or kind of 
lamp, nor expressed in any more than a vague and general way, 
as far as the state of the street lighting art was concerned, the 
intensity of the light source. How the term *'2,000 candle 
power," as used in street lighting contracts, originated, is a mat- 
ter for conjecture. E. L. Elliott, editor of the Illuminating 



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CITY OF 9HW0YQAN t;. SSSBOYeAK BY. A SL. CO. 371 

ENeiNWB, has said iu an article on ''Indefinite Candle Power 
in Municipal Contract;" 

''When the arc lamp first made its appearance it wholly baffled 
the attempts of photometrists, with the means then at their dis- 
posal, in their attempts to give even an approximate idea of its 
actual light-giving power. It is related that when one of the 
first commercial arc lamps was completed it was examined by a 
college professor, who was asked to give an estimate of its candle 
power. He replied in an ofF-hand manner that he thought it 
would run about 2,000 ; and an open a»rc lamp of that particular 
type has been called a 2,000 candle power lamp ever since. Al- 
though it was soon learned that such a rating was enormously ex- 
aggerated, the fiction, having once come into use, persisted to 
such an extent as to find its way into many lighting contracts." 

Whether or not this explanation of the origin of the term is 
exact, is not of real importance; the result, however, was about 
as stated. 

As early as 1894 serious objections were raised to the term 
"2,000 candle power" as used in contracts for municipal light- 
ing. At that time the National Electric Light Association went 
on record as opposed to this method of rating; and from then 
until 1908 that association has, through its several committees, 
conducted various investigations leading to the determination 
of the performance of various arc lamps under various condi- 
tions and to a recommendation for street lighting specificaticJns. 

It has been quite generally agreed by illuminating engineers 
and others familiar with the progress of the art of street lighting 
that the term "2,000 candle power'* was originally applied to 
open, direct current series arc lamps taking 9.6 to 10 amperes. 
As changes in street lighting equipment came about and alter- 
nating current series lamps were placed upon the market, 7.5 
ampere lamps of this kind were sometimes substituted for 9.6 
ampere direct current open lamps, which were being furnished 
under contracts calling for lamps of "2,000 candle power," just 
as we have observed substitution was made at Sheboygan under 
the earlier contract. In some cases, 7.5 ampere, a. c. enclosed 
lamps were introduced as complying with the same specifications 
in contracts of more recent date, as was done in the case of 
the last contract at Sheboygan. 

Probably the most noted case up to the present day to which 
we can refer as involving circumstances similar to those pointed 
out, is that which is known as the Colorado Springs Lighting 
Controversy. This case was decided by a board of arbitration 



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372 KAILBOAD COMMISSION OF WISCONSIN. 

before which all technicalities of the law were waived, with the 
in'tentioii that the controversy might be decided upon its merits 
alone. The circumstances out of which those proceedings grew, 
were in brief as follows : 

In 1898, the city of Colorado Springs granted, by ordinance, 
a franchise, later assigned to the Pikes Peak Hydro-Electric 
Company, giving permission for certain electrical construction and 
the use of certain water supplies. In return for this and some 
monetary consideration, the grantor was to be supplied with "arc 
lights of standard 2,000 candle power/' Until the grantee was in 
a position to furnish electric service, the city of Colorado Springs; 
in 1899, en'tered into a contract for five years with the El Paso 
Electric Company for the furnishing of lamps which "are com- 
mercially kn«wn as arc lamps of 2,000 candle power." This 
contract was later acquired by the Colorado Springs Electric 
Company, successors to the El Paso Electric Company, and in 
1901 the contract was changed so that the lamps then in use 
were described as *'6.6 ampere, enclosed arc lamps of the series 
alternating system." When in 1905 the Pikes Peak Hydro- 
Electric Company was finally in a position to light the city, it 
acquired the equipment used by the Colorado Springs Electric 
Company and continued to use the same for lighting the streets 
under the provisions of its own franchise. For about a year 
street lighting service was thus rendered. In 1906 the city 
attorney, reporting to the city council, stated that the company 
had "never furnished or offered to furnish to the city any elec- 
tric light of 2,000 candle power each." Following this, the city 
refused to pay the bills presented by the company, and after 
some preliminary proceedings, the matter was brought before 
the arbitrators. 

It may be observed that the lamps involved in the Colorado 
Springs case were 6.6 ampere, a. c. enclosed series arc lamps, 
while those with which we are concerned are 7.5 ampere a. c. 
enclosed series lamps. Nevertheless, the testimony and infor- 
mation presented at the hearings of the Colorado Springs case 
were so broad in their scope as to have a far-reaching impor- 
tance. It appears that some of the points brought out in that 
case having a bearing upon this. Two matters in this connection 
are of especial importance, the first of which appears in the de- 
cision of the arbitrators as follows: "Does the phrase 'arc 
lights of standard 2,000 candle power each mean an arc grving 



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CITY OP SHEBOYGAN V. SHEBOYGAN RY. A EL. CO. 373 

2,000 actual candle power, or, if not, what was the generally 
accepted meaning at that time?*' 

"On this question the experts on both sides unanimously agree 
that at the date of the granting of the franchise, namely, Sep. 8, 
]898, there was no arc light in use for street lighting purposes 
of 2,000 actual candle power, and therefore the phrase cannot be 
taken literally. The testimony of all experts, however, shows 
that there was one particular type of arc lamp, namely, a direct, 
constant current series, open arc lamp, taking 9.6 amperes and 
consuming 450 watts at the arc, which was generally acceptedi 
at that time as complying with the meaning of the phrase." 

The second matter appears as follows in the conclusion pre- 
sented by Henry Floy, one of the arbitrators, in h's book 'The 
Colorado Springs Lighting Controversy:" 

"The controversy emphasized the recent development of 
thought in the art of lighting by distinguishing the relation be- 
tween candle power and; illumination. The arbitrators, in deter- 
mining the real right of the matter, were unwilling to consider 
only the candle power — ^maximum, mean spherical or mean hem- 
ispherical — in comparing -the light of the franchise with that 
actually furnished. Although not wholly complete, the expert 
testimony indicated that, as ordinarily operated in America, the 
street illuminating service rendered by a 7.5 ampere, alternating 
current series enclosed arc lamp was about as satisfactory as 
that by a 9.6 ampere direct current series open arc lamp." 

As to what is the exact meaning of the term "full 2,000 
candle power" as used in the 1905 street lighting contract of the 
city of Sheboygan, and whether or not the street arcs now 
in use in Sheboygan come within the meaning of that term, it 
seems unnecessary, in the absence of any contract at the pres- 
ent time, to pass upon for the purpose of this decision. But 
inasmuch as confusion in these matters has, to a more or less 
degree, been the cause for these proceedings, we have, in justice 
to them, presented some ideas bearing thereon. 

The matters which most concern us and to which we shall 
now turn our attention are whether or not the lamps owned and 
operated by the Sheboygan Railway & Electric Company are 
operating under normal conditions, whether or not these lamps 
are such as to operate satisfactorily upon a system of this kind, 
whether or not the city's complaint is true that the street light- 
ing system does not receive proper care and attention, and if 
these may be answered in the negative, what changes are nec- 
essary to produce normal operating conditions, and what will 
be the effect of such changes upon the cost of operation. 



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374 RAIliROAD OOMIOMIOK OP WlSOOKSm. 

In order to determine these points, only one course at present 
presents itself as open to our purpose, namely: a comparison 
of observations of the performance of the equipment with ob- 
servations, either by the Commission's staff or others, of the 
performance of other equipments of the same kind. The pur- 
pose, then, of the observations which will follow, is not to 
determine the actual illuminating power of a ''2,000 candle 
power" arc, nor to devise a means for specifying street illum- 
ination in contracts. These two problems do not properly enter 
into this case. The purpose, as has been suggested, is to de- 
termine the relative normal and actual performances of this 
system. That methods differing somewhat from those followed 
by the Commission's inspectors might have been used, is rea- 
sonable to suppose. It is possible that any course pursued in 
determining the merits of apparatus of this kind might meet 
with criticism from advocates of some other slightly differing 
procedure. 

Tests were made by inspectors of the Commission from Sep. 
7 to 10, 1910, upon some of the street arcs used in Sheboygin 
while operating under service conditions. The results have been 
tabulated as shown in table X, copies of which were submitted 
to the petitioner and respondent together with the following 
comment by the engineering staff: 

"The lamps in Sheboygan are a. c, 7.5 ampere, enclosH 
series arc lamps. An examination was undertaken by inspectors 
of the Commission with a view of ascertaining the illumination 
furnished by these lamps and of comparing them with similar 
installations in the state. For this purpose the illumination at 
fifty feet from the lamp was measured for twenty- four lamps, 
and the complete distribution for distances up to two hundred 
feet from the lamp was secured for three lamps. The instru- 
ment used was a Sharp-Millar Universal Photometer, which had 
been carefully calibrated. The accompanying curves (chart I) 
show the distribution of light in foot-candles for the three lamps 
for which these data were taken. The table, column 9, shows the 
foot-candles at a distance of fifty feet for twenty-four lamps. 
The location, height of the lamps, date, time of day, and direc- 
tion from the lamp are given. All of the measurements of illum- 
ination were taken in the vert^'cal plane, with the instrument set 
up in the middle of the street facing the lamp. At the same 
time that the tests of illumination were made, testa were also 
made of candle power with a view of ascertaining the candle 
power of the lamps under conditions in effect at the time. The 
measurements were made with the instrument set in the middle 
of the street and at such a distance from the lamp as was neces- 



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CITY OF SHXBOTOAK V. SHEBOYGAK RT. A EL. CO. 



376 



sary to secure readings at an angle of 45 degrees, which is about 
the angle at which the candle power is a maximum. A few ad- 
ditional lamps were taken, so that figures were obtained for 
thirty-one lamps. The results are set forth in colimin 4. It is, 
of course, evident that the value of candle-power shown here will 
not be the same as those taken under different conditions, such 
as for example tests made in the laboratory, which are the con- 
ditions usually adopted for making tests for candle-power rating 
of lamps." 

TABLE X. 

TEST OF STREET LIGHTS, SHEBOYGAN. WIBC0N8IN. 

Septmber 7 to 10, 1910. 



















Direc- 


Illumi- 


















tion of 


nation 


No. 


Location. 


Height. 


C.P. 


Angle. 


Date. 


Time. 


Inst, 
from 


in toot- 
candles. 


















lamp. 


50 feet. 


1 


2 


S 


4 


5 


6 


7 


8 


9 


1 


5th & Michigan.. 
3rd&MlchLfiran.. 


18 

27' 




180.5 
189.4 


44 
45 


9-7-10 
9-7-10 


9:00 
9:43 


West 
North 




2 




3 


6th & Huron 

6th & National.. 
9th & National . . 
10th & Huron.... 
10th & St. Clair.. 
Oth&Erie 


22' 
23' 
17 
26 
23 
25 


6- 
10' 
6" 

10- 
6- 


128 
270 
117 
160 
183 
266 


46 
45 
45 

43 
45 
45 


9-7-10 
9-7—10 
9-7-10 
9-7-10 
9-8-10 
9—8—10 


10:^7 
10:50 
11:08 
11:30 
12:06 
8:15 


North 
South 

North 
South 




i 




5 




6 




7 




8 


"o.m" 


9 


9th & Niagara... 


24' 


4" 


239 


44 


9-8-10 


9:50 


North 


.072 


10 


6th & Ontario , . . 


25' 


6" 


139 


45 


9-8— 10 


11:30 


West 


.06 


11 


10th & Indiana . . 


22' 


10" 


345 


45 


9_-^_10 


8:10 


East 


.065 


12 


nth & Indiana.. 


16 


3" 


283 


45 


9-9-10 


8:25 


East 


.077 


13 


13th & Indiana.. 


21' 


8" 


313 


45 


9—9^10 


9:05 


West 


.072 


U 


15th & Indiana.. 


19' 




342 


45 


9-9-10 


9:25 


East 


.087 


15 


15th & Alabama. 


22' 


7" 


354 


45 


9—9—10 


9:47 


West 


.074 


16 


16th&Georsria.. 


25 


11" 


321 


45 


9-9-10 


10:10 


West 


.065 


17 


16th it Kentucky 


15 


9' 


105 


45 


9—9—10 


10:85 


West 


.087 


18 


14th & Maryland 


22' 


6" 


108 


45 


9_9-l0 


11:05 


West 


.075 


19 


15th & N.Jersey. 


21' 


6" 


344 


45 


9-9-10 


11:25 


North 


.091 


20 


14th & Vlnrinia.. 
15th Sl Jefferson. 


22 


5" 


210 


45 


9-9-10 


11:45 


West 


.074 


21 


23 


9" 


222 


45 


9— IOl-10 


12:05 


East 


.063 


22 


13th & Jefferson. 


21' 


8" 


248 


45 


9—10—10 


12:15 


South 


.04 


23 


6th & Wisconsin. 


17' 


5" 


200 


45 


9-10^10 


8:00 


West 


.096 


24 


5th & Niafirara. . . 


21' 




141 


45 


9—10-10 


8:20 


West 


.047 


25 


5th&Erie 


20' 


10" 


201 


45 


9_10_I0 


8:40 


East 


.049 


26 


4thdcSt. Olair... 


23 


6" 


162 


45 


9—10—10 


9:06 


West 


.042 


27 


4th & Huron 


22 


6" 


109 


45 


9-10-10 


9:38 


West 


.058 


28 


3rd & Superior . . 


20' 




140 


45 


9-10—10 


10:20 


West 


.066 


29 


5th & Superior . . 


23 


6" 


181 


45 


9-10-10 


9:55 


West 


.058 


30 


9th & Superior .. 


23 


6" 


207 


45 


9-10—10 


10:40 


East 


.048 


31 


11th & Superior.. 


24 


2" 


162 


45 


9-10-10 


11:00 


West 


.028 



The above tests were made prior to the hearing of .this 
case. Subsequently additional tests of various kinds have been 
made by the engineering staff upon the street lighting system of 
Sheboygan, as well as upon systems in other Wisconsin cities 
having 7.5 ampere, a. c. series enclosed street arcs. These 
observations covered, in general, such matters as power con- 



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376 



RAILROAD COMMISSION OF WISCONSIN. 



sumed between the lamp terminals, power consumed per lamp 
as measured at the plant, lamp voltage, circuit current, candle 
power of the arc lamp at an angle of 45 degrees below the 
horizontal, and measurements of illumination produced. In all 

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cases, except for a portion of the observations obtained during 
the second set of tests at Sheboygan, measurements of illum'n'i- 
tion were made in the vertical plane. There is still consider- 
?ibl^ difference of opinion cpncernin|[ which reference plaqe 



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CITY OP SHEBOYGAN V, SHEBOYGAN RY. A EL. CO. 377 

should be used in making these tests. It is safe to say that 
when no other observations are considered, there are disad- 
vantages arising from the use of any particular plans. 

In 1907 a committee of the National Electric Light Associa- 
tion recommended that for lamps, such as we have under con- 
sidieration, street lighting specifications should require that the 
test or comparison be a measurement of illumination in a plane 
normal to the rays of light from the lamp st a point about 250 
feet from the lamp under test. It may be well to explain that 
three reasons worthy of consideration occurred to the inspectors 
for not confining themselves to observations of this kind. First, 
the measurement of the illumination at a single point and in a 
plane normal to the rays of light is little diflFerent from a unidi- 
rectional measurement of candle power, from which it appears 
manufacturers, central stations and engineers have for sev- 
eral years tried to free themselves; second, that at the distance 
specified for measurement of illumination, the intensity is so low 
as to be extremely difficult of reliable measurment with equip- 
ment now available; and third, that while measurements cf 
illumination at a certain distance from the light source and upon 
a certain plane may eventually be generally adopted for street 
lighting specifications, it can hardly, in the present unsettled con- 
dition of professional opinion, be said to present sufficient in- 
formation, for comparative purposes, concerning the perform- 
ance of a street lighting system. 

The observations made during the first series of tests at She- 
boygan have been arranged graphically as shown in chart II, 
in which are given heights of lamps above the street surface, 
candle-power measurements at 45 degrees below the horizontal, 
and measurements of illumination in the vertical plane at *a 
distance of 50 feet from a point directly beneath the lamp. 
The observations are arranged consecutively in the order of the 
magnitude of the observed candle power, and the averages of 
the observations are as follows : Height of arc lamp, 22.5 feet, 
candle power at 45 degrees, 218 c. p., illumination at 50 feet, 
0.0665 foot-candles. 



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378 



RAILROAD COMMISSION OF WISCONSIN. 



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Chart III represents the average distribution of illumination 
for three street arcs in service in Sheboygan. The curve is 
drawn to a distance of 200 feet, beyond which point a portion of 
the values could not be determined, as the intensity fluctuated 
above and below the lower measuring range of the photometer 
employed. 



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CITY OF BHSBOIOAN V. SHBBOYaAN BT. * XL. CO. 



379 



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The tests which were made at Sheboygan Nov. 22 to 28, 

1910, have also been arranged graphically, as shown in chart IV. 

In addition to the heights of lamps, candle-power measurements 

at 45 degrees, and illumination measurements in the vertical 

plane at 50 feet from a point beneath the lamp, chart IV shows 



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380 



RAILROAD OOMMISSION OP WISCONSIN. 



also the observations of illumination in a plane normal to the 
rays from the lamp at a point 50 feet distant, and the power con- 
sumed between the arc terminals. 











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The averages for twenty-one lamps tested are as follows: 
Height of lamp, 22 feet ; candle power at 45 degrees, 193 ; illumi- 
nation in the vertical plane at 50 feet, 0.0695 foot-candles ; illumi- 



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CITY OF SHEBOYGAN V. SHEBOYGAN RY. A EL. CO. 



381 



nation in the normal plane at 50 feet, 0.074 foot-candles; and 
energy consumed, 430 watts. 

Measurements were made of the distribution of illumination 
from five lamps, the average of which is represented in chart V. 
In this chart is shown the distriibution of illumination in both the 
normal and vertical planes. While considerable difference seems 
to exist in the vicinity of the lamp, little difference is observed 
beyond 100 feet from the lamp. 





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Charts VI, VII, VIII, IX, X and XI represent similar obser- 
vations for three other Wisconsin cities in which the lamps used 
were such that comparable results were to be expected. Tests 
made upon other systems of 7.5 ampere, a. c. enclosed arcs, not 
using outer enclosing globes, are not presented nor used for com* 
parison. 




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CITY OF SHSBOYOXN V. SHEBOTOAN BT. A BL. CO. 



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RAILROAD COMMISSION OF WISCONSIN. 




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CITT OF SHEBOTQAN V. SHEBOTOAN BT. A EL. CO. 



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CITY OP SHEBOYGAN V. SHEBOYGAN RY. & EL. CO. 



387 




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888 RAILROAD COMMISSION OP WISCONSIN. 

Concerning observations of the street lighting system at She- 
boygan, the Commission's inspectors report reads, in part, as 
follows : 

"Behavior of arc regulators. A set of observations was taken 
at the Sheboygan plant during an entire evening in order to as- 
certain the character of regulation produced with the present 
station equipment. In this connection current readings of each 
arc circuit were taken by a member of the Commission's staff at 
{\y/e minutes intervals from 7 :25 p. m., to 12 :35 a. m. Readings 
of dials and revolutions of disk of the output meters were taken 
at one-half hour intervals during this period. Changes of 
weights on the regulator arms, to obtain normal current, were 
also recorded. 

"Circuit No. 9 showed the greatest tendency to vary, as 
indicated by number of times w^eights were added and removed 
throughout the period of observations, which was as follows: (1) 
removed weight at 8:50; (2) added more at 9:15; (3) added 
more at 9:35; (4) added more at 10:05; (5) removed some at 
11:05; (6) added more at 11:40. The above variation probably 
accounts for some of the changes in circuit current observed in 
connection with the field «tests carried on coincident with this 
test, as well as at other times. 

"The apparent inability of the regulators to maintain normal 
current, as indicated by the foregoing observations, and the ne- 
cessity of continual addition and removal of weights, appear to 
indicate that same are somewhat at fault. 

"Fluctuations of illumination and wattage were most notice- 
able when arc lights were operated from the railway generator. 

"There is also a gradual inherent tendency of the regulators 
to creep and cause variation of circuit current unless watched 
closely. This fact was made known on the first night of the in- 
spection, when weights were observed to have been altered be- 
tween the hours of 7 :00 p. m. and 1 :30 a. m. 

"There is also a tendency of the present type of circuit am- 
meters to get out of calibration, which is evidenced by results 
of calibration made in September, at which time the instruments 
were found to be in error. A correction value was submitted 
and applied by the company. Another calibration, in November, 
showed the ammeters to be again considerably in error, hence 
the necessity of providing for a routine calibration at frequent 
intervals with a portable standard. * * * 

"An inspection of the company's apparatus at the shop, used 
in testing and adjusting arc lamps, furnishes evidence for com- 
ment in connection with the performance of the lamps on the sys- 
tem. 

"Briefly, the apparatus is a home made regulator of two-light 
capacity, operated from the 220 volt a. c. service. It was noticed 
that the regulator would operate for only a short time on two 
lamps, due to excessive heating, and with one lamp the period 



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CITY OF SHfiBOYGAK V, SHHiBOYGAN RY. & EL. CO. 389 

was somewhat longer, but not sufficient to bring the lamp to 
normal operating conditions. As a result, the outfit does not give 
constant regulation for a sufficient period to obtain an adjustment 
comparable with lamps under actual service conditions. 

"After any repairs are made, the arc is connected in circuit 
with an indicating ammeter and wattmeter and an immediate ad- 
justment is made for approximately 470 watts under normal 
current of 7.5 amperes. In this adjustment, a separation of 
carbons of from % inch to % inch is considered equivalent to 
72 volts. The lamp is then ready for service. No further at- 
tention is given, except that any deficiency is noted and reported 
by the arc patrolman, whose duty is only to see that lamps are 
burning on his daily rounds. 

'The results of a check test made at the shop on a lamp ad- 
justed for service, showed that the method above described does 
not afford reasonable accuracy of adjustment of lamps. 

"The main objection to the present method is in the operation 
of the test regulator, the tendency of which is to heat up after a 
short period of operation, thereby causing changes of current 
different from normal conditions. There are instances where 
such home-made arrangements as this are giving satisfactory 
service. Average practice of shop testing and adjustment of arc 
lamps, indicate that lamps, after being repaired, should be con- 
nected in circuit, adjusted and allowed to bum till up to normal 
operating temperature (from one to two hours), and then given 
a final adjustment for normal conditions of current voltage, etc. 

"Although the wattage of a lamp is not a criterion on which 
to base the effective candle power produced, it serves, along with 
the current, as a check on the proper adjustment of the arc, just 
as, in some instances, the voltage with a given current indicates 
standard adjustment and, in still other approximate methods, a 
fixed length of arc and given current are used. It is therefore 
evident from the observations that considerable range of adjust- 
ment has been found and, as a consequence, variable candle pow- 
ers exist. 

"Among other things, the manufacturer of the lamp used in 
Sheboygan have stated that 'the type L-7 shunt wound lamp is 
recommended for the smaller circuits where the number of lamps 
does not exceed say 25, and when it is necessary to vary the cur- 
rent strength on the circuit at frequent intervals, as the voltage at 
the arc remains constant for all current strengths.' 

"The arc lamp circuits of the Sheboygan system are operating 
with about 50 lamps in each circuit, which is somewhat in ex- 
cess of the number per circuit specified by the manufacturer. 
The results of the tests showed the regulation of the lamps to 
average from 50 to 77 volts per lamp, and a variation in cur- 
rent from 7.1 to 8.1 amperes. Allowing for the variation of 
current, on the basis of the manufacturer's statement that the 
mechanism is entirely independent of current strength and will 



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390 RAILROAD CX)MMISSION OF WISCONSIN. 

maintain a given voltage across the arc whatever the current, it 
appears that the lamps are not all operating up to the standard 
specified. 

"Compared with other systems representative of about normal 
performance, in which lamps of a 7.5 ampere a. c. series, en- 
closed type, average 250 c. p. at 45 degrees, the average of 
193 c. p. for Sheboygan appears low. The candle-power tests 
made in November show values somewhat less than those made 
in September. The September tests averaged 218 c. p., while 
those made in November averaged 193 c. p. 

"The average illumination at the 50 ft. point is less than that 
observed for other plants of more nearly normal performance. 
The readings obtained at 250 feet from the arc are at a point . 
where illumination is very difficult to measure, it being in most 
cases practically the limit of the range of the instrument. 

"Compared, again, on a basis of the wattage per lamp, the 
average of which is 475, the Sheboygan average of 430 watts 
appears low. The station arc output for Sheboygan, measured 
by station recording wattmeters, corrected for error, was 575 
watts per lamp. This observation covers a period of four days, 
during which deduction was made for observed outages reported 
by the city and company. The output per lamp for the other 
systems, representative of normal performance, in no case equaled 
the Sheboygan value ; but the former figures were not considered 
sufficiently reliable, on account of the station output meters not 
having been checked, and therefore were not used for the pur- 
pose of comparison. For the average wattage shown by the tests 
made at Sheboygan, the station arc output appears to be some- 
what in excess of the required amount under normal conditions 
of performance. 

*'In conclusion, it appears that the lamps are not operating up 
to the normal performance for a 7.5 ampere, series arc, enclosed 
lamp of this type ; and the factors contributory to this condition 
are the company's method of adjustment of lamps, the behavior 
of station arc regulators as operated on this system, and errors 
of current ammeters." 

The president of the respondent company testified that the 
power consumed between the terminals of lamps of this kind is 
about 480 watts. This amount is the usual rated consumption 
of these lamps and is approximated by the average lamp con- 
sumption observed by the inspectors for lamps on other similar 
systems. Wattage tests upon twenty-one street arcs in Sheboy- 
gan show an average ix)wer consumption of 430 watts. The 
present street lighting output from the plant, as determined by 
the inspectors, appears to be about 575 watts per lamp, which 
seems to be ample, and, if anything, somewhat greater than is 
ordinarily required for a system of this kind, after allowing for 



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CITY OP SHEBOYGAN V. SHEBOYGAN RY. & EL. 00. 391 

transformer an<d distribution losses. The indications, therefore, 
are either that unusual losses occur which should be sought out 
and prevented, or that a considerable number of lamps are con- 
suming an abnormally large amount of power between the lamp 
terminals, a condition which was not discovered by the tests 
made by the inspectors. 

The conclusions which may be drawn from the investigation 
of the street lighting service are that the equipment of the She- 
boygan Railway & Electric Company is not being operated so 
as to rend-er a fully normal street lighting service, that proper 
arc testing equipment and methods may be expected to effect a 
material improvement in the quality of service rendered by the 
system now in use, and, finally, that no considerable increase in 
cost of plant operation should result from necessary changes. 

The shunt type arc lamp, such as is used in Sheboygan, is not 
recommended by the makers for use on circuits having as large 
a number of lamps as those in Sheboygan. Certain inherent 
characteristics exist in this lamp which cause it to be less steady 
in its operation than the differential type, when used on circuits 
supplying a large number of arcs. Great care should therefore 
be exercised in its operation. 

The Sheboygan Railway & Electric Company should therefore 
provide itself with such equipment and adopt such methods and 
{practice as will ensure greater uniformity in the adjustment and 
oix^ration of the arc lamps in use upon its street ligfiting system, 
and the standard to be used in such adjustment should be a 
consumption of 480 watts between the lamp terminals, an elec- 
trical pressure across the arc of 72 volts, and a current value of 
7.5 amperes. The lamps should be trimmed, cleaned, and other- 
wise operated under such conditions that the illuminating power 
of the arcs, adjusted as above described, shall not be diminished. 
Although the wattage consumption is not of primary importance 
to a party engaging the services of equipment for street lighting, 
in case such services are not paid for on a basis of the energy 
consumed, and although statements regarding energy and pressure 
to be supplied are not sufficient in a street lighting specification 
to determine the quality of illumination to be produced unless 
other facts are known about the equipment to be used, neverthe- 
less, it is believed that such requirements as the foregoing may 
properly apply for the determination of the normal operation 
of such a system of street lighting as we have had under consid- 
eration. 



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392 RAILROAD COMMISSION OP WISCONSIN. 

In order to further determine whether or not the quality of 
service rendered by the Sheboygan street lighting system is as 
good as may be fairly expected of such a system, operated under 
normal conditions, we have compared the results of tests thereon 
with observations of the performance of other systems and with 
conditions which good practice indicates are normal. To deter- 
mine to what degree the quality of this service deviates from that 
of normal service, requires a more complex and quantitative 
analysis. 

Expert opinion differs as to what are the important features of 
street lighting, as well as to kow the quality of the service should 
be measured. From even a casual consideration of street light- 
ing requirements the conclusion may be drawn that, as objects and 
persons are continually changing their relative positions upon and 
along the streets, as these objects and persons are more crowded 
in some localities or some portions of the streets than others, 
and as their purposes and interests are various, different methods 
of illumination may be better adapted to one situation than an- 
other, and this being so, that when one system of fighting prevails 
throughout a city, different considerations should be employed' to 
determine with precision the relative usefulness of a light source. 
A further study of the problem discloses the fact that there are 
many inherent features of the operation of a street arc-lighting 
system, as well as features dependent upon local methods of 
operation, which affect the performance of the light source. 
Among these may be cited the effects of the height of the arc 
in the lamp and of the deposit from the carbon upon the enclos- 
ing globe. A careful consideration of all the conditions affect- 
ing the illuminating qualities of an arc, of the conditions under 
which it may be used, and of the various observations resulting 
from different methods of measurement, would lead to such a 
maze of thought and reasoning in arriving at a precise figure 
representing the quantitative difference in the quality of a street 
lighting system, that the value desired would be difficult of de- 
termination. And as the method of arriving at the quantitative 
difference would be dependent not upon an exact science alone, 
but human judgment as well, the value so determined might 
still be controvertible. 

Various data, from actual tests, are at hand from which a 
quantitative opinion may be found as to the quality of the street 



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CITY OP SnEDOYGAN V, SHEBOYGAN RY. A EL. CO. 393 

lighting service in Sheboygan. Shorn of all complexity, this in- 
formation may be presented, with brief comments, as follows : 

Wattage tests, although not indicative of the amount of light 
given by an arc lamp, are, when measured at the lamp, an in- 
dication of the condition of a series lamp's adjustment. Wat- 
tage measurements were made upon nineteen lamps in Sheboy- 
gan while the lamps were connected in their usual place of serv- 
ice, and it was found that the average power taken per lamp 
was 430 watts. Similar measurements made upon forty-two 
lamps in three other cities gave, as an average consumption per 
lamp, 474 watts. This latter value approximates very closely 
the normal wattage of 480. Using 480 watts as a basis of 
comparison, the street arc lamps of Sheboygan fell short of 
proper service by about 10 per cent. 

Candle-power measurements in a certain direction, although 
when taken alone are considered by some experts to be un- 
reliable as a lamp rating, are some indication of the relative 
normal operation of lamps having the same characteristics of 
light distribution. The inspectors made candle-power measure- 
ments at 45 degrees below the horizontal for fifty-two street arc 
lamps in Sheboygan. The average intensity, at this angle, was 
determined to be 210 candle power. Tests, made by the in- 
spectors upon forty-seven lamps in other cities, gave an average 
of 292 candle power. The difference in the average candle- 
power measurements is about 28 per cent. 

The same remarks which were made concerning unidirectional 
measurements of candle power may apply as well to measure- 
ments of illumination at a certain distance from the lamp and in 
a certain direction. The average illumination falling upon a 
vertical plane, 50 feet distant from a point beneath the lamp, 
as observed from tests upon forty-five lamps in Sheboygan, was 
0.068 foot-candles, while similar tests upon fifty-five lamps in 
other cities resulted in a determination of an average of 0.083 
foot-candles. The difference is about 18 per cent. 

The a.verage illumination, similarly measured at 260 feet, 
was 0.00312 foot-candles, as observed from tests upon eight She- 
boygan lamps. Tests upon eleven lamps in other cities show an 
average of 0.00395 foot-candles. The difference is about 21 
per cent. 

A comparison of the mean illumination, over a considerable 
area, may also serve to determine the difference in the effective- 



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394 RAILROAD COMMISSION OP WISCONSIN. 

ness of a light source. Great care should be exercised in using 
such a ccMTiparison,- as differences near the lamp, where the il- 
lumination is sufficient, may more greatly affect the results than 
differences at a distance, where the illumination is insufficient. 
The mean illumination, along the street from a point beneath 
the lamp to a point 250 feet distant, as determined from tests on 
eight Sheboygan lamps, is 0.0328 foot-candles. A similar value, 
determined from tests upon fourteen lamps in other cities, was 
0.0452 foot-candles. The difference is about 27 per cent. 

These facts, as stated, were largely obtained by actual tests. 
While these tests are not as numerous as might be desired, they 
shed a great deal of light upon the situation. They indicate 
quite clearly that at the time they were made, the efficiency of the 
street lighting service was several points below what may reason- 
ably be regarded as a normal condition under the circumstances. 
Owing to the peculiar nature of these shortcomings in the light- 
ing efficiency and the uncertainties that exist with respect to 
their duration and to the injuries, if any, that were thereby in- 
flicted upon the city, it is exceedingly difficult to place a money 
value upon them. In fact, in the absence of regular tests dur- 
ing the entire period involved, it is almost impossible to obtain 
safe bases for such purposes. In view of these and other facts 
we have not attempted to fix a specific value thereon for the 
purposes of this case. 

From these considerations of the facts, it appears to us that 
under present conditions a rate of $68 per street arc per year 
would be a reasonable rate for the arc lighting involved in these 
proceedings, and"- that the respondent should immediately take 
such steps as may be necessary to bring. the service up to a point 
where it can be regardt'd as reasonable adequate. 

It is Therefore Ordered, That the rate for street light- 
ing service in Sheboygan shall not exceed $68 per arc lamp per 
year; and 

It is Fi'RTiiER Ordered, That this service be so improved as 
to become reasonably adequate, 



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In re AprL. manitowoc a northern traction co. 395 



IN RE APPLICATION OF THE MANITOWOC AND NORTHERN 
TRACTION COMPANY FOR PERMISSION TO INCREASE ITS 
PASSENGER RATES BETWEEN THE CITIES OF MANITOWOC 
AND TWO RIVERS. 



Decided F&b. 3, 1911, 



Petition for authority to increase the passenger rate of 10 cts. betweem 
the cities of Manitowoc and Two Rivers to 15 cts., an amount 
in excess of the maximum provided in the franchise, and for 
an order putting in effect such increased rate as an emer- 
gency rate, pending the hearing and decision on the applica- 
tion. 

The case was taken to the courts in injunctional proceedings. The 
circuit court held that the existing rate of 10 cts. was unrea- 
sonable and the proposed rate of 15 cts. reasonable. The su- 
preme court held that the Commission has power, in proper 
proceedings, to increase the rate beyond the maximum pro- 
vided in the franchise. 

It is apparent that If the franchise rates are restored, it will result in 
such a diminution of the petitioner's revenue as to Jeopardize 
the public service. Petitioner is therefore authorized to main- 
tain its present rate of 15 cts. until further order of the Com- 
mission. 

The Manitowoc & Northern Traction Company has filed a 
petition wherein it prays that it be authorized and permitted to 
charge such rates as shall be found just and reasonable upon 
final hearing of the petition, and, pending such hearing and 
determination, that the emergency rate of 15 cts. for travel be- 
tween the cities of Manitowoc and Two Rivers be fixed and 
authorized by the Commission. 

It appears that the franchise granted by the city of Manitowoc 
to the petitioner, authorizing.it to operate its interurban cars 
over the streets of Manitowoc, provides that the rate of fare be- 
tween the cities of Manitowoc and Two Rivers shall be 10 cts. 
On May 1, 1909, pursuant to a schedule of rates theretofore 
filed with the Commission, the petitioner increased its passenger 
fare between said cities. Thereupon the city of Manitowoc, in 
an action in the circuit court of Manitowoc county, obtained a 
temporary injunction restraining the petitioner from charging 
more than the rates provided for in said franchise for the trans- 



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396 RAILROAD COMMISSION OP WISCONSIN. 

portation of passengers. That immediately upon the service of 
said injunctional ord^r the petitioner returned to its old rates 
of fare, and such old rates remained in force until the temporary 
injunction, so issued, was dissolved. That thereafter the peti- 
tioner arranged a schedule of rates, which it put into effect, as 
follows : 

The rates of fare for the transportation of passengers from 
any point in either city to any point in the other city, 15 cts. ; 
from any point in either city to any other point in the same city, 
5 cts. ; from any point in the city of Two Rivers to the city lim- 
its of the city of Manitowoc, 10 cts. ; from any point in the city 
of Manitowoc to Lone Pine Station, 10 cts.; and beyond Lone 
Pine Station, 15 cts. ; tickets to be sold at the rate of twenty-four 
for one dollar, three tickets being accepted where the rate of 
fare is 15 cts. ; two tickets being accepted where the rate of fare 
is 10 cts. ; and one ticket being accepted where the rate of fare 
is 5 cts. 

In the action above mentioned the petitioner prevailed in the 
trial court, where judgment of dismissal was entered, and- there- 
after an appeal from such judgment to the supreme court was 
taken by the city of Manitowoc. The judgment of the trial 
court was reversed by the supreme court. It was held upon the 
appeal inter alia, that the rates provided in the franchise were 
binding until changed' by this Commission. 

From the facts before us, it is apparent that if the franchise 
rates are restored, it will result in such a diminution of peti- 
tioner's revenue as to jeopardize the public service in which it is 
engaged. The physical value of the property, as determined by 
the engineering staff of the Commission, shows that the cost of 
reproduction new is $174,437, and the present value $124,681. The 
annual report of the petitioner for the year ending June 30, 1910, 
shows that the total operating revenue amounted to $33,565.89, 
that the total operating expense amounted to $27,405.92, and the 
interest on funded debt $5,900, leaving a net income of $259.97. 
No amount was set aside for depreciation. If these figures are 
accurate, and we do not question them, it is obvious that any 
reduction in the rates of fare now charged- by the petitioner will 
decrease its operating revenue to a point where the same will 
be inadequate to keep the road in actual operation for any length 
of time. 

Upon practically the same evidence the circuit court of Winne- 



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In re APPL. MANITOWOC A NORTHERN TRACTION CO. 397 

bago county, in the action to which reference has been made, 
found and determined that a rate of 10 cts. for transporting 
passengers between the two cities mentioned was unreasonable, 
and that a rate of 15 cts. for such transportation service was 
reasonable under the circumstances. Upon the records and facts 
before the Commission we are obliged to concur in the finding 
of the court. Therefore, the petitioner will be authorized, until 
the determination of the application now pending, to continue 
in effect its present rates, which are found and determined to 
be reasonable. 

Now, Therefore^ it is Ordered, That the Manitowoc & 
Northern Traction Company be and the same is hereby author- 
ized to maintain and charge the rates now charged by it, until 
further order of the Commmission. 



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398 RAILROAD COMMISSION OP WISCONSIN. 



CITY OP NEENAH 

vs. 

WISCONSIN TRACTION, LIGHT, HEAT AND POWER COMPANY, 
WISCONSIN ELECTRIC RAILWAY COMPANY. 



Submitted Dec. U,, 1010. Decided Feb. i, 1911. 



Petition to compel the respondent street railway companies to establish 
joint fares in the city of Neenah. The question of the juris- 
diction of the Commission, heretofore raised by the Wis. Tr. Lt. 
H. ft P. Co.. has been determined in a former decision. Both 
respondent companies operate interurban itiilways, and also 
operate their cars over lines in said city. Each company 
charges a fare of 5 cts. for travel upon its cars within the 
city limits, thereby compelling patrons using both lines to pay 
viouble fare. 

Held: That the Commission has the power to vary a rate fixed In a 
special franchise granted by a municipality to a street rail- 
way company; that in the instant case the necessity of a joint 
rate is well established. Respondents are ordered to discon- 
tinue their present local fares and substitute in lieu thereof 
a joint fare of 5 cts. This order to take effect within twenty 
days after the city of Neenah shall have grunted to the Wis. 
Tr. Lt. H. ft P. Co. the right to connect its tracks with those 
of the Wis. El. Ry. Co. 

This is a proceeding instituted by the city of Neenah to com- 
pel the respondent street railway companies to establish joint 
fares for travel within the said city. The substance of the peti- 
tion is set forth in 4 W. R. C. R. 471, where the preliminary 
question of the jurisdiction of the Commission to entertain the 
proceedings, raised by the Wisconsin Traction, Light, Heat & 
Power Company, was considered and determined. Thereupon 
the respondent Wisconsin Traction, Light, Heat & Power Com- 
pany answered the petition herein. It denied all the material 
facts alleged, and averred that the compulsory establishment of 
a joint rate, whereby it would be required to carry passengers 
upon its line within the city of Neenah for less than the sum of 
f) cts., would be confiscatory and constitute the taking and appro- 
priation of its property for public use without just compensa- 
tion therefor, in violation of section 13, article 1, of the Con- 
stitution of the state of Wisconsin, and that the compulsory 
adoption of a rate of fare less than 5 cts. per passenger upon 



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CITY OF NBENAH V. WIS. TB. LT. H. & P. CO. ET. AL. 399 

its line in the city of Neenah would deprive it of its property 
without due process of law, contrary to the provisions of section 
1, article XIV, of the Constitution of the United States. 

The hearing was held at the city of Neenah on Nov. 22, 1910, 
and at the city of Madison on Dec. 14, 1910. The petitioner was 
represented by C. H. Gafftiey, its city attorney. The respondent 
Wisconsin Traction, Light, Heat & Power Company was repre- 
sented by C. M. Rosecrantz, its attorney, and the Wisconsin 
Electric Railway Company was represented by Miller, Mcrck & 
Fairchild, its attorneys. 

The cities of Neenah and Menasha, while separate municipali- 
ties, constitute in fact a single community as far as business, 
residence and social interests are concerned. E^ch has a popula- 
tion of over six thousand. The Wisconsin Electric Railway 
Company operates a line of street railway within the city of 
Neenah which extends from the city limits along Main street 
and Wisconsin avenue to Park avenue, a distance of 7,920 feet. 
The Wisconsin Traction, Light, Heat & Power Company also 
operates a line of street railway in said city which extends from 
the boundary line between said city and the city of Menasha 
along Commercial street to Wisconsin avenue, a distance of 
approximately 3,400 feet. Both of said* companies operate in- 
terurban cars over said lines. The Wisconsin Electric Railway 
Company operates an interurban line between Neenah and Osh- 
kosh, and the Wiscortsin Traction, Light, Heat & Power Comj- 
pany operates a similar line between Neenah and Appleton. 
Each company charges a fare of 5 cts. for travel upon cars 
within the city limits. The only strictly city service afforded by 
either company is that provided by the Wisconsin Electric Rail- 
way Company from Commercial street to the Park, a distance of 
about 2,500 feet. All other city service on either line is pro- 
vided by interurban cars. 

About two thousand of the population of Neenah live in the 
section of the city known as the Island, which lies north of the 
Fox River. In order to reach the main part of the city from 
the Island, it is necessary to travel over the only passenger bridge 
in the city, which is on Commercial street. The public build- 
ings, churches, depots, manufacturing plants, city parks and 
cemeteries are so situated in various parts of the city that for a 
large part of the population lo reach them by street car it is nec- 
essary to travel over both lines. The evidence is conclusive that 



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400 tlAlLBOAD COliMlSSlOK OF WlSCONSlK. 

the number of people using the lines for such purpose is small 
compared with the number that would like to use them if a 
single fare with a transfer privilege were available. As a large 
portion of the population of both cities are mechanics who work 
in the manufacturing plants, two fares are prohibitive of the use 
of respondents' lines for the purpose of going from their homes 
to their places of employment and returning. During the sum- 
mer the park, which is situated on the lake, affords recreation 
and amusement to the inhabitants of both cities. However, ac- 
cording to the testimony, most of the people visiting the park 
walk either the entire distance, or use a single line to its terminus 
and walk the remainder of the distance to their homes, because 
of their unwillingness or inability to pay two fares. The 
same is true relative to the cemeteries, public library, railroad 
depots, churches, schools and other public buildings and places 
in general. 

The Wisconsin Electric Railway Company, though apparently 
doubtful that the proposed joint fare arrangement will stimulate 
traffic to any material extent, is nevertheless willing to comply 
with any order made herein requiring the respondents to estab- 
lish a joint fare within the city of Neenah. The Wisconsin 
Traction, Light, Heat & Power Company has not entered into 
the merits of the controversy, but rests its contention upon the 
ground that its franchise granted by the city of Neenah fixes 
the rate of fare at 5 cts. for travel within the city, and there- 
fore no arrangement can be imposed upon it by which it may 
be obliged to receive less than such fare for carrying passengers 
any distance on its line within the city limits. 

The power of the Commission to vary a rate fixed in a special 
franchise granted by a municipality to a street railway company 
has been passed upon by the supreme court in the case of 
the City of Manitowoc vs, Manitozvoc & Northern Traction Co.^ 
(decided Jan. 31, 1911). Mr. Justice Barnes, speaking for 
the court, said, concerning the statute here involved: 

"It is contended that this law has superseded the contract in- 
volved in this suit and that therefore the contract no longer has 
any binding force or effect. We do not think so. The statute 
worked no change in existing rates. It simply provided that 
all rates should be reasonable, and left to the Railroad Commis- 
sion the power to determine the fact as to whether or not a given 
rate was reasonable. When that determination was reached the 
law became operative upon the particular rate called in question, 
and the rate arrived at then became the lawful rate and continued 



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CITY OF NEENAH V. WIS. TR. LT. H. & P. CO. ET. AL.' 401 

SO until set aside in the manner provided by law. The Railroad 
Commission has made no determination in the case before us ; at 
least, if it has, it is no part of the record. Until that determina- 
tion is made, the contract is in force. When it is made, the con- 
tract is superseded, if the rate is changed. The commission has 
ample authority to proceed upon its own motion. The traction 
company, imder subd. "c" of sec. 12 has power to make the 
necessary complaint to compel an investigation. This works no 
hardship on anyone. It may be, as the trial court found, that a 
10-cent fare is unreasonable and that a 15-cent fare is not so. 
Usually, long time contracts made under like conditions oper- 
ate against the public interest, and if the fare provided for it is 
unreasonably 16w, the Legislature has the same power over it that 
it would have if it were unreasonably high. It may also be that 
adequate service cannot be given at the rate fixed or that con- 
ditions have so changed that the road cannot be operated unless 
rates are increased, and that the public will be better served by 
raising the rate than by permitting it to remain where it is. This 
is a question which calls for the exercise of legislative policy and 
discretion. The court cannot relieve the defendant from an 
improvident contract, but the contract is of such a character in 
the present instance that the legislative branch of the government 
may, in the interest of the public, abrogate it. If, as is con- 
tended by counsel for the respondent, no contract was entered 
into, and we were dealing with the ordinance as a legfislative en- 
actment pure and simple, and not as part and parcel of a contract, 
there might be good reason for the claim that it is superseded 
by ch. 362, Laws 1905, without any affirmative action on the 
part of the Railroad Commission." 

There was some testimony offered to the effect that the es- 
tablishment of a joint fare between respondent companies would 
materially reduce the revenues of both companies, derived from 
local travel within the city of Neenah. This testimony was of 
necessity speculative in its nature and of little value in deter- 
mining the question at issue. If we accept the statements of 
niunerous witnesses, who testified on behalf of the petitioner as 
to the probable effect a single fare over both lines operative 
within the city would have upon travel, it would appear that a 
very great increase of traffic would likely result, which would 
augment rather than diminish the operating revenues. How- 
ever, the exact effect such change might have is not capable of 
estimation. Experience alone can diemonstrate this. From all 
the facts and circumstances disclosed upon the hearing it seems 
highly probable that there will be a substantial increase in city 
travel if a single fare be established, available from any point on 
one line to any point on the other line within the city limits. 
26— R. D. 



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402 RxMLROAD COMMISSION OP WISCONSIN. 

The necessity for a joint fare in the instant case seems to us 
to be well established, and as the respondents have failed and 
refused to agree and publish such a fare, it is incumbent upon 
this Commission to fix and establish the same. 

The only joint fare that would be practicable or capable of 
inducing any increase in travel is the customary fare of 5 cts., 
effective on most city lines of street railway in the state. If 
after a reasonable time experience shall demonstrate that such 
rate is not sufficiently remunerative for the services rendered, 
the order herein will be modified in accordance wath the facts 
as they may then appear. 

For the reasons stated in the decision of the jurisdictional 
question mentioned (4 W. K. C. R. 476), the order herein will 
be conditioned upon the petitioner granting to the Wisconsin 
Traction, Light, Heat & Power Company the right to make a 
double connection of its tracks with those of the Wisconsin Elec- 
tric Railway Company, in accordance with the approved stand- 
ard railway practice. 

Now, Therefore, it is Ordered, That the Wisconsin Trac- 
tion, Light, Heat & Power Company and the Wisconsin Electric 
Railway Company discontinue charging the present local fares 
for travel within the city of Neenah, and that they substitute in 
place of such fare a joint fare of 5 cts. 

The respondents shall comply with this order within twenty 
days after the city of Neenah shall have granted to the Wis- 
consin Traction, Light, Heat & Power Company the right to 
connect its tracks with the tracks of the Wisconsin Electric 
Railway Company in the manner a1x)ve indicated. 



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In re lake geneva water a lt. co. 403 



IN RE DETERMINING AND FIXING A JUST COMPENSATION TO 
±JE PAID TO THE LAKE GENEVA WATER AND LIGHT COM- 
PANY BY THE CITY OF LAKE GENEVA FOR THE TAKING OF 
THE PROPERTY OF SAID COMPANY ACTUALLY USED AND 
USEFUL FOR THE CONVENIENCE OF THE PUBLIC, IN AC- 
CORDANCE WITH THE PROVISIONS OF CHAPTER 499 OF 
THE LAWS OF 1907 AND ACTS AMENDATORY THEREOF AND 
SUPPLEMENTARY THERETO. 



Decided Feb. 8, 1911, 



Determination of compensation to be paid by the city of Lake Geneva 
for the water works plant of the Lake Geneva Water and Light 
Company. 

Held: That the value of such property actually used and useful for the 
convenience of the public is $86,500. 

This is an application of the city of Lake Geneva for a de- 
termination of the just compensation to be paid to the Lake 
Geneva Water and Light Company for its water works plant. 
The matter was submitted upon stipulation entered into by and 
between the city of Lake Geneva and the said water and light 
company, a hearing being waived by the parties. 

The notice of the city of Lake Geneva of its determination to 
acquire the property of the Lake Geneva Water and Light Com- 
pany actually used and useful for the convenience of the public 
in supplying it with water, shows that an agreement was entered 
into by and between the common council of said city and the 
said water and light company bearing date Sep. 30, 1910, 
wherein it was agreed that the said water and light company 
would waive the necessity, if any such necessity existed or does 
now exist, of any proceeding in court, or of any nature, for the 
purpose of condemning the plant and property of said company 
under the resolution of the common council of said city, duly 
passed on Sep. 19, 1910, whereby said city determined to ac- 
quire the water plant of said company ; that said company would 
transfer all of its right, title and interest in and to its plant 
and tangible property located in said city of I^ke Geneva, Wis., 
free and clear from any and all incumbrances whatsoever, 



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404 RAILROAD COMMISSION OP WISCONSIN. 

which property consists of the entire water plant and system in 
said city, including the going talue of said' property, and all 
stores and supplies on hand at date of transfer that can be rea- 
sonably used in the future operation of the plant; that said 
company would discharge all obligations and demands against 
it for services rendered it by its employes and other obligations 
up to and including the date of transfer, which includes, among 
other obligations, such fractional part of all taxes lawfully as- 
sessed against said company for the year beginning Jan. 1, 1911, 
as that portion of said year 1911 which has elapsed prior to the 
date of said transfer shall bear to the entire year 1911; that 
upon the physical valuation having been made of such property 
owned by said company said city shall pay to said company the 
just compensation therefor in the following manner: On Dec. 
31, 1910, or as soon thereafter as may be feasible on account 
of the sale of the bonds of said city for the purchase of said 
property, the sum of eighty-six thousand five hundred dollars 
($86,500), which is the price agreed upon by and between the 
said city and the said company. 

That the said city shall pay to the said company for the sup- 
plies and stock on hand, within thirty days after the transfer 
thereof, an amount equal to the cost value or the market value. 
That the unpaid accounts of the company which shall be due 
at the time of the transfer of the said property shall become the 
property of the said city, and said city shall pay to the said com- 
pany therefor the amount collected thereon from the water con- 
sumers on the first day of the month next succeeding the collec- 
tion thereof, and no more; and that the aforesaid agreement is 
subject to the approval of the Railroad Commission of Wiscon- 
sin in all details. 

Upon receipt of the foregoing notice, the engineers of the 
Commission were directed to make a valuation of the plant and 
report thereon to the Commission. 

On Jan. 27, 1911, the engineers filed their report with the Com- 
mission, showing the cost of reproduction of the physical prop- 
erty and the same less depreciation, or the present value thereof. 
The following summaries show in detail the results of such 
valuation : 



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In re lake geneva water a lt. co. 



405 



TABLE I. 

PHYSICAL PROPERTY OF THE LAKE GENEVA WATER AND LIGHT CO. 

Final Summary. Jancabt. 1911. 



Items. 




Cost new. 


Pres. value. 


1. Land 


roo 

9,160 
5,000 
44,109 
8,410 
7,800 

50 


S700 


2. Wells and suet ions 


8,977 


3. Elevated tank 


4.500 


4. Distribution system 


41,968 


5. Plant eQuipment 


4,0OU 


6. BulldinffH and misc. structure* 


6,200 


7. OflBce furniture I 




30 


8. Tools and Implements f " 






Total items lto8 


174,729 

vS,968 

$«3,6Si7 
500 


S66.375 


9. Add for enf^ineerintr and su 
and conting'encies, 12%. . . 


perlntendence. Interest 


7.966 








Total Items 1 to 9 


174.340 


10. Stores and supplies 


500 








Grand total items ItolO. 


184.197 


1^4.840 









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406 



KAJLKOAD COMMISSION OF WISCONSIN. 



TABLE II. 

PHYSICAL PROPERTY OF THE LAKE GENEVA WATER AND LIGHT CO. 

Detailed Summary, January, 1911. 



Items. 


Cost of re- 
production. 


Per cent 
condition. 


Present 
value. 


1. land, 

1 acre, site of plant 


$500 
200 


100 
100 

96 
90 

96 
85 
85 
75 

40 

50 
25 
50 
60 

50 
50 
50 
40 
40 
25 

85 


$500 


Part of lot— site of el. tank 


200 






Total, item 1 


roo 

$60 
3.000 

800 
5,000 

300 


$700 


2. WELLS and SUCTIONS. 

O'x 20' well - 




37'x20' well 




2-6" wells, total depth 400' 




1 12" to 6" well, 1123 ft. deep 




Suction plplnff 








Total, item 2 


$9,160 

$800 
4,200 


$8,977 


3. ELEVATED TANK AND TOWER. 

308 X aK-S" cypress tank 




Brick tower, foundation and stairway. . . 




Total, item 3 

4. DISTRIBUTION SYSTEM. 

3.419 ft. 10" main at $1.50 


$5,000 

$37,254 

2.610 

540 

3.705 


$1,500 


2,382 ft. 8" main at 1.15 




23,537* 6" main at .90 




10,312 ft. 4" main at .65 




Valves in mains 1500 


$36,509 


87 hydrants at $30 


2.220 


Services laid by company, 45 at $12 

247 meters installed, averaare $15 


459 
2,780 


Total, item 4 


$44,109 

$2,490 
200 
f>b 
150 
250 
750 
500 

1,050 
1,500 
165 
200 
400 
700 


$41,968 


5. PLANT EQUIPMENT. 

2-66" X 18' hor. tub. boilers. Installed .... 
Foundations for same 


$1,057 
200 


Boiler feed pump, 44" x 21" x 4" 


30 


Deep well pump, 9*" x 30" installed 

Simplex set condenser. 5l"x 10", installed 
Duplex power pump, 74 x 10", 
Duplex steam pump, 14"xlO"xlO" *' 
Comp. steam pump, 12"xl8"xl2"x 12" 
Installed 


75 
66 
390 
312 

557 


Williams tand. comp'd en^rlne installed 
Foundations 


790 
83 


Jack shaft, belts, etc 


80 


Piping 


160 


2 dynamos and switchboard 


200 






Total, items 


$S,410 

$6,500 
800 


$4,000 


6. BUILDINGS. 

Power and pumplnir plant and engineer's 
residence combined, (orifirlnal structure 
incl. stack ) 




2 brick additions and frame shed 




Total, item 6 , 


$7,300 
$50 


$6,200 


7. OFriGE FURNITURE ( 


$30 


8. TOOLS AND IMPLEMENTS ) 
1. STORES AND SUPPLIES. 

C. I. pipe. Specials, meters, coal, oils, etc. 




$500 


$500 



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In re lake geneva water & lt. co. 407 

In commenting upon the rapidity with which the valuation 
was made, the engineer states that "under the circumstances it 
was r<JasonabIe do assume that there would be a special tendency 
toward incompleteness of inventory, and it is suggested that this 
element would possibly warrant the making of a further con- 
tingency allowance of say 5 to 10 per cent. This latter figure 
would bring the total of the cost new to $92,617, and of the 
present value to $82,324. With the allowance of 5 the two fig- 
ures would be $88,407 and $78,582." 

We have carefully examined into the reports of the engineers 
as to the value of the physical property and all other elements 
which enter into the question of determining what is a fair 
and just compensation for the city of Lake Geneva to pay to the 
Lake Geneva Water and Light Company for the aforesaid prop- 
erty as a going concern, and from such examination we are of 
the opinion that the sum of $86,500 agreed upon by and between 
the said city and the said company is a fair and reasonable price 
for said property. 

Now, Therefore, it is Ordered, That the just compensa- 
tion to be paid to the Lake Geneva Water and Light Company 
for the taking of the property of said company, described in the 
foregoing summaries, by the city of I^ke Geneva be and the 
same is hereby fixed and determined at the sum of eighty-six 
thousand- five hundred dollars ($86,500). 

It is Further Ordered, That the terms and conditions of 
sale provided in the aforesaid agreement l)c and the same are 
hereby approved. 



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408 RAILROAD COMMISSION OP -^TSCONSIN. 



THOMAS KIRWIN et al. 

vs. 
CITY OP DARLINGTON. 



Suhmitted Jan. 13, 1911. Decided Feb, IS, 1911, 



ScTFPLEMBNTABT Obdeb. — In the Original order, made Dec. 1, 1910, the 
Darlington municipal water works was ordered to provide 
water meters for certain classes of its patrons by Jan. 1, 1911. 
In this petition the city of Darlington asks for an extension 
of time to comply with said order until July 1, 1911, and also 
that the order for the installation of meters be made more 
general. 

Ordered: That the original order for the installation of meters shall 
be extended to all users of water for manufacturing purposes 
and to certain other classes of users; that such installation 
shall be completed by May 15, 1911; that the water rates in 
efiTect up to Jan. 1, 1911, remain in effect until July 1, 1911, 
when the rates prescribed in the original order shall become 
effective; that all parts of the original order, not modified 
herein, shall become effective on July 1, 1911. 

The original order of the Commission in the above entitled 
matter, made Dec. 1, 1910 (6 W. R. C. R. 26, 43), fixed certain 
meter rates for the city of Darlington, and in addition contained 
the following provisions: 

"* * * That the respondent herein, the D^arlington munic- 
ipal water works shall, at its own expense, provide and maintain 
meters for the measuring of the water used by each of its cus- 
tomers who is connected with sewer or cess pools. * * * 

"This order shall take effect January 1, 1911." 

The respondent, the city of Darlington, in a petition dated 
Dec. 27, 1910, and served upon the petitioners Dec. 29, 1910, 
but not formally filed with the Commission until the hearing 
on Jan. 13, 1911, asked for an extension of time to July 1, 1911, 
within which to comply with the order, and asked also that 
the installation of meters be made more general than the order 
contemplated. 

The reasons for requesting more time are stated in the peti- 
tion to be: (1) That, since the order abolishes the rates pre- 
viously in effect and makes a meter rate the only lawful rate 



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KIKAVIN ET AL. V. CITY OP DARLINGTON. 409 

for most consumers, the city can collect no rentals until meters 
are installed; and inability to collect at this time will leave the 
revenues of the city about $1,200 short. (2) That the city 
now has no water meters installed and none on hand, nor suffi- 
cient funds in the treasury to purchase, at present, the 200 meters 
required, which will cost about $3,000. (3) That it is ques- 
tionable whether the city, with the plumbing force at its com- 
mand, can install the required number of meters in less than six 
months. (4) That the installation of meters will necessitate 
considerable excavating, which would be much more expensive 
in the winter and spring than in warm weather. (5) That the 
city has been on flat rates for nearly twenty years, and, while 
the city believes it is wise policy to change to the meter system, 
and intends to do so in good faith, it considers six months not 
an unreasonable time within which to make the change. (6) 
That the statements made at the former hearing as to the undue 
waste of water under the present system were grossly exag- 
gerated. 

The objection which the respondent makes to the part of the 
order requiring installation of meters only where consumers 
have -sewers or cess pools, is that such restriction results in dis- 
crimination and leaves out a number of large consumers who 
discharge their water into private drains or crevices in the rock. 
The respondent requests that this part of the order be amended 
to include customers "connected with sewer or cess pool or 
drains, and all those who use the water for operating motors 
or fans of any kind, or for bottling or any manufacturing pur- 
pose/ or for hotels, livery or boarding stables, restaurants, sa- 
loons, barber shops, bath rooms, water closets, urinals, school 
houses, churches, court house, jail, public library, or for watering 
lawns or gardens, whether or not connected with any sewer, drain 
or cess pool." 

The respondent's petition is accompanied by a statement 
signed by twenty-five of the twenty-six original petitioners, ex- 
pressing their assent to the extension of time to July 1. The 
original petitioner who did not sign this statement is a member 
of the common council, who, the respondent claims, was for 
that reason not competent to sign the petition in the first place. 

The matter was heard at the office of the Commission, Jan. 
13, 1911. The petition of the city v^as supported by Orton & 
Osborn: Carey & McDaniel appeared in opposition. 



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410 RAILROAD COMMISSION OP WISCONSIN. 

With reference to the second request of the respondent, that 
the order be made more general so that a large number of con- 
sumers may be inckided in its operation, it was explained at the 
hearing by a member of the Commission that the requirements 
specified in the order were intended as a minimum, and that the 
city is free to install meters on as many additional classes of 
service as it desires. 

On the subject of extension of time, the respondent, the city 
of Darlington, claimed that the party principally interested in 
the proceedings ^t all stages, although not a signer of the com- 
plaint, was the Darlington Electric Light and Water Power 
Company, which pumps the water for the city at a flat contract 
price and which would be benefited by the expected reduction of 
waste resulting from the immediate installation of meters. The 
city contended that since all of the original petitioners had con- 
sented" to the extension of time, with the exception of one not 
competent to be a petitioner, no other party had a right to 
enter objections to such extension. On tliis point counsel for 
the opposition to the city's petition declared that, although the 
expenses of both the original and the present proceedings were 
borne by the Darlington Electric Light and Water Power Com- 
pany, the interests of all the consumers of water in Darlington, 
and not merely the twenty-five signers of the original petition, 
were at stake, and that, they should be considered- interested 
parties. 

Proceeding to consider the petition for extension of time upon 
its merits, counsel for the city contended, and introduced some 
testimony to show, that the installation of meters would in- 
volve considerable excavation, by reason of the fact that there 
are cases where the same service pipe at present supplies two 
or more consumers, and other cases where the street cut-off 
is out of order and would have to be repaired before the con- 
sumer's water could be shut off to make the meter connection. 
It was further testified that the labor supply for making such 
excavations in freezing weather is very limited. To show the 
financial difficulty under which the city labors, a statement was 
introduced indicating that the liabilities of the city during the 
next six months will exceed the resources by about $2,000, and 
until the saloon licenses, amounting to about $4,000, are paid on 
July 1, the city will be vefy short of money. This stringency 
will be aggravated by the inability of the city to collect its water 



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KIRWIN BT AL. V. CITY OF DARLINGTON. 411 

rentals, on account of the abolition of the flat fates and the 
impossibility of collecting meter rates without meters. This 
loss the city claims to be about $1,200. The attorney for the 
city expressed his belief that it would be illegal for the city to 
borrow the funds from banks for the purchase of meters. 

Counsel in opposition to the city's petition, on the other hand, 
insisted that the rates abolished by the order of the Commission 
were discriminatory and illegal and should not continue for a 
day; that the illegal furnishing of free water to certain large 
consumers was necessitating so large a pumpage that it was 
fairly bankrupting the electric light company. Moreover, it 
was urged that lack of good faith on the part of the city was 
shown by its failure, in the six weeks between the making of the 
order and the hearing, to make any move toward compliance 
with the order as to meters ; that the city could easily obtain the 
meters on a few months' credit without resorting to illegal* 
borrowing; that most of the houses in which meters would have 
to be installed have basements and inside cut-offs, so that little 
excavation would be necessary. 

It appears that upon learning that the city desired more time 
in which to install meters, the attorney for the petitioners sub- 
mitted to the city council a stipulation according to which certain 
krge installations shouM be metered by Feb. 15, all of the 
others which are connected with sewers, cess pools, or drains, 
by April 1, and the few remaining installations by July 1, 1911. 
The stipulation also provided that the old rates might be collected 
during the first six months of 1911, subject to the further collec- 
tion of any additional charge shown by the meters on July 1 to' 
be properly due. The city did not accept this stipulation, but 
proceeded to file with the Commission its petition for an exten- 
sion of time to July 1. 

The matter of excessive waste of water was the subject of 
some testimony and argimient, for the reason that the electric 
light company's pumpage is greatly increased by such waste, if 
it exists, over what it would probably be if meters were in- 
stalled at once. The city contends that the company's com- 
plaints of great waste of water are entirely unfounded, and 
that the installation, of a more modern type of water wheel 
than the one the company now uses would go far to remedy 
whatever difficulties the company is laboring under in supplying 
the city with water. On the part of the electric light company, 



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412 RAlLfeOAD COMMlSSiOi^ of WlSCONStN. 

it was pointed out that of late it has been necessary to run the 
company's pump twenty- four-hours a day, and that owned by the 
city about eight to ten hours a day in addition, whereas three 
years ago only the company's pump was used for ten to twelve 
hours per day. It was testified also that actual measurement 
of the fall of water in the reservoir, at times when no pump- 
ing was being done, had shown an average drop, at various 
hours of the day and night, of about one foot an hour, which 
apparently amounts to over 15,000 gallons an hour or nearly 
400,000 gallons a day; that the use of water shown by these 
measurements prove conclusively that the pumps are not at fault ; 
and that the large ventilating fan installed in the public schools, 
the street sprinkling system, and a number of power users cause 
a large part of the abnormal consumption of water. 

The preliminary report upon the pumpage at Darlington, that 
has been made by the engineers of this Commission, shows that 
the theoretical discharge of the triplex pump is 208,656 gallons 
per day of twenty-four hours, and with allowance for slip 
204,483 gallons. In addition to this the simplex pump, operated 
by steam power, is in use about ten hours per day, which would 
make its theoretical pumpage 166,800 gallons. The slip of the 
triplex pump is 2 per cent, and of the simplex pump, 12 per 
cent. For purposes of this comparison no allowance has been 
made for slip, because the statistics of other plants are not in 
such shape that the amount of slip can be determined. The aver- 
age slip on all water pumped per day by 'both pumps in Darling- 
ton would amount to 5 or 6 per cent, which seems to make com- 
parison fair with other plants without allowance for slip. 

Measurement of the water used for one hour shows that the 
actual daily use is about 270,720 gallons. As we do not know 
how many days the simplex pump is in operation per year, the 
following comparisons have been made, first, assuming that it is 
in operation ten hours per day throughout the year, and second, 
that the triplex pump furnishes all the water used. Neither of 
these is correct, but they show the limits within which the fig- 
ures actually fall. 

Assuming that the simplex pump is in use every day, the total 
yearly pumpage, without allowance for slip, would be 135,518,- 
295 gallons; without considering the simplex pump, the yearly 
pumpage would be 74,636,295 gallons. The pumps work against 
a pressure of from 55 to 70 lbs., or an average static head of 



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KIRWIN ET AL. V, CITY OP DARLINGTON. 



413 



about 150 feet. The number of foi>t-gallons, considering both 
pumps, would equal 20,327,734,250, and for the triplex pump 
alone 11,195,444,250. 

The first comparison is between the costs of pumping per 
million gallons, in Darlington and in other class B plants, based 
on the 1909 reports of other plants : 



cities. 



MHUona of 

' eallODs pumped— 

all znethodB. 



Pumping cost 
per mlUlon 

gallODB. 



Spooner 

Stanley 

Sturgeon Bay 

Mazomanie 

Biver Falls ... 



MayviUe .. 
Evansville 
Washburn 
Lancaster 
Mellen 



Black River Falls. 

Oconomowoc 

Berlin 

PlattevUle 

Burlington 



Lake Geneva 

Edgerton 

DePere 

Whitewater .. 
Eaukauna ... 



Stoughton 

Orand Baplds 

Sparta 

BIpon 

Portage 



Neenah 

South Milwaukee 

Antlgo 

Stevens Point ..., 
Waukesha , 



Oconto . . . . 
Hurley .... 

MerrlU 

Baraboo .. 
Manitowoc 



Minimum , 
Maximum 
Average . 
Median . . . 
Mode 



S.66 

5.7 

6.4 

«.5 

7.5 

14.6 
16.0 
24.7 
27.4 
81.3 

46.5 
41.9 
49.5 
50.8 
54.6 

66.0 

Ti.a 

72.8 
T6.6 
80.4 

92.7 
102.2 
110.5 
140.0 
140.8 

166.2 
171.7 
182.4 
199.4 
197.8 

244.7 
255.0 
288.6 
299.1 
853.8 



9191 00 
180 73 
154 63 
38 39 

103 32 

102 55 
81 67 

132 75 
J.-4 21 
23 32 

42 2.-1 
SO 04 

48 33 
88 19 
64 54 

52 68 
83 67 
29 30 
25 73 
47 71 

47 17 
29 77 
83 67 
19 98 
88 29 

28 21 
41 25 
19 05 

27 87 
55 11 

85 47 

49 28 

28 57 
; 663 
; 10 67 

.1 6 63 

191 00 
57 81 
41 25 

. I About 30 00 



Darlington: 
Triplex pump only. 
Both pumps 



74.6 

135.5 



12 06 
664 



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414 



RAILROAD COMMISSION OP WISCONSIN. 



Both of these figures covering the cost of the Darlington pump- 
age are .low in comparison with other plants. The actual pump- 
age is probably in the neighborhood of 100 million gallons, 
which would make the cost per million gallons $9. We have 
the steam pumping expenses per million foot-gallons for thirty- 
five plants. The data relating to pumping by means other than 
steam are so scant that any comparison other than with steam 
power is unsatisfactory. Following is the table: 



Cities. 



Millions 

of foot- 

galloDS pumped. 



Pumping ezpenie 

per million 

foot-gallons. 



Sturgeon Bay .. 

Evansville 

Chippewa Palls 
Oconomowoc ... 
Belolt 



Berlin 

Burlington . . 
Edgerton ..»,. 
Lake Geneva 
Kaukauna ... 



Whitewater 
Waukesha . 

Sparta 

Neenah 

Antigo 



Portage 

Oconto 

Merrill 

Stevens Point 
Appleton 



Green Bay ... 
Beaver Dam , 
Fond du Lae. 
Watertown . . 
Manitowoc . . . 



Janesville 
Ashland .. 
Oshkosh . 
Marinette 
Superior . 



Sheboygan 

Bacino 

La Crosse 
Kenosha ... 
Milwaukee . 

Minimum . 
Maximum . 
Average . . . 
Median .... 



Darlington: 
Triplex pump only. 
Both pumps 



807 
2.240 
2.513 
4.814 
6.518 

6,678 
8.918 
11.452 
12.166 
12.464 

13,154 
15.085 
15.135 
15,824 
16.414 

21.119 
22.613 
31.163 
33.270 
38,704 

40.014 
42,582 
44.361 
52,472 
56.533 

60.981 
65,307 
93,188 
93.406 
96.536 

100.480 
183.270 
202.215 
300.316 
1.855.894 



11.195 
20,328 



$110 
.58 
.23 
.26 
.84 

.36 
.43 
.21 
.28 
.32 

.15 
.72 



.21 



.25 

.16 

.17 

.28 

.11 
.11 
.18 
.07 

.11 
.12 
.14 
.08 
.16 

.06 
.C8 
.08 
.07 
.05 

.05 
1.10 
.267 
.21 



.08 
.044 



Digitized by VjOOQIC 



KIRWIN ET AL. V. CITY OP DARLINGTON. 



415 



From the above it will be seen that pumping expenses for 
Darlington per million foot-gallons are extemely low by com- 
parison with plants which perform the same amount of work in 
pumpage. If we assume an annual pumpage of 100,000,000 
gallons, the number of foot-gallons amounts to 15,000,000,000, 
or the expense to 6 cts. per million foot-gallons, lower than 
any of the above plants except Milwaukee. From 25 to 30 cts. 
per million foot-gallons appears to be typical cost for plants 
pumping the same number of foot-gallons as the Darlington 
t)!ant. 

The facts relating to pumpage per inhabitant are as follows : 



Table from First Darlini^^ton Decision. 

PUMPAGE STATISTICS, TEAR KNDINQ JUNE 30, 1910. 



City. 







• 


M 




M 


gallons 


Population, 


gallons per 


pumped. 


1905. 


Inhabitant. 


2.199 


612 


8.6 


8,650 


800 


4.6 


6,500 


863 


7.5 


lO.A-X) 


903 


12.1 


9,110 


COS 


10.1 


3.069 


1.0-3 


2.9 


14,000 


1,096 


13.3 


2,650 


1.103 1 


3.3 


]2,00<) 


1,106 


10.9 


9.125 


1,153 


7.9 


32.8-;0 


1 -.002 


20.5 


9.825 


1,720 . 


6.7 


16,000 


1,963 


! 8.1- 


36,500 


1.946 , 


18.8 


31,348 


1,700 1 


1 18.4 


87, -^OO 


1,857 


47.1 


14.639 


1,793 


1 8.2 


9,000 ■ 


1,450 


6.2 


41.277 


2,676 


1 15.5 


54,360 


2,625 


20.8 


71,577 


2,416 


59.7 


27, .^JT.-) 


2,555 


10.7 


10.540 


2.117 


1 5.0 


5.700 


2.722 


2.1 


86,180 


2.873 


CO.O 


42,647 


2,913 


14.7 


75,000 


3,300 


22.7 


145,30.-, 


3,220 


45.2 


6.'>.000 


3,449 


18.8 


41.8r.2 


3.013 


13.9 


139,971 


3,811 


1 86.7 


iio.4nr> 


3.807 


».o 


60.000 


3.008 


1 20.0 


54.7:.o 


3.111 


1 17.6 


75.(i0a 


1 3.108 


1 24.3 



St. Croix Palls 

Glldden 

Mazomanlc 

Bocton 

Glenwood 

Fennlmorp 

LodI 

Spring Valley 

Onalaska 

Shullsburg 

Lake Mills 

Ladysmlth 

EvansvIUe 

Black River Falls., 
Mellen 

Maiiston 

Mayvllle 

Mondovl 

Bayfield 

Burlington 

Edgerton 

Lancaster 

NelllsvIUe 

Stanley 

Waupaca 

Wauwatosa 

Port Atkinson 

Hudson 

Lake Geneva 

Oconomowoc 

RIpon 

Sparta 

Toniah 

Waupun 

Whitewater 



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416 



RAILROAD COMMISSION OP WISCONSIN. 



PUMPING STATISTICS. YEAR ENDING JUNE 30. IPIO.— Concluded. 



City. 



M 

gallons 
pumped. 



Population, 
1905. 



M 

gallons per 
inhabitant. 



Berlin 

De Pere .. 
Kaukauna 
Monroe . . . 
PlattevIUe 



Port Washington 

Stoughton 

Washburn 

Portage 

South Milwaukee . 



Baraboo 

Beaver Dam 

Menasha 

Menomonie . 
Oconto 



Antlgo 

Grand Baplds 

Neenah 

Waukesha 

Watertown ... 



Merrill 

Stevens Point 

Belolt 

Manitowoc .... 
Janesvllle 



Wausau , 

Ashland , 

Marinette .... 

Appleton 

Pond du Lac 



Green Bay 
Madison . . 
La Crosse 
Oshkosh . . 
Racine — 



Superior 



Cities under 5,000: 

Average 

Maximum 

Minimum 



Cities over 5,000: 

Average 

Maximum 

Minimum 



An cities: 
Average .. 
Maximum 
Minimum 



Darlington: 

Triplex pump onl7«< 

Both pumps 

Probable pumpage . 



49,471 
72,800 
80,420 
75,000 
50,771 



288.556 
193, 48« 
729,615 
353,887 
858,419 

eoo,ooo 

482,504 
594,949 
586,166 
778,270 

488,057 

608,011 

1,094.838 

1,096,337 

939.819 

615,857 



74,636 
135,518 
100,000 



4,638 
4.523 
4.991 
4,229 
4,438 



9,197 
9.022 
12.856 
12.733 
13,770 

9,197 
9.022 
12,855 
12.733 
13.770 

22.854 
£4.301 
29,078 
80,576 
82.290 

S6,551 



1,843 



10.7 
16.1 
16.1 
17.7 
U.5 



60,97.-. 


4.036 


15.1 


92, 690 


4,244 


21.8 


24.750 


4,924 


6.2 


140,795 


6,624 


25.5 


171,747 


6,284 


82.5 


2f9.0S8 


5,835 


51.3 


802,000 


5,615 


53.8 


79,000 


5,960 


13.2 


63,403 


5,473 


11.6 


244.735 


5,722 


42.8 


182.379 


6.668 


27.3 


102.187 


6.157 


16.6 


156.240 


6.047 


25.8 


197.752 i 


6,949 


28.5 


291,513 1 


8.622 


33.8 



81.8 
21A 
6S.6 
27.7 
26.1 

81.3 
21.4 
66.6 
27.7- 
26.1 

18.9 
250 
87.6 
85.8 
29.0 

16.9 



16.6 
47.1 
2.1 



81.4 
56.6 
11.6 



21.9 
66.6 
2.1 



40.5 
73.5 
54.8 



Digitized by VjOOQIC 



KIRWIN ET AL. V. CITY OF DARLINOTON. 



n1 



The pumpage per inhabitant is thus far above the average, 
even of the larger plants, and extremely high by comparison 
with plants in small cities. From these figures it appears that 
the pumpage is extemely high, indicating waste and excessive 
use, and the cost per unit, to the city, is very low. By com- 
parison with costs to other plants the electric company, which 
does the pumping, is receiving a very low return. 

While the above figures as to pumpage and the cost of the 
same are not absolute, they are not so far out of fhe way that 
they do not show with approximate correctness the relations 
which obtain between, the situation in Darlington and the situa- 
tion in the other places named. That in places where meters arc 
not in use there usually is an enormous as well as an unreason- 
able waste of water, is so well established by experience as to need 
no further explanation. 

The above facts throw a great deal of light upon the pump- 
ing situation in Darlington. When considered in connection 
with certain other facts that are available upon this subject, 
some of which have already been presented in other decisions, 
they indicate that under present conditions this pumping is a 
serious burden to the Darlington Electric Light and Power Com- 
pany. For there seems to be no doubt about the fact that the 
cost to this company of pumping the water is considerably 
greater than the amount it receives therefor under its contract 
with the city. From what is well known of such matters, it is 
also evident that the installation of meters would greatly re- 
duce the pumpage in question and that this reduction, in turn, 
would tend to considerably lower the cost of this pumpage to 
the electric company. In view of all this, it seems to us that 
the electric company can hardly be blamed for desiring the in- 
stallation of meters at the earliest possible date. Nor do we see 
any equitable grounds upon which the city is justified in delaying 
this work any longer than is absolutely necessary. 

At the same time it appears to be a fact that considerably 
more time is required for the installation of the meters than 
that which was allowed therefor in the original order. In the 
first place, a certain amount of time is needed in deciding upon 
what make and what sizes of meters will be suitable under con- 
ditions such as those which prevail in that city. Certain addi- 
tional time is also consumed in their purchase and for their 
transportation. The actual installation of meters is always slow 
27— R. D. 



Digitized by VjOOQIC 



418 RAILROAD COMMISSION OP WISCONSIN. 

work, even where most of the houses have basements or frost- 
proof places where the meters can be placed'. In fact, this 
part of the work is not only slow^ but quite costly, and of such 
nature generally as to require a great many changes and read- 
justments in the service connections and in other respects. But 
while all this is true, we are inclined to think that the city has 
asked for more time in which to install the meters than is actu- 
ally needed or in which it can conveniently complete the work. 

That the meters should be installed and' operated at the earliest 
possible date is necessary, not only on equitable grounds, but in 
order that their readings may furnish a" basis upon which to 
collect the water rentals for the six months beginning July 1, 
1911. It is obvious that imless the meters have been in actual 
operation for some time previous to this date, the city will be 
without any reliable basis upon which to collect the rentals for 
the six months' period which begins on that date. 

It is Therefore Ordered, That the order of this Commission 
of Dec. 1, 1910, be modified as follows : 

That the city of Darlington, or its municipal waterworks, shall 
at once proceed with the installation of meters for all customers 
of its water works who are connected with sewer or cesspool or 
drains, and all those who use the water for operating mQtors or 
fans of any kind, or for bottling or any manufacturing pur- 
pose, or for hotels, livery or boarding stables, restaurants, sa- 
loons, barber shops, bath rooms, water closets, urinals, school 
houses, churches, court house, jail, public library, or for water- 
ing lawns or gardens, whether or not connected with any sewer, 
drain or cesspool, and that this work of installation shall be 
completed by May 15, 1911. 

That the city keep accurate records of the reading of each 
meter from the date on which it is installed and placed in opera- 
tion until July 1, 1911. 

That the water rates which were in effect up to Jan. 1, 1911, 
shall remain in effect until July 1, 1911, when the rates pro- 
vided in the former order shall go into effect. 

That all parts of the order of this Commission dated Dec. 1, 
1910, which are not modified by the present order shall go into 
effect July 1, 191J, 



Digitized by VjOOQIC 



In re appl. wautoma & mt. morris farmers' tel. co. 419 



IN RE APPLICATION OF THE WAUTOMA AND MT. MORRIS 
FARMERS' TELEPHONE COMPANY FOR AUTHORITY TO IN- 
CREASE RATES. 



Decided Feb. 15, J911. 



Applicant alleges that it has recently installed many improvements, 
thereby greatly increasing the service, both as to the number 
of subscribers and the quality of service; the application for 
authority to increase rates applies only to those subscribers 
receiving the better class of service. Applicant is authorized 
to substitute the rates prayed for for those now in effect. 

The application in this matter was filed with the G>mmission 
Dec. 39, 1910. The applicant, the Wautoma and Mt. Morris 
Telephone Company, a corporation organized and doing business 
under the laws of the state of Wisconsin, with its principal place 
of business in Wautoma, Wis., is a public utility engaged in 
the management and operation of a telephone exchange and rural 
lines. The application sets forth diat the rates of said com- 
pany at present in force, are as follows: 

Business 'phones, single or pafty lines, $1.00 per month. 

Residence 'phones, single or party lines, $1.00 per month. 

The applicant asks authority to increase its rates for the rea- 
son that the local exchange of the village of Wautoma has been 
rebuilt throughout, by putting in new poles, new cable and new 
switchboard, and by building new rural lines, greatly increasing 
the service, both as to the number of subscribers and the quality 
of service. 

The rates which the applicant desires to put into effect are as 
follows : 

Single line business 'phone, $1.50 per month. 

Business 'phone and one residence 'phone on same line, for 
same party, $2.50 per month. 

Single party residence 'phone, $1.25 per month. 

Residence 'phone on party line, not to exceed four parties on 
one line, $1.00 per month. 

Extension 'phones, 50 cts. per montli. 



Digitized by VjOOQIC 



420 RAILROAD COMMISSION OP WISCONSIN. 

Extension bell, 10 cts. per month. 

Rural lines, $15.00 per year. 

The hearing was set for Jan. 17, 1911, but no appearances 
were made. The applicant states that it has operated the lines 
and exchange involved in this application only since July 1, 

1910. For the period prior to July 1, 1910, no reports have 
been made to the Commission. 

It appears from the inventory of the property involved that 
its cost new is $13,627, which is equivalent to about $61.70 per 
subscriber and about $82,30 per mile. Although this valua- 
tion is slightly in excess of the average for plants similar to 
the one in question, there appears to be no reason to question 
the amount as given above. As the financial history of the 
exchange, prior to July 1, 1910, is unknown, no estimate can 
be made of other items which might affect the value, but for 
the purposes of this decision it appears best to consider the 
cost new as given above as being the actual value of the prop- 
erty. 

The only report which we have concerning the financial con- 
dition of the applicant is that submitted under date of Feb. 3, 

1911, and covering the six months' period from July 1, 1910 
to Jan. 1, 1911. This report shows the receipts and expenditures 
for that period to have been as follows : 

Receipts: 

From village exchange, 61 subscribers ^ $366 00 

From rural lines, 64 subscribers, for six months 500 00 

From rural lines, 17 subscribers, for four months 85 00 

From rural lines, 11 subscribers, for one month 13 75 

Commission on toll business 60 00 

Total receipts |1,024 75 

E\P£'N0iTUBE8 : 

Manager's salary $210 00 

Day operator 180 00 

Night operator 72 00 

Maintenance, livery, officers and directors 175 00 

Total $637 00 

The letter of the applicant, submitting this report, states that 
the above figures are substantially correct. They do not rep- 
resent conditions exactly. An examination of the statement of 
receipts indicates that the rates which the application states are 
in force at present do not apply to subscribers who are on 
rural lines, but it appears that the rate for this class of service 



Digitized by VjOOQIC 



In re ai'PL. wautoma & mt. morris farmers* tel. co. 421 

is $1.25 per montli. This does not correspond exactly with the 
item of $500, reported earnings from 64 subscribers for six 
months. At $1.25 per month this would amount to $480, and in 
order to produce a revenue of $500, the rate would need to be 
$1,302 1/12 per month. In view of the fact that the figures 
submitted are represented as only substantially correct, it seems 
certain that the rate is $1.25 per month, at which rate the 
amounts received from other rural subscribers are correctly 
stated. The applicant states that there are at present 221 
subscribers, of whom 87 are in the village and 134 on rural 
lines. With a rate of $1 per month in the village and $1.25 
per month on rural lines, the annual revenue from subscribers 
will be $2,954. If we add to this $120 annual revenue from 
commission on toll business, we find the total annual revenue 
to be $3,074. 

On the basis of the six months reported, the expenses of the 
applicant for the year will be $1,274, or $5.77 per subscriber per 
year. It appears, however, that the number of subscribers has 
increased considerably during the latter part of the six months* 
period for which report was made. The operating expenses, 
then, based on the present number of subscribers, may be ex- 
pected to amoimt to more than $1,274 per year. It is impossible 
to state what the amount of these expenses will be, but it does 
not seem that the increase need be considerable. Salaries and 
wages would apparently remain at about the present point. 
The application does not show that any increase in expenses is 
anticipated, but there is no question that maintenance expenses 
will be increased. If we assume that annual operating expenses, 
will increase to $1,350, we find the expense per subscriber to be 
$6.11. Although comparison with other plants will not show 
exactly what. operating expenses should be, such comparison will 
show, in a general way, the limits within which operating ex- 
penses may be expected to fall. Comparison with 47 telephone 
utilities in Wisconsin, operating under substantially similar con- 
ditions, shows that the amount of $6.11 per subscriber is a rea- 
sonable expense. Some utilities have a much higher expense, 
and others considerably lower, but a very large part of them 
have expenses of from $5 to $7 per subscriber. In the absence 
of exact data covering any considerable period, the amount of 
$1,350 for operating expenses appears to be the best estimate 
that can be made of normal operating expenses. 



Digitized by VjOOQIC 



422 RAILROAD COMMISSION OP WISCONSIN. 

The ordinary life of the equipment of a telephone utility is 
about fifteen years. This means that depreciation should be 
provided for at the rate of about 6V1» per cent. In the absence 
of local conditions which may necessitate a different rate, in- 
terest and profits are usually provided for at the rate of 7 per 
cent on the value of the property. As far as we are able to 
determine, there arc no conditions affecting the use of the prop- 
erty of the applicant which would necessitate any change from 
this rate. 

The total expenses which the company has to meet, therefore, 
appear to be about as follows : 

Expenses of operation SI, 350 00 

Depreciation, 6% per cent on $13,627 885 76 

Interest, 7 per cent on $13,627 953 89 

Total expenses $3, 189 64 

Just what effect the proposed increase would have on total 
earnin^^s cannot be stated, as we have not been furnished with a 
statement of the number of subscribers in each class. As the 
rate for subscribers on rural lines is not changed, it is evident 
that only those 87 subscribers who are in the village will be 
affected. From this number should be deducted those who are 
on party lines, as the rate for these remain the same. The pur- 
pose seems to be to increase rates for that class of patrons who 
are receiving especially good service. If we assume that the 
average rate in the village is increased 25 cts. per month, the 
total increase of revenue will be $261 per year. As some of 
these 87 patrons are on party lines, and as the increase for sin- 
gle party business 'phones is $6 per year, it is not likely that 
$261 will be the actual increase. It will probably be less than 
this amount, depending, of course, on the number of subscribers 
affected. Probably $200 per year is about the correct figure. 

This will increase revenues per year to $3,274, or $84.36 in 
excess of the estimated expenses. In view of the facts that 
this excess is very small, and that the expenses as estimated are 
slightly below the average for similar companies, and that the 
increase applies only to those subscribers receiving the better 
class of service, we are of the opinion that the increase should be 
allowed. The proposed rate for extension 'phones and for ex- 
tensions bells cannot be expected to yield any considerable reve- 
nue. It is quite common practice to charge for these in addi- 



Digitized by VjOOQIC 



In re appl. wautoma & mt. morris farmers' tel. co. 423 

tion to the regular charge for service, and the rates proposed 
do not seem unreasonable. 

The Applicant in this case, the Wautoma and Mt. Morris 
Farmers' Telephone Company, Is Therefore Authorized to 
discontinue its present schedule of rates, tolls, and charges, and 
to substitute therefor the following schedule: 

Single party business telephone %1 50 per month. 

Business telephone and residence telephone on one 

line, for same party 2 50 " 

Single party residence telephone 1 25 " 

Residence telephone on party line, not to exceed four 

parties on one line 1 00 " 

Extension telephones / 50 " 

Extension bells 10 

Telephones on rural lines 15 00 per year. 



Digitized by VjOOQIC 



424 RAILROAD COMMISSION OP WlSCONStN. 



mLWAUKBE, SPARTA AND NORTH WESTERN RAILWAY COM- 
PANY 
VB. 
TOWN OF LEBANON. DODGE COUNTY. 



Bubmitted May 10, 1910. Decided Feb. 16, 1911, 



Petition alleging that petitioner's double-track line of railroad, now in 
process of construction, will cross a public highway running 
east and west in the town of Lebanon, Dodge county, at a 
point where the grade of the railroad is elevated to such an 
extent that it is impracticable to make a grade crossing of the 
highway with the railroad; that the railroad and the high- 
way intersect at such an angle as to necessitate the building 
of a bridge 350 feet in length. Petitioner prays that a part 
of the present highway be closed and that a new highway be 
opened south thereof, from the intersection of the railroad to 
the intersection of a highway running north and south, where 
the highway can be carried across said railroad tracks by 
means of an overhead bridge. A map showing the location of 
the present and the proposed highway was filed by the peti- 
tioner. 

Held: That the plan proposed by the petitioner is practical; that it is 
necessary to abandod the present crossing and to divert the 
highway for a short distance. It is so ordered, the peti- 
tioner providing the land required for the re-location of said 
highway and assuming all expense? incident to the construc- 
tion of the sam6. 

The petitioner is a railway corporation organized under and 
pursuant to the laws of the state of Wisconsin, and is duly 
authorized to construct a line of railroad from a point in Mil- 
waukee county, near its western boundary,. to a point about a 
mile north of the village of Clyman, in Dodge county, and from 
that point in a north-westerly direction to the village of Necedah, 
in Juneau county; that it is actually engaged in the construction 
of said line of railroad; that the same has been located and 
staked out and profiles thereof made ; that said proposed line of 
railroad passes through the south-west quarter of the south- 
west quarter of section 9, and the north-west quarter of the 
north-west quarter of section 16, all in town 9 north, of range 
16 e^st, in Dodge county; that between said two above described 
parcels of land there is located and opened and used a public 



Digitized by VjOOQIC 



MILW. SPARTA A N. W. R. CO. V. TOWN OP LEBANON. 425 

highway, two rods in width, which highway is crossed by the 
proposed line of railroad of the petitioner, and that at the point 
of crossing the grade of said railroad is elevated to such an 
extent that it is impracticable to make a grade crossing of the 
highway with the railroad of petitioner; that if the highway 
remains in its present position, it will be necessary to have a 
crossing underneath the railroad of .the petitioner; that sa:d 
railroad will be a double track line, and that at the highway afore- 
said the railroad and highway intersect at such an angle that 
if the highway should be bridged along the line thereof, the 
length of said bridge or tunnel would be in the neighborhood 
of 350 feet, and would be dangerous to public safety; that it 
is impossible to carry the railroad over said highway in its 
present location without making the highway dangerous for 
public travel, and in order to obviate such danger, it is necessary 
that there should be an alteration in said crossing, its approaches 
and the method of crossing, and also in the location of the 
highway so to be crossed, and for that purpose it is necessary 
to close the present highway at a point where it is crossed by 
the proposed railroad of petitioner and to substitute therefor a 
crossing easterly thereof, not at grade; and for that purpose it 
is necessary to lay a highway on the south side of the proposed 
railroad of the petitioner, 66 feet from the highway first 
above mentioned, to a highway running north and south along 
the east side of the two parcels of land above mentioned; the 
north and south highway hereinbefore referred to, and which 
lies on the east side of the two parcels of land first above men- 
tioned, is only one rod in width; that it is proposed to carry 
the highway across said railroad by means of an overhead 
bridge; that in order to do so, the petitioner proposes to con- 
struct said overhead crossing of a width of 24 feet, and in order 
to construct said bridge and the approaches thereto it is neces- 
sary to change the course of said north and south highway 
slightly to the west: that a grade crossing at said north and 
south highway would be highly dangerous ; that petitioner is the 
owner of all the land that is necessary to be acquired in order 
to make said proposed highway changes ; that in order to make a 
change in the east and west highway first above mentioned, peti- 
tioner is willing to deed to the town of Lebanon the land neces- 
sary for said highway, and offers for such purpose a strip of 



Digitized by VjOOQIC 



Ir26 RAa.ROAD COMMISSION OP WISCONSIN. 

land described as follows : A strip of land of the uniform 
width of 66 ft., south of and adjoining the right of way of the 
Milwaukee, Sparta & North Western Railway Company, as the 
same is now located and staked out across the north-west quarter 
of the north-west (Juarter of section 16, town 9, range 16 east. 

Petitioner offers, for the purpose of changing the north and 
south highway aforesaid, land of which it is the owner and 
described as follows : A strip of land in the south-west quarter 
of the south-west quarter of section 9, town 9 north, range 16 
east, of the uniform width of 66 ft., being 33 feet on each side 
of a center line described as follows: Commencing at a point 
on the south line of said tract of land 73 ft. west of the south- 
east corner thereof, and running thence north-easterly to a point 
on the east line of said tract 125 feet north of the south-east 
corner thereof; also all that part of the north-west quarter of 
the north-west quarter of section 16, town 9, range 16 east, 
which is described as follows : A strip of land 66 feet in width, 
being 33 feet on each side of a center line, which center line is 
described as follows: Beginning at a point on the north line 
of section 16, town 9, range 16 east, 82.5 ft. west of the north- 
east comer of the north-west quarter of the north-west quarter 
of said section 16, running thence south on a line parallel to the 
east line of the north-west quarter of the north-west quarter of 
said section, 251.5 ft, thence south-easterly to a point on the 
west line of the one rod highway, as now laid out, on the east 
line of the north-west quarter of the north-west quarter of said 
section, which is 430 ft. south of the north line of said section 
16. 

Wherefore, the petitioner prays that the mode and manner 
of making the highway crossing aforesaid, the location of any 
highways necessary to be laid or altered, and what portion, if 
any, of the highway crossed by the railroad of the petitioner 
shall be closed, be determined, and that petitioner may have 
such further and other order as the Commission may deem 
just and best in the premises. 

The respondent, answering the petition, alleges that said peti- 
tionier has twice heretofore;, within a period of six months pre- 
ceding the filing of its petition herein, filed petitions with the 
town board of the town of Lebanon in accordance with sec. 1265 
of th^ Statutes of 1898 and acts amendatory thereof pind sup- 



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MILW. SPARTA & N. W. R. CO. V. TOWN OP LEBANON. 427 

plenientary thereto, praying for a discontinuance of that part 
of a certain highway in the town of Lebanon between the north- 
west quarter of the north-west quarter of section 16, and the 
south-west quarter of the south-west quarter of section 9 in the 
town of Lebanon, Dodge county. Wis., which Hes east of the 
proposed railroad, and offering to deed to the town of Lebanon 
a strip of land lying south-easterly of its proposed railroad, 
from a point where the above said highway comes up to and 
crosses said proposed railroad, and extending south-easterly to 
a highway in said town running north and south along the east 
side of the north-west quarter of the north-west quarter of sec- 
tion 16 and the south-west quarter of the south-west quarter 
of section 9 aforesaid, for highway purposes, and to build an 
overhead crossing over said railroad on said north and south 
road ; that each time the said town board of the town of Lebanon 
duly acted upon said petitions and unanimously decided against 
the prayer of the petitioner therein ; that in neither of said pro- 
ceedings said Milwaukee, Sparta & North Western Railway Com- 
pany has appealed from the refusal of the town board to grant 
the prayer of the petitioner, as provided by. sec. 1276 of the Stat- 
utes of 1898; that the closing of a part of said east and west 
road, as proposed by said' railway company, would very much 
inconvenience and prejudice the rights of a large mass of the 
general public who have for a long period of years enjoyed the 
benefits and privileges of said public east and west highway in 
coming from the territory north of said proposed closed road, 
in coming to Lebanon and the city of Watertown and other 
places, as it w^ould' necessitate the general public to extend a 
distance of about 20 rods farther south and then return towards 
the west along the southerly side of said proposed railroad in 
getting back to the usual and regularly traveled public highway, 
or to proceed in a southerly direction upon roads in poorer con- 
dition in going to Lebanon and Watertown ; that at the time of 
said hearing of said two petitions by said town board of the 
town of Lebanon, the residents of the town of Lebanon were 
largely represented, and said general public protested and re- 
monstrated against the discontinuing of said part of said east 
and west road, and against the accepting of the land proposed 
by said railway company to be deeded to the town of Lebanon 
for a substitute road along the southerly side of said proposed 
failwaj^, and further protested against being required to cross s^icl 



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428 RAILROAD COMMISSION OP WISCONSIN. 

proposed railroad on said east and west road at the elevated 
grade proposed by said railway company, and requested and 
demanded of said town board to compel said railway company 
to construct its said proposed railway over and above the regu- 
lar grade of the highway, so that the general public might travel 
beneath said railroad at or about the present grade of said road; 
that at the time said railway company purchased its right of 
way from the farmers, residents and' property owners of the 
town of Lebanon in the vicinity of said crossing, the represen- 
tatives of said railway company promised said residents and 
property owners that it, the said railway company, would con- 
struct its railway so as to give the general public an under- 
way beneath said railroad tracks at said east and west road 
crossing; that said town board of the town of Lebanon received 
no notice of any application on part of the petitioner herein 
for a permit to construct and operate a railroad through the 
town of Lebanon or across any of the roads of said town; that 
in the opinion of respondent, based upon a careful investigation 
of the circumstances, surroundings, lay of the land and general 
interest to the public, no part of said east and west road should 
be discontinued, and that in the interests of the general public 
said railway company should be require'd to, by a slight varia- 
tion of the course of said east and west road, as authorized 
by law, provide the general public with an underneath passage- 
way beneath the tracks of said railway company, and that said 
railway company should provide the general public with a safe 
and sufficient overhead crossing or bridge above the tracks of 
said railway company on said north and south road. 

Wherefore, respondent respectfully protests and objects to 
the Railroad Commission of Wisconsin assuming any jurisdic- 
tion in the discontinuing of any part of said east and west road, 
and further protests against the Railroad Commission of Wis- 
consin assuming any jurisdiction in the ordering of the laying 
out of the proposed substitute road of said railway company 
on and along the southerly side of the right of way of said rail- 
way company in the north-west quarter of the north-west quar- 
ter of section 16, town of I^banon, Dodge county, Wis., or at 
any other location, and respondent respectfully asks that the 
Railroad Commission of Wisconsin require said railway com- 
pany to provide the general public and the residents of the town 
of Lebanon with a safe, substantial and convenient overhes^c} 



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MILW. SPARTA & N. W. B. CO. V. TOWN OP LEBANON. 429 

bridge crossing over the tracks of said railway company on said 
north and south road, and with an underway crossing beneath 
the tracks of said railway company on said east and west high- 
way in said town of Lebanon. 

The matter came on for hearing on May 21, 1910. S. T. 
Swanson appeared for petitioner, smd Kading & Kading for the 
respondent. 

According to the plat* introduced by the petitioner, showing 
the proposed change of highway, it appears that the road in 
question now runs east and west and crosses a highway run- 
ning north and south 1,000 ft. west of where the railroad pro- 
poses to cross the existing highway. The railroad also crosses 
the north and south highway a short distance south of the inter- 
section of said two highways. The highway running north and 
south will be separated from the grade of the railroad by an 
overhead crossing. It is proposed to change the east and west- 
highway so that it will intersect the north and south highway a 
short distance south of the present intersection of said two high- 
ways, and thus, obviate one crossing of the railroad. In this 
way the travel over the east and west highway, as well as that 
over the north and south highway, will pass over the overhead 
crossing of the north and south highway. The proposed line of 
railway crosses the east and west highway on an angle of 15 
degrees, making a rather long crossing. In order to escape 
the necessity for la long tunnel on this location, as well as an 
extra crossing, the plan in question was adopted. Persons going 
east or west over the highway as diverted would be obliged to 
travel an extra distance of 300 feet. It is conceded' that a tun- 
nel crossing which would be between 250 and 300 feet in length, 
would be exceedingly dangerous to those traveling upon the 
highway. This tunnel would require support in the center 
of the highway, and would be dark unless lighted by artificial 
means. 

The respondents interposed numerous objections to the pro- 
posed plan. It is asserted that the proposed new highway 
would be unsafe on account of its close proximity to the railroad 
track. This objection does not appear to be well founded, as 
the old highway is also near the railroad track, and the proposed 
highway would be no more objectionable than the present high- 
way. It was also said that the overhead bridge is dangerous on 



•Plat not reproduced here. 

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430 RAILKOAD COMMISSION OP WISCONSIN. 

account of teams becoming frightened by the smoke of passing 
trains, and that therefore an under-passageway would be much 
the safer. The question as to whether an overhead crossing 
or an underway is the safest, is one which has been given con- 
siderable attention, both kinds of crossings being commonly used. 
It would api^ear that the advantages and disadvantages of the two 
kinds of crossings arc about equal. About 80 per cent of the im- 
portant highway crossings of this proposed railway have been 
placed either above or below the railroad tracks, no special at- 
tention being given to either class, the character of the crossing 
depending entirely upon the local conditions. One of the objec- 
tions to an overhead crossing is, that in the winter time the snow 
is usually blown off, leaving the crossing bare and making it 
difficult to haul heavily laden sleds over the same, but a similar 
condition would also exist in the long underway crossing, or any 
underway crossing, as no snow could reach the highway under 
the bridge. As to the increased distance which wouki be required 
for the teams traveling from the north to a factory that is lo- 
cated near the town of Lebanon on the east and west road, it 
may be stated that this increased distance is but about 300 feet. 
The travel over the existinf^- road is comparatively light, as the 
country is not thickly settled, there being only some five or six 
farmers who make regular trips from the north to the factory. 
The fact that it has been necessary to haul all the grain from this 
territory, a distance of some seven or eight miles, to the nearest 
railroad station, w^hile with the construction of the new railroad 
this haul will be reduced by several miles, has apparently not 
been given consideration by the farmers who object to the in- 
creased distance they are obliged to travel in going to and from 
the factory mentioned. 

It was proposed upon the hearing to make a "blind" crossing. 
This would be accomplished by diverting the road along the north 
of the right of way a short distance and then crossing directly 
south underneath the tracks of the railway to the south of the 
right of way, and then running in an easterly direction, uniting 
with the existing east and west highway, a short distance east of 
such crossing. This, however, is objectionable on account of 
teams approaching frcm opposite directions being unable to see 
each other until practically at the meeting point. This would be 
especially undesirable, because dangerous in the case of automo- 
biles. iMirtberniorc, the cost of a crossing of this character 
would exceed $15,000. 



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MlLW. StAUtA A N. W. R. CO. V, TOWi^ OP LfiBANON. 43l 

It has also been suggested that in case only one crossing is 
provided, that the location of the bridge on the north and south 
highway be changed, so as to reduce the added distance about 
200 feet. Such a change in location would increase the cost of 
the bridge and highway approximately $4,000. It does not ap- 
pear that the advantages gained would be sufficient to justify this 
additional expense. The conditions are not such as to justify 
the providing of two crossings within such a short distance of 
each other, even though the second crossing could be provided at 
a low cost. 

The railway company will provide the land required for the 
re-location of the east and west highway, and all expenses in- 
cident to the construction of the same. For the reasons stated, 
the plan proposed by the railway company will be adopted. 

Now, THBaiEFORE, IT IS ORDERED, (1) That the portion of the. 
highway colored in green upon the map attached to the petition 
herein be closed by the petitioner ; 

(2) That a new highway be constructed by the petitioner on 
the line and according to the dimensions indicated upon said 
map, and colored yellow. 

Six months is deemed a sufficient time within which to comply 
with this order. 



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432 tlAlL.ltOAl> COMMISSION OP WISCONSIN. 



FREDERICK L. GROSS et al. 

vs. 
WISCONSIN TELEPHONE COMPANY et al. 



Submitted Nov. 25, 1910. Decided Feb, 21, 1911, 



The same petition and answer are filed in this case as were filed in 
National Travelers* Asa'n. v. Wis. Tel. Co. et al 5 W. R. C. R. 
678, which case was dismissed for lack of jurisdiction. The 
records of the former case were filed in evidence herein by 
agreement of the parties. 

Held: That the terms of the contracts between the Wisconsin Telephone 
Company and the co-respondent notel proprietors are discrim- 
inatory and in conflict with the legally published schedules; 
that said telephone company shall discontinue rendering serv- 
ice under all such contracts made subsequent to April 1, 
1907, until arrangements have been made whereby charges for 
service at stations in guest rooms of such hotels shall be no 
greater than those effective at other public stations. 

The allegations of the petition herein are identical with those 
set forth in that of a former case, National Trm/elers^ Associch 
tion vs. Wisconsin Telephone Company et a/. 5. W. R. C. R. 
678. Because of the inability of the petitioner in the case cited 
to invoke the jurisdiction of the Commission, the petition was 
dismissed and thereupon the present proceeding was instituted 
by twenty-five members of such association. The answer of the 
respondent telephone company is also identical with that filed in 
the former case. 

The matter came on for hearing on Nov. 25, 1910, in 
the city of Milwaukee. The petitioners were represented by 
Frederick L. Gross, and the respondents by Miller, Mack & 
Fairchild. 

By agreement of the parties, the record in the former case 
mentioned was introduced in evidence and some further testi- 
mony offered, which is of no consequence in determining the 
matters at* issue. The view taken by the Commission upon the 
former hearing of the contracts between the Wisconsin Tele- 
phone Company and the respondent hotel proprietors has not 



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G&OSS BT. Ah. V. WIS. TBL. 00. ET. AL. 433 

been changed by anything produced upon the hearing in the in- 
stant case. That the terms of the contracts are in conflict with 
the legally published schedules of the company and discrimina- 
tory, must be conceded. 

No attempt has been made to explain this violation of the 
statute. Under the circumstances, the duty of the telephone 
company is clear. It should discontinue rendering service under 
all such contracts which were made subsequent to April 1, 1907, 
and refuse to render any service to hotels of the character in- 
volved in this proceeding until an arrangement has been made 
whereby the public shall not be compelled to pay more at stations 
in the hotel rooms than the regular rates established by the com- 
pany at any of its public pay stations within the city of Mil- 
waukee. 

Now, TiiEREFORK, IT IS Ordebbid, That the Wisconsin Tele- 
phone Company discontinuie the connection of its telephone sys- 
tem with the private systems of its co-respondents unless arrange- 
ments are made whereby the charges for services at stations lo- 
cated in the rooms of the hotels leased, owned, or managed by 
' its co-respondents shall be no greater than those effective at 
its other public pay stations. This order shall not apply to the 
service rendered by the telephone company under any contract 
made prior to April 1, 1907. 

Sixty days is deemed reasonable time within wliich the re- 
spondent telephone company shall comply with this order. 
28--R. D. 



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434 RAILROAD COMMISSION OP WISCONSIN. 



WHEELER-TIMLIN LUMBER COMPANY 

vs. 
CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY. 



Decided Feb, 23, 1911. 



Petition alleging overcharge on a shipment of lumber from Wausau, 
Wis., to Horicon, Wis. The shipment had first b^en weighed 
at the shipping point, and when later checkweighed at New 
Lisbon, the scale showed a greater weight; the charges were 
based upon the New Lisbon weight. 

Held: That charges must be based upon actual weight, and if an error 
in weighing occurs, it must be corrected and charges adjusted 
accordingly; that in the instant case the true weight was that 
ascertained by the checkweighing at New Lisbon. Petition 
dismissed. 

The petitioner in the above entitled action is a corporation 
engaged in the wholesale lumber business. It alleges that on 
Aug. 24, 1910, it shipped from Wausau, Wis., a car of lumber 
consigned to the Van Brunt ^Manufacturing Co. at Hbricon, 
Wis. ; that said car was weighed at Wausau, Wis., by a sworn 
weighmaster, who stated that the scales were in perfect condi- 
tion, car properly spotted, unattached at both ends, and standing 
still, and that the car weighed 74,000 lbs. 

The petitioner contends that if the Wausau scales were in the 
condition stated and the car properly spotted and properly 
handled at New Lisbon, there could not have been a difference 
of 1,600 lbs. in weight between the Wausau scales and the New 
Lisbon scales. It also contends that it should be allowed refund 
on the basis of the Wausau scales. 

The respondent, the Chicago, Milwaukee & St. Paul Railway 
Company, answering the petition, admits all the formal alle- 
gations tliereof, but denies that the petitioner was overcharged 
on this shipment, claiming that the proper weight to have been 
applied was the New Lisbon check weight. Further answering 
the petition, it alleges that the shipment set forth in the petition 
was weighed at Wausau, Wis., and checkweighed at New Lis- 
bon, and that the New Lisbon weight was verified and applied 



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WHEELER-TIMLIN LBR. CO. V, C. M. & ST. P. B. CO. 435 

on the shipment. Wherefore, the respondent prays that the 
petition be dismissed. 

The claim was submitted upon the papers, pleadings, docu- 
ments and correspondence on file. 

The investigation discloses that the car in question was 
weighed on the respondent's scales at Wausau, and when the 
same reached New Lisbon it was again weighed and check- 
weighed. It was discovered that a difference of 1,600 lbs. ex- 
isted between the weight as noted on the waybill and •the actual 
weight as determined at New Lisbon. Petitioner seeks to hold 
respondent to the weight as reported by the weighmaster at Wau- 
sau. Errors of the character of the one here in controversy oc- 
casionally occur, and at times may result in loss to the shipper, 
particularly if sale of commodities is based upon track scale 
weight at point of shipment. Nevertheless, the law does not 
permit charges to be based upon anything but actual weights, 
and if an error in weighing occurs it must be corrected and 
charges adjusted accordingly. Any other policy would mani- 
festly afford an opportunity for the indulgence of practices sub- 
versive of the principle purpose of the statute which prohibits 
unjust discrimination. As was said in Merrill Woodenware 
Co, V, C. M, & SL P. R, Co, 3 W. R. C. R. 54, 56: 

"Errors in billing, or erroneous quotations of rates by agents 
of railway companies, do not relieve the shipper of the obliga- 
tion of paying the lawful rates prescribed in the published tar- 
iffs, nor are the railway companies for any such reasons per- 
mitted to exact less than such rates. The purposes of the law 
have been so clearly stated and discussed in the authorities, that 
a reference to several cases will suffice. A. /. Poor Grain Co, v. 
C. S. & Q. R. Co. 12 L C. R. 418 ; Texas & P. R. Co, v, Mugg, 
202 U. S. 242; Gulf C. & Santa Fe R, Co. v. Hefley, 158 U. S. 
98; Church v. Minneapolis & St. L. R.'Co. 14 S. Dak. 443; 85 
N. W. 1001 ; Saruannah F. & W. R. Co. v. Bundick, 94 Ga. 775; 
21 S. E. 995 ; Missouri K. & T. R. Co. v. Bozvles, 1 Ind. Ter. 
250; 40 S. W. 899." 

It is apparent that the error of which complaint is made 
was made at the scales at Wausau and, when the same was dis- 
covered at New Lisbon, the car was weighed a second time for 
the sake of certainty as to the true weight 

For the reasons stated the claim must be dismissed. 

Now, Therefore, it is Ordered, That the petition herein be 
and the same is hereby dismissed. 



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436 RAILROAD COMMISSION OB^ WISCONSIN. 



WISCONSIN PULpP and PAPER MANUFACTURERS 
V8. 

CHICAGO AND NORTH WESTERN RAILWAY COMPANY, 
CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY, 
GREEN BAY AND WESTERN RAILROAD COMPANY, 
WISCONSIN CENTRAL RAILWAY COMPANY. 



Decided Fe}>. 24, JUU. 



Petition alleging excessive, unjust and unreasonable rates for the 
transportation of coal from the Lake Michigan ports in Wis- 
consin to various points in the f\>x River Valley and the 
Wisconsin River Valley districts. The rates at present In 
effect are uniform to the different points in each of the above 
named districts, regardless of the distance of such receiving 
points from the respective shipping points. The petitioners 
contend that if the railways wish to continue group rates, 
made to apply from all lake ports equally, they should be 
based upon the shortest haul instead of on the longest, os it 
is alleged is now the case; or, if the railways prefer, that the 
rates from the different lake ports should be based upon the 
average distance from each port into the two manufacturing 
groups involved, without any attempt to put the ports on an 
equal footing. 

Many comparisons were made between the rates complained of and the 
rates in neighboring states where similar conditions prevail, 
and also with the rates in the paper mill districts in the New 
England states. Some evidence was also introduced relative 
to the cost to the carrier of the services involved. 

Held: That carriers are ordinarily entitled to rates that will yield 
sufficient revenue to cover operating expenses, including a 
reasonable amount for interest and profit; that no rates should 
be so low that they do not cover their fair share of operating 
expenses, including something in the way of net earnings; 
that the earnings per unit of profit should be lower for low 
grade than for high grade articles; that the relation which the 
rates on the various classes of freight ought to bear to each 
other, largely depends upon such factors as the value of the 
articles, their bulk in proportion to their weight, the risk in- 
volved, the magnitude and regularity of the traffic, etc.; that 
in the instant case tho present grouping should bo preserved, 
and that the rate on coal from the lake ports to the two mill 
groups should be based upon the average distance fr^om these 
ports to some point in the center of each of these mill groups ; 
that under the facts disclosed herein, no deduction in the rate 
to the Wisconsin river mills can be made at this time; that the 
rate to the Pox river mills should be reduced from 75 cts. to 65 
cts. per ton. It is so ordered. 



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WIS. PULP <fc PAPER MPRS. V. C. & N. W. R. CO. ET AL. 437 

The petitioners are a group of over thirty manufacturers of 
wood pulp, sulphite, and paper, organized into a voluntary asso- 
ciation, with factories located principally in what are known as 
the Fox River Valley and Wisconsin River Valley districts in 
th€ state of Wisconsin. They complain that the rates charged by 
the respondent railway companies for the transportation of coal 
from Green Bay, Manitowoc, and other Lake Michigan ports in 
Wisconsin, to the places wh^re the petitioners' manufacturing 
plants are located, are excessive, unjust, and unreasonable. 
Wherefore, " petitioners pray for an order requiring the said 
respondent companies to desist from such charges, and for such 
other relief as the Commission may deem necessary and just in 
the premises. 

Separate answers were filed by the respondents, the Chicago 
& North Western Railway Company and the Wisconsin Central 
Railway Company, each denying that the rates complained of 
are excessive, unjust and unreasonable, and praying that the pe- 
tition be dismissed. 

Hearings were held in the matter Oct. 14, Oct. 26, and Oct. 
27, 1908, and the matter was orally argued Jan. 12, 1909. Felix 
Streyckmans appeared for the petitioners; 5*. A, Lynde for the 
Chicago & North Western Railway Company; William Ellis 
for the Chicago, Milwaukee & St. Paul Railway Company; 
/. A. Jordan for the Green Bay & Western Railroad Company ; 
and Thovias H. Gill for the* Wisconsin Central RailAvay Com- 
pany. In addition to the oral arguments, briefs were submitted 
by counsel for the petitioners and by counsel for the Wisconsin 
Central Railway Company. 

The evidence introduced' upon the hearings related, generally 
speaking, to four principal subjects, viz. : the present rates, and 
the conditions under which they apply to petitioners' mills; the 
theory upon which the rates complained of are made; statistics 
of costs and earnings which have a bearing upon the reasonable- 
ness of rates ; and rates on the same commodity in other locali- 
ties, introduced for comparative purposes. 

The rates on soft coal at present in effect, and complained of 
by the petitioners, extend from Milwaukee, Sheboygan, Manito- 
woc and Green Bay, the four principal coal receiving ports in 
Wisconsin on Ljike Michigan, to a large number of Wi-^^consin 



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438 



RAII^OAD COMMISSION OP WISCONSIN. 



points, including Appleton, Neenah, Kaukauna and Green Bay, 
in the so-called Fox River Valley district, and Grand Rapids, 
Nekoosa and Merrill in the so-called Wisconsin River Valley 
district. The uniform rate from the four lake ports, regardless 
of distance, to the Fox River Valley points, is 75 cts. per ton, 
and the rate from the same ports to the Wisconsin River Valley 
points is $1 per ton. The following table shows the variations 
in distance covered by the two rates named' on the four re- 
spondent railways: 







Distances (miles). 




Road. 


From 
Milwaukee 

27 to 129 
(»l to 112 
32 to 130 

105 to a04 

74 to aw 

117 to 278 


From 
Manitowoc? 


From 
(ireen Bay, 

. .. . . 

12 to 102 
17 to llii 


From 
Sheboyiran 


75 cent rate. 
('. & N. W 


ST. to lOT. 


20 to 80 


C. M. & St. P 




NV.C 


2:1 to 108 
4l> to 175 




$1.00 rate. 
C.& N. W 


37 to 171 
275 to 357* 


74 to 180 


CM. &St. P 




W.C 


(16 to 226 




O. B. & W 


24 to 110 











*Cora]»etltive with distance of 00 to I75ninest0!>iune noints via (t. B. & W. K. U. 

Of the above distances, the shortest distance to any of the 
petitioners' mills covered by the 75 ct. rate is 22 miles, from 
Green Bay to Kaukauna. The traffic manager of the petitioners 
claimed that the rate of 75 cts. to the Fox River valley was 
based on the distance from Milwaukee, which is the port far- 
thest from the points of destination, and was made to apply to 
the shorter distances as a group rate ; that the same principle 
was followed in the case of the $1 rate to the Wisconsin valley ; 
and that the establishing of the same rate from all the ports to 
the manufacturing districts had the effect of stifling competition 
among the railroads and throwing it upon the coal dealers. 

These statements were challenged by a witness for the Chi- 
cago & North Western Railway Company, who testified that the 
rates were based, not on the long distance, but on the average 
distance from the lake ports into the manufacturing districts; 
that the effect is not to stifle compction between the railroads, 
but to make them compete on an equal basis, as is the ca.se 
wherever several railroads reach common points ; tliat in tlie Fox 



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WIS. PULP & PAPER MPRS. V, C. & N. W. R. CO. ET AL. 439 

River valley, extending from Green Bay to Fond du Lac, there 
is a community of interest among the manufacturers which re- 
(juires the grouping of the whole valley in the making of rates; 
and that the present rates, which have been in effect since 1904, 
are a considerable reduction below those formerly in effect, and 
are lower tliian the rates which were in effect in Illinois prior to 
the cutting of rates there by competing lines. 

On the part of the Chicago, Milwaukee & St. Paul Railway 
Company, it was admitted that the 75 ct. rate for 17 miles, the 
shortest haul included in that rate on its line, was high, but 
it was claimed that on the general average of the entire group 
to which the 75 ct. rate applied, that rate was reasonable. More- 
over, the fact of an empty back haul was brought out as an ele- 
ment of extra expense in making the short distance shipments 
from Green Bay, not present in the case of shipments from Mil- 
waukee; for in the latter case, the general trend of traffic being 
southward, the cars can be sent back loaded. Another element 
of expense, according to the testimony for the Chicago, Mil- 
waukee & St. Paul Railway Company, was the shipment of emp- 
ties from Milwaukee to Green Bay to receive the coal from the 
docks there, which shipment, it was testified, was necessary sixty 
per cent of the time. The same witness also brought out the fact 
that since the docks at Green Bay are all on other railroad lines, 
the Chicago, Milwaukee & St. Paul Railway Company must 
absorb a $2 switching charge there, and often a like charge at 
destination, and that with an average revenue of only $15 per 
20-ton car, such a $4 expense greatly reduced the revenue of the 
road. 

Some mention was made of a l)oat rate of 50 cts., in effect 
from Green Bay to Appleton, on coal, but the testimony shows 
that there is very little movement on that rate, owing to the lack 
of dockage and storage facilities on the part of the petitioners, 
and the resulting extra expense of handling water shipments. 

As to the conditions under which the present rates apply to 
the petitioners' mills, the respondent railway companies claimed 
that a large element of cost to them, tending to make the present 
rates reasonable, was due to the fact that petitioners' mills 
had not the facilities for storing coal, and found it necessary 
to receive regular shipments, in many cases daily. The move- 
ment was described as "persistently urgent," requiring in most 
pases tifne freight service, and, at times, special trains. The lack 



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440 RAILROAD COMMISSION OP WISCONSIN. 

of Storage facilities, it was said, was due to the fact that the 
receiving tracks at several of the mills are built on trestles over 
the water, and, therefore, even if the mills should" go to the great 
expense of providing storage space somewhere else, a re-han- 
dling would be necessary. According to a witness for the Wis- 
consin Central Railway Company, the practice of the mills is to 
order their coal in the afternoon by telephone, and have it 
shipped' out the next morning, not on **drag" trains, as is usually 
true of coal shipments, but on mixed trains, with what amounts 
to merchandise service. As an illustration of the importance of 
quick service in the Wisconsin valley, the witness testified that 
the Wisconsin Central Railway Company lost a great deal of bus- 
iness by reason of the fact that, although it made the same rate 
as the other roads, it had a longer route. The petitioners, on 
the other hand, claimed that the rapidity and regularity of this 
movement w^as an advantage to the railroad company, in enabling 
it to have its cars unloaded promptly and' to anticipate the move- 
ment accurately. 

The respondents claimed that the petitioners had another spe- 
cial advantage under the present system of rates, in the choice 
of ports from which to draw their coal supply. The testimony 
shows that by far the largest part of the coal used by the pe- 
titioners is obtained from Milwaukee, the reason being, as given 
by a witness for the respondents, the better harbor, better labor 
conditions, and longer establishment of Milwaukee as a port. 
It was also shown by the testimony of a Milwaukee coal dealer 
and of railroad officials that the fixing of a diflferent rate from 
Milwaukee than from the other lake ports would make it im- 
possible for Milwaukee to participate in the business. The re- 
spondents claimed, therefore, that any system of rates which 
which would shut off Milwaukee as a point of origin for the 
petitioners, would greatly embarrass them in obtaining the sup- 
ply of coal which they needed. 

It was also pointed out that any reduction of rates which dis- 
turbed the equality of Milwaukee as a point of origui with the 
other ports, would tend to give the coal dealers at the other ports a 
monopoly, and the benefit of the reduction would go to them. 

The respondents also introduced testimony to the eflFect that 
the shipments of coal into the territory herein involved through 
the lake ports are interstate shipments, made from Ohio and 
Virginia coal producing points, and billed through to final desti- 



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\7iS. PUiiP & PAPtR iiPRS. V. C. A N. W. ft. CO. fiT AL. 441 

nation on a rate made up of the sum of the rate to the Lake 
Michigan ports, and the rate from the ports to the mills. It 
was shown that the rate from the ports to the mills is filed 
with the interstate commerce commission, and a reduction of that 
rate would reduce the interstate rate, of which it is a compo- 
nent part. The traffic manager of the petitioners testified, how- 
ever, that very little coal used by the petitioners is bought di- 
rectly at the mines and shipped through to them, but that most of 
it is bought at the Wisconsin ports and shipped to them as an 
intrastate shipment. 

The petitioners introduced some testimony as to conditions in 
the paper industry, as an element affecting the reasonableness 
of the rates. It showed that the Wisconsin paper mills find their 
greatest competition in the eastern states; that the business is 
conducted on a narrow margin, the profit on print paper, with- 
out any allowance for interest or depreciation on the investment, 
being only $1.10 per ton, worth $45 tb $50; that the increased 
price charged for paper since 1902 has been offset by an increase 
of 36 per cent in the cost of materials, especially wood, and 
labor ; and that a 25 ct. reduction in the cost of coal at the mill 
would mean a corresponding reduction per ton in the cost of 
paper, as the shipments in of coal about equal in tonnage the 
shipments out of paper. The rate on paper out, from the mills 
in both the Fox River Valley and the Wisconsin River Valley 
districts was shown to be a group rate of 7^ cts. per cwt. to 
Milwaukee and Milwaukee rate points, and 10 cts. per cwt. to 
Chicago and Chicago rate points. 

The contention of the petitioners, as stated by their traffic man- 
ager, is that there should be a reduction of the rate from the 
lake ports to the Fox River valley from 75 cts. to 50 cts., and to 
the Wisconsin valley from $1 to 75 cts. The petitioners do not 
object to the group system of rates, but desire a general lowering 
of the group rate. It is their claim that if the railways wish to 
have a group rate, and to make it apply from all the lake ports 
equally, it should be based on the distance from the nearer ports 
and then applied to the longer haul from Milwaukee, instead ol 
being based on the long haul, as the petitioners claim to be the 
case at present. Or, if the railways do not see fit to follow this 
suggestion, the petitioners desire that the rates from each port 
into the two manufacturing groups involved herein, be based 



Digitized by VjOOQIC 



442 KAlLftOAD COMMISSION OF WISCONSIN. 

on the average distance from that port, without any attempt to 
put the ports on an equal footing. 

As to the theory upon which the present rates are made, the 
witnesses for the respondent companies testifi^ that the Fox 
Kiver valley, extending from Green Bay to Fond du Lac, was 
made to constitute a group; that in order to put the severed 
gateways on an equal tooting, the rate was made the same from 
several points of origin into this group ; that although the rates 
to points on either nm of the group might be too high or too 
low, judged absolutely, the theory of the group rate requires the 
average distance into the group to be the basis of the rate; that 
to make the element of distance enter into the rate would de- 
stroy the group theory, and a distance rate would be necessary 
throughout; and that the group rate fosters industrial develop- 
ment, by permitting industries to compete on an equal rate basis, 
although one of them may be farther from a given market than 
another. Moreover, counsel for the respondent Chicago, Mil- 
waukee & St. Paul Railway Company insists, on the oral argu- 
ment, that the real movement is from Virginia and Ohio to the 
petitioners' mills, and not from the lake ports. That being true, 
It makes no difference to the petitioners, he says, whether the 
part of the haul in Wisconsin is a little longer and that outside 
of Wisconsin a little shorter, or vice versa; in so long a haul 
from mine to mill, differences in distance within Wisconsin are 
too small to be taken into account. He points also to the fact 
that an enormous amount of money has been invested in dock- 
ing facilities at Milwaukee, that about 5,000,000 tons of coal are 
handled at that port annually, and that any change of rates tak- 
ing from Milwaukee the benefit of the group system, would im- 
pair greatly the investment at that port and congest the coal 
business at the other ports. 

The petitioners claim, on the other hand, that the present rates 
are not, properly speaking, group rates at all, because the rate 
from one point (Green Bay) within the group itself, to other 
points in the group, is the same as the rate from an outside 
point (Milwaukee) into the group; that where a group consists 
of a number of points of destination, the group theory requires 
that the points of origin be outside of the group and at some 
distance from it, whereas in the present instance only one of the 
four points of origin is really outside of the Fox River Valley 
group ; and that this arrangement takes away from the mills 



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wis. PXJLP k PAi>EB MFB8. 1>. G. A N. W. &. CO. IBT AL. 443 

nearest to Green Bay and Manitowoc the advantage of their 
proximity to these ports. Counsel for petitioners, in his brief, 
Hkens thfe principle of the system in yse at present to that of a 
supposed system which would make St. Paul and Minneapolis a 
group from Chicago, and would charge the same rate within 
the group, from St. Paul to Minneapolis, as from Chicago into 
the group. The petitioners contend that the advantage claimed 
by the railway companies, of giving the petitioners a choice of 
ports, is no advantage at all when the nearer ports are given a 
rate based on the distance from the farther ports. 

On the subject of costs and earnings, the respondent Chicago 
& North Western Railway Company introduced a statement 
showing the average earnings from the four ports to the Fox 
River valley to be 1.2 cts. per ton per mile, and to the Wiscon- 
sin River valley 0.67 cts. per ton per mile. 

The representative of the Wisconsin Central Railway Com- 
pany testified that the average earnings of his road on coal from 
Milwaukee and Manitowoc to the petitioners' mills, in both the 
Fox River and Wisconsin River valleys, were 5.93 mills per ton 
per mile; that the average cost of such traffic was 4.12 mills, 
leaving a profit of 1.81 mills per ton per mile. A rate reduction 
of one-third to the Fox River district and one-fourth to the Wis- 
consin River district, as requested by the petitioners, would, he 
testified, reduce the earnings on the Fox River valley traffic 1.97 
mills per ton per mile, and leave a deficit of 0.16 mills per ton 
per mile, and on the Wisconsin valley traffic the reduction would 
leave a profit of 0.33 mills per ton per mile, which would not 
be sufficient to keep the rate from being confiscatory. The pe- 
titioners attacked the earnings figure of 5.93 mills per ton per 
mile as grossly incorrect. On cross-examination of the witness 
for the Wisconsin Central Railway Company, they showed' that 
in the case of the Fox River valley the mills at Neenah and 
Menasha, a distance of 43 miles from Manitowoc and 97 miles 
from Malwaukee, are the only mills in the Fox River valley on 
the line of the Wisconsin Central Railway, and that therefore the 
earnings on coal to those mills from Manitowoc and Milwaukee 
would average over 1 ct. per ton per mile ; while from Manito- 
woc alone, a distance of 43 miles, the earnings on traffic to the 
Fox River valley would be nearly 2 cts. per ton per mile. 

The respondents, in their testimony and arguments regarding 
costs and earnings, made reference to the case of Elhertson v. 

Digitized by VjOOQIC 



444 RAILROAD COMMISSION OF wiSGOKStN. 

C. St, P. M, & O. R. Co. 2 W. R. C. R. 593, 602, where, in 
fixing the rate on coal from Superior to northwestern Wiscon- 
sin points, the Commission mentions the expenses of trans- 
porting 25-ton cars of coal as being about 25 cts. per ton termi- 
nal expenses, and 5 mills per ton per mile haulage cost; also to 
the case of Noble et al. z/. C. SU P. M. & O. R. Co. 1 W. R- 
C. R. 767, 775, where, for about the same haul, the terminal ex- 
pense in the case of 30-ton cars was fixed at about 18 cts. per 
ton, and the haulage expense at 5 mills per ton per mile. It 
was testified that the 5.93 mills earnings per ton per mile, as 
given for the Wisconsin Central Railway Company, did not in- 
clude any terminal charge. The cost of the coal traffic to peti- 
tioners' mills was stated to be higher than the average of all 
the rest of the traffic on the Wisconsin Central Railway, on ac- 
count of the special service rendered to the petitioners. 

The general contention of the petitioners, on the subject of 
earnings, was that coal is a profitable commodity for the rail- 
roads, and that coal-carrying roads have higher profits in gen- 
eral than other roads. The respondent claimed, however, that 
the high earnings of such roads were due to a profitable traffic 
in lumber and other high class commodities, and not to the trans- 
portation of coal. 

On the subject of rate comparisons, a great deal of the testi- 
mony offered related' to the rates on soft coal from the Illinois 
mines to Illinois points. The petitioners introduced in evidence 
tariffs and compilations showing such rates in force on the Chi- 
cago & North Western, the Chicago, Milwaukee & St. Paul, and 
the Illinois Central lines. The rates on the two roads first 
named appear to be made on the group basis, while those on the 
Illinois Central Railroad are apparently fixed for each manufac- 
turing point according to the dictates of competition and other 
local conditions at that point. 

From the compilations submitted in relation to the group rates 
on the Chicago, Milwaukee & St. Paul and the Chicago & North 
Western lines, the following table has been made, showing the 
distances over which various rates apply on the said' lines in 
Illinois : 



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WIS. PULP & PAPER MFBS. V. C. & N. W. R. CO. ET AL. 445 



From 


TO 

North and east to Chictufo. 


Distance, 
miles 


Rate 
in cts. 


Chicago Jc North 
Wentem HaUway, 

SprlniT Valley 


17 to 109 

17 to 102 

417 to 56 
-65 to 78 
/84 to 120 

J22to 43 
(46 to 101 

\22 to 58 

] 70 
|78 to 88 

r22 to 38 

s? 

67 

174 to 110 


50 




North and West to Sterllnif 


50 


.. .. 


North to Freeport 


50 
55 


ChicaQo, Milwaukee A 
$t. Paul Railway. 

SeatonvUle 


North aud east to EWin 


60 
50 




North to Beloit, Wis 


56 

55 
60 




North to Freeport 


73 

55 
65 






70 
75 



The above table shows a rate of 50 cts. for distances run- 
ning as high as 109 miles on the Chicago & North Western line, 
and of 55 cts. for distances up to 101 miles on the Chicago, Mil- 
waukee & St. Paul line, into manufacturing districts which pe- 
titioners claim to be comparable to 'those involved in this case. 
These rates the petitioners compare with the 75 ct. .rate from the 
lake ports into the Fox Riv^r valley for about the same maxi- 
mum distance, and the $1 rate into the Wisconsin River valley 
for a distance, in some instances, of 100 miles and less, under 
the Wisconsin group system. 

The Illinois Central rates, introduced by the petitioners, are, 
as stated, not arranged on a group basis, but vary with every 
station. They are not uniform for like distances into the same or 
different manufacturing centers; each manufacturing point, ap- 
parently, is given a rate according to the peculiar conditions ob« 
taining locally, and the rates to adjacent points for some distance 
on either side are scaled up to it and down from it. The follow- 
ing table shows rates on soft coal on the Illinois Central line 
from five mining districts into ten manufacturing points in 
Illinois ; 



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446 



RAILROAD COMMISSION OP WISCONSIN. 



HUhoIh Crntral lioad. 



To 



From 



Du uoln . La Salle I Mt. Olive 



Mile 



Chicaeo 287 

Kankakee 231 

Champaign 159 

East St. Louis 71 

Decatur 128 

Bloominffton 172 

Peoria , 203* 

Dixon 275* 

Freeport 311 

Rockford 339 



Rate Miles Rate Miles 



«0.90 

.89 

.82 

.45 

.70 

.90 

.75 

1.09 

1.10 

1.10 



155 ,10.60 



09 



.59 



124 I .95 

TM 1.13 

104 ! .91 

«0 .80 

149 1.00 

43 .59 

79 . .60 

107 i .(» 



245 
189 
139 
48 
99 
121 
132 
224 
260 
288 



Rate 



10.75 
.74 
.75 

.5.0 
.74 
.55 
.99 
1.00 
1.00 



Plnckney- 
viUe 



-0pauldln«r 



Mll«s 



297 
241 
169 
61 
138 
182 
215 
285 
321 
349 



Rate Miles 


Rate 


K).90 


184 


10.75 


.89 


128 


.7S 


.87 


78 


.70 


.42 


109 


.91 


.83 , 


38 


.49 


1.00 . 


60 


.70 


.85 


71 


.45 


1.14 


ItfS 


.94 


1.14 


199 


.95 


1.14 

1 


227 


.$6 



The petitioners point out that the above rates, voluntarily fixed 
by the Illinois Central Railroad, are in almost every case lower 
than the maximum distance tariff scale prescribed by the Illinois 
railroad and warehouse commission, the average reduction from 
that scale being about 20 per cent. They claim that the manufac- 
turing points in which the above rates are made are subject to 
substantially the same general conditions as those in the Fox 
River and Wisconsin River valleys. The traffic manager of 
the petitioner testified, as to the Illinois Central tariff, that he 
originally compiled the tariff while an officer of the Illinois Cen- 
tral Railroad; that it was established as a re-Issue of distance 
and special commodity tariffs previously in effect to Illinois man- 
ufacturing towns, and had for its object the regular grading to 
intermediate points of the rates that had previously been applied 
only to manufacturing centers ; and that the rates named in the 
tariff were made with the idea of giving to the road sufficient 
remuneration on what it considered a very valuable traffic. 

The respondent railway companies, in cross-examining the 
petitioners' traffic manager with regard to the Illinois Central 
tariff, attacked a number of the rates as inconsistent. The wit- 
ness explained the rates attacked, in one case on the ground of 
being a "paper rate," applied from a point from which there was 
no actual movement, and, therefore, fixed with less care than 
rates for actual movements; in other cases on the ground of 
difference in commercial conditions, as, for example, differences 
in cost of mining as between various districts, and differences 
in the quality of coal, limiting it to particular markets ; and in 



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WIS. PULP A PAPER MPBS. V. C. & N. W. R. CO. KT AL. 447 

Still other cases on the ground of competition between railroads, 
resulting in the application of the rate fixed by the road having 
the shortest haul. Even where there was no direct competition 
between the railroads between particular points, the witness 
testified that in the fixing of the rates regard was paid to the 
rates from nearby coal mining districts to the same markets, 
there being a fixed diflferential among the five principal coal 
mining districts of Illinois in the nates to Chicago. The general 
principle upon which the Illinois Central rates were made was 
stated to be the fixing of a certain rate to a given manufacturing 
point, and the regular grading of that rate for stations in the 
vicinity of that point; which method- was contrasted with that 
used in Wisconsin, where the same rate is applied to the manu- 
facturing points and to the territory surrounding them. The 
• contention of the petitioners was that the movement of coal in 
Ilfinois from mines to manufacturing points was substantially 
similar to the movement in Wisconsin from lake ports to the Fox 
River and Wisconsin River valleys, and that the Illinois Central 
rates were therefore comparable with those in effect in Wiscon- 
sin. The respondent comf>anies, however, brought out the fact 
that the movement of coal into Chicago on the Illinois Central is 
largely a trainload movement, and thus, as the respondents 
claimed, not comparable with the carload movement to the Wis- 
consin points; also that the coal traffic amounts to 35 per cent 
of the entire traffic of the Illinois Central Railroad, whereas that 
of the Chicago & North Western Railway equals only 11.6 per 
cent of Its entire traffic. 

Testimony was offered by the respondents in regard to the 
Illinois coal rates, to the effect that at one time every road fixed 
its rates from the Illinois mines on a dis-tance basis, without re- 
^rd to groups or relation of rates : that to remedy this condi- 
tion the railroads left the fixing of d'ifferential rates on a distance 
basis to an arbitrator; that the resulting scale, known as the 
"Faithorn arbitration/' named the differentials to be applied from 
particular mines, and that as new mines were opened up, the 
Illinois Central Railroad took advantage of the other roads, and 
claimed that the arbitration did not extend to the new mines: 
that in ordter to compete with the lower rates thus established 
by the Illinois Central Railroad, the other roads of the state 
were forced to abandon the distance rate basis; and that the 
rates in effect before this latter change took place were higher 



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448 



RAILEOAD COMMISSION OP WISCONSIN. 



than the present Wisconsin rates. An official of the Chicago & 
North Western Railway testified that the movement from the 
mines to junction points on his line, and thence in some cases 
to large distributing points, was entirely a trainload movement. 
On the part of the Chicago, Milwaukee & St. Paul Railway Com- 
pany it was testified that the rates mentioned' by the petitioners 
as being in effect on that line in Illinois wefe mainly "paper 
rates," applying to points where there was no movement, and 
that the only rates contained in the petitioners' statement which 
represented actual movement were the rates of 60 cts. for 70 
miles to Rockford, and 75 cts. for 88 and 110 miles to Beloit 
and Freeport, respectively. 

The general contention of the respondent companies in re- 
gard to the Illinois rates was that they were fixed- by competi- 
tive forces outside of the respondents' control, were, as one 
of the witnesses put it, in many cases absurd and unfair, and 
were not to be treated! as an indication of what would be reason- 
able for Wisconsin. 

In addition to the Illinois rates, the petitioners introduced for 
comparative purposes tariffs and compilations showing group 
rates on soft coal covering considerable territory in Wisconsin 
and neighboring states. The rates so introduced, together with 
the distance covered by each, are given below : 



Bead 


From 


Direction 


Distance 


55 cent rate, 
C.&N.W 


Menomloee. Mich 

Escsnaba. Mich 

Gladstone. Mich 

Menominee, Mich 

Green Bar, Wis 

Menominee. Mich 

Escanaba, Mich 

Gladstone, Mich 

Manistique, Mich 

Manitowoc 


North 


4 to 71 


C.&N. W 


North and West . . 


3 to 89 


Soo 


West 


8to 32 


65 cent rate. 
C. & N. W 


North 

North to Michigan points. 
North 


73 to 89 


75 cent rate. 
C.&N. W 


5 to 121 


C &N. W 


98 to 109 


C &N.W.. 


North 


80 to 91 


Soo 


East 


44 to 152 


Soo 


East 


55 to 108 


90 cent r<Ue. 
w.c 


West to St. Paul & Mpls. . 

West to St. Paul., Mpls. & 
intermediate points. 

South to Chicago, thence 

west to Pulton, 111 

Iowa points 


314 to'330 


Soo 


Gladstone. Mich 

Manitowoc. Wis 

Green Bay 




One dollar rate. 
C.& N. W 


44 to 363 


aM. & 8t.P 


85 to 283 
2a0to341 









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WIS. PULP A PAPER MPRS. V. C. A N. W. R. CO. ET AL. 449 

In addition to the group rates shown a'bove, compilations 
were submitted by the petitioners, showing a rate of 50 cts. in 
Indiana on the Indianapolis Southern Railroad to three manu- 
facturing points at distances ranging in the specific cases from 
42 to 111 miles; also joint rates in Indiana on the Chicago & 
Eastern Illinois and Rig Four lines, of 50 cts. for special points 
at distances of from 28 to 87 miles, 60 cts. for specific points at 
71 to 151 miles, andl 75 cts. for specific points at 103 to 169 
miles. A joint rate of 75 cts. was also s'hown between the 
Chicago & Eastern Illinois and the Toledo, St. Louis & Western 
lines, for specific distances ranging from 83 to 144 miles. The 
testimony of the respondents as to the Indiana rate was to the 
effect that the movement in Indiana, like that in Illinois, is 
largely a trainload movement from mine to manufacturing cen- 
ter, and the coal traffic constitutes 60 per cent of the entire 
traffic of the Chicago & Eastern Illinois Railroad. 

In attacking the rate comparisons given in the above table for 
northern Michigan points, the respondent Chicago & North 
Western Railway Company showed that such rates apply to a 
trainload movement from the docks to the iron mines, in ore 
cars which would otherwise run empty, so that the movement 
is a loaded movement both ways and the rate charged there- 
fore cannot be compared with that in the Wisconsin districts. 
The respondent also claimed that the addition of 25 ots. charged 
by the dock companies at the Michigan ports and not charged 
at the Wisconsin ports herein involved, would make the final 
cost to the shipper as great as it is under the Wisconsin rate 
for like distances. 

As a further indication of the injustice of the present Wis- 
consin rates, the petitioner introduced a compilation showing 
the Illinois, Missouri, Iowa, and Minnesota distance rates, as 
fixed by the railroad commissions of those states, and also the 
local distance tariflF rates of the Chicago & Eastern Illinois 
Railroad in Indiana. The compilation follows : 
2&— R. D. 



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450 



RAJLBOAD COMMISSION OP WISCONSIN. 



Distances not 
exceeding 


IllinolB 
commis- 
sion rates 


Missouri 
commis- 
sion rates 


Iowa commission 
rates 


Minnesota 
commis- 
sion rates 


C. & R. I. 


Lump and 
nut 


Pea and 
slack 


Indiana 
rates 


25 mtles 


.68 

.72 

.76 

.86 

.90 

.93 

.95 

1.00 

l.(& 

1.10 

1.17 

1.26 


10.50 

.60 

.60 

.70 

.70 

.85 

1.00 

1.10 

1.10 

1.26 

1.35 

1.50 

1.66 

1.85 


90.46 

.50 

.58 

.62 

.66 

.85 

1.00 

1.045 

1.075 

1.15 

1.225 

1.30 

1.40 

1.50 


10.37 
.40 
.46 
.49 
.52 
.64 
.74 
.785 
.815 
.89 
.965 
1.04 
1.14 
1.25 


.50 

.61 

.62 

.72 

.82 

.85 

.87 

.96 

1.05 

1.16 

1.34 

1.54 


10.30 


30 •• 


30 


40 " 


.4) 


45 *' 


.40 


50 " 


.40 


75 *• 


.50 


100 *' 


.60 


115 '• 


.75 


125 ** 


.75 


150 " 


.75 


175 *' 


.90 


200 " 


.90 


250 " 


1.10 


300 '* 


1.35 


r ^ mi^. 





The petitioners point out that the rates on the shorter hauls 
under the Wisconsin group system are higher than those for the 
same distance under -any of the distance tariffs cited, and that 
the rates actually established in Illinois are lower than those 
fixed by the Illinois distance tariflF. 

For further comparison with the Wisconsin rates, counsel for 
the petitioners refers in his brief to a table on page 34 of the 
Second Annual Report of the Railroad Commission of Indiana 
(1907), which shows local rates on soft coal in Indiana to 
specific points as follows: 50 ct. rate for distances ranging 
from 60 to 121 miles on five lines; 65 ct. rate for 128 miles, 
Monon route; 75 ct. rate for 207 miles, Monon route. Noth- 
ing was introduced to indicate the conditions, competitive and 
otherwise, under which these rates apply. 

On the part of the respondent Chicago & North Western Rail- 
way Company, statements were introduced showing rates on 
soft coal to paper mills in the New England states, competing 
with petitioners' mills, as compared with similar distances from 
the lake ports to the manufacturing points herein involved; and 
also interestate rates between the Pennsylvania mines and Mc- 
Connellsville, N. Y., as compared with interstate rates from 
the Spring Valley coal district in Illinois to the Wisconsin 
points involved in this proceeding. The comparisons submitted 
are as follows: 



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WIS. PULP A PAPER MFRS. V. C. A N. W. R. CO. BT AL. 



451 



Road 



From 



To 



Distance 
(miles) 



Rate 

(irro8s 
ton) 



Compared with C. & N, W. rate of 73 cts. net ton. 84 cts. irross ton 27 to 129 miles, 
Milwaukee to Fox R. valley : 



Grand Trunk 


Portland, Me 


Berlin, N. H 


98 


$1.00 


Ban^r & Aroostook 


Searsport, Me 


MlUInocket. Me 


105 


1.25 




North Maine Jet. Me. 


29 


.85 


it » t 


1 1 » t 


Boyd Lake, Me 


56 


.85 


* * ' * 


Banffor, Me 


Dover. Me 


78 
12 

82 


1 CO 


Maine Central 


Great Works. Me.... 
Madison. Me. 


50 






1.00 


N. y. N. H. & H.. .. 


New Haven, Conn. 


llolyoke, M ass 


72 


.00 


" , ... . 


' • ' * ' ' 


Northampton. Mass. 


77 


.90 




Providence, R. I.... 


Worcester, M ass 


44 


.85 



Compared with C. & N. W. rate of $1 net ton. tl.12 arross ton, 105 to 204 miles, Milwau- 
kee to Wisconsin valley: 



Bangor & Aroostook... 
Maine Central 



Bear8port,Me. 
Bangor, Me . . . 



Monticello. Me.. 
Lewlston, Me.... 



174 
133 



11.75 
1.30 



Compared with C. & N. W. rate of tl.40 net ton, tl.57 gross ton, 296 to 303 miles. Spring 
Valley, IlL . to Wisconsin valley, and $1.35 net ton, $1.51 gross ton, 229 to 265 miles. 
Spring Valley to Fox River valley : 



N. Y. 0. & H. R Pennsylvania Mines M'Connellsvllle,N.Y 



300 



$1.90 



On the part of the respondent Wisconsin Central Railway 
Company, additional rate comparisons were submitted in the 
form of oral testimony, covering rates in various states, apply- 
ing, in each case, to points having paper mills. The respondent 
claims especial weight for these statistics because of the fact 
that they apply to the same industry in which the petitioners 
are engaged ; and it cites the failure of the petitioners to intro- 
duce any comparisons of rates to paper mills as an indication 
that such comparisons would be unfavorable to the petitioners. 
The comparisons introduced are as follows: 



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452 



RAILROAD COMMISSION OF WISCONSIN. 



Tariff 



From 



To 



Distance 
(miles) 



Rate 



Compared with W. C. rate of 75 cts., 32 to 13G miles. Milwaukee to Fox River valley: 



Ohio Coal Traffic As- 
sociation. 



Northern Pacific. 
Great Northern . . 



Jackson, Ohio 

Plttsburarh Dist 

Duluth, Minn 

Duluth. Minn 



Dayton. Ohio 

Erie, Pa 

Cloquet. Minn 

Cloquet. Minn 

Grand Rapids, Minn. 



77 
ido 
28 
41 
112 



W.75 

1.00 

.58 

.58 

.75 



Compared with W. C. rate of fl.OO, 117 to 278 miles, Milwaukee to Wisconsin River 
valley: 



Ohio Coal Traffic As- 










sociation. 


Rutland. O 


Muncio, Tnd 


260 


SI. 40 


'* 


Pomeroy. O 




276 


1.40 




Coalton, () 


" t. 


187 


1.20 


" 


Wellston. O 


•* 


I»3 


1.20 




Columbus. O 


Kalamazoo, Mich .. . . 


275 


1.00 


Northern Pacific 


Duluth, Minn 


Little Falls, Minn... 


148 


1.25 




'' *• 


Sartells. Minn 


149 


1.50 


C. & O. 


Gauley, W. Va 


Hamilton, Ohio 


27C 


1.15 




Hurricane, \V. Va.... 




212 


1.13 




Coal Fork. W. Va.... 


*' •' 


251 


1.15 




(iauley. W. Va 

Hurricane, W. Va.. . 


Lockland, O 


162 
198 


1.00 






1.00 



Compared with W. C. rate of $1.40, 290 to .380 mlle^, Milwaukee to Western Wisconsin. 
8t. Paul and Mpls. 



Ohio Coal Traffic As- 
sociation 



C.&O.. 



Cambridge, O.. 
Massillon. O.... 
Gauley, W. Va. 



Kalamazoo, Mich.. 
Munroe, Mich 



352 
3(H 
385 



1.60 
l.a> 
1.40 



The above rates are in several instances joint interstate rates, 
and the petitioners claim that such rates are not comparable 
with 'the local intrastate rates herein complained of. 

Group rates are sometimes established between one shipping 
point and several consuming points, and at other times, again, 
between one consuming point and several shij^ping points. The 
amount of territory that is included in each group varies with 
the conditions. Theoretically each group should include only 
places with common interests located not too far apart. The 
group system of rate making also seems to be better adapted 
for application between groups located a considerable distance 
apart than between groups located close to each other. There 
is much to be said on both sides of this system of rate making. 
While it is a conveniient system for carriers and often fair as 
between shippers and places, there are also many instances 
wher^ it is not entirely equitable, either as between shippers or 



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WIS. PULP & PAPER MPRS. V. C. & N. W. R. CO. ET AL. 453 

localities. The circumstances surrounding such systems are 
usually such that their fairness can better be determined from 
particular facts than from general rules. 

In the instant case it would seem that the pulp mills on the 
Fox river are so located that, for most rate-making purposes at 
least, they may safely be placed in the same group. The mills in 
this case are not located very far apart. To a considerable ex- 
tendi they obtain their supplies from the same sources. Their 
finished products are also likely to supply very largely the same 
markets. On the other hand, the distances from these mills to 
at least one or two of the points from which coal is shipped 
are so short that it must be confessed that they do not appear 
to lend themselves very readily to the group system of rate 
making. 

The "Wisconsin River mills, while far enough away from the 
coal shipping ports that the objections to group rating that comes 
from shortness of distance is largely obviated, are located so 
far apart that, for coal shipping purposes at least, there are 
some objections to placing them in the same group. This group, 
for instance, extends from Nekoosa to Tomahawk, a distance 
of about 90 miles, which is about equal to the distance between 
the former place and the nearest coal shipping port. From the 
point of view of scientific rates it is not easy to justify rate 
zones that are as wide, or nearly so, as the distance between 
these zones. From a commercial point of view, on the other 
hand, there may be conditions under which such rate groupings 
as these may be warranted. Where such rate arrangements as 
those just described have been in effect long enough to enable 
commercial and market conditions to become adjusted thereto, 
radical changes therein may also cause considerable harm to the 
industries involved. 

Whether the four coal shipping ports involved herein can 
always be fairly placed in the same grouj) for rate-making pur- 
poses, may be an open question. From Milwaukee, the most 
southerly point among them, to Green Bay, the most northerly 
point, the distance by rail is about 112 miles. For long haul 
traffic, points as far apart as these can easily and fairly be 
placed in the same group. But for short distance traffic this 
is not always tnie. For instance, it is difficult to justify a rate 
from Green Bay to a point say fifteen miles away from Green 
Bay that is so high as to be a reasonable rate to the same point 



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454 



RAILROAD COMMISSION OF WISCONSIN. 



from Milwaukee, a distance of say at least 100 miles. These 
difficulties have also been recognized by the carriers themselves, 
at least in some instances, for the rates on coal from Milwaukee 
to nearby points are much lower than the rates to the same 
points from Green Bay, where the distances are much greater. 
These facts, insofar as the present case is concerned, are largely, 
perhaps entirely, offset by the fact that the ports in question 
have been kept on the same rate basis so long as to establish 
conditions that it may not be well to materially disturb at this 
particular time. 

When all the facts are considered, therefore, it would! seem 
that the rates on coal from the four lake ports in question to 
each one of the two mill groups involved should be based on the 
average distance from these po