All  additional  capital  during  the  term  of  the  grant
must  be  carefully  supervised  by  the  city  to  the  end  of
assuring  that  every  dollar  expended  on  the  property
shall  represent  money  actually  invested.  This  super-
vision does  not  necessarily  include  any  measure  of  con-
trol over  the  issue  of  the  company's  securities.  Sec-
tion 5  of  the  Enabling  Act  declares  that  the  Company
"shall  not  sell,  dispose  of  or  pledge  any  shares  of  its
capital  stock,  or  issue  any  certificates  thereof,  for  less
than  ninety-five  per  cent  of  their  par  value,"  nor  issue
any  bonds  except  for  money  at  their  market  value,  in
no  case  to  be  less  than  ninety  per  cent  of  the  par  value.
Local  Interest  Paramount.
I  believe  this  to  be  a  mistaken  attempt  to  apply  to
a  city  government  the  present  and  prevailing  scheme  of
control  of  public  utility  securities  through  state  public
service  commissions.  I  do  not  regard  this  provision
as  necessary  to  protect  public  interests,  or  as  a  wise
exercise  of  municipal  authority.  The  big  purpose  of
a  public  utility  contract  is  to  direct  the  relations  be-


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tween  the  utility  and  the  community  which  it  serves.
I  cannot  admit  that  it  should  include  protection  of  in-
vestors representing  the  'four  comers  of  the  earth  who
are  voluntary  purchasers  of  the  utility's  securities.
The  charge  imposed  for  the  service,  especially  street
railway  transportation,  should  not  be  a  matter  wholly
for  experts  to  determine.  The  rate  of  fare  necessarily
will  depend  to  some  extent  on  other  provisions  of  the
ordinance — valuation,  rate  of  return  upon  capital  in-
vestment, inclusion  of  the  profits  feature,  etc.  Public
policy  should  be  considered  and  public  opinion  con-
sulted.
