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A.-3&S7aa ?/ir-//-7- 8061'iz-mr'Hd 'A "N 'ssnaBj^sl •sojg pjox^BO I Majority and jVIinority Report OF The Special Committee §ti Public TO^ of tlie Fort2r*iunith General Assembly of tthe State of filinois' ,, TOGETHER WITH A Draft o¥ a Bill tp Provide^Locar Col^iti^l of Public U^^^ m tl^e City of Chicago JAllUAiaY 20, 1917 MEMBERS OF f HE COMMltTBE^' f- TfjaOM^ N. iGOBMAN SOtOMOlir BOBEEICK EDWARD D. SHURTLEFr SpRAlfK If. DALTON ' \ ' -FRJEOEipC R. DE YpUNG GJ^BGltt; HILTON -r". "^ S^f^#Ma' i^' '- tl*^"-^^*, '"' 4"*o"rlty of , the ' SlC_§it« Jof vtlillWBis. } -^ ..jil^i^ ^^smmBi Cornell University Library HD2767.I55 C5 1917 Majority and minority '■f,RSI[J||,8|||,|||MS||i|HP^'' 3 1924 030 065 399 The original of this book is in the Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924030065399 Majority and Minority Report OF The Special Committee on Public Utilities of the Forty-ninth General Assembly of the State of Illinois TOGETHER WITH A Draft of a Bill to Provide Local Control of Public Utilities in the City of Chicago JANUARY 20, 1917 MEMBERS OF THE COMMITTEE Medill McCORMICK, Chairman THOMAS N. GORMAN SOLOMON RODERICK EDWARD D. SHURTLEFF FRANK R. DALTON FREDERIC R. DE YOUNG GEORGE C. HILTON PRESTON KUMLER, Counsel [Printed by authority of the State of Illinois.] ScHNBPP & Barnes, State Pbinters Sphingpield, III. 1917. jr MINUTES OF MEETINGS. Minutes of a meeting of the Special Committee on Public Utili- ties of the Forty-ninth General Assembly, held on January 20, 1917, at Chicago. Present: Mr. McCormick, Chairman, and Messrs. Shurtleff, DeYoung, Roderick, Dalton and Hilton. Absent: Mr. Gorman. , Mr. Kumler, counsel for the committee, presented to the commit- tee a draft of a report and a draft of a bill, referred to in the report. After discussion, it was moved and seconded that the following resolution be adopted: "Resolved, That the committee adopt the report as submitted by the counsel for the committee, provided that members of the com- mittee may note exceptions thereto." The motion being put to a vote, a majority of the committee voted in' favor of the resoluton, which thereupon was declared by the chairman to have been adopted. Thereupon the committee adjourned. I do not join in all of said report — Edward D. Shurtleff. RESOLUTION. Adopted by the Committee on January 30, 1917. Resolved, That the committee adopt the report as submitted by the counsel for the committee, provided that members of the com- mittee may note exceptions thereto. REPORT. To the House of Representatives of the Fiftieth General Assembly of the State of Illinois: During the closing days of the Forty-ninth General Assembly, a resolution was adopted by the House of Representatives, providing for the appointment of a special committee of seven, to be designated by the Speaker from the membership of the House Committee on Public Utilities, to investigate and report on the problem of the control and development of public utilities in Illinois. Pursuant to such resolution, the Speaker appointed the following committee: Medill McCormick, chairman, TThomas N. Gorman, Edward D. Shurtleff, Frank R. Dalton, Frederic R. De Young, Solo- mon Roderick and George C. Hilton; Preston Kumler, of Chicago, was appointed by the committee to act as its counsel. This committee, during the month of April, 1916, conducted pub- lic hearings in East St. Louis, Danville, Peoria, Rock Island, and Ottawa. Notices of the proposed hearings were sent to the officials of the several cities in which hearings were held and of neighboring municipalities, to members of the Legislature, to the officers of Cham- bers of Commerce and other similar bodies, and to operators of public utilities, and the hearings also were given wide publicity through the press. The sessions were well attended and more than fifty persons took advantage of the opportunity to express their views before the commit- tee. A complete stenographic record of the proceedings of the com- mittee accompanies this report. A feature of the committee's investigation upon which particular stress was laid, was the attitude of the people of the State towards the control of public utilities, in the State at large and in the city of Chi- cago, by the State Public Utilities Commission. However, suggestions were inyited upon any matter bearing on the control of public utilities and with reference to amendments to the present law. Taking up first the suggestions bearing on matters other than the question of control by the State Public Utilities Commission, the com- mittee makes the following observations and recommendations : 1. Control of accounts of municipally owned utilities.] There is a widespread feeling among the operators of public utilities throughout the State that it is not only unjust to them but also unsound in principle to permit municipally owned utilities to conduct their oper- ations free from any supervision by the State Public Utilities Commis- sion. The committee is inclined, in some measure, to agree with this position, and recommends that, by appropriate legislation, the State Public Utilities Commission be authorized to prescribe the manner in which the accounts of municipally owned public utilities shall be kept. 2. Hearings by the state commission.] The committee finds that there is considerable dissatisfaction among the citizens of the smaller municipalities because they are required to go to Springfield or Chicago in order to present their cases before the commission. The present plan, they urge, puts the smaller municipalities at a disad- vantage in requiring them, at a burdensome expense, to send their representatives and witnesses to Springfield or Chicago. The committee, therefore, recommends that the State Public Utilities Commission take up for serious consideration the question raised by such complaints, with a view to modifying its practice with reference to hearings so as to render the commission more easily acces- sible to the citizens of the smaller municipalities. 3. Amendment of provisions governing appeals.] The com- mittee recommends that the provisions of the Act of 1913 with refer- ence to appeals from orders of the Commission be clarified. 4. Regulation of elevator leases.] The committee recom- mends that the General Assembly consider the advisability of extending the powers of the State Public Utilities Commission over grain elevators, and in particular the powers of the commis- sion with reference to leases of elevators located along the rights of way of railroads. DOWN state utilities AND STATE CONTROL. With reference to the attitude of the people outside the city of Chicago towards the control of down State utilities by the State Public Utilities Commission, the committee finds that the scheme of control introduced by the Act of 1913 has met with almost universal approval. While " some complaints were heard, particularly with reference to delays in matters pending before the State commission, the general feeling throughout the State is that the control of utilities outside the City of Chicago by the State commission is working, well, and the people would be more than reluctant to return to tne old system. Through the agency of the State commission and its corps of experts, the people of the smaller municipalities and the rural dis- tricts are now able to meet on equal terms the utilities with their great resources. Not only is the committee convinced that the people outside of the City of Chicago would be unwilling to return to the old system, but also that there is no disposition outside of the City of Chicago to attempt to secure comprehensive local con- trol through new powers to be conferred by legislation on municipalities other than Chicago. DOWN STATE ATTITUDE ON CHICAGO HOME RULE. With reference to the attitude of the people of the State out- side of the City of Chicago on the proposal to grant home rule to Chicago in public utility matters^a proposal urged before the Legislature in 1913 and in 1915 and again earnestly advocated at this time — the majority of the committee is satisfied, notwithstanding the fact that views to the contrary have been expressed, that the people of the State at large are on the whole indifferent on the sub- ject, and are quite willing to have the Legislature grant home rule to Chicago if the people of Chicago so desire. CHICAGO HEARINGS. During the month of December, the committee conducted hearings in Chicago at which the mayor of Chicago, representative members of the Chicago and Evanston City councils, representa- tives of Chicago utilities and others, were given an opportunity to express their views. Mr. Samuel Insull, president of the Commonwealth Edison Company, chairman of the Board of Directors of the People's Gas Light & Coke Company, and chairman of the Boards of the Ele- vated Railroads, and Mr. William G. Beale, attorney for the in- terests represented by Mr. Insull, appeared before the committee and expressed the view that the control of Chicago utilities should continue to be exercised by the State Public Utilities Commission. On the other hand, Mr. Leonard A. Busby, president of the Chi- cago Surface Lines, who has been in almost constant negotiations with the Local Transportation Committee of the City Council, be- cause of the control over service requirements vested in the coun- cil by the ordinances of 1907, earnestly advocated home rule for Chicago through the city council. committee's general conclusions with reference to home rule for chicago. A majority of the committee are clearly of the opinion that legislation should be enacted granting home rule to Chicago in public utility matters. Without entering upon a presentation of the familiar argu- ments in favor of local control of public utilities, it will be profit- able to set forth certain important facts with reference to the public utility situation in Chicago. (1) Volume of public utility business in Chicago.] The pub- lic utihty business in the City of Chicago comprises a large proportion of the business done by public utilities in the entire State. According to figures compiled by Alderman Charles E. Mer- riam and set forth in the able and comprehensive brief filed by him with the committee, there were in the year 1916, 655,319 gas consumers in Chicago as compared with 249,793 consumers in the State outside of Chicago : in the year 1914 the revenue received from patrons of street cars in Chicago amounted to $31,861,333, as compared with $4,986,499 (less than one-sixth) received by all the other street car companies in the State. The down State figures as to telephone sub- scribers and consumers of electricity are not available; there are, however, in Chicago 425,000 telephone subscribers and 302,899 users of electricity. 6 The total capitalization of utility companies in Illinois, ex- cluding railroads, is about $835,000,000, of which approximately $525,000,000 is in Chicago. (2) Chicago utilities entirely or primarily within city LIMITS.] The utilities which Chicago seeks power to regulate are en- tirely or primarily within the corporate limits of the city, and are therefore appropriate objects of local regulation. The figures as to revenue are as follows : Total Chicago Outside business. business. Chicago. Surface lines (1915) $31,690,762 100% 0% Elevated lines (1915) 8,888,946 94% 6% Commonwealth Edison Co. (1915) 20,882,327 100% 0% Peoples Gas Light & Coke Co. (1915).... 17,037,804 100% 0% Chicago Telephone Co. (1911 — figures for 1915 are not available) 12,474,022 83.5% 16.5% The Chicago utilities are within the limits of the municipality to a much greater extent than the Illinois utilities (which the State com- mission regulates) are within the limits of the State. The Chicago Telephone Co. has 10,557 subscribers outside of Illinois who are not subject to the jurisdiction of the State Public Utilities Commission. (3) Concentration of utility business.] The Commonwealth Edison Company controls the Peoples Gas Light and Coke Company and three of the four elevated lines (Mr. Insull being receiver of the fourth), and upon the consummation of the proposed merger of the surface and elevated lines, all of the utility companies in Chicago, except the Telephone Company, will be combined under one control with a capitalization of perhaps $500,000,000 and with 30,000 em- ployees. In the meantime concentration of control is obtained by means of interlocking directorates which insure common understandings at all times and practically solidify the government of all the great local utilities of the city. In meeting this powerful force, the committee is satisfied that the concentrated public opinion of those in every day contact with the Chicago utilities will be more potent than the influence of the people of the State at large, a considerable proportion of whom have no personal interest whatever in Chicago utilities. (4) Conflicting claims to jurisdiction.] Contract ordinances, passed prior to the enactment of the Act of 1913, creating the State Public Utilities Commission, provide that the city shall have the right to regulate the service of the surface lines and the rates and service of the Telephone Company and the Commonwealth Edison Company. It is now contended that these powers of the city were abrogated by the Act of 1913. The State Public. Utilities Commission has gone so far as to order the surface lines to attach trailers to their cars during rush hours — this in spite of the fact that the use of trailers is expressly forbidden by the ordinances of 1907. The power of the commission to pass the order was denied in a recent decision by Judge Taylor, of the Circuit Court of Cook County, and the State commission has taken an appeal. The conflicting claims to jurisdiction, resulting in endless confu- sion and uncertainty, should be settled and the rights reserved to the city in. the contract ordinances above referred to should be reaffirmed. SCHEMES OF HOME RULE FOR CHICAGO. ' Two alternative schemes of home rule for Chicago have been suggested, the first contemplating control through a commission to be appointed by the mayor, and the second contemplating control through the city council, with power in the city council to create a commission or commissions to be appointed in a manner to be pre- scribed by the council. It is argued in favor of the second plan that Chicago is pre-em- inently a council-governed city; that the City Council of Chicago in the past has shown capacity to deal with public utility problems — notably, in the case of the traction ordinances of 1907, and in the pending plan to provide a comprehensive scheme of transportation for the city; that while there are, as everyone knows, certain weak and corrupt men in the council, still in recent years the personnel of the council has been such as to give assurance that questions affecting the control of pubic utilities will receive fair and intelligent consider- ation at its hands ; that during the past ten years the council has com- manded the services of better and more experienced engineers, ac- countants and lawyers than any utilities commission in the United States ; that the people of Chicago, through their representatives in the council should be permitted to determine whether the control of their utilities shall be in the hands of the council itself (to be exercised through standing committees such as the Committees on Local Trans- portation and Gas, Oil and Electricity) or shall be delegated to a commission or commissions to be created by the council ; that the creation by the council of the Boards of Supervising Engineers, the Railway Terminals Commission and the Department of Public Service, indicates that the council will, if the pubhc good requires, provide machinery for the exercise of its powers through the creation of able and fair minded commissions, boards or departments ; and that with the ultimate control of public utilities vested in the city council, men of greater strength and intelligence will be attracted, by this added authority and responsibility, to seek places in the council, thus se- curing a better government for the city in matters other than those relating to public utilities. BILL SUBMITTED. While there prevails in the committee a difference of opinion as to whether the control of Chicago's utilities can be most advantag- eously administered through the city council, a majority of the com- mittee, are clearly of the opinion that there should be submitted to the Legislature a bill embodying the principle of council control expressed in the bill submitted to the General Assembly by the City Council of Chicago in 1915. To this end the committee has had the bill of 1915 redrafted by its counsel, with a view to meeting objections sug- 10 gested by a further consideration of the whole subject, and submits the redrafted bill with this report. It will be noted that the proposed bill contains a referendum clause, so that if the bill is enacted by the Legislature, it will not become effective in the City of Chicago unless it is approved by the voters of the city. Attached to this report are copies of two briefs submitted to the committee, the first submitted by the Mayor and Corporation Coun- sel of the City of Chicago, the second by Alderman Charles E. Mer- riam of Chicago. A BILL Foe An Act to authorise and empower cities now having, or which may hereafter have, a population of two hundred thousand (200,000) or more to provide for the regulation of public utilities. Section 1. Be it enacted hy the People of the State of Illinois, repre- sented in the General Assembly: Powek oveb local tjtilities.] That cities of thiis State now having, or which may hereafter have, a population of two hundred thousand (200,000) or more shall have power and authority: (1) To determine and prescribe terms and conditions upon which any public utility may be permitted to occupy or use the streets, highways or other public property or operate in, upon, across, along, over or under the same within the city; but the exercise of such power as to granting the occu- pancy or use of streets, highways, or other public property, to any steam, elevated, street or other railroad, shall be subject to all laws of the State requiring frontage consents of abutting property owners; (2) To regulate the quality, adequacy and safety of any service, product or commodity rendered or furnished within such city by any public utility operating wholly or mainly or primarily therein; to require any such public utility to make such additions, extensions, repairs, improvements, locations, relocations or changes in or to its plant, equipment or property within such city and to provide such facilities as shall be reasonable and necessary in the interest of the public; and to designate the location and nature of all such additions, extensions, repairs, improvements, locations, relocations, facili- ties or changes, the time within which they must be completed, and the man- ner in which they must be constructed; (3) To determine and prescribe just and reasonable rates or other charges for any service, product or commodity, rendered or furnished within such city by any public utility operating wholly or mainly or primarily therein, and to prevent unjust and unreasonable discriminations in rates or other charges and in services within such city by any such public utility; (4) To examine public utilities operating wholly or mainly or primarily within such oity and to keep informed as to their condition, the manner and method of conducting their business, and their compliance with the pro- visions of law, with the requirements of their charters, franchises, licenses or permits, and With any order, ordinance, contract ordinance, direction, rule, regulation or requirement of such city. (5) To adopt all reasonable and proper rules and regulations relative to the exercise of their powers, and to regulate the method and manner of all investigations and hearings and to alter and amend the same; But no such city shall, by ordinance, franchise, license, permJit, or other- wise, contract with any public utility so as to divest itself of or limit its power of regulating such public utility, or so as to divest itself of any right or power, which now exists or may hereafter be granted or authorized by law, to acquire, own or operate, any public utility. § 2. Boards and commissions.] The powers of regulation and con- trol over public utilities within any such city, hereby conferred upon the city to the extent that they are executive, administrative or quasi-judicial, may, if the city council in its discretion shall so provide, be exercised by a 11 board or boards, a commission or commissions, or a commissioner or com- missioners, in accordance with the provisions of an ordinance or ordinances creating and providing for the same, and the city council of any such city shall have full power and authority, in its discretion, by ordinance, to estab- lish such boards, commissions or commissioners, as in its judgment may be necessary, and to provide the method of appointment thereto, the terms of office of the members thereof, their compensation, and fully to regulate and define, in all respScts, the powers, duties, authorities and procedure of any such boards, commissions, or commissioners thus created or appointed in accordance with the terms of this Act. § 3. Valuation.] Such cities shall have power and authority to ascer- tain the value of the property of public utilities operating wholly or mainly or primarily therein, and every feature which may or does fiave any bearing on such value. In making such valuation, the city may avail itself of any information, books, documents or records in the possession of any office, department, board or commission of the state or of any subdivision thereof. Such cities shall have power to make re-valuations from time to time and also to ascertain the value of all new construction, extensions and addi- tions to the property of every such public utility. § 4. UTiLiTres to comply with the bec^jests and obey ordb31s of city.] Every public utility operating wholly or mainly or primarily within any such city shall furnish to the city all information required by it to carry into effect the provisions of this Act, and shall make specific answers to all questions submitted by the city council or by an authorized agent of the city, and cause to be properly filled out and verified any blanks received from the city or from an authorized agent of the city, with directions to fill the same, so as to answer fully and correctly each question therein pro- pounded. The expression "authorized agent of the city," in this connection and elsewhere in this Act, shall include any board, commission and com- missioner appointed pursuant to the provisions of Section 2. Whenever required by the city council or by any authorized agent of any such city, every public utility operating wholly or mainly or primarily within such city, shall deliver to the city council or to such authorized agent of the city, any or all maps, profiles, contracts, reports, documents, books, accounts, papers and records in its possession or in any way relating to its property or affecting its business within such city, and inventories of its property in such form as the city may direct, or verified copies of any or all of the same. Every public utility operating wholly or mainly or primarily within any such city shall obey and comply with each and every requirement of every order, ordinance, contract ordinance, direction, rule or regulation, made or prescribed by the city in any way relating to its business as a public utility, and shall do everything necessary or proper to secure compliance with and observance of every such order, ordinance, contract ordinance, decision, direction, rule or regulation by or of its officers, agents and em- ployees. § 5. Other than public utility business.] In case any public utility operating wholly or mainly or primarily within any such city is engaged in carrying on any business other than that of a public utility, the city coun- cil or an authorized agent of the city may examine and inspect the books, accounts, papers and records of such other business, in so far as may be necessairy to exercise the power and jurisdiction of the city over such public utility. The city shall have power to inquire as to and determine the proper proportion of earnings, debts and expenses, fairly or justly to be awarded or borne by the ownership, operation, management or control of such public utility as distinguished from such other business, in so far as may be necessary to exercise its power and jurisdiction over such public utility. § 6. Copies of repoets — brkoneous reports — penalties.] Every public utility operating wholly or mainly or primarily within any such city shall file with the city copies of all reports made by such public utility to the State Public Utilities Commission. The city shall have authority to require 12 any such public utility to file monthly reports of earnings and expenses of such, public utility and to file other periodical or special, or both periodical and special reports, concerning any matter about which the city is authorized by law to keep itself informed. All reports shall be under oath. When any report is erroneous or defective, or appears to the city, or an authorized agent of the city, to be erroneous or defective, the city or such agent of the city may notify the public utility to amend its report within thirty (30) days, and before or after the termination of such period the city, or such agent of the city, may examine the officers, agents or employees, and books, records, accounts, vouchers, plant, equipment and property of such public utility and correct such items in such report as upon such examination the city or authorized agent of the city may find defective or erroneous. Any public utility which fails to make and file any report called for by the city or an authorized officer or agent of the city within the time it is lawfully required so to do; or to make specific answer to any question pro- pounded by the city or such officer or agent of the city within the time it is lawfully required so to do, shall forfeit one hundred ($100.00) dollars for each and every day it may be so in default. Any person who wilfully, makes any false return or report to the city or an authorized agent of the city, and any person who aids or abets such person shall, upon conviction, be subject to imprisonment in the county jail not exceeding one year or to a fine not exceeding one thousand ($1,000.00) dol- lars, or both, at the discretion of the court. § 7. Notice to city on application for approval of securities.] When- ever any public utility operating or proposing to operate wholly or mainly or primarily within any such city, shall make application to the State Public Utilities Commission for the approval of any issue, sale, pur- chase or acquisition of stocks, stock certificates, bonds, notes or other evi- dences of indebtedness or for the approval of the capitalization of any merger or consolidation of such public utility, wlith any other public utility, a notice of such application shall be given to the city by the State Public Utilities Commission, and the city shall receive notice and be entitled to appear and to present evidence and to be heaxd at the hearing held by the State Public Utilities Commission on any such application. § 8'. IntercoiRporate relations.] Unless the consent of the city is first obtained : (1) No two or more public utilities, one or more of which operates or proposes to operate wholly or mainly or primarily within any such city, may enter into contracts with each other that will enable such public utilities to operate their lines or plants within such city in connection with each other; (2) No public utility may purchase, lease or in any other manner acquire control, direct or indirect, over the franchises, licenses, permits, plant, equip- ment, business or other property oi any other public utility operating or proposing to operate wholly or mainly or primarily within any such city; (3) No public utility operating wholly or mainly or primarily within any such city may assign, transfer, lease, mortgage, sell or otherwise dispose of or encumber the whole or any part of its franchises, licenses, permits, plant, equipment, business or other property within such city, or make any contract or agreement with reference to or affecting any such franchises, licenses or permits, but this shall not be construed to prevent the sale, lease, assignment or transfer, in the due and ordinary course of business, of any tangible per- sonal property, which is not necessary or useful in the performance of its duties to the public; (4) No public utility operating wholly or mainly or primarily within such city may by any means, direct, or indirect, merge or consolidate its franchises, licenses, permits, plant, equipment, business or property within such city with that of any other public utility. Such consent and approval shall not be construed to revive or validate any lapsed or Invalid franchise, license, permit or right, or to enlarge or add to the powers and privileges contained in the grant of any franchise, license, permit or ri.ght or to waive any forfeiture. 13 Any transaction referred to In this section requiring the consent and approval of any such city, made without such consent and approval, shall be void. § 9. Schedules of rates — copies of contracts.] Every public utility operating wholly or mainly or primarily within any such city shall publish, post and file With the city copies of all schedules of rates or other charges, and classifications for any service, product or commodity furnished or ren- dered within the city, as nearly as may be in accordance with the provisions of Sections 33 and 34 of an act entitled, "An Act to Provide for the Regu- lation of Public Utilities," approved June 30, 1913. Every such public utility shall file with the city copies of all contracts, agreements or arrange- ments with other public utilities with relation to any service, product or commodity rendered or furnished within such city. § 10. RiapORTS OF ACCIDENTS.] Every public utility operating wholly or mainly or primarily within any such city shall promptly file with the city a report of every accident to, on, in or about its plant, line, track, equip- ment or other property affecting its service within the city or which results in loss of life or injury to any person or property or is of such a nature as to endanger the safety, health or property of any person: Provided, that no such report filed with the city shall be admitted in evidence in any action based on or arising out of the loss of life, or injury to person or property in this section referred to. § 11. Copies op documents shall be evidence.] Copies of all oflScial documents and orders filed or deposited With any such city and certified by the city clerk or other authorized agent of the city to be true copies of the originals, shall be evidence in like manner as the originals. § 12. Joint rates — transfers.] Whenever any such city, after a hear- ing, shall find that the rates or other charges, or classifications in force within said city over two or more public utilities operating wholly or mainly or primarily therein are unjust, unreasonable or excessive, or that no satisfactory through route or joint rate or other charge or classification exists, and that the public convenience and interest demand the establish- ment of a through route or joint rate, the city may order such public utilities to establish such through route, or may fix a joint rate or other charge or classification which shall be just and reasonable, and the terms and conditions under which such through route or joint rate shall be operated. Whenever any such city, after a hearing, shall find that the rules, regu- lations and practices of any public utility engaged in the transportation of persons, or two or more such public utilities, operating wholly or mainly or primarily therein, as to the use of transfer tickets for the transportation of persons over two or more lines of such common carrier or common carriers on payment of a single fare, are unjust and unreasonable, or that no trans- fer privileges are in force over such lines, the city shall have power to de- termine and prescribe just and reasonable regulations for the issuance and use of such transfer tickets, and may, in its discretion, prescribe the num- ber of successive transfer tickets to be given to a passenger paying a single fare, and provide for the proper use and place of use by each passenger of such transfer tickets issued for a single fare for one continuous trip over the lines of such common carrier, or common carriers. § 13. Greater charge may not be made for less service.] No public utility operating wholly or mainly or primarily within any such city shall, without the consent of the city, charge or receive any greater compensation in the aggregate for a lesser commodity, product or service than for a greater commodity, product or service of like character. § 14. Track connections.] Whenever any such city shall find, after a hearing had upon complaint, or upon its own motion, that the public con- venience and necessity would be subserved by having track connections made within the city between any two or more street railroads, the city shall have authority to order any such street railroads to make physical con- nection at any or all crossings, and at all points within, the city where a street railroad shall begin or terminate at or near any other street rail- 14 road, so that the cars of such street railroad company may bo speedily trans- ferred from one street railroad to any other street railroad, to the end that through routes and joint rates may be established, and shall have power to order whether the expense thereof shall be borne jointly or otherwise. § 15. Adequacy op transpoktation service.] Whenever any such city, after hearing had upon its own motion or upon complaint, shall find that within such city any public utility engaged in the transportation of persons or property and operating within or mainly or primarily within such city, does not run or operate a sufficient number of cars or other vehicles of trans- portation, or possess or operate sufficient motive power, reasonably to accom- modate the traffic, passenger or freight, transported by or offered for trans- portation to it, or does not run its cars or other vehicles of transportation with sufficient frequency or at a reasonable or proper time, having regard to safety, or does not stop the same at proper places, or does not run any car. or cars or other vehicles of transportation upon a reasonable time schedule for the run, such city shall have power to direct any such street railroad company or other common carrier to increase the number of its cars or other vehicles of transportation or its motive power or to change the time for starting its cars or other vehicles of transportation or to change the time schedule for the run of any car or other vehicle of transportation, or to change the stopping place or places thereof, or to put into effect any other require- ment that such city may determine to be reasonably necessary to accommo- date and transport the traffic, passenger or freight, transported or offered for transportation within such city. § 16. Standards of sbevicb — inspections.] Such cities shall have power to ascertain, determine and fix for each kind of public utility operating wholly or mainly or primarily therein, suitable and convenient standard commercial units of service, product or commodity, and an adequate and serviceable standard for the measurement of quantity, quality, pressure, initial voltage or other condition pertaining to the performing of its service or the fur- nishing of its product or commodity by any such public utility. Such cities shall have power to prescribe regulations for examining, measuring and testing such service, product or commodity, and to provide for the inspection of the manner in which public utilities operating wholly or mainly or primarily therein, conform to the regulations provided by such cities for examining, measuring and testing their service, products or com- modities; and such cities may supplement such inspections by examining, measuring and testing the service, product or commodity of any such public utility. Such cities may provide for testing any appliance used for examining, measuring or testing any service, product or commodity and may fix and establish fees for testing such appliances, and may make regulations as to the payment of such fees. Any officer, agent or employee of any such city, duly authorized by the city, shall have power to enter upon any premises occupied by any public utility operating wholly or mainly or primarily therein, for the purpose of making the examinations and tests provided for in this section, and to set up on such premises appliances and apparatus and occupy reasonajble space therefor. § 17. Complaints and investigations.] On complaint to the city against any public utility operating wholly or mainly or primarily therein, by any person or corporation, of anything done or omitted to be done in violation of this act, or of any order, ordinance, contract ordinance, direction, rule or regulation made under the authority thereof, the city, or an authorized agent of the city, unless such complaint is known to be not well founded;- shall cause a statement of the complaint to be forwarded to the public utility com- plained of, which shall be called on to satisfy the complaint or to answer the same in writing within a time to be specified by the city or such agent of the city. The city shall provide for the investigation of such complaints in all cases where there shall appear to be reasonable ground for such investi- gation. 15 § 18. Witnesses — immunity — inspection op books, accounts and phys- ical PKOPEBTY.] In the exercise of its powers over public utilities subject to the jurisdiction of any such city, the city or any officer of the city author- ized by ordinance or resolution, shall have authority to issue subpoenas and compel the attendance of witnesses, to administer oaths and affirmations, and to inspect and require the production of the books, papers, accounts, documents, and to enter and inspect the plant, equipment and other property, of any such public utility. Information so obtained shall not be admitted in evidence or used in any proceedings except in proceedings provided for in this act. A subpoena issued as aforesaid shall be served in the same manner as a subpoena issued out of a court of record. The depositions of witnesses residing within or without the State may be taken in the manner prescribed by law for like depositions in civil actions in the courts of this State. Fees for the service of subpoenas and for the attendance of witnesses shall be the same as in the Circuit Courts of the State, and shall be paid by the city if the subpoena is issued at the instance of the city and by the public utility if issued at the instance of the public utility. No person shall be excused from testifying or from producing any papers, books, accounts or documents in any investigation or inquiry or upon any hearing ordered by the city, when ordered to do so by the city, or by an authorized officer of the city, upon the ground that the testimony or evidence, documentary or otherwise, may tend to incriminate him or sub- ject him to a penalty or forfeiture. But no person shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter or thing concerning which he may testify or produce evidence, docu- mentary or otherwise, in any such investigation, inquiry or hearing; pro- vided, that such immunity shall extend only to a natural person, who in obedience to a subpoena, gives testimony under oath or produces evidence, documentary or otherwise, under oath. No person so testifying shall be exempt from prosecution and punishment for perjury committed in so testifying. Any witness duly subpoenaed unde? this section, who shall refuse or neglect to appear, to produce books, papers, accounts or documents, to make oath or affirmation, to testify; or any officer, agent or employee of a public utility subject to the jurisdiction of the city who shall refuse to permit the inspection of the books, pajpers, accounts, documents or records or the plant, equipment, or other property of such public utility, shall be guilty of a mis- demeanor, and upon conviction thereof shall be punished by a fine of not to exceed one thousand ($1,000.00) dollars, or by imprisonment in the county jail not more than six months, or both in the discretion of the court. Any Circuit Court of this State, or any court of concurrent jurisdiction, or any judge thereof, either in term time or vacation, upon application of any such city, or of an authorized officer of such city, may in his discretion, by order direct the attendance of witnesses, the production of books, papers, accounts and documents and the giving of testimony in any such investiga- tion, inquiry or hearing, and enforce such order by an attachment for con- tempt, or otherwise. § 19. Utilities extending outside such cities.] In the case of public utilities engaged in the transportation of persons or property or the tele- phone business mainly or primarily within any such city, but with lines extending outside of such city, the State Public Utilities Commission shall have full power and authority over the rates or other charges and the service of such public utilities for or in connection with service between points within such city and points outside such city. § 20. City ordinances prima facie reasonable — appeals — expedition of CASES.] Any order or ordinance passed by the city council of any such city, or any order, direction, rule or regulation issued by an authorized agent of the city, or by a board or commission appointed under the authority of this act, establishing rates or other charges for any public utility, or establishing regulations as to additions, extensions, repairs, improvements, locations, relocations, facilities or changes, or as to the quantity, quality or safety of 16 any service, product or commodity witliin the limits of the city for any public utility shall be. and be deemed to be prima facie reasonable. Nothing in this act contained shall have' the effect of limiting the right of any public utility affected by any order, ordinance, direction, rule or regulation, passed, entered or made under the authority of this act, from seeking relief in the courts from the operation and effect of such order, ordinance, direction, rule or regulation. Any proceeding in any court in this State directly affecting any such order, ordinance, decision, rule, regu- lation or requirement, shall have priority in hearing and determination over all other civil proceedings pending in such court, except election contests. § 21. Penalties.] Any public utility or any person or corporation w^hich shall violate or fail to comply with any provision of this act or with any order, ordinance, direction, rule or regulation of any such city or an au- thorized agent of such city, or a board or commission hereinabove in Sec- tion 2 provided for, made or issued under authority of this Act, in any case in which a penalty is not otherwise provided for in this Act, shall, upon conviction, be subject to. a fine not exceeding two thousand ($2,000.00) dollars, for each and every offense. Any person who, either individually or acting as an officer, agent or employee of a public utility, or of a corporation other than a public utility, violates or fails to comply with any provision of this Act or with any order, ordinance, direction, rule or regulation of any such city, or of an authorized agent of such city, or any such board or commission, made or issued under authority of this Act, in a ease in which a penalty is not otherwise provided for in this Act, Is guilty of a misdemeanor, and, upon conviction, shall be punished by a fine of not more than one thousand ($1,000.00) dollars, or by Imprisonment in the county jail for not more than one year, or by both such fine and imprisonment. Every violation of any such provision, order, ordinance, direction, rule or regulation, or any part or portion thereof, by any corporation or person, is a separate and distinct offense, and in case of a continuing violation each day's continuance thereof shall be p.nd shall be deemed to be a separate and distinct offense. All penalties under this act shall be cumulative and suit for the re- covery of one penalty shall not be a bar to or affect the recovery of any other penalty or be a bar to any criminal prosecution against any public utility, or any officer, director, agent or employee thereof, or any other corporation or person. § 22. Actions to kecoveb penalties.] All actions to recover fines and penalties under this act shall be brought in the name of such city and the amount recovered shall be paid into the city treasury to the credit of the general fund. § 23. Application by city to state public utilities cokmission.] Any such city may, by order or resolution, apply to the State Public Utilities Commission for any information or data necessary or useful in the exercise of its powers over public utilities operating wholly or mainly or primarily within such city, for the assistance of experts and other agents of the com- mission in the investigation of any such public utility by such city or for an investigation by the commission as to the rates or other charges or the quality, adequacy or safety of service or product furnished by any such public utility within such city. Upon such application, it shall be the duty of the commission to furnish such information or data, or the assistance of experts and their agents, or to conduct the investigation, as the case may be, within a reasonable time, not to exceed six months after receipt of such application; and for the purpose of securing such information or data or conducting such investigation, the commission shall be vested with all the powers and such public utility shall be subject to all the duties, obligations, and liabilities as in the case of public utilities subject to the jurisdiction of the commission. § 24. Definitions.] The term "public utility," when used in this Act, means and includes every corporation, company, association, joint stock 17 company or association, ma^iaging committee, firm, partnership or indi- vidual, tiieir lessees, trustees, or receivers appointed by any court whatsoever (except, however, such public utilities as are or may hereafter be owned or operated by any municipality) that now or hereafter: (a) May own, control, operate or manage, directly or indirectly for public use, any plant equipment or property used or to be used for or in con- nection with the transportation of persons or property or the transmission of telegraph or telephone messages, or for the production, storage, transmis- sion, sale, delivery or furnishing of heat, cold, light, power, electricity or water; or for the conveyance of oil or gas by pipe line; or for the storage or warehousing of goods; or for the conduct of a business of a wharfinger; or that (b) May own or control any franchise, license, permit or right to engage in any such business. The term "service," when used in this Act, is used in its broadest and most inclusive sense, and includes not only the use or accommodation afforded! consumers or patrons, but also any product or commodity furnished by any public utility and the plant, equipment, apparatus, appliances, property and facilities employed by, or in connection with, any public utility in perform- ing any service or in furnishing any product or commodity and devoted to the purposes in which such public utility is engaged and to the use and accommodation of the public. The term "rate," when used in this Act, includes every individual or joint rate, fare, toll, charge, rental or other compensation of any public utility or any two or more such individual or joint rates, fares, tolls, charges, rentals or other compensation of any public utility or any schedule or tariff thereof, and any rule, regulation, charge, practice or contract relating, thereto. § 25. Construction.] Such cities shall have, in addition to the powers herein specified, mentioned or indicated, all additional, implied and inci- dental powers, which may be proper and necessary to effectually carry out,, perform and execute all the said powers herein specified, mentioned or indi- cated. § 26. Expression of paeticular powers not an exclusion of other. POWERS NOT EXPRESSED.] The Conferring and expression of particular or special powers set forth in any of the sections of this Act shall not be held or construed to limit, modify, restrict or exclude any other particular or special powers not expressly set forth but which may be reasonably held and construed to be contained in any expression of general powers set forth in any of the sections of this Act. § 27. Saving clause.] Nothing in an act entitled, "An Act to Provide: for the Regulation of Public Utilities," approved June 30, 1913, shall be con- strued to limit or restrict the powers of such cities to pass ordinances for the protection of the public health, safety, comfort and general welfare, or gov- erning the regulation, control or occupation of streets, highways and public property within the city. § 28. Mayor and jiembers of council not to be interested, in public UTILITIES — PENALTY.] No mayor nor any member of the council of any such: city, nor any member of a board or commission created pursuant to tha authority conferred by Section 2 of this act, shall be interested, directly or indirectly, in any public utility subject to the jurisdiction of sucn city, nor in any franchise, grant or privilege conferred by such city. Any mayor or member of the council, or member of any such board or commission, assuming or retaining office subject to the disqualifications of this section, shall be deemed guilty of a misdemeanor, and shall be punish- able by a fine of not less than one thousand ($1,000) dollars nor more than five thousand ($5,000) dollars, or by imprisonment in the county jail for not less than three (3) months nor more than one (1) year, or by both such fine and imprisonment, in the discretion of the court. § 29. Soliciting employment and accepting passes prohibited — pen- alty.] No mayor nor any member of the council of any such city, nor any member of a board or commission created pursuant to the authority con- 18 ferred by Section 2 of this Act, shall request, solicit, accept or receive, directly or indirectly, from any public utility subject to the jurisdiction of such city, any employment, for hire or otherwise, for himself or for any other person, or any frank, free ticket, pass or free service, either for }iim- self or for any other person, or request, solicit, accept or receive, directly or indirectly, from any such public utility, for himself or for any other per- son, any service upon terms more favorable than are granted to the public generally. Any violation of this section shall be a misdemeanor and punished by a fine not less than $100.00 nor more than $500.00, and shall be ground for removal from office. § 30. Repeal.] All acts and parts of acts inconsistent with this Act, so far as inconsistent, shall te inoperative within and in regard to cities now having, or which may hereafter have, a population of 200,000 or more, and shall adopt this Act. Nothing in this Act contained shall be held or construed to repeal or modify in any manner any of the provisions of an act entitled, "An Act to authorize cities to acquire, construct, own and to lease or operate public utilities and to provide the means therefor," ap- proved June 26, 1913. § 31. Constitutionality.] If any section, subdivision, sentence, clause or provision of this Act is for any reason held invalid or to be unconstitu- tional, such decision or holding shall not affect the validity of the remain- ing portions of this Act or of the remafning portions of any section or any rema:ining subdivisions, sentences, clauses or provisions. § 32. Techxical omissions not to invalidate acts or city.] A sub- stantial compliance with the requirements of this Act shall be sufficient to give effect to all the acts, orders, ordinances, contract ordinances, de- cisions, rules and regulations of any such city, and they shall not be declared inoperative, illegal or void for any omission or objection of a technical na- ture in respect thereto. § 33. Act to be submitted to legal voters.] Before the foregoing pro- visions shall be in force and effect in any city now having or which may liereafter have a population of 200,000 or more, this act shall be submitted for adoption to the legal voters of such city. The city council of such city may, by ordinance, direct that the question of the adoption of this act shall be submitted to such legal voters at any general, municipal or special elec- tion in and for the entire city, to be held not less than thirty days from and after the passage of such ordinance. The city clerk of such city shall promptly certify the passage of such ordinance to the board of election •commissioners in case there shall be a board of election commissioners in or for such city, and otherwise to the county court of the coupty in which such city is located, and it shall thereupon be the duty of such board of election commissioners or such county court, as the case may be, to submit the question of the adoption of this Act to such legal voters. The question of the adoption of this Act may also be submitted to such legal voters in the following manner: A petition signed by such legal voters of the oity equal in number to at least five per centum of such legal voters of the city vot- ing at the last preceding election for mayor, praying for the submission of the question of adopting this Act, may be filed with the board of election commissioners of such city or with such county court, as the case may be, and it shall thereupon be the duty of said board of election commissioners, or said county court, to submit the question of the adoption of this Act to such legal voters at the next general, municipal or special election in and for the entire city, to be held not less than forty days from and after the filing of such petition. The said board of election commissioners or said county court, as the case may be, shall give notice of such election by pub- lishing a notice thereof, not less than thirty days prior to such election, in at least one newspaper of general circulation published in such city. The ballot to be used at such election in voting upon this Act shall be substantially in the following form: 19 For the adoption of an Act entitled "An Act to authorize and empower cities now having, or which may hereafter have, a population of 200,000 or more, to provide for the regulation of public utilities," Yes. No. If a majority of such legal voters of such city voting thereon shall vote for the adoption of this Act, it shall thereby and thereupon be adopted by and be in force and effect in said city. If this Act shall fail to be adopted at any time at which it is sub- mitted under the requirements of this section, by a majority of such legal voters of such city voting thereon, then it may be resubmitted, from time to time, if such resubmission shall be directed by an ordinance of the city council of such city or demanded by a petition signed by such legal voters of the city equal in number to at least five per centum of the legal voters of such city voting at the last preceding election for mayor, the procedure for such resubmission to be in all other respects the same as when first submitted. STATEMENT IN FAVOR OF HOME RULE FOR PUBLIC UTILITIES. [By Alderman Charles E. Meeriam.] HOME RULE FOR PUBLIC UTILITIES. EXTENT OF LOCAL INTEREST. The activities of public utilities companies of Chicago are an important part of the municipality's life. The value of the property required for their operations, the number of men employed, the annual earnings and expendit- ures, the total debt incurred, when compared with like figures for the city, show how close a competitor of the city government are the public service corporations. The following figures are illustrative of this: TABLE I. Company. Stock. Bonds. Total capital. Gross earnlngrs. Number of em- ployees. Peoples Gas L-ieht and Coke Co — $38,500,000 $46,762,000 *6. 000. 000 *6. 000. 000 42,631.000 19,233,417 ,38,089,791 54.789.000 6.813,000 38,525,000 96,495,000 $85,262,000 $17,037,894 5,000 97.262,000 88,469,936 49,233.417 87,358,791 91,081.500 16,812,000 69,997,000 96,595,000 Commonwealtla Edison Co. 45,838,936 30.000,000 49.269,000 36.292,500 10,000,000 31,472,000 tl00,000 20,882,327 17,559 533 780,661 8,045,264 843,682 } 31, 690, 762 4,867 14,000 Cliicafiro Utilities Co. (Tunnel, ware- 278 Chicagro Elevated Rys. (Metropoli- tan. Northwest'n & Soutti Side) . Chiraero and Oak Park Line } 5.000 13,000 Chicago Railways Co ... . Total $341,472,436 $855,337,208 $596,809,644 $96,840,123 43,145 * Guaranteed by Peoples Co. t Part certiflcatlons no par value. 80 TABLE I — Concluded. Governmental orKanization. Property. Debt. Income (1915). Number of em- ployees. City of Chicag-o Cook County Sanitary District Lincoln Park Commission South Park Commission West Cbicagro Park Commission. Total $163,746,063 $31,924,000 10.392,500 14,541,000 1,887,000 5.067,000 4,413,000 $70,557,323 8.841,578 6,228.175 +703,320 +3,039,437 2,719,171 31,937 2,900 500 900 1.600 ♦$217,992,382 $68,324,500 $92,089,004 38,820 + 1914. These figures Indicate the importance of the relation between the munic- ipality and the public service corporation. The weight of these companies Is so great, numerically and financially, that they can be met effectively by one power only, and that Is the combined force of the community they serve. The users of gas and electricity, telephone and street railway service are familiar with the work done and the prices paid. They are organized to express their will only in the government of the city and under our law should be given full power to assert it and make It effective. The pressure of those in every day contact with public utilities will be steadier and surer than the pressure of the entire State which contains thousands of people not affected at all and many others only slightly, by public utility service. Practically every family in Chicago uses gas and street cars, but many of the people of Illinois are not interested In these important factors of urban life. Brown's Gas Directory (1916) gives the number of gas con- sumers in Chicago at 655,219, and of all the other gas companies operating in the State, outside of Chicago.at 249,793. The report of the Illinois Public Utility Commission (1914) states that the revenue received from passengers of street cars in Chicago amounted to $31,861,333, and by all the other street car companies in the State, outside of Chicago, $4,986,499, or less than one- sixth of the amount paid by such service by people of the city of Chicago. On a slightly smaller scale, the same principle probably applies to telephone and electric lights, although the downstate figures are not compiled. There are 425,000 telephone subscribers in Chicago and 302,899 users of electricity. CONCENTRATION OP FINANCIAL CONTROL IN CHICAGO'S PUBLIC UTILITIES. The increasing concentration of financial control over the public utili- ties in Chicago makes this factor still more important. In 1897 the various gas companies were merged Into one — The Peoples Gas Light & Coke Com- pany. In 1907 six street railway systems were combined under the two systems, the Chicago City Railroad Company and the Chicago Railways Com- pany. By the unification ordinance of 1913, these two companies were then united for purposes of operation under the name of the Chicago Surface Lines. In 1911 the three (Chicago & Oak Park is in hands of Receiver Samuel Insull and In control of same Interests) systems of elevated lines were combined under the name of Chicago Elevated Railways. In 1907 the Commonwealth Electric and the Chicago Edison Companies were united as the Commonwealth Edison Company. Nor does this' complete the process. In November, 1913, the Common- wealth Edison acquired control of the Peoples Gas Light & Coke Company and the same person was made chairman of the board of directors of both companies. In 1911 the Commonwealth Edison interests acquired the con- trol of the elevated lines. The merger of the elevated and surface, lines has been projected for some time and is now pending before the city. If this is accomplished, all of the utility companies in Chicago, except the Telephone Company, will be com- bined in one large corporation capitalized at perhaps $500,000,000 and em- ploying over 30,000 persons. CHART I. CtlOAOO CTLBgBnE oagAlT. OWIOBM. Bit B« flujuuf« Pr68» AXoato Bart, ▼.?• Troas. Waltar I>. Ulmar, Sao< DIR50T0RS . AloBx« Bart ShBano«7 Eesp ■ Robart !• Llsoola r 3otn 3, liltol>«U Uorrla Boghltt ' Aa A* Sprogiu) V. I. Bothall fliao. 9. Vail B«'B« flttjBiy W. H^ Hlser OCaMOJWEALIH EJISOS OOMPABI. cgri(a!R3. Sconsl Inenll, 7r«BHp| Iionls A» Vsrgneim, T.P.- Jo]m r. aUahilBt.T.F.- Wllllaa A. loz, V,P. Join B. Onllok, V.?, S. J. I)07l«i S«a. Robart I. Llnoola •John J. MltohBll ■ "A. A< Spragaa *B7roB Jt, anlth idsoatLsad) Benr7 A, Blair ■ Benjanla Oarpeater Jtx>»B A. Pattan totta 0« Shadd *Saiiaal IhboU (*) Oonetltnte the Sxeoutlvc OoBBilttee of flvs. Msapi,S8 SAs LisHT & oaa oo. FPIOBRS ■ Soiiaal Inenll, Ohalnran Board of Brs Jasa r> Uaagbar, Fr«s. E, 3, Oovdary, V.P. JohB Willionaon, T.P, L. A. 711o7, Sao. PIRBCTOaS. . Saaael Innai Jas».F. Uaagbar . Jae«. A. Pattan ■John Ji Kltoholl S. 0. Oowdarr Board Chicago Utility Companies DEPARTMENT Of PUBLIC 5EPVICE Ci4y o'f CInieago OHIOAOO ELZTATXO RlII>nT3 iotaotttl Te OOBalttag <-Banr7 A. iiiS - Ir» M. Ooba -Sanial Iniull OHIOAOO & OiZ fiat £I£VAT£D Heoalra r -Suuel Inaull ~ SOUTB SIDE XI.I7ATZ0 RAHROi g OOffiff r Plraot ors' nmel IneoIT -Henry A. Blair -Ira M. Osb* -John V. Qllohrtst -Brltton I, Budd B, 3. Doyle -Cbaa. H. Irelaad BORTHWEST^DB BUTAnO Plraot ors -SaBual laauH -Henry A. Blair -Ira M. Ooba Sanual HoRoberts ' Brltton I. Budd -Vllllaa A. Tax 3. H. Gullok -Chaa, B. Ireland HETROFOI.ITAB «BST SIDE ELE7AT SD RAIUO AP COMPi^ BT orfeotorg -SaBual Inaull -Henry A. Blair -Ira U. Oobe -Brltton I. Budd -V. W. Crawford -Wllllaa A. To* -3. T. Gllchrlat OHIOAOO OUT 4 OOBBEOTIBO RAljLWATa COMPAOT Dlreotor s • B. 1. Bunny -Ira M. Oobe -John J. Mitchell —Samuel Inaull -L. A. Buaby OHIgAOO & IMEmiRBAB TRACTIOH 00 . Slraotora* -Ira U. CoHe " -rHenry A, Blair — SaiTUcl Insoll — t, A. Busby Frank J. BoJcer -W. W, Crawford HAinioap. raiim * easi eHioASo ry co . iJlrootorg* -Ira K. Oobe -t. A. Busby -U, W. Crawford -0. B. Ireland — 0, B. Moore OHIOAOO & ffaSIZRH RAILWAY COKPABT. Directors. -Ira H, OoBe -Ii. A. Busby tW. »• Crawford Co. R. Uoore CALOHB? ft SOOTH CHICASO RAIMAT CO. blHECTORS . -Ira M. Oobe -L, A. Bnsby -ff« -ff. Cravfford -C, H. Ireland — C. B. Moore BOroHSRg STR BS T RAILWAY CO . BICTCTQga . -Ira M. Cobe -L. A. Bosby -JT. w. Crawford -C. E. Ireland I — C. B, Moore MIIlPLa WB3T OTILITIBS CO . ^FiCERS . Sanrael InsalT7 Pros. Martin Insull, V.P. -John F. Ollohrist. V.P. Prank J. Baker, V.P. E, J. Doyle, V.P. BIHECIORS. F. J. Saker E. J. Eoylo -Iionlo A. ForguEon - wmiam A. Fox -John P. Ollohrist - John B. Onliolc Uartln J. InsnU ' Sainxsl Ineull Wm. J. Haloney Ohas. A. Uonroe Prank S, Peabody Bdw. P. Rnsaell UarShall E. Sempsell Prederld: Sargent FBBUO EBRVICB OOUPABX OP BOSIHBHH ILLIH0I3. * — BMiasBg . — ■■ vSaiimol Insull, Pres. - F. J. BaSer, V.P. C. A. Uonroo, V.P. John A. Oullok, V.P. piREOTORS . - P. J. Baier Banry A. Blair John H. Gullok -Loula A. .Fergnaon Vllllaa A. Fox -John F. GllOhrlBt Chaa. k Uonroa . Frank' 6. Logan . saauel Insull John L. Barton Charles B. Randle Edward P. RuBsell Solomon A. Solth A holding oooipony controlling CKHTSAL ILLIBOIS PUBLIC SEOTICB CO. SHI-COOTK LKffll ft SOWffiB 00. CBBTRAL IlLIHOIS BSILISIBS 00. ILLIB0I3.B0RTEEHS OTIIIIIBS CO. ^HEBPOHT HAILWAT ft LIGHT CO. IBSER3TATE PtTBlIC SERVICE CO. CBBTHAL iroiASA LllKTIDO CO. PBAHiaiH WATKE MGHT ft POWBH CO. 80B3HKIM ISnUHA POWER CO. CITIZSBS ICB rVSXi ft MfO. CO. rmviw OAs & eusctbic co. B3» ALBABY WATSB nORKS lOOISVILLE ft BOHIHEHB RAILWAY ft LIOHIISS CO, lOOISVItLB * SO):UBKRII IHDiaiA THACIIOB CO. KEHTBCKY OTILITIES CO. MSSOBBI GAS ft ELECTHIC SERVICE 00. COHSTAHTIHE HXDRAOLIC COMPABY UILLIBO ft POWER COMPABY. XBRXS RIVERS GAS COHPABY THBaS RIVERS LIGHT ft POTCR CO. lURQUSTTE COCBTY GAS ft BLBCTBIC CO. PUBLIC 3SBTICE COKPAHY OF OELAEOUA CEICKASHA GAS ft ELECTRIC COICPABY TBIB STATES OAS ft XLECIRIC CO. IPALHOHTH LIOHTIDO PLABT BBBRASBA CITIBS UTILITIB3 CO.. ILLIBOIB fiOBlSEBB 0TILITIE3 COHPABY . — 0WI C 8B9 ' - Saooai Insult. Pros. E. S. Alexander, V.P. J. E. Gullok, Seo-Trsas. BIRECgORg . , Saouel uSuIX Uartln Ineull £. D. Alexander . John B. Gullok miian A. Pox BORTH SHORE BLBUIRIC CO. CHICAGO 30B0BBAB LIGHT ft POSEB CO. BCOBOUY LIGHT ft POBBR CO. lUIBOIS VALLBY GAS ft ELECTHIC CO. XABEIEEB GAS ft ELECTBIC CO. BORTHWESTERB OAS LIGHT ft CQZSC CO. (Operates Elootrlo Li^t, Power, Oaa, Water and heating ctllltles;- operatea In over 140 different towns). A oonaollSatlon of IS operating eoqpanlos In Borthern Illinois, oontrolled by KIDBIiE WEST OTILITIES COMPABY. (Operates Eledtrlo Light ft Power, Gas and Street Railway Btllltles.) CHART II. CHART OF ORGANIZATION OF THE EIGHTEEN LOCAL GOVERNMENTS IN CHICAGO NO CENTRAL CONTROL NO CENTRAL RESPONSBIUTT VOTERS OF COOK COUNTY SOUTH PARK COMMISSIONERS WEST CHICAGO PARK COMMISSIONERS LINCOLN PARK COMMISSIONERS VOTERS OF EDISON PARK DISTRICT VOTERS OF RIDGE AVE. PARK DISTRICT VOTERS OF NORTH SHORE PARK DISTRICT VOTERS OF OLD PORTAGE PARK DISTRICT VOTERS OF IRVING PAT^K DISTRICT VOTERS OF NORTH WEST PARK. District MUNI CO VOTSBti Of CJTY or CHICAGO JMUNICIPALTUBER- ;UL0S15 S4N!TARIUM jseilep Irisp'n We';qktis(!,Hea S«nokelnsp'ni LSBRAfiV BOARD BOARD OF EDUCATION VOTERS OF SANITARY OlSTWa Of CHICAGO [CON6UI.TINGI ENGINEER VOTERS OF COOK COUNTY (surveyor J SOUTH PARK COMMISSIONERS WEST CHICAGO PARK COMMISSIONERS LINCOLN PARK COMMISSIONERS VOTERS OF EDISON PARK DISTRICT VOTERS OF RIDGE AVE. PARK DISTRICT VOTERS OF NORTH SHORE PARK DISTRICT kemmis&ioncra VOTERS OF OLD PORTAGE PARK DISTRICT VOTERS OF IRVING PARK DISTRICT VOTERS OF NORTH WEST PARK. DISTRICT MUNI CO VOTSB8 OF CJTY CHICAGO MUNICIPALTU6ER- CULOSIS SANITARIUM ICONSULTINCi ENGINEER I jscilcr insp'nj jWeiqhtisJHeaj iSoioKelnspVi: SptcJolPtar-kr j CH-M LIBRARV BOARD BOARD OP EDUCATION Oil 1 ! Hou&e of I SoordofLotrlJ iHar.SiSubJ (nspcctori ICorrkc^ianj I'impfwemg^t&l jcoiwmicftion^ •ureou 9t StellBtiesI VOTERS OF SANITARY DISTRICT OP CHICAGO I CLERK ~| [trEASURErI ELECTHICAU ENttlNEER [citltFeNeiWtER} I ATroRNEYJ POUICE MARSMAU :R6 OF i JMET I oistrictI VOTEF CALUr PARK OISTRICTI IG[inint«stenersi VOTERS OP Rl OGE PARK DISTRICT VOTERS OF FERNWOOD PARK DISTRICT O Ele&tive Off iciois CHICAGO BUREAU of PUBLIC EFFICIENCY 1313 21 In the meantime concentration of control is obtained by means of inter- locking directorates which Insure common understandings at all times and practically solidify the government of all the great local utilities of the city. A report made by the Public Service Department of Chicago, July, 1914, in response to a council order introduced by me on May 8, 1914, analyzed and tabulated these directorates as they stood at that time. (See Chart I.) On the other hand, the governmental organization of the community served by these utilities is increasingly decentralized. The report of the Chicago Bureau of Public Efficiency in 1913, showed the existence of nine- teen local governing bodies. (See Chart II.) Since that time three bodies have been added to this number and no progress has been made toward the centralization of this complex group of local agencies, all having certain relations to public utilities. CITY'S POWER OP REGULATION AT PRESENT. By far the greatest power over public utilities lies in the city corporate. But notwithstanding the fact that additional powers are necessary to meet the new and unforeseen conditions constantly arising, the authority of the city has actually been decreased or impaired in recent years. The Mills case held that the city could not regulate the price of gas" in the absence of specific authorization. The Mueller law (1903) conferred the power to acquire and operate street railways upon the city, but the test of the act in the case of Lohdell v. City of Chicago, 227 111., 218, decided in June, 1907, showed the law to be practically useless for practical purposes, in view of the requirement that street railway certificates issued in payment for property must be reckoned as a part of the city's debt. The Act of 1905 granted additional powers of regulation to the city. "The City of Chicago * * * ig hereby empowered to prescribe by ordinance maximum rates and charges for the supply of gas and electricity for power, heating and lighting, furnished by any individual company or corporation to such city and the inhabitants thereof. Such rates and charges to be just and reasonable and may be fixed for a period not exceed- ing five years and in case the corporate authorities of any such city shall fix unjust and unreasonable rates and charges, the same be reviewed and determined by the Circuit Court of the county in which city is situated." In 1913 an act was passed granting to municipalities power to own and operate all public 'utilities, but in the absence of any financial power to do so, this law remains useless. It could not be employed if the people of the city were unanimous in their, demand for it. The act, in part, is as follows (Session Laws 1913, p. 455.) "An Act entitled, 'An Act to authorize cities to acquire, construct, own, and to lease or operate public utilities and to provide the means therefor.' "Section" 1. Be it enacted ty the People of the State of Illinois, repre- sented in the General Assembly: That any city in this State shall have the power, subject to the provisions of this Act, to acquire, construct, own and operate any public utility, the produce or service of which, or a major portion thereof, is or is to be supplied to the city or its inhabitants, and to contract for, purchase, and sell to private persons or corporations the products or service of such utilities; to lease any public utility owned by the city to any corporation organized under the laws of this State for the pur- pose of operating such public utility, for a period not longer than twenty years; to fix the rates and charges for the services rendered by such public utilities; and to make all needful rules and regulations in relation thereto." The Act of 1913, creating the State Public Utilities Commission, deprived the city of control over its local utilities by striking out article 6 of the j'-Iginal bill containing an option of local control over local utilities. This home rule article was eliminated by the House. Upon public protest It was r ^stored by the Senate. On the last day of the session the House refused i,o concur in the Senate's amendment, whereupon the Senate receded from iti, position I and passed the bill as it came from the House. Vigorous protest was made before the Governor by delegates from Chicago, but the 23 bill was signed. The statement was made (by the Governor) that this law might easily be amended at the next session of the Legislature. Governor Dunne said, June 30, 1913: "Taking into consideration all the facts it Is manifest to me that the people of the State of Illinois desire a public utility commission. It is true the Legislature repudiated the doctrine of home rule and it is re- grettable that it did not accept the provisions of article 6 of the original bill which vrould have enabled the city of Chicago and all other Cities in the State, if they so elect, to govern and control their own utilities. "Home rule can be provided for hereafter if public sentiment crystallizes sufficiently to influence the State Legislature at the next session to amend the act so that provisions of article 6 of the original bill may be restored to it. This can be done without prejudice to the rest of the State. "I sincerely favor the principle of home rule and used my best efforts to induce the Legislature to write it into the statute." Accordingly, an amendatory act was drawn by the city and presented to the Legislature of 1915. It was impossible to secure favorable action, many of the lawmakers contending that the act should be given more thorough trial than had been possible up to that time. On September 29, 1915, the State Utilities Commission issued an order flatly contradicting the provisions of the Chicago Street Railway Ordinance of 1907. The Utilities Commission required the street railway companies to put on "trailers" at certain hours in direct opposition to the 1907 ordinance, which in express terms forbade the use of "trailers." The enforcement of this order was restrained by Judge Taylor on the ground that it con- flicted with the provisions of the State Constitution prohibiting the Legis- lature from granting rights to construct and operate street railways with- out the consent of the locality. POWER OF PUBLIC TO COPE WITH UTILITY COMPANIES DECREASED. In short, the authority of the city has been diminished while the concentration of control within the public utilities has increased at a rapid rate. While the merger process has gone steadily forward among the utility companies, the power of the city, instead of being increased to meet the new conditions, has actually been reduced. As matters now stand, the Public Utility Commission claims the power to regulate the rates and services of all utilities within the State. The city of Chicago also asserts the right to regulate rates and services of local utilities under various grants. 1. By the act of 1905 covering gas, electric light and telephone com- panies. 2. By the contract ordinance of 1907, giving the city the right to regu- late the service of the street railway company. 3. By the contract ordinance of 1907, giving the city the right to regu- late the rates and service of the telephone company*. 4. By the contract ordinance of 19'07, giving the city the right to regu- late the rates and service of the Commonwealth Edison Company. This situation leaves the whole question of control undetermined. In- evitably such a condition operates to the disadvantage of the general public. If the city attempts regulation the utility companies may fall back upon the Public Utility Commission, while if the Public Utility Commission attempts to regulate, the utility company may fall back upon the plea of the city's exclusive power. In the case of the sweeping order issued by the Public Utility Commis- sion regarding traction service, the surface lines did nothing, leaving the city law department to defend the city's right to regula;te. But in the nego- tiations with the city over the rates for electricity in 1913, the Common- wealth Edison representatives scoffed at the city's right to regulate, explained that their appearance before the city authorities was merely an act of courtesy, and threatened to break off negotiations and appeal to the Public Utility Commission whenever the regulation was unfavorable to them. 33 In the regulation of gas rates the same threat of appeal to the State Commis- sion has been made. This seesaw method is demoralizing to public control of any kind and operates directly against effective regulations of public service corporations. In the long run it will not be helpful to the utility companies themselves if they desire stability and fairness in regulation. The public utility promoter may profit by a period of uncertainty and confusion, but the investor who expects only a fair return on his property will not be helped by such a situa- tion. CAN CHICAGO REGULATE ITS LOCAL UTILITIES? A question has been raised regarding the desirability of local regulation and the ability of the city to regulate its local utilities. The first query is whether the local area is adapted to local regulation. The second query is whether the city possesses the equipment necessary to undertake the work of regulation. The utilities which Chicago seeks power to regulate are entirely or pri- marily within the corporate limits of the city, and are therefore appropriate . objects of local regulation. The figures as to revenue are as follows: Chicago Outside Total business, business. Chicago. ' Suface Lines (1915) $31,690,762 100% 0% Elevated Lines (1915) 8,888,946 94% 6% Commonwealth Edison Co. (1915) 20,882,327 100% 0% Peoples Gas Light & Coke Co. (1915) 17,037,804 100% 0% Chicago Telephone Co. (1911) 12,474,022 ' 83.5% 16.5% Note. — Figures are not available for 1915 on account of revenue. In 1915 the number of subscribers in Chicago numbered 83 per cent of all subscribers of Chicago Telephone Co. in Illinois and SI per cent of all subscribers of that company. Chicago Telephone Co. has 10,557 subscribers outside of Illinois not subject to the jurisdiction of the State Public Utility Commission. It is clear that the mass of these utilities is within Chicago territory and practically all within the area of Chicago considered as an industrial com- munity. Whatever may be case of other cities in the State, Chicago's utilities are largely within the urban limits. In fact, the Chicago utilities are much more nearly within the limits of the municipality than the Illinois utilities which the State Commission regulates, notwithstanding the fact that very large sections of them, as in the cases of railways, lie outside the limits of the State. The limits of Chicago and the Peoples Gas Light & Coke Company are much more nearly coincident than the limits of Illinois and the C. M. & St. P. Railroad Company, which latter the State Utilities Commission regulates. The Commonwealth Edison is more nearly a Chicago utility than the C. & N. W. Railroad is an Illinois utility. CHICAGO WELL EQUIPPED TO DEAL WITH PROBLEM. The ability of Chicago to provide the necessary equipment for public utility regulation can not be seriously questioned. The amazing statement of Judge MacPherson (cited by Mr. Halford Erickson') that "It is well known by all informed men that city councils necessarily adopt rates with but little or no investigation as to what rates ought to be fixed," could scarcely be applied to the city of Chicago. Our municipality in the last ten years has had the advice of Arnold, Cooley, DuPont, Parsons and Ridgway in the consideration of the traction problem; of Wallace and Fisher on railway terminals; of the Jackson Brothers and Bemis on tele- phone rates; of Palmer and Bemis on electric lighting rates; of Hagenah, Bemis and Mr. Erickson (cited above) on the regulation of gas rates. No utilities commission has commanded the services of more experienced engineers, accountants and legal counsel than has Chicago during the last ten years. As a result of various agreements made with utility companies, Chi- cago receives from its utilities $3,882,625.80 a year, distributed as follows: lA. A. B. 57,129, Des Moines Water Case, 192 Fed., 193, 34 REVENUE RECEIVED FROM PUBLIC UTILITY COMPANIES BY CITY OF CHICAGO FOR 1915. Company. Total. Peoples Gas Light & Coke Company, (Ordinance of 1890 regarding Chicago Economic Fuel Gas Co., 5 per cent of gross $ 52,855 92 Commonwealth Edison Company (Ordinance of 1907, 3 per cent of gross receipts) 598,752 27 Chicago Telephone Company (Ordinance of 1907, 3 per cent of gross receipts) 461,818 16 Surface Lines Ordinance of 1907, 55 per cent of so-called "net receipts") 2,557,042 13 Illinois Tunnel Company (Freight and Telephone, 3 per cent) 38,448 90 Elevated Roads — car license of $50 per car and compensation paid by Union Loop and Northwestern Elevated 173,708 42 $3,882,625 80 In 1913, Chicago created a Public Service Department for the purpose of supervising the rates and service of public utility companies on resolu- tion introduced by Alderman Merriam May 19, 1913, and ordinance of Mayor Harrison of December 17, 1913. This department consists of five bureaus, namely: Transportation ; Gas; Telephone; Electric Light and Power; Engineering. Prior to this time there had been a Bureau of Gas and a Department of Local Transportation. The appropriation for this new branch of the gov- ernment in 1916 was $99,088.95. In addition to this the Railroad Terminal Commission, with John P. Wallace at its head, has an annual appropriation of $36,000. Its staff con- sists of a chief engineer, who is also chairman of the commission, five assistant engineers, one of whom acts as secretary, stenographers, and other clerical assistants. The Special Gas Litigation Committee has the service of Donald R. Richberg as counsel and Dr. Edward W. Bemis as gas expert. The appro- priation for these committees in 1916 was $90,000. Unfortunately the powers of the Public Service Department were curbed by the act of 1913, just as the department was created. At present its functions are limited to the general supervision of the public utility service, and the enforcement of certain provisions in contract ordinances. The following brief outline of the work undertaken by this department indicates the possibilities of regulation if the city possessed adequate powers. During 1915, the Bureau of Transportation, on the basis of an investigation of street car service in the city, drafted the nonrush hour service standard ordinance, which has been passed by the city council, and also compiled data for use in determination of a rush-hour service standard ordinance. Studies were made of the distribution of passengers entering the loop district by street cars and elevated lines, and plans for a rerouting of cars so as to secure maximum of service were worked out. The trans- portation bureau has also been active in the service of betterments on various street car lines, and in 21 lines material increases in service were secured. The bureau has also made a check of passengers of various street car lines in the city, and as a result of these checks betterments in the service have been made. The gas bureau is charged with the inspection of all new meters placed in service by the gas company, and also 25 per cent of the other meters in service. The bureau also makes tests of meters on complaint of a consumer. During 1915, 146,007 meters were tested as they were placed in service or as part of the work of testing meters already in service, and 711 meter tests were made on complaint of consumers. Of the meters about to be placed in service for the first time 1,900 were rejected as inaccurate, and meters which came up to the standard were substituted. A very large pro- portion of the meters rejected were fast or did not register, and if they had been placed in service considerable loss in higher gas bills would have 35 resulted to consumers. Of the meters tested on complaint 392 were found fast and but 42 slow. A rebate was given to tlie customers by the gas company in the cases of fast meters. The bureau also made adjustment of 2,208 complaints in regard to excessive bills, and secured tor consumers an average saving of $3.31 tor consumer per year. The bureau makes, on request, examfnation of gas fixtures without charge to consumer, and suggests changes which will result in lower gas bills to consumers, as for example change of flat flame burners to mantle lights, the pressure, candlepower and heat value and purity of gas, and where the gas company has not felt it necessary to maintain the proper service has brought suit and secured compliance with service re- quirements. The gas bureau has also been appealed to by citizens for extensions of gas service in outlying sections of the city, and they have been materially aided by the bureau in many cases in securing such extensions. The Telephone Bureau besides checking on the telephone service paid lor by the city given by 1,400 phones also adjusts complaints, of which there were 832 in 1915 from subscribers in regard to excess charges, extension of service and service complaints. Over 90 per cent of the complaints tvere adjusted to the satisfaction of the complainants. The Electric Bureau during 1915 received 1,281 complaints in regard to service, extension, and high bills, and in 93 per cent of cases they were adjusted satisfactorily to the consunier. Refunds of $994.36 were paid to consumers on high bills, and an estimated saving to consumers of $14,38a was secured to consumers through recommendations of the bureau on the use of proper equipment, and through the elimination of deposits requested by the Edison Company. The bureau makes tests of all meters placed in service, and also tests meters in service on complaint of consumer. Con- sumers are informed as to the best use to make of their electrical equipment so as to secure the benefits of the rate schedule of the company. The Bureau of Valuation Statistics has completed studies of the taxicab rates and vehicle traffic in the city, and has compiled population statistics with reference to the need of additional transportation facilities and other public utilities extensions. Statistics as to the operation of various utilities in the city have also been compiled, and value studies made of these utilities have been indexed and made available for use by this bureau. CHICAGO'S APPROPRIATIONS FOR WORK COMPARE FAVORABLY WITH STATE COMMISSIONS. The city of Chicago in 1916 appropriated for the regulation of public utilities in the city as follows: Department of Public Service $ 99,088 95 Railway Terminal Commission 36,500 00 Committee on Gas, Oil and Electric Light 17,000 00 Committee on Gas I^egislation 90,000 00 Subway and Traction Commission 220,000 00 $462,588 95 The expenditures of various State commissioners are: Illinois— 1914 $ 106,350 00 1915-16 (average per year, $205,000) ■. 410,000 00 Wisconsin — 1915-16 ($1,500 for water power law) 177,120 95 New Torlc— First district (1914) total 3,000,000 00 of which $2,500,000 was for rapid transit work, $500,000 for general regulation work. (1,800 employees on rapid transit and 300 on regulation — total, 2,100.) New York— Second district (October 1, 1914, to October 1, 1915) $438,056 79 Massachusetts — (1915) Public service (exp.) 163,703 66 Gas and Electric Com. (app.) 81,675 00 $245,378 66 Chicago's expenditures and equipment compare favorably with that of the Illinois Commission or that of Wisconsin. In fact, it is not surpassed by that of any State with the exception of New York. 36 IMPORTANCE OF CONTROL OF UTILITIES TO PROPER CITY PLANNING. The relation of these utilities to the life and growth of the municipality is very close. They affect the daily comfort and convenience of every citizen, and they are directly connected with the industrial growth of the com- munity. This is especially true of transportation utilities. They are vital to the city, and the local control is indispensable, to the growth and govern- ment of the municipality. To control the transportation lines and service is to control in large measure the development of the city. Industrial and residential development, the relief of congestion, the amelioration of bad housing conditions, the organization and execution of city planning in the modern sense of the term, are all problems which can not be solved without at the same time considering and controlling the transportation facilities of the community. Chicago can not work at a city plan without the power to control its own transportation lines, for a plan which left out these lines would mean very little. A zoning system that was not related to the trans- portation system serving these districts would be very Imperfect in its oper- ation. To make possible the orderly development of a municipality, the closest coordination is necessary between all the numerous elements in the growth of the city. The street plan, the park systems, the building districts, residential and industrial, the terminal facilities, and the transportation routes, must all be included in a well formulated and closely knit plan if Chicago is to reach the requirements of the modern city. To omit trans- portation from these factors would add materially to the difficulties in the way of Chicago city planning. SERVICE TO CONSUMERS PRIMARILY A LOCAL QUESTION. Telephone, gas, and electric rates and service are also closely related to the local situation. Rates for gas to be used for industrial purposes, and rates for electrical power for the same purposes are tied up with the general industrial growth of the city. Whether, and if so, in what way the rates for gas and electricity are to be shaped to commercial power purposes is largely a local matter to be considered as a local question and decided by the local authorities. Whether coal gas with a heat test shall be sold in Chicago instead of water gas with a candlepower requirement, and if so, whether there shall be a sliding scale of prices according to the quantity consumed, is a local ques- tion. Whether electric rates shall be so framed as to encourage use of illumination or for energy is largely a local question, as is the subject of differential rates, and the character of them. The classes of telephone service, and the gradation of rates is also a matter to be considered primarily by the local area of the type of Chicago. Measured or unlimited service, the length of the call, the scale of measured rates, the relative degree of encouragement to residential and commercial service, are primarily home questions. In the same way the extension of facilities and the supervision of service are best looked after by local authorities. The busy signal, the wrong number, the fast meter, the "crowded car" are most quickly felt in the locality, and the attention of their local agents directed to these abuses when they arise. There is no- convincing reason why Chicago's 660,000 gas consumers, its 400,000 telephone subscribers, its 302,889 users of electric light and power, and its 3,000,000 daily users of street cars should find it necessary to appeal to a State board for redress of their grievances. The overwhelming pre- sumption is that the citizens of Chicago have a more accurate knowledge of these conditions than anyone outside the city, and they are capable of apply- ing fair and effective methods of dealing with them. MUNICIPALITY SHOULD CONTROL GRANTING OP LOCAL FRAN- CHISES. It has even been suggested that the power to grant local franchise be taken away from the municipality and conferred upon a state commission. 37 This was a provision of the so-called Model Bill recently prepared by the National Civic Federation. Upon this point Dr. Milo R. Maltbie, a leading public utility expert, says: "Have the public service commissions a monopoly of the honesty, virtue and wisdom in every state? Are state boards so familiar with the needs of every community and so wise in dispensing the proper remedy that they should be substituted for local authorities? Is there virtue to be found in Harrisburg and Albany but not in Philadelphia or New York? The whole idea smacks of bureaucratic centralization of foreign political theories and of the destruction of home rule. Further, many municipalities have had experience with this plan in one form or another. Some of the worst chap- ters in the history of public utilities relate to the granting of rights to use city streets by state authorities. If municipal authorities have been corrupt and if the power to grant or withhold franchises has been abused, the remedy is not state centralization but reform of local conditions, and we have pro- gressed too far in this direction to take a backward step." The perpetual franchise under which the P. G. L. & .C. Company operates was granted by the State Legislature in 1855. The gas merger of 1897 was also a State act. The 50-year franchises of the elevated lines are also State enactments. That the city's record with respect to franchises and rates is stainless can not be contended; there haye been many errors of omission and com- mission. Yet there are two important safeguards at this point. One of these is the adoption of the referendum principle in all traction grants; the other is the ready response of public sentiment upon public utility questions. The reorganization of the city council in 1897 by the M. V. L. centered around the traction question. Again, the elimination of members of the Gas, Oil and Electric Light Committee in 1908 and 1909 is a proof of the public interest in public utility problems. It has been contended, however, that local control is undesirable, because it brings "politics" into tjie domain of public utility questions. This contention is entirely misleading. There is no ground for sup- posing that state governments are less political than municipal governments, taking the country over. Indeed, state governments are always organized on partisan lines, while many cities are nonpartisan in their organization. As a member of the city council of Chicago, which has been organized for more than a decade on a basis of at leaist nominal nonpartisanship, I protest against the assumption that the city hall is any more "political" than a partisan state government has been during the same period. If by "politics" is meant the interference of the demagogue, or the blackmailer, with fair and reasonable settlements, I reply that it is an easy march for these persons from the city hall to the state capitol. They mobilize quickly and understand how to besiege a governor as well as a mayor or a city council. It is utterly idle to suppose that merely by placing the power to regulate in the hands of the state government the influences that interfere with wise and just public control will be automatically eliminated, and that on the whole condi- tions will be one whit improved. The real reason why many corporations prefer state to local control is not that one is more "political" than the other, but that the indirect pressure of the state electorate is preferred to the direct pressure of the local elector- ate. In the confusion of state and national politics they hope to escape, to some extent, public notice and attention. They calculate that in the excite- ment of a national election, in the rivalry between downstate and Chicago, in the battle between the "wets" and the "drys," in the dust raised by fac- tions and sections, that a utilities commission may be secured that either will be controlled or easily influenced by the public utility interests. It is difficult in any state to make the choice of a public utilities commission an effective issue in the selection of a governor, either In the primaries or in the election. The cry that "politics" will interfere with adequate and just municipal regulation is itself a piece of "politics" which is transparently that of the public utility. 28 That there will be general discussions of the relations between public utilities and the city is inevitable, but is just as desirable as it is inevitable. The immense importance of the service performed by these utilities affects the daily life and comfort of every citizen, and it is highly desirable that the broad policies to be followed by the municipality should be fully and gener- ally considered. If the people of the city do not exercise wisdom, justice and judgment in these relations, they must suffer the consequences, just as individuals do. If rates and service requirements fixed by the locality are unfair and unreason- able the courts will overthrow them, and the loser will be the city itself. The real danger is not that of confiscatory rates or arbitrary service orders, against which the corporations are well protected, but that the public will suffer from high prices exacted for inferior service. The real' and present menace is the payment of dividends on watered stock, paid by the crowded car, the busy signal, the wrong number, and the unbridled meter. To compel consumers to deal with our huge utility combination through the devious and indirect agencies of state government will tend to obstruct that vigorous regulation which the ■ public interest requires and which it should be the object of sound legislation to secure. PEOPLE OP CHICAGO WANT HOME RULE. It.hais been contended by some that Chicago does not desire to have home rule over local utilities. Under the public policy act this very question was submitted to the electorate of Chicago, April 7, 1914, in the following form: "Shall the State Legislature amend the act creating a State Public Utili- ties Commission, approved June 30, 1913, so as to provide for home rule and control by the city of Chicago of public utilities within the city." The vote was: Men. Women. Total. For 126,140 56,195 182,335 Against 120,827 51,508 172,335 The bill carrying with it this amendment was approved by the city council and the mayor and by numerous representative persons and organiza- tions. Both candidates for mayor in 1915 were pledged to flght for home rule for Chicago. William Hale Thompson, Republican candidate for mayor, said : "I am a firm believer in the policy of home rule and will use my influence toward having the public utilities in which the citizens of Chicago are exclu- sively interested under the direction and control of the city government and our own people. In that particular I favor the bill of the Charter Commis- sion on Home Rule, and will use my influence to secure its enactment into law.'" Mr. Robert M. Sweitzer, Democratic candidate for mayor, said: "I am for home rule in Chicago." In the election of 1916 both the Republican and the Democratic State platforms declared in favor of home rule for Chicago. Republican platform of 1916 said: "Public Utilities — 'We favor, local control of such utilities for the city of Chicago and favor legislation to that end.' " Democratic platform of 1916: "We pledge our candidate to the support of the following measures * * * a larger measure of home rule for municipalities and particularly to home rule for Chicago, which has so many problems peculiar to that great city." But if any doubt remains as to the real sentiment of Chicago this can readily be resolved by attaching to the bill a referendum clause requiring the approval of the electorate of Chicago before the act shall go into effect. STATE REGULATION NOT ALWAYS EFFECTIVE. That State Utility Commissions are uniformly and necessarily efficient instruments for the protection of the public is no longer generally conceded. 39 On the contrary sharp criticism has been directed against these bodies in recent years. Dr. Wilcox, a well known public utility expert, says: (Annals of Amer- ican Academy, 53:74-75.) "It is fairly certain that the general public has been as unhappily disap- pointed in the general results of state regulation as the companies themselves have been happily disappointed. As in the case of corporations the extent and nature of this disappointment are not uniform either in time of peace. Some commissions, notably that Railroad Commission of California (which, liowever, does not have uniform jurisdiction over local utilities), have borne down upon the corporations with a pretty firm hand and have thereoy main- tained their prestifee with the people, while at the same time they have disarmed the c.pposltion ol the companies by the fairness of their severity. Generally speaking, uoWevor, people are disappointed in the results obtained for money spent, and a gieat many are coming to fear that tho commissions as organs of government are primarily organs of the public utility interests to protect themselves from ibe mosquito-bite of rampant democracy. And at the same time there is a noticeable revival in the movement for municipal ownership and a strengthening of local resistance to the practical abrogation of municipal home rule as it relates to public utilities." And in the National Municipal Review, on "The. Crisis in Public Service Regulation in New "iork," he said: "The chief frailties of human nature are well known. It was easy to foresee and still easier to aftersee the chief weaknesses of the commission movement. It was clear that if a commission should come to be manned by men who were politicians in the usually accepted meaning of that term their efficiency would be destroyed and they would merely get in the way of constructive progress. A politician in public office may be defined as a man who has his mind on something else while he goes through the motion of perfoVming his official duties; and obviously with so different complex and technical a task as that of the public service commissions a politician in such an office would be an unspeakable calamity. Moreover, the experience of the country with city councils, state legislatures, Congress, the railroad commissions, and even the courts had been such as to make it easy to see the imminent danger that these new offices would come to be filled with men who either corruptly or 'honestly' would think the thoughts of the corpora- tions which they were set to regulate, and in effect would assume their own function to be the protection of the corporations, not merely from indiscrim- inating popular wrath, but from the very law itself. * * * It might appear from this recital of perils foreseen or since seen which were inherent for the public service commission movement from the beginning that public service regulation is too dangerous to be tried; that the remedy it oilers is more deadly than the disease it fails to cure." Mr. Stiles P. Jones, secretary of the Voters League of Minneapolis, Minne- sota, says in a severe analysis of the workings of the commissions system: "With the state commission reversing itself on vital phases of the regula- tion act in such rapid sequence, what is the logical end? Can it be anything less than a return to the wholesome principles of home rule, leaving the people of the municipalities to determine for themselves questions that con- cern only themselves; working out their local problems in their own way, free from outside interference; and in the process acquiring self-reliance and capacity for self-government. This is the foundation principle of the Amer- ican system of democratic government, and the only system which will assure permanent conditions of honesty and efficiency in administration and genuine government by the people." Morris L. Cooke, Director of the Utilities Bureau, says, in speaking of appointments to state commissions, in "Snapping Cords": "The work that comes before public service commissions is very largely engineering, and yet there are almost no engineers on the commissions. * * * "A large number of the appointments to these commissions are made for political considerations, and without regard to technical fitness. * * * 30 "It is a safe statement that a governor hardly ever appoints a public service commissioner without at least consulting the leading men in the corporations which that same commissioner is to regulate. Corporations in approving or disapproving candidates use a type of sardonic wisdom which has grown out of their experience." JURISDICTION OF STATE COMMISSION IN ILLINOIS TOO LARGE. The work of the Illinois Public Utility Commission is now so great that some rearrangement is necessary. This body now has jurisdiction over rail- roads, express companies, sleeping car companies, warehouses, interurban lines, gas, water, electric light, telephone and street car utilities. The scope of its work includes not only the rates and service of these companies, but their capitalization as well. The commission must pass on every new stock and bond issue and upon the rates and service rendered by all these widely scattered corporations. The Illinois commission has a jurisdiction over an area larger than any other in the United States, except that of Pennsylvania. The following fig- ures are significant: Capitalization Population. of utilities. Illinois 6, 069, 519 „ , 1 First District 5,468,190 $1,231,541,672 00 New York •) Second District. 4,618,378 ' 750,959.900 00 Massachusetts 3, 662. 339 '^ 352, 601, 458 00 Pennsylvania 8,383,993 Wisconsin 2,473,533 163,308,964 63 ' Does not include catle and telephone companies or American Telephone or Telegraph Companies but includes New York Telephone Company. '' Except steam roads cable and telegraph Companies and A. T. & A. Company. In the year 1914, $176,917,304.92 new stock and bonds were authorized by the commission, and applications for $262,485,258.32 of stock and bonds were pending on December 1, 1914. ' If the commission were to undertake in any detailed way the supervision and !egulation of Chicago utilities its work must of necessity be organized upon some new basis, and at the same time very much larger appropriations must be made. The amount expended for the year 1914 was $106,350. For the biennial period of 1915-16 the sum of $410,000 was appropriated. But it Chicago's problems are to be taken up in detail by this body much larger amounts must be available than hitherto. BILL GIVES CITY FULL REGULATORY POWERS. Tlie proposed bill authorizes the city of Chicago to exercise practically the same power over all local public utilities as are now possessed by the State Commission, with the exception of the power to authorize stock and bond issues. It reinstates article VI of the original bill of 1913. As the incorporation of the company is a State act, the supervision of its stocks and bonds may well be left to the State. The proposed bill provides that these powers shall be exercised through such machinery as may be provided by council ordinance. The council could create a commission or commissioner with power to investigate and decide questions of service and rates, or it could provide that orders of the commission or commissioner should be sub- ject to approval by the council. The method of appointing such an agency would also be determined by ordinance. If deemed desirable the existing Public Service Department might be employed for the purpose of making investigations and reports or any other mechanism could be devised by the municipality, and this would be subject to change from time to time. Service orders and rates, when fixed by the city, would be subject to review by the courts of the State, and might be set aside if found confiscatory or unfair. This wouM put an end to the controversy between the city authorities and the State Public Utilities Commission, and would make it possible for the first time for the city to enter upon a thoroughgoing policy of regulation of the rates and services of all local utility corporations. The shifting of responsibility from one governmental agency to another would be at an end. 31 The city having the full power of regulation, which it has never yet possessed, could adapt and execute a local policy for the first time in its history. APPENDIX A. At the mayor's conference, held in Philadelphia^ November, 1914, and attended by city officials and representatives fi'om all over the United States, the committee on resolutions, composed of Hon. Newton D. Baker, mayor of Cleveland, chairman; Hon. John Purroy Mitchel, mayor of New York; Hon. H. C. Hocken, mayor of Toronto; Hon. T. C. Thompson, mayor of Chatta- nooga; Hon. Frederick W. Donnelly, mayor of Trenton; Hon. John M. Eshle- man, president Railroad Commission of California; Hon. Milo R. Maltbie, New York Public Service Commission, First District; Hon. Edward D. O'Brien, Director of Utilities, Seattle; Hon. Charles B. Merriam, alderman, Chicago; Hon. Theodore P. Thieme, Citizens League of Indiana, Fort "Wayne. "We recommend: "That no general conclusion be formulated upon the abstract question of municipal ownership, but rather we express our judgment to be that munici- palities should be given, in all instances, the power to municipalize public utilities, the expediency of its exercise being at any time aaid place, and with regard to any particular utility, a matter for local determination. "That we make no general determination as between State board and local or home rule regulation of public service corporations; that we do, nowever, declare that the franchise-making power should in all cases be local; that municipally owned utilities should be subject to local control only; that in large cities local regulation is plainly to he preferred; and that in all cases the principles of home rule should be preserved by at least leaving to the people of a city, of whatever size, to determine whether they desire to act for themselves or to call in a State board, if one exists, either to regulate or to aid the local authorities in regulating privately owned local utilities. "That we endorse the idea of the establishment of the Utilities Bureau, as a nation-wide intercity agency for bringing the combined ability and experience of all our cities to the service of each city which may face a public utility problem. Through it we meet the combination of private interests with a combination of public interests, and to the specialized experts which private interests thus mass in defense of one another we oppose the skill, experience and resources of the united cities of the country." BRIEF PRESENTING THE POSITION OF THE CITY OF CHICAGO ON THE QUESTION OF MUNICIPAL REGU- LATION OF PUBLIC UTILITIES, SUBMITTED BY THE MAYOR AND CORPORATION COUNSEL. January 9, 1917. Bon. Medill McOormick, Chairman, and Members of Special Committee on Municipal Regulation of PuMic Utilities, House of Representatives, Forty- ninth General Assembly: Gentlemen: In connection with the investigation and study of your honorable committee as to the advisability of recommending the passage of legislation by the General Assembly granting to the City of Chicago self-government in reference to the control and regulation of its public utilities, we beg to submit, at your request, some considerations which we believe offer convincing proof of the desirability and necessity that control over the utilities operating in Chicago should be taken away from the State Public Utility Commission and vested in the municipality, itself. There exists in Chicago an urgent demand for more and greater powers in reference to this subject. With the tremendous growth in wealth and population^- that has occurred during the last generation, problems have successively arisen in connection with matters relating to public serv- ice which have affected very closely and whose solution have concerned very vitally the interests and welfare of the people of that city. S2 In the days of Charles T. Yerkes' dominatjon of Chicago's traction affairs the principle of governmental regulation of public utilities had not been established and questions of rates and service were left to the mercies of the utilities, themselves. The abuses resulting from this policy — watered stock, franchise grabs, demoralization of service and corruption in the halls of government, all inspiired by the search for dividends and profit at whatever cost, led to a widespread public sentiment for governmental re- gulation and In the case of the City of Chicago this was accompanied by an Insistent demand for additional power of control by the municipality, itself, over public utility corporations. During the last fifteen or twenty years the force of public opinion in Chicago has continually asserted itself in reference to public service prob- lems. It made itself felt when the Legislature was prevailed upon to defeat the Humphrey bills in 1897 and two years later to repeal the Allen law; to pass the Mueller law in 1903 conferring power upon municipalities to "acquire, construct, own, operate and lease street railways, and to provide the means therefor"; to pass the public ownership law in 1913, the law relating to docks and wharves in 1911, and the act authorizing cities to regulate the price of gas and electricity used for heat, light or power in 1905. While the people of Chicago have had to contend, in working out their relations with their public utilities, with serious restrictions upon the power which they have received from the General Assembly, they have handled with uniform success the great problems with which they have been con- fronted. The greatest of these problems was that relating to street railway trans- portation. For many years conditions existed which were a scandal to the people of Chicago and the Sitate of Illinois. The privileges that had been receiived from the people were exploited with a view alone to the dollars that could be made, the service rendered was demoralized and the interests of the public ignored. In 1907 the city council took the opportunity offered by the termination of some of the outstanding franchises to secure a complete readjustment of these conditions and the so-called "settlement ordinances" were passed, which were accepted by the street railways. Under these or- dinances, which constitute contracts between the street railways and the city, millions of dollars were spent by the companies in rehabilitating their systems, through routes were established, the lines of the companies were extended, new equipment was acquired of the most modern type, new trans- fer privileges were given, the city reserved the right to acquire the property of the companies by purchase upon terms set forth in the ordinances and to receive fifty-five per cent (55%) of their net earnings. The city's share of net earnings has, in the period since 1907, amounted to over $18,000,000, and good transportation facilities are now afforded. The City of Chicago now owns and operates its own water system and supplies water at low rates. It has also reduced telephone rates and under a contract ordinance, accepted by the Chicago Telephone Company, possesses the right to readjust rates charged by the company every five years, as well as to prescribe rates at any time by general ordinance if and when the Gen- eral Assembly confers upon the city the power to exercise that right. Gas rates likewise have been reduced and further readjustment of such rates is now in the course of negotiation between the city and the Peoples Gas Light & Coke Company. Rates for electricty used for heat, light or power com- pare favorably with those in other cities of the country. As a result of the experiences of the last decade the people of Chicago are committed in a most decided manner to local self-government in tihe control and regulation of its great public utilities. They feel that they have established their ability to handle successfully the problems of this character that may arise, as they have done in the past, and they believe that their representatives are better able to solve these questions advantageously to the public than a commission having the whole State within its jurisdiction and with no direct responsibility to or Interest in the problems of their com- munity. 33 One of the serious weaknesses in the theory of State public utility regulation is the fact that a commission appointed by the Governor of the State, and responsible only to the people of the State as an entirety, is not responsive to the needs of the local community and as a result the interests of the people in such community must necessarily suffer. Public utilities generally favor State regulation for the very reason that the members of such a commission are far removed from local influences and are not easily impressed by the demands of the local public. Municipal governments to-day, and this is very true of the city of Chicago, represent real democracy. The local authorities reflect in an unusual degree the spirit of the people and are solicitously watchful of the interests of their munici- pal constituency. The citizens of Chicago did not want the passage of a law by the General Assembly creating a State Public Utility Commission to assume control over the utilities in which they are vitally interested and they protested vigorously against the passage of any such law which did not give to the city full jurisdiction over the operation of their local public service corporations. It is signiflcant that at the time when the people of Chicago had demonstrated in an unequivocal manner their desire and capac- ity for effective control over these utilities, the principle of democratic government should be sacrificed by the passage of a law which failed signally to represent the urgent force of this public opinion. A few years ago the theory of State regulation over public utilities was conceived as a result of the very evident need of governmental regulation. That regulation is necessary is no longer an open question. But in the states where regulation by State commission has been tried, the autocratic character of thjs form of regulation has become apparent at the same time that its ineffectiveness has been proven. It has been found that regulation by State commission has tended to weaken the initiative, self reliance and capacity of the local governments and has had a disastrous effect upon local citizenship, for the reason that where responsibility for prevailing conditions in connection with their public services has been taken away from them, the result has been apathy and indifference to the needs of the community. It has been found that even where the personnel of such commissions has been above reproach they have, nevertheless, proved Ineffective, in the matter of securing lower rates or better service from public service corporations. The Minnesota Home Rule League has made an extensive investigation of the results of state regulation in Wisconsin, where it is recognized that the State Public Utility Commission is among the best, and has summarized Its findings as follows: "Wisconsin cities and the public generally asked the Wisconsin com- mission in charge of public utilities for reductions in 39 cases. Substan- tial reductions were granted in but 3 cases, and small or nominal reductions in 8 additional cases. "Public service corporations of Wisconsin asked the commission for in- crease of rates in 52 cases. Substantial increases were granted in 43 cases and small increases in 7 additional cases. In other words, some increase was granted in nearly every case where It was asked. Some were granted when not asked for. "Cities or the public asked for better service in 32 cases. Better service was ordered in 20 cases, in some of these cases conditioned upon increased rates. "Public service companies asked for relief of various kinds in 10 cases. It was granted in 9 cases. "Citizens or cities asked for relief in 10 cases; granted in 5 cases. "To express the result in another way, the public, was successful before the Wisconsin commission to a substantial extent in about 7 per cent of the cases brought by it for rate reduction, and was given even the slightest relief in but 29 per cent of the cases. "Public service corporations were successful to some extent in more than 96 per cent of the cases they brought before the commission for rate increases, and were fully or substantially successful in more than 82 per cent of the cases where rate increases were asked for. 34 "In a term of five years, during wliich the trend of public service charges was so strongly downward, the trend under the Wisconsin commission was uniformly upward.'" Another serious fault with State regulation is that a State commission, having jurisdiction all over the State, is unable to secure satisfactory compli- ance with its orders by the utility affected. It may sit in Chicago for the purpose of conducting an investigation in reference to some phase of a cer- tain public service, but after it has made a finding and entered and order in reference to the situation before it, it must then turn its attention to some other complaint, perhaps in some far distant part of the State, and has no means of knowing whether or not its order is complied with except through the formal method of complaints filed in accordance with the pro- cedure set forth in the Public Utility Law. It the city has local control there is no question but that the authorities in charge, being able to confine their attention to the problems existing in the city alone, would be able to give very real and effective supervision and regulation, and, after a certain schedule of rates is prescribed or certain rules are formulated, bring about strict compliance by the utility. Chicago's problems in relation to its public utilities are greater and much more intricate in character than those arising in other parts of the State. Eighty per cent of the gas used in Illinois is consumed in Chicago. The percentage is almost as large in the case of electricity.. The street rail- ways of Chicago transport 3,000,000 people daily. The Chicago Telephone Company has 458,000 subscribers within the limits of the city. The total capiitalization of utility companies in Illinois, excluding railroads, is about $825,0.00,000, of which approximately $525,000,000 is in Chicago. It is ap- parent that is would require the constant and exclusive attention of one commission at least in order to properly deal with the utilities located in Chicago and regulate them in the interest of their subscribers and con- sumers, who constitute the 2,500,000 population of that city. State Public Utility Commissions, either in this or other states have never treated local problems as scientifically as have the local authorities of the city of Chicago. The highest grade of legal and engineering talent has always been procured to assist in working out and determining the extent to which the City could properly go in protecting the interest of the people. Walter L. Fisher, Bion J. Arnold, John F. Wallace and William Barclay Parsons, are among the men who have contributed much to the success of local regulation in Chicago. An argument that is made against local regulation of public utilities is that the local authorities are likely to prescribe unreasonable regulations of service and unduly low rates. "The answer to this is that during the last decade, although settlements have been effected with the street rail- ways, the Telephone Company, the Gas Company, the Electric Light Com- pany, etc., which have brought improved service and considerably reduced rates to the public, the utilities of Chicago are yet prosperous. In case unjust and unreasonable regulations should be imposed upon public service corporations, they may always rely upon the protection of the courts, and the imposition of requirements that will not be sustained by the courts defeats its own end and jeopardizes the public interest. With /the aid of expert talent which Chicago has always commanded with its public service problems, the danger of hasty and ill-considered treatment of utilities has been avoided, and the results of local participation in the regulation of such enterprises have been shown to be, not confiscation, but effective control. It is the effectiveness of this control which is the real ground of complaint by some public utilities which desire regulation by a body but little responsive to the demands of the community which' is to be served, and the same explanation may be given for the vigorous assertion by the people of Chicago of their desire to be given self-government in these matters. ' Regulation of Public Utilities in Wisconsin. By the Minnesota Home Rule League. 35 The most serious phase of the present situation in Chicago, due to the passage of the Public Utilities Law in 1913, is the conflict which now exists between the local authorities and the State Public Utilities Commission. This is best illustrated by an order entered by the commission on Septem- ber 29, 1915, in reference to the street railways operating in that city. It required the Chicago City Railway Company and the Chicago Railways Company to install and use "trailers" during the rush hour periods; to sub- mit a comprehensive plan for the rerouting of their lines; to provide "turn- back" or "loop-back" service in the territory outside of the loop district; to comply with regulations as to headway between cars and as to the service standard fixed by the commission; to submit to the commission plans of all cars thereafter purchased or remodeled. In addition, the city council was called upon to follow certain sugges- tions of the commission with regard to the use of the streets for traffic. The commission handed down an opinion or finding which, inter alia, con- t.ains the following statements: "The Commission was given full jurisdiction in the Illinois Public Utili- ties Law over all questions involving the service of public utilities. In the exercise of .their power under the law the commission from all the evidence in the case believes that trailers should be operated by respondents and the order will so provide. * * * "It is the opinion of the commission * * * that the city of Chicago and the respondents should cooperate and provide a reasonably clear right of way for the cars in the congested district during the rush hours * * * "The city council is * * * requested to pass ordinances prohibiting or effectively regulating the use of surface tracks in the congested districts by vehicles of every character during the rush hour period, and also to pass ordinances preventing the parking of automobiles and other vehicles in the congested districts during the rush hours upon streets where there is not sufficient width between the curb line and the car tracks for vehicles to pass where automobiles and other vehicles are .parked. * * * "Considering all of the testimony, it is the opinion of the commission that additional through service should be provided by the company. * * * "If, however, the company fails to work out such a routing scheme as the evidence shows should be adopted, and which the commission can ap- prove as being possible and practical, it may become necessary for the com- mission to deal with rerouting plans in detail. "The building of more bridges over and tunnels under the Chicago River on streets entering the loop district will make it possible to move more cars into and out of the loop than are now being run there and thereby furnish a greater number of seats. The attention of the city authorities is called to this situation. * * * * * * * "It would be of great benefit if certain streets now closed, largely be- cause of railroad and other industrial properties were open to traffic. * *• * "It is to the interest of the patrons . of the street railway lines that the city authorities take active steps to remedy these situations. "The city should solve the problem of opening Franklin and LaSalle Streets across the Chicago River, as well as the opening of other streets across railroad properties. * * * "Street cars are greatly delayed in the congested districts during the rush hours by vehicular traffic occupying the street car tracks. The city authorities are called upon to prohibit absolutely or effectively regulate the use of the rails by such traffic during the rush hours. * * * "Attention is called to the fact that north- and south-bound cars through the loop district are greatly delayed, and they in turn delay other cars dur- ing the rush hours, because of the extraordinary congestion upon Jackson Boulevard brought about by the overcrowding of that street with vehicular traffic. Jackson Boulevard does not furnish sufficient outlet through the loop district for north and south and west-side people desiring to traverse the 'loop district.' 36 "The commission suggests that by taking all cars off Washington Street east of the Chicago River and continuing that street as a boulevard through the 'loop district' much of the vehicular traffic on Jackson Boule- vard can be taken off and the congestion there eliminated. "Cars can be diverted from Madison and Randolph Streets to the tunnel under the river at Washington Street while vehicular and pedestrian traffic can use the bridge over the river at that place." The State Public Utilities Commission has thus asserted jurisdiction over every phase of street railway transportation in Chicago. The "settle- ment ordinances" of 1907, however, as has been previously shown, themselves govern very completely the operations of the companies. They state upon what streets the companies shall place their tracks, establish through-routes, define transfer privileges that shall, be given, prescribe the character of equipment to be used and the rate of fare, create the board of supervising engineers to check every expenditure and every contract made by the com- panies and reserve to the city council the right to regulate the service of the companies. The provisions of the 1907 ordinances have been followed in two or- dinances subsequently passed relating to the Calumet and South Chicago Railway Company and the Southern Street Railway Compay, and under an ordinance passed by the city council on November 13, 1913, and accepted by each of the companies, the four street railways now using the streets of Chicago are operated as a single system by a board known as the Chicago Surface Lines. The full import of the order entered by the commission on September 29, 1915, can be recognized only when the situation created by these various ordinances of the city is considered. The commission ignored the interests of the city in the operation of these companies arising from its right of pur- chase and to 55 per cent of their net earnings, guaranteed and protected by the contracts existing between the companies and the city, assumed powers which by the ordinances are vested in the board of supervising engineers, required the companies to put on trailers, provide turnbacks or loopbacks and submit a plan for the comprehensive rerouting of their lines, although the ordinances in question prohibited the use of trailers, ordered the elimi- nation of switchback and to route their lines on certain specified streets. In short, the commission indicated an intention to override and be entirely unguided by the provisions of these contracts. The principle contended for by the commission, if sustained, would threaten the overthrow of the entire structure reared by the efforts of the city as a solution of the many years of chaos and disorder in street railway affairs which previously prevailed. The order of the commission has necessarily resulted in litigation be- tween the State Public Utilities Commission and the city of Chicago, in which the latter is seeking to protect the integrity of its contracts with the street railway companies. In the Circuit Court of Cook County Judge Taylor granted an injunction restraining the commission from enforcing its order upon the ground that at the time the Public Utilities Law was enacted, the city, under powers possessed by virtue of the Constitution and statutes of the State, had entered into valid and binding contracts and that those contracts were impaired by the order of the commission, and that the city having the right, in granting its consent to the street railways to use its streets for the operation of their lines, had the right to impose terms and conditions upon which the street railways should exercise that privilege, which were not subject to change or annulment by the commission. The situation thus existing in street railway matters indicates the difficulties which will arise so long as the State Public Utilities Commission continues without restriction its activities with respect to Chicago's utilities. Negotiations are now pending between the city and the Peoples Gas Light & Coke Company with reference to gas rates. The city in entering upon these conferences is acting under the express authority of the Act of 1905, under which the City of Chicago received from the Legislature power to "fix the rates and charges for the supply of gas and electricity for power, heat- 37 lug and lighting furnished by any individual company or corporation to said City of Chicago and the inhabitants thereof," but, as Indicated by the order of the State Public Utilities Commission entered September 29', 1915, previously referred to, the commission claims full jurisdiction over the rates of aJl public utilities within the State, and it is openly admitted by the company that unless it secures the terms It wants from the city, it will go to the State Public Utilities Commission for relief. The city of Chicago does not concede, as a legal proposition, that the State Public Utilities Law of 1913 operated as a repeal of the authority vest- ed in it by the Act of 1905. It did not purport to repeal that act, and as repeals by implication are not favored in law, there Is a valid basis for the contention that the city still retains the authority which it possessed prior to the passage of the Public Utilities Law. Here, again, is conflict which holds the possibility of future litigation and at the same time places an obstacle in the path of effective regulation by permitting utilities to play one regulating agency against the other. These conditions are typical. The same conflict may, and probably will, arise In the case of the Commonwealth Edison Company, which fur- nishes electric light to the people of the city, and in the case of other public utilities over which the city has been given powers of regulation and con- trol. In the case of the Chicago Telephone Company the city reserved the right, under the ordinance by which the city granted to the company the right to use Its streets and maintain a telephone system, to regulate rates that may be charged by the company by prescribing schedules of such rates from time to time for five-yea(r periods. The validity of provisions of this ordinance in reference to rates have been sustained by the Supreme Court of Illinois, and the city denies the right of the State Public Utilities Commission to nullify the conditions upon which the Chicago Telephone Conipany was permitted to engage in the telephone business within its limits, oy altering the rates which may be prescribed pursuant to the or- dinnnce in question. There is now pending before the Public Utilities Commission an appli- cation made by a resident of Oak Park for the regulation of rates charged the residents of Oak Park for telephone service and In this application the validity of the contract ordinances existing between the City of Chicago and the telephone company is called in question and the Public Utilities Commission is asked to establish rates on a basis different from that which is provided In such contract ordinances. This application has not yet gone to hearing and it is hoped that the Utilities Commission will hold that the contract ordinances are valid and binding. Nevertheless, it seems that, to say the least, it Is Improper that the City of Chicago should be called upon to defend its contract ordinances before the State Utilities Com- mission. Indeed, If the contentions made in this application are ultimately sustained the result will practically be that the City of Chicago can make no binding contract ordinances, since it will be in the power of the Public Utilities Commission, at any time, to disregard them. In this connection, it is also Important to bear in mind that, accord- ing to the statute, the decisions of the State Utilities Board can be reviewed only In the Circuit Court of Sangamon County, and then by appeal to the Supreme Court. Thus, the local courts, which presumably have a better knowledge of local conditions, are deprived of jurisdiction, and the City of Chicago, in order to maintain its rights, is compelled to go to one court alone, and that a court more than one hundred miles away. The case above referred to, which was decided by Judge Taylor in favor of the city, is now pending in the Supreme Court for decision, having been submitted at the last December term of that court. It is hoped that a decision will be rendered in that case favorable to the city. Such decision, however, would not necessarily mean that the city has control of other public utilities within Its limits so long as the present Public Utilities Act is In force, since the rights of the city in reference to street railways are based largely upon a special constitutional provision (section 4 of article XI) which applies to street railroads alone. It reads as follows: 38 "Section 4. No law shall be passed by the General Assembly granting the right to construct and operate a street railroad within any city, town or incorporated village, without requiring the consent of the local authorities having the control of the street or highway proposed to be occupied by such street railroad." Therefore, even if the Supreme Court holds that this constitutional pro- vision places the control of street railways beyond the power of the Legislar ture, the city can not predicate any rights on this particular provision of the Constitution with respect to other public utilities. It is evident that the position in which Chicago is now placed by reason of the passage of the Public Utilities Law of 1913 is altogether intolerable. Apparently the only relief which the city can get with respect to it is from the Legislatur*. There is unquestionably a widespread recognition of the justice of Chi- cago's demand for control over its public utilities. Both the Republican and Democratic parties have answered this demand by incorporating in their State platforms a plank affirming Chicago's right to "home rule" in this field. The people of Chicago desire to see the pledge, thus made, fulfilled by the representatives of these parties in the General Assembly. If this is accom- plished the citizens of Chicago will receive their best guaranty of the proper handling of its great public utility problems that may be seen arising in the future. Wm. Hale Thompson, Mayor of the City of Chicago. Samuel A. Ettelson, Corporation Counsel. Ralph G. Ckandali., GOTTHAED A. DAHLBEEfl, Assistant Corporation Counsel, Of Counsel. 39 MINORITY REPORT. To the Honorable the House of Representatives of the Fiftieth Gen- eral Assembly of the State of Illinois: The special committee of seven, appointed by resolution, of the Forty-ninth General Assembly, to investigate and report on the con- trol, and development of the law designed to regulate public utilities in Illinois, heretofore reported by its majority, to this House, and submitted with such majority report, a certain bill, "redrafted", to meet, as it is maintained, the views of the city council of the city of Chicago, as such views are expressed in a bill, submitted to the Forty-ninth General Assembly, which failed of passage. At the time of submitting its report, the committee reserved to each member the right to note exceptions thereto. I gave notice of my intention to do so, and to file a minority report. I submit this, my such report, and state my objections to the report acquiesced in by the majority of the special committee. I am sincere, when I say I have the very highest regard for the intelligence, and integrity of 'all the members of the committee, who joined in the majority report, and that it would be a pleasure, were I able to do so, to join them in their findings. In the year 1912, I had the pleasure of serving on a joint commit- tee of the Senate and House, charged with the duty of investigating in the different states, where the commission form of regulation was in force, the practical operations of laws designed to regulate public utilities. That joint committee visited several different states and came into intimate contact with members of various state commissions, and also with those interested in the management of public utilities, and with the citizens served by such utihties. Such committee secured data from all the states where laws regu- lating public utilities had been worked out and made a comprehen- sive report to the General Assembly, including in it the opinions of theoretical men, as well as the judgments and experiences, of those who had practical information on the workings of regulatory acts. The entire subject was as new to me as it was interesting. Certain most important, if not fundamental, ideas for the regulation of public utilities impressed themselves so strongly on me that I hesitate now to relinquish them, even though I may stand alone in their advocacy. I contend that there are three absolutely necessary elements to be made part of any proper regulatory laws if such laws are to be 40 just to the citizen, the utihty, and the community interested. I urge them upon you in the order of their importance. First: The Centralized Power to Control; Second: The Indeterminate Permit; Third: The Regulation of Municipally Owned as well as Pri- vately Owned Utilities. The special joint committee I above referred to recommended to the Forty-eighth General Assembly what it deemed to be a very comprehensive bill for the regulation of utilities through a single State commission. The present law incorporated some of the recom- mendations of the joint committee. committee's suggestions on regulation of municipally owned utilities. In view of some of the recommendations found in the majority report here filed I am forced to conclude that if at the time of pas- sage of the original Public Utilities Law in 1913 the Legislature had accepted more of the suggestions of the joint committee it would have made a more satisfactory Act. The Act of 1913 placed no control or restriction over a munic- ipally owned or operated utility, and so far as regulation is concerned, a municipally owned utility may be organized to serve the thickly set- tled, or saturated territory of a community, taking away from the privately owned utility there the cream of its business, and leaving to it the duty of serving sparsely settled and remote localities not reached by and not desired by the municipal concern. This opportunity is an outrageous discrimination, and it is now being exercised by municipalities of this State. The majority report here submitted, on page four (4) maintains that there is a wide- spread feeling among the operators of public utilities throughout the State that it is unsound in principle to permit municipally owned utilities to conduct their operations free from any supervision by the State Public Utilities Commission. The majority "Inclines in some measure to agree with this position, and recommends, by appropriate legislation, that the State Public Utilities Commission be authorized to prescribe the manner in which the accounts of municipally owned public utilities shall be kept." I object to this half-hearted and evasive statement and conclusion. I would not deny to municipalities the right to render public services. Municipalities should, and under' our laws they do, have such right and should exercise it whenever a public utility in the field fails to render adequate service at just and reasonable rates, upon proper terms and conditions, or where no privately owned concern has en- tered the field. When a municipality now goes into the business of furnishing service of this character there is no restriction upon its life or Hcense. It is not required to amortize its investment within any specific num- ber of years. It is required to pay no taxes. It need not provide "adequate return" for money invested nor guard against depreciation ; 41 it even may, and possiblj^ should, be allowed to dperate at what might be called a loss; or, in other words, it possibly should be allowed to operate at the expense of the community served, and if conditions warrant, it should have the right to furnish its service or commodi- ties free to all of its citizens without restriction. There is no good reason why a city, financially able to do it, should not furnish free street car service to its citizens, and gas, electricity, water, or any other service or commodity, taking the cost of the same out of its general fund; and no private utility in business in such city would have a legal right to complain even though in justice and equity its property should be thus destroyed. While all this may be true, and some day may come to pass, still no municipality should have a right to operate a business at a loss and, by juggling its accounts, delude its citizens into the belief that it is "operating" such business at a profit. The recent experience of the municipal electric plant of Cleveland, Ohio, demonstrates that since its inception it has been operated at a loss, while its advocates claimed the contrary. Its loss in 1915 was over $58,000.00 charging only 4J^ per cent return (interest on bonds) for capital invested. No municipality should have a right to do indirectly that which the Constitution of Illinois declares shall not be done, namely; to take or injure private property without giving adequate and just compensation for it to its owner. In Illinois private capital should not be allowed, and presum- ably is not allowed, to compete with private capital in serving com- munities, thereby unnecessarily duplicating service and investment. When private capital is invested in rendering a quasi-public service in a community the law of Illinois allows to the municipality itself the right to destroy the property so invested. It compels the private investor to serve large numbers of the citizens of the community whose demands and uses are limited, while the municipality itself, is allowed to serve compacted and profitable territory, without assuming any of the burdens of developing new areas or taking any business risk. The majority report here falls far short of what, in my opinion^ should have been the findings of the committee on this subject. In- stead of recommending legislation that would prescribe only the man- ner in which the accounts of municipally owned public utilities should be kept it should have recommended that the State Public Utilities Commission be allowed to compel municipally owned utilities to ren- der the kind of service the citizens of the municipality are entitled to receive and to make known to the taxpayers the exact cost of the operations of the municipally owned plant. In view of what I have said, I feel I am justified in asserting that the indeterminate permit for all utilities, municipal, as well as those privately owned, furnishes the proper and logical life for those in the business of supplying these public needs. This permit is simply a license to serve. It is a lease, as it were, to a tenant, conditioned that it must vacate the premises, either for nonpayment of rent, a failure to make repairs, or for a failure to properly protect the property leased to it. 42 A public utility should only be a tenant-at-sufferance in the pub- lic streets and for just cause the State should have a right to ter- minate its life and retake the property leased; yes, and even to collect from such tenant for any abuse or damage done by it to the prop- erty while under such lease or license. That the majority report is inconsistent in its recommendations is very evident. It "inclines" (without suggesting the plan) to the idea that the Utility Act should require municipally owned and oper- ated properties to follow certain forms in the keeping of their ac- counts. (Suggestion No. 1, page 4). By section six (6) (page 14) of the bill it is recommended all utilities shall file reports with the State Public Utilities Com- mission. By section seven (7) (page 15) it is proposed to compel all utilities to make application to the State Utilities Commission for its approval of any issue, sale, purchase, or acquisition of stock, stock certificates, bonds, notes, or other evidence of indebtedness, or for the approval of the capitalization of any merger or consolidation of any public utility with any other utility. By section nine (9) (page 17) it requires every utility in Chicago to file all its rates, schedules, charges, and classifications, as well as all its contracts, with the State Public Utilities Commission — no reason is given for such procedure. By section twenty-three. (23) (page 24) it makes the State Pub- lic Utilities Commission of Illinois, with its corps of engineers, ex- perts, and attorneys, whorn the committee suggest in degree, reach the standard of ability of those who will advise the Chicago city council, do upon request of such city council, all the work necessary to make possible a judgment by the council on the questions of rates or charges, quality, adequacy, and safety of the service or product on such "home ruled" utilities — yes, and the council has the right to require this work to be done in six months by the State Commission. Why should a "home ruled" utility file its reports with the State Commission? I^hy should a "home ruled" utility go to the State Commission with financial plans — its merger or consolidation plans? What reason do they suggest for these recommendations? They seem to desire to give the city council of Chicago the right to "regulate" and "restrict" the operations of the utility, and then leave it to the State Commission to work out the financial problems involved in complying with regula- tions and restrictions. The State Public Utilities Commission of Ill- inois is more than self-sustaining; the fees and charges collected by it from the utilities made a profit for the State, and the majority of the committee realizes that unless the State Commission has the right of approval of stock and bond issues for these "home ruled" utilities that the commission of "home rule" to Chicago would mean a great annual loss in revenue to the State, therefore Chicago is willing to pass the financial element of "regulation" up to the State, not daring to suggest that it be allowed to cut off the revenue of the State in this regard. The ultimate position of the Chicago "home rule" is this : Let our city council "handle" the utilities for the power it brings to the council ; 43 let the State at large and its utilities commission work out, if it can, the great financial problems, we, the council, leave unsettled. ZONES OR DISTRICTS. In the original bill submitted to the General Assembly in 1913 provision was made for dividing the State into five designated zones and for the appointing of one commissioner from each of said zones, and for maintaining at all times an office of the commission, in some city, central in each of said zones. Realizing the great demands that might be made on the commission from the northern part of the State, the bill provided that two of the commissioners might come from Cook County or adjacent thereto. I agree with the majority report here that there is some complaint downstate, because those having business with the commission are re- quired to travel either to Chicago or Springfield to present their causes. The State should be divided into zones and, if necessary, the com- mission should be enlarged so that speedy hearings close to home could be had by the citizens of the different localities. CONTROL OVER ELEVATORS. I agree with the majority report in its recommendation that this General Assembly broaden the power of the State Public Utilities Commission over elevators. I don't believe that the report has gone far enough in its recommendations along this line. There should have been a specific recommendation to broaden the powers of the present State Utilities Commission so that it could control the handling and storing of grain at all elevators, and also that it might have the power to control the storing and handling of coal, ice, and all food products in elevators, warehouses, stockyards, and in transit, as the case might be. It should be empowered to prevent the storing of food with a view *of creating "corners," thus bringing distress to the consuming public and exorbitant profits to speculators and middlemen. DEVELOPED SENTIMENT. I disagree with the conclusion of the majority of this committee that the meetings held developed any sentiment in favor of what is designated as "home rule" for the city of Chicago. Down in the State there is absolutely no such sentiment. Every person appearing before the committee stated that the present law had given satisfaction as a whole, that the theory of it and the appHcation of it was approved, and in most instances, when the "suggestion" was made — "You are not opposed to home rule for Chicago, are you? the reply was — "I am not opposed to home rule for any place ; I believe in the present commis- sion ; I believe in the principle of Commission regulation, and I believe that this law has not had sufficient opportunity to show its many advantages, and I do not approve of any amendments that will restrict the commission's power — I rather favor enlarging it." Such is my understanding of what the expressed sentiment was, and I appeal to the record for support. 44 HOME RULE FOR CHICAGO. Certain gentlemen seem to think, because of the great population of Chicago, and the great volume of public and private business done in Chicago, that therefore the people of Chicago are entitled to some greater consideration than are the people in smaller communities of the State. There seems to be an idea prevalent in some quarters of Chicago that the smaller the group may be the greater the need is for control by the State, and that the larger the group is the less need there is for observing its conduct. One gentleman, a Chicago alderman, told us that there were over 655,000 gas consumers in Chicago and only about 350,000 out in the State. He assumed that because of the great difference in number of gas consumers that some intricate problem came up for solution in Chicago that did not arise elsewhere. It seems to me there shbuld be less trouble in finding out what the fair cost of producing and delivering gas in Chicago is, where prac- tically the same conditions surround every user of it, where every one of these more than 655,000 consumers is served from one source, than it would be for a commission to ascertain what the charges should be for this commodity served to several hundred other coinmunities of the State, where, in every one of the other cities, varying and different conditions exist that affect and are the very essence of the decision necessary to be reached. The same gentleman says that the people of Chicago paid over thirty-one miUions of dollars in 1914 for the privilege of riding on the street cars in Chicago, and that out in the State we paid only about five millions for the privilege of riding on our local street cars. I will not try to account for this great difference in fares by • assuming that the people out in the State go to bed earlier than they do in Chicago or that they have formed the Ford habit in a more, marked degree than have the people of Chicago. I agree that more people ride on the street cars in Chicago than ride on street cars in the balance of the State. I also know that a great many downstate people (as we are generally referred to) contributed their nickels to make up this more than thirty-one million dollars ; that they use these same cars in doing business in Chicago; that they had fought for a hold on the same old strap, and that they have some right to be considered when the transportation facilities of Chicago are up for consideration. I know also that many of them paid two fares to get into Chicago from the nearby cities and villages. I wish Chicago would make up its mind to remain a part of the State of Illinois. I wish it would realize, as the rest of us do, that it is the great, big heart of the. State, from which radiates the great business of the State; that it is the gateway, in all directions, for the products of the State; that it is the great big metropolis of which we are all proud. We like to go to Chicago ; we want to continue going there ; we want to use the "interurban," as well as local trains, in so doing. We want to use the interurban service of the steam lines; we want to use the 45 interurban service of the electric lines, and we hope to see that great bigcity expand and reach out, not only from the "loop" to the city limits, but north, south, and west, through its ability to supply proper transportation facilities for all the people now so deeply in need of it, and to provide for the miUions yet to come. I know, as everybody else knows, that Chicago is handicapped, and always will be handicapped, in the development of its transporta- tion facilities, not because there is a State Public Utilities Commission in Illinois that can regulate Chicago utilities, but because that city, Hke every other city, is bound hand and foot by existing statutes preventing the building of street car lines that shall live longer than twenty years. The question of how to get around "on the cars" after you get to Chicago, and whether you shall, may, or can, use the "Elevated," "The Surface," or "The Subway," or all of those for one or more fares, is purely an engineering and financial proposition. A settlement of this transportation question in Chicago can never be had until after a complete, thorough, and expert investigation of the physical and financial problems involved. Nobody objects to Chi- cago hiring the best experts of the world to work out a solution of its great problem. We do contend that when the evidence is all sub- mitted it should go to a disinterested tribunal that would pass judic- iously, as well as judicially, upon the questions involved and make determinations in fine with justice to all concerned, and that such a tribunal can not be made up of members of the city council or a coun- cil-aj>pointed commission. No community should be obliged to submit its "issues" to a partial and biased jury. No man should be a judge of his own cause and, much more, should it be true that no man should be at once the witness in his own case, sit in judgment of his own and his opponent's evidence, and be empowered, as sheriff, to execute the judgment he might render. That which is the fact, with reference to the number of persons using the street cars in Chicago, when compared to the rest of the State, is true, when we consider the numbers of users of electricity, gas, telephones, railroads, and the like. Certainly there are more persons using telephones in Chicago than there are in the balance of the State, and the great "long distance" trunk lines from Chicago exchanges lead into every village of the State. Every farmer in the State of Illinois, on his party line, is paying a fixed charge each year to the maintenance of this long dis- tance service facility. Every business man is doing the same, and yet the city of Chicago, on the theory that it is entitled to "home rule," wants the power to regulate the local rates within the city of Chicago for telephone service, when every school boy knows that the lessening of these local charges for Chicago users necessarily increases the bur- den on every telephone user in the State of Illinois outside of Chicago. Chicago wants "home rule" on telephone rates and would deny the same privilege to the rest of the State. Reference made by the same alderman to the use of electricity in Chicago reminds one that Chicago is engaged in the generation of 46 electricity nearly 40 miles from the "Loop," and desires to continue generating and distributing the same without regulation by anybody or any commissions on earth except the Sanitary District of Chicago. Wouldn't it be a good plan if some board could divert part of that electricity from the Sanitary District of Chicago generating plant, near Joliet, down the Illinois Valley and compel it to sell the same at rates that would be advantageous to the people of the valley? The alderman appearing before the committee, at the hearing in Chicago, and to whom I refer, asserted there that the surface lines of Chicago did business of 100 per cent in the city of Chicago. I assume that he stated a fact, because the city of Chicago refuses to allow the surface lines of that city to do business outside of the hmits of Chicago, and has cut off from the adjacent towns the right to come into Chicago for one fare. Necessarily every ticket used in Chicago is a "Chicago ticket." Every nickel is a "Chicago nickel." Necessarily the business is 100 per cent Chicago business. "volume of business done." Under the heading of "Volume of Business Done," the majority report asserts that "Chicago utilities" are within the limits of that municipality to a greater extent than other utilities under the control of the State Commission are within the limits of the State. Just how this is made manifest I can't conceive. It may be so, if we will assume that. Chicago is not in the State of Illinois, or that the Illinois State Commission has now no control over Chicago utilities. They assert that the Chicago Telephone Company hasjnore than ten thousand subscribers outside of the State of Illinois who are not subject to the jurisdiction of the State Public Utilities Commission. I can't see the point in this statement. It doesn't make any difference how many subscribers of the Chicago Telephone Com- pany are outside of Illinois ; the State PubHc Utilities Commission is in Illinois and the Chicago Telephone Company is in Illinois, and the State Public Utilities Commission controls the Chicago Telephone Company and its business, and fixes the value of its property, used and useful, in the State of Illinois, and considers this number of sub- scribers living outside of the State as distinct from the main body of subscribers of the company, and apportions to such outside business its part of all the expenses of the Chicago Telephone Company. It is begging the question to make any claim that the State Public Utilities Commission can not protect the people of the State of Illinois or the citizens of Chicago against unreasonable exactions of the Chicago Tele- phone Company, because that concern may have some subscribers in Wisconsin, Iowa, or Indiana. Let me ask right here, do those advo- cating- "home rule" for Chicago contend that the telephone situation of Chicago would be bettered if instead of only the State Public Utili- ties Commission regulating such business the city council of the city of Chicago or a Chicago commission had certain concurrent, or sepa- rate, rights and jurisdictions over the same company, its rates, and service ? 47 CONCENTRATED PUBLIC OPINION. The majority report seems to urge that through "concentrated public opinion" Chicago has great possibilities. It is suggested that the press and the public men of Chicago can, when they care to do so, make the people of Chicago come to the conclusion that certain things are injuring them and that certain specific remedies will cure them. They urge that public sentiment can be turned along certain lines, and be more potent than the influence of the opinions of the people of the State at large. I am surprised that the majority report gives father to any such thought. Should "public sentiment" regulate the rates of utilities ? Should "concentrated public opinion" determine returns for invested capital? Is it claimed "public opinion" as to the rights of the public or the utility could sway a commission, even of Chicago citizens, to form judicial determinations in harmony therewith, even under "home rule" condi- tions ? I trust not. This is the time of year when, annually, we hear a great deal about "public opinion" — "concentrated public opinion," the "potent" influence of the people, the power of the press ; this is the time when the primary election selects the candidate who can demonstrate miore plausibly than the others how to "get something for nothing." On him "public opinion" usually concentrates. CONFLICTING CLAIMS AS TO JURISDICTION. The majority report seems to urge that because there are certain contractual relations, created by ordinances of Chicago with certain utilities there, that the State Public Utilities Commission has no power to enforce its orders if such orders seem to conflict with these ordi- nance restrictions. They tell us that Judge Taylor, of the Circuit Court of Cook County, has denied jurisdiction to be in the State Public Utilities Commission over such referred to utiHties. I am not going to file a dissenting opinion in the case recently before Judge Taylor, but I do assert that the decisions of other judges and the upper courts in other states, where these laws have stood the acid test, are exactly contrary to the alleged holdings of Judge Taylor. The entire theory of regulation of utilities. State and Federal, is based upon the right of the public, through regulating commissions, to interfere with and upset license agreements, where municipalities have made collusive or improvident contracts with public utilities to the detriment of the citizens affected. I have no quarrel with Judge Taylor and his construction of the law, but for the life of me I can not see how, in view of his deci- sion, the conditions confronting us are going to be benefited by letting the Chicago city council, through itself or a commission appointed by it, determine these matters which have been litigated for years, before Judge Taylor or his colleagues, without determination or settlement. I am rather of the opinion that one commission. Statewide in its power, with all of its decisions reviewable in one court, in one county, with the right of appeal therefrom directly to the Supreme Court, is a more 48 expeditious and businesslike way of determining the questions that come up between utilities and communities. "schemes for home rule in CHICAGO." Under this head it is suggested that Chicago demands, and has at her command, the services of better and more experienced engi- neers, accountants, and lawyers than any utility commission in the United States, and has had silich service during the past ten years. If this were true I would be in favor of abolishing the State Public Utilities Commission of Illinois and surrendering all the matters over which it has jurisdiction to the city council of Chicago for adjustment. There is certainly no need of this great commission in Illinois if Chicago is as admirably equipped for these responsibilities as this majority report suggests. It might not be a bad plan to refer the entire subject of regulating the utilities of Illinois to the city council of Chicago, since we have a right to assume that its great organization of "engineers, accountants, and lawyers" must have been brought together and selected by the Strong and uncorruptible men of the city council, whose personnel, so the majority report avers, gives great assurance that all questions affecting the control of utilities will, at their hands, receive fair con- sideration. This would be a reasonable scheme, since they could undoubtedly find time, after regulating Chicago utilities, to do the little work averred to be involved in regulating the few outstate utili- ties which render such little service and serve so few citizens. The majority report suggests that the Chicago city council has no great confidence in its own ability to finally adjust the matters over which it is recommended it be given control. Either this is true or the council is too modest to assume responsibility in adjusting these great matters of public concern. This modesty, or temerity, on the part of the Chicago city council, they say, is evidenced by the fact that it has created boards of supervising engineers, the Railway Terminals Com- mission, and the Department of Public Service, and that it will, "if the public good requires" and it is given "home rule,'' appoint fair- minded commissions, boards, or departments, and attract men of greater strength and intelligence to its own body. My idea is that, in attracting men of strength and intelligence, there is no need that they should be fair-minded, because, in the major- ity report, they need not be inspired by justice and a desire to treat fairly the issues coming before them, but they only need be acute of hearing, and firm, when they once have heard the voice, to bring about such legislation and conditions as "concentrated public opinion" de- mands. During all my legislative life I have been friendly to the city of Chicago and the interests of that city. I have always favored legisla- tion for the benefit of Chicago, its parks, and its various boards, and in the last session, as chairman of the Committee on Municipalities, secured, with others, for Chicago a right to consolidate her park sys- tem. This tendered power of lodal control was rejected by the people at the polls, as herein shown. 49 Bill accompanying majority REPORf. As stated by the majority report, the bill submitted by it is simply a redraft of some measure prepared in Chicago in 1915. The majority report says the city council at that time approved such bill. If the bill drafted a year and a half ago was then good enough for Chicago and carried the endorsement of its city council, press, and public men it ought to be good enough at the present time. Such I assume to be the reasoning of the majority of this committee. About twenty days ago the committee reported, and submitted with its report, and recorn- mended here, the adoption of this certain bill. One would think the council of the city of Chicago and its leading "home rulers" could agree for at least twenty days upon what Chicago desired. The bill is before us, and a reading of paragraph 2 of section 1 readily shows that it seeks to give cities of this State having a population of over 300,000 the right to regulate privately owned utilities operating "wholly, or mainly, or primarily therein." In other words, Chicago, by council or council selected committees or commissions, is to have the right of regulating utilities (private) operating "wholly, or mainly, ar primarily therein," insofar as such utilities and their services and facihties affect Chicago and its citizens within its limits. After reading the bill I was uncertain just what was meant by utilities operating "wholly, or mainly, or primarily therein." I naturally assumed that the bill was aimed at the regulation of all the utilities of Chicago. This language would embrace, undoubtedly, the Commonwealth-Edison Company and the Peoples Gas Light & Coke Co., which, as Alderman Merriam told us, did 100 per cent of their business in the city of Chicago. These companies are undoubt- edly "wholly, or mainly, or primarily within" the city of Chicago. Such a designation would also include the surface transportation (street car) lines. While they are not "wholly" within the city of Chicago, they are "mainly" or "primarily" therein. The same would be true with reference to all the local and interurban service of the various steam railroads and electric roads serving Chicago. This would cover the elevated lines, all of which run miles beyond the city of Chicago and serve communities .adjacent to Chicago. It would include the Chicago Telephone Company, on the theory that it was "mainly" and "primarily" within the city of Chicago. It would include all elevators, cold storage houses, and stockyards in the city of Chicago. It would include the telegraph companies ; in fact, I can't imagine a utility doing business in Chicago that would not be under the control of the Chicago city council. Chicago elevators and cold storage houses, in which are "husbanded" the products of the farms of Illinois and the entire West, these great institutions that, in effect, hold the balance of power between producer and consumer, and which "regu- late" the prices to be paid to the producer by the consumer, after affording unlimited opportunity to the middleman, would be under Chicago council control. I could see, so I thought, that all these "issues" were to be taken away from the representatives of the Peo- ple of the State of Illinois and placed in the hands of the city council so of Chicago, or a committee appointed by it. The bill seems to me to be most comprehensive in its scope. Developments show that I was mistaken. An honorable member of this House, a member who sighed the majority report here, recently introduced here House Bill No. 210, and the same bill was likewise recently introduced in the Senate by Senator Ettleson, corporation counsel of Chicago, and is designated Senate Bill No. 139. These bills are identical with this committee bill in almost every particular, except that in every instance, where in the original, or committee bill, appear the words "wholly, or mainly, or primarily" we find that they are left out, and in their stead appear the words "operating within such city." The issue is now made clear. It is evident that the city authorities of the city of Chicago feared that the bill as submitted by the majority of our committee might not be broad enough and that some guilty utility might escape, so they have sought to make certain that no such contingency will ever arise, and have rejected the words "operating wholly, or mainly, or primarily therein" and reached out to regulate all utilities "operating within such city." One would assume that in these last referred to measures the "home rule" idea in Chicago had, at least to some extent, been definitely expressed; but no, quite recently, the same Senator-corporation counsel of Chicago introduced in the Senate, Bill No. 138, and an honorable member from Chicago, an assistant corporation counsel of that city, introduced the same measure in this House, as House Bill No. 209. These last two measures not only provide for "home rule in cities of 200,000 and more, Chicago only, but they seek to grant "home rule" to cities having a population of 500,000 or more, Chicago only, and give such cities (Chicago) the right to regulate the transportation facilities within their own (Chicago) limits, and within a district thirty miles beyond such limits. In other words, they are bills to establish "home rule" in Chicago, for certain purposes, and for thirty miles beyond. In passing, I may say that of the two theories of "home rule" presented, I rather favor the last, because it is an admission that "local home rule" is a fallacy, a thing that can not be worked out, and that Statewide commission regulation is the only sensible and logical way of regulating public utilities. A pecuHar feature in all these bills is that their sponsors very gen- erously provided that they shall not become operative unless approved by a majority of the legal voters of Chicago voting thereon. Why not require them to receive the affirmative votes of a majority of the legal voters of the State, or at least a majority of the legal voters of the city of Chicago and those residing within the adjacent 30-mile circle. Why only the majority vote of the legal voters of such city voting thereon instead of the majority of the votes cast at the election? Is this great, big, long-suffering municipality so fearful that it will be unable to arouse enough popular interest in a law aimed to adjust its most vital interests that it deems it advisable to so arrange its referen- dum vote on the proposition that a minority of the voters of Chicago shall be allowed to determine such vital question? Does "home rule" mean minority rule? 51 I object to a provision — in any Act — that allows its adoption by the votes of a "majority of the voters voting thereon." THE CHICAGO TRACTION QUESTION. Chicago should be allowed to own its traction facilities whenever its financial ability to do so is present. We are told that in Chicago there are about one thousand miles of single (surface) street car tracks carrying nearly two million fares a day ; that there are, there, elevated lines with over 150 miles of single track carrying over half a million people a day. Eight or ten steam railroads daily serve over 100,000 passengers from Chicago and adjacent territory. Suburban electric lines carry large numbers each day to the loop district, approximately half as many as the steam roads. Those who know tell us that it will require one hundred million dollars to make a start at unifying the transportation facilities of Chicago, and this amount represents only about one-third of what will be required to meet Chicago demands. The work must cover a long period of time, Chicago must grow to the north, south, and west. The loop and lake front are now congested. People must "move out" to get homes and factory sites. Rapid, and certain, transportation facilities must be anticipated. Chi- cago must build for the future. The citizen who builds his home contemplates the enjoyment of it for himself, and his family, for years to come. A man would refuse to invest in property if its life would neces- sarily be so short as to leave to him no prospect of its use for any time except the immediate future. The same business judgment that operates when private interests are being considered should, and must, be exercised by a community in dealing with public affairs, and unless Chicago as a city will keep pace with the efforts and needs of its citizens, it will go on for the next fifty years, as it has in the past thirty years, criticizing, talking, editing, suspecting, protesting, and complaining, the victim of illy conceived and foolishly cherished notions and ideas, harping, carping, and wailing, while attributing all her civic ills to a lack of legislation giving its city council "home rule" powers. As a member of this special committee I am dissenting from the conclusions, and recommendations, of the majority in respect to regulation and control of public utilities operating in Chicago for the further following reasons : (1) The conclusions and recbmmendations of the majority report do not agree with the facts presented to the special committee. (2) Regulation of public utilities throughout the State and includ- ing Chicago, under the present law, is centralized, efficient, and entirely satisfactory to the people at large. (3) The bill recommended by the majority report provides for divided responsibility and inefficiency, with the important business of utility regulation always mixed up with petty aldermanic politics, or worse, in Chicago. 52 (4) The "home rule" arguments of the majority report in support of the bill it recommends do not agree with Chicago evidence sub- mitted. I take this position on the facts brought out and opinions expressed at the hearings conducted by the special committee, and from a consid- eration of the many things of common notoriety admitted by all. In considering the "home rule for Chicago" plea we have a right to look into what Chicago has done with the "home rule powers" it already has, and to consider what Chicago would do with additional home rule powers. On this I have taken the only evidence available, namely, that submitted by the Chicago papers. WHY TINKER WITH A GOOD LAW? The enactment of our Public Utilities Law in 1913 was preceded, as I have said, by exhaustive inquiry and report on the entire subject matter by a special joint committee of the General Assembly. The law as it stands to-day reflects to a large degree the results of that inquiry. Equally thorough examination of the law's defects, if any be alleged, should precede radical changes in it, but no such examination has been made by this committee. (The views of Former Justice Hughes on the vice of legislating without investigating, apropos of the Adamson law, etc., are respectfully recommended to the signers of the majority report.) It is merely pretense to imply — as the majority report implies — that the conclusions and recommendations of the majority, particularly in respect to releasing Chicago utilities from State regulation and control,' are the result of thorough inquiry and investigation by this special committee. Expressions of opinion from "more than 50 persons" (see page 3, majority report) would hardly be conclusive as to the state of public opinion among the 6,000,000 people of Illinois, even if those "more than 50 persons" were unanimous in their opinions. But they were not unanimous on releasing Chicago utilities from State control. The plain facts of the inquiry conducted by the special committee, such as it was (and these ■ statements can be verified by reference to the stenographic reports of the committee's proceedings), are as follows: FACTS OF THE COMMITTEE HEARINGS. The special committee conducted hearings on the Public Utilities law at six places in Illinois (East St. Louis, Danville, Ottawa, Rock Island, Peoria, and Chicago), which hearings occupied parts of eight days. The "more than 50 persons" who appeared before the committee were exactly 53. Outside of Chicago, opinions expressed were practically unani- mous in favor of keeping the Public Utilities law as it is — in favor of regulation and control of public utilities by a State board instead of by the local authorities, or "home rule." The .great majority of those expressing themselves, instead of being "indifferent on the subject" (see majority report, page 6), were emphatically opposed to releasing 53 Chicago and public utilities operating in Chicago from the State Public Utilities law. This particular opinion was forcibly expressed by more than one : "If Chicago wants to make its own laws, it must have less to say about the laws that govern the rest o£ the State; it must accept a reduction of its representation in the General Assembly and permanent limitation of that representation." At the hearings in Chicago nine persons appeared, namely, the mayor, three aldermen, and an ex-assistant corporation counsel of Chicago, an alderman of Evanston, three representatives of public utility companies. A majority of the nine were for Chicago "home rule" in regulation and control of public utilities, but were not agreed on the kind of "home rule" they wanted. THE PRESENT LAW HAS MADE GOOD. The majority report and the stenographic reports of committee hearing contain no evidence that the present law and the machinery for enforcing it have failed, or even hesitated, in proper regulation of Chicago utilities; no evidence that regulation and control of those companies would be, or could be, made more effective by releasing them from State authority. The majority report, in respect to regulation of Chicago utilities, therefore is not a digest of facts and opinions gathered by the special committee, but is only a statement of the opinions of the men who signed it. That is hardly sufficient warrant for gutting the Public Utilities Law, a most excellent and most important statute which has been on the books only about three and one-half years and has most emphatically made good. WHY THE STATE SHOULD REGULATE UTILITIES. We need centralized power of Statewide authority for public utility regulation (as we need a State Supreme Court for decisions) to ascertain the correct principles of utility regulation and establish uniformity in applying them. This is quasi-judicial, or at least admin- istrative, work. It can be properly done only by men selected for special fitness who have nothing else on their minds, who can give all their time to it, and who are far removed from the distractions of politics. Without posing as an expert on the subject, I repeat, without fear of successful contradiction, that scientific regulation now favors the "indeterminate permit" for public utility franchises, instead of the short-term Hcense or franchise, under which the property and service always retrograde. The "indeterminate permit" means that a public utility can go along with its business during good behavior without fear of being ousted except on due notice that fhe city will take over its property, or designate another grantee to take it over and pay for it. This permits, and suggests, a utility to keep up its property and service without fear of great loss. It doesn't take a giant intellect to see the advantage of that to the public. I am in favor of compelling the 54 surrender by all public utilities of their unexpired licenses and giving then in place of the same an "indeterminate permit." The experts say that under the short-term franchise plan the dura- tion of the franchise monopolizes discussion, while rates and quality of service are neglected. Consider your own experiences and you will see that this is what always happens when local authorities "take up" utility questions. THE COMMITTEE BILL A MAKESHIFT. This "home rule" bill, recommended by the majority report, tries to write a theory into law, regardless of the facts. It no more fits the facts of the situation than a pair of overalls makes a suit of clothes. Nothing but confusion, chaos, and inefficiency could result from it. The only sound conclusion reached by the majority report is that the regulation of Chicago utilities, plus utilities in the rest of the State, throws too much work on one State hoard of five members. This can be taken care of in several ways, namely : (1) By making the State board larger. (2) By creating a local board, primarily for investigating, taking testimony, and recommending plans, which would be subordinate to the State board. ( 3 ) By dividing the State into utility regulation zones, one district to include Cook County and the adjacent counties of Lake, DuPage, Kane, Will, and Kankakee, in all of which most Chicago utilities and especially transportation companies have considerable business, thus eliminating much of the divided responsibility and confusion provided for in quantity by the bill recommended. A BILL FOR CONFUSION AND CHAOS. Section 20 of the committee bill exempts from Chicago regulation and control that part of the transportation and telephone utility lines extending beyond the city limits. That is absurd. Take for example the elevated roads running from Chicago's center to Evanston and to Oak Park. It is the same service all the way. Sorne of the passengers travel wholly inside Chicago, some wholly outside, and some both in Chicago and outside. Those living outside Chicago would want as few stops as possible ; those inside would want all of the fast trains to stop for them. Who would regulate the service under the proposed bill? The Chicago city council? Take finances. The bill proposes, I above pointed out, to leave control of stock and bond issues of all utilities to the State board, while operation, service, and rates, which are the selling prices of the service, are to be regulated by the Chicago city council. How long would a plow factory live with one set of men controlling bond and stock issues, providing the money, and another set, wholly independent of and unrelated to the first, regulating production, prices, sales, and policies ? STEAM ROADS AND OTHER UTILITIES. And what about steam road passenger transportation? On the Northwestern, the Illinois Central, and the Rock Island (and perhaps 55 others) a large part of the suburban business is all inside of Chicago. Who is to regulate and control that business as a part of the larger operations of those roads? The suburban passenger service cuts a big figure from another angle. In every report on Chicago transportation made by experts, from Bion J. Arnold down, it has been argued that effective plans for bettering Chicago transportation must include steam roads and co- ordination of their suburban service with the surface and elevated service. Who is to do it under the proposed bill? The Chicago city council ? Freight transportation, too — Will the Chicago council regulate that for Chicago alone? Much, if not most, of the business of some "belt" railroads — The Chicago & Western Indiana, The Chicago Junction, The Baltimore & Ohio Terminal, The lUniois Northern, and others — is entirely "within" Chicago. And the grain elevators whose business is "mainly or primarily within" Chicago ? And the cold storage warehouses ? And the Union Stock Yards which are "wholly" within Chicago and do a public utility business in yarding and feeding live stock? And the malsters who do a warehousing business for the brewers? Will the Chicago council regulate all of these utilities ? "home rule" that spells "petty politics.''' No public, or, private question, is ever settled right, or settled at all, when the details are tangled up with politics. That is why we have an Interstate Commerce Commission and a Federal Trade Commission and a Federal Tariff Commission; that is why regulation of public utilities by State boards is the acce'pted plan — all measures creating these boards have in view nonpolitical regulation. The purpose of public utility regulation, and the result, when regulation is honestly and efficiently applied, is to secure these things : (1) Adequate service to the public at fair rates. (2) Protection of the capital invested in the business. (3) Permanent upkeep of the property and extension of service as necessary. Imagine, if you can, these results coming from utility regulation by the Chicago city council, a body of 70, half of whom are always within one year or less of an election. Imagine it, with each of the 70 trying to get a little the best of it in public service (or maybe jobs) for their constituency. Chicago does not keep its schools out of politics, if the papers there are to be believed. How, then, can it keep public utilities out of politics ? Chicago aldermen have to be in politics to be elected and reelected. Every act and vote of theirs is in politics. Their council jobs are only incidental to other occupations. They do not, and can not be expected to, give their time and energy to the studious and constructive work required in public utility regulation. 56 THE CHICAGO TRIBUNE ON COUNCIL CONTROL. This proposed committee bill would put control of Chicago utilities under the city council "because Chicago is preeminently a council-governed city," and because the city council "in the past has shown capacity to deal with public utility problems." (See printed report, page 9.) The Chicago Tribune (of which Mr. McCormick, chairman of the committee, formerly was editor, and which his family owns) de- nounced this feature of the bill on January 35, 1917, saying: "This feature is weak, in our opinion. Aside from the fact that our mayors have averaged higher than the council, there is the additional con- sideration that when the executive acts he assumes responsibility. Put the appointment in the council and responsibility evaporates. Too many share it. This is a truism proved by our experience of legislative responsibility. The problem of utility regulation is not legislative but administrative and both power and responsibility should be centered in the executive." The same Chicago Tribune discussed the Chicago city council's "capacity to deal with public utility problems" on December 9, 1916, as follows : "our FUTILE CITY COUNCIL." (tRIBUNE). "It is the achievement of the city council to have reached the last depth of futility. * * * "So far from having time to attend to the business of other bodies, the city council has been unable to conduct its own affairs, as is shown by its failure to solve the lake shore problem, the transportation problem, and bathing beach problem, to obtain an adequate water supply, to manage the finances of the city, or do anything whatever to check the crime wave which is engulfing the community. "While it neglects its legal functions, it wastes its own time and the time of the public, harassing another municipal organization much better managed than itself. "The city council has been running downhill. Constructive men are in it, capable and upright men are in it, but they are not equal in political manipulation, or in public clamor, to a number of self-seeking demagogues, who have taken the front places. "In a few years the city council was raised by brilliant and constructive leadership from an organization of crooks to an assembly equal in efficiency and dignity to any legislative body in America, but it has been slipping from that state year after year. Now it is only a noisy debating society, endeavoring to make up in noise what It lacks in information and logic. "The Legislature will be much too busy this coming session on great constructive legislation to pay any attention to the demands of these alder- men so oblivious of their own duties." * * * "good but impotent." (tribune). Under the above caption, on Febrary 16, 1917, the Tribune con- tinued its indictment of Chicago's "Futile City Council" and confessed the hopelessness of improvement, as follows : "The aldermanic primary is upon Chicago, and Chicago has no clear ideas about it. An appraisal of the present city council is not encouraging. The council fought Mayor Thompson and beat him, but after it beat him it accomplished practically nothing. When the present leadership of the coun- cil has nothing to attack it does not know what to do with itself. The two chief problems, gas and traction, are apparently as far from solution as they ever were. We can not escape the conclusion that the Chicago city council is honest but ineffectual. 57 "And the men who are seeking to supplant the present aldermen are, with exceptions, lemons on the candidatorial tree. Changes would likely he for the worse." ****** * "Twenty years ago the outrageous acts of a few men poisoned the puhlic mind. "Since then denunciation of puhlic service corporations is the common- place of all politics, and the support of fair franchise contracts opens the supporter to suspicion. Credit in municipal affairs — not financial credit, but character credit — is bankrupt. "The only way out of the impasse, in which every interest opposes every other interest, is a good and energetic city council. The present council is morally good. It is not energetic. Where it may be called energetic it has not been effectual. And yet a better council is not in sight, and the city is not sufficiently interested to attempt to get one." CHICAGO council's TRACTION RECORD, ETC. As evidence of the Chicago city council's "capacity to deal with public utility problems" the majority report cites the traction question and implies high records made by council committees on local trans- portation, and on gas, oil and electricity, by the board of supervising engineers, etc. (see printed report, page 9). The citations must seem unfortunate even to a casual reader of Chicago papers. It is notorious that Chicago's traction question was the football of politics for ten years prior to 1907 ; and even the results of these ordinances have been by no means satisfactory to Chicago. Chicago gets 55 per cent of the traction company's net receipts — more than $2,000,000 a year — to build subways with. According to the newspapers several sets of subway plans have been made — ^by Bion J. Arnold, by the city's own engineers, and by outsiders. Almost every local election produces a new subway scheme. Yet in ten years not a stroke of subway work has been done. Meanwhile more than $20,000,000 has been piled up in a "fund," or used for something else — nobody seems to know which. Bettering transportation service by increasing elevated lines and working elevated and surface roads as a unit has been talked for ten years, but nothing has been done. I am credibly advised that operation of the surface and elevated lines could have been unified eight or nine years ago on the same basis of valuation and investment return for the elevated properties, as that of the 3907 traction ordinances. If those ordinances of 1907 are as good as it is claimed, wouldn't that unification have been a good thing for the people, with elevated lines for long hauls and rapid transit and surface Hues for short haul feeders, with universal transfers from one to the other? Yet the city council has never given the matter formal consideration. "home rule" street CAR SERVICE. Here is some hastily gathered evidence on how the city council has kept up and bettered the service on Chicago surface lines. A document issued by the Northwest side "L" Extension Associa- tion of Chicago, which I am told represents the substantial people of that section, recites how its efforts to get better service through the 58 State Board of Public Utilities has been fought by the city council, and says: "The city government apparently does not wish to give better service because It is interested in the profits of the City Railways Company and is piling up a large sum each year at the expense of those who pay 5-cent fares. * * * Did you ever travel on a oar where no more could get in, out, on or off? Such service is positively indecent and absolutely unnecessary and all because the railway companies desire to pay dividends, and the city government wishes to pile up a large 'fund' which may be later used for sub- way construction with juicy contracts fruitful with graft. The State Public Utilities Commission prohibits cattle to 6e shipped in this manner. * * * "Demand that the alaermen of the northwest side wards cease their opposition to the State in its fight for better service * * *. "Home rule is proper in some things, but railway, telephone, telegraph, gas and electric lines interest all the people of the State of Illinois and the United States and no special localities. City, village or town governments (advocating as many methods of control as there are officials in each city, village or town) should not have the power to interfere with transportation and communication." THE CHICAGO TRIBUNE SPEAKS AGAIN. The Chicago way of dealing with transportation and other ques- tions of similar importance has been frequently discussed editorially by the Chicago Tribune, as on November 13, 1916, when it said, under "Time to Get Busy With a Subway" : "The way Chicago is neglecting its serious problem of street car trans- portation, it will not be astonishing if the congestion shouM present itself in an Intolerable fashion before any plan at all has been devised * * *. "We seem to be proceeding upon the theory that if once we make up our minds what to do the thing will be done." On November 14, 1916, the Tribune discussed "Chicago Inertia," saying in part : "The general inertia In Chicago when needed improvements are asking for consideration is apparent, but not easily explained. Progress is palsied ^ 4: ih "It seems to be the city's desire to create its governing bodies without a thought of their duties and responsibilities,' and then to decline to under- take any project because the governing bodies are not thought trustworthy." Again, on November 17, 1916, on "Inertia in Chicago," the Trib- une said : "Chicago's inertia in the matter of public improvements is not so much a stagnation of popular will as it is a collapse of official decision * * *. "Seemingly the moment Chicago officialdom encounters a 2-foot obstacle, it sits down to contemplate the insurmountable. The longer the obstacle is looked at, the taller it grows. The people forget they ever granted authority for the enterprise. They pass on to the next case." "the tribune on street car SERVICE." On the specific subject of Chicago transportation service the Chicago Tribune of January 83, 1917, said : "Interminable discussion about franchises, bond issues and the financial complexities of unifying and bettering the Chicago transportation system is exactly what the public does not want. What it wants is rapid and com- fortable means of transportation at a fair rate • * *_ "It has been our habit to solve our problems only after the solution is out-of-date. That is notably our history In transport. In the meantime the burdens of bad service are borne by those who can least afford them." 59 Does that read like a boost for the wisdom of Chicago's city coun- cil as reflected in its handling of transportation ? Read the Chicago Tribune again (editorial of January 30 1917) on the same subject : "When a man has his corns trod upon in the street cars, there is slight consolation In the idea that the city is getting 55 per cent. When he Is forced into indecent juxtaposition to any old or young woman the growing traction fund does not enter his head." And this from the Chicago Tribune of January 31, 1917 (article by Henry M. Hyde) : "Meanwhile the street car service, as every patron knows, grows con- tinually worse. To-day the street cars of Chicago in the rush hours are the best conceivable vehicles of discomfort, indecency and disease. The $2,000,000 which flows yearly into the city's traction fund is actually a tax on the decency of women and girls who are forced to use the surface lines." SOME "home rule" GAS REGULATION. The gas question is another example of the Chicago city council's "capacity to deal with public utility problems." It seems to me that the gas question has been in Chicago politics and in every political campaign there as far back as I can remember. I see by the papers that it is still there ; that a question of new gas rates and new standards of service has been before the council com- mittee on gas, oil, and electricity since a year ago last December, with high priced experts (at $100 a day) on the job and no settlement in sight. During the same period the State Board of Public Utilities has satisfactorily settled several downstate gas questions, all of them as complicated as Chicago's, the only difference being the number of people served and of dollars collected. I am advised that the board of supervising engineers is a surren- der of council authority instead of an instrument of it. Only one of that board's three members represents the city in any way or is subject to any part of the city government. The council has tried repeatedly to acquire some authority over that board, the papers say, but without success. Now let me quote a real "high brow" authority on the Chicago city council's "capacity to deal with public utility problems." Collier's Weekly of January 20, 1917, on the Automatic Telephone case in Chicago said: "$3,300,000 FOR DEAD HORSE." "In our issue of December 6, 1913, we noted editorially an interesting failure of public utility regulation in Chicago. After years of investigation and ratemaking a useless 'competing' telephone company was let in, failed to make a go of it, and had to be bought out, the loss thus saddled on the telephone business being so large as to outweigh all public gains from the rate cases * * ". The older established telephones interests are to pay $5,536,192 for the property, of which only $2,236,192 can be put on their books. The balance ($3,300,000) is a dead loss, a financial corpse for the accountants to bury. Included is a neat little $500,000 which the city will get as 'compensation for the privilege and consent conferred.' No doubt this will make a lot of people think that Chicago has gained by the affair! We have no powers of divination, and so are unable to say where this sizable deficiency of $3,300,000 will be made up; but it is real money, earned from telephone users and now being spent to salvage a piece of foolishness which 60 Chicago did not have brains enough to prevent. This is a perfect instance of how not to do things." That question so feelingly discussed by Collier's was the child of the Illinois Telephone and I'elegraph Company, better known as "The Tunnel' Company." Under an ordinance for conduits to carry tele- phone wires that company began building a tunnel below Chicago's downtown district. On complaint that the tunnel would be in the way of a future subway city officials forced it deeper, but left it a tunnel instead of conduits. Later the city council legalized it as a tunnel, but would not let it be made large enough for any useful purpose. The tunnel is there to-day, practically a dead loss — too small for any kind of transportation, too large and too deep for a telephone or electric conduit, and occupying space where a larger tunnel would be of great service to the city. That was council regulation of public utilities. THREE "home RULe" QUESTIONS. In the light of foregoing quotations, may I ask three questions without being misunderstood and misjudged? They are: (1) Does Chicago really want all the "home rule" asked in its name? (2) What kind of "home rule" does Chicago want — "home rule" by the city council, by the mayor, or by the mayor and council ? (3) What has Chicago done with the "home rule" powers con- ferred upon it in the past ? I have none of the hostility to Chicago and Chicago measures frequently imputed to downstate members of the General Assembly. Through four terms in this House I have voted consistently for all legislation that Chicago seemed to need or desire. To the end of my service here I exf>ect to go on doing so, with a prayer that I may be approximately right half the time. Both experi- ence and observation suggest that Chicago does not always know what it wants from the General Assembly, or does not get its desires cor- rectly interpreted by self-appointed spokesmen, represented in this instance by the majority of the special committee. SOME CHICAGO "HOME RULE" RESULTS. Chicago came to the General Assembly more than twenty years ago for relief from its own inability to get its own property equitably and honestly assessed for taxation. A special session of the General Assembly had to be held in 1897-98, and an entirely new revenue law for the entire State had to he passed, to save Chicago from itself. (Saving Chicago from itself in one particular or another is a perennial task of the General Assembly.) But that did not suffice. In every General Assembly since 1898 Chicago has been after more tinkering and patching of the revenue laws, to protect "itself" against "itself" in revenue matters. Our Australian ballot law was enacted primarily to purify Chicago elections. In that special session of 1897-98 a primary law, mandatory as to Chicago, was enacted to purify the making of nominations there, 61 and our procession of direct primary laws started. Yet hardly a pri- rnary, or a general election, goes by without flaming newspaper head- line's on election frauds and promised criminal prosecutions in Chicago. The history of civil service laws, all originating in Chicago, or Cook County, is much the same — a round of newspaper articles on evasion and defiance of the law, and sometimes indictment and trial of civil service commissioners. A hostile critic could build up a pretty good case on the theory that Chicago has had a lot of laws enacted for its special benefit just for the fun of breaking them, or clamors for new laws to divert attention from its carelessness with the old ones. HOME RULE OFFERED AND REJECTED. Chicago's chaotic local government has been a live topic in the General Assembly and in public discussion between sessions for over twenty years. The absurdity of its multitude of tax-assessing and tax- spending bodies has been conceded ; not a voice has been raised in its defense. Yet recent reports mention some twenty odd of these governmental agencies, all doing business within the city limits of Chicago — several more now than there were when the agitation against them began. Chicago Charter Reform has been another example. ("Home rule" was the slogan on that, too.) Don't you remember those news- paper cartoons showing how "Miss Chicago" had outgrown her little girl clothes almost to the point of indecent exposure ? The State Constitution was amended for the express purpose of letting Chicago have exactly the kind of a "home rule" charter it wanted. A charter convention was organized in Chicago away back in 1905 to do the job of charter building right. It contained, the news- papers said, the best representative brains of that great city, including eminent college professor experts on municipal government from two great universities. It worked more than a year. It framed a model "home rule" charter and put that charter into a bill. The General Assembly passed the bill practically as the charter convention made it. Then the voters of Chicago, on a referendum, beat that charter by a majority of 62,000. "city GOVERNMENT CAN NOT BE TRUSTED." A glaring example of Chicago's need of legislative relief was said to be its "mixed-pickles" park management— two park boards appointed by the Governor, one of them by the Circuit Court judges, one by the mayor, and others elected by the people. The Legislature passed a "home rule" bill — one that was said to be exactly what Chi- cago wanted— putting all the parks under local control. On a refer- endum vote last November park consolidation was beaten by a majority of 116,000. Newspapers which have been strongest for "home rule" opposed park consolidation on the ground that the city government of Chicago could not be trusted to manage the parks. I read in the Chicago Herald of April 38, 1916, that Alderman Merriam had just won "on the fourth round of three years fight for 62 his proposal that aldermen formally bar themselves by council rule from soliciting jobs for constituents from public service corporations." How long would this rule be observed if those aldermen were given direct power to regulate and control those corporations ? AN INGENIOUS "hOME RULE" ARGUMENT. The clinching argument of the majority report for its Chicago bill seems to be (page 10, printed report) that adding the important function of utility regulation to the council's powers will bring better men into the council and improve the city's government. That's like lifting yourself by your own boot straps ; like fire- proofing an old wooden fire-trap by adding a stone porch. That argument is a laugh! If your son was running a grocery at a loss, after long training in that business, would you make up his deficit and then buy him a shoe store and a dry goods store to go on with? Yes, you would — NOT. Chicago has had unlimited "home rule" in the every day business of city housekeeping since it was incorporated. With what result? I am not throwing bricks, but referring only to obvious facts and to what her own people say. The city council abolished smoke, by ordinance, away back in 1881 and has had a srrtoke inspection department to keep it abolished, but I don't see much difference in the consistency of the atmosphere when I go there. "home rule" of streets and finances. Taking care of streets is an ordinary function of city government, yet I see by the papers that Chicago has a paving scandal in every administration, and usually one every year. Only last November there was a fifty-page report by an engineer from our State University on Chicago's bad paving methods. The Tribune's headlines said : "Experts charge paving waste; laborers loaf — EMciency men call work 'miserably managed' and yardage padded; men loaf half the time." With "home rule" in handling city finances, I noticed in the Chi- cago Herald of December 89, 1916, that Chicago couldn't — or wouldn't — pay the sanitary district a contract light bill for $952,802 and the district had to sue and take judgment. I read in the Chicago Herald of January 21, 1917, that the new Commissioner of Public Works said he would, in view of the city's poverty, take a cut of 14 per cent in appropriations for ashes and garbage collection and still keep the service up to that given in 1916. But the finance committee wouldn't let him economize more than 5 per cent. Then I saw these (and too many more to quote) headlines in Chicago papers : "Mayor assails finance iody — Practically accuses it of trying to block Michigan widening." "Chicago broke as council rejects budget — New finance crisis perils all offices." 63 "Oity pay roll political gold mine, charge — Alderman Rodriguez says temporary employees stay on l)ut never take examinations — Good men are let out." That kind of efficiency and harmony would make a fine job of public utility regulation. "home rule of the saloons." Chicago appHed the "home rule" principle in this field for many years to the extent of ignoring the State law on Sunday closing up to a little over a year ago. Then it decided to enforce the State law. Why not, by an amendment to the Sunday closing laws, let Chi- cago have, through a referendum vote, its own Sunday closing laws? Now consider this headline of the Chicago Herald, January 19, 1917 : "Wet aldermen slow to act on a 'wet' report." The article tells how the council license committee (a "wet" committee) appointed a "wet" commission to study the liquor commission. The reports recom- mended certain saloon regulations, which certain reform bodies recom- mended as going in the right direction. Whereupon, the "wet" license committee backed away from the conclusions of its own "wet" com- mission. Is that the kind of thorough and positive action to be applied under "home rule" regulation of public utilities? "home rule" of the police force. All of twenty years ago, I recall, police conditions in Chicago prompted a bill for State control of the department. It was killed in response to the "home rule" argument. Yet the police department has been in the papers ever since (and still is) in a way to indicate that unlimited "home rule" in police affairs has not been an unqualified success in Chicago. Dipping at random into a file of the Chicago Tribune for a couple of weeks in September, 1915, I find these headlines and editorials: "Merriam mixes with Healy in verbal battle." (The article quotes Merriam as saying, "I simply wanted to show that instead of getting down to brass tacks and getting after the crooks the chief has been spending his time making speeches telling what he was going to do.") (Is talking, but not doing, characteristic of Chicago?) "Police changes planned to stop revival of vice." "Thieves reap $200,000 crop in rich homes — Biggest loot total on record taken in city and suburbs — $200,000 jewel harvest this summer." "Police go after slot machines — Chief acts on complaint that gambling with devices is common — Handbooks elusive." "Citizens roused over robberies; plan for action." "Olson assails police arrests — Municipal chief justice declares innocent suffer because of brainless acts." "More Unhindered Crime" * * * In our criminal jurisprudence, as in every other walk of public life, the quack has had too prominent a part. We are a rich and luxurious people and we can Indulge in fads and fancies to an extent denied other nations, but when we devote our police force to super- vising personal conduct and take them away from prevention and detection of crimes, of murder, mayhem and burglary, we become pusillanimous. "The time has come to turn the energy of the police force and the courts into their proper channels, even at the sacrifice of the sprightly adventures of our copesses" (Tribune editorial September 8, 1915). 64 "needless arrests." "The needless arrest of thoUsands of Chicago citizens as cited In a recent declaration of Chief Justice Olson, is a crime against society. The Municipal Court discharges 67 per cent of Its prisoners, says the Judge; 120,000 arrests Is the record of the present year, as against 30,000 a few years ago. This is a startling proof that the city Is making criminals rather than reducing them * • *. "The police department must abandon the idea that the total number of arrests is a measure of efficiency. The public is looking for the prevention of crime." {Trihune editorial September 13, 1915.) "good and bad police work." "* * * The murderers of Charles Victor are not being pursued with any more energy than if they had robbed a peanut stand. * * * Not only was life taken, but It was taken by conspiracy to murder and as a part of a systematic campaign of life taking. "Is the police force ignoring this crime because of the insignificance of the dead man, or because of strong political power supporting the mur- derers?" {Tribune editorial September 14, 1915). "a vicious circle." "Once more Chicago has been reminded of the humiliating fact that lawlessness is so prevalent in the city that private citizens deem it necessary to carry arms in self-defense * * *. "There is nothing particularly new about the present prevalent activity of criminals * * *." {Tribune editorial September 15, 1915). Did "concentrated public opinion", in which the signers of the majority report seem to have such abounding faith, immediately straighten out Chicago's everyday police aflfairs and correct the con- ditions complained of in the foregoing? Scan the headlines of the Chicago Tribune about a year later — just a few of them in October, 1916: "Landis bares Tennes ring of gambling — Details are given up." "Police captains fined for slot machine laxity — Merit board orders pay loss and reprimand for three." "Mont Tennes faces Landis only to dodge, but judge, gets six lists of gambling joints in Chicago — Politics is mixed in." "Gambler aided by prosecutor, Hoyne charges." "Big police shakeup to-day — Two captains' jobs perilled by new order — Vice and gambling exposes to bring drastic action." " 'Dive' letters trap Healey, Hoyne asserts — Captains to be star witnesses in move to indict the chief." "Thrasher says vice indicates corrupt police — Report declares old levee was reviving until com,mittee of fifteen acted." "Stop order on slot machines Healey puzzle — Thousand run until protest of league, then all are hidden." "Bosses shown to rule vice; police pawns — Healey appears dominated by politicians in reopening of dives." "Lively bundle of sensations in Healey case^Oraft, bribes, favoritism, perjury, chicanery, mystery, humor, all in one — A merry day in court." "Chief Healey and secretary indicted — Malfeasance and conspiracy charged." And November started off like this in the headlines : "Politics blinds police to vice, judge avers — Red lights gleam without a raid in two months, declares Fisher." "Sees police and judges aids to cabarets^Mfs. Joseph T. Bowen makes charges against Healey and jurists." 65 Still the power of "concentrated public opinion" did not get into action. The climax of "home rule" police administration in Chicago came with this headline, clear across the front page of the Chicago Tribune, on January 9, 1917: "hoyne arrests healey." That was followed by a flood of headlines proclaiming "Chief of Police Indicted," "Grand Jury Hits 21 in Graft Bills" and variations on these too numerous to count. A new chief of police was appointed. He started in, the news- papers said, to "clean up" the police department and the city. The method adopted was revealed in more headlines : "Schuettler is ready for a police sweep" — "Asserted Larkin and Russel are two of the men who will feel the ax" — "Must appease Hoyne," etc. , Then a few days later came the announcement that Chief Schuettler had "transferred" a lot of policemen and several like announcements have come since. So it appears that after years and years of unlimited "home rule" in police affairs, and after experiences with the vice and crime and police crookedness indicated by the foregoing random quotations, the only policy or method of regulation and control over the public service of its police department which the "concentrated public opinion" of Chicago has been able to develop is that worn-out method of changing the chief of police and transferring policemen. What is the magic in a "transfer" that is supposed to make a good policemen out of a bad one by sending him to another station? Would that be the method applied to "home rule" regulation and control of public utilities? "what's the matter with CHICAGO?" I have quoted the Chicago Tribune on Chicago's "Futile City Council"; also, on the majority report's "mistake," in proposing to give the city council control of public utility regulation when that power should be given a "board to be appointed by the mayor." But the Chicago Daily News, of August 25, 1916, had this to say about the mayor's side of Chicago government: "Citizens of Chicago understand, as downstate voters presumably do not, the demoralization that has been wrought in the government of Chicago under the present administration. * * * It is significant that the Thomp- .^on-Lundin group of politicians is after the offices that can be used pro- fitably." I wonder whether offices having great power over public utility corporations could be used profitably? Are these politicians any worse than their predecessors in power have been or their successors will be ? And the Chicago Herald of December 9, 19.16, had this to say : "Were not the results of the situation so unpleasantly expensive, the plight oC Mayor Thompson would evoke pity. What a picture ho presents. Swept into office by an unprecedented majority less than two years ago, he is now censured by the city council without a dissenting voice for his lack of knowledge of the duties intrusted to him. Not even his partisan adherents would offer a word in his defense * * * 66 "What is the reason for this repudiation unparalleled in the history of Chicago? The council itself makes answer. The mayor has been hu- miliated because of the fact that he subordinated the welfare of Chicago to base ends. To serve his masters, he shoved the garbage plant into politics. To play a sordid partisan role, he struggled to gain possession of the park systems. To indulge the appetites of politicians, he laid rough hands on the schools. "All of this has been viciously unnecessary. Chicago has not asked much of Mayor Thompson. The city only expected a moderately fair deal. Had he been willing to consider first the public interest, the voters would have been content. But consistently every public institution he has touch- ed has been betrayed." But now we find, if these newspapers draw correct conclusions, and as to that I express no opinion, that the trouble with government in Chicago is not only a "futile city council," or a mayor who is "after the offices that can be used profitably" and has "subordinated the welfare of Chicago to base ends," but that the whole plan and system of Chicago city government is wrong. See headlines in the Evening Post, of January 29, 1917: "Merriam asks aiQlition of mayor's office — Starts fight in council for city manager idea and unification of local government — Backs efficiency report — Bureau recommends plan to take place of 'hodge podge' system." And the Chicago Tribune backed up that idea with an editorial on January 30, 1917, saying: "a plan for competent government." "If a saint were mayor and the council composed entirely of geniuses, we should not get good government from them. "The incompetent and the crook can make our public affairs a good deal worse than they might be, but the best of officials can not make them as good as they ought to be. "These ought to be recognized as platitudes. They are, in fact, most outstanding truths of our municipal condition. Yet we go along from cam- paign to campaign thinking, when we think at all, that when we have put one mayor out and another man in his plax;e, we shall somehow be much better off. "The plan of the bureau of public efficiency presented in its report attacks our trouble at its source. It offers the community a real cure for interminable public waste and incompetence. We question the expediency of one or two of its recommendations, but in the main we believe every student of the deficiencies of our local administration will recognize that the plan is sound and offers a program of basic reform which will get us somewhere if we allow it. "« * * -ype shall get nowhere until public opinion organizes a per- sistent force behind some such plan of constructive reform." "evils of divided responsibility." The Chicago Daily News in an editorial under the above caption on Monday, February 19, 1917, which discussed the growing pay roll of Cook County and the reason for it, said : "Positions in most of the elective offices in Cook County are subject to the direction of the judges of the Circuit Court, whom the Illinois Constitu- tion vests with power to fix the number of employees in specified offices. The board of review, however, is given by statute the power to prescribe the number of employees for the assessing bodies. As to these positions, the county board has only authority to fix the salaries. It is required by law to appropriate money to pay for the services of all employees authorized by Other agencies. ''Governtnent constructed In this absurd way can not be made to work satisfactorily from the taxpayers' point of view. "The responsibility is so scattered that blame can not be placed on any one person or agency. Greater concentration of responsibility in affairs of government is a pressing need. This calls for sweeping reorganization, such as Governor Lowden is working to secure for various branches of the State Government." In an editorial on "School Board Legislation" further down in the same column that carried the foregoing on "Evils of Divided Re- sponsibility," The Chicago Daily News, of February 19, 1917, again emphasized the principle that "efficiency is hampered when authority is divided." Division of authority in the regulation of utilities is ex- actly what the "home rule" utihty bills provide for. I have no quarrel with Chicago. I am not a critic of Chicago. I do not wish to be understood by anything incorporated in this docu- ment as criticizing Mayor Thompson or the city council of Chicago. I quote simply that which the Chicago press says and call attention to representations by the Chicago press that inefHciency is rampant in Chicago. My observation is that the Thompson administration is not the first Chicago administration to be so criticized. The question at issue here is not a question of particular mayors or city councils in Chicago or elsewhere. It is a question of getting good results in the broad and important field of public utility regula- tion. That question is the concern of the entire State. Illinois has made a splendid beginning in this field. It can not afford to take a backward step. STATE REGULATION OF PUBLIC UTILITIES HAS MADE GOOD. In Illinois as elsewhere State regulation of utilities has worked well. There is no evidence anywhere, I repeat, that State regulation in Illinois has failed or faltered in respect to Chicago utilities or to those outside of Chicago. To take regulation of Chicago utilities away from the State board now, at this crisis, and transfer that power to some, or any, branch of Chicago's local government, in the light of the foregoing testimony by Chicago newspapers, would be a hazardous experiment, and I am unalterably opposed to it. When "home rule" falls down on the every day routine details of city management and as well fails to adjust great pending problems it is a failure — either in the persons or in the governmental agencies which employ it — and to heap upon it still other problems which are already being effectively handled elsewhere would be worse than a mistake. It would be a crime. CONCLUSION. I recommend that the General Assembly refuse to change the Public Utility Law of Illinois as recommended by the majority com- mittee report, so as to weaken such law and bring chaos into its opera- tions. I favor amending this law so as to give the State Public Utilities Commission control over the municipally-owned utilities and over the 68 warehousing, storing and transporting of food products, to the end that the public utilities of the State may not be used to foster "pools" and "corners" to the detriment of both purchaser and consumer. I recommend that the law be amended so as to allow : (a) Existing utilities the privilege of surrendering all their exist- ing licenses and taking, in lieu thereof, an "indeterminate or revocable permit," and (b) That, in the future, all public utilities be granted a license for no certain period, but that they be given only an "indeterminate or revocable permit." (By an "indeterminate or revocable permit" shall be understood a permit allowing the municipality interested to oust the utility from its functions and acquire all its property and rights whenever the munici- pality desires to operate such utility, either on its own account or through a licensee.) (c) That the commissioners, members of the State Board of Public Utilities, be selected from zones, in each of which zone shall be maintained an ofifice of the commission ; (d) Also that the Governor shall have power, from time to time, if in his judgment the membership of the commission is not large enough, to increase said commission to not to exceed ten members ; (e) The "exclusion," in section ten (10), of utilities now or hereafter owned by niunicipalities should be eliminated. In view of the fact that these recommendations, in order to receive consideration at the hands of the General Assembly, should be pre- sented in the form of specific amendments to the existing law, I will later present a bill providing for such amendments. As no restrictions or control now surround municipally-owned utilities and their existence comes through a different act of the Legis- lature, I have herewith submitted a bill amending such Municipal Ownership Act and recommend its adoption. An "indeteritiinate per- mit" or revocable license can not be granted to a street railroad because of the 20-year limit in the Street Railroad Act of 1889. I have pre- pared, and here submit, a bill to make possible the granting of an indeterminate or revocable permit to street railway companies. I respectfully submit all the foregoing in the hope that it may tend to arrest the attention of the members of the General Assembly suffi- ciently to protect the People of the State of Illinois, against a conflict of authority over the regulation of public utilities, and to the end that the wistiom and good judgment of the Legislature may reach a con- clusion, even though it may not be in harmony with the views of the newspapers of Chicago, that will bring to that city legislative relief, so that Chicago may grow and develop, not for a day or for a generation, but for the many generations that are to come. Respectfully submitted, Thos. N. Gorman. Springfield, III., February 2J, igij.