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Cooley, Roger W. Handbook of the Law of Municipal Corpora

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Hughes, Robert M. Handbook of Jurisdiction and Procedure in the United States Courts....

433

McMurdy, Robert. The Upas Tree..........

170

Jones, Burr W. Commentaries on the Law of Evidence in Civil Cases

431

Pollock and Morgan. Modern Cities: Progress of the Awakening for Their Betterment, Here and in Europe.....

170

California Law Review

Volume II

NOVEMBER, 1913

No. 1

A Just and Scientific Basis for the Establishment of Public Utility Rates, with Particular Attention to Land Values.*

In the Minnesota Rate Case,1 the original cost of the terminal properties of the Northern Pacific Railway Company in the State of Minnesota was found to be $4,527,228.76. The Master in the United States Circuit Court allowed a return on $17,315,869.45. The original cost of the entire system was found to be something over $312,000,000, but the cost of reproduction new, which the Master took as a basis, was over $452,000,000. The difference of $140,000,000 represented principally the unearned increment of land and the value of donated lands. Of the total reproduction value of the Railway Company's property in Minnesota the value of the land, including percentages for engineering, superintendence, legal expenses, contingencies and interest during construction, amounted to more than 37% of the total.

In the Western Advance Rate Case, decided by the Interstate Commerce Commission on February 22, 1911, the Burlington claimed a return on a present value of $530,000,000. Commissioner Lane found that the original investment was only

1 230 U. S. 352.

2 20 Interstate Commerce Commission Reports, 307.

*A paper read before the Annual Convention of the National Association of Railway Commissioners in October, 1913.

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