1928 Walsh Investigation of U.S. Electric Industry – Part 4

Posted on by July 22, 2019

Following the February 15th, 1928 passage of Senator Thomas Walsh’s Resolution 83 that ordered the U.S. Federal Trade Commission (FTC) to carry out an investigation of the country’s electric industry, the agency worked until the end of 1935 on the probe. Once a month, the FTC produced a summary of the investigation along with all public testimony and exhibits put into the record.

Here is volume 31-40 of the FTC’s monthly summaries.

FTC Investigation: Volume 31 March 15th, 1931 Summary

Washington, March 16, 1931.
To the Senate of the United States:

Pursuant to the direction of the Senate in Senate Resolution No. 83, Seventieth Congress, first session, approved February 15, 1928. regarding the investigation of certain classes of operating electric power and gas utility companies and of holding companies, and associated engineering, finance, and construction companies, that this commission “report to the Senate within each 30 days after the passage of the resolution and finally on the completion of the investigation,” upon the matters specified in the resolution? and that it transmit therewith the stenographic report of the evidence taken, this thirty-first interim report  covering the period from February 15 to March 15, 1931, is respectfully submitted.
Public hearings were held March 2, 3, 4, 5, 6, 10, and 11 , 1931, relating to the New England Co. and its successor, the New England Power Association, and their associated and subsidiary holding, operating, and construction companies. The witnesses were Judson C. Dickerman, Smith W. Brookhart, jr., W. B. Home, Kenneth A. Miller,Roger E. Barnes, Thomas A. Thibodeau, all of the commission’s economic staff. Company witnesses will be called for examination beginning March 17. During these hearings the following reports
were put into the record:
  • Report of Interstate Transmission of Electric Energy of the New England Power Association, by Smith W. Brookhart, Jr. (Ex. 4827.)
  • Inter-corporate Relations among Companies in the New England Power Association Group, by W. B. Home. (Ex. 4828.)
  • Report on Examination of Accounts and Records of the New England Co., by K. A. Miller. Ex. 4833.)
  • Report on Examination of Accounts and Records of the New England Power Association, by R. E. Barnes. (Ex. 4834.)
  • Report on Examination of Accounts and Records of Deerfleld Construction Co., by Thos. A. Thibodeau. (Ex. 4838.)
  • Report on Examination of Accounts and Records of Power Construction Co., New England Power Construction Co., and Sherman Construction Co., of the New England Power Association group, by R. E. Barnes. (Ex. 4839.)
The transcript of the testimony (pp. 13080 to 13677, inclusive) and accompanying exhibits (Nos. 4824 to 4840, inclusive), introduced, are herewith transmitted for printing. The transcript of testimony of the company witnesses to be taken during the current week will be forwarded immediately upon its completion for incorporation in printing with the above in order to have all of the record as to the New England Power Association in one volume.
Since the last interim report, field examination of five large holding companies, two of which are nearly completed, were continued. Work was also continued on an important sub-holding company and on an operating subsidiary of one of the holding companies referred to above. Accountants’ reports were completed on two important operating companies and nearly completed on two large holding companies. A field engineering inspection of physical properties of the New England Power Association group was completed and testimony thereon was presented in the hearings on that group.
Work on reports of the management, servicing, and corporate relations of holding companies, service organizations, and operating companies was continued preparatory to public hearings.
By direction of the commission : C. W. Hunt, Chairman.

FTC Investigation: Volume 32 April 15th, 1931 Summary

Federal Trade Commission,
Washington, April 15, 1931.
To the Senate of the United States:
Pursuant to the direction of the Senate in Senate Resolution No. 83, Seventieth Congress, first session, approved February 15, 1928, regarding the investigation of certain classes of operating electric power and gas utility companies and of holding companies, and associated engineering, finance, and construction companies, that this commission report to the Senate within each 30 days after the passage of the resolution and finally on the completion of the investigation ” upon the matters specified in the resolution, and that it transmit therewith the stenographic report of the evidence taken, this thirty-second interim report covering the period from March 15 to April 15, 1931, is respectfully submitted.
Public hearings were held March 17, 18, 19, and 20, 1931, as to the New England Co. and its successor, the New England Power Association, and their associated and subsidiary holding, operating, and construction companies. The witnesses were:
  • Henry I. Harriman, Boston, Mass., one of the organizers of the system, and vice chairman of the board of the New England Power Association;
  • Frank D. Comerford, president New England Power Association;
  • A. R. Graustein (recalled), president International Paper Co. and International Paper & Power Co. et al.;
  • Thomas H. Carens, assistant to the president New England Power Association, in charge of publicity;

and the following members of the Federal Trade Commission economic staff:

  • J. C. Dickerman,
  • Edwin T. Harris,
  • Lewis G. Prichard.
During these hearings the following reports were put into the record :
  • Control of New England Power Association by International Paper & Power Co., and Management and Supervision Services Rendered by the New England Power Association, by L. G. Prichard.
  • Supplementary Report on New England Power Association and Allied Companies, by E. T. Harris.
  • Report on The Connecticut Valley Power Exchange, by J. C. Dickerman.

Other witnesses were heard and exhibits introduced relating to this group before those above reported. The prior testimony and exhibits were transmitted with the thirty-first interim report.

The transcript of the testimony (pp. 13678 to 14091, inclusive) and the accompanying exhibits (Nos. 4841 to 4855, inclusive) introduced, have been transmitted for printing with the other testimony and exhibits relating to this system which were transmitted with the thirty-first interim report, as therein stated.
Since the last interim report field examinations of two important holding companies, one of which has large natural gas operations, were begun. The field examinations of five holding companies were continued, two of which were nearly completed, and work on an operating company having a large natural gas business was begun. A field engineering inspection of the physical properties of an important electric operating group was completed, preparatory to early hearings.
Two reports on management, servicing, and corporate interrelations of holding companies, service organizations, and operating companies were completed for two groups and work on other groups was continued.
Reports on the transmission of electric energy across State lines were finished for two large holding company groups, and an accounting report on a large operating company was also completed.
By direction of the commission. C. W. Hunt, Chairman.

FTC Investigation: Volume 33 May 15th, 1931 Summary

FEDERAL TRADE Commission,
Washington, May 15, 1931.
To the Senate of the United States:
Pursuant to the direction of the Senate in Senate Resolution 83, Seventieth Congress, first session, approved February 15, 1928, regarding the investigation of certain classes
of operating electric power and gas utility companies and of holding companies, and associated engineering, finance, and construction companies, that the commission “report to the Senate within each 30 days after the passage of the resolution and finally on the completion of the investigation ” Upon the matters in the resolution, and that it transmit therewith the stenographic report of the evidence taken, this thirty third interim report covering the period from April 15 to May 15, 1931, is respectfully submitted.
Public hearings were held on May 13 and 14. They were the beginning of hearings on the North American Co. group. The commission’s witnesses, all of the commission’s economic staff, were:
  • Judson C. Dickerman,
  • W.B. Horne,
  • R. C. Dalrymple, and
  • Smith W. Brookhart, jr.

These witnesses testified in connection with the following reports by them, said reports being put into the record as exhibits:

  • Report on Organization and Activities of the North American Co. in its Relations to Operating Subsidiaries, by Judson C. Dickerman.
  • Report in Interstate Transmission of Electric Energy by the North American Co. in 1929, by Smith W. Brookhart, jr.
  • Inter-corporate Relations Between Companies in the North American Co. Group, by W. B. Horne.
  • Report on Management, Supervision, and Servicing Relations of the North American Co., by R. C. Dalrymple.
  • Report on Organization, Operations, Physical Properties, and Capital Accounts of the  Cleveland Electric Illuminating Co., by Judson C. Dickerman.
Public hearings will be resumed Tuesday, May 19, 1931, at 10 O’clock A.m., when testimony and written reports on the financial structure, history, growth of capital assets, etc., of the North American Co., and North American Edison Co., which is a holding company in the North American group, will be offered for the record.  These hearings will be followed by others dealing with still other companies in the same general group.
Since the last interim report, accountants’ reports were completed on holding and operating companies; management reports were finished on holding and operating companies, and reports on interstate transmission of electric energy were finished on holding company group and 4 operating companies. The field accounting examination was continued on seven holding company groups and on three operating companies. Accounting work was begun on one holding company and one operating company. Preparation of reports on the management, servicing, and corporate interrelations of several holding companies, service organizations, and operating companies were continued, and reports on the transmission of electric energy across State lines are being written for two large holding company groups.  The transcript of the testimony taken on May 13 and 14, as above stated (pp. 14092 to 14226, inclusive), together with the exhibits introduced (Nos. 4856 to 4866, inclusive), are transmitted herewith.
By direction of the commission.  C. W. HUNT, Chairman

FTC Investigation: Volume 34 June 15th, 1931 Summary

Federal Trade Commission,
Washington, June 15, 1931.
To the Senate of the United States:
Pursuant to the direction of the Senate in Senate Resolution 83, Seventieth Congress, first session, approved February 15, 1928, regarding the investigation of certain classes of operating electric power and gas utility companies and of holding companies, and associated engineering, finance, and construction companies, that this commission report to the Senate within each 30 days after the passage of the resolution and finally on the completion of the investigation ” upon the matters specified in the resolution, and that it transmit therewith the stenographic report of the evidence taken, this thirty-fourth interim report covering the period from May 15 to June 15, 1931, is respectfully submitted.
Public hearings on the North American Co. group, begun at an earlier date, were held on May 19, 20, 21, 22, 26, 27, 28, and 29, 1931, and June 2, 3, and 4, 1931. The witnesses (all, except Mr. Gruhl being members of the commission’s economic staff) were:
  • J. C. Dickennan,
  • A. E. Lundvall,
  • C. G. Farwell,
  • C. R. Taylor,
  • A. L. Lyddane,
  • M. S. Anderson,
  • E. R. Lucas,
  • W. B. Horne,
  • LeClaire Hoover,
  • J. W. Adams,
  • T. A. Carroll, and
  • Edwin Gruhl, vice president and general manager of the North American Co.

The witnesses from the commission’s staff testified in connection with the following reports by each (the reports being put into the record as exhibits) :

  • Examination of Accounts, Records, and Operations of the North American Co., by A. E. Lundvall (Ex. 4868).
  • Inter-corporate Relations of North American Edison Co. with the North American Co. and with Other Companies in the North American Co. Group, by W. B. Home (Ex. 4873).
  • Examination of the Accounts, Records, and Operations of North American Edison Co., by C. G. Farwell (Ex. 4874).
  • Inter-corporate Relations of Union Electric Light & Power Co. (Missouri) and Its Subsidiaries with Other Companies in the North American Co. Group, by W. B. Home (Ex. 4876).
  • Examination of Accounts and Records of Union Electric Light & Power Co. (Missouri), by C. R. Taylor (Ex. 4877).
  • Inter-corporate Relations of Union Electric Light & Power Co., of Illinois, with other companies in the North American Co. Group, by W. B. Horne (Ex. 4879).
  • Examination of Accounts and Records of Union Electric Light & Power Co. of Illinois, by A. L. Lyddane (Ex. 4880).
  • Inter-corporate Relations of Power Operating Co. with Other Companies in the North American Co. Group, by W. B. Horne (Ex. 4881).
  • Examination of Accounts and Records of Power Operating Co., by A. L. Lyddane (Ex. 4882).
  • Inter-corporate Relations between Mississippi River Power Co. and its Subsidiary and Other Companies in the North American Co. Group, by W. B. Home (Ex. 4883).
  • Examination of Accounts and Records of Mississippi River Power Co., by M. S. Anderson (Ex. 4885).
  • Inter-corporate Relations between Central Mississippi Valley Electric Properties and Its Subsidiaries and Other Companies in the North American Co. Group, by W. B. Home (Ex. 4884).
  • Examination of Accounts and Records of Central Mississippi Valley Electric Properties, by M. S. Anderson (Ex. 4887).
  • Inter-corporate Relations between Western Power Corporation and Its Subsidiaries and Other Companies in the North American Co. Group, by W. B. Home (Ex. 4890).
  • Inter-corporate Relations Between Great Western Power Co. of California and Other Companies in the North American Co. Group, by W. B. Home (Ex. 4891).
  • Inter-corporate Relations of the California Electric Generating Co. with Other Companies in the North American Co. Group, by W. B. Home (Ex. 4892).
  • Examination of Accounts and Records of Western Power Corporation Group, by E. R. Lucas (Ex. 4893).
  • Examination of Accounts, Records, and Operations of Edison Securities Co., by C. G. Farwell (Ex. 4894).
  • Examination of Accounts and Records of North American Utility Securities Corporation, by C. G. Farwell (Ex. 4895).
  • Inter-corporate Relations of the Wisconsin-Michigan Division of the North Co. and with Other Companies in the North American Co. Group, by W. B. Home (Ex. 4898).
  • Statistical data furnished by the North American Co. and Subsidiaries in Response to Commission’s letter, dated March 29, 1929, analyzed by J. W. Adams (Ex. 4897).
  • Statement of Washington Railway & Electric Co., placed in the record by T. A. Carroll (Ex. 4900).
The following information, relative to New England Power Association group, was placed in the record as exhibits :
  • Statement of Return Earned by Subsidiary Companies of NewEngland Power Association Group for the 12 Months Ended December 31, 1929, by LeClaire Hoover (Ex. 4867).
  • Investment Income and Rates of Return for Narragansett Electric Co. and their subsidiaries, by LeClaire Hoover (Ex. 4872).
Since the last interim report, 10 accountants reports were completed on operating companies; management reports were finished on three operating companies, and reports on interstate transmission of electric energy were finished on three operating companies. The field accounting examination was continued on six holding company groups and on three operating companies. Accounting work was begun on one operating company. Preparation of reports on the management, servicing, and corporate interrelations of several holding companies, service organizations, and operating companies were continued, and reports on the transmission of electric energy across State lines are being written for two large holding company groups.
The next public hearings are scheduled to begin June 16, 1931, and will relate to Pacific Power & Light Co., Northwestern Electric Co., Inland Power & Light Co.? Idaho Power Co., and the Minnesota operations of the Phoenix Utility Co. They are owned by American Power & Light Co. and Electric Power & Light Corporation, a holding company in the Electric Bond & Share Co. group, and are supervised by the last-named company. Transmitted herewith is the testimony taken at the hearings held from May 19 to June 4, 1931, inclusive, as above stated (pp. 14,227 to 15,435 inclusive) , together with the exhibits introduced, i. e., Nos. 4867 to 4905, inclusive, except No. 4903 not offered and Nos. 4867, 4872, and 4905 incorporated in printing in parts 31 and 32 (q. v.).
By direction of the commission: C. W. Hunt, Chairman.

FTC Investigation: Volume 35 July 15th, 1931 Summary

Federal Trade Commission,
Washington, July 15, 1931.
To the Senate of the United States:
Pursuant to the direction of the Senate in Senate Resolution 83, Seventieth Congress, first session, approved February 15, 1928, regarding the investigation of certain classes of operating electric power and gas utility companies, and of holding companies, and associated engineering, finance, and construction companies, that the commission “report to the Senate within each 30 days after the passage of the resolution and finally on the completion of the investigation,” upon the matters specified in the resolution, and that it transmit therewith the stenographic report of the evidence taken, this thirty fifth interim report covering the period from June 15 to July 15, 1931, is respectfully submitted.
Public hearings, which were begun June 16 on the Northwestern Electric Co., Pacific Power & Light Co., and Inland Power & Light Co. of the Electric Power & Lift Co. group, and Idaho Power Co. of the American Power & Light Co. group, subsidiaries of Electric Bond & Share Co., were continued on June 17, 18, and 25, 1931. The commission’s witnesses, all of the economic staff, were
  • J. C. Dickerman,
  • E. T. Harris,
  • LeClaire Hoover,
  • Smith W. Brookhart, jr.,
  • W. B. Horne, and
  • H. H. Carter.
These witnesses testified in connection with the following reports, which were put into the record as exhibits:
  • Interstate Transmission of Electric Energy by Northwestern Electric Co. and Pacific Power & Light Co. and Idaho Power Co., by Smith W. Brookhart, jr. (Exhibits 4906 and 4917.)
  • Report, schedules, and appendixes, examination of accounts and records of Pacific Power & Light Co., Northwestern Electric Co., and Inland Power & Light Co., by E. T. Harris. (Exhibits 4912, 4913, and 4914.)
  • Report, exhibits, and appendixes, report on examination of accounts and records of Idaho Power Co., by E. T. Harris. (Exhibits 4920, 4921, and 4922.)
  • Supervision, special services, and engineering contracts of the Pacific Power & Light Co., Northwestern Electric Co., Inland Power & Light Co., and Idaho Power Co., by H. H. Carter. (Exhibits 4908 and 4918.)
  • Inter-corporate relations between Pacific Power & Light Co., Northwestern Electric Co., Inland Power & Light Co., and other companies in the American Power & Light Co. group, by W. B. Horne. (Exhibits 4909, 4910, and 4911.)
  • Inter-corporate relations between Idaho Power Co. and its subsidiaries with the Electric Power & Light Corporation, by W. B. Horne. (Exhibit 4919.)
  • Organization, physical properties, and operations of Idaho Power Co., by J. C. Dickerman. (Exhibit 4923.)
  • Report and exhibits on Minnesota operations of Phoenix Utility Co., by Le Claire Hoover. (Exhibit 4924.)
  • Physical properties, operating conditions, and operating results of the Minnesota Power & Light Co., by J.C. Dickerman (Exhibit 4925.)

On June 25 a number of items on the publicity or propaganda phase of the investigation were put into the record. Among these was a compilation showing distribution in schools, by State committees on public-utility information, of electricity and gas pamphlets, and miscellaneous literature for 1927 except as otherwise noted (Exhibit 4928); and a compilation showing newspaper publicity as reported by the State public utility information committees or bureaus (Exhibit 4938) ; certain additional selected responses by educators to the Dean Ruggles questionnaires with a sample of each form of the questionnaires which were sent to the various universities and school men, in his survey undertaken under the pay and auspices of the National Electric Light Association (Exhibit 4928). There were also put into the record the rate books published by the National Electric Light Association for the years 1928, 1929, and 1930, and change sheets for the year 1930 (Exhibits 4932, 4933, 4934, and 4934-A).

Since the last interim report, accountants’ reports were completed on one group of operating companies and on one large holding company. The field accounting examination was continued on five holding company groups and on three operating companies. Accounting work was begun on one holding company. Preparation of reports on the management, servicing, and corporate interrelations of several holding companies, service organizations, and operating companies were continued, and reports on the transmission of electric energy across State, lines are being written for two large holding company groups. A field engineering inspection of the generating stations, transmission and distribution systems, and study of the operating costs of an important operating company was made.
On June 25 adjournment was taken until after Labor Day. During the intervening period field work and preparation of reports for hearings will continue. No further interim report will be submitted until after the resumption of hearings.
Transmitted herewith is the testimony taken at the hearings on June 17, 18, and 25, 1931, as above stated (pp. 15436 to 15731, inclusive), together with the exhibits introduced (Nos. 4906 to 4940, inclusive).
By direction of the commission. C. W. Hunt, Chairman.

FTC Investigation: Volume 36 October 16th, 1931 Summary

Federal Trade Commission,
Washington, October 16, 1931.
To the Senate of the United States:

Pursuant to the direction of the Senate in Senate Resolution 83, Seventieth Congress, first session, approved February 15, 1928, regarding the investigation of certain classes of operating electric power and gas utility companies and of holding companies, and associated engineering, finance, and construction companies, that the commission ” report to the Senate within each 30 days after the passage of the resolution and finally on the completion of the investigation,” upon the matters specified in the resolution, and that it it transmit therewith the stenographic report of the evidence taken, this thirty-sixth interim report covering the period from July 16, 1931, to October 14, 1931, inclusive, is respectfully submitted.

Public hearings were resumed on September 20, 1931, and hear ings were held on September 29, September 30, October 1, 2, 13, and 14. The reports and testimony presented related to Standard Gas & Electric Co. and Oklahoma Gas & Electric Co., of the Standard group.

The witnesses, all of the commission’s economic staff, were:

Thomas W. Mitchell, Smith W. Brookhart, jr., W. B. Home, John D. Mullock.

These witnesses testified in connection with the following reports which were put into the record as exhibits :

  • Report on Standard Gas & Electric Co., Organization and Control of Principal Acquisitions of Standard Gas & Electric Co. (Vol. I), and Growth of Capital Assets and Liabilities, Financing and Rates of Return (Vol. II), by T. W. Mitchell. (Com. Exs. 4941 and 4942.)
  • Report on Examination of Accounts and Records of Oklahoma Gas & Electric Co. of the Standard Gas & Electric Co. group, by John D. Mullock. (Com. Ex. 4950.)
  • Report on Interstate Transmission of Electric Energy by Standard Gas & Electric Co. group in 1929, by Smith W. Brookhart, jr. (Com. Ex. 4945.)
  • Report on Intercorporate Relations of Companies in the Standard Gas & Electric Co. group, by W. B. Home. (Com. Ex. 494(5.)
  • Report on Examination of Accounts and Records of Oklahoma Gas & Electric Company of the Standard Gas & Electric Co. group, by John D. Mullock. (Com. Ex. 4950.)
  • Report of Interstate Transmission of Electric Energy by Oklahoma Gas & Electric Co., by Smith W. Brookhart, jr. (Com. Ex. 4949.)

Since the last interim report, accountants’ reports were completed on four holding companies, and on three operating companies. Accounting work was begun on three operating companies. Preparation of reports on the management, servicing, and corporate interrelations of several holding companies was continued, and reports on the transmission of electric energy across State lines are being written for one large holding company group. A field engineering inspection of the generating stations, transmission and distribution systems and studies of the operating costs of three important operating company groups were made.

Transmitted herewith is the testimony taken at the hearings held from September 29 to October 14, inclusive, as above stated (pp. 15752 to 16360), together with the exhibits introduced (Nos. 4941 to 4953, inch).

By direction of the commission. C. W. Hunt, Chairman.

FTC Investigation: Volume 37 November 17th, 1931 Summary

Federal Trade Commission,
Washington, November 17, 1931
To the Senate of the United States :

Pursuant to the direction of the Senate in Senate Resolution 83, Seventieth Congress, first session, approved February 15, 1928, regarding the investigation of certain classes of operating electric power and gas utility companies and of holding companies, and associated engineering, finance, and construction companies, that the commission ” report to the Senate within each 30 days after the passage of the resolution and finally on the completion of the investigation,” upon the matters specified in the resolution, and that it transmit therewith the stenographic report of the evidence taken, this thirty-seventh interim report covering the period from October 16, 1931, to November 15, inclusive, 1931, is respectfully submitted.

Public hearings were held October 28, 29, 30, and November 2, 9, and 10, 1931. The reports and testimony presented related to various companies of the Kentucky group of companies of the Standard Gas & Electric Co. group, concerning which group presentation of reports and testimony was begun on September 29, 1931. The witnesses, each of the commissions economic staff, were : Andrew W. Wilcox, Judson C. Dickerman, Smith W. Brookhart, jr.

They testified in connection with the following reports, which were put into the record as exhibits :

Andrew W. Wilcox :

  • Report on examination of accounts and records of Louisville Gas & Electric Co. (Ky.) (Ex. 4961);
  • Kentucky Coke Co. (Ky.) (Ex. 5962) ;
  • Louisville Hydro-Electric Co. (Del.) (Ex. 4963) ;
  • Kentucky Pipe Line Co. (Ky.) (Ex. 4964) ;
  • Kentucky Pipe Line Co. (Ind.) (Ex. 4965) ;
  • Ivyton Oil & Gas Co. (Ky.) (Ex.4966) ;
  • Ivyton Oil & Gas Co. (Del.) (Ex. 4967) ;
  • Madison Light & Power Co. (Ind.) (Ex. 4968;
  • Louisville Gas & Electric Co. (Del.) (Ex. 4969) ;
  • Louisville Gas &. Electric Co. (Del.) and subsidiaries (Ex. 4970) ;
  • Louisville Gas & Electric Securities Co. (Ky.) (Ex. 4972).

Judson C. Dickerman:

  • Report on physical properties, operation and organization of Louisville Gas & Electric Co. and affiliated companies. (Ex. 4954).

Smith W. Brookhart, Jr.:

Report on interstate transmission of electric energy of Louisville Gas & Electric Co. (Ex. 4960).

Since the last interim report accountant’s reports were completed on three operating companies. Field accounting work was completed on 2 operating companies and was continued on 5 holding and 6 operating companies. Preparation of reports on the management, servicing, and corporate interrelations of several holding companies was continued, and a report on the transmission of electric energy across State lines is being written for one large holding company group. Field, engineering inspection of the generating stations, transmission and distribution systems, and studies of the operating costs of two operating companies in important holding company groups was begun. Transmitted herewith is the transcript of testimony taken at the hearings held from October 16 to November 15, 1931, as above stated (pp. 16361 to 16835, incl.), together with the exhibits introduced (Nos. 4953 to 4972, inch).

By direction of the commission. C. W. Hunt, Chairman

FTC Investigation: Volume 38 December 16th, 1931 Summary

DECEMBER 16, 1931.
To the Senate of the United States:

Pursuant to the direction of the Senate in Senate Resolution 83, Seventieth Congress, first session, approved February 15, 1928, regarding the investigation of certain classes of operating electric power and gas utility companies and of holding companies, and associated engineering, finance, management, and construction companies, that the commission “report to the Senate within each 30 days after the passage of the resolution and finally on the completion of the investigation,” upon the matters specified in the resolution, and that it transmit therewith the stenographic report of the evidence taken, this thirty-eighth interim report covering the period from November 16, 1931, to December 15, 1931, inclusive, is respect fully submitted.

Public hearings were held November 17, December 1, 2, 3, 4, 8, 9, 10, 11, and 15, 1931. The testimony and exhibits presented on November 17, 1931, related to investment, earnings, and rates of return of the Louisville Gas & Electric Co. and associated companies.

The hearings beginning December 1 and concluding December 11, 1931, related to Middle West Utilities Co. and four subsidiaries, all of the Insull group. The witnesses from the commission’s economic staff were: William H. England, Thomas W. Mitchell, Asel R. Colbert, Frank Buckingham, M. C. Steele, W. B. Horne, and H. H. Carter.

The following company witnesses were called:

  • William J. Hagenah, vice president Byllesby Engineering & Management Corporation;
  • Martin J. Insull, president Middle West Utilities Co.;
  • E. A. Davis, vice president and comptroller Middle West Utilities Co.

The commission’s witnesses testified in connection with the following reports and statements which were put into the record as exhibits:

  • William H. England: Map: Territories served by Middle West Utilities System. (Exhibit 4985.)
  • Thomas W. Mitchell: Statement: Investment (revised), earnings, and rates of return, Kentucky Pipe Line Co. (Kentucky). (Exhibit 4973.)
  • Statement: Investment, earnings, and rates of return, Louisville Gas & Electric Co. (Delaware). (Exhibit 4974.)
  • Statement: Investment (revised), earnings, and rates of return, Louisville Gas & Eelectric Co. (Delaware). (Exhibit 4975.)

consolidated of– statement: Investment (revised), earnings, and rates of return

  • Louisville Gas & Electric Co. (Kentucky).
  • Kentucky Pipe Line Co. ( Kentucky).
  • Kentucky Pipe Line Co. (Indiana).
  • Kentucky Coke Co. (Kentucky.)
  • Louisville Hydro-Electric Co. (Delaware).
  • Ivyton Oil & Gas Co. (Delaware). (Exhibit 4976.)
  • Asel R. Colbert: Report (accounting) on Middle West Utilities Co., covering the period May 3, 1910, to September 30, 1930, inclusive. (Exhibit 4982.)

Exhibits accompanying report Exhibit 4982. (Exhibit 4983.)

  • Report on L. E. Myers Co., a subsidiary construction company of Middle West Utilities Co. (Exhibit 4984.)
  • Frank Buckingham: Report on examination of accounts and records of North West Utilities Co. (Exhibit 4986.)
  • M. C. Steele: Report on examination of accounts and records of Mississippi Valley Utilities Investment Co. (Exhibit 4987.)
  • Report on United Public Service Co. (Exhibit 4988.)
  • Exhibits on United Public Utilities Co. (Exhibit 4989.)
  • Statement, return on common stock investments in each of the subsidiaries of United Public Service Co. (Exhibit 4990.)
  • W. B. Horne: Chart, Insull group, corporate chart of Middle West Utilities Co., subgroup, showing per cent of voting control as of December 31, 1930.(Exhibit 4978.)
  • Chart, Insull group, November 21, 1931. (Exhibit 4979.)
  • Chart, Insull group, Middle West Utilities Co., showing kind of service and localities of operations and population. (Exhibit 4980.)
  • H. H. Carter: Report on interstate transmission of electric energy by Middle West Utilities System, 1929–30. (Exhibit 4981.)
  • On December 15 hearings were begun on the North American Light & Power Co. group.

Since the last interim report, accountant’s reports were completed on two operating companies. Field accounting work was begun on another important sub-holding company. Study of servicing and corporate interrelations of several holding companies was continued, and a report on the transmission of electric energy across State lines is being written for one large holding company group. Field engineering inspection of the generating stations, transmission and distribution systems, and studies of the operating costs of operating Companies in important holding company groups was finished, an partly completed for another large group.

Transmitted herewith is the transcript of testimony taken at the hearings held from November 16 to December 15, 1931, witnesses as above stated (pp. 16836 to 17736, inclusive), together with the exhibits introduced (Nos. 4973 to 4990, inclusive).

By direction of the commission. C. W. HUNT, Chairman.

FTC Investigation: Volume 39 January 15th, 1932 Summary

FEDERAL TRADE COMMISSION,
Washington, January 18, 1932.
To the Senate of the United States:

Pursuant to the direction of the Senate in Senate Resolution 83 Seventieth Congress, first session, approved February 15, 1928, regarding the investigation of certain classes of operating electric power and gas utility companies and of holding companies, and associated engineering, finance, management and construction companies. that the commission “report to the Senate within each 30 days after the passage of the resolution and finally on the completion of the investigation,” upon the matters specified in the resolution, and that it transmit therewith the stenographic report of the evidence taken, this thirty-ninth interim report covering the period from December 16, 1931, to January 15, 1932, inclusive, is respectfully submitted.

Public hearings were held December 15, 16, 17, and 18, 1931, and January 12, 1932. The testimony and exhibits presented related chiefly to the investment earnings and rates of return of the North American Light & Power Co., and the companies of that group Besides matters relating to the North American Light & Power Co. there was presented a report of a survey of the physical properties of the North American Co. in California, and a consolidated balance sheet of the Kentucky Power Co., and subsidiaries of the Middle West Utilities group. The witnesses from the commission’s economic staff were Kenneth A. Miller, L. G. Prichard, S. W. Brookhart, jr., W. B. Horne, J. W. Adams, J. C. Dickerman, M. C. Steele.

The following company witnesses testified:

  • Clement Studebaker, jr., president North American Light & Power Co.
  • W. D. Gale, assistant treasurer North American Light & Power Co.
  • Charles N. Wheeler, assistant to the president Light North American & Power Co.
  • Oliver E. McCormick, vice president and treasurer Middle West Co.
  • Blanch A. McCormick, formerly assistant treasurer Middle West Co.

The commission’s witnesses testified in connection with the follow in reports and statements, which were put into the record as exhibits.

  • Kenneth A. Miller, report on financial structure of North American Light & Power Co. covering the period April 16, 1915, to December 31, 1929. (Exs. 5000–5003, inclusive.)
  • L. G. Prichard, report on management, supervision, and servicing of North American Light & Power Co. (Exs. 4998 and 4999)
  • S. W. Brookhart, jr., report on interstate transmission of electric energy by North American Light & Power Co. system in 1929–30. (Ex. 4994.)
  • W. B. Horne, corporate chart of North American Light & Power Co. group. (Ex. 4995.)
  • Report on inter-corporate relations of com panies in the North American Light & Power Co. group. (Ex. 4991.)
  • J. W. Adams, map of electric light and power properties of North American Light & Power group. (Ex. 4992.)
  • Map of gas properties of the companies in the North American Light & Power Co. group. (Ex. 4993.)
  • J. C. Dickerman, report on properties of the North American Co. in California as of May, 1930. (Ex. 5008.)
  • M. C. Steele put in a consolidated balance sheet of the Kentucky Power Co., and its subsidiaries. This company is in the United Public Service group of the Middle West Utilities Co. (Ex. 4991.)

Since the last interim report, field examination of a large holding company was completed, and the examination of an operating company in the same group was begun. Accountant’s reports for an important holding company, a sub-holding company and two operating companies were completed. Field work was continued on 3 holding companies, 6 sub-holding companies, 2 securities companies, and 6 operating companies. Study of servicing and corporate interrelations of several holding companies was continued, and a report on the transmission of electric energy across State lines is being written for another large holding company group.

Transmitted herewith is the transcript of the testimony taken at the hearings, from December 16, 1931, to January 15, 1932, of witnesses as above stated (pp. 17737 to 18321, inclusive), together with the exhibits introduced §. 4991 to 5010, inclusive).

By direction of the commission: C. W. HUNT, Chairman.

FTC Investigation: Volume 40 February 15th, 1932 Summary

FEDERAL TRADE COMMISSION,
Washington, February 15, 1932.
To the Senate of the United States:

Pursuant to the direction of the Senate in Senate Resolution 83, Seventieth Congress, first session, approved February 15, 1928, regarding the investigation of certain classes of operating electric power and gas utility companies and holding companies, and associated, engineering, finance, management, and construction companies, that the commission “report to the Senate within each 3, days after the passage of the resolution and finally on the completion of the investigation,” upon the matters specified in the resolution, and that it transmit therewith the stenographic report of the evidence taken, this fortieth interim report covering the period from January 16 to February 15, 1932, inclusive, is respectfully submitted Public hearings were held January 28, 29, and February 2,3,4, and 5, 1932.

The testimony and exhibits presented related to National Electric Power Co., National Public Service Corporation, and Eletric Management & Engineering Corporation, each a part of the Middle West Utilities (Insull) group. The witnesses, both from the commission’s economic staff, were: Aaron J. Hughes and T. C. Lacey. They testified as to the following reports which were put into the record as exhibits:

  • Report by A. J. Hughes with exhibits and appendices on examination of accounts and records of National Electric Power Co. (Exhibit 5011–5012.)
  • Report by A. J. Hughes with exhibits and appendices on examination of accounts and records of Electric Management & Engineering (Ex. 5014.)
  • Report by T. C. Lacey and exhibits on management, super; vision, and servicing relations of National Electric Power Co. and Electric Management & Engineering Corporation. (Ex. 5015.)
  •  Report by A. J. Hughes and exhibits on examination of ac §§ and records of National Public Service Corporation. (Ex. 5016.

Since the last interim report an accounting field examination was begun on two operating companies in one of the largest holding company groups. Accountant reports were completed for an important sub-holding company and for an operating company in another group. Engineering reports were completed on two important companies. Field work was completed on 1 holding company and 1 sub-holding company and continued on 2 holding companies, 4 sub-holding companies, 2 securities companies, 1 servicing company, an 7 operating companies. The study of servicing and inter-corporate relations was continued on several holding company groups, and a report on the transmission of natural gas across State lines for a large holding company group was completed. A field engineering inspection and study of operating efficiencies was begun on a group if operating companies in the South Atlantic States. Hearings will be resumed on February 16, when reports and testimony relating to Tide Water Power Co., another Insull company,
will be presented.

Transmitted here with is the transcript of the testimony presented it the hearings from January 16, 1932, to February 15, 1932, of above witnesses (pp. 18,322 to 18,952, inclusive), together with exhibits introduced (Nos. 5011 to 5016, inclusive).

By direction of the commission. W. E. HUMPHREY, Chairman.

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