Question. If you had not published it in your report that Mr. Gondon published, there would not be any question about it.

Answer. You are violating all of the constitutional provisions with regard to freedom of expression. But you have a Government job and you are doing your duty, so go ahead.

Examiner HUDSON. Let that stand as our understanding of the situation.

Mr. WOODEN. What is that, Mr. Examiner?

Examiner HUDSON. As to the attorney's right to ask that kind of questions; that he is simply doing his duty.

The WITNESS. I maintain he has no right to ask them.

Mr. WOODEN. It is always a pertinent question whether a particular line of inquiry is relevant to the issues involved. My position is, he has made it relevant by publishing it here in this report which was put out by

Examiner HUDSON. I do not think that is questioned.

The WITNESS. Yes. It is questioned by my previous statement. I will sum up what I have to say at the end of your examination. Mr. WOODEN. You have probably covered a good deal of it already. The WITNESS. No doubt I have, but repetition is a good thing sometimes.

Mr. WOODEN. I have found it so myself.

The WITNESS. It is an educational process at times for some people. By Mr. WOODEN :

Question. Now, in your Gondon report, exhibit 6088, you have a section devoted to street lighting, and in it you point out the remarkable increase in the amount of street lighting done by the municipal plant and the comparatively small amount done by the Cleveland Electric Illuminating Co.; is that correct?

Answer. Whatever is in the record under that section you can read. I do not vouch for anything you have on that yellow paper. Question. I am not vouching for it myself. If you will not answer, we will have to refer to the document itself.

Answer. There is no reason why I should. You have it all there. Why not put the whole document in and then you will not have to ask all of those questions.

Question. I notice in your 1930 report, exhibit 6089, you make the statement on page 14 that the municipal plant and the Ceico Co. duplicated lighting on the same streets; how did that duplication come about?

Answer. I have nothing to say about it except what it says in the report.

Question. You criticized the duplication as something that was an economic waste to the community, did you not?

Answer. Well, what of it?

Question. Do you not think it is relevant to the question as to how it came about?

Answer. You can ask anybody you want to, but you have the statement there.

Question. It came about under your administration, did it not? Answer. The record speaks for itself. If you were familiar with it, you would know it began long ago.

Question. Is it a fact that the city's investment in street-lighting equipment increased during your administration as much as five times?

Answer. Whatever it says in the record.

Question. I am not asking from the record. Do you think that is a fair approximation of the increase?

Answer. I have no opinion on that subject except what is a matter of record.

Question. You state in exhibit 6088, at page 324, that a reduction in the street-lighting rate was made during your administration, and you refer to certain overcharges that were discovered, including improper pro rata station charges, and that those overcharges were brought to light in recent years and eliminated in corrected calculations which have helped to reduce the rates. Was any study made as to whether those reduced rates were sufficient to cover the cost of the street lighting?

Answer. The statement in there is based upon accurate data.

Question. Were you aware that in 1931 the plant officials, including Mr. Quayle and Mr. Krueger, made a report in which they said the rate for street lighting was insufficient to cover the cost? Answer. That was after I left office.

Question. I say, were you aware of it?

Answer. I have some recollection of seeing something in the paper about it, although I am not clear about it now.

Question. On page 324 of exhibit 6088 you show a reduction in the street-lighting rate between 1920 and 1930 from $0.0349 to $0.03055; were you conversant with the rates for street lighting paid by the city to the Cleveland Electric Illuminating Co.?

Answer. I assume I was. What do you suppose this has to do with your power of investigation under Senate Resolution 83?

Question. I say again that if you had not put these things in a report circulated by the subsidized publication, I would not be asking these questions.

Answer. What of it? Suppose it was. That does not give you any right to ask these questions; not the slightest; you think it does, but you are wrong.

Mr. WOODEN. I would like to state for the record, Mr. Examiner, from Mr. Dickerman's report on the Cleveland Electric Illuminating Co., volume 33-34 of the investigational record, page 47, as follows:

The income to the Cleveland Electric Illuminating Co. from street lighting produced the highest average revenue, 5.2 cents per kilowatt-hour. This covers, beside electric current delivered, the supply of special equipment for that service, such as lamps, brackets, posts, etc., and the labor and materials to maintain them in good condition.

By Mr. WOODEN:

Question. In your 1931 Gondon report, exhibit 6088, you speak of the saving of $40,000 a year to the city by contracting for the maintenance and upkeep of the street-lighting system by private contractor; were you aware that that contract has since been canceled? Answer. No; I am not aware of it.

Question. Did you ever know that the city claimed that the subsequent cost of servicing was only half that paid to the private contractor?

Answer. I heard that political campaign talk.

Question. When did you hear that?

Answer. I do not recall, but it was sometime recently. We have a lot of elections in Cleveland; we have them every time you turn around.

Question. How do you account for such a difference in the streetlighting rate per kilowatt-hour between the Ceico 5.2 cents and the city rate of 0.03055 cent?

Answer. I am not attempting to account for rates of any private company or any public company; I am not here for that purpose. Question. In your 1928 report, exhibit 6090, page 18, did you say that the street-lighting program during the past year, including extensions, had been financed practically all from revenue?

Answer. If you are reading from that statement, that is what it says.

Question. In 1928, did your report, exhibit 6090, recommend a practical doubling in the street-lighting system in 3 years?

Answer. If the recommendation is printed and you are reading it, it must be so.

Question. Did any of that street lighting increase duplicate service on the same streets with the Ceico?

Answer. This is. 1934. I would not attempt to say. It is not pertinent anyway.

Question. There was some duplication in 1930 in your report? Answer. That is not pertinent, anyway.

Question. Did you in 1928, in your exhibit 6090, state that the increased street lighting could safely be made out of earnings?

Answer. I assume you are reading from it; if you are, I do not wish to check you. If you are reading from the exhibit, I will trust you to that extent.

Question. Do you also say in that same report, on page 19, that a proposed reduction in rates which would reduce revenue by $30,000 could safely be made?

Answer. Are you reading from the report?

Question. I am paraphrasing it.

Answer. If it so states in the report, I wrote it.

Question. How would you reconcile such statements with your claim in 1931 that the business was being operated at a loss?

Answer. I would not attempt to reconcile anything with you; you would not understand it if I did.

Question. On page 308 of the 1931 report, exhibit 6088, do you not argue for figuring interest on the entire investment and not restricting it merely to the amount of bonds outstanding?

Answer. Whatever it says in the statement over my name, if you are reading from the statement, that is correct.

Question. I direct your attention specifically to the top of the second column on page 308 and ask you if I am correct?

Answer. If you are reading from the report which is in the record, I assume you are reading correctly.

Question. On that basis, if the entire bonded indebtedness of the plant were retired, you would still figure the interest on the investment should still be calculated?

Answer. The article speaks for itself on the subject.

Question. I am asking you for your present position on the matter. Answer. I am not here to give opinions.

Question. Even if interest on investment were calculated on the entire investment and not merely on the portion which was out of debt, to whom would it be paid in the case of a municipal plant? Answer. I am not called upon to give any opinion on that subject. Question. It would be paid to the city, of course, would it not? Answer. I am not called upon to give any opinion on that subject. Question. In your various calculations of taxes, not only in 1931 but in 1930 and 1928, it was your custom, was it not, to include all taxes, including Federal taxes, as well as local and State taxes?

Answer. Whatever calculations are there would be the method that was followed.

Question. You do not recall what your practice was?

Answer. Whatever the record says.

Question. Were you aware that the accounting firm of ScovilleWellington reported that the allowance calculated, for taxes was too high by $300,000?

Answer. No. I think I heard something about Scoville-Wellington being employed, but you can hire accountants to do any job

you want.

Question. Did you hear on the same occasion that Scoville-Wellington had reported the allowance for depreciation in the municipal plant was too high by $1,500,000?

Answer. I did not hear it. I would not put any stock in ScovilleWellington anyway, because they do not know anything about utility accounting.

Question. They are accountants and engineers as well, are they

not?

Answer. That does not make any difference; there are lots of them. Question. Are they not one of the best-known concerns in the country?

Answer. I do not think I will express any opinion on that subject. Question. Was not publicity given to that audit of Scoville-Wellton Co. on September 15, 1930?

Answer. I do not know.

Question. Do you recall learning of it before you wrote your article in January 1931?

Answer. No. I do not even know when it was made.

Question. Your 1931 report, exhibit 6088, on page 314, says that the policy of the plant has always been to pick and choose its customers in selective territory to make a good showing and not to render service to the whole community or to every home in accordance with the promises in the political campaign of 1911; was that the policy under your directorship?

Answer. What ever it says there is the record.

Question. How was the matter of competition with the Ceico Co. for new business handled?

Answer. The policy for what?

Question. For handling new business which might go either to the municipal plant or to the Ceico Co.

Answer. I never heard of any competitive policy; I do not know anything about it.

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Question. Were there not frequently customers that were available for either the municipal plant or the Ceico plant?

Answer. Maybe so.

Question. And you had no policy one way or the other regarding them?

Answer. What of it? I said I did not know of any competitive policy.

Question. You say here in your report it was the policy to pick and choose its customers in selective territory.

Answer. Let it go at that. You asked me about a competitive policy and I said I did not know of any.

Question. Was there any noncompetitive policy followed in regard to the taking of new customers; new business?

Answer. I do not know of any. This is wholly improper, all of this inquiry.

Question. In your report published by the Utilities Publication Co., exhibit 6088, did you criticize the municipal plant because it did not serve the entire city?

Answer. Whatever is in the report is there.

Question. You were not in favor of its serving the entire city, were you?

Answer. I have not any statement to express on that.

Question. Did you not make a series of recommendations against enlarging or expanding the plant capacity?

Answer. I will say that all of my recommendations are a matter of record.

Question. You did make some of that sort, did you not? Answer. I put in a good many recommendations over a period of years. It is rather difficult to ask anybody to recall all of the recommendations made over a period of 62 years.

Question. Do you think it is consistent to oppose the doing of a certain thing and then criticize because it was not done?

Answer. You are putting words in my mouth, and I object to your question. I think it should be ruled out of order. It is unfair. Question. We will let the examiner rule on it.

Answer. You are assuming that I did something, and there is not any such evidence. It is a matter of opinion. I objectExaminer HUDSON. Do you refuse to answer the question? The WITNESS. I object to the question.

Examiner HUDSON. The witness refuses to answer.

Mr. WOODEN. Would you rule as to whether he should answer? Examiner HUDSON. I think the question should be answered, but the witness refuses.

The WITNESS. It is incompetent and irrelevant, and is just a matter of opinion, and has no bearing upon the question under investigation.

By Mr. WOODEN:

Question. You still refuse to answer notwithstanding the examiner's ruling?

Answer. I have nothing further to say.

Mr. WOODEN. Then I would like to state for the record that these exhibits which are part of the record do show the witness making a number of recommendations against extension or enlargement of the Cleveland municipal plant.

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