tendent who has direct charge of the necessary janitors, gardeners, engineers and firemen and night watch. The main capitol building was erected in the '70s at an estimated cost of $500,000.00. The Supreme Court and Library building was erected in 1913 at a cost of $320,000.00, and is one of the modern Class A buildings of the State.

In conclusion will say I have brought with me a sufficient number of Blue Books to supply your needs. As you may know, the Blue Book is a compilation of our office. The information it contains is essentially pertinent to the subjects that have been and will be discussed before you. I trust they may prove of value and assistance to you.

The Need for a Consistent General State Policy as to Public Utilities

BY CLYDE B. AITCHISON, MEMBER OREGON PUBLIC SERVICE COMMISSION

There are undoubtedly many more public utility users than there are taxpayers; and the public utility's bill has to be met each month, while the tax collector is settled with but twice a year. There is not a man, woman, or child in any remote or undeveloped portion of our State whose life, according to present-day conventions, is not shaped by the conveniences which have become necessities afforded by the public utility. The business of public service is so interwoven into the warp and woof of the body politic that the man from Mars might expect to find the state itself performing all these utility functions, either directly or through its municipal agents, as a part of its duty to provide for the general peace, health, safety and convenience. And, indeed, in many lands, as to many forms of public service, the state has undertaken these public functions; while in our country some utility services, such as the transportation of the mails, are exclusively reserved for the nation and there is no form of public utility service in which the nation, some of the states, or many municipal governments, are not engaged. The business performed by the public service corporation is essentially governmental in character, and it is only because it has been deemed best as a matter of legislative policy to entrust the business to private hands, as trustees for the state, that the private corporation finds itself engaged in this quasi governmental calling.

It might be expected that the state, and every state, which had determined to entrust such far-reaching powers of government into private hands would have formulated a clearly defined, well considered, logical policy which it had determined to follow in its dealings with the private agencies which perform such important functions for the commonwealth. It might be expected that all of the relations between the state and the private corporation engaged in the public service would be adjusted with a single thought kept clearly in mind: that these public services might be performed in the most

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efficient, economical, and equitable manner for the whole body politic. It might be taken as assumed, if we did not know the contrary, that the ultimate welfare of the body politic would be the single thought underlying the whole system of administration, so far as this subject is concerned.

It is obvious that there is no such concert of motives. A private concern which would similarly drift along without a well defined central idea or business policy and which failed to subordinate immediate and minor matters to the achievement of the ultimate object would soon be in the breakers. In the dealings between the states and the utilities, we find confusion, a division of authority and responsibility among departments of the government, an entire and open lack of coordination, no developed central idea of what the state really expects of its public utilities, or as to what is essential and what is nonessential in the details of the relationship.

If we analyze the situation, the inconsistencies of our present system will be found due to the division of authority, and the tendency to regard that which is immediately possible and apparently advantageous, and which can be done legally as more desirable than the less clearly defined ultimate object for which public service is performed. But what we can do legally, today, is one thing; whether, in the long run, we should do it, is another. Often today's advantage is tomorrow's loss; a skirmish has been won and a campaign lost.

The tardy recognition of the intimate connection between the functions of the utility and the welfare of the community, and then, latterly, a sudden appreciation of the importance of the relationship, has resulted in much recent legislative action, often seemingly taken on the spur of the moment to meet a particular situation which has presented itself. Constitutional limitations have made it impossible for us to avoid a division of jurisdiction between the state and interstate commerce, between matters of state police authority and those which are purely municipal in nature. Diverse jurisdictions, each dealing with a single phase of the activities of a utility which is serving all of them-each political authority anxious to make the best possible showing before its own citizens and entirely heedless of the effect of its acts upon the citizens of

other jurisdictions-manifestly present an administrative system not conducive to a consistent and statesmanlike general policy. This division of jurisdictions will always be with us in some form; and it is, and will be, an extremely difficult task to put into operation any policy as long as authority is so split up and men continue to be short sighted and selfish. It does not seem impossible, however, to minimize the conflicts, and possibly we can work out a policy which can be lived up to with comparative consistency.

The utilities are not entirely blameless in this regard. Every regulating officer is familiar with the manner in which upon occasion one jurisdiction or tribunal has been played off as against another. The utility's policy has not always been the far-sighted and consistent one of regarding the ultimate good of the community as more important than the momentary advantage of the utility.

For the purpose of this discussion it must be taken as assumed that the state has decided to continue the general plan of depending upon private enterprise in the main for the operation of its public utility service, but has not waived its right to engage in the same business when deemed best. Indeed, when the interests of the body politic can best be served by a municipal ownership and operation of any particular public service, or all public services, the right carries with it the duty. This general policy necessarily implies such an adjustment between the state and the private citizen who engages his personal services and money, that each will derive the utmost benefit from the transaction consistent with the correlative and opposing rights of the other party.

Manifectly, a well rounded policy would take into consideration such matters as the granting of the right to engage in the public service; the insistence upon financial methods which will insure the permanency of the enterprise; the requirement of a progressive service standard and elastic service limits, and of rates which will compare favorably with those for which the state or municipality could supply itself, adjusted with the inexorable equality of governmental action. The relationship between the state and the utility has already been said to be based upon convenience and when the state desires

to resume the performance of the service, it should be permitted to replace the existing utility upon terms which are fair and just. It would defeat the policy to make the business of public service so undesirable, hazardous or unprofitable upon the whole that private citizens will not engage their time or means therein.

To slightly paraphrase a portion of an address by Commissioner Prouty, as chairman of the Interstate Commerce Commission, to a gathering composed of railroad and public service commissioners from the whole United States:

The public service corporation is a public servant. That phrase comes from the Supreme Court and has been for a quarter of a century in the mouth of everybody who has had to do with this subject. It comes, as time goes on, to take on a different meaning. Originally the people said, "It is our servant; therefore we can kick and cuff it ad libitum." But it is coming to be understood that just as a servant can only properly discharge his duties when he is suitably fed, clothed and housed, so the public service corporation can only properly discharge its duties when it receives proper treatment from the public.

To go a step further than the chairman in his figure: Our servants owe us the duty of obedience, loyalty, willing effort and of non-interference with our internal affairs. We may abuse our present hired help, but only by being just to our present servants, paying living wages, and giving reasonable comforts can we expect others who are not under compulsion to enter our employment and labor loyally in our interest. There is a well marked distinction between a course of conduct on the part of the state administration to which existing public utilities may have no legal right to complain, and the results of such a policy. No one can be forced, in the future, against his will, to enter the public utility service. He will enter the service or keep out of it, largely according to the manner in which existing utilities are dealt with. This will not be overlooked in the construction of a rational administration policy.

Of course the state must have the right to say who should engage in a business governmental in character. The grant of special powers with respect to the exercise of the right of