655 riate counsel; and C. F. Commission. Bei I Hagenah, Chicag. Ray Garrett. 310 Sora Mengn Atene Griffith, 122 South Kimura T Chicago District Pine L Examiner Ansis The tennar vi "cETI INS Mr. WALSH. The beazor is dienen = in the Pipeline Co., where SESS Gas Investment C. Som heter S the Peoples Gas Strsitat the Peoples Gas Lee the France Seam, we n Illinois and the Whom Turi (Droi amed companies are gear USERS PROTES ty of Chicago. I mpanies. Mr. GARRETT. The Cunt Decon Roeloe Chiwets to the ading of any hearts of the advorem jede ncerning its afais recent vid de Cassie s under Serate RewittinS on or inquisitorial auto png strict Pipeline Comber the gaged in any interstate te public utility emotie temaalsed and engaged in holly within the State of LS The jurisdiction of the Commisite des pot extend to a ay stock of any other corporation. Any jurisdiction or authority of the Commission to investigate nd report on Natural Gas Pipeline Co. of America and Texoma Satural Gas Co. does not confer upon the simmission any jurisdic fon over Chicago District Pipeline Co, not conferred by the resolaon. The physical connection of pipe lines and the contract of Chicago District Pipeline Co. to purchase natural gas from Natural Gas Pipeline Co. of America do not alter the separate and lependent status of Chicago District Pipeline Co. under the olution. In the course of the Commission's investigation of Natural Gas peline Co. of America and Texoma Natural Gas Co., the Comission was permitted free access to the records and accounts of Chicago District Pipeline Co. However, this company did not derstand that it was under investigation or that the information thus obtained would be made the basis of a separate report. Acrdingly, the authority of the Commission was neither questioned Bor waived. The company would have had no objection to the Commission's corporating in its reports on these other companies such of the information obtained from the records of this company as might tave been essential or material to the investigation of the other Companies; but objection is made to the introduction of a separate report on Chicago District Pipeline Co. implying that the Comission has jurisdiction over said company or authority to investirate or report on its business and affairs under the resolution. Does that seem fair, Mr. Walsh? Mr. WALSH. That seems fair. I think it is only fair, however, that I should answer it. Mr. GARRETT. Very well. Mr. WALSH. Mr. Examiner, from our investigation of the Natural Gas Pipeline Co. of America yesterday and our examination of the Texoma Natural Gas Co. this morning, we have seen that practically all of the gas produced by the Texoma Natural Gas Co., and consequently the natural gas transported by the Natural Gas Pipeline Co. of America, was delivered to the Chicago District Pipeline Co. at Joliet, Ill. We are not investigating the Chicago District Pipeline Co. as being connected financially with the Natural Gas Pipeline Co. of America or the Texoma Natural Gas Co., but as a link in the interstate chain of the transportation of natural gas from Texas to Chicago. The Chicago District Pipeline Co. is controlled by companies which are generally known as Insull companies, and we have seen, in examining the intercorporate relations and control of the Natural Gas Pipeline Co. of America and Texoma Natural Gas Co., that the Insull interests were from the beginning participants in the general plan of constructing this pipe line and of acquiring acreage in Texas for the production of gas to be transported through this pipe line solely for the use of the Chicago district. The Commission, therefore, considers that in presenting a report on the Chicago District Pipeline Co. it is merely pursuing its duty under Senate Resolution 83 in showing the ultimate purpose of the purchasers of transporting natural gas from the State of Texas to the city of Chicago, Ill. Examiner ADDISON. Mr. Garrett, the company would come within the language of the resolution beginning in line 9 of page 2 of the resolution, would it not, "nonpublic utility corporations owned or controlled by such holding companies "? Mr. GARRETT. Yes, sir; but there is not any such holding company in this group. So that the premise on which you might investigate a nonpublic utility company does not exist. However, this is a public utility company; so it would be out for that reason. We have carefully examined the entire language of the resolution, and we do not find that the company comes under it, as we interpret it. (There was a discussion off the record.) Mr. GARRETT. Having learned that the report itself was actually offered in evidence and received in evidence yesterday as Commission's exhibit 5607, the Chicago District Pipeline Co. now moves that exhibit 5607 be stricken from the record of this proceeding. Examiner ADDISON. The examiner does not feel certain as to what should be done in the premises, and in that state of doubt he is going to receive the testimony, subject to the objection made. FRANK BUCKINGHAM, recalled as a witness for the Commission, being previously duly sworn testified as follows: Direct examination by Mr. WALSH: Question. Mr. Buckingham, you made an investigation of the Chicago District Pipeline Co.? Answer. Yes, sir. Question. That company, at the time of its organization, was known as the Will Cook Construction Co.? Answer. That is right. Question. When was that company incorporated? Answer. On September 10, 1930. Question. You have prepared a report on the results of your examination of the Chicago District Pipeline Co.? Answer. Yes, sir. Question. That report was introduced into the record on January 24 as Commission's exhibit 5607? Answer. Yes, sir. Question. When was the name of the Will Cook Construction Co. changed to Chicago District Pipeline Co.? Answer. On July 30, 1931. Question. What was the purpose of the organization of this company? Answer. Article 2 of the articles of incorporation of Will Cook Construction Co. sets forth the purposes for which the company was formed, as follows: The object for which it is formed is to build, construct, install, and/or erect buildings, structures, foundations, pavements, sidewalks, pipes, conduits, machinery, appliances, fittings, and other forms of structures and/or mechanisms generally, either for itself or for others, by contract or otherwise, and to do any and all acts reasonably necessary in connection therewith or properly incidental thereto. Question. By whom was Chicago District Pipeline Co. organized? Answer. The company was organized and financed by the Peoples Gas Light & Coke Co., Public Service Co. of Northern Illinois, and Western United Corporation, through Insull, Son & Co., Inc. Question. What was its principal purpose? Answer. The principal purpose was to construct pipe lines for the transmission of natural gas to connect with the gas distribution systems of the Peoples Gas Light & Coke Co., Public Service Co., of Northern Illinois, and Western United Gas & Electric Co., all of which supplied gas to consumers in the Chicago area. Question. Where was Chicago District Pipeline Co. to get the gas which it was to transmit through the systems of the Peoples Gas Light & Coke Co. and the other Chicago distribution companies? Answer. The gas was to be purchased from Natural Gas Pipeline Co. of America at Joliet, Ill. Question. By whom was the Chicago District Pipeline Co. controlled as of June 30, 1930? Answer. Natural Gas Investment Co. Question. By whom or by what corporations is Natural Gas Investment Co. controlled? Answer. By Peoples Gas Subsidiary Corporation, which is a subsidiary of the Peoples Gas Light & Coke Co., which holds 79.54 percent of the outstanding stock; Public Service Co. of Northern Illinois. 14.05 percent, and Western United Corporation, 6.41 percent. Question. Who were directors of Chicago District Pipeline Co. as of June 30, 1933? Answer. The directors were George F. Mitchell, George R. Jones. Morse Dell Plain, J. L. Hecht, F. L. Griffith, Samuel Insull, and H. P. Sedwick. Question. And the officers, as of that same date? Answer. George F. Mitchell, president; W. G. Rudd, vice president; A. L. Tossell, secretary and assistant treasurer; George R. Jones, treasurer; F. L. Griffith, assistant secretary and assistant treasurer; W. R. Weldon, assistant treasurer; Eskil I. Bjork, assistant secretary; and W. A. Sauer, comptroller. Question. Do you know with what other companies George F. Mitchell is connected? Answer. George F. Mitchell is president of the Peoples Gas Light & Coke Co. Question. Do you know with what other companies George R. Jones is connected? Answer. George R. Jones is vice president and treasurer of Public Service Co. of Northern Illinois. Question. Do you know with what other companies Morse DellPlain is connected? Answer. No, sir. Mr. WALSH. The testimony and reports previously introduced into the record under S.Res. 83 shows that Morse DellPlain is an officer of the Midland United Co. By Mr. WALSH: Question. Do you know with what companies other than Chicago District Pipeline Co. J. L. Hecht is connected? Answer. No, sir. Question. Do you know with what other companies F. L. Griffith is connected? Answer. F. L. Griffith is assistant secretary and assistant treasurer of the Peoples Gas Light & Coke Co. Question. Do you know with what other companies Samuel Insull, Jr., was connected as of June 30, 1933? Answer. No, sir. Question. And H. P. Sed wick? Answer. No, sir. Question. At what amount did the plant, property, and equipment account stand as of November 30, 1930? Answer. $130,473.27. Question. And at what did that same account stand as of June 30, 1933? Answer. $3,257,027.82. Question. On page 5 of your report, Commission's exhibit 5607, there is set forth a summary of the plant, property, and equipment account as of June 30, 1933. At what figure is land carried in this account? Answer. $12,022.48. Question. Rights-of-way? Answer. $27,905.91. Question. Transmission-line equipment? Answer. $2,820,107.96. Question. Transmission system measuring station structures? Answer. $26,700.49. Question. Transmission system measuring station equipment? Question. There are numerous other items there, none of which exceed $8,459, with the exception of unfinished construction, in the amount of $239,969.60; is that right? Answer. Yes, sir; that is right. Question. The aggregate of these goes to make up the total of $3,257,027.82 in the plant, property, and equipment account as of June 30, 1933? Answer. Yes, sir. Question. The largest item in the summary which we have just seen is that for transmission-line equipment? Answer. Yes, sir. Question. That amounted to $2,820,107.96. What is the principal item going to make up this amount? Answer. This amount represents the cost of constructing two 24inch pipe lines which connect with the main pipe line of Natural Gas Pipeline Co. of America, at Joliet, Ill. Question. There are two pipe lines running from the Chicago district to the Natural Gas Pipeline Co. of America, at Joliet, III.? Answer. Yes, sir. Question. Will you tell us where each of these lines runs? Answer. One of these lines, known as the Crawford Line, extends a distance of 34.663 miles northeasterly from Joliet to the western limits of Chicago and terminates at the Crawford Avenue production and distribution plant of the Peoples Gas Light and Coke Co. The Crawford Line also supplies natural gas for Western United Gas & Electric Co. The other line, called the Calumet Line, is 41.608 miles in length and extends northeasterly from Joliet to the southern limits of Chicago, and furnishes natural gas for both the Peoples Gas Light & Coke Co. and Public Service Co. of Northern Illinois. Question. Have you the names of the contractors who performed most of the work on the construction of this pipe line? Answer. Yes, sir. Question. What are their names please? Answer. L. E. Myers Co., Paschen Brothers, Inc., and Great Lakes Dredge & Dock Co. Question. The L. E. Myers Co. is a wholly controlled engineering subsidiary of the Middle West Utilities Co.; is it not? Answer. It was. I believe it still is. Question. And the Middle West Utilities Co. is also known as the Insull Co.! Answer. Yes, sir. Question. Had the officials of Chicago District Pipeline Co. anything to say regarding the placing of contracts with the bidders on the job? Answer. Officials of Chicago District Pipeline Co. stated that contracts for construction of the pipe lines were given to the lowest bidders. Question. Also included as part of the costs in building this pipe line were miscellaneous construction expenditures, were there not, Mr. Buckingham? Answer. Yes, sir. Question. They are set forth and discussed beginning at page 7 of your report? Answer. Yes, sir. |