The Tayler
Plan

and this may be provided alternatively by renewal of franchise or sale of the property at the expiration of the franchise. The city should have opportunity to make better terms, if it can do so, and this may be provided by reserving to the city the rights to buy the property and to nominate a purchaser therefor. Complete and effective supervision by the city is essential. The sum of it all is in that the community never pays more than cost for the service rendered; that the owners of the property never by any device get more than 6 per cent. on the agreed amount of their investment; and that the community will at all times know just how the property is being operated and have the power to correct any abuse either of management or of service.

The mayor expressed approval of the Tayler plan and with the acquiescence of the city council a committee took up the work of embodying the plan in an ordinance. The members of this committee were Judge Tayler, the Mayor, City Solicitor Baker, John G. White, Esq., of counsel to the railway company, and D. C. Westenhaver, Esq., of counsel to the low-fare companies. The conferences of this committee extended over a period of about sixty days, terminating March 15, 1909. Throughout these conferences the mayor contended for the largest degree of supervision and control by the city. He desired that the lines. be operated by a holding company of the type of the Municipal Traction Company. Meeting determined opposition, he stood fast for a right on the part of the city to name a purchaser at any time after not more than two years from the beginning of the franchise. The committee failed to agree and on March 15th the mayor reported to the council that not one line of an ordinance had been written.

At this time the railway company held sixteen miles of track acquired from the Forest City Railway Company, and the receivers were operating this mileage at three-cent fare, inasmuch as the administration sixty days before had not permitted an increase of fares on these lines. The railway company was occupying some routes, the franchises for which had expired years before. Toward the end of February, 1909, Judge Knappen decided against the railway company in holding as he did that the franchises for the Woodland Avenue and West Side

lines had expired in 1908. Evidently it would be possible to give three-cent franchises to new grantes for routes then occupied by lines, the old franchises for which had expired. If that were done, and the lines operated by the new grantees, three-cent fare would be in effect on about one-third of the street railway mileage of the city system. It was Judge Knappen's decision that opened this prospect, and with this prospect before him the mayor made to the council his report of March 15, 1909.

Councilmanic
Negotiations

In addition to reporting the failure of the committee to agree upon an ordinance, the mayor announced that thenceforth settlement negotiations would be carried on in open council, and he advised that, in case negotiations did not result in a settlement within sixty days, the council be prepared for competitive bidding for franchises on routes where old franchises would soon expire. He is quoted as saying on this occasion-" We never have got in the past, and I don't think we will ever get in the future, any concession or any settlement in the interest of the public that isn't brought about by fear of something worse happening to them if they don't settle." At the same meeting Herman Schmidt applied for franchises on thirteen routes then occupied by railway lines. Obviously, the mayor had arranged to have his bidder ready if no agreement with the railway company was reached within sixty. days. At this meeting Judge Tayler vainly pleaded that the nonvital details which had blocked the settlement be put aside and an early settlement made. Within a few days the city solicitor presented the Baker ordinance as a Tayler plan instrument.

Almost daily for two months the council, in committee of the whole with the mayor as chairman, held open meetings at which the differences between the administration and the railway company were considered. The form of consideration was debate upon provisions of the Baker ordinance. Except for a moment just before the close, these negotiations never gave promise of peace. They merely emphasized the points in controversy, the chief of which were still the character and extent of public supervision, the date after which the city might name a buyer of the property, and the initial and maximum rates of fare.

Within a fortnight of the beginning of the sessions the council

asked Superintendent Bemis of the water-works department to report the value of the street railroad, and he found the stock to represent a value of about five and three-quarters millions instead of about twelve and three-quarters millions, as had been agreed to by the administration at the time of the Goff-Johnson adjustment one year before. While these figures were being made, the council established thirteen street railway routes, looking toward the competitive bidding of which both the mayor and Herman Schmidt had said something in March. The administration treated as accurate the relatively low valuation of the railroad made by the superintendent of water-works. It also proceeded diligently with the project of having bids submitted for franchises, and at just about the expiration of the period assigned for settlement negotiations Herman Schmidt made his bid for a three-cent franchise on Payne Avenue. Thereupon the railway company, doubtless fearing a worse alternative, offered to accept any franchise ordinance drawn by Judge Tayler.

The public utterances of Judge Tayler had made plain his view as to the provisions which should be in a franchise ordinance, and there was no doubt about the essential terms of the settlement which would result if the administration accepted the railway company's proposal. Various public bodies, among them the Cleveland Chamber of Commerce, all the daily newspapers and well-known citizens urged immediate settleSchmidt Grant ment under an ordinance to be drawn by Judge Tayler. These influences had momentary effect upon the council, but the administration adhered to its position that it should not be precommitted to the enactment of an ordinance drawn by Judge Tayler. On June 8th the Payne Avenue franchise was granted to Herman Schmidt, and shortly afterward extension franchises on other routes were given to the same grantee. A petition, originating with the Cleveland Chamber of Commerce, invoked the referendum, and on August 3rd, after an exciting campaign, the people voted down the franchise by a majority of 3,773

Immediately after the defeat of the Schmidt grant, the council voted to renew the peace negotiations broken off in June. This time the altercations of the administration and the railway com

pany were in writing. The series of letters had the effect of pleadings in defining the matters at issue. The Baker ordinance which had been discussed in the spring afforded the startingpoint. A great number of points of objection to the ordinance were quickly disposed of, and at the end of a fortnight there remained in controversy six points which included all those which had divided the parties in their previous Tayler plan negotiations. It should be remembered that the municipal election was. to take place on November 2d, and that the mayor and many councilmen were seeking re-election. It should also be remembered that the election of August 3rd had indicated that the people wanted an early Tayler plan settlement. If no settlement were made by November 2d, it would then go hard with that party to the peace negotiations upon whom lay responsibility for the failure to agree. The letters of both city and railway company showed the effect of these considerations. After the completion of negotiations about sixty days at a minimum would be required for arbitration of values, passage, publication and acceptance of the ordinance, and the popular referendum vote.

Thus, until about September 1st, the apparent policy of the railway company was to agree quickly, but when it was no longer possible to refer the ordinance to the people by November 2d the company's interest only required the actual or potential resolving of the issues while the mayor was yet uncertain of re-election. For the administration it was good politics to have people believe during the campaign that the controversy was virtually ended, and that the mayor was the peacemaker. It was not surprising, therefore, that something like agreement was reached about October Ist. At that date it was too late for a referendum until after the general election. The mayor was in position to say that he had done his part toward peace and the rest lay with Judge Tayler and afterward with the people on referendum day. The other side could say that the referendum was essential to assure settlement and warn people against reelecting the mayor while settlement lacked anything of completeness. Under the agreement reached about October 1st the railway company was to seek readjustment of its contracts with one suburb and with the interurban railways; the invalidity pro

visions were to be drafted by a named commission of lawyers; the city was to be allowed to name a purchaser of the property after eight years and the valuation of the property and the maximum rate of fare were to be found and fixed by Judge Tayler. He promptly accepted the duty offered to him, stipulating, however, that before he took up the case the ordinance must be absolutely complete except for matters left to his determination. In the end he was requested to find the value of the property, fix the maximum rate of fare and draft the section relating to interurban railways. On October 18th Judge Tayler began to hear testimony as to the value of the property.

Evidence is still being offered and it is impossible to say when Judge Tayler will have the ordinance ready for enactment. Since the recent defeat of the mayor and the election of a Republican council, there is no doubt that the ordinance when ready will be passed by the council and thereafter approved by the electors. Most of the provisions of the ordinance have been determined, and a very general summary can be presented here.

Settlement

The ordinance grants to the Cleveland Railway Company a twenty-five-year franchise with rates of fare such as will return. six per cent. and no more on capital represented The Recent by stock, but the rate is limited to a maximum which probably will be four cents cash fare, seven tickets for a quarter and one cent for a transfer without rebate. A maximum allowance in cents per car mile is made for operating expenses. The grantee is permitted to charge the maximum fare whenever the unexpired term of the franchise is less than fifteen years, but the city may terminate this privilege by an ordinance renewing the franchise. If the franchise expires and is not renewed, the new grantee will have the right and the obligation to buy the railroad at a price fixed by arbitration. The city, when it has the power and will-and the city's nominee, after January 19, 1918-may buy the railroad at its book value. plus ten per cent. of the value represented by stock. The grantee's accounts must be in stated form and kept open for examination. The city has entire control of service and may appoint a commissioner to serve at the grantee's cost as the technical advisor of the council. Invalidity of part of the ordinance. does not invalidate the whole. An invalid part will be replaced according to methods described in the ordinance. To end present disputes in and out of court all the companies claiming