Hondo Anvil Herald (Hondo, Tex.), Vol. 69, No. 34, Ed. 1 Friday, February 11, 1955 Page: 4 of 12
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A AnvN Nereid, Hondo, Toxoi
** Friday, February 11,1955
/f State Wins On All Counts
\
Legal Column Hospital News
Texas REA To Die
Co-Op Attys. Say
nexed this area, part of it mHHg
that the Co-Op had served these
members in good faith when they
1 could not get electricity else-
! where, and granted them a limit-
ed franchise to continue this ser-
vice within the annexed areas on-
ly.
The company made an effort,
unsuccessfully, to block this fran-
chise, and then asked the fed-
eral courts for an injunction to
force the Co-Op to turn over to
them these members and get out
of the art a.
The federal judge, in ruling
against the company, dismissed
the suit on the grounds that no
interest of the company was in-
volved, and that they had no legal
right to an exclusive franchise.
________|___ He said that the acts of the Co-
as cooperative named in the ori- Op were not illegal, and that if
ginal suit. The lift of broad areas they were beyond the powers of
affeeted, as listed in the inter- the Co-Op as granted by state
vention, readies out to include law, the State of Texas would be j time, 18 years ago, these mem-
all the 312,000 rural electric mem-1 the proper one to bring the suit, bers were in fact “receiving” ser-
bers and aU the facilities of the This decision is on appeal by the vice at the time they Were con-
AUSTDMDm and of the rural
electrification movement in Tex-
as will h# tbs result if the state
of Texas sad Southwestern Gas
and Electric Co, wifi on all counts
in their suit against the Upshur
Rural Electric Cooperative, attor-1
neys for the electric cooperatives
predicted hers last week.
Citing in a petition in interven-
tion all the effects which would
grow out of the interpretation giv-
en the law by the state and the
company, they concluded: “Hie
result would be to terminate the
rural electrification movement in
Texas.”
The intervention filed recently
makes the state sssodation of
rural electric systems, Texas
Electric Cooperatives, and 40 in-
dividual co-ops voluntary co-de-
fendants along with the East Tex-
of Texas. This quo warranto peti-
tion contains an interpretation of
the law even more damaging to
the cooperatives than that urged
by the company in the federal
court.
In its ginal suit, the com-
pany sought only to force the
Co-Op out of Gilmer. The present
suit filed tor them by the state,
howeyer, also contends that when
the Co-Op first served these mem-
bers 18 years ago, it did so il-
legally.
This is the interpretation the
state puts oh the provision of the
law that service may be extend-
ed by the cooperatives “to per-
sons in rural areas who are not
receiving central station ser-
vice ...”
The state, in effect, substitutes
the word “available” for the word
receiving. It contends that since
the company had a line some-
where in this general area at the
cooperatives in the state, and
leaves no doubt of the serious-
ness with which all the coopera-
tives view the suit.
The intervention was the latest
action this month In the several
months old battle by the company
to take from the Upshur Co-Op
25 of its members who were serv-
ed in a rural area that has since
been annexed to the City of Gilm-
er. The City of Gilmer is also
a defendant in the case because
of the franchise it granted to the
Co-Op to conligjje serving the
members in Hie annexed area.
Final decision in the case will
not come until April 25, if then.
That is when the conflicting in-
terpretations of the state law un-
der which the electric coopera-
tives are organized will be ar-
gued in court.
Judgment was reserved on an-
other plea by the Co-Op that the
state of Texas should not bring
suit since the acts of the Co-Op
are not detrimental to the public
interest. The attorney general has
not asserted that the continued
service of the Co-Op’s 25 mem-
bers in Gilmer unfavorably af-
fects the public or anyone ex-
cept the commercial power com-
pany.
Probably no other 25 co-op
members ever assumed such im-
portance, being the focal point in
an attack on the rights of all the
electric co-operatives in Texas to
serve practically all their mem-
bers. J
The intervention petition cites
the fact that nearly 15,000 mem-
bers end facilities worth almost
$0 million, statewide, would be
affected now or in the immedi-
ate future, but leaves no doubt
that despite the size of these
figures the biggest concern is that
practically every member and ail |
the facilities of the cooperatives
are jeopardised by the suit.
Since last August, when the
company filed suit against the co-
op and the city in the U. S. Dis-
trict Court at Tyler, and lost, the
legal battle has moved into the
state courts, and has been taken
up by the State of Texas through
the attorney general, on the
grounds that the Co-Op is violat-
ing the terms of the state law
under which it was organized.
The story actually began about
18 years ago, when the Upshur
Co-Op, going about its business
of extending electric service.to
rural members, connected and
turned on electricity for the first
time in 25 homes in a rural area
near Gilmer,
When the City of Gilmer an-
company.
The state law in question in
both suits is the Electric Coopera-
tive Corporation Act, passed by
the legislature in 1937 to permit
the cooperatives to organize in
Texas as a means of bringing
electricity to the rural areas of
the state. At that time, more than
90 percent were without electric
service.
It provides that electric coop-
eratives may be organized to fur-
nish service to people in rural
areas, and defines “rural areas”
as those areas not included with-
in the boundaries of cities of
L,500 population or more. This
clause, however, appears only in
the list of purposes for which the
cooperatives may be organized.
Attorneys for the cooperatives
point out that it does not appear
in the section of the law that
defines the “powers” of the co-
operatives, and therefore does not
limit what they may do in fol-
lowing through with their stated
purpose of extending service in
rural areas on an area coverage
basis.
Another law, passed in 1949,
expressly says that cooperatives
may operate in any city with a
franchise, and for a period of 10
years even without a franchise.
Losing in the federal courts,
the company became "relators”
in a suit filed in the state courts
by Attorney General John Ben
Shepperd in the name of the state
nected by the Co-Op.
If this is, in fact, the law, then
practically every member of ev-
ery cooperative in Texas is be-
ing served illegally. A power com-
pany line down a highway, even
though four or five miles from a
farm connected by a cooperative,
would this have had service
“available.”
Here In HONDO
M&M Bob Kollman returned
Monday night from Sherman af-
ter a weekend visit with Capt.
ind Mrs, Robert B. Moore and
children, Marcia Kay and Sparky.
Vfarcia celebrated her fourth
birthday with a party Jan. 29.
M&M N. P. Pope were in Cor-
pus Jan. 31 and Feb. 1 attending
he bankers convention.
M&M Martin Schneider of Cas-
.roville and M&M Irvin Bendele,
Jerald and Arlene Frances of
Hondo were Sunday dinner guests
if M&M Andry Schneider, Daisy
:ieber, Brenda, Barbara, Rusty
and Tommy Attaway of D’Hanis.
M&M Marvin Schneider of Cas-
troville visited Sunday afternoon
at the Baptist Memorial Hospital
n SA with Mrs. Leon Schneider
ind baby daughter.
SOIL-SAVING FARMERS
GET TAX BREAK
Expenses incurred by farmers
in the prevention of soil erosion
.nave been given favorable tax
treatment under the new 1954 In-
ternal Revenue Code.
Prior to.enactment of this new
provision, the Internal Revenue
Service had attempted, with vary-
ing succeia to require the capital-
ization of expenses incurred in i
contour farming, terracing and I
other soil erosion work. Under
this rule, expenditures could be
deducted over a period of years,
but the courts in some instances
had allowed farmers" tq deduct
these expenses in^the year in-
curred.
l’ne new law permits farmers
to deduct in each year all ex-
penditures incurred in that year
for “soil or water conservation,
in respect of land used in farm-
ing, or for the prevention of er-
osion of land used in farming.
This deduction is limited, how-
ever, to 25 percent of the gross
jicome derived from farming for
the taxable year. Any excess over
and above the 25 percent is de-
ductible in succeeding years, but
in each year the entire deduction
is limited to 25 percent of the
gross income. . ,
This liberalizing provision does
not allow the deduction of ex-
penditures for the purchase, con- \
jtruction, improvement or instal-
lation of depreciable machinery, I
,ile, masonry, metal or wood
structures, appliances, facilities
such as tanks, pipes, reservoirs, I
canals, dams, wells, pumps and Aguera on Feb. 6. 8 lbs. 2 ozs.
conduits. Such expenditures, as
under the prior law, must be ,
capitalized and deducted over the
estimated useful life of the as-
set. . I
Those expenses which hiay be
deducted include the cost of lev-
eling, grading, terracing, contour
'urrowing, construction,' control
fid protection of diversion canals,
irainage ditches, earthen dams,
water works, outlets and ponds,
brush removal and planting of
windbreaks and other treatment
or moving of earth, provided that,
these expenditures are incurred1
for the prevention of erosion of
farm lands.
A farmer may elect to deduct
these expenses incurred in 1954
on his 1954 tax return, or if no
such expenses were incurred in
1954, may make the election on
his tax return for the first year
in which such expenditures are
incurred. However, if the election
is not made at that time, the tax-
payer must obtain the consent of
the commissioner of Internal Rev-
enue before being allowed to ex-
pense these items.
,. Once made, an election is bind-.
ing for all subsequent years, un-
less the taxpayer requests and,
obtains authority to make the
, change.
Admittances:
Mary Joe Howard, appendec-
tomy, Jan. SO.
Mrs. Alfred Breiten, minor sur-
gery, Feb. 2.
Delia Pompa, appendectomy,
Feb. 2.
Felix Ruthowski, appendectomy
Feb. 3.
Luz Valle, appendectomy, Feb.
3.
Armufa Garcia, medical, Feb.
5.
Enemencio Ledesma, surgery,
Feb. 6.
New* babies born at the hos-
pital:
Jose Mario, to M&M Jesus Ma-
rio Sanchez on Feb. 1. 6 lbs. 2
ozs.
Burke Allen, to M&M Lloyd Ed-
win Alford on Feb. 2. 7 lbs. 12
ozs.
Candelario Walters, to M&M
Benito Santillano on Feb. 2. 6
lbs. 6 ozs.
Maria R. Elva, to M&M Frus-
to Saucedo on Feb. 4. 5 lbs. 9
ozs.
Elisa Beth, to M&M Thomas
R. Santos on Feb. 4. 6 lbs. 3
ozs.
Robert Michael, to'M&M Pat-
rick N. O’Neill on Feb. 4. 9 lbs.
Vi OZ. /
Dolores, to M&M Tiodro Lopez
on Feb. 3. 7 lbs, 5 ozs.
Roy Clark, to M&M Roy Clark
Anderson on Feb. 3. 6 lbs. 11 ozs.
Joe Stephen, to M&M Robert
J. Graff. Jr., on Feb. 5. 7 lbs.
9 ozs.
Gerardo Eleazor, to M&M Otto
M&M Leo Laake returned from
Bryan Sunday where they spent
the weekend with their daughter
and her husband, U. and Mrs.
John Smitherman.
Henry Holloway of Dallas was
a weekend visitor in the home
of his parents, the Leslie Hollo-
ways.
Balzen Gare
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McGahey, Fred. Hondo Anvil Herald (Hondo, Tex.), Vol. 69, No. 34, Ed. 1 Friday, February 11, 1955, newspaper, February 11, 1955; Hondo, Texas. (https://texashistory.unt.edu/ark:/67531/metapth810603/m1/4/: accessed July 17, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu.; crediting Hondo Public Library.