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History

Over one-hundred years ago, the building and operating of railroads was one of America's fastest growing, most competitive and most profitable industries. Railroad tracks had crossed the Rockies and spanned the continent, and the nation's most powerful industrial barons --Vanderbilt, Carnegie, Morgan, Gould and Rockefeller had gathered extensive railroad holdings as part of their financial empires. They battled each other aggressively, and sometimes unscrupulously, for control of the nation's rail routes, and the lucrative freight and passenger traffic they carried. In Colorado, the competition for rai1road supremacy flared into a genuine battle in the late 1870s, between General William Palmer's Denver and Rio Grande Western and William B. Strong's Atchison, Topeka and Santa Fe. The two companies staged a neck-and-neck race to build the first tracks south from Colorado across Raton Pass. The Santa Fe won that one, but a similar race began the next year to lay rails from Canon City to the silver mines at Leadville, through the Royal Gorge and the Arkansas River canyon. That contest led to sabotage by the two railroad's work crews of each other's construction, and eventually wound up in court. The Rio Grande stockholders sought to end the warfare between the two companies, and forced General Palmer to lease the Leadville route to the Santa Fe. Palmer remained unhappy with that agreement, and went to court to get back the Leadville right-of-way. Having obtained a court order that accomplished this, he wanted his Leadville route back immediately and sent men to forcibly take possession of it, all the way from Leadville to Pueblo.

The Santa Fe's William Strong would not give up without one last fight. He hired the legendary Dodge City lawman, Bat Masterson, to bring in some Kansas gunmen to square off against Palmer's men at the roundhouse in Pueblo. The standoff ended without bloodshed, and the Rio Grande-Santa Fe contest finally ended in 1880, when Jay Gould, who then controlled the Union Pacific acted as mediator, arriving at a settlement, which gave the Leadville right-of-way back to the Rio Grande.

In the halls of Congress and state legislatures the tactics of the nation's railroad barons, were condemned by their critics during the 1870s and 1880s. The railroad tycoons were accused of giving rate rebates to favored shippers and gouging others, of bribing lawmakers and trying to ruin their competitors. In the early 1880s, there was considerable support in Washington and in a number of state capitols for legal controls on the railroads' operations, and for regulating the rates they charged to haul commodities and people.

The Colorado Legislature moved to establish such regulation in 1885, by creating the office of Railroad Commissioner. A 1919 document published by the PUC (which came into existence in 1913), says, 'The powers of the Railroad Commissioner were restricted in that, while he had the authority to investigate rates and charges, he could only determine and recommend reasonable and just rates, He was clothed with no power to compel obedience with orders."

Cynics of the time said that the legislators had thus acknowledged the public demand for some kind of government regulation of the railroads, but had not gone so far as to offend their railroad friends by giving teeth to that regulation. In fact, the Legislature allowed the office of Railroad Commissioner to die a natural death by failing to fund it in the next few years, and the office was abolished in 1893. In the words of the 1919 document, the office "had previously become a nullity through lack of appropriations."

The Legislature tried again in 1907, creating a three-member Railroad Commission. This act was challenged by the railroads on constitutional grounds and was tied up in court for the next two years. The Legislature made yet another try, eliminating the contested features of the 1907 act, and the Railroad Commission finally became a reality in 1910, this time with the power to function as a true rate regulating body. The Commission was empowered to set rates and also to seek prosecution and fines for violations of rules or the charging of excessive or discriminatory rates.

The types of services we call "public utilities" have existed in Colorado for over a century. In 1885, there were electric streetlights in central Denver, and a telephone line from Denver to Pueblo. The Colorado Legislature did not officially define such services as public utilities and bring them under state regulation until 1913 when it created the Public Utilities Commission. The 1913 act was controversial and an attempt was made to refer it to a vote of the people, but the petitions were declared to have fraudulent signatures. The first PUC embarked on its duties, with three members appointed by the Governor, in 1914.

The PUC absorbed the function of the Railroad Commission to set rates for the state's "common carriers". In 1915, the definition of "common carrier" was amended to include trucks and automobiles used for transportation of freight and passengers. Many different types of transportation businesses have come and gone under the PUC's regulation during the past 100 years. Now-extinct forms of transportation such as "street railways" (electrical1y-operated streetcars) and "interurban railways" (streetcars that ran between towns) were once under PUC regulations. Various types of trucking businesses have been regulated, deregulated, and in some cases regulated again, over the years. Air carriers came under state regulation in 1969, and were deregulated by Federal legislation in 1978. The regulation of the so-called "fixed utilities"--electric, gas, water and telecommunications companies--has seen some ebb and flow over the decades. Colorado's rural electric cooperatives went to the Legislature to seek PUC regulation in 1961, and then sought an end to that regulation in 1983. They were successful both times. The 1983 deregulation procedure required a vote of each co-op's membership, and most of the state's co-ops have voted to become deregulated. 1983 legislation also ended the Commission's jurisdiction over municipal utilities, whereas the PUC previously regulated their services when provided to customers outside city limits. The status of the post-divestiture telephone industry requires the PUC to bring under its regulation some of the new long distance telephone companies operating in Colorado. Today, the Commission has at least some degree of jurisdiction over hundreds of fixed utilities and more than 10,000 motor carriers.

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1560 Broadway, Suite 250, Denver, CO 80202
(303) 894-2000 - Phone (800) 888-0170 - Permits and Insurance (800) 456-0858 - Consumer Assistance (303) 894-2065 - Fax