The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1897-07-01
POLITE BUT FIRM.
The Mo. Pacific and the Santa Fe De-
cline to Lower Their Rates.

Responding to the recent demand of
the state board of railroad commission
ers for a reduction of 20 per cent on
distance tariffs. 20 per cent in existing
coal rates, 5 per cent on grain and
produce rates and 5 per cent on Ive
stock rates. the Missouri Pacific, by
Vice President C. G. Warner of st.
Louis. and the Santa Fe by E. P. Rip
lev. have notified the commissioners
that the roads which they represent
will be unable to yield to the request.
The answer from the Missouri Pacific
was received today. Mr.. Warner says:
The Missouri Pacific cannot, under
existing conditions. yield to your re-
quest for a reduction of rates If the
operation of our properties in Kansas
enabled US under existing circum-
stances to pay a dividend, however
small. to our stockholders, we might
feel disposed to concede something
Substantial from net revenue But in
asmuch as these properties do not pay
and have not paid any dividends
whatever to stockholders and are not
sufficient in the aggregate to pay op-
Grating expenses, taxes and fixed
charges to make a reduction of present
rates would simply result in increasing
our annual deficit in the operation of
Kansas lines, which would ultimately
involve them in financial ruin. The
aggregate amount earned on our Kan
sas lines is insufficient to prevent an
annual deficit. Surely no fair-minded
man under these circumstances would
insist upon the reductions proposed"
Mr. Warner refers to the Iowa prop
osition and admits that the rates there
are lower than in Kansas, but says:
Iowa is more densely populated than
Kansas and affords it's railroads much
larger and more varied traffic. More
than one-third of the state of Kansas
is substantially unproductive and af-
fords but little business to the rail-
roads. Many of the lines of the Mis-
souri, Pacific are located in the un-
productive portions of the state. Iowa,
Mr.. Warner says the railroads in Kan
sas also pay a higher rate of taxes than
they do in Iowa.
Continuing, Mr.. Warner uphoIds Mr.
Ripley's theory that the consumer Sc
cures the benefit of lower rates. He
says: Railroads cannot be operated
unless they are permitted to earn
enough to pay operating expenses" He
might compel the companies to aban-
don the lines already constructed or re-
sort to inefficient and unsatisfactory
service.
gross earnings per mile are 81. .230, while
in Kansas they are only $3,0S3. The
net earnings per mile in Iowa are 81. .222,
while in Kansas they are only $697. In
Iowa the taxes on the net earning ca
pacity of the road are IL per cent, while
in Kansas they are 81 per cent.
After paying taxes the net earnings
of every mile of road in Iowa are 81 ,069,
and in Kansas, S430. In Kansas the net
earnings will not exceed per cent on a
mile of road assessed at $7,300.''
If Kansas were as reasonable in the
assessment of railroad property as Iowa
is, President Ripley asserts, then the
roads could perhaps come to the rates
demanded by the board.
If there is an overcharge on rates
which he denies, he poiRts out how such
overcharge is returned to the people of
the state in the shape of excessive taxa
ton collected from the roads and re-
turned to the people.
MI R1pley's reply closes by saying
that reduction in the rate on corn
does not result in any benefit to the
producer, and calls the boards atten-
ton to the grain rate war of 1896 and
the corresponding fiuctuation of prices
''On July II. 1885, he says, "Septem-
Der corn was selling in Chicago for 2S1k
cents A reduction of cents a hundred
on freight rates was made, and on July
Is September corn had dropped to "a
cents. On August 26 a further reduc-
ton of cents was made in the freight
rates. and corn, in sympathy. dropped
to 20 cents"
TIE Rock Island and Union Pacific
have not replied to the demands made
bv the commissioners.