The Kimball graphic. (Kimball, Brule County, Dakota [S.D.]) 1883-1905, 1897-02-13
Railroads and rne,r EARNINGS.


The manner in which the states
finances are dependent upon the sue
cess of the railroads is shown on a COM
parison Of the states revenues for the
past few years from that source. IN
der the law which requires the railroads
to pay into the tate treasury four per
cent of their gross earnings. in lieu OF
all other taxes. the state virtually be.
comes a partaer in tina railroad bust
ness without assuming any bother of
their management or any, OF the liabll-
tiles Tor their operation. As the governor
we'll says i'll his message, this is a very
simple arrangement. but it is an ar
rangement Whereby 1T becomes thestate's
interest to make the gross earnings OF
the railroads as large as possible. OF
course the four per cent tax must come
from the people through their patronage
of the railroads, but coming so indirect
ly. the people do not realize that it is a
tax upon themselves. Moreover IS 1t
comes mostly from those who can afford
to travel and pay railroad fare, and those
who pay railroad freights it touches
principally the well-to-do and %relie,es to
that extent the poorer classes. The
amount of taxes received from the rail-
roads for the fiscal year ending Dec. 30,
1896, was S~l,172,T92. This was moro
than one-half Of the states total expend-
Ifnras fpr thu y.npru (,annr.Ily es,nai,irx
the taxes from railroads, telegraph aud
telephone companies aud sleeping car
companies have usually furnished
enough revenue to meet the ordinary
expenses of the state government. The
receipts from these sources have Ilaiur-
ally decreased considerably during the
past three years owing to the depression
OF the times and the falling off OF the
gross receipts of these corporations. For
the fiscal year OF 1894 the taxes from the
railroads amounted to $1.43S, 1853, or
about S2b6,OUb more than for the past
fiscal year. The state OF Illinois derives
its entire revenue from tins source, and
it is a very large one. The interest which
that state has in keeping up the gross
receipts of railroads is shown in a recent
report of the railroad commissioners Of
that state in reply to a resolution of the
state grange asking the commissioners
to reduce the passenger rates in that
state to two cents a mile. 1t transpires
from the reports of the roads in that
state, that although the roads have a
legal right to charge as high as three
cents q mile, the communication rates, ex-
cursiOn rates aud reduced rates for spec.
flied occasions reduced the actual fares
paid in that state during The past year
to "a cents per mile which was only a
quarter Of a cent higher than the state
grange demanded should he established
by law. 1t their reply IL ,ilis demand of
the grangers the commissioners say that
this is a bad time to ask them to enforce
lower passenger rates upon the railroads,
when most of the roads are having a
hard struggle to keep out OF receivers
hands. Tie reduction, the commission
ers say. might be borne 10y some of the
stronger trunk lines. but 1t would be a
great hardship on the smaller ones and
branch lines that have paid no dividends
to stockholders, and can with difficulty
pay interest on their bonds, because Of
the decrease Of travel add business. The
commissioners say any reduction in the
rates Of many Of the roads would bring
disaster to them without good to the pub
lie. 1t appears from the railroad reports
of Illinois that only 16 OF the 40 roads
operating in that state paid any divi-
dends on their stock and that as q whole
there was a deficit of nearly eight million
dollars in their business in the state.
Receipts of passenger departments fell
off 2456 per cent. In the whole United
States for the year ending June 80. 1895,
there was a total loss in the operation Of
railroads amounting to $29,S45,24l. That
is, receipts were that much less than
operating expenses. Seventy-ive per
cent of all the roads in the United States
failed to pay any dividends at all, and
there wa a default in the payment Of
interest on II per cent Of outstanding
bonds. So it does not look as though
the railroads were doing any better, or
even as well, as other branches OF bust
ness. And it does not seem US though
this was a proper time to jump on the
railroads, when so many Of them are IN
receivers hands and are having a hard
struggle 10 keep up their accemmoda-
tions to the public.-Oskosh wis.
Northwestern.