New-York tribune., 1907-08-27
AGAINST LOWER RATES..
Controller of Southern Rail7oay
Heard on North Carolina.

xrosb,np+o, Aug as-The hearing of the North
Carolina rate case before Walter Moh'8oineiS'
master in chancery, was resumed at the SoulheiA
Railway offices to-day. Controller J. H Plant OF
.he Southern Railway occupied the witness stand
throughout the day. The testimony was q maze
OF statistics bearing the various phases vi 'ii0
cost of operation and earnings Of the road 1t
dealt mainly with the higher cost of operation III
North Carolina than in other states
Mr.. Plant stated that the total cost OF operating
fntrastate passenger traffic for the year ended
Juno 90 1906 was s242s,4l5. and the total earnings
In North Carolina a,SI10SS. net loss OF
about s45sooo. The average passenger trafno Iese-
nue. a train mile, he said, was IS cents, while the
earnings including state and interstate ana fnaii
or express. 81 81 a mile
what was the minimum cost of earning dollar
in North Carolina intrastate passenger traffic!
he was asked
.The minimum cost of operatfon in earning one
dollar on intrastate traffic was 1896" he replied
That represents the cost of earning one doIIaT
on intrastate business In North Carolina for the
fiscal year 1906 exclusive OF taxes or oetleFineHts
interest investment"
Mr. Plant said thar, far he had been aoIe
10 determine by careful examination, the cost or
operation had been greater thus far in 1907 than
in 1906 in both freight and passenger business
My investigation" said he. demonstrates that
TO 81 Of local revenue in the State OF North
Carolina Is twice IS expensive II IS to earn 81
interstate business. The figures / use are Oh
minimum expenses, and low minimum at that
The average cost Of handling ton mile In North
Carolina IS less than three times as great as
il is the system generally
In response to an inquiry by General Counsel
Thom of the Southern Railway, Mr.. Plant stated
that the tax valuation of the Southern Railway
property in North Carolina for 1906 was s26.l34S6o
HAS there been a recent increase in that assess
ment?" he was asked.
II have been told So" he replied; ut is now
s33. .S62 a6S''
The witness discussed the proportion of tne net
earnings of the road the assessed valuation, in
dicating that under the present earnings the tax
valuation ought not to exceed S9345,9S5 He said
that the gross revenues intrastate traffic in
North Carolina for 1906 were S3,324,625.
Mr. Plant explained that during the year ended
June So 1906, SSoi $50 charged to capital ac-
count in North Carolina for improvements and
equipment, while the whole system the amount
charged to the same account was s2S7019o- He
said that the expense during the year OF keeping
the property up modern standards in North
Carolina s197.945 This amount. added to the
state of s269 651. aggregated total sum not
capitalized of s467,59s The total net earnings IN
North Carolina for 1896 1924 754.
Mr. Plant testified that If the proposed rates
were put into effect on the basis of the business
of 1906 the total net returns from intrastate bus-
ness in that state would amount to only sS.N3
not allowing anything for the payment Of inter
est or dividends. The earnings. he said. would De
only 59-loo OF l per cent. while the earnings IN
1856 on the old rates amounted to a1a per cent
During the last nine months. Mr.. Plant indicated.
the operating expenses OF the system had IN
creased to such an extent that the expense Of
earning dollar In North Carolina now was 1888
cents
Under the old rates. he explained, the road would
have S1707oS remaining It's intra-state trafIlc
Under the new rates and conditions the minimum
reduction of revenue the road would be $3.50
without computing any interest. or dividends OF