Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1908-05-19
Railroad Commissions Of Every
State Admit Need of Fixed
Standard
EXPERTS TO FIGURE OUT COST
Few Know Exact Expense EntaiIed in
Handling Freight - STANDARD Oil
Company Of Iowa" Makes Mysterious
Move - Iowa Company Does No
Bushes. in State.
Special to Times Republican.

Special to TimeS-RepuDllcan.
Des Moines, May 19.-The commit
tee on statistics of the national asso-
citation of railroad commissioners and
a score or more GE railroad accountant
EXPERTS will meet in Chicago June
to make second attempt to arrive at
some satisfactory solution of the prob
lem Of fixing a basis on which to NIX
rates. 1t is due to Dwight N. Lewis,
Of the Iowa railroad commission that
the same body of people did not solve
the question a year ago by computing
the earnings and expenses only to the
state line and saddling all the ex-
pense of operating road upon the
business done strictly inside the state
lines without giving any credit what
ever to interstate business.
Every railroad commission in the
nation feels the need Of a solution to
the vexed problem Of finding out what
it actually costs to handle freight. II
a railroad commission could determine
the exact cost of handling freight 1t
could very easily fix the rate to be
charged at figure that would give the
road a fair profit. Freight rates would
be as simple as slicing cheese II some
means could be found of ascertainmg
the cost Of handling the business. NO
one has yet discovered satisfactory
solution.
nf nYnorfS IN
Chicago year ago this matter was
discussed and the experts solved It
very simply so that the figures would
look well in columns of figures but got
no farther than that.
freight train carrying lot or
freight has in every instance packages
to be carried from one point to another
inside the state; also packages to be
carried from point inside the state
to a point outside; also packages being
carried thru the state having come
from an outside point and to be car
ried to an outside point; and also
packages being carried from an out
side point to an inside point. The ex-
perts in Chicago a year ago decided
to disregard all interstate business and
taking the freight handled by a road
during year would saddle all the ex-
pense of the roads upon that business
and thus determine the cost.
Mr.. Lewis, who as secretary, repre-
sented the Iowa commission, objected
and pointed out that while state
commission could not regulate inter-
state business it was bound to take
into consideration that state business
was not all the business railroad
handled when rates are to be fixed. AS
result the matter was put ever for
another year for further discussion
Three different suggestions have now
been made and these will be discussed
at the coming meeting Of the experts
in Chicago. These are:
First: Separation to be made adopt
ing the theory of constructive mileage,
l. e., giving to each state a greater or
less proportion of the freight earn
ings of the entire line from interstate
shipments thar a straight mileage pro
rata, taking into account the density
of traffic, the cost of transportation
and original cost of construction.
Second. Eliminate outside opera
tions as before and after formulating
satisfactory rules for separating ex-
penses by state lines, which presents
no serious difficulty, allocate to each
state a share of the earnings Of the
entire line based upon the proportion
of expenses occurring in each state.
Third Again eliminating outside
operations, separate the earnings by
states pro rata. per mile, of each in
terstate shipment based upon the local
rates of EACH state applicable to the
movement in the particular state thru
which the traffic passes.
1t is believed by many railway rate
experts that in any- event the cost Of
railway freight transportation can
never be gotten at except proximately.
because of the Interstate business. For
instance much of the expense in oper-
ating the big terminal plants such as;
at Chicago and elsewhere belongs to
Iowa. The railroads must maintain
these terminals Illinois originates
more freight business than Iowa be-
cause it has more manufactures and
because of the big terminals at Chi
cago. The cost of operating the rail-
roads in Illinois is greater per mile
than in Iowa and the cost of operating
the railroads in Iowa is greater than
in Nebraska for the same reason. The
density of population which is the
reason for the density of traffic is to
be figured in and accounted for. And
again by what proportion is the ex-
pense greater to handle freight for e.
short distance than for a long dis
tance.
The Standard Oil Company amended
it's articles of incorporation on file with
the secretary of state so as to reduce
the capitalization from s1.OOO,O0O to
$1,000. This is the STANDARD Oil Com
pany of Iowa" The company has
never done any business in Iowa and
illustrates one of the means by which
big corporations dodge the laws which