The Vinita daily chieftain. [volume] (Vinita, Indian Territory [Okla.]) 1902-1913, 1909-11-24
COMMISSION IS HEARING
EVIDENCE IN RATE CASES

Guthrie, Okla, Noy a. = The cor
poration commission convened yester
day in special session with Chairman
Love presiding and Commissioners
Watson and McAlester sitting to take
additional evidence in the ten freight
orders issued by the commission
which have been in effect the past
year and which the railroads now
claim are confiscatory.
An imposing array of legal talent
including the general attorneys and
their assistants and the Oklahoma at
torneys OF the majority Of the roads
are III attendance at the hearing, as
well as the auditors and experts Of
the supreme court referring the cases
back for further evidence and find
ings Of fact, Chairman Love stated
that the Oklahoma rate hearing must
be based upon the actual Oklahoma
conditions and that no technical
testimony BY experts would be per-
mitted to fill UP the record
Coal Tariff Order First,
He directed that the coal tariff
order, which was the FIRST order put
into effect, should be considered first,
and as the Rock Island road Is more
affected by this order than other roads
its representatives were called upon
10 proceed e. l.. Lindley, general
attorney for the Rock Island, CON
Quoted the examination OF Witnesses
for the Rock Island and Assistant At
torney General G A. Henshaw repre-
sented the state.
Frank Nay, general auditor of the
Rock island was the only witness
examined during the morning session
He introduced vast amount of tech
nical testimony as to the earnings and
expense OF operation of the reads
business, both interstate and intra-
state, based upon arbitrary formulas
These figures, II developed, were only
estimates and were not based upon
the actual conditions, and were made
up by pro-rating the cost Of operations
based upon the formula prepared
which he Afterwards admitted upon
crossexamination were The forms uaad
by the railroads IN the Missouri and
Arkansas rate cases,
Formula Suggested by Judge.
Mr.. Hay also admitted he DID not
know why he used this formula, ex-
cept that Federal Judge yandayenter
had suggested that the form he used
and that other experts and accounts
had advised its use to get the same
results as by definitely checking up
the actual cost OF operation as be.
tween interstate and intrastate busi-
ness. According to the formula the
witness introduced an array Of figures
showing that during the six months
Of this year ending June 80, 1909 the
total freight business in the state only
brought a return of asSR per cent and
the passenger business .s7 per cent
According to his figures that the inter.
state freight business showed a de
ncit of $73,03240 during that time
while the Interstate passenger bust
ness showed a net profit Of over
$4,000 According to his formula the
roailroad charged so per cent more
for operation Of local or state business
than for the Interstate business. Just
why, the Witness could not explain.
except that It was done in the Mis-
souri and Arkansas rates cases. lie
stated the railroad also charged % per
cent more to expense for state passen
ger service than for interstate bust
ness for the same reason as in freight
business.
Henshsw cross-Examines.
Assistant Attorney General Hen
shaw showed on oross-examination
that Auditor Nay had prepared his
statements at the suggestion OF the
legal department OF the road for this
rate hearing aud had been directed tc
follow out the form used in the Other
rate cases. AIr. Henshaw also Sc
cured an admission from the witness
that he could have made his report
cover at least eight months OF the
current year upon such formula Mr.
Henshaw declared the reason that the
railroad company did not carry its re-
port up to date was because that even
under its own formula it would not
be able to make a showing in court
and that the railroad therefore took
the first six months. OF that portion
of the year when the expense is great
est and traffic lightest
OF the capital stock and bonded in-
debtedness Of the road S4s.o75.e13.Ss
is charged to Oklahoma, Of which
$685. ,919.12 is capital stock.