The Montgomery advertiser., 1909-06-06
The Seaboard Has Gone Into The
Hands of a Receiver.

! ACCSkUeFe
Alabama Railroad and the Western of
Alabama and Central OF Georgia. com
tinued to operate under the old rates.
The Southern Railway was the frst.
ana one Of the largest and strongest
OF the roads to put the rates into ef-
feet. A study Of the ngutes dealing
with the operation and business Of the
Southern should carry special sig
nificance on the actual results OF the
new rates
The southern escaped bankruptcy.
For some months II was, predicted that
the road would Inevitably 20 into the
hands Of receiver. hut heroic meas
ures saved it. and that by the narrow
est margin. A leading railroad ON
cia1 declared:
III the Southern depended upon its
Alabama business, IL Its business In
other states were done under the same
rates and the same conditions as in
Alahama. the road would have been
Bankrupt"
As Il ID. the ROAD does business At 8
loss, and q deflcit is an annual embar-
rassment under conditions that now
exist In AIabafnas and railroad men fa-
miliar with these conditions and with
the reports Of the Southern, agree that
Il surely would have been forced into
bankruptcy IL its business In Alabama
alone had to be considered as q basis
for the year ending June 80. 1893. The
swern reports Of the ofiicers of this
road show that the ratio OF operating
expenses to operating revenue was
$3.50 per cent. This means that In the
State Of Alabama for the last fiscal
year, the actual operating expenses 10
earn 500 OF revenue were ssssa. ana
that only s1.41 remains with which to
pay taxes. meet hxed charges and af-
ford q dividend. As this si.41 out Of
each 800 of gross earned revenue rep
resented the net operating revenue In
the State OF Alabama, which totalied
sT7.ss0. and as the taxes OF the South
erh Railway In Alabama amounted 70
$2e6.96s, It can be readily Understood
that not only could no dividends be al
lowed. but that no fixed charges could
be met and that taxes on the property
could not even be paid out Of the net
revenue.
one Pregnant Fact.
This enc fact should be clearly and
Of the Southern Railway In Alabama
Is s77.s2o. The road pays taxes In the
State to the amount Of s2ss.sss.. When
this fact IL fully grasped. the menace
OF bankruptcy 10 apparent; but these
are the sworn figures Of the officials of
the road and the statements and tabu-
lations were made according to the
system Of bookkeeping devised by the
Interstate Commerce Commission, and
endorsed by the present State admin
istration of Alabama,
The worst menace to the welfare of
the Southern is contained In the de-
pressing figures In refernce to its
freight business. In 1905, the freight
earnings OF the Southern were ss,S4s
per mile. In 1905 1t had Increased TO
$40e4.44. The following year the re-
port covering until June 80, 1907, the
Southern reached tine high water mark
Of its net earnings when II reported
that its freight servings per mile were
S4s14.s In 1908, the freight earnings
dropped to es.s4s, the low water mark
OF the four years covered by the In
vestigation.
The line which shows the net In
come OF the road per mile. however, II
the item which showss. the danger the
road has undergone and which stti
threatens It. The nee income from OPP
cations amounts tor only SIS d mile
1 Thia WILL neff paH the taxes ~om s.the
Iroad, as YVES showps shove. When
taxes are paid the road faced, a con
siderable defcit. with nothing to APP
pFoprtats for The payment of the inter-
Expense cutting was not suffieisnt "a
save the Eeaboard AIR Line, although
| the otfieials Of that tine were az des-
psrate In economical measures as the
ohiciale OF the Southern or any other
road. The Seaboard. year ago, went
into the hands OF receiver. Before
this action was taken, hundreds Of its
employees were necessarily discharged
| Montgomery, Birmingham and other
| cities were forced to see the unpieas-
| ant and deplorahls spectacle of honest
and industrious, employees with years
| Of service to their credit. stand idle on
the streets with their hands in their
| pockets--without work and without
| resources. Rents went unpaid, grocery
bills were not paid and In too many
| instances. there was actual want and
suffering in homes where Industrious
| husbands and fathers had always well
provided before political agitation had
| done it's work.
The report Of the Seaboard Air Line
| for the year ending June 30, 1908
| shows that its ratio OF operating ex-
| penses to operating revenue In the
| State of Alabama, was 1o7.S4 per cent
| or. in 'other words, that in order to
| handle the trafic necessary to produce
| 800 of revenue, the Seaboard Air Line
| had to expend for operating expenses
S10I34, losing s7.s4 in each 400 worth
| of trafic conducted by 1t In this State.
| What else could have been expected
| but q receivership? And in addition tc
this. the road had heavy taxes on rea,
and intangible property in Alabama.
The net operating revenue for the
| seaboard for 1907 was sa1,033. Even
with this, the hxed charges would have
| wiped out this small surplus from thu
| years business, but this surplus was
succeeded in 1908 by a dencit Of
sso,ls4.
A Radical Change.
| When this change OF over Sal. 0et
/ from a net operating surplus to a net
| operating defeit is considered. and
| when It Is understood that In addition
! to the net operating dehcit Of ovel
$4,000, the Seaboard Air Line was bur.
dened with taxes of over $4,000 In the
State, the receivership Of this road
after It's surrender and it's Acceptance OF
| the terms Of the legislative or COM
| mission tariffs Is not surprising.
For every mile Of the Seaboa-d OPP
| Grated within the state 81 Alabama
for the fiscal year ending June 80. 1908
the road lost s247 This was the dif.
ference between the operating ex-
| penses and the operating revenue In
addition TO this loss Of $2AT mile, the
! road was compelled to pay taxes and
was compelled. also, In some way, to
make provisions for the payment Of
| the interest on It's bonds. The reeeiv.
| ership, as matter Of course, overlook
! It. 1t was inevitable.