Omaha daily bee., 1910-10-28
VALUABLE PROPERTY LEFT OUT
OMAHA PROPERTY CONSIDERED
south Omaha and Gibson Yards Were
Also IncIuded In WARDS Esti-
mate and Omitted by
McVann.

pose prospective freight rate advances at
tackled certain valuations placed on their
propery by railroad Witnesses. when e. J.
McVann, manager OF the traffic bureau s
of the Omaha Commercial club took the
stand before the Interstate Commerce com
mission today.
Witness ruthlessly reduced the valuation
OF 100000 placed on the Burlington roads
terminal property by General Manager
Ward OF the railroad AT Omaha. The as
scssed valuation OF the terminals, witness
stated was f83l.9O5.
This" continued Mr., McVann lis about
% per cent less than the actual value,
which makes the latter about 8L0OOOO. [
found that the railroads in Omaha paid
about 10 per cent more than the actual
value Of the land so that Mr.. Wards es- 4
innate would have to be cut in two to
give the correct value OF the terminal
lands"
The witness declared that similar condi-
tions obtain at ST. Paul, Minneapolis and
Duluth The roads at those points he
said have paid more than the actual value
for their terminal lands.
Before he was excused from the witness .
stand, Mcvann, on cross-examination .
said that his figures Of sSsl 2O6 as the as
scssed valuation OF the Burlington termi- /
mails in Omaha did not include the South ,
omaha nor the Gibson yards of the rail- /
road nor the right of way through the |
city all OF which Attorney Dawson as
serted we're included in the 49, 100000 esti- !
mate OF reproduction value given by F. Il. |
Ward, general manager Of the Burlington |
with which Mr.. McVann had compared his {
estimate
OperstIng Expenses Jump.
Mr. McVann centered his testimony on
the Burlington, the Santa Fe. the Chicago
a Northwestern and the Chicago, Mil
waukee & 81. Paul railroads, which, he
said were the governing factors In west
crn railway affairs.
In examining the operating expenses OF
these four roads" said the Omaha traffic
expert, Il found there has been an unpre-
cedented jump In operating expenses in
1910. ] say unprecedented because none OF
the railroad witnesses would say that the
Increase was normal"
From examination OF railroad reports to
the Interstate Commerce commission. wit
ness found that the Santa Fe maintenance
account Increased 25 per cent in 1910 over
1902. and its transportation account ad-
vanced 20 per cent during the same period
The maintenance account OF the North
western road Increased 22Ik per cent
and the transportation account as per
cent in 1910, as compared with the preceding
year. The Burlingtons maintenance ac-
count increased 1876 per cent and the trans
portRtion account n per cent
MIR, McNann said that the increa sed busl-
ness normally would show an increase In
operating expenses before an advance I'm
maintenance expenditures He made this
statement in contrast to the fact that the
Santa Fe's maintenance account increased
more thaa its transportation account in
loOe-lgic That might be explained. he said,
10y the purchase OF construction material
Cor future use.
After discussing the items Of gross profit.
the percentage OF empty cars hauled by
he roads and the Increase In the minimum
carload weight. Mr. McVann gave his opin-
on OF the proposed increased freight rates
1T is my honest opinion" he said that
the increases will not add to the revenue
~ the railroads, hut will decrease their
revenue by Its effect on business in
stoppcTe OF the movement OF goods"
Much time was spent by Attorney John
H. Atwood counsel for the shippers in dis
oussing the comparative increases IN the
maintenance OF way and the cost OF trans
portetion accounts.
Present Conditions Abnormal.
II do not think said the witness. that
freight rates for the future should he
based on the showing Of q year such as
creased expenses"
Mr. Movann testified that IN 1910 on A
gross transportation Income Of s74OOOOOO
The Northwestern road received gross
profit OF S27 per cent; that the Santa Fe
on gross transportation Income Of sos
cocoa received s66 per cent gross profit.
aud the Burlington. on a gross transporta-
ton income OF SSS,OOOOOO received a gross
profit Of s2s per cent.
The items OF taxes, depreciation and
debt the witness said. were not included
IN the computation
DO you mean that any business house
would figure gross profit without de-
ducting taxes" asked Attorney Chester
Dawes OF the Burlington.
To arrive at a gross profit il would
answered Mr. McVann, "but , expressly
said that the taxes and other items ver.
eliminated from any computation Of sros,
transportation income and operating OK
psnscs.
The witness declared that the perceutag
% empty cars hauled by the Burlngtol
decreased In 1910 from the percentsge han
lied In lsle
a. y. White Of Neyads la a membe
~ the Corn Belt Meat Producers associa
uon and one OF the witnesses for the ship
pers in the movement against permitting
the proposed freight rate Increase 20 be
come permanent testified today before tn
Interstate Commerce commission In IN
rate hearing. lie asserted that he had eK
smiusd the statistics presented by the rail
roads and said
II saw there a tendency 20 increase o
pad statements Of operating expenses ou
~ an proportion. DO not mean that an
dishonesty was used, but the msinteuanc
charges have been increased and show
e0rTespOnding decrease In revenue