The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1910-12-30
Santa Fe Shows Why
Rates Should BE Raised

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The OAook oil December says that it oregone
cluson that every railroad than merely fair
dividends its common stock 1t is necessary to
large surplus III order to have sufficient credit raise
nous sums required to develop the property in accordance
with the demand and requirements of the public. This ei-
ora based article written by Walker D. Hines,
chairman OF the Executive Committee Of the Atchison, To-
peka and Santa Fe Railway Mr. Hines in his article said
The interest in the question Of advanced railroad
tends far beyond the shippers and the railroad rates them
selves to the interest OF railway labor investors railway
securities producers OF railway supplies and materials those
concerned in the opening up of the ndeveoped regions OF
this country and above ALL the interest of all the people
in the extension of railway transportation increased
venences efficiency and safety of that transportation
ivitally involved.
The Santa Fe has spent 200 million in improvements
its property in the past fourteen and half in addition
to heavy operating expenses and for increased mileage four
million five hundred thousand dollars have been spent each
except the past when So000O 600 expended IN
this one department.
In the opinion of the officers of the company these
pendtures will continue average from twenty million to
twenty-five millions year. and perhaps to meet every
increasing requirement. for additional and improved equip
|ments and Improvements the existing lines.
In addition there should be from five to ten million
year for the construction of mileage All such expen
dtres will increase continually and progressively with the
has been managed be merely just good they
fifteen years ago with small locomotives and cars light
rail- poor road beds absence of and safety
planes, the country transportation facilities would be
clearly obsolete and of keeping to-day Expenditures
have been made only necessary keep up with the
gess of the country Then it be apparent that the
raising of of money for extensions and
improvements is prime function of the company and of
highest Importance the public Surplus earnings cannot
be drawn where surplus exists. No one will buy
stock unless be expected to pay reasonable dividends
Property already covered by mortgage cannot be mort
gagged anew, and borrower in doing profitable business
cannot borrow money unsecured bonds or pronlsory
While Santa spent $50 million of borrowed money
it also spent fifty million of surplus earnings. If the
ngs had been sufficient for these expenditures the
pany would have had borrow fifty million thus
placing additional burden of fifty million the property
In order keep pace with the rapidyincreasing demands
of railroads everywhere it plainly necessary that the
plus earnings should increase correspondngy with the in
creased business increased business also increased
expenses Other increases due increased taxation
labor and materials Dividends be reduced the
stock without njuring the companys credit and
prevent its borrowing capital when necessary
The Santa Fe has been exceptionally prosperous rail
way company and yet increasing burdens OF operation
make it imperative that the company have such increase in
revenue if is fulfill reasonable expectations of the
public for Improvements and extensions OF transportation
and since such conditions the Santa Fe they
even more clearly other lines less fortunate
and whose transportation service call Tor enormous epend
lures and additional capital order to keep with the
increasing demands for improvements and extension Very
few companies have been able to spend much on i'm
rovenents the Santa Fe and such companies need all
the more protection from undue encoachent Of their
plus earnings by the rising tide of expenses.
The question of will be successfully solved if dealt
with in business way If business conditions continue
increase the railways will be able raise additional capital
without any undue burden in any direction provided they