The Birmingham age-herald., 1912-05-28

1908 ,...--................... 17.s2s.E
 l5V5 ...'...--....-..-.-...-.... 2S,J32.3l
 IsiO ...-..--t.........-...... 4o,l6o.23
 1911 .....-.....t-...........-. 45,09o.25
 Compiainant's total net income from It's intrastate business for the six years amounted to s2S7. .s95.s5. or an average net income on intrastate business of $47. .9s2. 6s per year.
 The per cent earned from it's intra- state business for each of said years, on the value of the portion of the property devoted to intrastate business. was as follows:
 l l.06 ........................ 365 per cent 1 1907 .............-......... 2.79 per cent l 19oS ........................ I'll per cent
 1909 ........................t 1.16 per cent 1 1910 ...--........-...-.....-t l.sl per cen, 1 1911 ......................1 1.72 per cent
 This is an average yearly per centnni 1 Of 199 per cent: or per cent less than the remuneration complainant was en- titled to earn, without legislative inter ference, under the constitution and laws, 1 from it's intrastate business.
 l Neither the passenger rate act. nor the 1 iiO commodities act, nor the eight group acts went into effect on the lines of conl- piainants until the first day of June, 1919 in consequence of the preliminary | inlunctions. In ascertaining the effect Of either of those rates the master has not been compelled to indulge in specula- l tlon of any sort. but has had the benefit of a knowledge of the conditions as they actually existed during the several periods i anterior to June l. 1909, and, since then has seen the effect of the passenger rate act and the eight group act, by an ac- 1 tual trial of them for nearly two years more.
 The rates in effect on the Western l hallway, when the legislation complained Of was enacted, were known as the Com pany Rate They had been in force since 1903, and remained in effect as to intra- state traffic. until the eight group acts and the passenger rate act were put in force June l. 1909. The master finds that the losses in earnings which the Western railway would have sustained from April 1 |. 1907, to May 31, 1s0s had the statutory rate been put in effect during that period, would have been as follows:
 For the fiscal year 1907 7... sss,26 5.46 For the fiscal year 190S...... 3S,292.11 | For the fiscal year 190s.... 4S,321.si l For the fisca year 19l0....,. 54,305.7 tFrom July, TO through April, III. The Company Rates permitted free 1 flow of passenger and freight traffic and had been accepted for years by the public and the authorities as reasonable. h. decd. two years prior to the enactment oi the present rate statutes, the railroad commission or AlaDdfnd ndu Ildue dn e&- haustive investigation of the reason ableness of the rates of the chief car riers then in force. and decided that it had no power to reduce them, because those rates were not yielding to the carriers anything like just return upon the value of the property devoted to their intrastate business
 REDUCTION OF RATES HAD NO AP- PRECIABLE EFFECT IN STIMULATE 4
 TRAFFIC.
 Much testimony was taken and many statistics were offered as to the ef- feet of the reduction of rates in stim- ulating intrastate freight and passen- ger traffic. The witnesses generally were of opinion that the reduction fin rates had no appreciable effect on the value of traffic and that such increase in traffic as has occurred since June 1st, 1909. was simply a continuation of the normal increase of traffic re- sulting from the general growth and prosperity of the country The proof bears out this conclusion, well as 1 that of the master that whenever there | was an increase or decrease in inter state business 1t was reflected in intra . state traffic and that as general l thing, with few exceptions when | tonnage and revenue in affected traffic intrastate business) increased, they also increased in unaffected traffic dnterstate business). and when they fell off in one, they fell off in the other" It also appears that in many periods when there was an increase in gross revenue, the ratio of oper ating expenses to gross revenue had so increased that there was less net profit than in other periods when the gross revenue was less It Is clear from the testimony that the reduction in rates has not stimulated the intra- state business of the complainant. and certainly not to such an extent as to yield 1t fair return on its property devoted to that service. when the for mer higher rates, which were reason able and allowed by law. yielded an in- sufficient return.
 RATES CONFISCATORY BY ANY
 STANDARD.
 Whether we fix the value of the en- tire property of the Western railway at the amount which 1t was shown it would cost to reproduce 1t, or at the values at which 1t was assessed for taxation, or whether we adopt the unit of service bases, or the method adopt ed by the master in these cases to de- ternine the value of the proportion of the whole property properly as signable to the intrastate business, or determine 1t in any other mode now
 
 reduce the values thus obtained by one-haIf, which no one will claim. in view of the evidence. could be done its Is perfectly manifest that the West ern railways net earnings on the value of the proportion the property de- voted to it's intrastate business would fall far below the amount necessary to relieve the rates of the charge of con nfiscation.
 ORGANIZATION OF CENTRAL OF
 GEORGIA RAILWAY COMPANY.
 The present Central of Georgia Rail- way company was organized in No- yemher, 1895. pursusnt to a plan of reorganization affected by Thomas and Ryan. who under foreclosure proceed ings. became purchasers of the main line and other railroads and proper ties of its predecessor. the old Central Railroad and Banking company of Georgia, and afterward conveyed them to the Central of Georgia railway.
 The total mileage of the Central sys- tenn fin Alabama and Georgia. including four and a half miles in Tennessee. at the time the master made his re- port was 1915S5 miles, and it's cap italization. at the time of the organ ization including stocks and bonds which represented the then entire value of the system. was $51.410.000. The proof shows that the capitalization of the central railway at the time of it's organization was about the same as that of the old Central Railroad and Banking company, and that the cap italization per mile of the old and new companies including both stocks and bonds, at that time, was about the
 It IL -c