The Detroit times., 1913-05-30
Ohio City Traction Concern Will
be Forced Soon by Huge
Earnings to Give Two
Rides for Nickel
TRIES MANY SCHEMES
TO REDUCE SURPLUS
Latest is to Squeeze Out $780,.
600 Of Water and Replace
it With Cash

"While the d. U. Il. Is crying pow
erty, the Cleveland street car sys.
tenn IL making 30 much money on
three-cent fares, that there Is talk
Of reducing the fare to l-2 cents,
two rides for Nickel" said Freder-
tex T. Bancroft, who recently re-
turned from Cleveland after testify
ing for the city in case involving
the valuation Of a power house.
1.-THE Cleveland company Is max.
Ing 30 much money that Its man.
ayers are worried" Mr. Bancroft con.
tnusd. They are putting the street
railway companies OF other cities IL
deep hole by their showing. and
they are trying In every possible way
to turn out balance sheet that will
not look 80 favorable.
1.-THE scheme that has been tried 30
far has been the expenditure OF as
much OF the earnings as possible for
replacement OF equipment Since the
agreement with the city was adopt
ed. the company has laid 20 miles of
new track, and has bought $50 new
cars, all out o! earnings besides
paying the required interest on Sc
curities and reducing the fare. And
still the money pours into the treas
ury.
The last move Is the company's at
tempt to get rid OF power house.
which Is worthless. When the COM
pAny's property was appraised, the
company put huge valuation on this
power house, and its experts insisted
on It's importance and necessity. Now
the same experts are testifying to an
entirely different set OF allegations.
They claim that the power house IL
obsolete and useless-which Is true,
and was practically true when they
claimed that IL was so valuable. The
city has agreed TO leave the valuation
at $422 900, but the compny insists
that 100000 be added to this sum,
and the question Is being threshed
out In the courts.
If the company wins. it will have
$S22,0 In the capital account which
1t must replace from its earnings.
That will make big hole in the
years showing, and will make Cleve-
land a horrible example for other
street railway managers TO point to-.
"Now the city Is quite willing TO
eliminate this power house, which 1t
admits, as it claimed three years ago,
Is Of no value. But IL doesn want TO
let the replacement OF $o22 900 come
from the earnings or a single year.
1t wants the amour: spread over 10
years. The city viii oe pleased enough
to see this $s22,0O0 OF water wiped
out, and enough real money put In
the property to bring il somewhere
near the Tayler valuation but 1t
doesn't care TO hav,- all the money
come out OF its pockets in one lump
and II comes from its pockets, since
the people are paying the fares, ana
the rate Of fare depends on the sur
plus.
If the city wins, and the amount Is
distributed over a period OF years, ana
the earnings become so great that
fares will be reduced TO 2la cents, the
result will be interesting to watch. 10
Glasgow, the last attempt to reduce
the surplus by lowering fares was
miserable failure, because trafiic was
stimulated by the reduction to such
an extent that the surplus became
larger than ever. The people O.
Cleveland do not believe that such
result will take place there. but no
one can tell what will happen.
1.-THE Cleveland situation also
shows what great care must be ex-
ercised in the appointment OF
street railway commission the
Cleveland commissioner appointed
under the Tayler settlement was
friend of the street railway company.
and many of his decisions were In the
company favor and against the city.
This has handicapped the city to
Sveat degree, and emphasizes the
Importance to Detroit OF selecting
street railway commission which
consists OF friends of municipal own
ership. not hasty converts pr men
whose position Is not well under
stood"