The Bridgeport evening farmer., 1913-04-25
RAILROAD MEN IN
 SECRET CONFERENCE ON NEW REGULATION
Try to Devise System for Arriv- ing at Estimates Government
 Demands

New York, April 25.-Railroad pres idents from North, East South, and | West went into a secret conference al the Grand Central station last even- ing to discuss ways and means of deal | ing with the physical valuation law
 which becomes effective next Thurs
 day. This gathering, the largest of it's
 kind in the history of the industry will continue until plans for meeting l the situatafon have been perfected. l The Iowa, passed on March 1 over ] the protest of the railroad men, was 1 originally proposed by Sena tor La Fol | lette and directs the Interstate Com
 merce Commission to Investigate, as- certain, and report the value of all | the property owned or used by every common carrier It calls for the ex- penditure of $6,0O0, ,OOO, a large part of which will have to be met by the com panies during the next five years, the time required to complete the task. Railroad men refer to the whole pro- ceeding a useless expenditure of time and money.
 When the bill was being considered last February, a number of railroad
 presidents were called before the Sem
 ate Interstate Commerce Committee.
 In each instance the witnesses pointed
 out that one or more railroads in each
 of twenty different States had at
 tempted to place value on their prop
 critics, but that in each case different
 valuation methods had been used by
 the engineers employed.
 To avoid a similar confusion Of re-
 suits, it was suggested that the Inter
 state Commerce Commission be in-
 structed to establish a railway va1ua-
 ton board, consisting of nine mem.
 bers, three to be selected by the Com
 mission, three by the American Rail
 way Association, and one each by the
 Chief Engineer of the Army, the Ma wy, and the American Society of Civil Engineers. That suggestion, however, was ignored.
 Where attempts have been made to place a valuation on railway proper ties, railroad men say that engineers have invariably used different meth ods of estimating land values, work ing capital, legal expenses, franchises, discount on bonds and stocks. cost. of construction, etc. One of the main objects of today's meeting was to- adopt standard methods.
 Railroad officers understand that the purpose of the law is to begin a cam paign of education for future use in dealing with freight-rate problems. La Toilette and his followers use such cases as the Alton and the New Ha- ven to show that there is a direct connection between excessive capital and freight rates, the property ac- count of a railroad on the assets side or the DdIdnCS SIISSl OOiAAO marked up to offset the bonds and stock issued.
 Champions of that theory say that the railroads never take Watered stock into consideration, but claim that freight rates are too low when a, com pany like the Alton is unable to pay dividends Tn answer to that argu- ment, railroad men reply that the investigation will show once and for all that the railroads of the country a whole are undercap-I italized. In other words, it is asserted that most of the railroads cannot be for anything like the amounts given as assets in the annual reports.
 The law which the railroad presi- l dents met to consider provides:
 '~That the commission shall, as here | matter provided, investigate, adscer- | tain. and report the value of the prop l erty of every common carrier subject l to the provisions of this act, and used by it for the convenience of the pup 1 lie. To enable the commission to make such investigation and report, it is | authorized to employ such engineers, | experts, and other assistants as may be necessary who shall have power to paths, examine witnesses and take testimony.
 'In such investigation said commits sion shall ascertain and report In ue- tail as to each piece of property owned or used by said common carrier for railway purposes, the original cost to date, the cost of reproduction new, the cost of reproduction in depreciated condition, and an analysis of the meth i ods- by which these several costs are obtained and the reason for their diff ferences, if any. The commission shall in a like manner ascertain and report | separately other values, if any, of the | of such common carrier, and an analysis of the methods of Valua- lion employed and of the reason for any differences between any such value and each of the foregoing cost values"