The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-04-06
LOREE URGES RELIEF
FOR HARASSED ROADS
Says Regulations Operate to En-
nance Difficulties Of Max
ing q Profit.
y. & II. HAS GOOD YEAR
Annual Report Cites Need for
Greater Return on In
vested Capital.
y. & II. HAS GOOD YEAR

The annual report OF the Delawar and
Hudson Company - interesting In view Of
the present discussion over freight rates
and because Of the amount Of detail 9iven
by President L. r. Lorce to the causes
adversely affecting railroad incoms'' and
the 'remediea" The report shows that
the net income carried to profit and loss
was Ss.i7a.735. a. compared with $685.
oss the year before. or an equivalent to
1883 per cent. earned on the el3sos. 900
capital stock. against 1895 per cent
earned on the same stock the year previ.
GUS.
In speaking Of the income Of railroads.
President Loree says: Those causes.
some OF them legislative and all Of them
beyond the control Of railway managers.
which during recent years have contnu-
ously operated to enhance the dificulties
attending the effort 10 maintain a reason
able margin between operating revenues
and necessary expenses for taxes and for
operation we're not less effective during
the year covered By this report. Increases
In wages consequent upon arbitrations
under Federal statutes. supplemented by
reductions in the hours Of labor. have
greatly augmented operating expenses.
Law Prsvsnts ReessUaesa.
-coacurrsntiy With these Increases IN
necessary expenses the process Of attack
Ing the rate schedules IN detail reduc-
Ing here . single rate and there . group
Of rates. has operated to reduce the gross
receipts on account Of services rendered.
While all these adverse forces have been
IN vigorous operation. the law has inter.
posed to prevent but temporarily. re-
EQUIPMENT from any source"
Mr. Lores then takes up the matter Of
Increased wages and decreased efhciency,
Federal and State regulations. increases
In taXes the loss to the roads through the
reduction OF the business OF the express
companies by the operation Of the parcel
pos, and the additional burden put upon
the road by the carrying Of heavier mails
without adequate compensation.
He then says: From the conditions
described II has resulted that although
the railways now represent largely In
creased investment of capital. they have
4 smaller annual margin Of gross income
over necessary expenses and axes than
they enjoyed when the capital employed
vas much less than II Ii at present. With
this situation. the pressure of 'rafYic upon
facilities and the public dem,.1d for In
creased comfort and safety OF travel and
transportation have continued so that the
ALWAYS are required to make large ad.
.ditions to their capital, while their ability
20 attract new capital and even properly
reeompense the capital already employed
is steadily diminishing. Moreover. there
has lately been u worldwide rise in rates
OF interest"
Limit Of Economics Reached,
During the earlier stages OF such q sit.
nation Mr. Loree says. the situation was
more or less effectively met by economies
in operation principally secured by the
additions to the capital already employed
THIS was brought about by heavier equip
-nent terminal facilities anc improved
facilities OF all kinds. but 4 Ia now felt
MAT the limit In such sort Of economies
has been attained.
The need for 4 greater return IN that,
invested capital has been acknowledged
by competent authorities according to
PRESIDENT Loree. who quotes az foliovs
from the decision Of the board Of ar.
otrators rendered on November TO- 1918:
This board has no authority TO do
sernhlne the passenger and freight rates
70 be paid In the Eastern territory;
neither Is II In position to determine
whether such an increase 10 justified. a.
matter OF fact, by all OF the circum-
stances This board however, believes
tfAt II must make It's findings az to what
k proper rate Of pay to be awarded
% the conductors and trainmen As a
result OF this arbitration. without any
reference TO the dilemma In which rail-
roads are evidently placed by the laws.
which make II impossible for them TO in
crease Passenger and freight rates with
out the authority Of the Interstate Com
missions of tho various States"
Arbitratoss Are Quoted.
Commenting further upon the immense
additions TO railway capital which they
FOUND 10 be desirable, the srbitYators
said:
ANY policy that would mako Il I'm.
possible for the railroads to command
thls money would be n profound misfor-
'u1e To the whole nation"
Tine total operating revenues OF the
Delaware and Hudson Company railroad
department. for the year ended December
81, 1918. was s24,153.494. as compared
With SEE 4so,1o2 for the year previous.
an Increase Of Si.s73ss1. while the net
-evenues from operation were 3s.948.i67.
against sS,<i3.324 Tho gross revenues
from the coal department we're ols.0f5.-
nos. as compared with sf3 3s7 .667 In 1919.
With net revenues Of 314.74s.615. against
sl2.sll,52o The net income Of the rail-
road department was S4.e26.976. a. COM
pared with SA,4ilS63. The general profit
and loss surplus on December 81. 1918,
vas sls,i5a.20s against sl5.l99.t&6 on
december 81. 1912.