Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1917-03-17


ments Of. say. four cents, had the ID
system been In operation last year.
difference Of six-tenths Of a cent Per 4:
enue passenger does not seem to be 3
gap between the city and the company;
when we consider that the compauY
ried about 5o0.000,0o0 revenue passef1
last year, II is evident thar there ~
have been a shortage of about $500
Of the amount necessary to carry the
fed system last year. II to this $3.O0o.01X
be added the 100000 which the compor
received from the exchange ticIxets WI
gram, It is obvious that there would bo Z
deficit of about 100000 In the cash ~.
essary to meet the requirements.
WHO SHALL PAYf
1T Is therefore clear that the dif1cu1t5
in the negotiations lies in deciding MI
shall pay this excess cost, and no lease 81
be decided until this matter il deCnitefy
and permanently settled. ~
"A temporary reduction in the city's pro
gram Of construction would not change tli
principles involved but would temporarlIS
affect the amount Of the shortage.
Under present laws the company cauX
not be made to assume this excess cost,
Il want to impress upon you. gentlemenX
the seriousness of this situation and wan
TO ask you to give this question seriou
thought. for this must be settled fairly q
It is to be settled at ALL A settlement Alou1
the lines Of the 1907 contract will result n
nothing but abiding dissatisfaction, and
contract Of this magnitude which intersot
every citizen as stockholder of the city
should be given careful study and investi|
CATION.
Il am simply amazed that your organi
zation. which is composed of promfnenI
citizens and business men. has not in am
way endeavored to independently check III
figures and statements which have beet
hNr hto Aar As.r
have not In some way endeavored to TAX
stand or definite position in this transl
situation.
TOO BIG A MATTER
This matter is too large to be left q
the opinion of any individual without sew
eral or at least one Independent check.
The situation has grown within the Lar
-FOUR years from an estimated investmeu|
by the city Of $35 900 to an investmen
estimated at present to exceed $4,000. 900
lThis estimate Is in dispute. Mr.. TayX
lor denies that the cost will be this great
Editor EVENING LEDGER.1
AT the same time the original invest
ment by the lessee has dropped from $2e
100000 to $17.0Oo.000.
Originally the company's investment W.
to have been over forty per cent Of u
total. and has now dropped to less tina
nineteen per cent.
The earnings of the system as planne
IN 1913 were estimated to 81 of gross I'd
$lO of investment. This is now dimir
ished to VI Of gross to SIS Of investmen.
The transit commissioners report
1913 stated that 81 Of gross earnings to
OF investment in rapid transit lines va
all that could be profitably supported.
All large enterprises are financed
borrowed money.
whether furnished by corporation or BY
city. The only difference between the ui
or city money and corporation money III
In the difference in the interest rates
which the money can be borrowed. IN
rate to be paid on the borrowed money ii
pends upon the credit Of the borrower. IN
basis of credit is the financial soundness
the borrower. The security of the loan muX
rest upon the ability of the borrower |
pay the interest and repay the principal.
ENGINEERING DEFINED
"McHenry has defined engineering
the art of making every dollar of invea
ment earn the maximum interest possfU4I
"As the city is now committed to q pF&
gram which involves a large investme1
and consequent interest payment, II
the duty of every citizen to use his bel
efforts to obtain for the city the best n
suits possible.
There is no question that the city ca|
finance its program. as the city bonds ID
volve the faith and credit of the entii
the earnings of the system, but the cit.
must determine, before any lease can
executed. whether those bonds are to
carried by the taxes or by the business. Al.
IL the business, in what way and to whs
extent.
THE proposed relationship between tn
city and the Philadelphia Rapid Trans
Company may be described ia this wal
The citys system may be represented q
vigorous young man. who through altrrl
istic motives has been induced to undertnt
to build large. new and modern plArX
for the making of q public necessity. an
has thereby incurred heavy debts and obi
cations He then, for business reason@
proposes marriage to woman fourtee
years older. who has inherited an old plan|
practically monopoly used for the sam
purpose. which she continues to operRtX
though twice as large as the one he intend
building. The woman's plant has been we'd
profitable, but 1t is so encumbered by 81
quests to relatives. under the will. that III
own income has been very uncertain Al
on at least two occasions she felt that AZ
situation was almost helpless. She has be.
resourceful, however. and lately, the a
normal prosperity. combined with chanG
Of managers Of her plant. has produced
substantial income for her. The pair realis
that when they are married her income vi
not provide their living expenses and ais|
care for his obligations. They are uoV
wrangling over the terms of prenuptia|
agreement. and bone of contention is III
matter Of using her income to apply to III
debts. She insists upon retaining mo6
of " for her own private use, while he ID
sists that greater share must come d
him to further his plans or else both mud
become charge upon the public. She coi|
| tends that he must cu-tail his obligatiox
by reducing the extent Of his plant or eli
agree to raise the cost Of the products
his works. He objects as he is rath1
stubborn. and is determined to carry 81
his plans as matter of pride. He enjt2
good credit which~she aims to utilis&x
protect herself and her burdensome
tives He, urged by his friends, want6<
! to join with him in trying to break
will and thereby secure relief from =
| e/essve and unwarranted bequesta NAL
L>ly there Is no love between this NJ
| congenial pair and their present relatioI
ship is only matter of expediency.
nizi he nnAt l<x<. A.