New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-03-05
Big Increase in Operating
Expenses a Problem
for Officials
Bankers Worried, Too
Fear High Cost of Supplies
Will Affect Power to
Pay Dividends

Railroads OF the United states Will
have TO pay at less; slso,ooo, 900 more
for coal this year than they did last.
The sudden rise in the price Of btu
minous coal during the last fev days
has worried railway officials through
out the country. Many OF the Eastern
lines are now making contracts for
years supply at an advance OF 81 to
S1.25 over the 1916 price.
Eastern roads will shoulder half %
the total cost OF fuel. This means that
they will have TO deal with an increase
In running expenses o, az least ss5,.
100000. The s5o,OOO.OOO gain made BIZ
the per cent rate advance granted TO
Eastern lines in 1914 will be completely
wiped away.
There are other things that are
worrying railroads besides coal bills
Locomotives and steel cars are now
selling at record prices. Other sur
plies are also more costly than ever be-
fore. Increased wages are likewise q
large item on the debit side, and "
the Adamson law is found 70 be con-
stitutional the cost OF operation will
nullify the gains Of the last year and
will place the roads back in the fnsn-
cial condition in which they were "a
1914, despite the large current earn
ings.
Pennsylvsnia's Big Coal Bill
The railroad coal bill i, normally
about one-tenth of the total cost o.
operation. The two greatest consumers
OF fuel for transportation power are
The New York Central and the Penn
sylvanis companies The Pennsylvania
purchased 5,400.0 900 tons last yesr at
sl.35 a ton. Il will need more thar
10000 900 tons this year.
The road has written 20 colliery own
srs with whom It deals, asking tina.
they reserve tonnage 10 cover the re
quirements OF the company for year
and saying that a price will be agreed
upon later
l. is reported that the pennsylvar IA
in the last few days has met it's i'm
mediate requirements with contracts a.
1926 a ton. II the road Is able 10 ger
coal FOR the year sasn advance o. only
$3.50 a ton II will mean an increased
expense of s240oo,Oo0
Last year the New York Central used
Il 100000 tons al $40. A $50 I'D
vance would add about sis,ooo,Ooo 20
It's coal bill.
Eject Of Coal Increase
The two largest items in the direct
cost Of train operation are wages sn5
locomotive fuel. In 1915 these ex-
penses for the railways Of the country
were:
Wages .................S $500 100000
Coal OBSERVATION-DISCLOSURES. 220,000,o0c
Total ...................ss 20. 600 900
II only a dollar a ton il added 70
the cost of coal and the Adamson law
is found 20 be constitutional and IL in
terpreted as the brothernoods insist
that 10 should be, the increase in
operating expenses this year will be:
wages ...........-..--.-. SoOOOO,OVO
NoaI ..-..s...s...s... loO,VOVfVVp
lOLEI sAAcVsVDVfONV
The relation this increased operating
expense bears 20 railroad prosperity is
indicated by comparing IL with the
kNA4A QANAAtNAt 20 ~ ~ tsSNhMVAlFff
last year 265.000,000.
The rise in the price Of coal and the
heavy wage demand. are worrying
banking interests, because % the effect
that they may have or railway earning
power and credit. Other Industries
are meeting the rising price Of fuel.
material and labor by charging higher
prices 70 the consumer. The railroads
have 70 SUCH way out.
Frederick z. Seward. editor Of "The
Coal Trade Journal says:
There is one feature OF the btu
minous trade that perhaps might be
corrected. If the proper effort were
made in that direction. and that Is that
a certain amount OF coal has been Sc
cured BY speculative jobbers and the
marketing thereof is not conducted
along conservative lines, 70 say the
least"