New-York tribune., 1918-07-13
Federal Contract
Acceptable to
Railroad Heads
Executives Approve, but
Warfeld Committee Asks
Notifications

plan for operating the railroads of the
country during the period of Federal
control was declared generally accept
able yesterday by the Railway Execu-
tives Advisory Committee at the con-
clusion of fve-hour session in the
board room of the New York, New
Haven d Hartford Railroad, at the
Grand Central Terminal This organ
ization represents over eighty different
systems. whose mileage is more than
80 per cent of that for the entire
country.
Before giving the governments pro-
posal final approval, however, it was
understood that the committee of the
railroads would request the Director
General to give assurance that rentals
for leased roads receive the same pro-
lection which is already conceded with
respect to the interest on bonds
Thomas De Witt Cuyler, chairman of
the Advisory Committee, who presided a
at yesterdays gathering, issued the
following statements:
"Io-day's meeting was for the pur-
pose OF receiving the report of our
counsel and of considering the govern
ment's proposed railroad contract draft,
dated July S. The committee feels that
the proposed contract is, in the main,
acceptable. There are some points
which the committee desires to discuss
further with the governments repre-
sentatives. These will be taken up as
soon as practicable"
Three special committees of the Ma
tlonal Association of Owners of Rail-
road Securities, representing approx
imately $5,000,000 Of railroad securi-
ties, held principally by insurance COM
panles, trust companies and savings
banks. were also present at yesterdays
gathering at the invitation of the rail
road organization. This group, through
Samuel Untermyer, as counsel TOOK
issue with the opinion of the railroads
committee and, at meeting following
the earlier session, adopted the follow
ing resolution, which was given out by
5. Davies Warfeld president Of the
security holders association:
Resolved, That, in the judgment of
the committees representing the Ma
tlonal Association Of Owners of Rail-
road Securities, the tentative draft Of
contract of July submitted by repre-
sentatlves OF the government is unac-
ceptable in the particulars set forth
IN the letter of the committee of July
II, addressed to the chairman of the
Railway Executives Advisory Commit
tee, and that the committees, repre-
senting the association, proceed by
further negotiation and by appeal to
the Director General with the effort to
secure the notifications therein de-
scribed
Resolved, That, to that end, coun-
sci for the committees are instructed
to prepare as promptly as possible
amendments covering the desired
changes for the consideration of the
committees.
"Resolved, That, in making such ef-
forts, the committees cooperate with
the Railway Executives Advisory Com
mittee"
The letter, addressed to the Railway
Executives Advisory Committee by
the committees representing the Ma
tional Association of Owners of Rail-
road Securities, in effect declared that
the governments contract in it's pres
ent form does not protect the credit of
the railroads nor the owners of their
securities to the extent which the asso-
clatlon believes it has the right to ask
and to expect.
ut has been generally assumed"
says the letter." "that in some wav
the tentative draft of contract pro
vldes guarantee of the payment of
interest and regular dividends hereto
tore paid on the securities of the rail-
roads. The security holder has also
assumed that as to the principal of his
investment he would be at least as
safe as before, since it has been be-
lleved that the government under the
contract will only use the railroads
transportation system, and that at the
end of the period would return in each
case a gong transportation system not
less solvent or less capable of private
operation than when it was received by
the government. We do not need to
point out to you that this will not be
the result under the tentative form of
contract which is now submitted"
Yesterdays meeting was probably
the largest gathering of railroad ex
ecutives and lawyers that ever assem-
bled in one room. Those in attendance
included w. G.. Besler, president Of
the Central Railroad of New JERSEY:
Harry Bronner, president of the Mis-
souri, Pacific; E. N. Brown, chairman
of the Pcre Marquette; G. r
Brownell, general counsel for the Eric.
p. G. Buckland, president Of the New
York. New Haven e. Hartford; C. A.
de Gersdorf, general counsel for the
Missouri Pacific: A. r. Dice, president
OF the Philadelphia & Reading; New
man Erb, president of the Ann Arbor.
Howard Elliott, president of the North
ern Pacific: Francis |. Gowen, general
counsel for the Pennsylvania; Law
renee Greer, president of the Western
Maryland; A. II. Harris, vice-pre sident