Evening journal., 1918-01-05
TEXT Of RAIL[ DAD
OPERATION BILL
Compensation Based on Net
Operating Income Urged
by President
REVOLVING FUND
PROVIDED FOR

WASHINGTON. Jan. 5.-The admins
tration bill for government operation Of
railroads proposes that the government
shall pay compensation at an annual
rate as near as possible TO the net oper-
stne income for the three years ended
June 80, 1917
The bill also would appropriate $780,
100000 70 be used as q revolving FUND
with the excess earnings OF the roads
for the operation OF the law.
The bill is entitled "a bin TO provide
FOR operation Of transportation systems
while under Federal control for the
Just compensation Of their owners and
for other purposes"
Section 4 provides that the President
Is authorized to agree with and guar
antee 10 the roads that during the Fed
ersl control they shall receive as just
compensation an income at on annual
rate equivalent as nearly as may be to
the roads average net galway operat-
ing income for the three years ending
June so. 1917. This the bill calls the
standard return. This section provides
that the net railway operating income
Interstate Commerce Commission, ex-
cluding debts and credits, arriving
from the accounts which are called In
the monthly Interstate Commerce re-
turns "leased road rents and nisceilan-
eous rents"
No Federal taxes Ia excess Of taxes
assessed during the year ending June
30, 1917, are 10 be charged against the
-. nrH
turn. Any net railway operating in
come in excess Of the standard return
Is to be the property Of the United
States.
The amount of the standard return
accruing during the three year period
Is to be determined by the Interstate
Commerce Commission, whose certlh-
cate as to the amount Is 10 be taken as
final and conclusive for the purpose Of
The agreement and guaranty.
During the Federal control, adequate
depreciation and maintenance for the
properties Of the roads will be included
as apart OF the operating expenses or
provided through reserve fund, In ac-
cordance with principles and rules
which the President viii determine
Section 2 provides that If no sueh
agreement Is made with a road, the
President may nevertheless pay or
cause TO be paid TO any railroad while
under Federal control, not exceeding 30
per cent of the standard return. Under
this section the legal rights of the rail-
road for prosecution of its claim for
the balance before the Court Of Claims
is provided for, and any amount found
due above the amount that had been
paid will bear interest at 6 per cent. a
year. and any excess amount paid by
The Government win be recoverable by
the Government with per cent. in
ierest.
Section 3 provides that any claim for
Just compensation, which Is not adjust
ed under the terms provided I'm Section
4, Will be submitted to 3 board Of three
auditors appointed by the Interstate
Commerce Commission, whose mem
bers and official force will be eligible
for that service without any additional
compen alton. These auditors VIII give
a full hearing Co the road and to the
Government and will report 90 the
President the amount due the road as
just compensation a sum not exceed
ing the amount so reported may be
agreed upon by the President and the
road. Fcsihlg this agreement either
the Federal Government or the road
may ille a petition in the Court Of
Claims for final ascertainment Of the
amount Of just compensation and in
the Court Of Claims proceedings the
report OF the auditors viii be consid-
cred prima facie evidence Of the facts
stated The just compensation Of any
Federal-controlled road not making ne,
turns TO the Interstate Commerce Com
mission will be determined In accord
ance with these provisions
Section 4 provides that the return of
any carrier will be increased by an
amount reckoned at a rate per cent 20
be fixed by the President upon the cost
Of any additions and improvements
made while under Federal control by
the carrier from its own capital or
surplus and by an amount equal 10 the
rate accruing to the Government upon
any advances made to the road for the
'ost Of additions and improvements.
Section prohibits any carrier while
under Federal control without the
Presidents prior approval from declar-
ing or paying any dividends In excess
of its regular rate during the three
years ending June 80 1911 This sec
tion stipulates, however, that the rail-
roads tnat nave paid no regular dlVi-
dends OF no dividends during that
period may, with the Presidents prior
approval, pay dividends at whatever
/. rate the President may determine.
Section appropriates s5o00000OO,
which, together with any funds avail
lble from any excess earnings Of the
railroads, may be used by the Presi-
dent 'as a revolving fund to pay ex-
.penses Of the Federal control on any
denoit Of a railroad below the standard
.eturn and 10 provide terminals, i'm
provements. engines rolling stock, and
other necessary equipment. These ter
minals. Improvements and equipment
are to be used and accounted for as the
President may direct and to be disposed
Of as Congress may hereafter provide
The President may also. according 20
Section z, order any road to make any
additions and improvements. He may
from this revolving fund advance 20
the road all or any part of the ex-
Sam IOvdS Rrsiu Food |