Harrisburg telegraph. [volume] (Harrisburg, Pa.) 1879-1948, 1918-07-10
RAILROAD RUMBLES
OFFICIALS BALk
ON AGREEMENT
Railroad Men Not in Accord
With Government Oper-
ating Terms

Local railroad officials may be call
ed as witnesses in conferences to be
held Friday in New York city, when
railroad officials will meet members
of the railway executives advisory
committee.
The Pennsylvania Railroad will be
represented by Samuel Rea and by
Thomas Dewitt Cuyler, the latter be-
ing chairman of the railway execu-
tives' advisory committee. Agnew
T. Dice, president of the Philadel-
phia and Reading Company. and
Charles Heebner, general solicitor,
will attend for the Reading. Among
the witnesses, it is said, will be n.
w. Smith, general superintendent of
the Eastern divisions of the Penn
sylvania railroad.
Instead of the railroads and the
government being in perfect agree
ment over the terms of the contract
regarding the basis on which the
railroads are to be operated during.
the period of the war, expressions
from high officials of roads center
ing in this city yesterday indicated
many objections will be raised over
/ certain clauses at the meeting Fri
day.
This committee represents virtual
ly every road of size in the country.
Its opinions in the past have been
taken as a guide by stockholders of
the lines it represents. AS the pres
ent contract must be approved by the
stockholders of each individual road,
the outcome of the conference on
Friday, in case a decision is reached,
is expected to be significant, as in
vhnf
groups of stockholders may take.
Executives here say they intend to
reserve comment, in view of the New
York conference being but two days
off.
Questions to Come Up
The question of compensation, for
example. promises to furnish discus
sion on the ground that the contract
does not clearly state how far the
government can cut into the rental
to be paid the corporate end of the
business. 1t is pointed out that the
document does not fix the return al
lowed on improvements and extern
sions which the railroad manage
ments are ordered to make. Au-
thority to guarantee the lines a re-
turn on millions of dollars worth
of extensions is vested in the discre-
ton of the government. The argu-
ment that a definite return shall be
fixed will be threshed out at the
New York conference.
Another point to be pressed is the
clause applying to the right of the
director general to decide whether a
road is suffering from deferred main
tenance. In many instances the roads
were unable to maintain their lines
properly and admitted this failure
on their accounting sheets. Where
this has happened it is believed the
government will make good the def
cheney by making the improvements
indicated and deducting the amount
from the rental, which otherwise
would go into the treasury of the
corporation. Railroad executives, it
is understood, will be willing to con-
cede the justice of such a step. The
point over which controversy threat
nothing to prevent the railroad ad-
ministration applying wholesale
maintenance charges at its discre-
ton, regardless of the extent to
which proper expenditures were
made in the past.
So far as the interests of the
stockholders are concerned, the fear
expressed during the negotiations at
Washington that dividends would be
endangered has been eliminated by
the clause declaring that additions
and betterments shall not prevent
payment of regular interest charges,
existing sinking fund payments or
expenses of keeping up the corporate
organization.