Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1918-03-15
R. R. BILL PASSED.
Congress Finally = Dis.
poses of Measure
Now Goes to President-Ptans tor ru'
ture Organizations Discussed az
Conference Between President and
McAdoo

McAdoo
Washington, March 14.-Congress n
nally disposed of the railroad contfoi
bill today when the House agreed 10
the conference report adopted by the
Senate Yesterday The bill now goes 10
the President.
The measure compenSates the ran
roads for the use of their properties
during the war on a basis OF their net
income for the three years ending June
80, 1917, limits federal operation TO
Il months after the war, authorizes the
President to initiate rates, subject 10
the approval of the Interstate COM
merce Commission: appropriates Sooo,-
600, 900 as a revolving fund for the d.
rector general and places all snort
lines under federal control.
Plans for future organization OF the
railroad administration un-
der the railroad control bill finally
passed by Congress today were dis
cussed tonight at a conference between
President Wilson and Director Cen
eral McAdoo.
One of the first big tasks will be
making contracts with each railroad
company for government compensation
on basis provided in the bill. Under
the direction of John Barton Payne.
chief counsel, John Shelton Williams,
finance director, and G. A. Prouty. chief
of the division of accounts, the ne
gotiation of these contracts will be
undertaken Immediately. 1t probably
of
them.
With fund at his disposal with which
to administer the affairs, McAdoo now
will Ak the salaries of his assistants.
most of whom have several connections
with railroads. Heretofore the exposes
of the railroad administration have been
borne from an allotment from the Pres
ident's emergency fund.
Provision will be made for the $780,
bill in determining the amount Of the
third Liberty loan
President Wilson's signature to the bill
for government operation of railroads I'M
til q months after the war completes
the plan for the greatest undertaking in
government control of privately owned
public utilities the war has brought to
America.
Early in August. 1916, the war cloud
was growing ominous, so an act was
passed empowering the President
through the secretary Of war, to take
control of and utilize all systems of
transportation in d national emergency
President Wilson employed this authority
on Dec. Is, 1917, taking possession of the
lines and appointing Secretary of the
Treasury McAdoo director general of rail-
roads
Engaged in war requiring every bit
of national effort to insure success, the
President believed it was imperative that
the government direct all operations so
that adequate means might be had to ex-
pedite troop movements, move war sup
plies, and care for the generally abnor-
mall strain on the transportation system
The flow of khaki-clad men had to pro-
ceed TO the ports of embarka ton without
shells, cartridges and rifles
had to be moved from munitions centers.
foodstuffs had to be transferred from the
granaries of the West, and ample pro-
the mines. In addition to military needs.
the country had experienced during the
winter OF 1917 the greatest break down and
congestion of the transportation system
ever known.
Al a stroke of the Presidents pen
the roads came under federal admin
istraton. Property rights were not
government merely ex
erclsed its authority to operate the
lines and provision was made for safe
guarding the proprietary interests of
investors.
At the request of the President Con
gress then set about to enact law to
carry on the step taken as an emer-
gency under the law of 1916.
In substantial accord with President
Wilson'S recommendation, the law pro-
Vlded that the compensation estimated
AT s945,0OO,0O0 annually, shall he pred
lcated on average net earnings for the
three-year period ending June 80. 1917.
The amounts will be ascertained hv
the Interstate Commerce Commission
and certified to the President. who will
negotiate with the roads for their ac
- PN~~A'SS' - ldAeS, SuCIl Us ma
tional or state, shall be paid out of op-
Grating revenues, but war taxes must
be paid by the companies out of their
own funds or charged against the
standard return. In that way, the roads
will bear their proportional share of
the war burden. So that the properties
may be returned to their owners in
condition as good as when taken over,
provision vas made for their mainte-
nance and for protection against I'M
usual deterioration.
In the absence of complete federal
valuation IF railroads, the exact rate
OF return to be made by the govern
n,ent cannot be stated accurately. but
it is estimated that the companies will
obtain an amount representing nearly
five and a third per cent.
In event that the President finds that \
equitable return cannot be computed for
some roads on the three-year pre-war
basis because of abnormal operating con-
ditions during that period he is author
lied to fix an amount as he shall believe
reasonable.
In case road refuses to accept the
amount OF compensation as estimated BY
the interstate Commerce Commission.
board of referees shall be appointed to as