New-York tribune., 1919-07-22
Either Has No knowledge
ON Transit Problem or
Wants Public to Have
Opinion Instead of Facts
Rentals Are Not Excessive
Burr Says He Will Ask for
Rehearing Before Taking
Case to Court of Appeals

Job E. Hedges, receiver Of the New
York Railways Company, in q letter
sent to Mayor Hylan yesterday, ac-
cused him of publishing mlsinforma-
tion with reference to the order Of the
Public Service Commission permitting
charge of . cents for surface car
transfers. The Mayor and Corporation
Council Burr had issued q statement
concerning the alleged swollen earn
ings of some of the constituent com
panies of the New York Railways as
proof that there was no justification
for allowing them to charge for trans
fers. Mr.. Hedges says concerning the
Mayors statement:
"Your statement indicates lack of
knowledge of the facts, or that you
are relying on some one to furnish
data, or that you prefer the public to
have your opinions instead of facts.
1.-The Eighth Avenue Railroad Com
pany, then a horse car line, leased its
railroad to the Metropolitan Street
Railway Company on November 23,
1895, for term of ninety-nine years
from January l, 1896.
metropolitan Street Railway Com
pany agreed to pay the Eighth Avenue
Railroad Company as rent $215,00O,
payable in equal quarterly instalments,
and agreed further during the first
two years of the lease to expend the
sum of at least $1,O0O,O00 or the
lessons railroad in sub bstituting some
other motive power in place of horses,
and in providing suitable equipment,
plant or machinery therefor.
Agreed to Pay Taxes
"The lessee also agreed that in ad-
dition to the rent it would pay all
taxes, car license fees and govern
mental charges of every character =
"The value of the Eighth Avenue
Railroad Company property used in
operation estimated by Ford, Bacon &
Davis, engineers, on the cost of repro
ductfon new, less depreciation, based
on normal average pre-war prices as
of June 80, 1917, was S5,970,413. The
annual rent of s215.oO0 is SO per cent
of this appraised valuation.
Taking from this appraisal all over
ing only land, labor and material, the
value of the Eighth Avenue Railroad
Company on June 80, 1917, was
s4,14S,340. The annual rent of $215,-
600 was 5.18 per cent upon this valua-
ton. The amount of property there
fore, at the service of the public in
Eighth Avenue and the branch lines is
not less than over $4,OO0,0OO, and is
allowing the usual overhead expenses
II round numbers, at least $6,00O,OO0
Every one comedies that the public
should pay not less than 6 per cent
Tor the use Of any property devoted te
It's service. Six per cent upon $4,000,
900 is $4,000, or S25 900 in excess Of
the rental paid to the Eighth Avenue
Railroad Company under the lease.
Entitled to Fair Return
The law of this state declares tha
the owners of a property are entitled
to fair return upon the property de
voted to the public service, which re
turn must not be less than per cent
and, to make allowance for reserves
and contingencies, should be in thes
times not less than 8 per cent
When the lease was made in 189
the capital stock of the Eighth Avenu
Railroad Company was 10000
which it had been since April, 1864
The company subsequently issued Ger
tificates of Indebtedness, which aggre
gated S750,00o on February J., 1915
when such certificates became due an
were extended.
capital liabilities against the propert
are S1,750,OO0, of which the annus
rental OF S21500 is exactly 1929 ne
cent and no more.
"To add the amount paid out fo
taxes to the rent and then say that til
Eighth Avenue Railroad Company re
ceives 26 per cent return upon it
stock is either Intentionally or igno1
antly to make false statement
"The result of the disruption Of th
Eighth Avenue Railroad Company frol
the New York Railways Company is ,
take from the owners of the New Yor
Railways Company several millions {
dollars at least $4,000, ,000), which the
used to make the horsecar line an in
proved, up-to-date electric line, and
transfer this property to the owners
the Eighth Avenue Railroad Company
If There Are inaccuracies
"T am giving this letter direct to II
press as my only means of lnsurir
that the facts VIII be there state
VIII you please write me direct in Il
ply to this, or address the public d
rectly, as to any inaccuracies IN stat
ments contained in this communl
alton? If am misinformed, | seek
be corrected and will announce n
error IN fact TO the public l assun
that you win be equally logical ar
sented facts"
The New York Railways Conpar
yesterday accepted the order of II
Public Service Commission permittlr
the company, beginning August !,
put into effect charge Of two cen
for transfers issued at all points {
it's lines not covered by municip
franchises Notices to this effect we
posted on the green cars yesterday.
Terence Farley, counsel to the COZ
mission, said yesterday that he doubt
the power Of the city, through Corpor
ton Counsel Burr, to successfully CO
test the transfer orderH-
Mr. Burr might be able to obtain
temporary injunction on the part
: the city" he said, "but I am certs
that it would be- dissolved within
very short time"
y Corporation Counsel Burr said y,
terday that he is preparing to conf
the order OF the Public Service Co
fnission-
My hrst step" ne said, will be
application to Public Service Comm
sioner Nixon for a rehearing. II y
ls refused We shall go to the Appel;
Division OF the Supreme Court and a
Tor an order restraining the cstrry1
out Of tho commissio1's ruling"