The sun., 1919-07-09
HIGHER FARES
CERTAIN IN CITY
RAIL SITUATION
Compact System of Owner
ship and Operation in
Manhattan Forecast.
ELIMINATION OF LEASES
B. Il. r. to Be Continued as
Unified Service-Refi-
nancing Required.
ELIMINATION OF LEASES

surveys or the -NeW 1 OTk ttdliWdyS
Company and the Brooklyn Rapid
Transit Company. which are near COM
pletion. will indicate the desirability Of
radical changes it was learned by THE
Sun yesterday. In the reorganization
of Manhattan's green car system of
surface lines and of the B. r. T. the
following are likely to be develop
ments:
In Manhattan, the separation OF the
surface lines from the subway and ele
waited lines in ownership and opera
ton. The effort will be made to form
q compact system, with control Of i'm
portant units by leases eliminated
The mistakes of the reorganization Of
1911 will not be repeated The prospect
OF the stockholders Of the New York
Railways Company realizing anything
on their holdings Is remote.
In Brooklyn the B. r. T. will be
continued as a unified system, monopo-
Using Its feld. The reorganization will
be a process OF refinancing and of sim
plifcation OF the tangled relationships
between the holding company and its
subsidiaries.
The reoganizations depend upon the
success OF Lindiey M Garrison and Job
e. Hedges as receivers of the d. r. T.
and the New York Railways Company.
respectively. In meeting the emergencies
caused by the skyrocketing of labor and
materials. Both systems had to resort
to the Federal Court because Of war con-
ditions. The B. r, T. was without the
cash to finance its subway contracts be-
cause OF the absence of a market for Sc
eurities. The New York Railways Com
pany was not earning enough to pay
nxed charges.
Distress of Companies.
Higher fares are a certainty. Au-
thorization of increases may be delayed
but the distress OF the companies will
soon cause so much public Inconvenience
that action will be forced. Three sur
face lines of Brooklyn, not parts of the
receivership estate, failed TO pay interest
charges on July l. and default and
the extension OF the receivership are GER
tain in ninety days unless fares are in
creased.
II the receivers are authorized to in
crease fares and the companies are tided
over the present emergency, plans for the
organizations will be taken up and
these will be based on the surveys which
we're ordered by Federal Judge Julius
NJ Mayer when the receivers were ap-
pointed
The New York Railways Company is
The weakest OF the traction group. I'm
like the Brooklyn surface lines and those
of the Third Avenue Railroad Company
in The Bronx, II operates in a territory
that has reached the eaturstion point in
populatirf. The hope for its future lies
not In a prospect OF progressively in
creasing revenue, but in a sound reor-
ganization.
The New York Railways Company
was reorganized in 1911 preliminary to
the discharge OF the receivers. who had
been IN possession of the property of the
Metropolitan Street Railway Company
since 1907. Water was squeezed merci-
lessly from Metropolitan stock. A CAPT
talization Of $4,000. 900 was reduced tc
Sl74e5, 900 in New York Railways stock
Metropolitan stockholders were assessed
$3.50 on each share and got bonds OF
slightly more than that face value and
$40 in face value OF stock.
Joined TO the Interboroush.
The New York Railways Company wai
Joined to the Interborough Rapid Tran
sit Company. which operates the sub
ways and the elevated lines. by meant
OF the Interborough Consolidated Com
pany, which owns majority OF thu
stock OF both operating companies. OPP
srAtion was put in charge OF the sam'
set OF officers with Theodore p. Shont'
as president. Frank Hedley as Vice-pres
idsnt and general manager and Jane!
L. Quackenbush az general attorney.
The alliance. while II brought advan'
ages in economy. Is regarded as having
been a mistake. II Is felt that under
the conditions the tendency has been tc
subordinate the interests OF tho surface
lines where they conficted with those o.
the rapid transit lines.
In Manhattan the surface lines II
many cases are competitors of the rspit
transit lines AS the subway system ha.
been extended the north and south sur
face lines have had revenue diminished
A substantial part OF the short hau
Iafic, that would ordinarily 20 sxclu
sively to the surface lines, has been di
verted TO the subway.
when the New York Railways Com
psny was organized II was felt that tn,
sdvan ntages of unihcation were para
mount and leases with independent,
owned lines, which had been made dur
t-g william c. Whitneys consolidation
al the Metropolitan system. were re
hewed The leases called for specific an
n