Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1919-01-25
DireCtor-generaI Reports to
Congress That Government
Lost S196,000,O00 On 0p-
erationS During 1918.
CORPORATIONS CANNOT
GET FUNDS TO Go ON
Whether Properties Are Re-
turned to Owners at Once. or
Retained for q Months,
Amount Must Be Had,
t.r sosslss sours., sr.e,.l ls.srO WHEEL

Washington, Jan. 24-The rail-
road administration needs S750.0OO.-
600 more for its revolving fund to
supplement the 10000, 900 origin
ally provided and now practically ex-
hausted. In preparing this estimate
for congress today. Director General
Hines explained that $196, 100000 of
this sum represents loss to the gov
eminent, incurred in operations last
year, and the remainder represents
advances to railroad companies, to
be repaid eventually with interest.
Congress will be asked Immediately
to appropriate this amount which
Mr. Hines declared would be neces-
sary regardless of whether the rail-
roads were returned to private man
agement within a few months or re.
tanned longer.
The director general estimated
that $36S,193.0 900 would be required
this year to finance capital enter
prises, such as improvements and
purchase of cars and locomotives,
which railroad companies are not
able to finance without borrowing
from the government. This figure
also includes $12,S40,000 for con-
templated expenditures on inland
waterways, and $20,000,000 to fl
nance reorganization of the Boston
and Maine.
Where Money Went.
For 1918, the demands accumulated
against the revolving fund included
Additions and betterments financed
by the government, S290.91S. 900;
cash on hand employed as working
capital. for which railroad companies
must be credited Tow and charged
when government control ends, $247,-
100000; other working capital in the
shape of conductors and agents bal
ances, loans made to companies with
materials and supplies as collateral,
less current liabilities of these ac-
counts, $9t, 952, 900; loan to New
York New Haven and Hartford in
volving a reorganization of finance,
51,475, 900; advances for inland wa
terwayS, all but about $4,000 rep
resenting investment in boats and
other property. S4,36l,0 900. These
items total $6S5, SOC, 900.
Government Loss S196.000, 900
This sum, together with the $780,
100000 loss to the government ON ac-
count of the difference between OPP
Grating income and returns guaran-
teeds the roads, make 1881, sos, 600 for
which the government would be Ii
when all railroads accounts for the
1865, 1873 900 estimated requirements
for 1919. makes $3.50, 900 esti-
mated drain on the revolving fund
for both 1913 and 1919. and with al
lowance for the $500 100000 already
appropriated the new needs are com
puted at $3.50, goo. The director
general refers to this as n minimum
requirement and all figures are sub
ject to later revision
This report also shows that the
present revolving fund Is SIS .S0G.-
ono too little to settle all accounts of
1918
"A Yer ylarge part of these expend
itures must be provided for in the
first few months of 1919" said the
director general "and we are COM
PEELED to allow for the situation that
during the period prior to the next
liberty loan compaign and during
that campaign it would not be desir-
able or practicable for railroad corr
porations to do large part of their
own financing.
Whether government control shall
continue until the end of the TWEEN
ty-one months period or shall be ter
minated in the next few months. II is
equally necessary that the appropri-
alton above recommended be made.
If the control continues for the
twenty-one months period, it is my
belief and the belief of my associ-
ates in the railroad administration
that we cannot count upon the rail-
road companies financing during the
calendar year 1913. any greater por-
ton of their capital expenditures
hoy q OIL will
finance. On the other hand. If con-
troll should be terminated in the next
few months it will still be true that
a very large part of the capital eX-
penditure for 1919 will have been
made and besides the possession of
an adequate fund to facilitate the
transfer back to private control and
to give temporary aid in financing
viii be highly desirable"