New-York tribune., 1919-08-19
Warfield Plan Outlined and
Explained to the Conn
mittce by the Counsel
for Owners Association
How Scheme Will Work
Distribution of Earnings
Over 6 Per Cent, One of
the Features Proposed
Nem Yo,h Tribune

Washington Bltrcou
WASHINGTON, Aug. lS.-Thc ten
tative form of the bill ombodying the
provisions of the plan of the National
Association of Owners of Railroad Sc
curities (Warfield plan) for solution Of
the railroad problem has been outlined
before the House Committee on Inter
state and Foreign Commerce by Ford
ney Johnston. of advisory counsel for
the association. Each of the provisions
was explained to show the operation of
the plan.
Briefly stated the provisions of the
bill are as follows:
!. The Interstate Commerce Com
mission shall be directed by Congress
to maintain a level of rates in the diff
ferent ratemaking territories that shall
permit a return on the aggregate in
vestment of the carriers operating in
each of the three classification terri
tories of the country for not less than
per cent of such aggregate invest
ment.
This does not mean six per cent on
the investment of each individual car
rier." said Mr.. Johnston. ut means
on the aggregate investments; each in
dividual carrier will earn as much as
It's efficiency in operation will enable
1t to earn. The result will be that the
return on the individual property in
vestment IN some carriers may be two,
four. tve, or six per cent or more
Therefore, the incentive for efficient
operation and management is pre-
served"
How Excess Is Divided
.. Railroads earning more than six
per cent on the individual property in
vestment therein, shall. after retain
ing for their own purpose one third OF
the excess beyond six per cent have
the other two-thirds applied to the fol-
lowing purposes: One third III the in
terests of employees of the railroads op-
Grating in the territory in which the
railroads operate which earn such eX-
cess, and one-third to be devoted to
transportation facilities in the interest
of the public and shippers
3. Regional interstate commerce
commissions shall be established to act
IN coordination with the state commits
sions under such procedure as shall
be outlined by the Interstate Com
merce Commission. These regional
commissions shall be composed of three
members each, who shall be appointed
from the residents of the respective
districts and which shall correspond to
the SIX traffic territories into which the
interstate Commerce Commission has
divided the country. These eighteen
regional commissioners shall be ap-
pointed, nine from one of the political
parties and nine from the other. They
shall act as boards of conciliation in
questions of dispute between the en-
ployes and the railroads. with the right
OF appeal to the Interstate Commerce
Commission, the finding not to be com
pending the conclusion of the hearings
there must be no final action by either
party.
This provision" said Mr. Johnston
Will prevent strikes during the process
OF estigation"
Association to Rule
4. Provision shall be made for an
organization by act of Congress desio.
mated the National Railway Associa-
ton, which shall deal with Joint use
OF railroad facilities, adopt such meas
ures as shall have the effect of poolinp
OF traffic where desirable in the nnh
TIC interest; shall arrange for the diver
sion OF equipment from one road to
another where traffic congestion exists
ana "here such equipment may be used
10 the best advantage and IN the Dub
nc interest; to acquire eQuipmcnt in
the interest of any carrier which shall
piedge the credit of the purchase there
or to be leased to such carrier on fai,.
terms; to have control over the divi.
slohs or rates in the public interest and
as an equalizing force.
"Provision," Mr.. Johnston exn1a;naa
shall be made for the members of tha
interstate Commerce Commission. or
as many thereof as may be decided ~
be trustees of said organization ~
gether with representatives of tho ro;l
roads and the Railway Administrat;on /"
men in the various sections of ~
country. Under such prov;s;or '''o
means would be supplied of fnancin'
the present equipment allocated ,n c.',s
rlers during Federal control and v,h;nl,
is now IN contention between tho rail
roads and the railway administrator ,,
.. PROVISION for giving to the Inter
state Commerce Commission contro1
over interstate rates which cona;ct
win or burden the interstate rate
structure. ave
O. Provision to place under +bo
interstate Commerce Commiss;o,, t,,e
regulation OF future issues Of rail,ond ,.'d
securities. 0e'"
IL, Z. Provision for the permissive con-
solloation OF railroads in the public in
sta. WIN 'he consent of the Inter
a'e commerce Commission
o. PROVISION for the continuation of
.'e standard rental or return to the
a"liIoaus provided under the Federal
~on'ioi ~ act at the rate they are now
aeeeIVing until the Interstate Com
merce Commission can adjust the levol
Tho aot 70 meet the requirements of