Albuquerque morning journal., 1919-03-12
PLAN DEVISED To
KEEP RAILROADS
FROM bANKRUP TCY
Former Congressman Shirley
Of Kentucky Is Appointed to
Succeed John Shelton VIII
IiamS as Finance Head,

lbf MONNlNe 1OoNNNL oFtSiNl ItNStu "'Nel
Washington, March 11.-Railroad
executives and government represen-
tatives today laid the foundation for
the machinery through which loans
of banks and the war finance cor
poration will be made available to
railroads during the next few montns
in lieue of the funds which congress
failed to provide.
After conferences between a num-
Der of leading railway corporation Of
ficers and officials of the war finance
corporation and railroad administra-
ton, a special finance committee of
seven headed by Howard Elliott, pres
ident of the Northern Pacific, was ere
ated by the railroad executives to CO.
operate with government agencies as
a clearing house for financial EAR
rangements.
ShcrIey Succeeds Williams.
Swagar Sherley of Louisville who
has just retired after serving sixteen
years in the house of representatives,
recently chairman of the house ap-
preparations committee, was appoint
ed by Director General Hines as di-
rector of the railroad administration S
division of finance, succeeding John
SHELTON Williams resigned. On Mr.
Sherley, who will take office April 15
will fall much of the work of admin
istering the financial plans yet to be
developed.
An important featu.e of the finan-
cial mechanics of the arrangements to
he made may be the issuance by the
railroad administration of government
warrants to railroads for the amounts
due them on settlements of last year S
accounts and other d BITS.
Serves as Collateral.
These warrants, virtually certifi-
Gates of Indebtedness, would not be
cashed until congress appropriates
funds at the next session, but would
serve as collateral for loans. The loans
would be arranged by each railroad
company individually with its bank
ers, or in special cases with the wal
finance corporation. The railway ex-
ecutives' special committee, together
with the railroad administrations fl
pancial agencies would facilitate the
negotiation and distribution of these
loans. Companies whose financia
strength was not great might be
helped by the railroad administration
which will get some funds through re-
| payment by railroads of advances al
| ready made to them.
Outlined by Hines.
These plans were outlined today by
| Director General Hines and the rail
way executives. but it was emphatized
| that final plans remain to be made
| Railroad administration and war fl
nance corporation officials will con-
| fer tomorrow with Secretary Glass
! of the treasury, and Thursday Mr.
Hines will discuss the financial situa-
[ ton with railroad car and locomotive
| builders and with the executives com.
mittee.
| Although no bankers participated
! directly in the conference today they
will be consulted informally by the
executive and railroad administration
officials. A number of prominen
bankers were here during the day tt
| confer privately with railroad heads
1t appears probable that the wal
finance corporation will try to limi
it's loans to railroad corporations witt
ample credit, without reference to tht
government warrants as collateral
| and every effort will be made by thu
government agencies to encourage
bankers to take un most of the loan
required. At the same time the rail
road administration will try to estab
lish a large degree of uniformity II
interest rates. This Will be facilitated
by tlfe potential resources of the wa
finance corporation.
Secretary Glass, at the conference
tomorrow. IS expected to emphasiz
the desire of the treasury to keel
railroad securities off the market un
til after the Victory Liberty loan
which probably will close May 10
This can be done through negotiating
short term bank loans.