The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-04-19

LONG ISLAND ROAD
INCOME DECLINES
Operation Under Federal Con-
troll Shows Drop in Most
Departments.
-
REA TO MAKE APPEAL
Seeks More Compensation,
Calling Three Year Test
Plan Inequitable.
REA TO MAKE APPEAL

The pamphlet report OF the Long
Island Railroad Company giving re-
suits OF operation under Federal con-
ttol during 1913 shows that from the
total compensation OF 1921, 94S al
lowed the road, Of which only 100000
had been paid on December 81. the net
income after all charges was only
t773,544. or about s1.14 a share on the
s34,110.25o capital stock OF $50 par
value outstanding. This represents a
drop OF s95,755 In comparison with the
net income OF 1917. which was equiva-
lent to S255 a share on the capital
stock.
Income from sources other than
Federal compensation totalled s562,2e9.
making the gross income for the year
S3,1S4,247, decline of s57S.s35.
Charges from income totalled 5000
ga. decrease Of s4s3,21s, making the
net income for the period covered by
the report $773,914. A further deduc-
ton Of $3.50 for sinking fund and other
reserves brought the balance trans
ferred to profit and loss account to
s113,544. The total profit and loss sur
plus as Of December 81. 1918, was
36,543,17s, the report shows.
Following is a table Of the chief
features Of the income account with
the change from the report for 1917:
1913. Change.
Compensation accrued I'M
der Federal control, eI-
elusive Of any special
Other corporate income. So, 80 Inc. SIS rs
6.Suet ,HSS"e for ,elis. '"' pee''''''
losses, taxes, interest
charges, &c................ S01o,213 nec .4s5,2ls
sinking fund and other
Balance to profit and loss. 7s,5l4 Dec. rs 755
President Samuel Rea In his remarks
accompanying tho income account points
out the reasons for some OF the changes
apparent in the income statement
Report OF President Rea.
The increase in income from funded
securities" he says. 'is due chiefly to in
terest on Liberty bonds purchased, the
principal OF which Is reflected on the
vestments.' The increase In income from
unfunded securities and accounts arises
chiefly from interest on overdue and I'M
paid compensation due by the United
States Railroad Administration. The de-
crease in hxed charges and income de-
auctions Is due chiefly to a decrease Of
over $4,000 In rents for leased roads.
because the rental paid for New York
and RockawRy Beach Railway Company
far "a hA nj In
1918, which Is based on the Federal con-
troll contract: a decrease of almost S33.-
900 in miscellaneous rents resulting
largely from the cancellation of leases
and decrease Of more than $279, 900 In
interest on funded debt, which Ia due
principally to the rennancing by which
debenture bonds were exchanged for cap
ital stock, as explained in the annual re-
port for 1917; the retirement OF equip
ment trust obligations and second mort
gage per cent. bonds.
''The increase In interest on untunded
debt In chiefly on account OF interest on
amounts due the United States Railroad
Administra ton for settlement OF operat-
ing and other open accounts. The bal
ance of net income. &773.544.sO. was
credited to profit and loss and that ac-
count was charged with amounts repre-
senting business prior to January l
by the United States Railroad Admins
trat!on. and Ss24,ol4.bs. due principally
10 property abandoned on account OF Bay
Ridge improvement and Brooklyn grade
crossing improvement, the yearly charge
of 1000 on account of writing of At
lantic avenue leasehold estate and other
adjustments.
U. $. Agreement sim Unsigned.
An agreement with the Director
General of Railroads covering the pos
session. Use and control of the line'
OF your company had not yet been nego
tiated. The compensation payable II tn,
amount thereof is determined by thu
average annual railway operating In
come for the three year period, the so
called standard return, designated in tn,
Federal control act of Congress will
together with its other corporate In
come, be sufficient TO cover the com
pany's fixed charges taxes. rentals ant
other corporate expenses and to leave
small balance 10 the credit of profit an
loss account,
compensation based upon the stand
ard return would be clearly negotiable
because it would not secure for the com
pauy proper return upon the increase,
investment made by It during and afte
the three year test period ending Jun
so, 1917 for the enlargement and i'm
provement of your railroad betwee
Fresh Pond junction and Bay Ridg
and the terminal extensions at the latte
point to accommodate the traffic of tn
New York connecting railroad. whic
investment had materially increased tn
earning capacity and value OF the rail
road and property of your company. an
because the earning capacity OF tn
property Of your company, due to othe
causes. was materially greater at tn
time II was taken possession of by I'll
President than II had been in the thre
year period. II IL therefore the belle
of your board that the average ne
railway operating income for the thre
year test period is plainly inequitable q
fair measure of just compensation, an
a claim will be made for additional con
pensation as provided for under the Fec
eral control act.
1T Is not possible 10 include in III
report for 1918 the final results an
statistics corporations and MAINTENANCE
of your lines under Federal control bl
your company will later obtain such II
formation so as to preserve the COZ
tinuity of statistics and informatio
heretofore compiled"
Army Man Slainj Gun Near.
Gan. AHrroHIo Tax ApriI 30 la,,t