The daily Gate City and constitution-Democrat. (Keokuk, Iowa) 1916-1922, 1919-03-26
AGREE UPON
FINANCE PLAN
War Finance Cooperation 10 Make
Direct Loans TO Railroads
Until consrsss Makes
AppropristIona.

! limited Press Leased Wire Services.
WASHINGTON, March 26.-Plaus
for financing the railroads under
federal control until congress apprc-
PIRATES sufficient funds for capital ex-
genditEreS have been agreed upon
between the war finance corporation.
the railway administration and the
individual roads.
I The war finance corporation will
make direct loans to the railroads.
Eugene Meyer, Jr.. managing direc-
tor Of the corporation announced to-
day.
The war finance corporation al
ready has begun filing applications
for advances from the individual
roads TO meet their april first re-
qgirements, Meyer said The rail-
roads are offering as collateral 10
their own notes. certificates Of tn
debtedness issued 20 them By the
railroad administration.
To date the war finance corpora
ton has loaned s11s,000.000 to the
roads. This SUM includes s5O, 900 800
which was advanced TO the railroad
administration.
The policy Of lending money TO
i GkiLOclS RLOFA0rG AAA
the act under which the war finance
corporation operates" Meyer said
The policy. therefore, which Is
now being pursued n loanfng funds
for the operation OF the roads, il
entirely in line with the original in
tention of congress as expressed by
Tie statute and also In line with the
settled procedure Of the war finance
corporation through the course Of It's
brief history. The number Of appli-
cations from railroads for advances
OF course will bs greatly augmented
by the failure OF congress to provide
the appropriation asked by the direc-
tor general Just before the adjourn
ment Of congress-
Officials OF corporation declared
that with the certificates OF the rail-
road administration attached TO the
collateral these notes Of the
railroads could be turned over to prf-
waite financial institutions later If
necessary. But for the present, It
was said, the war finance corpora
ton viii hold the security for the
loans itself.
1t was believed here that the agree
uaent which provides funds for the
railroads will go long way toward
of serious trouble in the
financial world. The locomotive, car
and equipment companies already
have provided ways for obtaining the
due them from the railroad
administration This amount to about
$40, 100000.
The railroad administration has
given the equipment companies trade
acceptances which the manufacturers
may rediscount at federal reserve
banks, thus turning funds into hands
Of manufacturers Immediately.
Director Hines recently stated the
railroad administration would require
s701, 6sT 900 TO finance it's needs to
June 90. By separate agreements
with the locomotive, car and qeuip-
ment companies, this figure is re-
duced to 1891 10000 The war
finance corporation has loaned the
railroad administration $50, 200, 900
which viii bring cash balance in
hands Of federal treasurers up to
: 200, 900, 900, which is the normal
working cash capital for one month.
The war finance corporation, there
fore, probably VIII be called upon to
loan approximately 100000, 900 to
the various roads.
However. II was pointed out, this
figure may be increased as condi-
tons change or 1t may be lowered If
the amount Of traffic to be handled
by the railroads increases, thus pro-
viding more revenue.