The Washington herald., 1920-10-31
RAILWAY RATES
MAY REQUIRE
REIMBURSEMENT
September Net Income Too
Low to Provide 6 Per
Cent Returns.
OPERATIONS COST MORE
Question of Increase on Dr.
visional Charges Would
Be Decided.
OPERATIONS COST MORE.

Readjustment of practically all
the railroad rates in the country will
be necessary If the net operating
income of the railroads, as shown
by the returns for September, are
not more satisfactory during the re-
naming period of the year, it was
learned officially yesterday.
The net operating income for ap-
proximately one-half of the mileage
of the Glass A." or principal roads,
for the first month of the new rate
indicate a total of s3o.00o,o 600 less
than the monthly requirements of
the Cummins- Esch law which pro-
vides a return of per cent on the
capital invested.
Whether this readjustment would
occur through an advance in rates
in certain districts, or by a read
justment of railroad divisions will
have to be determined later.
Ninety Glass A roads, with a mile
age of 1l4.l9S.17 out of a total mile
age of 235,00O for this class of roads,
have now made their returns TO the
Interstate Commerce Commission.
Based upon them and contingent
upon the same ratio being main
tanned by the others, the Bureau OF
Railway Economics predicted that
the net operating income for all the
railroads will be $50, 5000 for Sep
tember. In arriving at this conclu-
sion the bureau based its estimates
upon reports from forty-five car
lrfa ha 1iStrirF
six in the Southern and eighteen in
the Western district.
Operating Revenues Larger.
The total operating revenue for
the ninety roads, reports showed
were S29S,36S.l0O, an increase Of
23.1S per cent over September, 1919
while operating expenses were
r2iS,25l, 0S6. an increase OF 27.s6 per
cent over September. 1919. The net
railway operating income for the
ninety roads amounted to s37,3s0,
COS. an increase of 1.OT per cent over
, ,September one year ago.
The total operating expenses for
the forty-six carriers in the East
ern district were S145, ,052, a gain
ber. while total operating expenses
EA-- OVSrSVhs on lAANA case -
S5.95 per cent, as compared with
September. 1919.
Notwithstanding these apparently
big figures the net income amounted
to only Sl6.323.95l. an increase OF
only go per cent. All the rest
was eaten up in increased wages
and other higher operating ex-
penses.
In the Southern district the total
operating revenues were S6S.O71,25l
an increase of 24.24; total operating
expenses were S5S,92O.3l5, an In
crease of 22.OS per cent, and the net
railway operating income was So
lOO.7l7, or an increase Of S3.O6 per
cent This is the best showing
made anywhere in the United States
Decreases in West.
The only actual decrease is shown
in the reports from the eighteen
Western District railroads. Their
total operating revenues amounted
. to $S4,6l2,797; total operating eX-
penses to $66,97l,464. and net oper-
ating income to $12.955,937, or a
decrease of 20.76 per cent.
Attention is called by the Bureau
, Of Railway Economics to the fact
, that subsequent returns during the
year may be modified by the fact
that a large amount of traffic in the
September account was hauled at
the old rate and that the final de-
cisions as to intrastate rates in sew
enteen States are yet to be made.
One thing. according to the Bu-
reau, however, is clear: The rail-
roads are not at present approach
ing earning figures that will carry
them over the six per cent mark
set tentatively by the commission as
reasonable return on property.