Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1920-08-05
NEW R. R. RATES
WILL NET HUGE sum
Increases in Freight, Passenger
and Pullman Rates Needed to
Meet Wage Advances Granted
Employees by Labor Board

washington, Aug. ]. tBy the Associated
Press. Rate increases granted the rail-
roads by the Interstate Commerce Com
mission are designed to give the carriers
an annual net operating income OF $1,134,-
100000. or s241 ,00O,O 900 more than the stand
ard return allowed by the government and
based on the average of the three year
period Immediately preceding federal con-
troll.
This sum is 1874, 100000 more than the
roads made in their record year of 1916.
but is 800, 600 900 less than the total of
81, E33, 100000 net operating income which
they sought in presenting their applica-
tons to the commission.
Rate experts of the carriers will set to
work tomorrow on the tremendous task
of preparing the new tarif schedules
which it is planned to file in time for the
increased ratc-freght, passenger and
pullman-to become effective September /.
On that date the government guarantee of
the standard return of $Sa3.oW.Wo annually
will expire under provision of the trans
portation act limiting this guarantee to
six months after the carriers were re-
turned to private control.
EXperts of the commission and the
carriers will also undertake to figure
the actual money return which Will &C
crue to the roads from the rate In
creases granted. which are about 81
per cent on freight rates, 20 per cent
on passenger. excess baggage and milk
rates and so per cent on charges tor
space in sleeping cars.
The actual increased amount to be
received by the roads as result Of the
! rate advances has been roughly es-
timated at $1,000, 100000 but until the
new tariffs are worked out and put
into operation the exact amount is
problematical With passenger fares
increased one-fifth and Pu M a n
charges advanced one-half passenger
travel probably will be reduced.
Based on the present passenger traffic
these increases are expected to yield the
roads a return of $277. O000 900, all of which
was sought to help absorb the wage ad-
vance to railroad workers which the rail-
road labor board has informed the COM
mission will work out at $618 ,0OO, O0O in
stead of the se0O, 100000 first estimated.
The carriers have figured the increase
! at $625, 900 900. but for the purposes OF the
rate case the commission used the board S
figures.
The estimated net operating income of
1134, 600, coo which the roads are to re-
ceive as result of the fare raises repre-
/ sents six pc rcent on the aggregate value
.
placed by the commission at SIS 100000 ooo
or 0.0O0O 900 less than the carriers es-
innate OF the total income received BY
the roads. one-half Of one per cent Of
the aggregate value, or 100000, must
be set aside annually for additions and
betterments.
Thus the actual net operating income
going into the treasury of the carriers
would he s1,o4o 900, 900. From this must hi
deducted taxes and other fixed expense:
not included in operating expenses before
the actual net income is determined. Ad'
mittedly taxes and most other of such
fixed expenses have increased since the
pre-war period on which the standard
government return is based.
Such intrastate rate increase, Mr.. Thon
said, will not add to the total income pro
vided for by the federal commission
decision because in submitting their esti
mates the carriers calculated on basis
of increases of both interstate and intra
state rates.
Applications to the State commissions
are now being prepared by the railroads
and it is expected that the railway ex'
ecutives that the increase will be grant
ed Should any state commission refuse
to authorize them, however. the carriers
Mr.. Thorn said will proceed under the
TRANSPORTATION act and ask nearing ne
fore the Interstate Commerce Commits
sion to determine whether the existing
interstate State rates are discriminatory
or preiudcial to interstate commerce.
Since the increases in passenger
Pullman, excess baggage and mill
rates were made general for the en-
tire country by the fedral commission
the railroads will ask for correspond
ing increases in each State. The pc
centage of advances in intrastat
freight rates which the roads will re
quest however will correspond to tn
per centage authorized in the territor,
in which the State is located. Thus in
creases requested in eastern States
would be 40 per cent, in southern
States 25 per cent; in western state
50 per cent and in mountain Pacifi
States % per cent,