Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1920-05-05
FOR BIG ADVANCE
|NFR!E|GHT RATES
Commission Asked to Ratify In
crease to Bring Income Up
to Sum Required.
PASSENGER FARE is SAME
Net Income of Roads Fell From
$l,O56,000,000 in 1916 to
$5lO,00o,O0O Last Year.
PASSENGER FARE is SAME
IBy Arsociated rrc.t


wASHlNGTON, May i.-Thc ma
tion's railroads will need an addi-
tional Sl.Ol7. 200. 900 to bring their in
come TO the per cent basis provided
In the transportation act
Through the Association OF Rail-
way Executives the roads proposed
TO the Interstate Commerce Commits
sion today that this sum be realized
through Increased freight charges.
leaving the passenger rates at the
present level.
: The advances in freight rates pro-
posed were:
Eastern roads-3o.4 per cent to
yield an advance in all revenues OF
I'll per cent or s54I.0oo.000.
Southern -oads-3o.3 per cent to
provide ?0.7 per cent larger revenue.
Western roads-23.9 per cent 10 ad
vance all revenues IL per cent
Presentation OF the asurcs marked
the formal opening OF the railroad
rate case. While detailed statements
submitted to the commission today
covered only the Eastern lines. esti-
mates OF the needed increase OF the
Western and Southern groups accom-
panied the Initial suggestions upon
which the commission IL to determine
an entire new rate structure.
Willard Presents Figures.
The rate figures OF the Eastern
lines. embracing lii systems, term!-
nal and switching companies. were
laid before the commission by. Daniel
Willard, president of the Baltimore
npd Ohio and chs,rmap OF the execu-
t!ves' rate committee for the Easte n
territory. Similar Gstate,nentB.. .show
Ing the rcquirerents OF the Western
and Southern carriers, Will be sup
piled the commission In a fcw days
The analysis OF conditions. the re-
lationship of operating espenses and
revenues and the questions of re-
financing are largely the same in
each case. and the representations
OF the Eastern iines were said TO In
dicatc the questions with which the
commission will deal in establishing
the Western and Southern rates.
Net income OF all the country's
railroads fell from Sl,0is. s.000.0 900 in
1916 to 100000 ooO last year. the rail-
roads claim. while taeir investment
has Increased more than $4,000. .000.-
600. These figures were given to
serve as basis from which the com
mission could work in developing a
scale OF rates to meet the govern
ment guarantee.
An estimated valuation Of s2O.6l6,-
100000 was placed on the transporta-
tion systems OF the country by Mr.
willard. While there has bcan an in
crease in operating cxpenscs OF 93.l
per cent since 1916. the roads basis
OF revenues for tho same period has
been Increased only 36.31 per cent,
the executives statement declared,
and the operating expenses Of the
lines now are 90 per cent Of tho reve-
nues. as against 6s per cont In 1916
Burdens Forced by Roads.
This year and next, the Eastern
lines alone face the renewal of near
~ s25o,000.00O in maturing obliga-
tlons, Mr.. willard said. in discuss
ing the problem of financing the
roads. Some Of these loans and bonds
have been bearing an interest rate
as low as l-2 per cent. and Mr.. Will
lard declared that in taking care OF
this amount of obligations at the cur
lent rate Of interest neccssitated the
most CAREFUL STUDY OIL the revenue pro-
duction question in order that the
roads credit he kept unimpaired.
The carriers must now reassume
the burdens and risks of operation in
a period OF uncertain conditions af-
fecting business generally" Mr.. Will
lard said. THE demands for addi-
tional facilities and extensions wers
never so pressing rs now. The cost
OF new capital Is more than per cent
per annum even to those railroad
companies whose credit is the best.
victory loan bonds are selling cur
rently on basis of return in excess
OF per cent. New Industrial issues.
with which railroad financing must
compete, are Offering returns from
IL l-2 to per cent in addition to lib
erai commissions for their sale and
distribution. and underlying bonds Of
\ substantial railroads may be bought
| on q basis to yield per cent and In
some cases In excess of s per cent.
" further, the European markets,
! heretofore available for American
railroad Issues are now closed to us
and in fact are absorbing our surplus
FUNDS. and this applies not only to
Europe hut to practically the whole
world, including Japan and the
| East"