The evening world., 1920-05-19
B. R. I. MYSTERYCO.
PAYSDIVIDENDSOF
+. 47OP. c. A YEAR
Rockefeller a Piker" Says
Riegelmann as Figures Are
Read at Car Inquiry.


~
The Transit Development Gem
pany. q b. r. t. business corporation
which does not mako report TO the
Public Service Commission. has paid
RS,7sLOOO dividends. or 1922 per cent.
tor sixteen yeafs on a capitalization
Of $50, 900. or an average Of more than
47O per cent a year during its cor
porats exlsbonoe. according to the
testimony Of wood d. 1,oudOun, Dep
uty Commissioned Of Accounts, at the
inquiry into tho Brooklyn traction
companies to-day. The witness also
said that the report OF the b. II. T.
finances made bySStone q Webster,
accountants, under the direction Of
Federal Judge Mayer. which was 70
have been tho basis OF an application
for increased fares, has alone cost
$lls,5iLs3, Of which $4,000 is charged
70 receivership expenses and the ball
ance OF tS6,5l4.B9 debited to audited
vouchers of Feb. 70, 1920. ..a
Il think Rockefeller. was a piker,"
doolSred Edward RiegeImann. Brook
lyn President, whom these figures
wore read. ,...
Tho Transit Development Co, de-
scribed by Corporation Counsel Cars
well as tho mystery company" was
organized in 1909 with n capital Of
$4,000. subsequently, increased in 1907
TO $4,000, owned entirely by the d. r.
T. for handling real estate, manu-
featuring and selling power.
In February, 1907. Commissioner
LOudoun said, the several companies
Of tho B. II. I. entered into an agree
ment with the Transit Development
Company whereby they leased 10 tho
latter their power houses and plants
TO supply electric power to tho B. II.
I. at tho cost plus per cent, com
m1lted ON a car mileage basis, subse-
quently changed to per cent. and
per cent. per annum TO cost OF
power houses. This agreement CON
tinued in force until the Transit De-
velopment Company was merged with
the b. r, T. in 1918. -
The Transit Development Comnanv
furnished power to tho BROOKLYN trac-
tion lines from 1907 until July. I9t8
and It's gross operating revenue In
that period. said Commissioner Iou-
doun. was $97,461,B456s The gross in
come was S17,767,2O74l But by n pro-
cess characterized as financial Jug
glery &12o64,7ss.75. represented by in
terest on loans and certificates (held
by the b. r T) has been deducted
from the gross income, thus reducing
by bookkeeping method the net in
come to $5,7O2, 1896.
The surplus at the end Of the period
was still further reduced to $751;
1883, after payment OF dividends to
the B. II. T, ana appropriations
amounting TO S3,O61, 1879, and a
debit and credit adjustment to sur
plus profit and loss of $S,2S2 5s7.sy.
In these debit and credit adjustments
TO surplus profit and loss Gin addition
to a depreciation reserve OF $685.
962T6) there Is an item OF Especial
Reserve 100000" which no one knows
to what II relates. The accounting
officer OF the company says It was
made before hts regime and the
records do not disclose to what 1t re-
lates.
The gross corporate income from
1888 TO 1918 amounted to S72, 4S9, ,32,
the witness said. After deducting
I34, ,SOS, ,47s.5S, represented by interest
on loans, certifcatessof Indebtedness,
ON receivers certificates and amor
tizauon, a net corporate income re-
mained of SS7, sos, ,O2O79, After the
payment OF O,O22, ,33l5O in dividends
and other adjustments. profit and
loss surplus OF $l2,S7ASfS.23 was
shown. This 329,OOOOOO in dividends
J (belng 4S 1-2 per cent OF capitaliza-
tion) was paid from 1909 to 1918 a 1-2
to per cent. a year,. The dividends
ceased in 1918 because OF agreement
with bankers forbidding dividends so
long as sixty millions In loans then
made continued outstanding.
The B. II. r., continued Loudoun,
received in dividends and profits
from the operation OF the companies
In It's system, from 1898 20 1919, S2a
Sll,959.6i. In addition the B. IT. r
benefited in loans pade on certin-
Gates OF indebtedness at per cent OF
$S5,?95, ,467.6l covering its subsidiaries
Certificates OF Indebtedness out
standing on Dec. 81, 1919, amount t.
SS6,4si,2S ,2S4.O2 distributed among tho
subsidiaries. Entries in certain early
records OF the assets Of the y. X. r
were inflated 10 such an extent that
i Is a question whether there is
l%S'4'sia2S OF tangible value in The
balance, tho witness ASSERTED