Audubon Republican. [volume] (Audubon, Iowa) 1894-1925, 1920-08-05
RAILROADS To GET
A BIG INCREASE
OVER TWO MILLION MORE THAN
THE STANDARD RETURN AL
LOWED BY GOVERNMENT

haJo Increases q idnltu the Idii'
roads by the interstate commerce
commission are designed to give car
riers an annual net operating income
OF $1,234,OO0,000, or $241,00O,0OO
more than the standard return al
lowed by the government.
This is S34,000,0OO more than the
roads made in the record year OF
1915, but is $99,000,000 less than
the $1,233,0O0,000 net operating in
come they sought.
Rate experts will begin at once
preparing the new tariff schedules II
is planned to file in time for the in
creased rates-freight, passenger
and Pullman-to become effective
September LIST. Then the govern
ment guarantee of the stanrard re-
turn of $S93,O00,00O annually will
expire.
Experts also will undertake to
figure the actual money return to
accrue from the increases, which
are about percent on freight, 20
percent on passenger, excess bag
gage and milk rates, and 80 percent
on charges for space in sleeping and
parlor cars.
The actual increase to the roads
has been estimated at s1,50O,000
600, but at present the exact amount
is problematical. With passenger
and pullman charges advanced trav-
ell probably will be reduced.
Based on passenger traffic, the in
creases are expected to yield $277,-
100000, all of which was sought to
help absorb the wage advance to the
railroad workers, which the railroad
labor board figured would total
100000. The carriers have
figured the increase at $625,00O,O0O
The estimated net operating in.
come of $1,134,000,O00, the roads
are to receive, represents percent
on the aggregate value of their pro.
perties, which was placed by the
commission at $18,900,0O0,00O, OF
$1,140,000,000 less than the car
riers estimate. OF the total income
received, one-half Of one percent. OF
$94,00O,080, must be set aside annu
ally for additions and betterments
Thus the actual net operating
income would be $1,040,000,000.
From this must be deducted taxes
and other fixed expenses not includ
ed in operating expenses before the
actual net income Is determined.
Should the increase produce mor'
| than the six percent return, one-hal
of the excess would, under the
! transportation act, be placed in tn,
roads reserve fund and the othel
half would be turned over to the in
| terstate commerce commission to es
tablish a revolving fund for max
ing loans to the carriers, or for pur
chasing equipment to be leased t
| them.
The estimated ne. income to be re
ceived by the three groups of road
is fixed at percent of the valuation
| placed on these groups by the com
mission. On a valuation of IS,
100000 eastern roads would &c
$528,OOO,O0O.
The valuation of all the western
roads is placed at 900
They would receive the estimated
operating income of $4S6,000,000
against the $537,S00,000 sought
The standard return they are nov
receiving is $401,000,O00.
Southern roads were valued BY
the commission at $2,000,00O,000 81
their net operating income would b,
$120,0O0,000.
Advances of intrastate rates
freight, passenger and Putnam,
correspond with the interstate In
cveases authorized by the interstat,
| commerce commission will be asked
| Of state railway commissioners, 4
was stated by Alfred p. Thorn, gen
eral counsel for the Association o.
Railway Executives.
Such intrastate rate increases, Mr.
Thorn said. will not add to the in
missions decision because in sub
hitting their estimates the carriers
calculated on a basis of increases o.
both intrastate and interstate rates
Applications to the state commits
sions are being prepared and rail
way executives expect the increase
will be granted. Should any state
commission refuse to authorize then
| the carriers, he said. will proceed
under the transportation act, and
ask hearing before the interstate
| commerce commission to determin,
whether the intrastate rates are dis
criminatory or prejudicial to inter
state commerce.
Since the rate increases granted
were made general by the fedora
commission, the railroads will ash
for a corresponding increase in each
state. The percentage of advances
sought in intrastate freight rates
however, will correspond to the per.
centages authorized in the territory
in which the state Is located. Thus
increases requested in eastern states
would be 40 percent: in southern