New-York tribune., 1921-11-24
Method of Selecting Body
to Run Lines Criticized
by |. r. T. Chief as Mix
ing Politics i'm Traction
Scent Fare Must
Suffice, He Says
Big Dividends Paid From
Swollen Receipts Blamed
for marlborough Plight

FRANK w. ueoley, president and gen.
eral manager of the Interborough
Rapid Transit Company. testifying yes
terday before the Transit Commission,
virtually indorsed the Commissions
plan of traction consolidation. His
only criticism was directed at the
formation of the proposed board of
control, to be composed of three mem
bers named by the Mayor, three by the
security holders of the unified system
and seventh to be elected by the two
groups or appointed by the Commission
In case of disagreement.
While agreeing that common owner
ship of the transit lines, coupled with q
pooling of all elements, presented the
best solution of the transit problem,
Mr. Hedley declared that the inclusion
on the board of control of appointees
named by an official body. whether the
Mayor or the Board of Estimate and
Apportionment. would react against the
interests of the community.
Hedley Suggests Plan
"I have no doubt the commission
is lahoring to eliminate both the pos
sibility of stock speculation and the
possibility of the transportation scheme
being used as political football" he
said, "but I do not know whether you
have accomplished this"
Mr.. Hedley's suggestion was that
the three members proposed to be
named by public authority be selected
by some such organization as the Bar
Association. The representation. he
said, should reflect the desires of the
public, the owners and the employees.
"Then," he added, "you have no
chance of having any secrets. You
have to lay all your cards on the table,
right side up. and that is my way of
doing business
The transit chief occupied the stand
during the entire day. His express
sions frequently caused merriment,
seeking a job under the proposed con-
solidation and that he had not looked
for a job since he began his railroad
career in 1885 as machinist on the
Manhattan '..L."
Mr.. Hedley frankly discussed the
condition of the Interborough, which.
she said, was striving to keep from 60
ing into bankruptcy, with the hope
that the tribunal sent down here"
would find relief for the situation.
Financial Record Disapproved
Disclaiming responsibility for the
financial affairs of the company prior
ic October, 1919, when he was ap-
pointed president. Mr.. .Hedley ex
pressed disapproval of the financial
methods that had been employed in
the past. He agreed that the payments
Of huge dividends from swollen reve-
nues were largely responsible for the
interborough's present stress, and that
the balance sheet of the company as of
June so, 1921, which has been under
fire, did not properly reveal the actual
financial condition.
Mr.. Hedley declared he did not be-
lieve in borrowing money to pay divi-
dends, as it was disclosed had been
done before he became president. He
said such course could not be pur-
sued to-day because the known CON
that he did not think anyone who had
money, outside of lunatic asylum,
would loan me a dollar"
IF dividends are paid during my ad-
mlnistration they will be paid only
from earnings" declared MIR. HedIey, in
stating that the company was pur-
SUNG q conservative policy different
from the past.
He defended the service of the COM
pany as being the best that could be
gwen with the money available, and
said that a five-cent fare was all he
expected to get for quite while"
Dividend Plan Explained
Several new phases dealing with the
action of the directors in declaring fat
dividends prior to 1919 we're touched
upon while Mr.. Hedley was on the
stand.
George McAneny, chairman of the
commission, inquired of the witness if
the lnterborough directors had not
taken advantage of the delays that fol-
lowed the postponement from 1917 to
1919 OF. the dnal plan of pooling reve-
hues with the city to dissipate their in
creased revenues for these years in
swollen revenues
Mr. Hediey gave a qualified answer
and Mr. McAneny went on:
because of the accidental postpone
ment of the date of pooling the COM
pany had these large funds in the
treasury, and instead of holding them
.or the exigencies of the future it pre-
erred to dissipate them before the
poollng commenced?"
Hedley. 'N' ''s'N'' -
: Declaring that men who had spent
nIe-tlme in the transportation husi-
CONTINUED on page .ix)