Indiana daily times. [volume] (Indianapolis [Ind.]) 1914-1922, 1921-02-10
LOCAL SHARE
IN OWNERSHIP
RAIL SOLUTION
Home Financing Urged to
Better Attitude Toward
Electric Lines.

CHICAGO. Feb. 1O-Local financing
Of electric railways was advocated today
by S. B. Way, vice president OF the
Milwaukee Electric Railway and Light
Company. as one of the best solutions
Of the industry's present-day problems.
Mr.. Way spoke before the mid-year con-
ference ofthe American Electric Railway
Association.
"Such a happy means Of financing Is
Of course, ideal" Mr.. Way said.
each community were financially self
sustaining and II each street railway
were owned by its patrons, being In
fact 8 cooperative enterprise, there would
be universal satisfaction or service anu
universal acquiescence In rate Oh rare
that approach the actual cost OF service.
Local financing. however, has not al
WAYS been possible, because of the large
amount of money that it requires to
build an electric railway line, and also
because growing communities always are
in debt, Mr.. Way pointed out
BETTER LOCAL
UNDERSTANDING.
Better local understanding Of the
econimics of the business, which may be
promoted by seIf-lnterest in its success"
he said. carries with it better public
relations and has, In cases. made I'M
scrupulous attacks by the issue seeking
politician actually unpopular. A suni-
cientIy wide distribution among the trac-
ton company's patrons should form a
more logical basis of public ownership
than municipal ownership. The advan'
tage of experimenting general financing
plans through local financing, thus in
creasing the amount of money raised,
must not be lost sight of and mention
may be made Of the desirability from the
traction cOmpany's standpoint OF any is
sue of securities which does not carry
restrictions which may be burdensome
when the company is again required to
resort to its credit.
1.-THE disadvantages. Il there are any,
arise from efforts necessary to the mall
tenance of good reputation, adequate pub
licity OF the compsny's business and the
restricted ability Of local investors to alb
sorb securities"
Mr.. Way strongly recommended news
paper advertising as one channel through
which sales can be developed. He par
ticularly urged that all advertisements
be told in simple language, and that
technical and financial terms be avoided.
He also strongly recommended the
across the counter" sale Of securities.
MUST ACCORD
EARNING POWER.
The public, in its own selfish interest.
If for no other reason, must accord pub
lie utilities the earning power to enable
them to function properly. said F. K.
Shrader of Chicago In discussing Pres
ent Requirements for Mortgage Sc
curities."
In touching upon service-at-cost fran
chises, he said that, while the underly-
ing principle Of the cOst-of- service or
flexible fare franchise is without any
doubt economically correct, IN practice it
has not yet, so far as am aware, meas
ured fully up to expectations from a
credit standpoint. The goal toward
which the industry must strive is regu-
lation, practically automatic in Its oper-
alton and sufficiently responsive TO
promptly administer adequate relief in
periods of high costs and thus enable
the corporation to maintain unimpaired
its earning power and credit. The pub
lie must come to recognize that the util-
fly business is essentially public bust
ness. and for the welfare Of the pubic
Itself II must be accorded the earning
power to enable It to function properly
ADDITION OF a service at-cOst plan or Op-
Grafton, with municipal financial aid as
a solution Of the electric railway prob
lem. was advocated by Melvin A Tray
lor, president of the First Trust and
Savings Bank, Chicago.
In reference to his suggestion Of mu-
nicipal aid for electric lines he said that
good transportation development means
better housing conditions and consequent
higher standards Of citizenship.