New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-10-02
NEUTRALITY-SUSPICIOUS.
of Measures Will Bring
Drop of l0Points in the
Levy Rate for New York
Take S25O,0OO.O 900
From Debt Limit
Asserts Funds Would Be
Transferred From Non.
Interest : Earning Class

VIII Tesui from the adoption or tho
plan for the readiustment OF the city's
transit systems outlined on Thursday
by the Transit Commission.
This reduction would be gained
through the transfer from the non-in-
terest earning to the interest produe.
ing side Of the city's accounts ths
$25oou0,o0o invested by the city in the
dual subway system OF 1913. The re-
lease of this s250000,o on account q
subways from the city debt will make
way for the raising OF further funds
without encroaching upon the legal
debt limit of the city
George McAneny, chairman Of tha
commission. in discussing the releasa
of this s25o,oo0, 600 from the debt limit,
also said yesterday that there was nod
much fear Of the plan being held up
by court action, as threatened by Cor
poration Counsel John p. O'Brien.
Saves S5,ooo,oOo. Says McAneny
In the opinion OF Mr. McAneny, thu
release OF this $3.50, ,ooo,o 900 total from
the debt limit need not be deferred
until there is Ar actual payment Of in-
terest on the investment through the
profits TO be realized under the plan
of readjustment. When the plan has
reached d stage from which convincing
evidence can be produced that the es-
tablished rate OF fare viii guarantee
the payment of interest. judicial sane
ton for the removal Of the dual sub
ways Investment fyonl the debt limit
will be asked FOR.
In the budget for 1921 the item Of
interest on this Investment amounted
tc almost S9,60O,0O0. II is estimated
that next year the interest will amount
to more than Sl0,ooo,ooo City debts
producing interest are nos chargeabic
against the debt limit. and, in addition
to removing the total sum from thu
legal limit, there would be saving Of
not less than $5.oo0.00e IN taxes
Not Worried by Court Action
Concerning threatened litigation te
stop the progress of the plan, Mr.. Nc
Aneny said that the suit already fled
by the city to test the constitutionality
Of the transit law has reached the
Court of Appeals and will be argued In
December.
So far the constitutionality Of the
transit law has been upheld by eight
judges as the city's case passed up to
the Court OF Appeals. When the mat
ter came before the Appellate Division
that court said in effect that the Court
of Appeals already had held the transit
law to be constitutional, as the frameFs
of the law had based it upon various
decisions of the Court Of Appeals.
1t is not believed that the city can
Supreme Court. In the opinion of the
commission, it is not likely that ar
appeal to the highest court would he
granted. but should such an appeal
be obtained, it was said that the COM
mission would ask that it be dismissed
upon the ground that the matter vas
one for final decision by the state
courts.
No Opening for Stockholders
There is no opening, SO far as the
commission g aware, for suit agaiuss
its plan by stockholders. The choice is
offered to them Of accepting or reject
ing the plan, but if they reject they
must take their chances as TO the OUT
come.
Mr.. McAneny enumerated yesterday
The five taxes with which the transit
systems now are faced These arc:
Corporation and income taxes, paid to
the state; special franchise taxes, paid
TO the state; ordinary property taxes,
paid to the city; dividend taxes, paid
TO the state; tolls or bridge charges,
oa id to the city
MI McAneny was not prepared 10
say yesterday what the liability Of
The readjusted system you'd be as re-
CARDS the. state taxes. Tie CITY taxes.
however. would cease
TO clear up any possible 1nisunder-
standing, Mr. McAneny restated yes-
.erday the plan of Disbursements,
These, he said, viii pc:
l. Operating expenses.
:. Interest," on sinking fund and
'harges on the new securities. Of whic,
he amounts are even.
g. Depreciation in maintenance re-
serve.
4 The barometer fund" or surplus.
Division of. Surplus
A. the normal figure on five-cep.
are basis, an amount equal To 2 mar
,ent OF the capitalization would h.
livideo evenly between the bondhol6-
RS and the Operating personnel. the
a'tef TO take the form of pensions. in
'ufance or bonuses. Should the baron-
ter fund increase sufficiently to ne~-
MT reduction OF the fare To fo,,,
,ents, then this surplus would be even
Y divided on a four-cent basis. Wit
an increase of fare this a.xinau-o
mount decreases in the same ratio
'ntH the point IS reached where there
7ould be no surplus available for dis
'rinltion. The bondhoders have
however, of 5 per cent
eturn.
Regrouping of Lines Planned
Brooklyn travellers who have been
accosted by seemingly impertinert
persons who ask whence they came.
whittier they are going and at what
ran Ter points they expect to change
heir course are asked by the commits
'ion 10 answer patiently. The com.
MISSION IS making an Intensive ia-
spection' of the operation OF the lines
@ gather data FOR a regrouping and
he bringing Of disintegrated lines int,
orderly systems. These inspectors ask
where passengers got on the car or
rain, where they are going, and where
hey will transfer
No Willingness Was shown by trac.
ion men Yesterday 70 discuss critically
,he commissions plan. Ii is yet too
'ocn, they said. to have thoroughly d.
rested the plan. Statements a re- prorN~