New-York tribune., 1922-03-10
Experts Agree
Seats for All
Means Receiver
Officials of Interborough
and Transi: Board See
Financial Difficulties
in Improved Service
Hedley TO presen, Figures
Will Appear Before Commits
sion Wednesday to Explain
Valuation of Property

ApprecIable improvement in Inter
borough service-anything approximate
ing a seat for every passenger in the
non-rush hours-means a receivership ip
for the Interborough, according to we'll
informed officials Of the Interborough
company and Of the Transit Commits
sion.
Frank Hedey. general manager of
the Interborough. who is preparing for
the hearing before the commission next
Wednesday 10 inquire into the causes
of congestion. declined yesterday to
discuss the attitude of the company to-
ward the Transit Commission, which
insists that road earnings shall be
subordinated TO service, no matter what
they may mean to the operating COM
panics.
1t IS understood that if Mr.. Hedley
does not make his company's position
clear at the hearing on Wednesday he
viii bring It to the front on the fol
lowing Monday, when the commissions
valuations OF the transit lines will be
challenged by the companies.
Dispute on Valuation
The Jnterborough contends that the
Transit Commissions valuation Of its
properties is $26,000.000 too low The
Interborough holds its own valuation al
5000. 900 900, while the Transit Com
missions valuation in round numbers
is sl74, 900 00o
The transit situation has clarified
itself TO the extent that the Inter
borough is prepared to make represen-
tatiops to the commission that either
one OF two things Will force the com
pauy into a receivcrship.
One OF these considerations is an ap-
preciablc Improvement of the service.
involving the employment OF more
train crews and incidental costs. The
other is the continuance OF the Inter
borough's lease contract with the old
Manhattan Elevated Company whereby
the lnterborouSh pays Z per cent on
S60,000000, representing the boot,
valuation Of the Manhattan company.
These are the two main items con-
fronting the commission and the com
panies when they attempt TO work out
an improvement of the service. with
thc service costing the Interborough
what it does under its present fixed
charges.
When Mr.. Hcdley testified before the
Transit Commission on November 23,
1921, at which time the management of
the lnterborough was under fire. he
made several refereuces TO a possible
roceivership. He said the reduction of
- per cent in wages had been assented
. By the employees rather than run
he risk Of receivership.' This cut
meant a saving of 81 100000 year to
the marlborough. The company has
outstanding about s3S ,000,0GO on notes
which will mature in few weeks, and
- is not in position, according to those
cose to the management, to increase
its fixed charges. J. l.. Quackenbush.
counsel of the company, q. the Novem-
oer % hearing also had the $4,000, 00O
Manhattan company rental IN mind ap-
oerently. for when he was questioned
about changing the contract ne said:
Wants Owners TO Confer
III is one of the things Tat ha- got
- be very carefully considered by the
owners of the Manhattan stocks; in
fsct, the owners Of ali securities of al
the traction companies here should get
around the table, in my judgment and
see If they cannot agree with this com
mjssioN on some means OF putting this
thing or sound basis for everybody"
The Transit Commission is not in-
clined to force the company into
receivorship, which it is admitted
Yould involve it in expensive litiga-
zion. At the hearing on Wednesday
Chairman McAneny said that the 'scat-
for-every- passenger standard of serv-
ice for the uon-rusb hours WAS serv-
ice background that the company would
be compelled TO work up to as it's finan-
cal condition permits. lie made it
clear at the time that the commission
SIC not desire to preciptate a receiver
ship.