Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-02-24
RAIL MERGER BILL
IS REPORTED OUT.
Explanation Given Senate by
FeSs of Detailed ConSoIi-
dalton Plans.
By the Associated Press.


Legislation designed to facilitate
widespread railroad consolidation was
reported favorahly to the Senate yester-
day at the end OF week during which
some of the country's most important
rail interests have advanced specific
plans in the same field to the Interstate
Commerce Commission.
Senator Fess, Republican, Ohio, act
ing for the majority of the Senate in
terstate commerce committee, presented
a consolidation bill with a detailed ex-
PLANTATION of its purpose and the statute
notifications it contemplates.
Though the text Of the measure made
no reference to the individual console
dations, pending, all OF its terms have
intimate association with the series Of
enterprises now formally launched
which look to the creation Of giant rail
mergers. some of them planned on q
scale loaing to the fusion of IS or 20
stable transportation systems in one
management unit.
FrOposai Dy ID. ~ ".
The latest and perhaps the largest Of
these proposals was submitted to the
Interstate Commerce Commission only
three days ago, one by the Baltimore &
Ohio system, which asked approval for
the acquisition of nearly 5000 miles Of
additional line. The other consolidation
proposal was submitted by the Van
Sweringen interests Of Cleveland, who
asked the right to build out of rail
properties they now control and others
they hope to buy new Eastern trunk
line, with $4,000 miles of track.
Though these projects affect only the
Northeastern quarter of the country.
there is already awaiting the commits
sion's final word. the Professionally COM
pleted merger of the Northern Paci-
flc and Great Northern systems, in the
Northwest, whose joint control Of the
Burlington system, reaching southwark
to the Mexican Gulf, would put $4,000
miles of road in single merger.
Senator Tess report explained that
the bill was designed to facilitate such
unidcation Of rail systems by merger,
financial control, or corporate CONSOLE
cation as might be deemed in the public
interest by the Interstate Commerce
Commission. The bill repeats the sane
ton of former statutes even for the
consolidation Of parallel and competing
railroads" which was once forbidden py
antitrust legislation. ~
Minority Owners Considered.
The measure also proposed methods
o. satisfying minority stockholders op-
posing consultations, and it also would
direct the Interstate Commerce Com
mission to make plans for a general |
railroad merger. The bill further would
extend provisions for tax exemption in
security operations undertaken to bring
about approved mergers. and generally
would seek to facilitate the process ad.
vocated.
Though Congress extended the first
permission for rail- consolidation In 1920,
only minor mergers of operating lines
have taken place in the ensuing nine
years. The grouping attempted by O. |
z and d. J. Van sweringen of Cleve-
land, centering around the Chesapeake |
d. Ohio, Erie, and Nickel Plate sys- |
TENS, has been only partially and con- |
ditionally approved by the Interstate |
Commerce Commission, although the |
Chesapeake & Ohio has been given |
authority to take over the Pere Mar |
quette system.
The program Of L. F, Loree. for
merging the Kansas City Southern. |
Missouri and st. Louis |
Southwestern met with fiat rejection |
from the commission, as did the pro-
poSal Of the Norfolk e. western to
lease the Virginian system. The Nor
them Pacific Great Northern merger
is awaiting a decision, but approval is
not expected by all observers of the |
proceedings.
Only one or two actual mergings of
rail systems have been successful in
running the gantlet Of opposition to
obtain a commission approval since
1920, and these practically all amount
to the closer indications Of operating
units already related by financed and
management to each other. Several
paper projects have been set UP for |
discussion, but little has been actually
accomplished.