Evening star. [volume] (Washington, D.C.) 1854-1972, 1940-09-09
Improved Position
.f Old Colony Line
Cited al Hearing
Massachusetts Official
Denies Road Would
Burden New Haven
Hv the Assnciated press.

j. Burke Sullivan, assistant attor-
ney general of Massachusetts,, con-
tended today operations of the Old
Colony Railroad would not create
any loss to the New Haven Railroad
System if it were included in the
New Haven reorganization.
Sullivan's contention, disputed by
counsel for the Old Colony and for
the New Haven, was made at a new
hearing before the Interstate Com
merce Commission in the New York,
New Haven & Hartford Railroad re-
organization proceeding to deter
mine whether to include the Old
>Golony in the reorganized New
Haven system.
Prior to a reduction in service
made last spring by Old Colony the
railroad had been operating at a
loss of $4,000 annually, Sullivan
declared. But, he said, the service
reduction had saved $4,000 year
which he commended gave the line
100000 on the profit side.
Freight Gains Seen.
Under questioning by Sullivan
Charles F. Galley, transportation
analyst for the trustees of the New
Haven Railroad, testified that the
freight business for the Old Colony
had improved in the last three or
four months, but he was unable to
estimate the amount of improve
ment. Sullivan commended that the
Old Colony's losses had been caused
by passenger service in its Boston
group of properties, many of which
we're eliminated last spring.
If the Old Colony was part of
the New Haven system" Sullivan
aid, there would be no loss from
. 'assenger operation in the Boston
roup at present"
In its New haven reorganization
Ian issued several months ago the
c. c. made no provision for in
[ fusion of the Old Colony and this
roused much opposition in MasSa-
,lusetts.
After receiving numerous formal |
objections, the I. c. c. agreed to !
reopen the proceeding to receive |
violence in support of and opposi-
ton to the inclusion of provision |
for reorganization of the Old Col
Ony" in the plan of reorganization |
Of the New Haven.
The Old Colony Commuters & |
Shippers League summed up the |
position of Massachusetts interests |
when it asked the commission for
disapproval of any plan Of reorgani- |
zation for the New Haven unless
it contains provision for merger of |
the Old Colony with the New Ha-
Yen."
Favor I. c. C. Plan.
Major BODYBUILDING groups, in
Guiding the insurance group, hold
ing S55,718,000 of New Haven Sc
curities, have expressed themselves
in favor of the I. C. C.'s original
plan. The insurance group said it
was against permitting the reor-
,ganization of the New Haven proper
to be held UP by the complication
and delays which are necessarily |
involved by any attempt to reorgan-
ize the Old Colony at the same |
time. .., 81. -.
The Old Colony itself has asked to
be included in the reorganized New
haven and has advanced various
suggestions, including abandonment |
Of its so-caned Boston group of |
properties, Abandonment of the |
Boston group is opposed by Massa-
chusetts interests,
Massachusetts interests contend |
hat many economies have taken |.
place in the Old Colony since pre-
"ious hearings which would permit |
the New Haven to take it over with
cut financial burden.
The New Ravens position is that !
it is willing provided it involves no |
great burden.
Commission Divided.
The question of whether to in
clude the Old Colony in the reor-
canized New Haven has divided the
l. c. c.
A majority said in the New Haven
reorganization plan that lit is re-
vgretted that the existing situation
of the Old Colony is such that it
would be contrary to the public in
terest and the interests Of the prin-
cipal debtors New HaVens) credi-
tors to authorize the acquisition of |
the Old Colony properties at this |
time. or to approve a plan of reor- |
ganization at this time for the Old
Colony"
Chairman Joseph B. Eastman
urged deferment of any reorganiza-
ton plan until new evidence had
been received regarding the pros
pective earning power and value
TO the New Haven of the Old Colony
properties.
The commission designated Oliver
T.. Sweet director of its Finance