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sion, a statement of reasons in favor of which appeared in the ninth annual report of the Commission. Among the points which in the view of the national convention should be embodied in a law are the following:
First, it should provide for the appointment of railroad examiners by , the Interstate Commerce Commission, and so define the duties of said examiners as to insure the keeping of the books of corporations subject. to the act to regulate commerce according to the principles and rules laid down by the Commission.
Second, it should prescribe that annual and monthly reports should be filed with the Interstate Commerce Commission, which reports should be passed upon by the examiners, and in case of discovery of abuses, such use should be made of the reports as may lead to appropriate legal remedies.
Third, it should provide for the establishment of a bureau of statistics and accounts, under the direction of and in connection with the Interstate Commerce Commission; and give to the Commission the right to prornulgate through this bureau rules and regulations according to which accounts should be kept by the corporations subject to the act, to the end that the last clause of the twentieth section of the act to regulate commerce may be made effective.
INCOME AND EXPENDITURES OF RAILWAYS FOR THE YEAR ENDING :
JUNE 30, 1897.
The preliminary report on the income accounts of railways in the United States for the year ending June 30, 1897, prepared in the statistician's office and contained in Appendix E, serves to show in a concise manner the results of the operations of the railways for the last fiscal year. It should be observed that the figures in this report are compiled from the annual reports of operating railways for the year, which were filed between July 1 and November 30, and since the figures have been taken as returned, for the most part without examination or revision, they may in some cases differ somewhat from the final figures which will be accepted for the complete report of railway statistics for the year. This qualification, however, should not materially affect the summarized results which are derived from this advance report, which presents in tabular form the principal items of the income accounts of 743 railways, representing an operated mileage on June 30, 1897, of 180,027.65 miles, or about 97 per cent of the operated mileage in the United States.
The total gross earnings of the mileage given for the year ending June 30, 1897, were $1,116,613,254, of which $314,859,516 were from passenger service and $773,598,253 were from freight service. The operating expenses for the same period were $747,562,398, leaving the net carnings $369,050,856. In addition to this last amount the railways received $34,166.656 as income from sources other than opera
tion, chiefly from investments, inaking their total income $403,217,512. The total deductions from income, embracing in the phrase interest on funded debt, rents for leased lines, taxes (which amounted to $40,979,933), and other charges against income, were $347,339,332. The dividends declared by the companies covered by the report aggregated: $57,290,579. The combination of the foregoing figures results, in showing a deficit from operation of $1,412,399 for the year ending June 30, 1997.
It should be noted that the amount of dividends stated does not represent the total amount of dividends declared by all of the railway companies, since this preliminary report does not include returns for any lines operated under lease or other agreement, for which only financial accounts are maintained. The total amount of dividends declared for the year ending June 30, 1896, including those of subsidiary lines, was $87,603,371, the dividends of the operating lines being substantially the same for the two years.
For the purpose of comparison, the items of operation are reduced to a mileage basis. It thus appears that the earnings from passenger service were $1,749 per mile of line operated. The corresponding average for the year ending June 30, 1896, was $1,816 per mile of line. The earnings from freight service were $4,297 per mile of line, showing a decrease of $47, as compared with the previous year. The other carnings from operation, including inclassified earnings, amounted to $156 per mile of line. It follows, therefore, that the total gross earnings from operation of the railways, as a whole; reduced to a mileage basis, averaged $6,202 per mile of line, showing a decrease of $118, as compared with the year ending June 30, 1896, for which the average was $6,320 per mile of line. The operating expenses also show a decrease, being $96 less per mile of line than for the preceding year, when they were $4,248 per mile of line. The income from operation-that is, the amount of gross earnings remaining after the deduction of operating expenses—was $2,050 per mile of line. The corresponding figures for the fiscal year ending June 30, 1896, were $2,072 per mile of line, or $22 greater.
The data in the preliminary report are presented in the same form as last year for the United States as a whole, and also for ten territorial groups into which the country is divided, in order that the statistics may be localized to a considerable extent.
DIFFICULTY IN OBTAINING STATISTICAL REPORTS.
Attention is once more called to the difficulty in obtaining statistical reports from railroad companies. The delay which attends the issuing of its volume of statistics by the Commission is severely criticised, and that criticism would be just if the information out of which the volume is compiled could be seasonably obtaired. From the very nature of the case a large part of the work in the preparation of that compilation can not be undertaken until the reports are all in. The requirement now is that these reports shall be filed by September 15, for the year ending the previous June 30, and most of the larger companies file their reports substantially within the time. Many of the companies do not, however, and there is no efficacious way by which they can be compelled to do so. The whole number of reports embraced in the last volume was 1,421. Of these 426 were filed on or before September 15. November 1, 306 were still outstanding, and January 1, 1897, 138 were yet to be made. The last report included in the volume was not received until May 20, 1897.
Observation and inquiry lead to the conclusion that the time for filing these reports should be extended to September 30, of each year, and that the railroads can easily make the required returns within that time, except in peculiar and unusual instances.
A report when filed is seldom complete, and much annoyance is occasioned by the failure of carriers to answer questions in explanation. All this occasions not only delay but a great amount of expense, since letter after letter is frequently written to which no reply whatever is vouchsafed.
The manifest remedy is to impose some suitable pecuniary penalty for failure to make returns within the law. Such a measure is but justico to the carriers who do report promptly, and would increase greatly the value of the work which the Commission aims to accomplish in this field.
One other suggestion should be made in connection with this section. The statute now provides that any carrier subject to the act may be required to make the necessary report. A great many of these reports must be made by railroad companies who are not now operating their own lines, and some question is made whether a company not in the operation of its line is a carrier subject to the provisions of the act. At the same time these reports, which do not refer to the operation of the road, are necessary to make the statistics when furnished in any. wise complete.
The form of the twentieth section given among the amendments at the end of this report is in accordance with these suggestions.
CONSTRUCTION, PUBLICATION, AND FILING OF TARIFFS. The pamphlet issued by the Commission December 1, 1891, entitled “Methods of Carriers and Requirements of the Act to Regulate Commerce in the Matter of Construction, Publication, and Filing of Rate Schedules, and distributed to the traffic officials of carriers subject to the act, was intended to show clearly the irregularities and deficiencies in tariffs and rate sheets as they were filed at that time, and to indicate the changes deemed necessary to secure compliance with the law in that regard.
While there has been a marked improvement in the construction of
tariffs since the publication of this pamphlet, there are still many schedules filed which are defective in various ways, and fall far short of the requirements of the statute.
A much larger proportion of the tariffs now published and filed are regularly printed than at any previous time since the organization of the Commission. Practically the only other method at present in use is printing by typewriter, and reproduction by what is known as the "mimeograph” process. This method is used to a considerable extent in some parts of the country, especially in the South and West. While some of the tariffs made by this process are practically perfect, so far as printing is concerned, many of them are poorly printed, and in some cases so defective that it becomes necessary to return them to the carriers for more legible copies.
One of the most common defects in tariffs as now published is the failure to plainly state the places from, to, or between which the rates therein named apply. For many years it has been customary with carriers in publishing tariffs to important points, such as Chicago, Boston, New York, etc., which are also made to apply at other points taking same rates, to make them read “To Chicago and Common Points,” « To Boston and Common Points, etc. In some cases the tariffs contain a list of the points taking same rates as Chicago, Boston, or New York, as the case may be, but in the majority of instances the tariffs do not contain a list of the points or inake reference to any schedule in which such points may be found. Railway agents of long experience may know in each case what points are intended to be covered by the tariff, or at least where such points may be found, but such a tariff would bo of little use to the general public, and probably has no legal value except as to the rates from and to the points actually named thereiv. During the last two years this matter las been taken up with the carriers by correspondence, and considerable improvement has resulted therefrom.
Schedules are also frequently defective on account of the vague and incomplete manner in which their application is stated, and the confusion is often intensified by the frequent modification of the tariffs by means of amendments, supplements, and advance notices to supplements, these sometimes reaching into the hundreds, so that it is often extremely difficult for even one accustomed to the use of tariffs to determine accurately the rate on a given article between given points.
The statute clearly contemplates that the posted schedules of rates, fares, and charges shall contain all necessary information, so that a shipper may determine for himself the total charges between given points. Tariffs are frequently defective in this respect. Circulars or other independent issues are often made by carriers, providing for minimum or maximum car-load weight, or other rules or regulations which affect the rates to be charged on certain traffic, but making no reference to the tariffs in connection with which they are intended to apply.
The law seems to require that each class-rate tariff shall contain the classification governing the same; but as reprinting the classification with each class tariff would be very burdensome, it has been considered a substantial compliance with the statute when the classification is posted and filed separately and proper reference made thereto on the tariffs.
Nearly all carriers, however, have exceptions to the general classification governing the tariff, which are intended to be used in connection therewith. These exceptions are usually separate issues which make no reference to the tariffs in connection with which they are intended to apply. Nor do the tariffs in most cases make reference to the exception sheets. This matter has also been made the subject of correspondence with carriers, with beneficial results.
The opinion of the Commission “In the matter of the Forin and Con. tents of Rate Schedules, and the Authority for Making and Filing Joint Tariffs,” dated September 8, 1894, among other comments relative to the publication of routes, contains the following:
For tho present, however, the publication of routes will not be exacted by a definite and unqualified order, though we may rightfully expect that this informa-. tion will be given in future joint tariffs, unless conditions exist which fairly excuse a relaxation of the rule.
While there has been considerable improvement in tariffs in this respect since the publication of the opinion referred to, there are many tariffs now being filed that fail to show the routes of the traffic carried thereunder, and this is often the case where there is no apparent reason for such failure.
It is believed that there are comparatively few joint tariffs issued by individual carriers that could not be so arranged as to show the routing of traffic without adding materially to the expense of the tariff.
The order of the Commission dated January 15, 1896, relative to the uniform numbering of rate schedules, among other things provides: “Schedules which cancel or amend previous issues shall in all cases refer specifically to the Interstate Commerce Commission numbers of the schedules affected thereby.”
This requirement has been quite generally observed by carriers, tariffs issued since the promulgation of this order in most cases inaking proper reference to the tariffs canceled or amended thereby, and record made in this office accordingly, so that since the date mentioned there is little difficulty in determining what tariffs are in effect. Prior to that date, however, in a great many instances, the new tariffs did not refer specifically to the tariffs canceled or superseded thereby, and proper record of cancellation could not therefore be made, the result being that there is a large number of tariffs in the files of the Commission, issued prior to 1896, which are apparently in effect but which without doubt have long since been superseded by later issues. It is true that it is a common understanding among carriers that the last