Federal Valuation of the Railroads in the United States
| Published date | 01 January 1916 |
| DOI | 10.1177/000271621606300116 |
| Date | 01 January 1916 |
| Author | Thomas W. Hulme |
| Subject Matter | Articles |
182
FEDERAL
VALUATION
OF
THE
RAILROADS
IN
THE
UNITED
STATES
BY
THOMAS
W.
HULME,
General
Secretary,
Presidents’
Conference
Committee.
The
United
States
Supreme
Court
has
repeatedly
held that
in
the
regulation
of
rates
the
common
carrier
is
entitled
to
earn
a
return
upon
the
value
of
the
ptoperty
employed
by
it
in
the
public
service,
and
is
not
limited
to
the
original
cost
thereof
or
the
amount
the
carrier
has
invested
therein.
The
Interstate
Commerce
Com-
mission
in
its
first
annual
report
and
frequently
since
has
recom-
mended
that
steps
should
be
taken
to
ascertain
the
value
of
the
railroads;
such
information
being
deemed
essential:
To
obtain
a
trustworthy
estimate
of
the
relation
existing
between
the
present
worth
of
railroad
property
and
its
cost
to
its
proprietors;
In
determining
whether
rates
as
fixed
by
the
government
are
confiscatory;
In connection
with
railway
taxation;
In
the
ascertainment
of
a
proper
depreciation
reserve;
In
testing
the
accuracy
of
the
balance
sheets
of
the
carriers;
To
the
organization
of
railway
statistics
in
general;
In
determining
whether
the
railroads
are
under
or
over-capitalized
In
1910
Congress
had
under
consideration
a
bill
to
regulate
the
issuance
of
securities
of
railroad
companies,
but
instead
of
taking
action
authorized
the
appointment
of
a
commission
to
study
and
report
with
reference
thereto.
The
commission,
headed
by
Pres-
ident
Arthur
T.
Hadley
of
Yale
University,
advised
in
its
report
submitted
in
1911
against
such
legislation
pending
a
valuation
of
the
property
used
in
interstate
commerce;
the
report
was
probably
most
influential
in
causing
the
passage
of
the
Valuation
Act
ap-
proved
March
1,
1913.
The
act
as
passed
was
very
different
from
and
was
a
devel-
opment
of
a
bill
providing
for
the
valuation
of
the
physical
property
of
the
railroad
companies.
As
such
it
was
known
as
a
bill
&dquo;pro-
viding
for
physical
valuation,&dquo;
and
passed
the
House
of
Repre-
sentatives
in
that
form,
but
underwent
a
radical
change
in
the
hands
of
the
Senate
sub-committee,
providing
as
reported,
for
the
ascertainment
of
the
value
of
all
of
the
property
of
a
carrier
including
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