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Individual Applications: Astor, William Vincent, application to hold the
position of director of the Delaware & H. R. Corp. while holding the positions of
director of the Great Northern Ry. Co. and the Illinois Central R. Co., denied.
In re Astor, 528.

DIVIDENDS

In General: The issue of bonds as a dividend is not compatible with the
public interest. Charleston & W. C. Ry. Co. Bonds, 309 (312).

Capitalizable assets and assets that cannot properly be so classified under a
State statute and the accounting requirements of the Commission constitute a
part of a carrier's stated capital that cannot be diminished by the payment of
dividends. Chicago, M., St. P. & P. R. Co. Bonds, 725 (729).

A new company organized to take over the assets of another corporation should
be permitted to set up on its books as its stated capital only the capitalizable
assets as representing the contribution of the holders of no-par stock to fixed
capital, treating the remainder of the assets contributed as capital surplus to
be used for any legitimate corporate purpose other than the payment of divi-
dends, and the accounting requirements of the Commission might well be modi-
fied to authorize such accounting. Id. (730).

DIVISIONS OF RATES

If and when a situation arises under which traffic is diverted from one system
because of unduly preferential divisions accorded another system, the matter
may be corrected in an appropriate proceeding under sec. 15 (6) of the Act.
Fort Benning R. Co. Acquisition, 223 (228).

EARNINGS

In General: Increase in assets should result in increased earning power.
Charleston & W. C. Ry. Co. Bonds, 309 (312).

The Commission must consider the earning power of an applicant in approving
loans from the Reconstruction Finance Corporation. Bartlett W. Ry. Recon-
struction Loan, 550 (551).

Individual Applications: St. Louis Southwestern Ry. Co. of Texas, applica-
tion for permission to retain excess earnings derived from operation over Dallas
Term. Ry. & Union Depot Co., dismissed, inasmuch as sec. 15a (18) was repealed
by the Emergency Railroad Transportation Act, 1933. St. Louis S. W. Ry. Co.
of Texas Operation, 441 (442).

EQUIPMENT-TRUST CERTIFICATES. See SECURITIES (EXCHANGE)

EVIDENCE

Matters not of record are not treated as evidence. Tri-State Teleph. & Teleg.
Co. Control, 383 (390).

EXCESS INCOME. See EARNINGS

EXCHANGE OF SECURITIES. See SECURITIES (EXCHANGE)

EXTENSION OF LINES. See CONVENIENCE AND NECESSITY (EXtension of
LINES)

EXTENSION OF MATURITY DATE. See SECURITIES (MATURITIES AND
RETIREMENTS)

FEDERAL CONTROL

DEFICITS UNDER SECTION 204 OF TRANSPORTATION ACT, 1920: The following
carriers are not entitled to deficit benefits: Christie & E. Ry. Co., 469; Rio Grande
Ry. Co., 473.

GUARANTY UNDER SECTION 209 OF TRANSPORTATION ACT, 1920: Minnesota,
Dakota & Western Ry. Co., found to be a carrier within the meaning of sub-
division (a) of sec. 209 of the Transportation Act, 1920. Amount necessary to
make good the guaranty under that section ascertained and final settlement
made. Minnesota, D. & W. Ry. Co. Guaranty Settlement, 685.

FEDERAL EMERGENCY ADMINISTRATION OF PUBLIC WORKS
LOANS. See LOANS TO CARRIERS

FINAL SETTLEMENTS. See FEDERAL CONTROL
GUARANTY TO CARRIERS.

See FEDERAL CONTROL (GUARANTY)

INCOME DEBENTURES. See SECURITIES (DEBENTURES)
INDUSTRIAL LINES

Individual Applications: Fort Benning R. Co., facilities may have the
physical aspect of a plant facility, but circumstances of their purpose and owner-
ship clearly distinguish them from industrially controlled and operated railroad
properties in the application of regulatory policies. Fort Benning R. Co.
Acquisition, 223 (227).

INTEREST.

(NOTES)

See also SECURITIES (ASSUMPTION OF OBLIGATION AND LIABILITY)

In General: Carriers in default of fixed interest obligations are ineligible to
become parties to the marshaling and distributing plan, 1931. Louisiana S. Ry.
Co. Reconstruction Loan, 1 (2).

Individual Applications: Middletown & Unionville R. Co., application to
reduce interest of first-mortgage 20-year 6 percent bonds to 5 percent and adjust-
ment-mortgage 6 percent bonds to 4 percent, granted upon conditions.
town & U. R. Co. Bonds, 588.

INTERIM CERTIFICATES. See SECURITIES (INTERIM CERTIFICATES)
INTERLOCKING DIRECTORS. See DIRECTORS

INTERSTATE COMMERCE

Middle-

Companies which do not operate in interstate commerce are not subject to
regulation under the Act, and bonds issued under their mortgages are not
subject to the jurisdiction of the Commission. Chicago, R. I. & P. Ry. Co.
Reconstruction Loan, 259 (261).

JOINT OPERATION.

OPERATION)

See CONVENIENCE AND NECESSITY (ACQUISITION AND

JURISDICTION. See particular subjects of jurisdiction under appropriate
headings

LEASE. See CONTROL

LIABILITIES AND OBLIGATIONS. See SECURITIES (ASSUMPTION OF
OBLIGATION AND LIABILITY)

LOANS TO CARRIERS

In General: Under the terms of the Reconstruction Finance Corporation
Act, the Commission is required to find that the Corporation will be adequately
secured in making loans to railroads, and approval for the purpose of construction
must be founded on the demonstrated soundness of the enterprise at the time of
the decision. Waco, B., T. & S. Ry. Co. and Receiver Reconstruction Loan, 168
(180-181).

Recognizing a comprehensive change in the conditions upon which the Com-
mission's finding in 1927, authorizing extension of lines, was based, and the fact
that it is now proposed to use Government money and not private capital for
carrying out the plan, the issuance of the certificate in 1927 cannot be invoked
as a reason for approving a loan from the Reconstruction Finance Corporation.
Id. (181).

Under the terms of the Emergency Transportation Act, 1933, the Commission
may not approve an application for a loan from the Reconstruction Finance
Corporation if it is of the opinion that the carrier is in need of financial reorgani-
zation in the public interest. Chicago & N. W. Ry. Co. Reconstruction Loan,
370 (373); Meridian & B. R. Ry. Co. Reconstruction Loan, 506 (507); Sumpter
Valley Ry. Co. Reconstruction Loan, 572 (575).

The Commission cannot approve a loan to the trustee of a railroad for the
purpose of establishing a working fund to meet unspecified items of expense.
Meridian & B. R. Ry. Co. Reconstruction Loan, 506 (509).

The Commission's responsibilities under the Reconstruction Finance Corpora-
tion Act extend beyond the mere distribution of funds. It must consider also
the earning power of the applicant. Bartlett W. Ry. Reconstruction Loan,
550 (551).

The Commission's action in granting authority to construct a railroad, while
evidencing its willingness at a time of industrial activity to waive the doubts
inherent in a proposition to bring into production new coal areas in favor of the
optimism of those who were willing to back their judgment by their capital,
should not later be construed as a reason for authorizing the expenditures of
Government funds for that purpose, when the promoters are unwilling or unable
to carry out their undertaking. Ozark & P. V. R. Co. Reconstruction Loan,
583 (587).

Individual Applications: Applications of the following carriers or trustees
involving loans from the Federal Emergency Administration of Public Works,
approved: Chicago & E. I. Ry. Co. Trustee Public Works Improvement, 789;
Chicago & N. W. Ry. Co. Public Works Improvement, 787; Chicago, M., St. P.
& P. R. Co. Public Works Improvement, 783; Pittsburgh & W. V. Ry. Co.
Public Works Improvement, 785.

Applications of the following carriers or receivers for loans from the Recon-
struction Finance Corporation, approved. Terms prescribed: Chicago & N. W.
Ry. Co. Reconstruction Loan, 370; Erie R. Co. Reconstruction Loan, 46; Great
Northern Ry. Co. Reconstruction Loan, 211; Southern Pac. Co. Reconstruction
Loan, 55; 63; Sumpter Valley Ry. Co. Reconstruction Loan, 572; Wabash Ry. Co.
Receivers Reconstruction Loan, 15.

Applications of the following carriers for a loan from the Reconstruction Finance
Corporation, denied: Albright & B. R. Co. Reconstruction Loan, 79; Ann Arbor
R. Co. Receivers Reconstruction Loan, 127; Coos Bay S. Ry. Co. Reconstruction
Loan, 300; Hillsboro & N. E. Ry. Co. Reconstruction Loan, 323; Louisiana S.
Ry. Co. Reconstruction Loan, 1; Marshall, E. F. & S. E. Ry. Co. Reconstruction
Loan, 133; Ozark & P. V. R. Co. Reconstruction Loan, 583; Santa Fe, S. J. &
N. R. Receiver Reconstruction Loan, 545.

Upon further consideration or supplemental applications, conditional approval
of loans modified in the following cases: Chicago & N. W. Ry. Co. Reconstruction
Loan, 489; Florida East Coast Ry. Co. Reconstruction Loan, 495; Meridian &
B. R. Ry. Co. Reconstruction Loan, 677; Southern Pac. Co. Reconstruction
Loan, 601.

Bartlett Western Ry., upon reconsideration of application for a loan from the
Reconstruction Finance Corporation, previous decision, in 187 I. C. C. 479, deny-
ing approval of the loan, affirmed. Bartlett W. Ry. Reconstruction Loan, 550.
Birmingham & Southeastern R. Co., previous report, 184 I. C. C. 419, modified
to approve diversion of funds loaned. Birmingham & S. E. R. Co. Reconstruction
Loan, 316.

Chicago, North Shore & Milwaukee R. Co., upon further consideration of
application for a loan from the Reconstruction Finance Corporation, previous
decision, 189 I. C. C. 765, denying approval of the loan, affirmed. Chicago, N. S.
& M. R. Co. Receivers Reconstruction Loan, 167.

Chicago, Rock Island & Pacific Ry. Co., substitution of collateral for a loan
from the Reconstruction Finance Corporation, approved. Previous reports, 184
I. C. C. 597; 735. Chicago, R. I. & P. Ry. Co. Reconstruction Loan, 259.

Denver & Rio Grande Western R. Co., upon application, report and certificate,
189 I. C. C. 674, approving a loan by the Reconstruction Finance Corporation
modified so as to reduce the amount of the loan. Denver & R. G. W. R. Co.
Reconstruction Loan, 209.

Gainesville Midland Ry., upon further consideration of the application of the
receivers of, for a loan from the Reconstruction Finance Corporation and con-
sideration of the joint supplemental application of the receivers and the railway,
approval of loan denied and certificate canceled. Previous report, 189 I. C. C. 15.
Gainesville Midland Ry. Receivers Reconstruction Loan, 136.

Georgia & Florida R., upon supplemental application, modifications of terms
for loans from the Reconstruction Finance Corporation for the receivers, approved.
Previous reports, 184 I. C. C. 332; 731. Georgia & F. R. Receivers Reconstruction
Loan, 139.

Meridian & Bigbee River Ry. Co., application of trustee for a loan from the
Reconstruction Finance Corporation, approved in part and previous certificates
approving loan from the Corporation to the Meridian & B. R. Ry. Co., canceled.
Former reports, 184 I. C. C. 371; 187 I. C. C. 127; and 189 I. C. C. 345. Meridian
& B. R. Ry. Co. Reconstruction Loan, 506.

St. Louis-Kansas City Short Line R. Co., application for a loan from the Recon-
struction Finance Corporation, dismissed. Applicant is not qualified for a lean
under provisions of sec. 5 of the Reconstruction Finance Corporation Act, as
amended. St. Louis-K. C. S. L. R. Co. Reconstruction Loan, 141.

Waco, Beaumont, Trinity & Sabine Ry. Co. and Receiver, upon further con-
sideration of application for a loan from the Reconstruction Finance Corporation
for the purpose of constructing extensions, previous decision, 187 I. C. C. 275,
denying approval of a loan, affirmed despite the fact that the extensions had been
authorized in 1927. Waco, B., T. & S. Ry. Co. and Receiver Reconstruction
Loan, 168.

ΜΑΙΝΤΕΝANCE

In General: Rail wear, generally speaking, is governed by the amount of
traffic passing over it, and traffic conditions over a period of years may be accepted
as a fair index of rail requirements for the same road or system. Chicago, M.,
St. P. & P. R. Co. Public Works Improvement, 783 (784).

MATURITIES AND RETIREMENTS. See SECURITIES (MATURITIES AND
RETIREMENTS)

MERGER. See CONSOLIDATION OF RAILWAYS

MOTOR CARRIERS

In General: The Commission has no jurisdiction over bus transportation.
Unification of Lines in Southern New Jersey, 183 (198).

NEW LINES. See CONVENIENCE AND NECESSITY (NEW LINES)

NOTES. See SECURITIES (NOTES)

OBLIGATION AND LIABILITY. See SECURITIES (ASSUMPTION OF OBLIGA-
TION AND LIABILITY)

OPERATION. See CONVENIENCE AND NECESSITY (ACQUISITION AND OPERA-
TION)

PASSENGER STATIONS. See TERMINALS

PUBLIC CONVENIENCE AND NECESSITY. See CONVENIENCE AND
NECESSITY

PUBLIC INTEREST

The issue of bonds as a dividend is not compatible with the public interest.
Charleston & W. C. Ry. Co. Bonds, 309 (312).

A simplification of the ownership of the larger railway systems, including
properties of various corporate ownership, is clearly in the public interest and is
one of the purposes of legislation. Rock Island System Consolidation, 395
(397).

The transportation needs of a community must be weighed against the burden
that the cost of rehabilitation, maintenance, and operation would impose upon
interstate commerce, and the point at which abandonment shall be considered
justifiable is a matter of sound judgment, and must be determined by the cir-
cumstances of each case. Texas & G. Ry. Co. Abandonment, 474 (480).

In authorizing an individual to serve as officer or director of more than one
carrier it is not enough to say that the Commission can see no harm in what is
proposed, it is essential that it be able to say beyond doubt that neither public
nor private interests will suffer. In re Astor, 528 (529).

It is not necessary that every existing board of directors must be brought into
conformity with the principle that an officer or director shall not hold positions
with other carriers without authorization of the Commission, but corrections
should be made as and when shown to be in the public interest and conformity
observed when new applications are presented. Id. (530).

RECEIVER'S CERTIFICATES. See SECURITIES (RECEIVER'S CERTIFICATES)
RECONSTRUCTION FINANCE CORPORATION LOANS. See LOANS
TO CARRIERS

RENEWAL OF SECURITIES. See SECURITIES (NOTES) (RECEIVER'S CER-
TIFICATES)

REORGANIZATION

In General: Under the terms of the Emergency Railroad Transportation
Act, 1933, the Commission may not approve an application for a loan from the
Reconstruction Finance Corporation if it is of the opinion that the carrier is in
need of financial reorganization in the public interest. Chicago & N. W. Ry. Co.
Reconstruction Loan, 370 (373); Meridian & B. R. Ry. Co. Reconstruction
Loan, 506 (507); Sumpter Valley Ry. Co. Reconstruction Loan, 572 (575).
RETIREMENTS AND MATURITIES. See SECURITIES (MATURITIES AND
RETIREMENTS)

ROUTES. See also ROUTING.

Baltimore & Ohio R. Co., authorized to file tariffs canceling certain routes
covered by condition in original report, 158 I. C. C. 779. Buffalo, R. & P. Ry.
Co. Control, 557.

ROUTING. See also ROUTES.

If and when a situation arises under which traffic is diverted from one system
because of unduly preferential divisions accorded another system, the matter
may be corrected in an appropriate proceeding under sec. 15 (6) of the Act.
Fort Benning R. Co. Acquisition, 223 (228).
SECURITIES

In General: In dealing with capitalization consisting entirely of securities
having a par value, the par value of common stock represents a contribution by
the stockholders for investment in capitalizable assets. Chicago, M., St. P. &
P. R. Co. Bonds, 725 (727).

Where a carrier seeks to issue securities to capitalize expenditures for additions
and betterments, the Commission must first determine whether the applicant's
capitalizable assets as a whole will exceed its capital liabilities, after the proposed
issue.

(Id. 727).

ASSUMPTION OF OBLIGATION AND LIABILITY: Individual Applications:
Chicago & Eastern Illinois Ry. Co., of first and refunding mortgage bonds, series
C, of Chicago & W. I. R. Co., granted. Chicago & W. I. R. Co. Bonds, 565.

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