Oak Street UNCLASSIFIED 1 FINDINGS OF FACTS THE RAILROAD COMMISSION OP WASHINGTON RELATIVE TO THE V^LUA-TIOlsr OF THE 0. R. & N. RAILWAY SYSTEM IN THE STATE OF WASHINGTON OLYMPIA, WASH : E. L. Boardman, Public Printer, 1909. FINDINGS OF FACTS THE RAILROAD COMMISSION OP WASHINGTON RELATIVE TO THE VALUATION OF THE 0. R. & N. RAILWAY SYSTEM IN THE STATE OF WASHINGTON OLYMPIA, WASH: E. L. Boardman, Public Printer, 1909. Digitized by the Internet Archive in 2017 with funding from University of Illinois Urbana-Champaign Alternates https://archive.org/details/findingsoffactsbOOrail In the Matter of Ascertaining the Values of the Railroads in the State of Washington. THE RAILROAD COMMISSION OF WASHINGTON, ] Complainant. The Northern Pacific Railway Company, a corpora- tion; The Great Northern Railway Company, a corpora- tion; The Oregon Railroad & Navigation Company, a cor- poration ; The Washington & Columbia River Railway Com- pany, a corporation; The Port Townsend Southern Railroad Company, a corporation; The Columbia River & Northern Railway Company, a corporation; The Columbia & Red Mountain Railway Company, a corporation; The Washington & Great Northern Railway Com- pany, a corporation; The Spokane Falls & Northern Railway Company, a corporation; The Washington, Idaho & Montana Railway Com- pany, a corporation; V The Columbia & Puget Sound Railroad Company, a corporation; The North Yakima & Valley Railway Company, a corporation. The Bellingham Bay & British Columbia Railroad Company, a corporation; The Tacoma Eastern Railroad Company, a corpor- ation. The llwaco Railway & Navigation Company, a cor- poration. The Seattle & Montana Railway Company, a cor- poration; The St. Paul, Minneapolis & Manitoba Railway Com- pany, a corporation; N. The Washington Central Railway Company, a cor- ^ poration ; The Columbia & Palouse Railroad Company, a cor- poration. The Walla Walla & Columbia River Railroad Com- pany, a corporation; and The Snake River Valley Railroad Company, a cor- poration, Defendants. J FINDINGS OF FACT. 4 RAILROAD COMMISSION OF WASHINGTON THIS CAUSE coming on regularly to be heard before the RAIL- ROAD COMMISSION OF WASHINGTON, after notice duly given to the defendants above named and each of them, upon the complaint filed herein, for the purpose of ascertaining the facts provided for in section 5, chapter 226 of the session laws of Washington for the year 1907; to-wit: The facts bearing upon the cost and value of the railroad property of the representative railroads in the state, as more fully appears by said complaint; the Commission appearing by all the Commissioners and by A. J. Falknor, Assistant Attorney General, as counsel for the Commission; the Northern Pacific Rail- way Company appearing by B. S. Grosscup, its attorney; the Great Northern Railway Company appearing by M. J. Gordon, its attorney; the Oregon Railroad & Navigation Company » appearing by A. C. Spencer, its attorney; the Tacoma Eastern Railway Company ap- pearing by E. M. Hayden, its attorney; the Bellingham Bay & British Columbia Railroad Company appearing by C. W. Howard, its attorney; the Spokane Falls & Northern Railway Company appearing by M. J. Gordon, its attorney; the Port Townsend Southern Railroad Company appearing by B. S. Grosscup, its attorney; the Washington & Columbia River Railway Company appearing by B. S. Grosscup, its attorney; the Columbia & Northern Railway Company appearing by M. J. Gordon, its attorney; the Columbia & Red Mountain Railway Company appearing by M. J. Gordon, its attorney; the Washington & Great Northern Railway Company by M. J. Gordon, its attorney; the Washington, Idaho & Montana Railway Company appearing by M. J. Gordon, its attorney; the Columbia & Puget Sound Railroad Company appearing by W .B. Stratton, its attorney; the North Yakima & Valley Railway Company appearing by Ira P. Englehart, its attorney; the II- waco Railway & Navigation Company appearing by A. C. Spencer, its attorney; the Seattle & Montana Railway Company appearing by M. J. Gordon, its attorney; the St. Paul, Minneapolis & Manitoba Railway Company appearing by M .J. Gordon, its attorney; the Washington Central Railway Company appearing by B. S. Grosscup, its attorney; the Columbia & Palouse Railway Company appearing by A. C. Spencer, its attorney; the Walla Walla & Columbia River Railroad Company appearing by A. C. Spencer, its attorney; the Snake River Valley Railroad Company appearing by A. C. Spencer, its attorney; all parties having announced themselves ready for trial, the evidence having been from time to time introduced on behalf of the complainant, the Railroad Commission of Washington; and evidence having been introduced by and on behalf of each of the respective railroads as to the cost of construction, reproduction and present value, volume of traffic passing over the line, and the cause having been duly argued and submitted to the Commission concerning the cost of construction, reproduction and present value, and it being expressely stipulated by and between the respective parties hereto that the Commission should make and render its findings of fact upon the cost of construction. FINDINGS APPLICABLE TO O. R. & N. CO. 5 the cost of reproduction and the physical values of the properties of said railroad companies, and each of them, before attempting to divide the value of the use to which the^ respective properties were severally put in the conduct of intrastate and interstate business respectively, and it being expressely stipulated by and between the parties hereto, that the cause is continued for the taking of further testimony as to the value of the use to which said several properties are put in the conduct of intrastate and interstate business, respec- tively, and the Commission being fully advised in the premises does now make and render upon the questions so submitted, the following findings of fact: FINDINGS OF FACT APPLICABLE TO THE OREGON RAILROAD & NAVIGATION COMPANY. Finding No. 1. That the Oregon Railroad & Navigation Company is a corporation organized and existing under and by virtue of the laws of the state of Oregon and is the owner and is engaged in operating a line or lines of railroad extending through Oregon, Washington and into Idaho and is engaged as a common carrier in the carriage of freight and passengers for hire. That said road owns and operates 882.34 miles, 262.21 miles of which is within the state of Washington. That in addition thereto the said road operates the Columbia & Palouse Railroad, having a mileage of 144.80 miles, 142.44 miles of which is within the state of Washington; the Walla Walla & Columbia River Railroad, having a mileage of 35.52 miles, 3Q.18 miles of which is within the state of Washington; the Snake River Valley Railroad, with a mileage of 65.85 miles, all of which is within the state of Washington; the Columbia & Southern Railroad Company, with a mileage of 69.46 miles, and the Columbia River & Oregon Central Railroad Company, with a mileage of 45.31 miles — no portion of said last two mentioned lines being within the state of Washington. The said railway company, in conjunction with the Northern Pa- cific Railway Company, operate the Northern Pacific Terminal Com- pany under lease, having a mileage of 2.54 miles, none of which is in the state of Washington. Making a total mileage operated by said road of 1,245.82 miles, 500.68 miles of which is within the state of Washington. That the main line of said road within the state of Washington extends from the Oregon-Washington boundary line near the Columbia river north- erly to Spokane, with numerous branch lines connected therewith, some of which branch lines extend into the state of Idaho, and the main line of the said O. R. & N. Co. extends from a point near the Washington-Oregon boundary westerly to Portland, Oregon, and east- erly to Huntington, Oregon. That in the year 1893 the lines of the Oregon Railway & Naviga- tion Company defaulted in the payment of their fixed charges and a receiver for the said lines was appointed and the said lines re- mained in the hands of a receiver until August 17, 1896, when said corporation was reorganized under the name of the Oregon Railroad 6 RAILROAD COMMISSION OF WASHINGTON & Navigation Company, the holders of the outstanding bonds sur- rendering the same and accepting in lieu mortgage bonds of the reorganized company, and said property was purchased at foreclosure sale by the Oregon Railroad & Navigation Company. That a more detailed statement of the capitalization of said com- pany is hereinafter set out. No. 2. That that portion of the main track and main line of the Oregon Railroad & Navigation Company extending from the Oregon-Wash- ington boundary, near the Columbia river to Wallula, and consisting of 6.1 miles, was constructed by the Oregon Railway & Navigation Company about the year 1881; that in the construction of said line, in its present condition, exclusive of the sums chargeable to better- ments and improvements, the Oregon Railway & Navigation Com- pany expended the sum of $190,928.39, and that there has been charged to betterments and improvements on said line the sum of $18,605.07, making a total expenditure on said portion of said line as shown by the records and books of said company, amounting to the sum of $209,533.46. That in order to reproduce the grading of said road in its present condition it would be necessary to move 48,562 cubic yards of earth a distance of not to exceed 300 feet, 31,105 cubic yards of solid rock a distance of not to exceed 300 feet, and of the quantities above mentioned it would be necessary to move an equivalent 25,240 cubic yards a distance of 100 feet in excess of the 300 feet free haul allowance. It would be necessary to place 1,838 cubic yards of riprap. That to produce the bridges, trestles and culverts of said line it would be necessary to construct 64 lineal feet of pile bridges, and steel truss bridge No. 221, as now existing across the Walla Walla river, said bridge being a through Pratt truss, 175 feet in length, containing two concrete abuttments necessitating an excavation above water of 239.5 cubic yards, of 43.4 cubic yards below water, the placing of 3.56 cubic yards of cut stone and 282.5 cubic yards of concrete masonry requiring 418,542 pounds of steel and 178 lineal feet of floor system, 759 feet board measure of lumber in wooden boxes, 30 cubic yards of stone masonry in culverts, 60 feet of 24-inch cast-iron pipe. That subsequent to the construction there has been 6,231 cubic yards of earth used in filling bridges and trestles, which is not included in the grading quantities mentioned above; that to reproduce said lines it would be necessary to lay 24,003 ties; 917.10 tons of steel rails, the same requiring 116,936 pounds of rail splices; 12,295 pounds of bolts, 51,528 pounds of spikes, 13,710 light tee plates, 1,520 rail braces and 1,100 pounds of nut locks. Tnat for the purpose of ascertaining the cost of reroduction it is estimated that to reproduce new the frogs and switches on the line would cost in place the sum of $2,312. That to reproduce the ballast on the said lines it would be necessary to ballast with earth 6.1 miles, which for the purpose of ascertaining the cost of reproduction is estimated to cost $600 per mile. FINDINGS APPLICABLE TO O. R. & N. CO. That to reproduce the line it would be necessary to lay 8.34 miles of track, which for the purpose of ascertaining the cost of repro- duction is estimated to cost $700 per mile. That In order to reproduce the said line it would be necessary to place tie plates thereon, the labor for which is estimated for the purpose of ascertaining the cost of reproduction, to cost the sum of $205. That it would be necessary in order to reproduce the said line in its present condition to construct 12 miles of barbed wire fence. That the crossings, cattle guards and signs along the line would cost, at present prices, to reproduce the same new, the sum of $431.24. That the interest of the Oregon Railroad & Navigation Company in the telegraph lines along the said line would cost to reproduce new the sum of $184.46. That the station buildings along the said line consist of a standard two-story station building at Wallula containing 8,861 square feet floor area, and for the purpose of ascertaining the cost of reproduc- tion the furniture and fixtures therein are estimated to cost the sum of $310. No. 3. That that portion of the main track and main line of the Oregon Railroad & Navigation Company extending from Wallula to Grange City, and being 65.9 miles in length, was constructed by the Snake River Valley Railroad Company about the year 1899, said Snake River Valley Railroad Company being a corporation organized and existing under and by virtue of the laws of the state of Oregon, having a capital stock of 10,000 shares of the par value of $100 per share, making a total capitalization of $1,000,000, of which $750,000 worth has been issued and is now owned by the Oregon Railroad & Navigation Company; that said Snake River Valley Railroad Com- pany was a subsidiary company of the Oregon Railroad & Navigation Company; that the Oregon Railroad & Navigation Company advanced from its treasury the funds necessary to construct the said line. Since the same was constructed said line has been operated by the Oregon Railroad