industrial railway and not as a common carrier. In 1907, while the cement plant at Crestmore was under construction, the cement company endeavored to induce the Southern Pacific Company to build a spur from Riverside to its plant. That company, however, was unwilling to build such a spur and, as adequate transportation facilities were essential to the successful operation of the cement plant, the railroad was built from Riverside to Crestmore by William G. Henshaw, who was largely interested in the cement company. Physical connection was made with the Southern Pacific Company and The Atchison, Topeka and Santa Fe Railway Company at Riverside, and with the San Pedro, Los Angeles and Salt Lake Railroad Company at Crestmore. This road is considered a steam railroad, although an electric passenger service is maintained over the entire line. An agreement, dated June 1, 1910, was entered into with the Pacific Electric Railway Company covering the operation of this company's electric cars over the road and the handling of all passenger traffic. The Cresent City Railway then connected with the Pacific Electric Railway Company in Riverside, and in 1910 constructed the distribution system from Market street junction in Riverside to Crestmore. The agreement expired June 1, 1911, but the operation continues as if it were still in effect. In 1911 the Cresent City Railway was extended to Bloomington, and the electric operation for passenger traffic was also extended. In 1913 the extension from Bloomington to Rialto was started, and at this time the Pacific Electric Railway Company maintains a through service between Riverside and Rialto. The railway commenced doing business as a common carrier on December 26, 1912; and the carrier's accounts, which previous to that time had been kept jointly with the accounts of the cement company, have been kept separate since that time. The operated mileage of the road is as follows: In addition to this mileage the carrier operates over certain interchange tracks, as follows: 1. The Atchison, Topeka and Santa Fe Railway Company interchange track in Riverside.... 0.50 miles 2. San Pedro, Los Angeles and Salt Lake Railroad Company interchange track in Crestmore.. 0.63 miles 3. Southern Pacific Company interchange track in Riverside... 0.40 miles Total 1.53 miles In the first of these interchange tracks this carrier owns a half interest. In the second it owns a third interest, and the last is owned entirely by the Southern Pacific Company. The Cresent City Railway is a standard gauge steam railway. equipped with trolley, supported on side poles with simple suspension, and carrying 600 volts for the operation of the electric passenger cars. The line commences in Riverside, runs northerly for about a mile through that city, continues northerly, crossing the Santa Ana River on a long wooden trestle with embankment approaches, runs thence still northerly, along comparatively level ground, to Bloomington, passing the Riverside-Portland Cement Company's plant about 3.4 miles from the initial point in Riverside, and crosses the RiversideSan Bernardino county line about 3.8 miles from the same point. From Bloomington the line runs in a northeasterly direction to Rialto, crossing the main line track of The Atchison, Topeka and Santa Fe Railway Company immediately south of that town. The carrier operates over the larger portion of the line on its own right of way, which consists of a strip of land varying from 10 feet to 100 feet and averaging 50 feet in width, with no extra areas for station grounds or terminal yards except a number of lots located at Bloomington and used partly for station grounds and partly occupied by an orange grove. The carrier owns two franchises and two easements from the city of Riverside and one franchise from the county of San Bernardino. These stipulate that the carrier shall allow certain clearances for streets, construct and maintain certain irrigation channels in Riverside city park, and maintain one overhead crossing. Between Bloomington and Rialto the county gave the railway a franchise on the condition that the latter regrade and oil forty feet of the county road. There is nothing unusual about the location and construction of this railway. The grading is very light, except across the bottom of the Santa Ana River, where the work is all embankment, averaging ap proximately 12 feet in height. The road is built with a 14-foot roadbed, and where the higher embankments occur the fill is made wider. The maximum curvature on the road is 12 degrees, and the maximum grade, 2 per cent. The weight of the main line rail is 60 and 65 pounds per yard in Riverside County and 60 and 56 pounds per yard in San Bernardino County. The carrier owns its steam equipment for the handling of freight exclusively. The passenger service is performed by the Pacific Electric Railway Company under contract. 2. Stocks and Bonds. This railway is owned solely by William G. Henshaw, is not an incorporated company, and has no stocks or bonds issued or outstanding. 3. Revenues and Expenses. The Cresent City Railway has been in operation only since December 26, 1912, and traffic and revenue statistics are therefore available for only one entire fiscal year. The total revenue originates from freight and switching operations. The passenger traffic is handled. under a written agreement, dated June 1, 1910, between the Cresent City Railway and the Pacific Electric Railway Company, by which the latter company has the sole right to operate electric passenger cars on the main line of the Cresent City Railway between Market street junction in Riverside and Bloomington. This right was extended to Rialto when the line was opened for traffic to that point on March 25, 1914. In consideration of the above right the Pacific Electrie Railway Company pays monthly to the Cresent City Railway one third of the gross passenger receipts of the Riverside-BloomingtonRialto line, less one third of the monthly wages of trainmen and one third of the cost of electric energy used. The written arrangement referred to expired on June 1, 1911, since which time the Pacific Electric Railway Company has been permitted to operate its cars on the same basis and as if the arrangement were still in effect. Under this agreement the income accruing during the last fiscal year to the Cresent City Railway is shown in the carrier's last annual report as “joint facility rent income," and amounts to $5,745.32. The principal operating revenue and expense figures for the fiscal year ending June 30, 1914, follow: Average number of tons of freight per loaded car mile.. 33.26 184.79 10.77 5.56 5.21 9.33 The principal commodities in the freight traffic movement were these: Cement, it will be noted, is by far the most important commodity. constituting more than 55 per cent of the total tonnage hauled. The general balance sheet of June 30, 1914, shows this carrier in a very healthy financial condition, with a credit to the profit and loss account of $84,572.70, as a result of only eighteen months of operation. It would appear, from the traffic figures given that the Cresent City Railway is efficiently conducting a very profitable business. 4. Original Cost. Although this road is of comparatively recent construction, its entire original cost, in accordance with the definition given heretofore. can not be ascertained. This is because there was no distinction between expenditures for the railway and the Riverside-Portland Cement Company during the early period of construction of these plants. the funds for both enterprises coming from the same source. After a portion of the road had been placed in operation, this unsatisfactory method of accounting was changed, and the books of the railway since then have been kept according to the Interstate Commerce Commission's and this Commission's accounting classification. In its annual report to the Commission this carrier shows under the entry "Investment in road and equipment as of June 30, 1914." the following items: Value on December 26, 1912, based on appraised value June 30, 1913: The average figure per mile of road, on the basis of 9.78 miles main line and on the basis of the net total of $488,624.85, is, therefore, $49,961.64. It is to be noted that this carrier bases the book investment value of the property on an appraisal. While it is true that the original cost, as defined, can not be had, the engineering department has, however, been able to obtain much valuable original cost data, of which use has been made in the valuation undertaken by the Commission. 5. Reproduction Cost. The carrier in its appraisal states that the value of its property as of June 30, 1913, was $446,273.81 (see Exhibit "A"). Its statement of expenditures for road and equipment, additions and betterments, and materials and supplies, for the period from July 1, 1913, to January 1, 1914, totals $102,117.65, and is made up of the following items: |