Subsidized Commuting

Only one U.S. railroad is state-owned: the 115-mile Rutland Railway, which Vermont bought last year to prevent it from dropping its passenger business. The chiefs of many other passenger lines have long called for federal or state aid, and lately they have gained support from more and more influential politicians.

Connecticut's Senator Abraham Ribicoff has proposed creation of a $100 million federal emergency fund to save the nation's failing commuter railroads, the weakest link in the U.S. chain of rails. To bolster the bankrupt New Haven line, whose trustees are seeking to cancel service covering all of its 26,000 commuters, Rhode Island's Senator Claiborne Pell wants to set up a four-state authority to provide subsidies. Last week New York's Senator Jacob Javits and Congressman Ogden Reid proposed that New York, Connecticut and the Federal Government share in underwriting the New Haven's commuter deficits. Two days later, in the most remarkable development of all, New York Governor Nelson Rockefeller proposed that his state government buy the nation's biggest commuter line: the Long Island Rail Road, upon which 175,000 commuters depend.

Rockefeller will ask the New York legislature to purchase the Long Island from the Pennsylvania Railroad--which is willing to negotiate a deal--and to set up an authority that would run the railroad and raise $200 million to modernize it. The Long Island operates under a special charter that since 1954 has excused it from both local taxes and interest payments on debt owed to the Pennsylvania (total savings: $80 million); even so, it lost $2,000,000 last year. In reluctantly concluding that the state should bail out the line, Rockefeller sided with most railroad presidents. Says the Pennsylvania's Stuart Saunders: "There is no way to make the commuter business profitable. It must be subsidized."

One railroad president conspicuously disagrees. Chicago & North Western Chief Ben Heineman last week announced that his commuter operation earned $706,000 in 1964. Heineman has achieved this unique success by raising fares, offering faster and more frequent service to attract riders during off-hours, and borrowing from Metropolitan Life to modernize the line. The North Western's $50 million fleet of air-conditioned, double-decker commuter trains carried 909,000 more passengers last year than in 1963, and Heineman is using newspaper and radio advertising to win even more.

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