Octobel- ig, 19IO.





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PresHent, CLINTON W. SWEET                     Treasurer, P. W. DODGB

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"Entered at the Post Office at New York„ N.  T.. oa srcon<!-cla.'<s matter."
Copyrighted.  1010,  by The   Record  fi.  Guide   Co.





Vol. LXXXVl.





OCTOBER 2D, 1910.





No. 222-1





THE great number of bids received by the Public Service
Commission for the constructioil of the Broadway-Lex¬
ington avenue route are now being tabulated, and next week
will probably tell whether there is to be an increase in rapid
transit facilities. If the Tri-borough route is to be built, it
must be paid for by the issue of municipal securities, and the
issue of municipal securities for this purpose is attended by
many doubtful considerations. In the first place, the city
has only some $60,000,000 which it can spend upon subways
—which means that the new subway would have to be con¬
structed slowly section by section. The Manhattan line
would be built first, and as soon as its profitable operation
was demonstrated, the money could be used over again for
the construction of the Brooklyn and Bronx lines. Such a
method would doubtless be entirely feasible, but it would
mean that Brooklyn and the Bronx would have to wait at
least six or seven years for additional rapid transit. In
the meantime all other subway construction dependent upon
the use of municipal credit woqld probably have to be sus¬
pended. Everything else would have to be sacrificed for a
period of many years to the construction of a subway which
for four miles of its route merely duplicates existing facili¬
ties, and leaves an important and growing part of Man¬
hattan wholly unprovided with rapid transit. Such con¬
siderations should make the Board of Estimate very cau¬
tious about committing the city to this expenditure. In
the opinion of the Record and Guide the policy which it
should pursue is fairly obvious. If the Public Service Com¬
mission can obtain a tenant for the Broad way-Lexington
avenue route of unimpeachable responsibility, such as the
New Haven Railroad Company, who will agree to pay an
adequate rental, there is nothing to do but to go ahead and
use the municipal credit for the purpose. The Public Ser¬
vice Commission has placed before the city an alternative,
either end of which has grave disadvantages; but the worse
alternative of the two is an indefinite postponement of sub¬
way construction. Better a costly and retarded subway
than no subway at all—provided the city is guaranteed
against loss as a consequence of its investment. But if no
thoroughly responsible tenant can be secured in advance, it
would be madness to proceed with the construction of the
Tri-borough route. The city cannot afford the risk of
operating such an expensive system at a loss. The Broad¬
way-Lexington avenue route will have to carry a construction
charge somewhere between three and four times as large
as that carried by the existing subway; and if no private
company can see any profit in its operation, it is a fair infer¬
ence that the city would be even worse offi. In that event
the only alternative would be to pursue the course advocated
so ably by Mr. Frank J. Sprague—the course, that is, of
making terms with the Interborough Company, if possible.
In case it is impossible to make terms with the Interborough
Company, a cheaper independent subway route should be laid
out, which could eventually be combined with the existing
subway.





THE tentative Budget for the coming year emphasizes the
importance of not increasing the city debt for any
expensive and unremunerative purpose. The expenditures
for the coming year will be some $8,000,000 more than they
have been during the past year; and of this $8,000,000, about
one-half is caused by the debt service. The other half of
the increase results from the necessity of making good defi¬
ciencies in taxation.      Thus the whole increase results from





the creation of past obligations of one kind or another; and it
is evident that taxation will continue to increase until some
means are found of keeping down expenditures under this
head. The situation is getting desperate, and requires dras¬
tic remi3dies. There can be no doubt that the present
financial administration of the city bag done its best to
reduce expenditures and to run the city economically. Yet
in spite of its best efforts, and in spite of all the much
advertised reforms in Budget-making, the taxpayers of New
York are confronted by another increase in the tax rate—
an increase which will be at least as large as that which
was written on the tax bills for the current fiscal year. The
existing tax-rate, when applied to any probable increase in
the asse'ssed valuation, 5vill not bring in more than about
$5,000,000 of additional revenue. Most of tbe residue will
have to be furnished by the taxpayers. The economies iu
departmental appropriations just about balanced the in¬
creases. The outlook for checking in any effectual way the
constant increase in taxation is very discouraging, because
the necessary increase in expenditure, from the various
sources of municipal indebtedness will continue. Property-
owners must remember that these successive increases in
the tax-rate mean a necessary deduction in the capital value
of their real estate, aad this deduction of capital value falls
upon all classes of real estate. It falls, that is, not only on
property which is increasing in value, but upon property
which is stationary in value. It is evident that the fiscal
system of New York City must be radically reorganized; and
to that end a commission should be authorized by the next
Legislature, whose duty it would be to make a careful cal¬
culation of the city's resources, its probable future financial
needs, and the best way of meeting and distributing them.
After all the agitation of the past few years, the city is still
stumbling along in the dark, incapable either of preventing
further progress down hili and utterly lacking in any general
or clear understanding of its situation.





THE contrast between the financial situation of New York
and that of Paris is extraordinary. New York is increas¬
ing in population over five times as fast.as Paris, and its
increase in wealth is proportionally still greater. Yet New
York, with all the vast resources in the way of income cre¬
ated by such an increase in population, is straifling its debt-
creating powers to the uttermost. It is incapable finan¬
cially of undertaking any of those street widening and ex¬
tensions which are necessitated by the increasing traffic,
because it cannot afford to increase by the required amount
its unremunerative debt. Paris, on the other hand, has
just begun a series of public improvements which will even¬
tually call for the expenditure of $170,000,000. Practically
the whole of this sum will be spent upon projects which
will not return to the city a penny of direct income. About
half it will be invested in parks, school houses, improved
sanitary measures, and the like. The other half will be
used to complete the vast system of street improvements
which was initiated over fifty years ago, under the Second
Empire. Over $40,000,000 of the total has already been
raised, and work is to be commenced immediately—the net
result of which will be to confirm the prestige of Paris as
the most beautiful and convenient of modern European cit¬
ies. While this is taking place in Paris, New York cannot
afford to buy land for a new court house, but must further
diminish the area of the City Hail Park in order to obtain
the needed site. If a large part of the municipal income
of New York were raised as it is in Paris by a habitation
tax, the local public would take more interest than it doea
at present in questions of municipal finance and economy.





HOTEL building is always a popular form of building
improvement because a successful hotel is one of the
most profitable uses to which city real estate can be put. But
it is almost as precarious as it is profitable. In a modern Am¬
erican city with the rapid shifting of population and with the
equally rapid changes in the standards of architectural and
decorative taste, the life of a hotel is usually short—-com¬
pared to the amount of capital required for its construction.
Of late years one hotel after another whose construction ante¬
dated that of the "Waldorf-Astoria has either been torn down
or has been operated at a loss aud will soon be torn down.
' In the region of Madison Square the old Brunswick and the
Fifth Avenue have already been thrown into the scrap-
heap. The Albemarle was closed for a long time, and can¬
not bn a very profitable enterprise, and now the Hoffmau
House, which twenty years ago shared the honors of Madison
Square with the Fifth Avenue Hotel, has gone into the hands