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4 railways should not, in our judgment, be entered upon unless the evidence of competent operating experts fully justifies the conclusion that they will be self-supporting.

(2) Upon full consideration of the evidence, and the proper weight to be given to the witnesses, we are of opinion that the proposed electric railways would not be self-supporting.

(3) We are further of opinion that the construction of the proposed electric railways paralleling and competing as they would with the Canadian National Railway System, would be unwise and economically-unsound, and would strike a serious blow at the success of Government Ownership.

(4) We are further of opinion that until the Chippawa Power scheme, now estimated to cost $60,000,000 or upwards is completed, and has been in operation for sufficient length of time to be self-supporting, the Province would not be justified in endorsing for the construction of an electric railway system at an initial estimated cost of $45,000,000.

(5) We are further of opinion that the endorsement by the Province of bonds of the Hydro Electric Power Commission for systems of electric railways in various parts of the Province, at the instance of the municipalities concerned, is highly dangerous and may lead the Province into great financial difficulties. The endorsement for one locality would give rise to demands for the like accommodation for other localities, which it will be hard for any Government to refuse, and might result in the Province being drawn into serious financial liabilities, and we would therefore suggest that Government endorsement of such bonds should be discontinued. To the risk involved in accommodation endorsements, it is no answer to say that they are mere matters of form involving no real liability. Individual and corporate experience is to the contrary.

(6) Further, we are of opinion that the expenditure of $25,000,000 on improvement of public highways in the Province having been begun, it would be unwise to commence the construction of the electric railways in question until the effect in the! improvement of these highways has been ascertained, and the use of them by motor cars and motor trucks (whose competition with electric railways has been found so keen and difficult to meet elsewhere) made clearly apparent.

(7) We are further of opinion that the rapidly increasing debts and financial commitments of the Dominion, Province and Municipalities have aroused well-founded apprehension in the minds of thoughtful citizens, and are a cogent reason against the embarkation at this time in the construction of the contemplated electric railways.

THERE ARE, IN ADDITION, SOME GENERAL MATTERS which it may be well to refer to, and deal with, before coming to the main reasons of our report.

1. It is to be observed that we have, under consideration, 1. A plan or system of electric (or radial) railways, with original and supplemental estimates prepared by the Hydro Electric Power Commission of Ontario for the municipalities interested, and as to which we have already indicated our conclusions and findings,

2. A plan of Bion Arnold with substantial changes from the first, and estimates framed in connection therewith, as to which we intend our findings to equally apply.

3. It has been suggested that if either of or both these proposed schemes were found to be financially unfeasible, some different or modified scheme of construction in the territory might be deduced from the evidence. We shall make reference to this later, under the head of "Alternative Suggestions."

2. We had expected to complete our inquiry and make our report much earlier. We think it only fair to say that a considerable part of the delay, and much addition to the total expense, were occasioned by the course pursued by the Hydro Electric Power Commission of Ontario, and the Municipal Hydro Electric Railway Association, in connection with the investigation. We have prepared a statement setting forth in some detail the progress of the proceedings, by which we think this will be made apparent. (Appendix 2).

3. The Hydro Electric Power Commission of Ontario made a fundamental error when preparing the original estimates, and it was repeated when the supplementary estimates were prepared, in not seeking and securing the assistance of experienced operating men, at all events insofar as operating costs and possible revenues were concerned.