nnua epoftmiddot 10

Panoramic view of the east apshyproach to the Milwaukee Roads new freight car repair facility in the Bensenville III yards showshying the shop building service tracks and counterweight towers

Closeup of one of the inbound car pullers which by means of a cable draws freight cars into the encloseq repair area

Inside view of the shop buildshying Clear plastic panels in the roof and walls of the building admit maximum natural light infra-red ray heaters above the work areas provide comfort in winter weather

Ii

Outbound facilities west of the shop include the components of the small car pu Ilers At rig ht is the modern office and welfare building

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY General Offices-516 W Jackson Boulevard Chicago 6 Illinois

Terms Expiring 1961 1962 1963

E AINSWORTH EYRE ARTHUR S BOWES JOHN D ALLEN ] PATRICK LANNAN JEROME C EpPLER JAMES M BARKER JAMES D NORRIS JOHN B GALLAGHER LEO T CROWLEY WILLIAM 1 OBRIEN JOSHUA GREEN WALTER] CUMMINGS PHILIP W PILLSBURY ARNOLD B KELLER WILLIAM] FROELICH FRANKLIN B SCHMICK WALTER T MAHONEY WILLIAM] QUINN JOHN P WAGNER LOUIS QUARLES ARTHUR M WIRTZ

WILLIAM] SINEK

] PATRICK LANNAN Chairman JOHN D ALLEN WILLIAM] FROELICH WILLIAM] QUINN LEO T CROWLEY JOHN B GALLAGHER WILLIAM] SINEK WALTER] CUMMINGS ARTHUR M WIRTZ

WALTER] CUMMINGS Chairman JOHN D ALLEN JEROME C EpPLER ] PATRICK LANNAN JAMES M BARKER WILLIAM] FROELICH LOUIS QUARLES LEO T CROWLEY JOHN B GALLAGHER JOHN P WAGNER

ARNOLD B KELLER ARTHUR M WIRTZAlternate Members

1 T CROWLEY Chairman of the Board CHICAGO W] QUINN President CHICAGO W W KREMER Vice President-Traffic CHICAGO E R ECKERSALL Vice President and General Counsel CHICAGO F G MCGINN P H DRAVER

Vice President-Operation Vice President-Industrial Development

CHICAGO CHICAGO

R S STEPHENSON Vice President-Finance and Accounting CHICAGO 1 H DUGAN Vice President and Western Counsel SEATTLE E O SCHIEWE General Solicitor CHICAGO R F KRATOCHWILL J] ROCHE C T LANNON

Comptroller Secretary Treasurer

CHICAGO CHICAGO CHICAGO

The Chase Manhattan Bank New York 15 NY The First National City Bank of New York Room 732 Union Station Chicago 6 Ill New York 15 NY

Continental Illinois National Bank and Trust Company of Chicago Chicago 90 Ill

May 9 1961 Chicago Illinois

This Annual Report is not and must not be considered as proxy soliciting material or as a report or document filed pursuant to the Securities Exchange Act or any rule or regulation thereunder

1960 1959

Operating revenues $230362902 Operating expenses 187929803 Taxes Federal State and Local 20137000 Net railway operating income 9654308 Other income-Net 3588037 Income available for fixed charges 13242345 Fixed charges 5677502 Contingent charges 6241780

$242041825 198851581 19415000 13651274 4047361

17698635 5471962 6351497

Net income Net income per share-Series A Preferred

-Common Times fixed charges earned

$

1323063 255

o 233

$ 5875176 1133

155 323

Dividends paid Series A Preferred-$500 per share Common-$150 per share

Total dividends paid Number of stockholders as December 31

Series A Preferred Common

Out of earnings of the prior year

$

2593260 3184872 5778132

5015 10649

$ 2593260 3184871 5778131

5089 9902

Gross capital expenditures For road property improvements For equipment

Total

$

6123291 13966899 20090190

$ 5940814 21733124 27673938

Traffic statistics Net ton-miles of revenue freight (thousands) 13605766 Freight revenue $189560907 Passengers carried one mile 627831562 Passenger revenue $ 15174969

14123258 $201536333 648200824

$ 15282171

Total amount of payroll $121135807 Average number of employees 20229

$128399667 22243

Gross ton miles per train-hour Gross tons per train Net ton-miles per train-hour Net tons per train

(Indices of freight-train performance)

66674 3305

29255 1450

64565 3228

28570 1428

2

-

shy -I -~tmiddot - I ~i ~ I III t I I II 111 11 I I I

-shy

In the face of a general recession which sharply reduced railroad revenues in 1960 the Milwaukee Road successfully effected a balshyanced reduction in expenses and built securely on a strong foundation for the future Improveshyments were introduced to provide the public with the best in service and the property was maintained in condition to take full advantage of the business upturn anticipated for 1961

The general reduction in railroad carloadings as business slowed intensified the problem of underutilization of plant and equipment

The actual extent of the decline in earnings and revenues came as a disappointment The reduction in earnings was due entirely to lower revenues which amounted to $230362902 compared with $242041825 in 1959 a reducshytion of $11678923 Through rigid economies operating expenses were likewise reduced by $10921778 from the 1959 level It was not possible however to completely offset the efshyfect of the decline in revenues with the result that net income in 1960 amounted to $1323063 compared with $5875176 in 1959

On February 23 1961 the Board of Direcshyrors declared a dividend out of the 1960 earnshyings or out of the accumulated earned surplus of the Corporation for prior calendar years of $500 per share on the Series A preferred stock payable in four installments of $125 per share each on March 30 June 29 September 28 and November 30 in 1961 to holders of record at the close of business March 10 June 9 Sepshytember 8 and November 10 1961 respectively

Declaration of a dividend on the Common Stock has been deferred until a better appraisal can be made of future business conditions both generally and in the railroad industry

The outlook for 1961 is more favorable There is already indication that housing starts will be up to some extent and we can reasonshyably expect some improvement in the moveshyments of lumber and other forest products In this freight category which is of major imshyportance to the Milwaukee Road our 1960 revenues were down 162 from 1959

3

Other unfavorable factors in 1960 were the slump in the iron and steel industry resulting in decreased revenues from the smaller traffic in many manufactured products and the disshyappointing showing of the grain movement The latter situation developed despite a good grain crop in Milwaukee Road territory beshycause of a decline in government grain releases particularly in the last months of the year

Improvement in any of these three major freight categories could result in a welcome upturn in 1961 A very substantial volume of small grains and corn remains in farm and country elevator storage on the Milwaukee Road for eventual movement to market The Milwaukee Road is in a strong position to take advantage of the better business conditions now generally predicted for the months ahead The improvement program of the last several years has modernized plant and equipment We have the tools to render improved service to shippers and to meet competition

Another noteworthy feature has been the aggressiveness of the campaign to develop new freight traffic and win back business from comshypeting forms of transport Many of these acshytivities should make themselves felt in still greater measure during 1961

For example the Milwaukee Road has moved ahead in providing rail-truck delivery by a single carrier to remote heavy construction sites such as power and irrigation dams and other government projects We are actively seekshying business of this kind and it should add appreciably to revenues in the next year or two

Transport of automobiles is another example of Milwaukee leadership in winning traffic to the rails As a consequence revenues from auto shipments were up $2760468 in 1960 These and other developments of the year illustrate the alertness with which new facilities equipshyment and services are being employed to build business This creative approach to railroading will be decisive as the economy turns up again to insure that the Milwaukee Road takes full advantage of new opportunities

Joint merger studies with the Rock Island Lines begun in 1959 were continued and inshytensmed in 1960 Toward the end of the year however it became evident that effecting a merger of the two systems would be a timeshyconsuming project in the face of the unforeseen obstacles that had been encountered

Since then merger discussions have been initiated between the managements of the Milshywaukee Road and the Chicago and North Westshyern Railway As of the date of this report the roads have not yet reached an agreement

Railroads continue to form the backbone of the common carrier system Their ability to move large tonnages of raw materials and manshyufactured goods at low cost on equal terms to all shippers is a necessity if we are to keep this continent one great mass market

In light of these facts there is urgent need

to review public transportation policy We must face the reality that no form of transport today has anything like a monopoly and regulations based on conditions of half a century ago are dangerously out of date Instead of artificial restrictions transportation companies should be given every encouragement to use the most modern devices and equipment for moving goods and people by whatever combination of methods is efficient

Nothing could be more important to the future of the Milwaukee Road or any other common carrier than a basic understanding by shippers and the public of the urgency of these problems It is time to clear away the misconshyceptions and outmoded regulations that bar the way to progress so that we may enter upon a new era of transportation efficiency and profitshyability

Chairman of the Board

By order of the Board of Directors March 16 1961

4

The Milwaukee Road is the railroad of the Creative Crews The sum total of the efforts of these crews-out on the line in the shops and in the offices-is a smooth working closely knit effishycient transportation unit

The services and operation of Carscope established late in 1959 were expanded substantially during 1960 The original function was centered on the tracing of the movement of all carloads over the system to provide up-to-the-minute information on the location and movement of all carload freight for shippers and receivers anyshywhere in the United States Since the center started operations other uses of the data provided have been developed through additional sorting and assembly of punched card data

The program of conversion to an electronic data processing system moved ahead in 1960 toward an operational goal in the second half of 1961 Major accounting processes are being redesigned to integrate related functions simplify procedures speed the flow of data and in general achieve maximum benefit from central processing on new electronic equipment Testing of programming for the IBM 7070 computer was started late in the year

The last of nine regional data offices was recently established completing a program started in mid-1960 to provide a means of moving basic information more rapidly from dispersed source points to the central computer Each office will gather freight revenue payroll and material data in its area and transmit over telephone lines to Chicago In addition freight billing and collection operations are being transferred to the regional offices from the hundreds of local agencies with attendant advantages from concentration and specialization of functions

The computer center at Chicago will also use freight movement information fed in hourly by teletype from 36 key yard offices equipped with punched-card and transmission equipment In addition to accounting outputs and control statistics the computer will develop from such input all reports needed by Carscope as well as reports designed to aid in the distribution of empty freight cars

New types of sales kits unique in the railroad industry provide traffic solicitors with visual aids in the form of pictures maps diagrams and colored leaflets graphishycally presenting the services of the railroad

New traffic department offices opened in 1960 were sales and service units estabshylished in Birmingham Ala and Memphis Tenn

5

Trailer-on-flat car services to shippers were broadened substantially in 1960 by the use of Flexi-Van conventional piggybacking and containerization The Flexi-Van fleet has been expanded four times since the inception of that service a little over two years ago In order to widen its piggyback service the railroad joined in 1960 the national equipment pools of Trailer Train Company and North American Car Corporashytion which provide flat cars for piggyback movements

The transcontinental piggybacking of automobiles which the railroad started early in 1960 expanded greatly during the course of the year

Deliveries of new Flexi-Van equipment to the Milwaukee Road and its subsidiary - The Milwaukee Motor Transportation Company-were substantial during 1960 Early in the year the railroad added 25 new Flexi-Van 85-foot flat cars and the Milwaushykee Motor added 75 new vans and 60 new bogies (wheel assemblies) The 85-foot flat cars were the first Flexi-Van cars of that length to be put into service in the industry

In mid-year Milwaukee Motor received delivery of 25 new mechanically refrigershyated Flexi-Van units equipped with dual temperature controls so they also can be heated for wintertime shipping of perishable commodities In addition 12 Milwaukee Motor insulated vans that already were in FIexi-Van service were converted into refrigshyerated trailers with the addition of mechanical refrigeration units

The deliveries of Flexi-Van units brought the Flexi-Van fleet to a total of 64 special flat cars and Milwaukee Motors fleet to a total of 221 vans and 142 bogies

Additions were made to the fleet of conventional piggybacking cars in 1960 by the conversion in the Milwaukee shops of a total of 121 flat cars to that type of operation Important in the speeding of transcontinental piggybacking of new automobiles by the Milwaukee from Chicago to the Pacific northwest was the lowering of the track through the eighty-five year old tunnel at Tunnel City Wis by 26 inches providing clearance for the automobile shipments

The larger clearance created by the project permitted the railroad to step up its schedules for the auto piggybacking and for other high dimension loads on the Chicago-Milwaukee-Twin Cities route The project which was completed in record time involved the re-Iaying of 3200 feet of track

In 1960 a coordinated rail-truck operation was developed in Washington The operation involves the transporting of bulk cement and of steel special equipment and machinery

This service is provided by a subsidiary-The Milwaukee Motor Transportation Company-which uses tractors and semi-trailers for the major part of the hauling Cranes transfer heavy equipment from rail cars to the motor carrier units

During 1960 Milwaukee Motor hauled a substantial number of carloads of cement steel special equipment and machinery from railheads to construction sites

This is an excellent example of how a railroad has tailored its services to meet the needs of shippers and consignees and retain business that otherwise would have been diverted to competitors In this instance the Milwaukee provides the link between the railhead and off-track construction sites thus handling the entire movement to the satisfaction of the contractors involved The efficiency of the operation is enhanced for the contractor because he has to do business with only one carrier

6

_ ~ I I

II I

A one million dollar spot system facility for repairing freight cars was placed in operation at the Bensenville Ill yards early in November Its completion marked another advance in the adoption of ultramodern techniques for speeding freight moveshyments for shippers and at lower cost to the railroad

The facility is one of the largest of its type in the country and the first to be inshystalled on a railroad serving the Northwest region The so-called one-spot repair system new in concept and practice is based on the principle of moving cars to men and material rather than men taking material to cars

The system is a compact layout featuring a 120 by 120 foot shop building with four servicing tracks Each of the tracks is equipped with two electric power winches that pull the cars to and from the shop building by means of between-the-rail cables attached to axle engaging devices known as rabbits The operation is controlled from a push button panel located at trackside in the building

Tools parts and equipment are assembled in one sheltered location to which cars are brought in a continuous flow All repairs are performed in the building with work going forward on the cars one at a time on the individual tracks The facility can be operated in all kinds of weather 24 hours a day

In 1960 the Milwaukee purchased new freight cars to meet the growing demand for longer and larger capacity rolling stock at a total cost of $9994400 A total of 775 new cars of various types was added to the fleet including 500 new wide door box cars 100 new covered hopper cars 100 general purpose flatcars of 60 foot length 50 damage free freight cars and 25 gondola cars

The 500 new box cars featuring doors which can be opened to a width of 15 feet 2 inches brought the Milwaukees total ownership of this highly versatile type to 1500

All the new freight cars purchased in 1960 had a capacity of 70 tons each and were equipped with roller bearings

An upgrading program carried out in Milwaukee included the rebuilding of 50-ton refrigerator cars 70-ton mill type gondola cars and 70-ton hopper type cars along with various other types of changes and additions to provide a wider and better service to shippers The major project in the Tacoma shops was the upgrading and repair of double door cars of 40 and 50 foot lengths

Delivery will start this spring on 40 new double-deck passenger cars ordered for suburban service from The Budd Company Philadelphia Pa at a cost of approxishymately six million dollars

The order for the new cars placed shortly after the approval of a fare increase last spring by the Illinois Commerce Commission was the first big step in the commuter service modernization program which looks toward the eventual replacement as earnshyings permit of all the present suburban cars with new double deck coaches

7

~- I II I j I III 1II~JII I ~ ~ I III~ I II I1III

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

Panoramic view of the east apshyproach to the Milwaukee Roads new freight car repair facility in the Bensenville III yards showshying the shop building service tracks and counterweight towers

Closeup of one of the inbound car pullers which by means of a cable draws freight cars into the encloseq repair area

Inside view of the shop buildshying Clear plastic panels in the roof and walls of the building admit maximum natural light infra-red ray heaters above the work areas provide comfort in winter weather

Ii

Outbound facilities west of the shop include the components of the small car pu Ilers At rig ht is the modern office and welfare building

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY General Offices-516 W Jackson Boulevard Chicago 6 Illinois

Terms Expiring 1961 1962 1963

E AINSWORTH EYRE ARTHUR S BOWES JOHN D ALLEN ] PATRICK LANNAN JEROME C EpPLER JAMES M BARKER JAMES D NORRIS JOHN B GALLAGHER LEO T CROWLEY WILLIAM 1 OBRIEN JOSHUA GREEN WALTER] CUMMINGS PHILIP W PILLSBURY ARNOLD B KELLER WILLIAM] FROELICH FRANKLIN B SCHMICK WALTER T MAHONEY WILLIAM] QUINN JOHN P WAGNER LOUIS QUARLES ARTHUR M WIRTZ

WILLIAM] SINEK

] PATRICK LANNAN Chairman JOHN D ALLEN WILLIAM] FROELICH WILLIAM] QUINN LEO T CROWLEY JOHN B GALLAGHER WILLIAM] SINEK WALTER] CUMMINGS ARTHUR M WIRTZ

WALTER] CUMMINGS Chairman JOHN D ALLEN JEROME C EpPLER ] PATRICK LANNAN JAMES M BARKER WILLIAM] FROELICH LOUIS QUARLES LEO T CROWLEY JOHN B GALLAGHER JOHN P WAGNER

ARNOLD B KELLER ARTHUR M WIRTZAlternate Members

1 T CROWLEY Chairman of the Board CHICAGO W] QUINN President CHICAGO W W KREMER Vice President-Traffic CHICAGO E R ECKERSALL Vice President and General Counsel CHICAGO F G MCGINN P H DRAVER

Vice President-Operation Vice President-Industrial Development

CHICAGO CHICAGO

R S STEPHENSON Vice President-Finance and Accounting CHICAGO 1 H DUGAN Vice President and Western Counsel SEATTLE E O SCHIEWE General Solicitor CHICAGO R F KRATOCHWILL J] ROCHE C T LANNON

Comptroller Secretary Treasurer

CHICAGO CHICAGO CHICAGO

The Chase Manhattan Bank New York 15 NY The First National City Bank of New York Room 732 Union Station Chicago 6 Ill New York 15 NY

Continental Illinois National Bank and Trust Company of Chicago Chicago 90 Ill

May 9 1961 Chicago Illinois

This Annual Report is not and must not be considered as proxy soliciting material or as a report or document filed pursuant to the Securities Exchange Act or any rule or regulation thereunder

1960 1959

Operating revenues $230362902 Operating expenses 187929803 Taxes Federal State and Local 20137000 Net railway operating income 9654308 Other income-Net 3588037 Income available for fixed charges 13242345 Fixed charges 5677502 Contingent charges 6241780

$242041825 198851581 19415000 13651274 4047361

17698635 5471962 6351497

Net income Net income per share-Series A Preferred

-Common Times fixed charges earned

$

1323063 255

o 233

$ 5875176 1133

155 323

Dividends paid Series A Preferred-$500 per share Common-$150 per share

Total dividends paid Number of stockholders as December 31

Series A Preferred Common

Out of earnings of the prior year

$

2593260 3184872 5778132

5015 10649

$ 2593260 3184871 5778131

5089 9902

Gross capital expenditures For road property improvements For equipment

Total

$

6123291 13966899 20090190

$ 5940814 21733124 27673938

Traffic statistics Net ton-miles of revenue freight (thousands) 13605766 Freight revenue $189560907 Passengers carried one mile 627831562 Passenger revenue $ 15174969

14123258 $201536333 648200824

$ 15282171

Total amount of payroll $121135807 Average number of employees 20229

$128399667 22243

Gross ton miles per train-hour Gross tons per train Net ton-miles per train-hour Net tons per train

(Indices of freight-train performance)

66674 3305

29255 1450

64565 3228

28570 1428

2

-

shy -I -~tmiddot - I ~i ~ I III t I I II 111 11 I I I

-shy

In the face of a general recession which sharply reduced railroad revenues in 1960 the Milwaukee Road successfully effected a balshyanced reduction in expenses and built securely on a strong foundation for the future Improveshyments were introduced to provide the public with the best in service and the property was maintained in condition to take full advantage of the business upturn anticipated for 1961

The general reduction in railroad carloadings as business slowed intensified the problem of underutilization of plant and equipment

The actual extent of the decline in earnings and revenues came as a disappointment The reduction in earnings was due entirely to lower revenues which amounted to $230362902 compared with $242041825 in 1959 a reducshytion of $11678923 Through rigid economies operating expenses were likewise reduced by $10921778 from the 1959 level It was not possible however to completely offset the efshyfect of the decline in revenues with the result that net income in 1960 amounted to $1323063 compared with $5875176 in 1959

On February 23 1961 the Board of Direcshyrors declared a dividend out of the 1960 earnshyings or out of the accumulated earned surplus of the Corporation for prior calendar years of $500 per share on the Series A preferred stock payable in four installments of $125 per share each on March 30 June 29 September 28 and November 30 in 1961 to holders of record at the close of business March 10 June 9 Sepshytember 8 and November 10 1961 respectively

Declaration of a dividend on the Common Stock has been deferred until a better appraisal can be made of future business conditions both generally and in the railroad industry

The outlook for 1961 is more favorable There is already indication that housing starts will be up to some extent and we can reasonshyably expect some improvement in the moveshyments of lumber and other forest products In this freight category which is of major imshyportance to the Milwaukee Road our 1960 revenues were down 162 from 1959

3

Other unfavorable factors in 1960 were the slump in the iron and steel industry resulting in decreased revenues from the smaller traffic in many manufactured products and the disshyappointing showing of the grain movement The latter situation developed despite a good grain crop in Milwaukee Road territory beshycause of a decline in government grain releases particularly in the last months of the year

Improvement in any of these three major freight categories could result in a welcome upturn in 1961 A very substantial volume of small grains and corn remains in farm and country elevator storage on the Milwaukee Road for eventual movement to market The Milwaukee Road is in a strong position to take advantage of the better business conditions now generally predicted for the months ahead The improvement program of the last several years has modernized plant and equipment We have the tools to render improved service to shippers and to meet competition

Another noteworthy feature has been the aggressiveness of the campaign to develop new freight traffic and win back business from comshypeting forms of transport Many of these acshytivities should make themselves felt in still greater measure during 1961

For example the Milwaukee Road has moved ahead in providing rail-truck delivery by a single carrier to remote heavy construction sites such as power and irrigation dams and other government projects We are actively seekshying business of this kind and it should add appreciably to revenues in the next year or two

Transport of automobiles is another example of Milwaukee leadership in winning traffic to the rails As a consequence revenues from auto shipments were up $2760468 in 1960 These and other developments of the year illustrate the alertness with which new facilities equipshyment and services are being employed to build business This creative approach to railroading will be decisive as the economy turns up again to insure that the Milwaukee Road takes full advantage of new opportunities

Joint merger studies with the Rock Island Lines begun in 1959 were continued and inshytensmed in 1960 Toward the end of the year however it became evident that effecting a merger of the two systems would be a timeshyconsuming project in the face of the unforeseen obstacles that had been encountered

Since then merger discussions have been initiated between the managements of the Milshywaukee Road and the Chicago and North Westshyern Railway As of the date of this report the roads have not yet reached an agreement

Railroads continue to form the backbone of the common carrier system Their ability to move large tonnages of raw materials and manshyufactured goods at low cost on equal terms to all shippers is a necessity if we are to keep this continent one great mass market

In light of these facts there is urgent need

to review public transportation policy We must face the reality that no form of transport today has anything like a monopoly and regulations based on conditions of half a century ago are dangerously out of date Instead of artificial restrictions transportation companies should be given every encouragement to use the most modern devices and equipment for moving goods and people by whatever combination of methods is efficient

Nothing could be more important to the future of the Milwaukee Road or any other common carrier than a basic understanding by shippers and the public of the urgency of these problems It is time to clear away the misconshyceptions and outmoded regulations that bar the way to progress so that we may enter upon a new era of transportation efficiency and profitshyability

Chairman of the Board

By order of the Board of Directors March 16 1961

4

The Milwaukee Road is the railroad of the Creative Crews The sum total of the efforts of these crews-out on the line in the shops and in the offices-is a smooth working closely knit effishycient transportation unit

The services and operation of Carscope established late in 1959 were expanded substantially during 1960 The original function was centered on the tracing of the movement of all carloads over the system to provide up-to-the-minute information on the location and movement of all carload freight for shippers and receivers anyshywhere in the United States Since the center started operations other uses of the data provided have been developed through additional sorting and assembly of punched card data

The program of conversion to an electronic data processing system moved ahead in 1960 toward an operational goal in the second half of 1961 Major accounting processes are being redesigned to integrate related functions simplify procedures speed the flow of data and in general achieve maximum benefit from central processing on new electronic equipment Testing of programming for the IBM 7070 computer was started late in the year

The last of nine regional data offices was recently established completing a program started in mid-1960 to provide a means of moving basic information more rapidly from dispersed source points to the central computer Each office will gather freight revenue payroll and material data in its area and transmit over telephone lines to Chicago In addition freight billing and collection operations are being transferred to the regional offices from the hundreds of local agencies with attendant advantages from concentration and specialization of functions

The computer center at Chicago will also use freight movement information fed in hourly by teletype from 36 key yard offices equipped with punched-card and transmission equipment In addition to accounting outputs and control statistics the computer will develop from such input all reports needed by Carscope as well as reports designed to aid in the distribution of empty freight cars

New types of sales kits unique in the railroad industry provide traffic solicitors with visual aids in the form of pictures maps diagrams and colored leaflets graphishycally presenting the services of the railroad

New traffic department offices opened in 1960 were sales and service units estabshylished in Birmingham Ala and Memphis Tenn

5

Trailer-on-flat car services to shippers were broadened substantially in 1960 by the use of Flexi-Van conventional piggybacking and containerization The Flexi-Van fleet has been expanded four times since the inception of that service a little over two years ago In order to widen its piggyback service the railroad joined in 1960 the national equipment pools of Trailer Train Company and North American Car Corporashytion which provide flat cars for piggyback movements

The transcontinental piggybacking of automobiles which the railroad started early in 1960 expanded greatly during the course of the year

Deliveries of new Flexi-Van equipment to the Milwaukee Road and its subsidiary - The Milwaukee Motor Transportation Company-were substantial during 1960 Early in the year the railroad added 25 new Flexi-Van 85-foot flat cars and the Milwaushykee Motor added 75 new vans and 60 new bogies (wheel assemblies) The 85-foot flat cars were the first Flexi-Van cars of that length to be put into service in the industry

In mid-year Milwaukee Motor received delivery of 25 new mechanically refrigershyated Flexi-Van units equipped with dual temperature controls so they also can be heated for wintertime shipping of perishable commodities In addition 12 Milwaukee Motor insulated vans that already were in FIexi-Van service were converted into refrigshyerated trailers with the addition of mechanical refrigeration units

The deliveries of Flexi-Van units brought the Flexi-Van fleet to a total of 64 special flat cars and Milwaukee Motors fleet to a total of 221 vans and 142 bogies

Additions were made to the fleet of conventional piggybacking cars in 1960 by the conversion in the Milwaukee shops of a total of 121 flat cars to that type of operation Important in the speeding of transcontinental piggybacking of new automobiles by the Milwaukee from Chicago to the Pacific northwest was the lowering of the track through the eighty-five year old tunnel at Tunnel City Wis by 26 inches providing clearance for the automobile shipments

The larger clearance created by the project permitted the railroad to step up its schedules for the auto piggybacking and for other high dimension loads on the Chicago-Milwaukee-Twin Cities route The project which was completed in record time involved the re-Iaying of 3200 feet of track

In 1960 a coordinated rail-truck operation was developed in Washington The operation involves the transporting of bulk cement and of steel special equipment and machinery

This service is provided by a subsidiary-The Milwaukee Motor Transportation Company-which uses tractors and semi-trailers for the major part of the hauling Cranes transfer heavy equipment from rail cars to the motor carrier units

During 1960 Milwaukee Motor hauled a substantial number of carloads of cement steel special equipment and machinery from railheads to construction sites

This is an excellent example of how a railroad has tailored its services to meet the needs of shippers and consignees and retain business that otherwise would have been diverted to competitors In this instance the Milwaukee provides the link between the railhead and off-track construction sites thus handling the entire movement to the satisfaction of the contractors involved The efficiency of the operation is enhanced for the contractor because he has to do business with only one carrier

6

_ ~ I I

II I

A one million dollar spot system facility for repairing freight cars was placed in operation at the Bensenville Ill yards early in November Its completion marked another advance in the adoption of ultramodern techniques for speeding freight moveshyments for shippers and at lower cost to the railroad

The facility is one of the largest of its type in the country and the first to be inshystalled on a railroad serving the Northwest region The so-called one-spot repair system new in concept and practice is based on the principle of moving cars to men and material rather than men taking material to cars

The system is a compact layout featuring a 120 by 120 foot shop building with four servicing tracks Each of the tracks is equipped with two electric power winches that pull the cars to and from the shop building by means of between-the-rail cables attached to axle engaging devices known as rabbits The operation is controlled from a push button panel located at trackside in the building

Tools parts and equipment are assembled in one sheltered location to which cars are brought in a continuous flow All repairs are performed in the building with work going forward on the cars one at a time on the individual tracks The facility can be operated in all kinds of weather 24 hours a day

In 1960 the Milwaukee purchased new freight cars to meet the growing demand for longer and larger capacity rolling stock at a total cost of $9994400 A total of 775 new cars of various types was added to the fleet including 500 new wide door box cars 100 new covered hopper cars 100 general purpose flatcars of 60 foot length 50 damage free freight cars and 25 gondola cars

The 500 new box cars featuring doors which can be opened to a width of 15 feet 2 inches brought the Milwaukees total ownership of this highly versatile type to 1500

All the new freight cars purchased in 1960 had a capacity of 70 tons each and were equipped with roller bearings

An upgrading program carried out in Milwaukee included the rebuilding of 50-ton refrigerator cars 70-ton mill type gondola cars and 70-ton hopper type cars along with various other types of changes and additions to provide a wider and better service to shippers The major project in the Tacoma shops was the upgrading and repair of double door cars of 40 and 50 foot lengths

Delivery will start this spring on 40 new double-deck passenger cars ordered for suburban service from The Budd Company Philadelphia Pa at a cost of approxishymately six million dollars

The order for the new cars placed shortly after the approval of a fare increase last spring by the Illinois Commerce Commission was the first big step in the commuter service modernization program which looks toward the eventual replacement as earnshyings permit of all the present suburban cars with new double deck coaches

7

~- I II I j I III 1II~JII I ~ ~ I III~ I II I1III

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY General Offices-516 W Jackson Boulevard Chicago 6 Illinois

Terms Expiring 1961 1962 1963

E AINSWORTH EYRE ARTHUR S BOWES JOHN D ALLEN ] PATRICK LANNAN JEROME C EpPLER JAMES M BARKER JAMES D NORRIS JOHN B GALLAGHER LEO T CROWLEY WILLIAM 1 OBRIEN JOSHUA GREEN WALTER] CUMMINGS PHILIP W PILLSBURY ARNOLD B KELLER WILLIAM] FROELICH FRANKLIN B SCHMICK WALTER T MAHONEY WILLIAM] QUINN JOHN P WAGNER LOUIS QUARLES ARTHUR M WIRTZ

WILLIAM] SINEK

] PATRICK LANNAN Chairman JOHN D ALLEN WILLIAM] FROELICH WILLIAM] QUINN LEO T CROWLEY JOHN B GALLAGHER WILLIAM] SINEK WALTER] CUMMINGS ARTHUR M WIRTZ

WALTER] CUMMINGS Chairman JOHN D ALLEN JEROME C EpPLER ] PATRICK LANNAN JAMES M BARKER WILLIAM] FROELICH LOUIS QUARLES LEO T CROWLEY JOHN B GALLAGHER JOHN P WAGNER

ARNOLD B KELLER ARTHUR M WIRTZAlternate Members

1 T CROWLEY Chairman of the Board CHICAGO W] QUINN President CHICAGO W W KREMER Vice President-Traffic CHICAGO E R ECKERSALL Vice President and General Counsel CHICAGO F G MCGINN P H DRAVER

Vice President-Operation Vice President-Industrial Development

CHICAGO CHICAGO

R S STEPHENSON Vice President-Finance and Accounting CHICAGO 1 H DUGAN Vice President and Western Counsel SEATTLE E O SCHIEWE General Solicitor CHICAGO R F KRATOCHWILL J] ROCHE C T LANNON

Comptroller Secretary Treasurer

CHICAGO CHICAGO CHICAGO

The Chase Manhattan Bank New York 15 NY The First National City Bank of New York Room 732 Union Station Chicago 6 Ill New York 15 NY

Continental Illinois National Bank and Trust Company of Chicago Chicago 90 Ill

May 9 1961 Chicago Illinois

This Annual Report is not and must not be considered as proxy soliciting material or as a report or document filed pursuant to the Securities Exchange Act or any rule or regulation thereunder

1960 1959

Operating revenues $230362902 Operating expenses 187929803 Taxes Federal State and Local 20137000 Net railway operating income 9654308 Other income-Net 3588037 Income available for fixed charges 13242345 Fixed charges 5677502 Contingent charges 6241780

$242041825 198851581 19415000 13651274 4047361

17698635 5471962 6351497

Net income Net income per share-Series A Preferred

-Common Times fixed charges earned

$

1323063 255

o 233

$ 5875176 1133

155 323

Dividends paid Series A Preferred-$500 per share Common-$150 per share

Total dividends paid Number of stockholders as December 31

Series A Preferred Common

Out of earnings of the prior year

$

2593260 3184872 5778132

5015 10649

$ 2593260 3184871 5778131

5089 9902

Gross capital expenditures For road property improvements For equipment

Total

$

6123291 13966899 20090190

$ 5940814 21733124 27673938

Traffic statistics Net ton-miles of revenue freight (thousands) 13605766 Freight revenue $189560907 Passengers carried one mile 627831562 Passenger revenue $ 15174969

14123258 $201536333 648200824

$ 15282171

Total amount of payroll $121135807 Average number of employees 20229

$128399667 22243

Gross ton miles per train-hour Gross tons per train Net ton-miles per train-hour Net tons per train

(Indices of freight-train performance)

66674 3305

29255 1450

64565 3228

28570 1428

2

-

shy -I -~tmiddot - I ~i ~ I III t I I II 111 11 I I I

-shy

In the face of a general recession which sharply reduced railroad revenues in 1960 the Milwaukee Road successfully effected a balshyanced reduction in expenses and built securely on a strong foundation for the future Improveshyments were introduced to provide the public with the best in service and the property was maintained in condition to take full advantage of the business upturn anticipated for 1961

The general reduction in railroad carloadings as business slowed intensified the problem of underutilization of plant and equipment

The actual extent of the decline in earnings and revenues came as a disappointment The reduction in earnings was due entirely to lower revenues which amounted to $230362902 compared with $242041825 in 1959 a reducshytion of $11678923 Through rigid economies operating expenses were likewise reduced by $10921778 from the 1959 level It was not possible however to completely offset the efshyfect of the decline in revenues with the result that net income in 1960 amounted to $1323063 compared with $5875176 in 1959

On February 23 1961 the Board of Direcshyrors declared a dividend out of the 1960 earnshyings or out of the accumulated earned surplus of the Corporation for prior calendar years of $500 per share on the Series A preferred stock payable in four installments of $125 per share each on March 30 June 29 September 28 and November 30 in 1961 to holders of record at the close of business March 10 June 9 Sepshytember 8 and November 10 1961 respectively

Declaration of a dividend on the Common Stock has been deferred until a better appraisal can be made of future business conditions both generally and in the railroad industry

The outlook for 1961 is more favorable There is already indication that housing starts will be up to some extent and we can reasonshyably expect some improvement in the moveshyments of lumber and other forest products In this freight category which is of major imshyportance to the Milwaukee Road our 1960 revenues were down 162 from 1959

3

Other unfavorable factors in 1960 were the slump in the iron and steel industry resulting in decreased revenues from the smaller traffic in many manufactured products and the disshyappointing showing of the grain movement The latter situation developed despite a good grain crop in Milwaukee Road territory beshycause of a decline in government grain releases particularly in the last months of the year

Improvement in any of these three major freight categories could result in a welcome upturn in 1961 A very substantial volume of small grains and corn remains in farm and country elevator storage on the Milwaukee Road for eventual movement to market The Milwaukee Road is in a strong position to take advantage of the better business conditions now generally predicted for the months ahead The improvement program of the last several years has modernized plant and equipment We have the tools to render improved service to shippers and to meet competition

Another noteworthy feature has been the aggressiveness of the campaign to develop new freight traffic and win back business from comshypeting forms of transport Many of these acshytivities should make themselves felt in still greater measure during 1961

For example the Milwaukee Road has moved ahead in providing rail-truck delivery by a single carrier to remote heavy construction sites such as power and irrigation dams and other government projects We are actively seekshying business of this kind and it should add appreciably to revenues in the next year or two

Transport of automobiles is another example of Milwaukee leadership in winning traffic to the rails As a consequence revenues from auto shipments were up $2760468 in 1960 These and other developments of the year illustrate the alertness with which new facilities equipshyment and services are being employed to build business This creative approach to railroading will be decisive as the economy turns up again to insure that the Milwaukee Road takes full advantage of new opportunities

Joint merger studies with the Rock Island Lines begun in 1959 were continued and inshytensmed in 1960 Toward the end of the year however it became evident that effecting a merger of the two systems would be a timeshyconsuming project in the face of the unforeseen obstacles that had been encountered

Since then merger discussions have been initiated between the managements of the Milshywaukee Road and the Chicago and North Westshyern Railway As of the date of this report the roads have not yet reached an agreement

Railroads continue to form the backbone of the common carrier system Their ability to move large tonnages of raw materials and manshyufactured goods at low cost on equal terms to all shippers is a necessity if we are to keep this continent one great mass market

In light of these facts there is urgent need

to review public transportation policy We must face the reality that no form of transport today has anything like a monopoly and regulations based on conditions of half a century ago are dangerously out of date Instead of artificial restrictions transportation companies should be given every encouragement to use the most modern devices and equipment for moving goods and people by whatever combination of methods is efficient

Nothing could be more important to the future of the Milwaukee Road or any other common carrier than a basic understanding by shippers and the public of the urgency of these problems It is time to clear away the misconshyceptions and outmoded regulations that bar the way to progress so that we may enter upon a new era of transportation efficiency and profitshyability

Chairman of the Board

By order of the Board of Directors March 16 1961

4

The Milwaukee Road is the railroad of the Creative Crews The sum total of the efforts of these crews-out on the line in the shops and in the offices-is a smooth working closely knit effishycient transportation unit

The services and operation of Carscope established late in 1959 were expanded substantially during 1960 The original function was centered on the tracing of the movement of all carloads over the system to provide up-to-the-minute information on the location and movement of all carload freight for shippers and receivers anyshywhere in the United States Since the center started operations other uses of the data provided have been developed through additional sorting and assembly of punched card data

The program of conversion to an electronic data processing system moved ahead in 1960 toward an operational goal in the second half of 1961 Major accounting processes are being redesigned to integrate related functions simplify procedures speed the flow of data and in general achieve maximum benefit from central processing on new electronic equipment Testing of programming for the IBM 7070 computer was started late in the year

The last of nine regional data offices was recently established completing a program started in mid-1960 to provide a means of moving basic information more rapidly from dispersed source points to the central computer Each office will gather freight revenue payroll and material data in its area and transmit over telephone lines to Chicago In addition freight billing and collection operations are being transferred to the regional offices from the hundreds of local agencies with attendant advantages from concentration and specialization of functions

The computer center at Chicago will also use freight movement information fed in hourly by teletype from 36 key yard offices equipped with punched-card and transmission equipment In addition to accounting outputs and control statistics the computer will develop from such input all reports needed by Carscope as well as reports designed to aid in the distribution of empty freight cars

New types of sales kits unique in the railroad industry provide traffic solicitors with visual aids in the form of pictures maps diagrams and colored leaflets graphishycally presenting the services of the railroad

New traffic department offices opened in 1960 were sales and service units estabshylished in Birmingham Ala and Memphis Tenn

5

Trailer-on-flat car services to shippers were broadened substantially in 1960 by the use of Flexi-Van conventional piggybacking and containerization The Flexi-Van fleet has been expanded four times since the inception of that service a little over two years ago In order to widen its piggyback service the railroad joined in 1960 the national equipment pools of Trailer Train Company and North American Car Corporashytion which provide flat cars for piggyback movements

The transcontinental piggybacking of automobiles which the railroad started early in 1960 expanded greatly during the course of the year

Deliveries of new Flexi-Van equipment to the Milwaukee Road and its subsidiary - The Milwaukee Motor Transportation Company-were substantial during 1960 Early in the year the railroad added 25 new Flexi-Van 85-foot flat cars and the Milwaushykee Motor added 75 new vans and 60 new bogies (wheel assemblies) The 85-foot flat cars were the first Flexi-Van cars of that length to be put into service in the industry

In mid-year Milwaukee Motor received delivery of 25 new mechanically refrigershyated Flexi-Van units equipped with dual temperature controls so they also can be heated for wintertime shipping of perishable commodities In addition 12 Milwaukee Motor insulated vans that already were in FIexi-Van service were converted into refrigshyerated trailers with the addition of mechanical refrigeration units

The deliveries of Flexi-Van units brought the Flexi-Van fleet to a total of 64 special flat cars and Milwaukee Motors fleet to a total of 221 vans and 142 bogies

Additions were made to the fleet of conventional piggybacking cars in 1960 by the conversion in the Milwaukee shops of a total of 121 flat cars to that type of operation Important in the speeding of transcontinental piggybacking of new automobiles by the Milwaukee from Chicago to the Pacific northwest was the lowering of the track through the eighty-five year old tunnel at Tunnel City Wis by 26 inches providing clearance for the automobile shipments

The larger clearance created by the project permitted the railroad to step up its schedules for the auto piggybacking and for other high dimension loads on the Chicago-Milwaukee-Twin Cities route The project which was completed in record time involved the re-Iaying of 3200 feet of track

In 1960 a coordinated rail-truck operation was developed in Washington The operation involves the transporting of bulk cement and of steel special equipment and machinery

This service is provided by a subsidiary-The Milwaukee Motor Transportation Company-which uses tractors and semi-trailers for the major part of the hauling Cranes transfer heavy equipment from rail cars to the motor carrier units

During 1960 Milwaukee Motor hauled a substantial number of carloads of cement steel special equipment and machinery from railheads to construction sites

This is an excellent example of how a railroad has tailored its services to meet the needs of shippers and consignees and retain business that otherwise would have been diverted to competitors In this instance the Milwaukee provides the link between the railhead and off-track construction sites thus handling the entire movement to the satisfaction of the contractors involved The efficiency of the operation is enhanced for the contractor because he has to do business with only one carrier

6

_ ~ I I

II I

A one million dollar spot system facility for repairing freight cars was placed in operation at the Bensenville Ill yards early in November Its completion marked another advance in the adoption of ultramodern techniques for speeding freight moveshyments for shippers and at lower cost to the railroad

The facility is one of the largest of its type in the country and the first to be inshystalled on a railroad serving the Northwest region The so-called one-spot repair system new in concept and practice is based on the principle of moving cars to men and material rather than men taking material to cars

The system is a compact layout featuring a 120 by 120 foot shop building with four servicing tracks Each of the tracks is equipped with two electric power winches that pull the cars to and from the shop building by means of between-the-rail cables attached to axle engaging devices known as rabbits The operation is controlled from a push button panel located at trackside in the building

Tools parts and equipment are assembled in one sheltered location to which cars are brought in a continuous flow All repairs are performed in the building with work going forward on the cars one at a time on the individual tracks The facility can be operated in all kinds of weather 24 hours a day

In 1960 the Milwaukee purchased new freight cars to meet the growing demand for longer and larger capacity rolling stock at a total cost of $9994400 A total of 775 new cars of various types was added to the fleet including 500 new wide door box cars 100 new covered hopper cars 100 general purpose flatcars of 60 foot length 50 damage free freight cars and 25 gondola cars

The 500 new box cars featuring doors which can be opened to a width of 15 feet 2 inches brought the Milwaukees total ownership of this highly versatile type to 1500

All the new freight cars purchased in 1960 had a capacity of 70 tons each and were equipped with roller bearings

An upgrading program carried out in Milwaukee included the rebuilding of 50-ton refrigerator cars 70-ton mill type gondola cars and 70-ton hopper type cars along with various other types of changes and additions to provide a wider and better service to shippers The major project in the Tacoma shops was the upgrading and repair of double door cars of 40 and 50 foot lengths

Delivery will start this spring on 40 new double-deck passenger cars ordered for suburban service from The Budd Company Philadelphia Pa at a cost of approxishymately six million dollars

The order for the new cars placed shortly after the approval of a fare increase last spring by the Illinois Commerce Commission was the first big step in the commuter service modernization program which looks toward the eventual replacement as earnshyings permit of all the present suburban cars with new double deck coaches

7

~- I II I j I III 1II~JII I ~ ~ I III~ I II I1III

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

1960 1959

Operating revenues $230362902 Operating expenses 187929803 Taxes Federal State and Local 20137000 Net railway operating income 9654308 Other income-Net 3588037 Income available for fixed charges 13242345 Fixed charges 5677502 Contingent charges 6241780

$242041825 198851581 19415000 13651274 4047361

17698635 5471962 6351497

Net income Net income per share-Series A Preferred

-Common Times fixed charges earned

$

1323063 255

o 233

$ 5875176 1133

155 323

Dividends paid Series A Preferred-$500 per share Common-$150 per share

Total dividends paid Number of stockholders as December 31

Series A Preferred Common

Out of earnings of the prior year

$

2593260 3184872 5778132

5015 10649

$ 2593260 3184871 5778131

5089 9902

Gross capital expenditures For road property improvements For equipment

Total

$

6123291 13966899 20090190

$ 5940814 21733124 27673938

Traffic statistics Net ton-miles of revenue freight (thousands) 13605766 Freight revenue $189560907 Passengers carried one mile 627831562 Passenger revenue $ 15174969

14123258 $201536333 648200824

$ 15282171

Total amount of payroll $121135807 Average number of employees 20229

$128399667 22243

Gross ton miles per train-hour Gross tons per train Net ton-miles per train-hour Net tons per train

(Indices of freight-train performance)

66674 3305

29255 1450

64565 3228

28570 1428

2

-

shy -I -~tmiddot - I ~i ~ I III t I I II 111 11 I I I

-shy

In the face of a general recession which sharply reduced railroad revenues in 1960 the Milwaukee Road successfully effected a balshyanced reduction in expenses and built securely on a strong foundation for the future Improveshyments were introduced to provide the public with the best in service and the property was maintained in condition to take full advantage of the business upturn anticipated for 1961

The general reduction in railroad carloadings as business slowed intensified the problem of underutilization of plant and equipment

The actual extent of the decline in earnings and revenues came as a disappointment The reduction in earnings was due entirely to lower revenues which amounted to $230362902 compared with $242041825 in 1959 a reducshytion of $11678923 Through rigid economies operating expenses were likewise reduced by $10921778 from the 1959 level It was not possible however to completely offset the efshyfect of the decline in revenues with the result that net income in 1960 amounted to $1323063 compared with $5875176 in 1959

On February 23 1961 the Board of Direcshyrors declared a dividend out of the 1960 earnshyings or out of the accumulated earned surplus of the Corporation for prior calendar years of $500 per share on the Series A preferred stock payable in four installments of $125 per share each on March 30 June 29 September 28 and November 30 in 1961 to holders of record at the close of business March 10 June 9 Sepshytember 8 and November 10 1961 respectively

Declaration of a dividend on the Common Stock has been deferred until a better appraisal can be made of future business conditions both generally and in the railroad industry

The outlook for 1961 is more favorable There is already indication that housing starts will be up to some extent and we can reasonshyably expect some improvement in the moveshyments of lumber and other forest products In this freight category which is of major imshyportance to the Milwaukee Road our 1960 revenues were down 162 from 1959

3

Other unfavorable factors in 1960 were the slump in the iron and steel industry resulting in decreased revenues from the smaller traffic in many manufactured products and the disshyappointing showing of the grain movement The latter situation developed despite a good grain crop in Milwaukee Road territory beshycause of a decline in government grain releases particularly in the last months of the year

Improvement in any of these three major freight categories could result in a welcome upturn in 1961 A very substantial volume of small grains and corn remains in farm and country elevator storage on the Milwaukee Road for eventual movement to market The Milwaukee Road is in a strong position to take advantage of the better business conditions now generally predicted for the months ahead The improvement program of the last several years has modernized plant and equipment We have the tools to render improved service to shippers and to meet competition

Another noteworthy feature has been the aggressiveness of the campaign to develop new freight traffic and win back business from comshypeting forms of transport Many of these acshytivities should make themselves felt in still greater measure during 1961

For example the Milwaukee Road has moved ahead in providing rail-truck delivery by a single carrier to remote heavy construction sites such as power and irrigation dams and other government projects We are actively seekshying business of this kind and it should add appreciably to revenues in the next year or two

Transport of automobiles is another example of Milwaukee leadership in winning traffic to the rails As a consequence revenues from auto shipments were up $2760468 in 1960 These and other developments of the year illustrate the alertness with which new facilities equipshyment and services are being employed to build business This creative approach to railroading will be decisive as the economy turns up again to insure that the Milwaukee Road takes full advantage of new opportunities

Joint merger studies with the Rock Island Lines begun in 1959 were continued and inshytensmed in 1960 Toward the end of the year however it became evident that effecting a merger of the two systems would be a timeshyconsuming project in the face of the unforeseen obstacles that had been encountered

Since then merger discussions have been initiated between the managements of the Milshywaukee Road and the Chicago and North Westshyern Railway As of the date of this report the roads have not yet reached an agreement

Railroads continue to form the backbone of the common carrier system Their ability to move large tonnages of raw materials and manshyufactured goods at low cost on equal terms to all shippers is a necessity if we are to keep this continent one great mass market

In light of these facts there is urgent need

to review public transportation policy We must face the reality that no form of transport today has anything like a monopoly and regulations based on conditions of half a century ago are dangerously out of date Instead of artificial restrictions transportation companies should be given every encouragement to use the most modern devices and equipment for moving goods and people by whatever combination of methods is efficient

Nothing could be more important to the future of the Milwaukee Road or any other common carrier than a basic understanding by shippers and the public of the urgency of these problems It is time to clear away the misconshyceptions and outmoded regulations that bar the way to progress so that we may enter upon a new era of transportation efficiency and profitshyability

Chairman of the Board

By order of the Board of Directors March 16 1961

4

The Milwaukee Road is the railroad of the Creative Crews The sum total of the efforts of these crews-out on the line in the shops and in the offices-is a smooth working closely knit effishycient transportation unit

The services and operation of Carscope established late in 1959 were expanded substantially during 1960 The original function was centered on the tracing of the movement of all carloads over the system to provide up-to-the-minute information on the location and movement of all carload freight for shippers and receivers anyshywhere in the United States Since the center started operations other uses of the data provided have been developed through additional sorting and assembly of punched card data

The program of conversion to an electronic data processing system moved ahead in 1960 toward an operational goal in the second half of 1961 Major accounting processes are being redesigned to integrate related functions simplify procedures speed the flow of data and in general achieve maximum benefit from central processing on new electronic equipment Testing of programming for the IBM 7070 computer was started late in the year

The last of nine regional data offices was recently established completing a program started in mid-1960 to provide a means of moving basic information more rapidly from dispersed source points to the central computer Each office will gather freight revenue payroll and material data in its area and transmit over telephone lines to Chicago In addition freight billing and collection operations are being transferred to the regional offices from the hundreds of local agencies with attendant advantages from concentration and specialization of functions

The computer center at Chicago will also use freight movement information fed in hourly by teletype from 36 key yard offices equipped with punched-card and transmission equipment In addition to accounting outputs and control statistics the computer will develop from such input all reports needed by Carscope as well as reports designed to aid in the distribution of empty freight cars

New types of sales kits unique in the railroad industry provide traffic solicitors with visual aids in the form of pictures maps diagrams and colored leaflets graphishycally presenting the services of the railroad

New traffic department offices opened in 1960 were sales and service units estabshylished in Birmingham Ala and Memphis Tenn

5

Trailer-on-flat car services to shippers were broadened substantially in 1960 by the use of Flexi-Van conventional piggybacking and containerization The Flexi-Van fleet has been expanded four times since the inception of that service a little over two years ago In order to widen its piggyback service the railroad joined in 1960 the national equipment pools of Trailer Train Company and North American Car Corporashytion which provide flat cars for piggyback movements

The transcontinental piggybacking of automobiles which the railroad started early in 1960 expanded greatly during the course of the year

Deliveries of new Flexi-Van equipment to the Milwaukee Road and its subsidiary - The Milwaukee Motor Transportation Company-were substantial during 1960 Early in the year the railroad added 25 new Flexi-Van 85-foot flat cars and the Milwaushykee Motor added 75 new vans and 60 new bogies (wheel assemblies) The 85-foot flat cars were the first Flexi-Van cars of that length to be put into service in the industry

In mid-year Milwaukee Motor received delivery of 25 new mechanically refrigershyated Flexi-Van units equipped with dual temperature controls so they also can be heated for wintertime shipping of perishable commodities In addition 12 Milwaukee Motor insulated vans that already were in FIexi-Van service were converted into refrigshyerated trailers with the addition of mechanical refrigeration units

The deliveries of Flexi-Van units brought the Flexi-Van fleet to a total of 64 special flat cars and Milwaukee Motors fleet to a total of 221 vans and 142 bogies

Additions were made to the fleet of conventional piggybacking cars in 1960 by the conversion in the Milwaukee shops of a total of 121 flat cars to that type of operation Important in the speeding of transcontinental piggybacking of new automobiles by the Milwaukee from Chicago to the Pacific northwest was the lowering of the track through the eighty-five year old tunnel at Tunnel City Wis by 26 inches providing clearance for the automobile shipments

The larger clearance created by the project permitted the railroad to step up its schedules for the auto piggybacking and for other high dimension loads on the Chicago-Milwaukee-Twin Cities route The project which was completed in record time involved the re-Iaying of 3200 feet of track

In 1960 a coordinated rail-truck operation was developed in Washington The operation involves the transporting of bulk cement and of steel special equipment and machinery

This service is provided by a subsidiary-The Milwaukee Motor Transportation Company-which uses tractors and semi-trailers for the major part of the hauling Cranes transfer heavy equipment from rail cars to the motor carrier units

During 1960 Milwaukee Motor hauled a substantial number of carloads of cement steel special equipment and machinery from railheads to construction sites

This is an excellent example of how a railroad has tailored its services to meet the needs of shippers and consignees and retain business that otherwise would have been diverted to competitors In this instance the Milwaukee provides the link between the railhead and off-track construction sites thus handling the entire movement to the satisfaction of the contractors involved The efficiency of the operation is enhanced for the contractor because he has to do business with only one carrier

6

_ ~ I I

II I

A one million dollar spot system facility for repairing freight cars was placed in operation at the Bensenville Ill yards early in November Its completion marked another advance in the adoption of ultramodern techniques for speeding freight moveshyments for shippers and at lower cost to the railroad

The facility is one of the largest of its type in the country and the first to be inshystalled on a railroad serving the Northwest region The so-called one-spot repair system new in concept and practice is based on the principle of moving cars to men and material rather than men taking material to cars

The system is a compact layout featuring a 120 by 120 foot shop building with four servicing tracks Each of the tracks is equipped with two electric power winches that pull the cars to and from the shop building by means of between-the-rail cables attached to axle engaging devices known as rabbits The operation is controlled from a push button panel located at trackside in the building

Tools parts and equipment are assembled in one sheltered location to which cars are brought in a continuous flow All repairs are performed in the building with work going forward on the cars one at a time on the individual tracks The facility can be operated in all kinds of weather 24 hours a day

In 1960 the Milwaukee purchased new freight cars to meet the growing demand for longer and larger capacity rolling stock at a total cost of $9994400 A total of 775 new cars of various types was added to the fleet including 500 new wide door box cars 100 new covered hopper cars 100 general purpose flatcars of 60 foot length 50 damage free freight cars and 25 gondola cars

The 500 new box cars featuring doors which can be opened to a width of 15 feet 2 inches brought the Milwaukees total ownership of this highly versatile type to 1500

All the new freight cars purchased in 1960 had a capacity of 70 tons each and were equipped with roller bearings

An upgrading program carried out in Milwaukee included the rebuilding of 50-ton refrigerator cars 70-ton mill type gondola cars and 70-ton hopper type cars along with various other types of changes and additions to provide a wider and better service to shippers The major project in the Tacoma shops was the upgrading and repair of double door cars of 40 and 50 foot lengths

Delivery will start this spring on 40 new double-deck passenger cars ordered for suburban service from The Budd Company Philadelphia Pa at a cost of approxishymately six million dollars

The order for the new cars placed shortly after the approval of a fare increase last spring by the Illinois Commerce Commission was the first big step in the commuter service modernization program which looks toward the eventual replacement as earnshyings permit of all the present suburban cars with new double deck coaches

7

~- I II I j I III 1II~JII I ~ ~ I III~ I II I1III

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

In the face of a general recession which sharply reduced railroad revenues in 1960 the Milwaukee Road successfully effected a balshyanced reduction in expenses and built securely on a strong foundation for the future Improveshyments were introduced to provide the public with the best in service and the property was maintained in condition to take full advantage of the business upturn anticipated for 1961

The general reduction in railroad carloadings as business slowed intensified the problem of underutilization of plant and equipment

The actual extent of the decline in earnings and revenues came as a disappointment The reduction in earnings was due entirely to lower revenues which amounted to $230362902 compared with $242041825 in 1959 a reducshytion of $11678923 Through rigid economies operating expenses were likewise reduced by $10921778 from the 1959 level It was not possible however to completely offset the efshyfect of the decline in revenues with the result that net income in 1960 amounted to $1323063 compared with $5875176 in 1959

On February 23 1961 the Board of Direcshyrors declared a dividend out of the 1960 earnshyings or out of the accumulated earned surplus of the Corporation for prior calendar years of $500 per share on the Series A preferred stock payable in four installments of $125 per share each on March 30 June 29 September 28 and November 30 in 1961 to holders of record at the close of business March 10 June 9 Sepshytember 8 and November 10 1961 respectively

Declaration of a dividend on the Common Stock has been deferred until a better appraisal can be made of future business conditions both generally and in the railroad industry

The outlook for 1961 is more favorable There is already indication that housing starts will be up to some extent and we can reasonshyably expect some improvement in the moveshyments of lumber and other forest products In this freight category which is of major imshyportance to the Milwaukee Road our 1960 revenues were down 162 from 1959

3

Other unfavorable factors in 1960 were the slump in the iron and steel industry resulting in decreased revenues from the smaller traffic in many manufactured products and the disshyappointing showing of the grain movement The latter situation developed despite a good grain crop in Milwaukee Road territory beshycause of a decline in government grain releases particularly in the last months of the year

Improvement in any of these three major freight categories could result in a welcome upturn in 1961 A very substantial volume of small grains and corn remains in farm and country elevator storage on the Milwaukee Road for eventual movement to market The Milwaukee Road is in a strong position to take advantage of the better business conditions now generally predicted for the months ahead The improvement program of the last several years has modernized plant and equipment We have the tools to render improved service to shippers and to meet competition

Another noteworthy feature has been the aggressiveness of the campaign to develop new freight traffic and win back business from comshypeting forms of transport Many of these acshytivities should make themselves felt in still greater measure during 1961

For example the Milwaukee Road has moved ahead in providing rail-truck delivery by a single carrier to remote heavy construction sites such as power and irrigation dams and other government projects We are actively seekshying business of this kind and it should add appreciably to revenues in the next year or two

Transport of automobiles is another example of Milwaukee leadership in winning traffic to the rails As a consequence revenues from auto shipments were up $2760468 in 1960 These and other developments of the year illustrate the alertness with which new facilities equipshyment and services are being employed to build business This creative approach to railroading will be decisive as the economy turns up again to insure that the Milwaukee Road takes full advantage of new opportunities

Joint merger studies with the Rock Island Lines begun in 1959 were continued and inshytensmed in 1960 Toward the end of the year however it became evident that effecting a merger of the two systems would be a timeshyconsuming project in the face of the unforeseen obstacles that had been encountered

Since then merger discussions have been initiated between the managements of the Milshywaukee Road and the Chicago and North Westshyern Railway As of the date of this report the roads have not yet reached an agreement

Railroads continue to form the backbone of the common carrier system Their ability to move large tonnages of raw materials and manshyufactured goods at low cost on equal terms to all shippers is a necessity if we are to keep this continent one great mass market

In light of these facts there is urgent need

to review public transportation policy We must face the reality that no form of transport today has anything like a monopoly and regulations based on conditions of half a century ago are dangerously out of date Instead of artificial restrictions transportation companies should be given every encouragement to use the most modern devices and equipment for moving goods and people by whatever combination of methods is efficient

Nothing could be more important to the future of the Milwaukee Road or any other common carrier than a basic understanding by shippers and the public of the urgency of these problems It is time to clear away the misconshyceptions and outmoded regulations that bar the way to progress so that we may enter upon a new era of transportation efficiency and profitshyability

Chairman of the Board

By order of the Board of Directors March 16 1961

4

The Milwaukee Road is the railroad of the Creative Crews The sum total of the efforts of these crews-out on the line in the shops and in the offices-is a smooth working closely knit effishycient transportation unit

The services and operation of Carscope established late in 1959 were expanded substantially during 1960 The original function was centered on the tracing of the movement of all carloads over the system to provide up-to-the-minute information on the location and movement of all carload freight for shippers and receivers anyshywhere in the United States Since the center started operations other uses of the data provided have been developed through additional sorting and assembly of punched card data

The program of conversion to an electronic data processing system moved ahead in 1960 toward an operational goal in the second half of 1961 Major accounting processes are being redesigned to integrate related functions simplify procedures speed the flow of data and in general achieve maximum benefit from central processing on new electronic equipment Testing of programming for the IBM 7070 computer was started late in the year

The last of nine regional data offices was recently established completing a program started in mid-1960 to provide a means of moving basic information more rapidly from dispersed source points to the central computer Each office will gather freight revenue payroll and material data in its area and transmit over telephone lines to Chicago In addition freight billing and collection operations are being transferred to the regional offices from the hundreds of local agencies with attendant advantages from concentration and specialization of functions

The computer center at Chicago will also use freight movement information fed in hourly by teletype from 36 key yard offices equipped with punched-card and transmission equipment In addition to accounting outputs and control statistics the computer will develop from such input all reports needed by Carscope as well as reports designed to aid in the distribution of empty freight cars

New types of sales kits unique in the railroad industry provide traffic solicitors with visual aids in the form of pictures maps diagrams and colored leaflets graphishycally presenting the services of the railroad

New traffic department offices opened in 1960 were sales and service units estabshylished in Birmingham Ala and Memphis Tenn

5

Trailer-on-flat car services to shippers were broadened substantially in 1960 by the use of Flexi-Van conventional piggybacking and containerization The Flexi-Van fleet has been expanded four times since the inception of that service a little over two years ago In order to widen its piggyback service the railroad joined in 1960 the national equipment pools of Trailer Train Company and North American Car Corporashytion which provide flat cars for piggyback movements

The transcontinental piggybacking of automobiles which the railroad started early in 1960 expanded greatly during the course of the year

Deliveries of new Flexi-Van equipment to the Milwaukee Road and its subsidiary - The Milwaukee Motor Transportation Company-were substantial during 1960 Early in the year the railroad added 25 new Flexi-Van 85-foot flat cars and the Milwaushykee Motor added 75 new vans and 60 new bogies (wheel assemblies) The 85-foot flat cars were the first Flexi-Van cars of that length to be put into service in the industry

In mid-year Milwaukee Motor received delivery of 25 new mechanically refrigershyated Flexi-Van units equipped with dual temperature controls so they also can be heated for wintertime shipping of perishable commodities In addition 12 Milwaukee Motor insulated vans that already were in FIexi-Van service were converted into refrigshyerated trailers with the addition of mechanical refrigeration units

The deliveries of Flexi-Van units brought the Flexi-Van fleet to a total of 64 special flat cars and Milwaukee Motors fleet to a total of 221 vans and 142 bogies

Additions were made to the fleet of conventional piggybacking cars in 1960 by the conversion in the Milwaukee shops of a total of 121 flat cars to that type of operation Important in the speeding of transcontinental piggybacking of new automobiles by the Milwaukee from Chicago to the Pacific northwest was the lowering of the track through the eighty-five year old tunnel at Tunnel City Wis by 26 inches providing clearance for the automobile shipments

The larger clearance created by the project permitted the railroad to step up its schedules for the auto piggybacking and for other high dimension loads on the Chicago-Milwaukee-Twin Cities route The project which was completed in record time involved the re-Iaying of 3200 feet of track

In 1960 a coordinated rail-truck operation was developed in Washington The operation involves the transporting of bulk cement and of steel special equipment and machinery

This service is provided by a subsidiary-The Milwaukee Motor Transportation Company-which uses tractors and semi-trailers for the major part of the hauling Cranes transfer heavy equipment from rail cars to the motor carrier units

During 1960 Milwaukee Motor hauled a substantial number of carloads of cement steel special equipment and machinery from railheads to construction sites

This is an excellent example of how a railroad has tailored its services to meet the needs of shippers and consignees and retain business that otherwise would have been diverted to competitors In this instance the Milwaukee provides the link between the railhead and off-track construction sites thus handling the entire movement to the satisfaction of the contractors involved The efficiency of the operation is enhanced for the contractor because he has to do business with only one carrier

6

_ ~ I I

II I

A one million dollar spot system facility for repairing freight cars was placed in operation at the Bensenville Ill yards early in November Its completion marked another advance in the adoption of ultramodern techniques for speeding freight moveshyments for shippers and at lower cost to the railroad

The facility is one of the largest of its type in the country and the first to be inshystalled on a railroad serving the Northwest region The so-called one-spot repair system new in concept and practice is based on the principle of moving cars to men and material rather than men taking material to cars

The system is a compact layout featuring a 120 by 120 foot shop building with four servicing tracks Each of the tracks is equipped with two electric power winches that pull the cars to and from the shop building by means of between-the-rail cables attached to axle engaging devices known as rabbits The operation is controlled from a push button panel located at trackside in the building

Tools parts and equipment are assembled in one sheltered location to which cars are brought in a continuous flow All repairs are performed in the building with work going forward on the cars one at a time on the individual tracks The facility can be operated in all kinds of weather 24 hours a day

In 1960 the Milwaukee purchased new freight cars to meet the growing demand for longer and larger capacity rolling stock at a total cost of $9994400 A total of 775 new cars of various types was added to the fleet including 500 new wide door box cars 100 new covered hopper cars 100 general purpose flatcars of 60 foot length 50 damage free freight cars and 25 gondola cars

The 500 new box cars featuring doors which can be opened to a width of 15 feet 2 inches brought the Milwaukees total ownership of this highly versatile type to 1500

All the new freight cars purchased in 1960 had a capacity of 70 tons each and were equipped with roller bearings

An upgrading program carried out in Milwaukee included the rebuilding of 50-ton refrigerator cars 70-ton mill type gondola cars and 70-ton hopper type cars along with various other types of changes and additions to provide a wider and better service to shippers The major project in the Tacoma shops was the upgrading and repair of double door cars of 40 and 50 foot lengths

Delivery will start this spring on 40 new double-deck passenger cars ordered for suburban service from The Budd Company Philadelphia Pa at a cost of approxishymately six million dollars

The order for the new cars placed shortly after the approval of a fare increase last spring by the Illinois Commerce Commission was the first big step in the commuter service modernization program which looks toward the eventual replacement as earnshyings permit of all the present suburban cars with new double deck coaches

7

~- I II I j I III 1II~JII I ~ ~ I III~ I II I1III

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

Joint merger studies with the Rock Island Lines begun in 1959 were continued and inshytensmed in 1960 Toward the end of the year however it became evident that effecting a merger of the two systems would be a timeshyconsuming project in the face of the unforeseen obstacles that had been encountered

Since then merger discussions have been initiated between the managements of the Milshywaukee Road and the Chicago and North Westshyern Railway As of the date of this report the roads have not yet reached an agreement

Railroads continue to form the backbone of the common carrier system Their ability to move large tonnages of raw materials and manshyufactured goods at low cost on equal terms to all shippers is a necessity if we are to keep this continent one great mass market

In light of these facts there is urgent need

to review public transportation policy We must face the reality that no form of transport today has anything like a monopoly and regulations based on conditions of half a century ago are dangerously out of date Instead of artificial restrictions transportation companies should be given every encouragement to use the most modern devices and equipment for moving goods and people by whatever combination of methods is efficient

Nothing could be more important to the future of the Milwaukee Road or any other common carrier than a basic understanding by shippers and the public of the urgency of these problems It is time to clear away the misconshyceptions and outmoded regulations that bar the way to progress so that we may enter upon a new era of transportation efficiency and profitshyability

Chairman of the Board

By order of the Board of Directors March 16 1961

4

The Milwaukee Road is the railroad of the Creative Crews The sum total of the efforts of these crews-out on the line in the shops and in the offices-is a smooth working closely knit effishycient transportation unit

The services and operation of Carscope established late in 1959 were expanded substantially during 1960 The original function was centered on the tracing of the movement of all carloads over the system to provide up-to-the-minute information on the location and movement of all carload freight for shippers and receivers anyshywhere in the United States Since the center started operations other uses of the data provided have been developed through additional sorting and assembly of punched card data

The program of conversion to an electronic data processing system moved ahead in 1960 toward an operational goal in the second half of 1961 Major accounting processes are being redesigned to integrate related functions simplify procedures speed the flow of data and in general achieve maximum benefit from central processing on new electronic equipment Testing of programming for the IBM 7070 computer was started late in the year

The last of nine regional data offices was recently established completing a program started in mid-1960 to provide a means of moving basic information more rapidly from dispersed source points to the central computer Each office will gather freight revenue payroll and material data in its area and transmit over telephone lines to Chicago In addition freight billing and collection operations are being transferred to the regional offices from the hundreds of local agencies with attendant advantages from concentration and specialization of functions

The computer center at Chicago will also use freight movement information fed in hourly by teletype from 36 key yard offices equipped with punched-card and transmission equipment In addition to accounting outputs and control statistics the computer will develop from such input all reports needed by Carscope as well as reports designed to aid in the distribution of empty freight cars

New types of sales kits unique in the railroad industry provide traffic solicitors with visual aids in the form of pictures maps diagrams and colored leaflets graphishycally presenting the services of the railroad

New traffic department offices opened in 1960 were sales and service units estabshylished in Birmingham Ala and Memphis Tenn

5

Trailer-on-flat car services to shippers were broadened substantially in 1960 by the use of Flexi-Van conventional piggybacking and containerization The Flexi-Van fleet has been expanded four times since the inception of that service a little over two years ago In order to widen its piggyback service the railroad joined in 1960 the national equipment pools of Trailer Train Company and North American Car Corporashytion which provide flat cars for piggyback movements

The transcontinental piggybacking of automobiles which the railroad started early in 1960 expanded greatly during the course of the year

Deliveries of new Flexi-Van equipment to the Milwaukee Road and its subsidiary - The Milwaukee Motor Transportation Company-were substantial during 1960 Early in the year the railroad added 25 new Flexi-Van 85-foot flat cars and the Milwaushykee Motor added 75 new vans and 60 new bogies (wheel assemblies) The 85-foot flat cars were the first Flexi-Van cars of that length to be put into service in the industry

In mid-year Milwaukee Motor received delivery of 25 new mechanically refrigershyated Flexi-Van units equipped with dual temperature controls so they also can be heated for wintertime shipping of perishable commodities In addition 12 Milwaukee Motor insulated vans that already were in FIexi-Van service were converted into refrigshyerated trailers with the addition of mechanical refrigeration units

The deliveries of Flexi-Van units brought the Flexi-Van fleet to a total of 64 special flat cars and Milwaukee Motors fleet to a total of 221 vans and 142 bogies

Additions were made to the fleet of conventional piggybacking cars in 1960 by the conversion in the Milwaukee shops of a total of 121 flat cars to that type of operation Important in the speeding of transcontinental piggybacking of new automobiles by the Milwaukee from Chicago to the Pacific northwest was the lowering of the track through the eighty-five year old tunnel at Tunnel City Wis by 26 inches providing clearance for the automobile shipments

The larger clearance created by the project permitted the railroad to step up its schedules for the auto piggybacking and for other high dimension loads on the Chicago-Milwaukee-Twin Cities route The project which was completed in record time involved the re-Iaying of 3200 feet of track

In 1960 a coordinated rail-truck operation was developed in Washington The operation involves the transporting of bulk cement and of steel special equipment and machinery

This service is provided by a subsidiary-The Milwaukee Motor Transportation Company-which uses tractors and semi-trailers for the major part of the hauling Cranes transfer heavy equipment from rail cars to the motor carrier units

During 1960 Milwaukee Motor hauled a substantial number of carloads of cement steel special equipment and machinery from railheads to construction sites

This is an excellent example of how a railroad has tailored its services to meet the needs of shippers and consignees and retain business that otherwise would have been diverted to competitors In this instance the Milwaukee provides the link between the railhead and off-track construction sites thus handling the entire movement to the satisfaction of the contractors involved The efficiency of the operation is enhanced for the contractor because he has to do business with only one carrier

6

_ ~ I I

II I

A one million dollar spot system facility for repairing freight cars was placed in operation at the Bensenville Ill yards early in November Its completion marked another advance in the adoption of ultramodern techniques for speeding freight moveshyments for shippers and at lower cost to the railroad

The facility is one of the largest of its type in the country and the first to be inshystalled on a railroad serving the Northwest region The so-called one-spot repair system new in concept and practice is based on the principle of moving cars to men and material rather than men taking material to cars

The system is a compact layout featuring a 120 by 120 foot shop building with four servicing tracks Each of the tracks is equipped with two electric power winches that pull the cars to and from the shop building by means of between-the-rail cables attached to axle engaging devices known as rabbits The operation is controlled from a push button panel located at trackside in the building

Tools parts and equipment are assembled in one sheltered location to which cars are brought in a continuous flow All repairs are performed in the building with work going forward on the cars one at a time on the individual tracks The facility can be operated in all kinds of weather 24 hours a day

In 1960 the Milwaukee purchased new freight cars to meet the growing demand for longer and larger capacity rolling stock at a total cost of $9994400 A total of 775 new cars of various types was added to the fleet including 500 new wide door box cars 100 new covered hopper cars 100 general purpose flatcars of 60 foot length 50 damage free freight cars and 25 gondola cars

The 500 new box cars featuring doors which can be opened to a width of 15 feet 2 inches brought the Milwaukees total ownership of this highly versatile type to 1500

All the new freight cars purchased in 1960 had a capacity of 70 tons each and were equipped with roller bearings

An upgrading program carried out in Milwaukee included the rebuilding of 50-ton refrigerator cars 70-ton mill type gondola cars and 70-ton hopper type cars along with various other types of changes and additions to provide a wider and better service to shippers The major project in the Tacoma shops was the upgrading and repair of double door cars of 40 and 50 foot lengths

Delivery will start this spring on 40 new double-deck passenger cars ordered for suburban service from The Budd Company Philadelphia Pa at a cost of approxishymately six million dollars

The order for the new cars placed shortly after the approval of a fare increase last spring by the Illinois Commerce Commission was the first big step in the commuter service modernization program which looks toward the eventual replacement as earnshyings permit of all the present suburban cars with new double deck coaches

7

~- I II I j I III 1II~JII I ~ ~ I III~ I II I1III

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

The Milwaukee Road is the railroad of the Creative Crews The sum total of the efforts of these crews-out on the line in the shops and in the offices-is a smooth working closely knit effishycient transportation unit

The services and operation of Carscope established late in 1959 were expanded substantially during 1960 The original function was centered on the tracing of the movement of all carloads over the system to provide up-to-the-minute information on the location and movement of all carload freight for shippers and receivers anyshywhere in the United States Since the center started operations other uses of the data provided have been developed through additional sorting and assembly of punched card data

The program of conversion to an electronic data processing system moved ahead in 1960 toward an operational goal in the second half of 1961 Major accounting processes are being redesigned to integrate related functions simplify procedures speed the flow of data and in general achieve maximum benefit from central processing on new electronic equipment Testing of programming for the IBM 7070 computer was started late in the year

The last of nine regional data offices was recently established completing a program started in mid-1960 to provide a means of moving basic information more rapidly from dispersed source points to the central computer Each office will gather freight revenue payroll and material data in its area and transmit over telephone lines to Chicago In addition freight billing and collection operations are being transferred to the regional offices from the hundreds of local agencies with attendant advantages from concentration and specialization of functions

The computer center at Chicago will also use freight movement information fed in hourly by teletype from 36 key yard offices equipped with punched-card and transmission equipment In addition to accounting outputs and control statistics the computer will develop from such input all reports needed by Carscope as well as reports designed to aid in the distribution of empty freight cars

New types of sales kits unique in the railroad industry provide traffic solicitors with visual aids in the form of pictures maps diagrams and colored leaflets graphishycally presenting the services of the railroad

New traffic department offices opened in 1960 were sales and service units estabshylished in Birmingham Ala and Memphis Tenn

5

Trailer-on-flat car services to shippers were broadened substantially in 1960 by the use of Flexi-Van conventional piggybacking and containerization The Flexi-Van fleet has been expanded four times since the inception of that service a little over two years ago In order to widen its piggyback service the railroad joined in 1960 the national equipment pools of Trailer Train Company and North American Car Corporashytion which provide flat cars for piggyback movements

The transcontinental piggybacking of automobiles which the railroad started early in 1960 expanded greatly during the course of the year

Deliveries of new Flexi-Van equipment to the Milwaukee Road and its subsidiary - The Milwaukee Motor Transportation Company-were substantial during 1960 Early in the year the railroad added 25 new Flexi-Van 85-foot flat cars and the Milwaushykee Motor added 75 new vans and 60 new bogies (wheel assemblies) The 85-foot flat cars were the first Flexi-Van cars of that length to be put into service in the industry

In mid-year Milwaukee Motor received delivery of 25 new mechanically refrigershyated Flexi-Van units equipped with dual temperature controls so they also can be heated for wintertime shipping of perishable commodities In addition 12 Milwaukee Motor insulated vans that already were in FIexi-Van service were converted into refrigshyerated trailers with the addition of mechanical refrigeration units

The deliveries of Flexi-Van units brought the Flexi-Van fleet to a total of 64 special flat cars and Milwaukee Motors fleet to a total of 221 vans and 142 bogies

Additions were made to the fleet of conventional piggybacking cars in 1960 by the conversion in the Milwaukee shops of a total of 121 flat cars to that type of operation Important in the speeding of transcontinental piggybacking of new automobiles by the Milwaukee from Chicago to the Pacific northwest was the lowering of the track through the eighty-five year old tunnel at Tunnel City Wis by 26 inches providing clearance for the automobile shipments

The larger clearance created by the project permitted the railroad to step up its schedules for the auto piggybacking and for other high dimension loads on the Chicago-Milwaukee-Twin Cities route The project which was completed in record time involved the re-Iaying of 3200 feet of track

In 1960 a coordinated rail-truck operation was developed in Washington The operation involves the transporting of bulk cement and of steel special equipment and machinery

This service is provided by a subsidiary-The Milwaukee Motor Transportation Company-which uses tractors and semi-trailers for the major part of the hauling Cranes transfer heavy equipment from rail cars to the motor carrier units

During 1960 Milwaukee Motor hauled a substantial number of carloads of cement steel special equipment and machinery from railheads to construction sites

This is an excellent example of how a railroad has tailored its services to meet the needs of shippers and consignees and retain business that otherwise would have been diverted to competitors In this instance the Milwaukee provides the link between the railhead and off-track construction sites thus handling the entire movement to the satisfaction of the contractors involved The efficiency of the operation is enhanced for the contractor because he has to do business with only one carrier

6

_ ~ I I

II I

A one million dollar spot system facility for repairing freight cars was placed in operation at the Bensenville Ill yards early in November Its completion marked another advance in the adoption of ultramodern techniques for speeding freight moveshyments for shippers and at lower cost to the railroad

The facility is one of the largest of its type in the country and the first to be inshystalled on a railroad serving the Northwest region The so-called one-spot repair system new in concept and practice is based on the principle of moving cars to men and material rather than men taking material to cars

The system is a compact layout featuring a 120 by 120 foot shop building with four servicing tracks Each of the tracks is equipped with two electric power winches that pull the cars to and from the shop building by means of between-the-rail cables attached to axle engaging devices known as rabbits The operation is controlled from a push button panel located at trackside in the building

Tools parts and equipment are assembled in one sheltered location to which cars are brought in a continuous flow All repairs are performed in the building with work going forward on the cars one at a time on the individual tracks The facility can be operated in all kinds of weather 24 hours a day

In 1960 the Milwaukee purchased new freight cars to meet the growing demand for longer and larger capacity rolling stock at a total cost of $9994400 A total of 775 new cars of various types was added to the fleet including 500 new wide door box cars 100 new covered hopper cars 100 general purpose flatcars of 60 foot length 50 damage free freight cars and 25 gondola cars

The 500 new box cars featuring doors which can be opened to a width of 15 feet 2 inches brought the Milwaukees total ownership of this highly versatile type to 1500

All the new freight cars purchased in 1960 had a capacity of 70 tons each and were equipped with roller bearings

An upgrading program carried out in Milwaukee included the rebuilding of 50-ton refrigerator cars 70-ton mill type gondola cars and 70-ton hopper type cars along with various other types of changes and additions to provide a wider and better service to shippers The major project in the Tacoma shops was the upgrading and repair of double door cars of 40 and 50 foot lengths

Delivery will start this spring on 40 new double-deck passenger cars ordered for suburban service from The Budd Company Philadelphia Pa at a cost of approxishymately six million dollars

The order for the new cars placed shortly after the approval of a fare increase last spring by the Illinois Commerce Commission was the first big step in the commuter service modernization program which looks toward the eventual replacement as earnshyings permit of all the present suburban cars with new double deck coaches

7

~- I II I j I III 1II~JII I ~ ~ I III~ I II I1III

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

Trailer-on-flat car services to shippers were broadened substantially in 1960 by the use of Flexi-Van conventional piggybacking and containerization The Flexi-Van fleet has been expanded four times since the inception of that service a little over two years ago In order to widen its piggyback service the railroad joined in 1960 the national equipment pools of Trailer Train Company and North American Car Corporashytion which provide flat cars for piggyback movements

The transcontinental piggybacking of automobiles which the railroad started early in 1960 expanded greatly during the course of the year

Deliveries of new Flexi-Van equipment to the Milwaukee Road and its subsidiary - The Milwaukee Motor Transportation Company-were substantial during 1960 Early in the year the railroad added 25 new Flexi-Van 85-foot flat cars and the Milwaushykee Motor added 75 new vans and 60 new bogies (wheel assemblies) The 85-foot flat cars were the first Flexi-Van cars of that length to be put into service in the industry

In mid-year Milwaukee Motor received delivery of 25 new mechanically refrigershyated Flexi-Van units equipped with dual temperature controls so they also can be heated for wintertime shipping of perishable commodities In addition 12 Milwaukee Motor insulated vans that already were in FIexi-Van service were converted into refrigshyerated trailers with the addition of mechanical refrigeration units

The deliveries of Flexi-Van units brought the Flexi-Van fleet to a total of 64 special flat cars and Milwaukee Motors fleet to a total of 221 vans and 142 bogies

Additions were made to the fleet of conventional piggybacking cars in 1960 by the conversion in the Milwaukee shops of a total of 121 flat cars to that type of operation Important in the speeding of transcontinental piggybacking of new automobiles by the Milwaukee from Chicago to the Pacific northwest was the lowering of the track through the eighty-five year old tunnel at Tunnel City Wis by 26 inches providing clearance for the automobile shipments

The larger clearance created by the project permitted the railroad to step up its schedules for the auto piggybacking and for other high dimension loads on the Chicago-Milwaukee-Twin Cities route The project which was completed in record time involved the re-Iaying of 3200 feet of track

In 1960 a coordinated rail-truck operation was developed in Washington The operation involves the transporting of bulk cement and of steel special equipment and machinery

This service is provided by a subsidiary-The Milwaukee Motor Transportation Company-which uses tractors and semi-trailers for the major part of the hauling Cranes transfer heavy equipment from rail cars to the motor carrier units

During 1960 Milwaukee Motor hauled a substantial number of carloads of cement steel special equipment and machinery from railheads to construction sites

This is an excellent example of how a railroad has tailored its services to meet the needs of shippers and consignees and retain business that otherwise would have been diverted to competitors In this instance the Milwaukee provides the link between the railhead and off-track construction sites thus handling the entire movement to the satisfaction of the contractors involved The efficiency of the operation is enhanced for the contractor because he has to do business with only one carrier

6

_ ~ I I

II I

A one million dollar spot system facility for repairing freight cars was placed in operation at the Bensenville Ill yards early in November Its completion marked another advance in the adoption of ultramodern techniques for speeding freight moveshyments for shippers and at lower cost to the railroad

The facility is one of the largest of its type in the country and the first to be inshystalled on a railroad serving the Northwest region The so-called one-spot repair system new in concept and practice is based on the principle of moving cars to men and material rather than men taking material to cars

The system is a compact layout featuring a 120 by 120 foot shop building with four servicing tracks Each of the tracks is equipped with two electric power winches that pull the cars to and from the shop building by means of between-the-rail cables attached to axle engaging devices known as rabbits The operation is controlled from a push button panel located at trackside in the building

Tools parts and equipment are assembled in one sheltered location to which cars are brought in a continuous flow All repairs are performed in the building with work going forward on the cars one at a time on the individual tracks The facility can be operated in all kinds of weather 24 hours a day

In 1960 the Milwaukee purchased new freight cars to meet the growing demand for longer and larger capacity rolling stock at a total cost of $9994400 A total of 775 new cars of various types was added to the fleet including 500 new wide door box cars 100 new covered hopper cars 100 general purpose flatcars of 60 foot length 50 damage free freight cars and 25 gondola cars

The 500 new box cars featuring doors which can be opened to a width of 15 feet 2 inches brought the Milwaukees total ownership of this highly versatile type to 1500

All the new freight cars purchased in 1960 had a capacity of 70 tons each and were equipped with roller bearings

An upgrading program carried out in Milwaukee included the rebuilding of 50-ton refrigerator cars 70-ton mill type gondola cars and 70-ton hopper type cars along with various other types of changes and additions to provide a wider and better service to shippers The major project in the Tacoma shops was the upgrading and repair of double door cars of 40 and 50 foot lengths

Delivery will start this spring on 40 new double-deck passenger cars ordered for suburban service from The Budd Company Philadelphia Pa at a cost of approxishymately six million dollars

The order for the new cars placed shortly after the approval of a fare increase last spring by the Illinois Commerce Commission was the first big step in the commuter service modernization program which looks toward the eventual replacement as earnshyings permit of all the present suburban cars with new double deck coaches

7

~- I II I j I III 1II~JII I ~ ~ I III~ I II I1III

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

II I

A one million dollar spot system facility for repairing freight cars was placed in operation at the Bensenville Ill yards early in November Its completion marked another advance in the adoption of ultramodern techniques for speeding freight moveshyments for shippers and at lower cost to the railroad

The facility is one of the largest of its type in the country and the first to be inshystalled on a railroad serving the Northwest region The so-called one-spot repair system new in concept and practice is based on the principle of moving cars to men and material rather than men taking material to cars

The system is a compact layout featuring a 120 by 120 foot shop building with four servicing tracks Each of the tracks is equipped with two electric power winches that pull the cars to and from the shop building by means of between-the-rail cables attached to axle engaging devices known as rabbits The operation is controlled from a push button panel located at trackside in the building

Tools parts and equipment are assembled in one sheltered location to which cars are brought in a continuous flow All repairs are performed in the building with work going forward on the cars one at a time on the individual tracks The facility can be operated in all kinds of weather 24 hours a day

In 1960 the Milwaukee purchased new freight cars to meet the growing demand for longer and larger capacity rolling stock at a total cost of $9994400 A total of 775 new cars of various types was added to the fleet including 500 new wide door box cars 100 new covered hopper cars 100 general purpose flatcars of 60 foot length 50 damage free freight cars and 25 gondola cars

The 500 new box cars featuring doors which can be opened to a width of 15 feet 2 inches brought the Milwaukees total ownership of this highly versatile type to 1500

All the new freight cars purchased in 1960 had a capacity of 70 tons each and were equipped with roller bearings

An upgrading program carried out in Milwaukee included the rebuilding of 50-ton refrigerator cars 70-ton mill type gondola cars and 70-ton hopper type cars along with various other types of changes and additions to provide a wider and better service to shippers The major project in the Tacoma shops was the upgrading and repair of double door cars of 40 and 50 foot lengths

Delivery will start this spring on 40 new double-deck passenger cars ordered for suburban service from The Budd Company Philadelphia Pa at a cost of approxishymately six million dollars

The order for the new cars placed shortly after the approval of a fare increase last spring by the Illinois Commerce Commission was the first big step in the commuter service modernization program which looks toward the eventual replacement as earnshyings permit of all the present suburban cars with new double deck coaches

7

~- I II I j I III 1II~JII I ~ ~ I III~ I II I1III

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

11

Negotiations last year with the railroad brotherhoods both on a national and systemshywide basis resulted in a number of wage agreements In June mediation agreements were reached which granted a 2 per cent wage increase effective July 1 1960 and an additional 2 per cent increase on the same base effective March 1 1961 to the conshyductors engineers trainmen and firemen The cost-of-living provisions were eliminated

A mediation agreement was reached in August with 11 nonoperating employe groups granting 5 cents an hour increases in wages effective July 1 1960 Also welfare benefits were liberalized and life insurance provided effective March 1 1961 The cost-of-living provisions were also eliminated in this agreement

In September agreement was reached with the train dispatchers granting a wage increase of 2 per cent effective July 1 1960 and welfare and life insurance benefits effective March 1 1961 The cost-of-living provisions were eliminated Also in Sepshytember agreement was reached granting supervisors below the rank of general foreman in the mechanical department whose duties are exclusively supervisory a wage increase of $1217 per month effective July 1 1960 and a similar increase effective March 1 1961 with cost-of-living provisions eliminated

An agreement reached in November granted sleeping car porters a 5 centsan hour wage increase effective July 1 1960 and modification of health and welfare benefits including life insurance in accordance with the nonoperating agreement in August The cost-of-living provisions were eliminated

In December an agreement was reached granting parlor car conductors a wage increase of 2 per cent effective July 1 1960 a 2 per cent increase on the same base effective March 1 1961 and cost-of-living provisions eliminated

The 3 cents an hour wage increase made November 1 1959 in accordance with agreements providing for semi-annual adjustments for changes in the Bureau of Labor Statistics Consumers Price Index extended through the first 10 months of 1960 after which it was incorporated into the basic wage rates An additional 1 cent an hour cost-of-living increase was made in May 1960 which also became part of the basic wage rates in November 1960

Costs in the aggregate were increased approximately $3289000 in 1960 as the result of the wage and cost-of-living boosts and the effect of 1959 increases in the tax rates for unemployment compensation and for railroad retirement purposes

A 13 per cent increase in mail rates granted to the western lines in November 1960 will result in approximately one million dollars additional mail revenue annually for the Milwaukee The new rates became effective December 1 1960 and were retroshyactive to September 1 1960

8

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

The Interstate Commerce Commission is expected to make a final ruling in 1961 on exceptions filed to an adverse recomm~ndation by an examiner for the Commission on the first agreed charge rates ever published in the United States The Milwaukee and three other midwestern railroads are parties to the rates which apply on steel pipe shipments from Sault Ste Marie Ont to Chicago The examiners report held that such rates are unlawful under existing statutes

An examiner for the Interstate Commerce Commission in December 1960 recomshymended increases for Official territory and Midwestern lines on joint line traffic between (1) Official and Mountain-Pacific territories and (2) Midwestern and Mounshytain-Pacific territories If the examiners recommendations become effective it is estishymated that the Milwaukee Roads revenues from such traffic would increase more than $1600000 a year

The United States Supreme Court last year granted review of a decision adverse to the Milwaukee Road in the Spokane Gateway case and its ruling is expected in 1961

In order to be competitive with the Great Northern and Northern Pacific railroads for the long haul on traffic to and from points in Washington and Oregon served by the Spokane Portland and Seattle Railway system the Milwaukee Road instituted a proceeding before the Interstate Commerce Commission seeking joint rates to apply when such traffic moves over the Milwaukees line between Spokane and the Twin Cities the same as rates which apply when the traffic moves via the Great Northern or Northern Pacific

The Interstate Commerce Commission in 1957 denied such relief and in 1960 this decision was affirmed by the United States District Court in Milwaukee Wis

The second session of the 86th Congress in 1960 extended the 10 per cent travel tax to June 30 1961 Full removal of this burdensome tax is needed

The railroads pressed in Congress for passage of bills to permit them to diversify their services allow them to create a construction reserve fund and grant them accelshyerated depreciation None of these efforts was successful in the 86th Congress but renewed efforts for their adoption will be made in the 87th Congress

Several make-work proposals faced the railroads in the 86th Congress including one described as the track motor car bill and a measure making it more difficult to discontinue passenger trains the latter to be accomplished by amendment to the helpful Transportation Act of 1958 None of these efforts was successful

The voters of North Dakota in the general election held November 8 1960 apshyproved by a 3 to 2 margin repeal of a law on the North Dakota books since 1919 which required employment of an additional brakeman on freight trains of more than 40 cars The requirement claimed to have been made for safety reasons became obsoshylete many years ago through the modernizing of railway plant and equipment Imshyportant is the fact that the electorate in approving the Act expressed its opposition to provisions compelling employment of men where not needed

9

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

Two large industrial real estate transactions were among those made in 1960 by the Milwaukee Road One was the sale of a 28 acre tract on Chicagos west side to Zenith Radio Corporation It was one of the largest vacant pieces of industrial land within the City of Chicago The other was the sale of approximately 15 acres of propshyerty in the Menominee River valley in Milwaukee Wisconsin to Great Lakes Coal and Dock Company

A total of 119 new industries located along the lines of the Milwaukee last year and 59 existing industries along the railroad expanded

The purchase of 391 acres of strategically located land during 1960 brings to 2100 acres the total acquired by the Milwaukee in the last several years to assure available sites for future industries served by the railroad

In 1960 with the approval of the Interstate Commerce Commission passenger trains between Madison Wis and Canton S D Milwaukee Wis and Channing Mich and LaCrosse Wis and Austin Minn were discontinued resulting in an annual saving of 523128 train miles

The City of Los Angeles and the City of San Francisco operated by the Milwaukee in conjunction with the Union Pacific railroad between Chicago and Omaha were consolidated with a saving of 78080 train miles in the period from late September to mid-December 1960 making an over-all total of 601208 train miles eliminated in that year

A series of Interstate Commerce Commission hearings was held in February 1961 on the application for authority to discontinue the Olympian-Hiawatha trains between Minneapolis Minn and Tacoma Wash representing 1318380 annual train miles Final action will await the decision of the Commission

The passenger service deficit determined in accordance with the rules of the Intershystate Commerce Commission was $2652726 less in 1960 than in 1959

Abandonments of line in 1960 and early 1961 included 257 miles between Seymour and Westport Ind 726 miles between Limestone Junction and Glacier Wash and 224 miles between Bridge Switch and Ramsey Minn

A decision from the Interstate Commerce Commission is expected soon on the application for authority to abandon 157 miles of line between Prairie du Chien Wis and Marquette Ia including two pontoon bridges over the Mississippi River The examiner for the Commission made a favorable report to which exceptions were filed by the City of Prairie du Chien Wisconsin

During 1960 the Milwaukee with the approval of State regulatory agencies closed 26 stations dualized 3 agencies and discontinued 8 custodian stations Although 26 other dualizations were approved by the Minnesota Railroad and Warehouse Comshymission they are being held up because no decision has yet been given on a court appeal by the Order of Railway Telegraphers in opposition to the move In addition discontinuances of 15 agency positions are pending before various State regulatory bodies

10

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

In 1960 mortgage bonds and debentures in the principal amount of $2492600 were acquired and cancelled or are held in the Treasury

The following table shows that in the period from the consummation of the Plan of Reorganization on December 1 1945 to December 31 1960 $49797400 of mortshygage bonds were acquired and cancelled or are held in the Treasury This amount is more than 26 of the original issue In addition $1800000 of Five Per Cent Income Debentures have been acquired and cancelled or are held in the Treasury The resulting reduction in annual interest requirements is $2294246

SurrenmiddotCancelled Decreasedered ro Held Iorer-Through inITEM Trusree In Toral estSinking Annualfor Canmiddot Treasury RareFund Interestcellation

Chicago Milwaukee St Paul amp Pacific RR Co

First Mortgage 4 Bonds Series A $ 3450700 $2280100 $ 346300 $ 6077100 4 $ 243084 General Mortgage 4Y2 Income

Bonds Series A 22741400 610000 408500 23759900 4Y2 1069196 General Mortgage 4Y2 Converrible

Income Bonds Series B 16726300 733100 17459400 4Y2 785673 Five Per Cent Income Debentures

Series A 1500000 300000 1800000 5 90000 The Bedford Belt Ry Co

First Mortgage Bonds 17000 44000 61000 44 2593 The Sourhern Indiana Ry Co

First Mortgage Bonds 51000 256000 307000 44 13047 The Chicago Terre Haure amp Southeastmiddot ern Ry Co

First and Refunding Morrgage Bonds 536000 536000 44 22780 Income Mortgage Bonds 1597000 l597000 44 67873

Torals $44418400 $2958100 $4220900 $51597400 $2294246

As of April 1 1960 the record date for the 1960 Annual Meeting there were 5123 holders of Series A Preferred Stock and 10099 holders of Common Stock who resided in every State of the Union and in US territories and possessions The distribution by major classifications is as follows

Series A Preferred N umber of

Holders Shares Number of Held Holders

Common Shares Held

135292 4097 87956 3201 42307 2017

253097 784

Men 1935 Women 1908 Joint accounts 743 Fiduciaries institutions and foundations stock brokers nominees and others 537

568388 272599 164994

1117233

Total 5123 518652 10099 2123214

11

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

Long-term debt and equipment obligations due within one year outstanding in

the hands of the public as of December 31 1960 amounted to $273690700 compared

with $277397977 as of December 31 1959 a net decrease of $3707277

Increase

Equipment obligations covering purchase of equipment

Decreases

Mortgage Bonds and Debentures

Purchased and cancelled during the yeat through opetation of sinking funds-

First Mortgage 4 Bonds Series A

Less Bonds held in Treasury at December 31 1959 delivered to Mortgage

Trustee for sinking fund and cancelled during the year

General Mortgage 41 Income Bonds Series A

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

General Mortgage 41 Convertible Income Bonds Series B

Less Bonds held in Treasury at December 31 1959 sold to Mortgage Trustee

for sinking fund and cancelled during the year

Five Per Cent Income Debentures Series A

Less Debentures held in Treasury at December 31 1959 deposited with

Trustee for sinking fund and cancelled during the year

Purchased in the open market during the year and held in Treasury-

First Mortgage 4 Bonds Series A

General Mortgage 41 Income Bonds Series A

General Mortgage 41 Convertible Income Bonds Series B

Five Per Ceoc Income Debentures Series A

The Bedford Belt Ry Co First Mortgage Bonds

The Southern Indiana Ry Co First Mortgage Bonds

CTH amp SE Ry Co First and Refunding Mortgage Bonds

CTH amp SE Ry Co Income Mortgage Bonds

Equipment Obligations

Payments of Equipment Trust Certificates

Less Certificates Series]] held in Treasury at December 311959 and cancelled

by Trustee

$ 7650000

$ 349800

275000 74800

$1520100

895400 624700

$1296100

1296100

$ 300000

300000

346300

408500

577300

300000

21000

28000

77000

35000

6823000

125000 6698000

Payments of Conditional Sale Agreements covering purchase of equipment 2166677

Total Decreases $11357277

Net Decrease $ 3707277

12

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

The following is a summary of the capital expenditures made during 1960 Road property $ 6020662 Improvements on leased property 270 New equipment $10285197 Improvements to existing equipment 3681702 13966899

Total transportation properties 19987831 Miscellaneous physical property 102359

Total properties $20090190

Equipment delivered during the year 500-70-ton steel box cars with plug doors 100-70-ron flat cars 85 -70-ton steel covered hopper cars 50-70-ron DF steel box cars with roller bearings 25-70-ton gondola cars 15-70-ron steel covered hopper cars with pneumatic outlets

200-50-ron refrigerator cars (rebuilt) 68-70-ton gondola cars (rebuilt) 50-70-ron ballast and 1-70-ron hopper cars (rebuilt)

The source of funds for these expenditures was Equipment obligations issued for equipment delivered during the year $ 7597065 Depreciation amortization and retirement charges 5605313 Salvage from road and equipment retired 3380316 Donations and grants 246395 Moneys from property sales deposited with Mortgage Trustee

withdrawn or to be withdrawn 2990119 Other sources 25252 Unexpended funds carried over from year 1959 245730

TotaL $20090190 The amount of capital expenditures was 20090190

Remainder of funds $ 0

An estimated expenditure of $6515600 chargeable to capital account is planned for improvements to road property in the 1961 budget The improvements scheduled include provision for improving clearances in tunnels on the western lines depressshying certain tracks in South Minneapolis Minn laying of new and secondhand rail replacing renewing and strengthening of bridges and the purchase and installation of communication facilities for Electronic Data Processing

Estimated expenditures for new equipment and improvements to existing equipshyment provided for in the budget chargeable to capital account total $18599400 The new equipment to be delivered includes

750- 50-ton steel box cars with roller bearings 40-gallery type coaches 6-2400 HP Diesel-electric passenger locomotive units

The equipment improvement work scheduled for 1961 is a continuation of the Milwaukee Roads program of rebuilding upgrading and repairing rolling stock to provide patrons with suitable equipment and good service This program includes the installation in certain types of freight cars of loading devices designed to preven~

damage to ommodities

13

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

PEAT MARWICK MITCHELL amp CO CERTIFIED PUBLIC ACCOUNTANTS

111 vEST MONROE STREET

CHICAGO 3 ILLINOIS

ACCOUNTANTS REPORT

The Board of Directors Chicago Vulwaukee St Paul and

Pacific Railroad Company

11e have examined the balance sheet of Chicago Hihraukee St Paul and Pacific Railroad Company as of December 31 1960 and the related statement of income and retained income for the year then ended Our examination was made in accordance with generally accepted auditing standards and accordingly included such tests of the accounting records and such other auditing procedures as we conshysidered necessary in the circumstances

In our opinionthe accompanying balance sheet and stateshyment of income and retained income present fairly the financial position of Chicago Hilwaukee St Paul and Pacific Railroad Company at December 31 1960 and the results of its operations for the year then ended in conformity with principles of accounting prescribed or authorized by the Interstate Commerce Co~~ission applied on a basis consistent with that of the preceding year

We also have examined the statement of available net income and application thereof and it is our opinion that such statement presents fairly the computations of 1f ava ilable net income 1f for the year ended December 31 1960 in conformity with the provisions of the indentures

Chicago Illinois February 24 1961

14

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

YEAR

OPERATING REVENUES Freight Passenger mail and express Other

OPERATING EXPENSES Transportation

ANNUAL REPORT FOR 1960

STATEMENT OF INCOME AND RETAINED INCOME ENDED DECEMBER

Maintenance of way and structures Maintenance of equipment Traffic General and other

NET REVENUE

TAXES AND RENTS Federal income taxes (Note 3) Payroll and other taxes Equipment and joint facility rents-net

31 1960 WITH COMPARATIVE FIGURES FOR 1959

1960 1959

$189560907 $201536333

27623958 27324943 13178037 13180549

TOTAL 230362902 242041825

93769244 97849648 33691970 37430224

39048693 41862784

6581454 6749065

14838442 14959860

TOTAL 187929803 198851581

FROM RAILWAY OPERATIONS 42433099 43190244

(502073)

20137000 19917073

12641791 10123970 1---------------shy

TOTAL

NET RAILWAY OPERATING INCOME

OTHER INCOME Gain on sales of properties-nee Dividends and interest Miscellaneous-net

Fixed interest on long-term debt including amortization of discount

Contingent interest on long-term debt

Retained income at beginning of year

DIVIDENDS Preferred-$500 per share Common-$150 per share

Discount less premiums on mortgage bonds and debentures reacquired Estimated refundable federal income taxes Miscellaneous credits (charges)

TOTAL

NET INCOME

32778791 29538970

9654308 13651274

1405780 645275 1309234 2465529

873023 936557

3588037 4047361

13242345 17698635

5677502 5471962

7564843 12226673 6241780 6351497

1323063 5875176

84767002 83363306

86090065 89238482

2593260 2593260 3184872 3184871

1-------1------shyTOTAL 5778132 5778131

80311933 83460351

617791 767620

645105

98517 (106074)

716308 1306651

RETAINED INCOME AT END OF YEAR $ 81028241 $ 84767002

( ) Denotes contra Items See accompanying notes to financial statements 15

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

ASSETS 10 1959

CURRENT ASSETS

Cash and temporary cash investments $ 19954357 $ 30195945

Accounts receivable 19417396 18093197

Material and supplies at cost 18430319 20337088

Other current assets 1428952 1927262

TOTAL CURRENT ASSETS 59231024 70553492

SPECIAL FUNDS 2199299 852639

INVESTMENTS at cost (Note 1)

Affiliated companies 18688869 17028887

Other companies 670601 728437 1--------1-------shy

TOTAL INVESTMENTS 19359470 17757324

PROPERTIES (Notes 2 amp 3)

Road and roadway structures etc 674537236 671347422

Equipment 341373463 335072250

Acquisition adjustment and donations and grants Cr 177733674 Cr 177532805 1--------1-------shy

TOTAL TRANSPORTATION PROPERTIES 838177025 828886867

Less allowances for depreciation and amortization 257547044 248599089

NET TRANSPORTATION PROPERTY 580629981 580287778

N on-operating property less depreciation 4892692 5049887

NET PROPERTIES 585522673 585337665

OTHER ASSETS AND DEFERRED CHARGES 6238239 4387539

TOTAL ASSETS $672550705 $678888659

See accompanying l9r~s ~Q linancial statements 16

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

ANNUAL REPORT FOR 1960

BALANCE SHEET

DECEMBER 31 1960 WITH COMPARATIVE FIGURES FOR 1959

LIABILITY AND SHAREHOLDERS

CURRENT LIABILITIES

Accounts payable

Accrued payroll

Accrued taxes (Note 3)

Other current liabilities

EQUIPMENT OBLIGATIONS DUE WITHIN ONE YEAR (Note 4)

LONG-TERM DEBT

Mortgage bonds

Five per cent income debentures

Equipment obligations

RESERVES FOR VACATION PAY ETC (Note 4)

OTHER LIABILITIES AND DEFERRED CREDITS

SHAREHOLDERS EQUITY

Capital stock

EQUITY 1960 1959

$ 27388427 $ 25922119

6658943 6920679

8923827 8751185

1153008 1329939

TOTAL CURRENT LIABILITIES 44124205 42923922

8843552 8544193

140269800 142462400

58200000 58500000

66377348 67891384 1--------1-------shy

TOTAL LONG-TERM DEBT

TOTAL LIABILITIES

Common stock-no par value (stated value $100 per share) Authorized 2637450 shares (including 514221 shares reserved for conversion of General

Mortgage Bonds Series B) issued and outstanding 2123214 shares

Preferred stock-par value $100 per share 5 participating Authorized 1150000 shares issued and outstanding 518652 shares

Capital surplus

Retained income Appropriated bull Unappropriated

TOTAL SHAREHOLDERS EQUITY

CONTINGENT LIABILITIES (Note 5) TOTAL LIABIl1T1ES AND SHAREHOLDERS EQUITY

17

264847148 268853784

6909745 7204096

2582297

327306947

2380145

329906140

212321400

51865200

264186600

28917

44020761 37007480

81028241

345243758

212321400

51865200

264186600

28917

44006983 40760019

84767002

348982519

$672550705 $678888659

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATEMENT OF AVAILABLE NET INCOME AND APPLICATION THEREOF

YEAR ENDED DECEMBER 31 1960 WITH COMPARATIVE FIGURES

--

Income available for fixed charges bull

FIXED CHARGES Rent for leased roads and equipment Interest on long-term debt

On First Mortgage 4 Bonds Series A On modified Terre Haute bonds On equipment obligations

Interest on unfunded debt Amortization of discount on long-term debt

TOTAL FIXED CHARGES

INCOME AFTER FIXED CHARGES

Add charges to operating expenses represeuting rhe service value of nondepreciable roadway propert y retired and nor replaced

AVAILABLE NET INCOME-as defined in the First Mortgage and General Mortgage indentures

ApPLICATION OF SUCH AVAILABLE NET INCOME Appropriated for sinking fund for retirement of First Mortgage 4 Bonds Series A Contingent interest on General Mortgage 412 Income Bonds Series A Contingent interest on modified Terre Haute bonds Contingent interest on General Mortgage 412 Convertible Inrome Bonds Series B Appropriated for sinking fund for retirement of General Mortgage 412 Income Bonds Series A

and Series B

REMAINING AVAILABLE NET INCOME

Deduct charges to operating expenses representing the service value of nondepreciable road way property retired and not replaced

AVAILABLE NET INCOME-as defined in the indenture relating to Five Per Cent Income Debentures Series A

ApPLICATION OF SUCH AVAILABLE NET INCOME Contingent interest on Five Per Cent Income Debentures Series A Appropriated for sinking fund for retircment of Five Per Cent Income Debcntures Series A

REMAINDER AVAILABLE FOR PAYMENT OF DIVIDENDS OR ANY OTHER PROPER CORPORATE PURPOSES

See accompanying notes to financial statements

18

FOR 1959

1960

$13242345

420

2145645 535706

2884166 233

111332

5677502

7564843

102024

7666867

286816 1513512

290487 1534382

543393

4168590

3498277

102024

3396253

2903400 182626

3086026

$ 310227

1959

$17698635

300

2159542 540833

2677184 565

93538

5471962

12226673

235185

12461858

272824 1572435

293457 1568105

543393

4250214

8211644

235185

7976459

2917500 203255

3120755

$ 4855704

ANNUAL REPORT FOR 1960

Notes to Financial Statements

December 31 1960

1 Investments in affiliated companies include $7023010 pledged as collateral to mortgage bonds The Companys equity in the retained income since acquisition of unconsolidated subsidiaries (as shown by their unaudited financial statements) amounted to $1731352 at December 31 1960 of which $376282 represents 1960 net income

Other income includes dividends of $400000 in 1960 and $1500000 in 1959 from Milwaukee Land Company

2 The road and equipment property is stated at original cost or estimated original cose as determined by the Interstate Commerce Commission plus additions and betterments at cost less retirements and depreciation Consistent with the practice generally followed by Class 1 Railroads the Company had not provided for deshypreciation on road property prior to 1942 however a provision for past depreciation was recorded at 30 of original cost as of January 1 1944

3 In determining the Federal income tax liability for 1960 the Company deducted approximately $6345000 from income for amortization of emergency facilities declining balance depreciation and various differences in depreciation bases and rates in excess of recorded depreciation As a result no provision is required for Federal income tax and the loss carry forward is increased by apptoximately $4753000 At December 311960 the total loss carry forward is $6997000 which may result in future tax reductions of $3638000

The accumulated tax reductions resulting from amortization of emergency facilities and declining balance depreciation amounted to approximately $23178000 at December 31 1960

The Federal income tax returns of the Company through the years 1951 have been examined by the Internal Revenue Service and the Companys tax liabilities have been settled through that year For the years 1952 1953 and 1954 the Internal Revenue Service has proposed additional assessments which are being contested by the Company and in final settlement are not expected to have a material effect upon the financial position or results of operations

4 Reserve for vacation pay of approximately $5500000 payable in 1961 and debt due within one year are not included in current liabilities

5 The Company was liable as guarantor jointly with other railroads of certain obligations of affiliated companies amounting to approximately $111845000 at December 31 1960

19

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

INVESTMENTS-DECEMBER 31 1960

EXTENT OF DESCRIPTION

NUMBER OF SHARES

CONTROL PER CENT

LEDGER AMOUNT

AFFILIATED COMPANIES WHOlly-OWNED SUBSIDIARIES

CAPITAL STOCKS Milwaukee Land Company A 5000 100 500000 The Milwaukee Motor Transportation Company A 500 100 50000

TOTAL CAPITAL STOCKS 550000 NOTE

Milwaukee Land Company A 100 2652000 ADVANCES

Milwaukee Land Company 100 905640 The Milwaukee Motor Transportation Company 100 1335353

TOTAL ADVANCES bullbull 1 ~2~24~0~9~9~3---TOTAL INVESTMENTS-WHOLLy-OWNED SUBSIDIARIES 5442993

JOINTLY-OWNED TERMINAL SWITCHING AND OTHER COMPANIES CAPITAL STOCKS

Chicago Terre Haute amp Southeastern Railway Company 4075505 5398 1 Chicago Union Station Company A 7000 25 7000 Davenport Rock Island amp North Western Railway Company A 15000 50 1750000 Des Moines Union Railway Company A 1000 50 100000 Des Moines Union Railway Company B 1000 50 26000 Indiana Harbor Belt Railroad Company A 15200 20 1520000 Kansas City Terminal Railway Company C 183333 8~ 183333 Minneapolis Eastern Railway Company A 625 50 15475 Packers Car Line Company 306 956 3060 Railway Express Agency Incorporated 26 26 2600 The Minnesota Transfer Railway Company A 913 11yg 91300 The Pullman Company 9426 128 348762 The St Paul Union Depot Company A 1036 12Y2 130475 Trailer Train Company 500 294 98860

TOTAL CAPITAL STOCKS 4276866 NOTE

Railway Express Agency Incorporated 26 751804 ADVANCES

Chicago Union Station Company 25 4786146 Davenport Rock Island amp North Western Railway Company 50 1292103 Des Moines Union Railway Company 50 855112 Kansas City Terminal Railway Company 8~ 647294 Packers Car Line Company 956 72464 The Minnesota Transfer Railway Company 11yg 353014 The St Paul Union Depot Company 12Y2 211073

TOTAL ADVANCES bull middot1 __--c~8~2~1~7L2~0~6c--_ TOTAL INVESTMENT-AFFILIATED COMPANIES 18688869

OTHER COMPANIES STOCKS

Miscellaneous 7676 DEBENTURES

Century 21 Exposition Inc 25000 NOTE

C H Lien Construction Company 1500 SALE AGREEMENTS

Best Built Company 35750 CargiIl Incorporated 390000 General Warehouse amp Transportation Company 24000 J K Fiddes 59200 J Lentin Lumber Company 39900 Monarch Warehouses Incorporated 27360 Steven] Kipper Jr 34039 Thisted Motor Company 11520 Other companies and individuals 14656

TOTAL SALE AGREEMENTS 636425 TOTAL INVESTMENT-OTHER COMPANIES

TOTAL INVESTMENTS

670601 $19359470

I--------=-=-=c--=-=--shy

A-Pledged under Chicago Milwaukee Sc Paul and Pacific Railroad Company First Mortgage except Directors qualifying shares B-Deposited with IowamiddotDes Moines National Bank Des Moines Iowa under Stock Trust Agreement dated June 14 1948 and pledged

under the First Mortgage C-Deposited with First National Bank of Kansas City Mo under Stock Trust Agreement dated June 12 1909 and pledged under the

First Mortgage except Directors qualifying shares

20

ANNUAL REPORT FOR 1960

INVESTMENT IN PROPERTIES

ACCOUNT BALANCE AT JANUARY 1

EXPENDITURES DURING THE YEAR

CREDITS FOR PROPERTY RETIRED DURING THE YEAR

BALANCE AT DECEMBER 31

J

ROAD Engineering Land for transportation purposes Other right-of-way expenditures Grading Tunnels and subways Bridges trestles and culverts Ties Rails Other track material Ballast Track laying and surfacing Fences snowsheds and signs Station and office buildings Roadway buildings Water stations Fuel stations Shops and enginehouses Storage warehouses Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous structures Roadway machines Roadway small tools Public improvements-Construction Other expenditures-Road Shop machinery Power-plant machinery

$ 19526006 39048637

381312 143144397

9833072 76929583 34650264 68850190 47424085 26425043 33120819

5401156 26590033

2113899 1091355

746608 19544030

64349 1607522 6300222

21437281 1612483 9737209

673072 8486729

321671 14661137

335 7212584 5500804

$ 80269 $ 47281 105987 319878 77192

258951 255767 114819 42593

1013757 304057 116894 47625 251013 51045 471429 50791

90866 25183 196827 57265

13843 2672 450470 826144

7026 37792 15021 69162

3325 173 537467 38753

29057 58332

564767 157799 360010 104017

612 13590 5060

79 5656 588388 61627

1042 270 232514 59940

422650 96923

3149 20334

$ 19558994 38834746

458504 143147581

9905298 77639283 34719533 69050158 47844723 26490726 33260381

5412327 26214359

2083133 1037214

749760 20042744

64349 1578247 6707190

21693274 1611871 9745739

667495 9013490

322443 14833711

335 7538311 5483619

TOTAL ROAD 632435887 6020402 2746751 635709538

EQUIPMENT Locomotives Freight-train cars Passenger-train cars Floating equipment Work equipment Miscellaneous equipment

124658042 169559340

31348424 278731

6893714 2333999

248407 598587 13410931 6445607

237485

91258 221157

216303 162850

124307862 176524664

31110939 278731

6763815 2387452

TOTAL EQUIPMENT 335072250 13966899 7665686 341373463

GENERAL EXPENDITURES 38292664 260 84367 38208557

r IMPROVEMENTS ON LEASED PROPERTY 618871 270 619141

TOTAL OPERATING PROPERTIES 1006419672 19987831 10496804 1015910699

MISCELLANEOUS PHYSICAL PROPERTY Non-operating property Track material loaned

7007150 206040

102359 6922

141991 7926

6967518 205036

TOTAL MISCELLANEOUS PHYSICAL PROPERTY 7213190 109281 149917 7172554

TOTAL PROPERTIES BEFORE RECORDED DEPRECIATION $1013632862 $ 20097112 I $ 10646721 $ 1023083253

21

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

CONTINGENT LIABILITIES WITH RESPECT TO SECURITIES OF OTHER COMPANIES AS OF DECEMBER 31 1960

ITEMS AMOUNT

CHICAGO UNION STATION COMPANY 1 First Mortgage Bonds 3Ya Series F due July 1 1963 $ 13718000 2 First Mortgage Bonds 2Ys Series G due July 1 1963 34030000 3 Note 5ri due September 1 1961 2500000

50248000 Principal and interesr guaranteed jointly and severally by the Railroad Com~any and 3 other proprietors at time of issue The

Railroad Company with other proprietors has agreed that gross rental to e paid bJ them for use of Chicago Union Station faciliries shall include a sum sufficient ro pay interest on all of these securiries an the payment into the Retirement Fund for First Mortgage bonds beginning in 1955 and to advance amounts requited to pay at maturity ptincipal of Item 3

INDIANA HARBOR BELT RAILROAD COMPANY 1 First Mortgage Bonds 5Ya due June I 1982 7235000 2 Equipment Trust Certificates 2 due annually Segtember 15 1961 to September 15 1964 772000 3 Equipment Trust Certificates 2ri due annually Fe ruary 15 1961 to February 15 1965 600000

8607000 Principal and interest on the 5Ya Bonds is guaranteed jointly and severally by the Railroad Company and 3 other proprietors

The Railroad Company and other proprietors severally guarantee in proportion to their stock holdings the payment by the Belt Railroad of the principal of and dividends on equipment obligations Items 2 and 3

KANSAS CITY TERMINAL RAILWAY COMPANY 1 First Mortgage Serial Bonds due annually October 1 1961 to October I 1974 38602000

Under a certain operating agreement the Railroad Company and 11 other proprietors are obligated to pay to the Terminal Company or in case of default to the Mortgage Trustee in equal shares the principal of these bonds as they mature in the nature of nonmiddot interest bearing advances and interest thereon as rental

PACKERS CAR LINE COMPANY Conditional Sale Agreements 298272

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-956

THE MINNESOTA TRANSFER RAILWAY COMPANY 1 3yeni Sinking Fund Promissory Notes dueJune 11976 1461600

Under provisions of the bymiddotlaws of the Transfer Co the Railroad Company and 8 other proprietors are required to conmiddot tribute on an ownership basis to (a) an annual sinking fund for these Notes equal to $41412 payable on or before May 20 of each year and (b) semimiddotannual installments of interest on the Notes

THE ST PAUL UNION DEPOT COMPANY 1 First and Refunding Mortgage Bonds 3Ya Series B due October I 1971 10891000

Guaranteed jointly and severally by the Railroad Company and 7 other proprietors each of which is also obligated to advance its ownership proportion of amounts required for Sinking Fund payments and to pay its proportion based upon use of the interest on the bonds

TRAILER TRAIN COMPANY Conditional Sale Agreements 1736741

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-294

TOTAL $111844613

22

ANNUAL REPORT FOR 1960

LONG-TERM DEBT DECEMBER 31 1960

DESCRIPTION DATE OF

ISSUE DATE OF

MATURITY

AMOUNT ORIGINALLY

ISSUED OR ASSUMED

AMOUNT AS OF

DBc 31 1960

AMOUNT HELD BY COMPANY

AMOUNT ACTUALLY

OUTSTANDING RATE PER

CENT

INTEREST

PAYABLB ACCRUED DURING

YBAR First mongage bonds Series A General mortgage income bonds

Series A General mortgage convertible inmiddot

come bonds Series B Five per cent income debentures

Series A The Bedford Belt Ry Co Grsr

mongage bonds The Southern Indiana Ry Co first

mongage bonds Chicago Terre Haute and 5ourbmiddot

eastern Ry Co Firsr and refunding mortgage

bonds Income mortgage bonds

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

I 1944

11944

11944

11955

11946

11946

I 1946 I 1946

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

11994

12019

12044

12055

11994

I 1994

11994 I 1994

$ 59515100

57256600

51422100

60000000

350000

7287000

9571000 6335800

$ 53784300

33905200

34640400

58500000

333000

7236000

9571000 6335800

$ 346300

408500

733100

300000

144000

256000

2051000 1597000

$ 53438000

33496700

33907300

58200000

189000

6980000

7520000 4738800

4

41

41

5

4~

44

4~ 4~

J amp J

April

April

MampS

JA amp J

JA amp J

JA amp J JA amp J

$ 2145645

1513512

1534381

2903400

7961

296938

320161 201133

Eb~ro~)nt obl~gati~~~ ~~ederails 163723218 75220900 75220900 2884166 Totallongmiddotterm debe $415460818 $279526600 $ 5835900 $273690700 $11807297

$100000 pledged undet ChIcago Terre Haute and Southeastern RaIlway Company Fust and refundmg mongage $1515000 pledged under Chicago Milwaukee St Paul and Pacific Railroad Company First mongage

EQUIPMENT OBLIGATIONS DECEMBER 31 1960

INTBRESTDATB OF DATB OF ORIGINAl AMOUNT AMOUNT PRINCIFAL

DESCRIPTION LBASE OR FINAL COST OF ORIGINALLY OUTSTANDING PAYABLB RATE ACCRUBD AGREEMENT MATURITY EQUIPMENT ISSUED DBc 31 1960 DURING 1961 PER PAYABLB DURING

CENT YEARI EQUIPMENT TRUST CERTIFICATES Series HH Apr 11949 Apr 11964 $ 8112742 $ 6060000 $ 1414000 $ 404000 2Ji AampO $ 37260 Series JJ Sept I 1949 Sept 1 1964 7604384 5640000 1504000 376000 2li MampS 34846 Series KK Oct I 1949 Oct 11964 ~026868 4500000 1200000 300000 2~ AampO 30375 Series LL June I 1950 June 1 1965 289514 4650000 1395000 310000 24 J amp D 36038 Series MM Nov 11950 Nov I 1965 7251863 5430000 1810000 362000 2n MampN 48554 Series NN June I 1951 June I 1961 7254678 5300000 265000 265000 2Ya JampD 17776 Series 00 OCt I 1951 Oct 11966 10053530 7500000 3000000 500000 2Ya AampO 93437 Seties PP bull Mar 11952 Mar 11967 3215855 2400000 1040000 160000 2Ya MampS 31817 Series QQ Sept I 1952 Sept 1 1967 5441323 3990000 1862000 266000 3Va MampS 61651 Series RR Jan I 1954 Jan 11969 10379112 7650000 4335000 510000 3Va J ampJ 139454 Series SS July 11954 July 11969 9931620 7800000 4680000 520000 24 J ampJ 132275 Series TT Nov 1 1954 Nov I 1969 9141903 7200000 4320000 480000 2Ya MampN 132250 Series UU Jan 11956 Jan 11971 9655380 7500000 5250000 500000 3raquo J amp J 181407 Series VV (1st Install) Feb I 1957 Feb 11972 3000000 2300000 200000 4 FampA 94667 11745718 Series VV (2nd InSltaII) Feb I 1957 Feb I 1972 6000000 4600000 400000 4Vs F ampA 207084 Series WW Jan 11958 Jan 11973 6814810 5400000 4500000 360000 4gtil J amp J 189338 Series XX Feb I 1959 Feb 11974 7419495 5850000 5265000 390000 41 FampA 242775Series YY (1st Install) Feb I 1960 Feb I 1975 3000000 2900000 200000 4Ya FampA 121878 Series YY (2nd Install) Feb 11960 Feb I 1975 9683950 4650000 4495000 310000 4~ FampA 128844 CONDITIONAL SALE AGREEMENTS

The FitS( National Bank of Chimiddot ca~o Assignee of the Sellers

Paci c Car amp Foundty Co May I 1956 Nov I 1964 1843205 1428400 731357 182916 395 FMAampN 32094First Wisconsin Narional Bank of

Milwaukee and Northwestmiddot ern National Bank of Minneshyapolis Assignees of tbe SeUers

General Motors Corpn (Electro-Motive Div) Feb 25 1953 May 11961 1543977 1155000 80558 80558 3 FMAampN 4594

Fairbanks Motse amp Co July 15 1953 Nov 1 1961 531102 396000 54830 54830 3 FMAampN 2380American Locomotive Co July 15 1953 Nov 1 1961 529935 396000 54830 54830 3 FMAampN 2380Baldwin-LimamiddotHamilton

Corporation July 15 1953 Nov 1 1961 357568 264000 36553 36553 3 FMAampN 1587Seattle-Fitst National Bank Asmiddot

Bai1i~e_~i~Sfa~il~~n Corporation SePt I 1953 Nov 1 1961 357568 264000 36979 36979 335 FMAampN 1791

General Motors Cotpn (Electro-Motive Div) Sept I 1953 Nov 1 1961 1670914 1236000 173128 173128 335 FMAampN 8385

American Locomotive Co Sept I 1953 Feb 11962 529935 396000 69048 55008 335 FMAampN 3135Continental Illinois National Bank

and Ttust Company of Chishycago Assignee of tbe SeUers

Pullman-Srandard Car Manumiddot facturing Co May 11958 Nov I 1973 4920125 4920125 4245616 328008 440 MampN 195836

General American Transpotta tion Corporation May I 1958 Nov I 1973 6165438 6165438 5296389 411029 440 MampN 244862

United States Railway Equipment Co May 11958 Nov 1 1973 570706 570706 494612 38047 440 MampN 22740

General Motors Cotpn Jan 15 1959 Mar I 1974 8680000 8680000 7812000 578666 5 MampS 402656 Total equipment obligations $163723218 $129391669 $75220900 $ 8843)52 $ 2884166

PAYMENTS MATURING IN YEARS ENDING December 31 1961 $ 8843552 December 31 1966 $ 6151751 December 311971 $ 3465751December 31 1962 8108041 December 31 1967 5571751 December 311972 291751December 311963 8101627 December 31 1968 )225751 Decembet 31 1973 bull 2370271Decembet 31 1964 bull 7862066 December 31 1969 4970751 Decembet 31 1974 994335December 311965 6668751 December 31 1970 3715751 December 311975 _ 255000

Total $75220900

23

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

MILES OF ROAD BY STATES DECEMBER 31 1960

ROAD OPERATED

STATE OWNED SOLELY OWNED JOINTLY TRACKAGELEASED TOTALMAIN BRANCH MAIN BRANCH RIGHTS

LiNE LINE LINE LINE

Idaho 11276 11083 9middot11 23270 Illinois 43296 11755 240 14 13231 68536 Indiana 15591 3679 19270 Iowa 119993 51468 08 04 10 6706 178189 Kansas 705 705

Michigan 5782 11978 25 583 18368 Minnesota 75531 35154 503 2270 19410 132868 Missouri 13002 944 1651 15597 Montana 74753 47322 2999 46 125120 Nebraska 562 562

North Dakota 10250 26329 110 36689 South Dakota 104314 69528 173842

31469 47426 2688 5000 20110 106693i~~~~J~n 103928 47228 1634 7051 159841

Total 609185 362950 4383 12056 10 70966 1059550

Includes 97 mile owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contraCt

MILES OF TRACK DECEMBER 31 1960

OWNED OWNED TRACKAGEITEMS LEASED TOTALSOLELY JOINTLY RIGHTS

Miles of Road (First Main Track) Operated 972135 16439 10 70966 1059550 Not operated 362 362

Additional Main Tracks Operated 69332 1424 41 31329 102126 Not operated

Yard Tracks and Sidings Operated 321153 25542 219 47997 394911 Not operated 228 2626 2854

I-----f------f-----middotI-----I----shyTotal operated 1362620 43405 270 150292 1556587

Total not operated 590 2626 3216 I-----f-----Imiddot-----I-----I----shy

Grand Total 1363210 46031 270 150292 1559803

Miles of Road operated includes 97 mile Yard Tracks and Sidings operated includes 124 miles owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contract

24

ill ~ It

I I I i I I I bull II III

ANNUAL REPORT FOR 1960

DETAILED STATEMENT OF RAILWAY OPERATING REVENUES AND EXPENSES

RAILWAY OPERATING REVENUES

1960 1959 INCREASE DECREASE TRANSPORTATION

Freight $189560907 $201536333 middot0 $ 11975426 Passenger 15174969 15282171 107202 Baggage 79806 86066 middot 6260 Parlor and chair car 83476 91957 8481 Mail 9418410 8862116 $ 556294 Express 3030579 3180656 150077 Other passenger-crain 107746 100303 7443 Milk 18260 30216 middot 11956 Switching 5979910 6591066 611156

1------1------1-------1------shyTOTAL TRANSPORTATION REVENUE 223454063 235760884 12306821

INCIDENTAL

Dining and buffet 1521218 1527536 6318 Station crain and boat privileges 57552 56068 1484 Storage-Freight 8015 11196 - 3181 Storage-Baggage 3631 3837 - 206 Demurrage 1240131 1248537 8406 Communication 55650 72541 16891 Rents of buildings and other property 257841 246697 11144 Miscellaneous 461149 507969 middot middot0 46820

TOTAL INCIDENTAL OPERATING REVENUE 3605187 3674381 69194

JOINT FACILITY

Joint facility-Credit 3315646 2620693 694953 Joint facility-Debit (11994) (14133) (2139)

TOTAL JOINT FACILITY OPERATING REVENUE 3303652 2606560 697092

TOTAL RAILWAY OPERATING REVENUE $230362902 $242041825 $ 11678923

( ) Denotes concra items

RAILWAY OPERATING EXPENSES

1960 1959 INCREASE DECREASE MAINTENANCE OF WAY AND STRUCTURES

Superincendence $ 3108012 $ 3388761 $ 280749 Roadway maincenance 2861659 2867371 5712 Tunnels and subways 10889 11354 465 Bridges trestles and culverts 986082 1198575 212493 Ties 1793766 1827106 33340 Rails 592902 894914 302012 Other track material 1336407 1996881 660474 Ballast 217365 408471 middot 191106 Track laying and surfacing Fences snowsheds and signs

6515560 319315

7505265 398716

989705 79401

Station and office buildings 828484 1014046 185562 Roadway buildings 55448 86514 31066 Water stations Fuel stations

12115 26908

21831 16802 $ 10106

9716

Shops and enginehouses 574222 542976 31246

25

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

RAILWAY a PERATING REVENUES AND EXPENSES- CONTINUED RAILWAY OPERATING EXPENSES-CONTINUED

MAINTENANCE OF WAY AND STRUCTURES

Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous StruCtures Road property-Depreciation _ Retiremenes- Road Roadway machines _ Dismantling retired road property Small cools and supplies Removing snow ice and sand Public improvemenes-Maintenance Injuries co persons Insurance Stationery and printing Other expenses Right-of-way expenses Maineaining joint cracks yards and other facilities-Debit Maintaining joint tracks yards and other facilities-Credit

TOTAL MAINTENANCE OF WAY AND STRUCTURES

MAINTENANCE OF EQUIPMENT

Superintendence Shop machinery Power-plant machinery Shop and powerplant machinery-Depreciation Dismantling retired shop and powermiddotplane machinery Other locomotives-Repairs Freight-train cars-Repairs Passenger-train cars-Repairs Work equipment-Repairs Miscellaneous equipment-Repairs Dismantling retired equipment Retirements-Equipment Equipmene- Depreciation Inj uries to persons Insurance Stationery and printing Other expenses Taint maintenance of equipment expenses-Debit Taint maineenance of equipmene expenses-Credit

TOTAL MAINTENANCE OF EQUIPMENT

TRAFFIC

Superintendence Outside agencies Advertising Traffic associations Industrial and immigration bureaus Insurance Stationery and printing Other expenses

1960 1959 INCREASE DECREASE

$ 56714 $ 36447 $ 20267 bullbullbullbullbullbullbull _0 bullbullbullbullbullbull

935578 909129 26449 bullbull 0 bullbullbullbullbullbullbull 0 bullbullbullbullbull

bullbullbullbullbullbull 0 bullbullbullbullbullbull bull bullbull 1838913 1653168 185745 31898 33384 $ 1486 301492 355954 54462 9685 11190 middot 1505 5028247 4953681 74566 197350 241483 44133 706168 892299 186131 107360 148842 middot 41482 780012 825073 45061 841898 1093119 251221 736255 713553 22702 0 326277 442052 115775 50816 46225 4591 71268 87971 16703 419344 470012 50668bull bullbull 0 bullbullbullbullbullbullbullbullbullbull

43266 45762 2496

2725332 2842160 middot 116828

(755037) (550863) (204174) 1------1------1-------1------shy

33691970 37430224 3738254

1716762 1720882 41200 bullbullbullbullbullbullbullbullbullbullbullbullbullbullbull

521695 506499 15196

133941 153222 19281

284088 285333 1245

3681 856 2825

12448450 13197294 748844

9119749 10867539 1747790

2844061 3581261 737200

249163 301007 middot 51844

196990 196551 439

110983 91095 19888

(139163) (764585) (625422)

10468468 10143824 324644

245956 297309 51353

66754 68018 1264

42632 59005 16373

477426 563338 85912

292109 629586 337477

( 35052) (35250) (198)

39048693 41862784 2814091

1853253 1775877 77376

3420570 3680896 260326

641695 669595 27900

316941 281954 34987

50793 58011 7218

991 875 116

267539 246898 20641

29672 34959 5287 1------1------1middot------1------shy

TOTAL TRAFFIC EXPENSES $ 6581454 $ 6749065 $ 167611

( ) Denotes contra items

26

ANNUAL REPORT FOR 1960

RAILWAY OPERATING REVENUES AND EXPENSES-CONCLUDED

RAILWAY OPERATING EXPENSES-CONCLUDED

1960 1959 INCREASE DECREASE TRANSPORTATION

Superintendence $ 2981453 S 2814960 $166493 Dispatching trains 737390 807806 $ 70416 Station employees 12568811 13277513 708702 Weighing inspection and demurrage bureaus 307278 325534 bullbullbullbullbullbull 0 bullbullbullbullbullbullbullbullbull 18256 Station supplies and expenses 1091896 1140062 bullbull 0 bullbullbull 0 bullbullbullbullbullbull 0 bullbull 48166 Yardmasters and yard clerks 3991133 4119498 bullbullbullbullbullbull 0 bullbullbullbullbullbull 0 bullbull 128365 Yard conductors and brakemen 9303622 9647318 343696 Yard swirch and signal tenders 730410 755025 24615 Yard enginemen 6155278 6362440 207162 Yard switching fuel 923737 988987 65250 Yard switching power purchased 11946 15258 bullbull 0 bullbullbullbullbullbullbullbullbullbullbullbullbull 3312 Water for yard locomotives 17360 19948 2588 Lubricants for yard locomotives 83523 109472 25949 Other supplies for yard locomotives Enginehouse expenses-Yard

49721 498339

48817 542983

904

44644

Yard supplies and expenses Operating joint yards and terminals-Debit Operatin~ joint yards and terminals-Credit Train engInemen Train fuel Train power purchased Water for train locomotives

466959 5790981 (683719)

9533667 7243332

864933 94310

441246 5978628 (685475)

9966568 7758783

907295 105164

25713 middot bull bullbull 0 bullbullbullbullbullbullbullbullbullbull 0

middot

187647

(1756) 432901 515451 42362 10854

Lubricants for train locomotives 795622 938600 142978 Other supplies for train locomotives Enginehouse expenses-Train Trainmen

210707 1124921

12091384

202708 1222756

12613963

7999 bullbullbullbull 0 bullbullbullbullbullbullbull bullbullbullbull

97835

522579 Train supplies and expenses 6340264 6660876 320612 Operating sleeping cars 715113 526531 188582 Signal and interlcker operation CrOSSIng protectIOn

1049887

721750 1037947

806370 11940

middot

84620 Drawbridge operation 215086 258082 42996 Communication system operation 1060497 1081772 21275 Operating Boating equipment 11796 10985 811 Srationery and printing 412827 392820 20007 Other expenses 817489 848149 30660 Operating joint tracks and facilities-Debit 1170056 1311393 141337 Operating joint tracks and faciliries-Credir Insurance

(786053)

78437 (751937)

92514 (34116)

14077 Clearing wrecks Damage to property

265853 120728

230128 206210

35725

85482

Damage to live stock on right-of-way Loss and damage-Freight

80817

2795442 53816

2942960 27001

147518 Loss and damage-Baggage 5528 722 4806 Injuries to persons 1708733 1714453 5720

TOTAL TRANSPORTATION EXPENSES 93769244 97849648 4080404

MISCELLANEOUS OPERATIONS Dining and buffet service 2855845 2888241 32396 Operaring joint miscellaneous facilities-Debit 149757 207418 57661

J------J------I-------I------shyTOTAL MISCELLANEOUS OPERATIONS 3005602 3095659 90057

GENBRAL Salaries and expenses of general officers 1421416 1331832 89584 Salaries and expenses of clerks and attendants 6821635 6920559 98924 General office supplies and expenses 753564 727092 26472 Law expenses 831662 811940 19722 Insurance 33708 6002 27706 Pensions and gratuities 818190 917286 99096 Stationery and priming 348137 336267 11870 Valuation expenses 53068 59453 6385 Other expenses 501292 520844 19552 General joint faciliries-Debit 258783 241859 16924 General joint faciliries-Credit (8615) (8933) (318)

TOTAL GENERAL EXPENSES 11832840 11864201 middot 31361

GRAND TOTAL RAILWAY OPERATING EXPENSES $187929803 $198851581 $10921778

( ) Denotes contra items

27

bullbullbull

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

ANALYSIS OF INCREASES AND DECREASES IN TOTAL RAILWAY OPERATING EXPENSES 1960 COMPARED WITH 1959

MAINTENANCE MAINTENANCE TRANSshyITEMS OF WAY AND OP ALL OTHER TOTALPORTATIONSTRUCTURES EQUIPMENT

LABOR General wage increases + $ 360933 + $ 323486 + $1370434 + $ 289045 + $ 2343898 Straight time worked - 2213317 - 2135307 - 4273302 - 680973 - 9302899 Overtime worked - 76922 - 10613 - 163702 9398 - 241839+ Time paid for not worked (incl vacations and holidays) - 100783 - 137170 - 123771 33475 - 323249+

TOTAL LABOR - 2030089 - 1959604 - 3190341 - 344055 - 7524089

FUEL Price middot middot middot - 375791 - 375791 Consumption middot middot middot - 204910 - 204910

TOTAL FUEL middot middot middot middot - 580701 middot - 580701

ELECTRIC POWER middot bullbullbullbullbullbull to middot middot - 45674 middot - 45674

MATERIAL-Ocher than fuel Price + 106251 112344 - 1059 17453 234989 Quanticy - 1181388 - 900335 201128 34210 - 1846385

+ + + + +

TOTAL MATERIAL OTHER THAN FUEL - 1075137 - 787991 200069 51663 - 1611396+ + MISCELLANEOUS

Health and welfare benefits - 38735 - 60626 - 57909 - 15652 - 172922 Other miscellaneous - 624726 - 954691 - 405848 19015 - 1966250+

TOTAL MISCELLANEOUS - 663461 - 1015317 - 463757 3363 - 2139172+ TOTAL LABOR MATERIAL AND MISCELLANEOUS - 3768687 - 3762912 - 4080404 - 289029 - 11901032

DEPRECIATION + 74566 323399 middot + 397965+ middotRETIREMENTS - 44133 625422 middot + 581289+

TOTAL DEPRECIATION AND RETIREMENTS + 30433 948821 middot middot + 979254+ TOTAL RAfLWAY OPERATING EXPENSES - $3738254 - $2814091 - $4080404 289029 - $10921778-I $

RAILWAY OPERATING REVENUES EXPENSES TAXES AND INCOME BY MONTHS FOR THE YEAR ENDED DECEMBER 31 1960

1960

RAILWAY OPERATING REVENUES

RAILWAY OPERATING

EXPENSES

NET REVENUE FROM

RAILWAY OPERATIONS

RAILWAY TAX

ACCRUALS

RAILWAY OPERATING

INCOME

EQUIPMENT RENTS-NET

DR

JOINT FACILITY

RENTS-NET DR

NET RAILWAY OPERATING

INCOME

January $ 17336067 $ 15803272 $ 1532795 $ 1670000 $ (137205) $ 422175 S 231113 $ (790493) February 18493440 15151942 3341498 1673000 1668498 490735 234172 943591 March 19025746 15902966 3122780 1695000 1427780 686903 219282 521595 April bull 18042813 15280563 2762250 1684000 1078250 586443 251268 240539

May 18975935 16148830 2827105 1728000 1099105 824503 181449 93153 June 19011723 16297457 2714266 1727000 987266 803292 217671 (33697) July 18796482 15947748 2848734 1728000 1120734 823376 203289 94069 August 23377375 17022049 6355326 1806000 4549326 1420370 316997 2811959

September 20166066 15953895 4212171 1685000 2527171 1100653 248649 1177869 October 20925500 14736878 6188622 1647000 4541622 980838 252319 3308465 November 18549759 14797644 3752115 1620000 2132115 848876 267507 1015732 December 17661996 14886559 2775437 1474000 1301437 791725 238186 271526

Total $230362902 $187929803 $42433099 $20137000 $22296099 $9779889 $2861902 $9654308

( ) Denotes contra items 28

ANNUAL REPORT FOR 1960

REVENUE FREIGHT TRAFFIC STATISTICS-EXCLUDING TRUCK SERVICE

FREIGHT REVENUE AVERAGE

TONS TONSYEAR HAUL- PERCARRIED MILES PER

MILES TOTAL TON MILETON

(CENTS)

1951 51740580 16732323827 32339 $217832219 $421 1302 1952 49522089 16005309995 32320 222648097 450 1391 1953 46810989 15413226569 32927 215622726 461 1399 1954 43123214 14178678856 32879 197712105 458 1394 1955 45481060 95561748530 34216 205993029 453 1324

1956 45351213 15612344863 34425 209886542 463 1344 1957 42915573 14614118553 34025 212631339 495 1455 1958 40117213 13884510331 34610 205489920 512 1480 1959 40199394 14121939599 35130 201705278 502 1428 1960 38305568 13604642301 35516 189750236 495 1395

REVENUE PASSENGER STATISTICS-EXCLUDING BUS SERVICE

PASSENGER REVENUE AVERAGE

PASSENGERS PASSENGER DISTANCE PER YEAR

CARRIED MILES TRAVELED PER PASSENGER TOTAL

-MILES PASSENGER MILE (CENTS)

OTHER THAN COMMUTATION

1951 3341410 776958568 23252 $ 18484470 $553 2379 1952 3346346 739380708 22095 17569369 525 2376 1953 3158639 658842799 20858 15396026 487 2337 1954 3057733 599281006 19599 13582309 444 2266 1955 3003108 571128913 19018 12413340 413 2173

1956 3266663 696906549 21334 15758692 482 2261 1957 2943819 587947230 19972 14064509 478 2392 1958 2889740 549258597 19007 12969955 449 2361 1959 1839572 523514965 28459 12490275 679 2386 1960 1759253 515650913 29311 12095377 688 2346

CoMMUTATION

1951 4186842 94960045 2268 $ 1251058 $ 30 1317 1952 3899249 89299292 2290 1325955 34 1485 1953 3823231 88929041 2326 1316554 34 1480 1954 3920824 93543801 2386 1374494 35 1469 1955 4176751 98901556 2368 1463125 35 1479

1956 4150616 100135407 2413 1474073 36 1472 1957 4074228 98630820 2421 1463767 36 1484 1958 4338777 103055843 2375 1567002 36 1521 1959 5521115 123694172 2240 2818185 51 2278 1960 5036666 111139202 2207 3095340 61 2785

TOTAL

1951 7528252 871918613 11582 $ 19735528 $252 2263 1952 7245595 828680000 11437 18895324 261 2280 1953 6981870 747771840 10710 16712580 239 2235 1954 1955

6978557 7179859

692824807 670030469

9928 9332

14956803 13876465

214 193

2159 201

1956 7417279 797041956 10746 17232765 232 2162 1957 7018047 686578050 9783 15528276 221 2262 1958 1959 1960

7228517 7360687 6795919

652314440 647209137 626790115

9024 8793 9223

14536957 15308460 15190717

201 208 224

2229 2365 2424

BeglOnmg With year 1959 lOcludes cash fares single and round trip tickets sold for travel within suburban area which in prior yeaTS were included in Other than Commutation

29

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATISTICS OF OPERATIONS

TOTAL TRANSPORTATIONFREIGHT TRAINS PASSENGER TRAlNS SERVICE ITEMS I

1960 1959 1960 1959 1960 1959

RAlL-LINE Average miles of road operared 1 1deg--589_1---1deg586=_-------34-=68 -1-__394-=-9_1-----=10--597-1---I0-594=-

TRAlN MILES

Ordinary (wirh locomorives) 9554242 10152235 6185162 6740403 15739404 16892638 Ligh t (with locomotives) 1_----27--3-59_ 1__-----_24----42-=5_ 1_middot_-----=--------_1 __---c-_o---=-_ 1_--=-2~73-50-9_1_---2442-5_

Total (with locomotives) 9581601 10176660 6185162 6740403 15766763 16917063 Motor car trains bull middotICmiddotmiddotmiddotmiddot~ ----1----=----middotmiddot_1----------1~7-o1_=_60--1-____=_=65--4_8__7+--=-=-1-721-6_0-1-_________65_--487-

Total train miles 1_ __=9 0-58_1--6_deg 1 1__1deg 176--=66_deg--1 60-2_0_23_22_1 __68_0_5 89_deg_1 __15--7_83-923_1 __16--bull98_2-0-550_

LOCOMOTIVE MILES

Principal 9583849 10180397 6185162 6740403 15769011 16920800 Helper 81260 109822 286 726 81546 110548 Lig~t 104438 151874 35078 49266 139516 201140 TraIn sWItchIng 856137 864118 bull bull 856137 864118 Yard switching 1_ __=5-58757--2_1_--=-58---62-=-6-=48=_1 __~4--28-0-54__=31__--441--949-1 __60161_15_1 __630_4--59-=-7

Total locomotive miles 1-162213--2561----=-17-168859=_1---=6649-deg-=69=-1----723-234-4+2=2c862325_1_---=-24401203=_

CAR MILES

Loaded freight cars 431972870 466352092 517228 101495 432490098 466453587 Empty freigh tears I~26624=2gt490_127-=325-=-3~4~594-1------=--5==-- bull6471=-1------=-=-5o-6_01---266--248gt13--1_ 1-27-3gt5-35-154=-

Total loaded and empty freight cars 698215360 739886686 522869 102055 698738229 739988741 Caboose 1~_9285~9235-=-5-1-~1023=2-=-9-651=-1------=_1~--2101------=-~2~1~1=7--1-~9~86-0--5-6--5-1-=-1=_=0--33__1--7--68--

Total freight car miles 17deg8gtdeg742715-1-7502216233~7 1_----=524-079=-1_---=104172_ 1-7deg825982794=-1 _---750-320509=_

Passenger coaches 4913 3974 22864172 23715856 22869085 23719830 Sleeping and parlor cars (Company) 1812568 1817919 1812568 1817919 Sleeping cars (Pullman) 38383 35410 12685592 13337316 12723975 13372726 Club lounge dining and observation cars 547 bull 4989125 5250522 4989672 5250522 Combination passenger and head end cars 501995 659233 169149 142633 671144 801866 Mail express and baggage cars 2570197 2539863 21120653 22269656 23690850 24809519 Business cars 1---=--3-6~66-41--=-=---44---1-5 133-deg82_ 1_-----1--49-=-3deg8_ 1_--16-=-974-=6_1_-----_193---4657-_ 1_----shy

Total passenger car miles I~--=3215226~99-1-__=__3~282=63=__7_1-63-7--7--4~3--41_1--6-6-6-83-21--0+-66--9-2 65--847shy72deg4deg+-=-=-69--9--Grand total car miles 1 7_11 _227--4_1_4_1 753 498-974_1_6_429_84_2deg---1_6_67_8_7--=3_8_2_ 775 525--8--=34_ __8_2deg_2_86--bull356_

1 1

GROSS TON MILES

Locomotives and tenders (thousands) 1_ __=3-3942655-1 __3450-518--1__2--0_4_22_10---1 __21_6--2 1-13_ _---=5 436--865_ __5--612__=6311 1Freight cars contents and cabooses (thousands) 31409774 32603899 23551 4151 31433325 32608050 Passenger cars and contents (thousands) 1---1632517-1---------=-1670109=-1---41deg29-=-95_1--42999-8--4-1---4--26625o-12=-1------4=467o-O973=-

To tal freig ht and passenger (th0 usands) 1 31 57322-911_----32-- 771degdeg8=_1 41_265_46_ 1__4--=30_4 135_1 35--699--8__=37_ ____=_37-- 075_14__=3-shy1

TRAIN HOURS

Train hours in road service 473544 507565 137163 154436 610707 662001

REVENUE AND NONREVENUE FREIGHT TRAFFIC Tons of revenue freight ~8305568 40199394 Tons of nonrevenue freight middot1middotmiddotmiddot--- middotmiddot-=middot1middot---middotmiddotmiddotmiddot--- middotmiddot-1middotmiddot---middot---middotmiddotmiddot--- cl __ __ middot_middotmiddotmiddot1 _=-=-8421=-=35_ 1-------1_=_deg6--deg-53-7shy

Total tons of freight IC--- I~ +bull--- 1 --- ---1 392147-7deg3_1_---=-41=2-59093-1 Net ton miles revenue freight (thousands) 13604642 14121940 Net ton miles nonrevenue freight (thousands) middot1-middotmiddot--middot-middot=~-c- -1-------------middot1middotc----c_c I_____--_middot~middot-middotmiddotI_=-=---25797-5179c+----=-3_=_81c-0=-36--

Total net ton miles of freigh t (thousands) 1_c138530726=_1----=-145021~3=-301--104~35 _1 1646_1-1386421611----=-145deg2976

REVENUE PASSENGER TRAFFIC

Passengers carried 6795919 7360687 Passenger miles 626790115 647209137

MOTOR VEHICLE OPERATIONS EXCLUDED ABOVE Net ton miles revenue freight (thousands) 1124 1318 Passengers carried 995 1914 Passenger miles 1041447 991687

30

ANNUAL REPORT FOR 1960

STATISTICS OF OPERATIONS-CONCLUDED

-ITEMS 1960 1959 1958 1957 1956 1955

FREIGHT TRAIN STATISTICS AND AVERAGES

Gross ton miles trailing (thousands) 31573291 32771008 32413288 34236747 36203655 36228284

Eastbound 17124676 18176737 18125895 18805435 19734331 19787705 Westbound 14448615 14594271 14287393 15431312 16469324 16440579

Steam middot middot 135 133258 Dieselmiddotelectric 29107869 29901296 29705585 31129417 32597742 32536016 Electric 2465422 2869712 2707703 3107330 3605778 3559010

Per cent steam - middot 4 Per cent Dieselmiddotelectric 922 912 916 909 900 898 Per cent electric 78 88 84 91 100 98

Loaded freight cars per train 452 459 443 443 446 434 Empty freigh t cars per train 279 270 277 267 247 235

Total freight cars per train 731 729 720 710 693 669

Gross tons per train - 3305 3228 3157 3117 3070 2969 Net tons per train 1450 1428 1390 1373 1370 1323 Net tons per loaded car 321 311 313 310 307 305 Miles per car per day (serviceable freight) 393 390 357 370 387 377 Net ton miles per freight car-day 736 734 655 673 715 702 Train speed (train miles per train hour) 202 200 196 192 191 190 Gross ton miles (trailing) per train hour 66674 64565 61714 59780 58328 56315

PASSENGER TRAIN STATISTICS AND AVERAGES

Passenger car miles (excluding motor) - 64230016 66525240 69087808 75256765 86613202 72582117

Steam middot 13184 16967 Dieselmiddotelectric 64227781 66502614 65218200 71665998 81157901 66905429 Electric 2235 22626 3869608 3590767 5442117 5659721

Per cent steam middot Per cent Diesel-electric 1000 1000 944 952 937 922 Per cent electric middot 56 48 63 78

Cars per train (excluding motor) 1038 987 960 960 984 891 Revenue passengers per train 1012 952 898 865 894 812 Revenue passengers per car 166 165 161 160 168 175 Train speed (train miles per train hour) 452 441 444 439 447 429

YARD SWITCHINGSTATISTICS

Yard switching hours 1002686 1Oi0766 1063803 1184130 1251620 1274248

Steam middot 7 11279 Dieselmiddotelectric 994370 1038534 1056660 1174874 1235025 1246748 Electric 8316 12232 7143 9256 16588 16221

Per cent steam middot middot 9 Per cent Dieselmiddotelectric 992 988 993 992 987 978 Per cent electric 8 12 7 8 13 13

DENSITY STATISTICS

Per mile of road per day (freight service) Train miles ordinary Net ton miles

Per mile of road per day (passenger service) Train miles Car miles

25 3575

49 507

26 3753

47 463

27 3694

48 455

28 3896

47 450

30 4153

53 517

31 4161

48 425

31

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

REVENUE FREIGHT BY PRINCIPAL COMMODITIES-1960 AND 1959

INCREASE + OR1960 1959 DECREASE shyCOMMODITIES

TONS CARRIED

PERCENT OF TOTAL

TONS CARRIED

PERCENT OF TOTAL TONS PERCENT

PRODUCTS OF AGRICULTURE Wheat Corn Batley and tye Oats shy

Flour meal and mill products Citrus fruits Other fruits fresh and frozen

1708445 1325050

763672 347413

1275613 39049

123945

45 35 20

9 33

1

3

1653685 1281473

738948 298327

1242503 59289

135892

41 32 18 7

31 2 3

+ + + + + --

54760 43577 24724 49086 33110 20240 11947

33 34 33

165 27

341 88

Potatoes other than sweet 0 0 bull 229982 6 264312 7 - 34330 130 Other vegetables fresh and frozen Sugar beets Other products of agriculture

115520 213813

1588516

3

6 41

126388 191132

1480059

3

5 37

-+ +

10868 22681

108457

86 119

73 Total 7731018 202 7472008 186 + 259010 35

ANIMALS AND PRODUCTS Cattle calves sheep and goats 171861 4 198623 5 - 26762 135 Swine 21999 1 33892 1 - 11893 351 Fresh meats 386670 10 427610 10 - 40940 96 Poultry eggs butter and cheese 113551 3 128422 3 - 14871 116 Wool hides and leather 153604 4 161264 4 - 7660 47 Other animals and products 268968 7 265237 7 + 3731 14

Total 1116653 29 1215048 30 - 98395 81

PRODUCTS OF MINES Bituminous coal 4862060 127 5447866 136 - 585806 108 Coke 257305 6 296121 7 - 38816 131 Ores and concentrates Gravel and sand

462461 916755

12 24

385162 1166550

10 29

+ -

77299 249795

201 214

Stone broken ground or crushed Stone rough and finished Asphalt

1291164 77997

195521

34 2 5

1192897 71099

234070

30 2 6

+ + -

98267 6898

38549

82 97

165 Salt 148276 4 165384 4 - 17108 103 Other products of miles 1138894 30 1154731 28 - 15837 14

Total 9350433 244 10113880 252 - 763447 75

PRODUCTS OF FORESTS Logs posts poles and cordwood 1290191 34 1604736 40 - 314545 196 Pulpwood 1028793 27 966773 24 + 62020 64 Lumber and mill products 1845337 48 2434155 61 - 588818 242 Veneer and builtup wood 467827 12 520054 13 - 52227 100 Other products of forests 376413 10 259064 6 + 117349 453

Total 5008561 131 5784782 144 - 776221 134

MANUFACTURES AND MISCELLANEOUS Refined ~etroleum and products 1175165 31 1258601 31 - 83436 66 Sugar ta Ie syrups and molasses Iron and steellroducts

304542 2251993

8 59

293861 2299049

7 57

+ -

10681 47056

36 20

Machinery an boilers 222962 6 230072 6 - 7110 31 Cement Brick building tile and artificial stone

1242018 191608

32 5

1152635 199113

29 5

+ -

89383 7505

78 38

lime and plaster 73696 2 81785 2 - 8089 99 Agricultural implements traCtors and parts 155626 4 206217 5 - 50591 245 Autos trucks parts and tires Beverages

745090 599592

19 16

685152 613561

17 15

+ -

59938 13969

87 23

Ice 32950 1 31716 1 + 1234 39 Fertilizers Paper and paper products

590481 1191363

15 31

535770 1200754

13 30

+ -

54711 9391

102 8

Canned food Jroducts 985346 26 997315 25 - 11969 12 Scrap iron an scrap steel 598594 15 758925 19 - 160331 211 Building paper roofing and woodwork 434465 11 460040 12 - 25575 56 Other manufactures and miscellaneous 4165926 109 4435508 110 - 269582 61

Total 14961417 390 15440074 384 - 478657 31

GRAND TOTAL CARLOAD TRAFFIC 38168082 996 40025792 996 - 1857710 46

ALL lCl FREIGHT 137486 4 173602 4 - 36116 208

GRAND TOTAL CARLOAD AND lCi TRAFFIC 38305568 1000 40199394 1000 - 1893826 47

32

ANNUAL REPORT FOR 1960

NUMBER OF EMPLOYEES AND COMPENSATION

REGULAR EMPLOYEES TOTAL COMPENSATION ALL EMPLOYEES PART TIME

EMPLOYEES CHARGED ToAVERAGE CoMPENSATION

YEAR Noop

EMPLOYEES (MIDDLE

OP MONTH COUNT)

CoMPENSATION

AVERAGE COMPENSATION

PER EMPLOYEE

(NOT SUBJECT TO

CONTINUING AUTHORITY

OP RAILROAD)

TOTAL COMPENSATION OPERATING

EXPENSES

ADDITIONS AND

BETTERMENTS AND OTHER ACCOUNTS

1928 48129 $ 81744769 $1698 $135855 $ 81880624 $ 75548543 $ 6332081 1933 26493 39042823 1474 129469 39172292 36740362 2431930 1938 28988 52830262 1822 100092 52930354 48224635 4705719 1943 35377 90305409 2553 145093 90450502 84109945 6340557 1948 38268 138490345 3619 172016 138662361 126543269 12119092 1950 33668 128201025 3808 167342 128368367 121226784 7141583 1951 33846 143260363 4233 219693 143480056 134493624 8986432 1952 32550 145397263 4467 149515 145546778 138390501 7156277 1953 31138 138117562 4436 145500 138263062 131304863 6958199 1954 27961 126272397 4516 143400 126415797 120564532 5851265 1955 27936 126447937 4526 139330 126587267 120732130 5855137 1956 27408 134534522 4909 123452 134657974 126936601 7721373 1957 26007 133239878 5123 117455 133357333 125221025 8136308 1958 23402 128237334 5480 119269 128356603 123103272 5253331 1959 middotmiddot 22243 128292584 5767 107083 128399667 122031078 6368589 1960 20229 121037664 5983 98143 121135807 114993442 6142365

NUMBER OF EMPLOYEES AND COMPENSATION BY STATES

REGULAR EMPLOYEES PART TIME TOTAL

AVERAGE EMPLOYEES COMPENSATIONSTATE

AVERAGE TOTAL CoMPENSATION TOTAL ALL NUMBER COMPENSATION PER COMPENSATION EMPLOYEES

EMPLOYEE

Illinois bull 5977 $ 35954281 $6015 $18179 $ 35972460 Iowa 2062 12410458 6019 5105 12415563 Wisconsin bull 5272 30334008 5754 21200 30355208 Minnesota 2446 14392068 5884 8726 14400794

122 906621 7431 0 906621~~~~~fmiddotmiddotmiddotmiddotmiddot 346 2035311 5882 10780 2046091 Indiana 289 1726773 5975 9180 1735953 South Dakota 902 5244002 5814 180 5244182 North Dakota bullbull 98 524782 5355 2599 527381 Moncana bull 1060 6740641 6359 22074 6762715 Idaho 94 574143 6108 0 574143 Washington 1412 9145616 6477 120 9145736 All otherbullbullbullbullbull 149 1048960 7040 0 1048960

Total 20229 $121037664 $5983 $98143 $121135807

TOTAL PAYROLLS AND COMPANY CONTRIBUTIONS AVERAGE PER EMPLOYEE

COMPANY CoNTRIBUTIONS STRAIGHT TIME RATETOTAL AVERAGE

PAYROLLSshyYEAR RETIREMENT AND HEALTH AND TOTAL PER AVERAGE INCREGULAR

UNEMPLOYMENT WELPARE EMPLOYEE PER OVEREMPLOYEES TAXES BENEFITS HOUR 1939

1950 $128201025 $7234363 $135435388 $4023 $1580 1179 1951 143260363 7774582 151034945 4463 1754 1419 1952 145397263 7696578 153093841 4703 1852 1554 1953 138117562 7441326 145558888 4675 1895 1614 1954 126272397 7035232 133307629 4768 1945 1683 1955 126447937 7276300 $ 624381 134348618 4809 1959 1702 1956 134534522 8581092 1403449 144519063 5273 2130 1938 1957 133239878 8692650 2106181 144038709 5538 2290 2159 1958 128237334 8420346 1934613 138592293 5922 2465 2400 1959 128292584 9894538 1819163 140006285 6294 2566 2539 1960 121037664 9969699 1646241 132653604 6558 2638 2639

33

ANNUAL REPORT FOR 1960

Notes to Financial Statements

December 31 1960

1 Investments in affiliated companies include $7023010 pledged as collateral to mortgage bonds The Companys equity in the retained income since acquisition of unconsolidated subsidiaries (as shown by their unaudited financial statements) amounted to $1731352 at December 31 1960 of which $376282 represents 1960 net income

Other income includes dividends of $400000 in 1960 and $1500000 in 1959 from Milwaukee Land Company

2 The road and equipment property is stated at original cost or estimated original cose as determined by the Interstate Commerce Commission plus additions and betterments at cost less retirements and depreciation Consistent with the practice generally followed by Class 1 Railroads the Company had not provided for deshypreciation on road property prior to 1942 however a provision for past depreciation was recorded at 30 of original cost as of January 1 1944

3 In determining the Federal income tax liability for 1960 the Company deducted approximately $6345000 from income for amortization of emergency facilities declining balance depreciation and various differences in depreciation bases and rates in excess of recorded depreciation As a result no provision is required for Federal income tax and the loss carry forward is increased by apptoximately $4753000 At December 311960 the total loss carry forward is $6997000 which may result in future tax reductions of $3638000

The accumulated tax reductions resulting from amortization of emergency facilities and declining balance depreciation amounted to approximately $23178000 at December 31 1960

The Federal income tax returns of the Company through the years 1951 have been examined by the Internal Revenue Service and the Companys tax liabilities have been settled through that year For the years 1952 1953 and 1954 the Internal Revenue Service has proposed additional assessments which are being contested by the Company and in final settlement are not expected to have a material effect upon the financial position or results of operations

4 Reserve for vacation pay of approximately $5500000 payable in 1961 and debt due within one year are not included in current liabilities

5 The Company was liable as guarantor jointly with other railroads of certain obligations of affiliated companies amounting to approximately $111845000 at December 31 1960

19

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

INVESTMENTS-DECEMBER 31 1960

EXTENT OF DESCRIPTION

NUMBER OF SHARES

CONTROL PER CENT

LEDGER AMOUNT

AFFILIATED COMPANIES WHOlly-OWNED SUBSIDIARIES

CAPITAL STOCKS Milwaukee Land Company A 5000 100 500000 The Milwaukee Motor Transportation Company A 500 100 50000

TOTAL CAPITAL STOCKS 550000 NOTE

Milwaukee Land Company A 100 2652000 ADVANCES

Milwaukee Land Company 100 905640 The Milwaukee Motor Transportation Company 100 1335353

TOTAL ADVANCES bullbull 1 ~2~24~0~9~9~3---TOTAL INVESTMENTS-WHOLLy-OWNED SUBSIDIARIES 5442993

JOINTLY-OWNED TERMINAL SWITCHING AND OTHER COMPANIES CAPITAL STOCKS

Chicago Terre Haute amp Southeastern Railway Company 4075505 5398 1 Chicago Union Station Company A 7000 25 7000 Davenport Rock Island amp North Western Railway Company A 15000 50 1750000 Des Moines Union Railway Company A 1000 50 100000 Des Moines Union Railway Company B 1000 50 26000 Indiana Harbor Belt Railroad Company A 15200 20 1520000 Kansas City Terminal Railway Company C 183333 8~ 183333 Minneapolis Eastern Railway Company A 625 50 15475 Packers Car Line Company 306 956 3060 Railway Express Agency Incorporated 26 26 2600 The Minnesota Transfer Railway Company A 913 11yg 91300 The Pullman Company 9426 128 348762 The St Paul Union Depot Company A 1036 12Y2 130475 Trailer Train Company 500 294 98860

TOTAL CAPITAL STOCKS 4276866 NOTE

Railway Express Agency Incorporated 26 751804 ADVANCES

Chicago Union Station Company 25 4786146 Davenport Rock Island amp North Western Railway Company 50 1292103 Des Moines Union Railway Company 50 855112 Kansas City Terminal Railway Company 8~ 647294 Packers Car Line Company 956 72464 The Minnesota Transfer Railway Company 11yg 353014 The St Paul Union Depot Company 12Y2 211073

TOTAL ADVANCES bull middot1 __--c~8~2~1~7L2~0~6c--_ TOTAL INVESTMENT-AFFILIATED COMPANIES 18688869

OTHER COMPANIES STOCKS

Miscellaneous 7676 DEBENTURES

Century 21 Exposition Inc 25000 NOTE

C H Lien Construction Company 1500 SALE AGREEMENTS

Best Built Company 35750 CargiIl Incorporated 390000 General Warehouse amp Transportation Company 24000 J K Fiddes 59200 J Lentin Lumber Company 39900 Monarch Warehouses Incorporated 27360 Steven] Kipper Jr 34039 Thisted Motor Company 11520 Other companies and individuals 14656

TOTAL SALE AGREEMENTS 636425 TOTAL INVESTMENT-OTHER COMPANIES

TOTAL INVESTMENTS

670601 $19359470

I--------=-=-=c--=-=--shy

A-Pledged under Chicago Milwaukee Sc Paul and Pacific Railroad Company First Mortgage except Directors qualifying shares B-Deposited with IowamiddotDes Moines National Bank Des Moines Iowa under Stock Trust Agreement dated June 14 1948 and pledged

under the First Mortgage C-Deposited with First National Bank of Kansas City Mo under Stock Trust Agreement dated June 12 1909 and pledged under the

First Mortgage except Directors qualifying shares

20

ANNUAL REPORT FOR 1960

INVESTMENT IN PROPERTIES

ACCOUNT BALANCE AT JANUARY 1

EXPENDITURES DURING THE YEAR

CREDITS FOR PROPERTY RETIRED DURING THE YEAR

BALANCE AT DECEMBER 31

J

ROAD Engineering Land for transportation purposes Other right-of-way expenditures Grading Tunnels and subways Bridges trestles and culverts Ties Rails Other track material Ballast Track laying and surfacing Fences snowsheds and signs Station and office buildings Roadway buildings Water stations Fuel stations Shops and enginehouses Storage warehouses Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous structures Roadway machines Roadway small tools Public improvements-Construction Other expenditures-Road Shop machinery Power-plant machinery

$ 19526006 39048637

381312 143144397

9833072 76929583 34650264 68850190 47424085 26425043 33120819

5401156 26590033

2113899 1091355

746608 19544030

64349 1607522 6300222

21437281 1612483 9737209

673072 8486729

321671 14661137

335 7212584 5500804

$ 80269 $ 47281 105987 319878 77192

258951 255767 114819 42593

1013757 304057 116894 47625 251013 51045 471429 50791

90866 25183 196827 57265

13843 2672 450470 826144

7026 37792 15021 69162

3325 173 537467 38753

29057 58332

564767 157799 360010 104017

612 13590 5060

79 5656 588388 61627

1042 270 232514 59940

422650 96923

3149 20334

$ 19558994 38834746

458504 143147581

9905298 77639283 34719533 69050158 47844723 26490726 33260381

5412327 26214359

2083133 1037214

749760 20042744

64349 1578247 6707190

21693274 1611871 9745739

667495 9013490

322443 14833711

335 7538311 5483619

TOTAL ROAD 632435887 6020402 2746751 635709538

EQUIPMENT Locomotives Freight-train cars Passenger-train cars Floating equipment Work equipment Miscellaneous equipment

124658042 169559340

31348424 278731

6893714 2333999

248407 598587 13410931 6445607

237485

91258 221157

216303 162850

124307862 176524664

31110939 278731

6763815 2387452

TOTAL EQUIPMENT 335072250 13966899 7665686 341373463

GENERAL EXPENDITURES 38292664 260 84367 38208557

r IMPROVEMENTS ON LEASED PROPERTY 618871 270 619141

TOTAL OPERATING PROPERTIES 1006419672 19987831 10496804 1015910699

MISCELLANEOUS PHYSICAL PROPERTY Non-operating property Track material loaned

7007150 206040

102359 6922

141991 7926

6967518 205036

TOTAL MISCELLANEOUS PHYSICAL PROPERTY 7213190 109281 149917 7172554

TOTAL PROPERTIES BEFORE RECORDED DEPRECIATION $1013632862 $ 20097112 I $ 10646721 $ 1023083253

21

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

CONTINGENT LIABILITIES WITH RESPECT TO SECURITIES OF OTHER COMPANIES AS OF DECEMBER 31 1960

ITEMS AMOUNT

CHICAGO UNION STATION COMPANY 1 First Mortgage Bonds 3Ya Series F due July 1 1963 $ 13718000 2 First Mortgage Bonds 2Ys Series G due July 1 1963 34030000 3 Note 5ri due September 1 1961 2500000

50248000 Principal and interesr guaranteed jointly and severally by the Railroad Com~any and 3 other proprietors at time of issue The

Railroad Company with other proprietors has agreed that gross rental to e paid bJ them for use of Chicago Union Station faciliries shall include a sum sufficient ro pay interest on all of these securiries an the payment into the Retirement Fund for First Mortgage bonds beginning in 1955 and to advance amounts requited to pay at maturity ptincipal of Item 3

INDIANA HARBOR BELT RAILROAD COMPANY 1 First Mortgage Bonds 5Ya due June I 1982 7235000 2 Equipment Trust Certificates 2 due annually Segtember 15 1961 to September 15 1964 772000 3 Equipment Trust Certificates 2ri due annually Fe ruary 15 1961 to February 15 1965 600000

8607000 Principal and interest on the 5Ya Bonds is guaranteed jointly and severally by the Railroad Company and 3 other proprietors

The Railroad Company and other proprietors severally guarantee in proportion to their stock holdings the payment by the Belt Railroad of the principal of and dividends on equipment obligations Items 2 and 3

KANSAS CITY TERMINAL RAILWAY COMPANY 1 First Mortgage Serial Bonds due annually October 1 1961 to October I 1974 38602000

Under a certain operating agreement the Railroad Company and 11 other proprietors are obligated to pay to the Terminal Company or in case of default to the Mortgage Trustee in equal shares the principal of these bonds as they mature in the nature of nonmiddot interest bearing advances and interest thereon as rental

PACKERS CAR LINE COMPANY Conditional Sale Agreements 298272

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-956

THE MINNESOTA TRANSFER RAILWAY COMPANY 1 3yeni Sinking Fund Promissory Notes dueJune 11976 1461600

Under provisions of the bymiddotlaws of the Transfer Co the Railroad Company and 8 other proprietors are required to conmiddot tribute on an ownership basis to (a) an annual sinking fund for these Notes equal to $41412 payable on or before May 20 of each year and (b) semimiddotannual installments of interest on the Notes

THE ST PAUL UNION DEPOT COMPANY 1 First and Refunding Mortgage Bonds 3Ya Series B due October I 1971 10891000

Guaranteed jointly and severally by the Railroad Company and 7 other proprietors each of which is also obligated to advance its ownership proportion of amounts required for Sinking Fund payments and to pay its proportion based upon use of the interest on the bonds

TRAILER TRAIN COMPANY Conditional Sale Agreements 1736741

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-294

TOTAL $111844613

22

ANNUAL REPORT FOR 1960

LONG-TERM DEBT DECEMBER 31 1960

DESCRIPTION DATE OF

ISSUE DATE OF

MATURITY

AMOUNT ORIGINALLY

ISSUED OR ASSUMED

AMOUNT AS OF

DBc 31 1960

AMOUNT HELD BY COMPANY

AMOUNT ACTUALLY

OUTSTANDING RATE PER

CENT

INTEREST

PAYABLB ACCRUED DURING

YBAR First mongage bonds Series A General mortgage income bonds

Series A General mortgage convertible inmiddot

come bonds Series B Five per cent income debentures

Series A The Bedford Belt Ry Co Grsr

mongage bonds The Southern Indiana Ry Co first

mongage bonds Chicago Terre Haute and 5ourbmiddot

eastern Ry Co Firsr and refunding mortgage

bonds Income mortgage bonds

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

I 1944

11944

11944

11955

11946

11946

I 1946 I 1946

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

11994

12019

12044

12055

11994

I 1994

11994 I 1994

$ 59515100

57256600

51422100

60000000

350000

7287000

9571000 6335800

$ 53784300

33905200

34640400

58500000

333000

7236000

9571000 6335800

$ 346300

408500

733100

300000

144000

256000

2051000 1597000

$ 53438000

33496700

33907300

58200000

189000

6980000

7520000 4738800

4

41

41

5

4~

44

4~ 4~

J amp J

April

April

MampS

JA amp J

JA amp J

JA amp J JA amp J

$ 2145645

1513512

1534381

2903400

7961

296938

320161 201133

Eb~ro~)nt obl~gati~~~ ~~ederails 163723218 75220900 75220900 2884166 Totallongmiddotterm debe $415460818 $279526600 $ 5835900 $273690700 $11807297

$100000 pledged undet ChIcago Terre Haute and Southeastern RaIlway Company Fust and refundmg mongage $1515000 pledged under Chicago Milwaukee St Paul and Pacific Railroad Company First mongage

EQUIPMENT OBLIGATIONS DECEMBER 31 1960

INTBRESTDATB OF DATB OF ORIGINAl AMOUNT AMOUNT PRINCIFAL

DESCRIPTION LBASE OR FINAL COST OF ORIGINALLY OUTSTANDING PAYABLB RATE ACCRUBD AGREEMENT MATURITY EQUIPMENT ISSUED DBc 31 1960 DURING 1961 PER PAYABLB DURING

CENT YEARI EQUIPMENT TRUST CERTIFICATES Series HH Apr 11949 Apr 11964 $ 8112742 $ 6060000 $ 1414000 $ 404000 2Ji AampO $ 37260 Series JJ Sept I 1949 Sept 1 1964 7604384 5640000 1504000 376000 2li MampS 34846 Series KK Oct I 1949 Oct 11964 ~026868 4500000 1200000 300000 2~ AampO 30375 Series LL June I 1950 June 1 1965 289514 4650000 1395000 310000 24 J amp D 36038 Series MM Nov 11950 Nov I 1965 7251863 5430000 1810000 362000 2n MampN 48554 Series NN June I 1951 June I 1961 7254678 5300000 265000 265000 2Ya JampD 17776 Series 00 OCt I 1951 Oct 11966 10053530 7500000 3000000 500000 2Ya AampO 93437 Seties PP bull Mar 11952 Mar 11967 3215855 2400000 1040000 160000 2Ya MampS 31817 Series QQ Sept I 1952 Sept 1 1967 5441323 3990000 1862000 266000 3Va MampS 61651 Series RR Jan I 1954 Jan 11969 10379112 7650000 4335000 510000 3Va J ampJ 139454 Series SS July 11954 July 11969 9931620 7800000 4680000 520000 24 J ampJ 132275 Series TT Nov 1 1954 Nov I 1969 9141903 7200000 4320000 480000 2Ya MampN 132250 Series UU Jan 11956 Jan 11971 9655380 7500000 5250000 500000 3raquo J amp J 181407 Series VV (1st Install) Feb I 1957 Feb 11972 3000000 2300000 200000 4 FampA 94667 11745718 Series VV (2nd InSltaII) Feb I 1957 Feb I 1972 6000000 4600000 400000 4Vs F ampA 207084 Series WW Jan 11958 Jan 11973 6814810 5400000 4500000 360000 4gtil J amp J 189338 Series XX Feb I 1959 Feb 11974 7419495 5850000 5265000 390000 41 FampA 242775Series YY (1st Install) Feb I 1960 Feb I 1975 3000000 2900000 200000 4Ya FampA 121878 Series YY (2nd Install) Feb 11960 Feb I 1975 9683950 4650000 4495000 310000 4~ FampA 128844 CONDITIONAL SALE AGREEMENTS

The FitS( National Bank of Chimiddot ca~o Assignee of the Sellers

Paci c Car amp Foundty Co May I 1956 Nov I 1964 1843205 1428400 731357 182916 395 FMAampN 32094First Wisconsin Narional Bank of

Milwaukee and Northwestmiddot ern National Bank of Minneshyapolis Assignees of tbe SeUers

General Motors Corpn (Electro-Motive Div) Feb 25 1953 May 11961 1543977 1155000 80558 80558 3 FMAampN 4594

Fairbanks Motse amp Co July 15 1953 Nov 1 1961 531102 396000 54830 54830 3 FMAampN 2380American Locomotive Co July 15 1953 Nov 1 1961 529935 396000 54830 54830 3 FMAampN 2380Baldwin-LimamiddotHamilton

Corporation July 15 1953 Nov 1 1961 357568 264000 36553 36553 3 FMAampN 1587Seattle-Fitst National Bank Asmiddot

Bai1i~e_~i~Sfa~il~~n Corporation SePt I 1953 Nov 1 1961 357568 264000 36979 36979 335 FMAampN 1791

General Motors Cotpn (Electro-Motive Div) Sept I 1953 Nov 1 1961 1670914 1236000 173128 173128 335 FMAampN 8385

American Locomotive Co Sept I 1953 Feb 11962 529935 396000 69048 55008 335 FMAampN 3135Continental Illinois National Bank

and Ttust Company of Chishycago Assignee of tbe SeUers

Pullman-Srandard Car Manumiddot facturing Co May 11958 Nov I 1973 4920125 4920125 4245616 328008 440 MampN 195836

General American Transpotta tion Corporation May I 1958 Nov I 1973 6165438 6165438 5296389 411029 440 MampN 244862

United States Railway Equipment Co May 11958 Nov 1 1973 570706 570706 494612 38047 440 MampN 22740

General Motors Cotpn Jan 15 1959 Mar I 1974 8680000 8680000 7812000 578666 5 MampS 402656 Total equipment obligations $163723218 $129391669 $75220900 $ 8843)52 $ 2884166

PAYMENTS MATURING IN YEARS ENDING December 31 1961 $ 8843552 December 31 1966 $ 6151751 December 311971 $ 3465751December 31 1962 8108041 December 31 1967 5571751 December 311972 291751December 311963 8101627 December 31 1968 )225751 Decembet 31 1973 bull 2370271Decembet 31 1964 bull 7862066 December 31 1969 4970751 Decembet 31 1974 994335December 311965 6668751 December 31 1970 3715751 December 311975 _ 255000

Total $75220900

23

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

MILES OF ROAD BY STATES DECEMBER 31 1960

ROAD OPERATED

STATE OWNED SOLELY OWNED JOINTLY TRACKAGELEASED TOTALMAIN BRANCH MAIN BRANCH RIGHTS

LiNE LINE LINE LINE

Idaho 11276 11083 9middot11 23270 Illinois 43296 11755 240 14 13231 68536 Indiana 15591 3679 19270 Iowa 119993 51468 08 04 10 6706 178189 Kansas 705 705

Michigan 5782 11978 25 583 18368 Minnesota 75531 35154 503 2270 19410 132868 Missouri 13002 944 1651 15597 Montana 74753 47322 2999 46 125120 Nebraska 562 562

North Dakota 10250 26329 110 36689 South Dakota 104314 69528 173842

31469 47426 2688 5000 20110 106693i~~~~J~n 103928 47228 1634 7051 159841

Total 609185 362950 4383 12056 10 70966 1059550

Includes 97 mile owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contraCt

MILES OF TRACK DECEMBER 31 1960

OWNED OWNED TRACKAGEITEMS LEASED TOTALSOLELY JOINTLY RIGHTS

Miles of Road (First Main Track) Operated 972135 16439 10 70966 1059550 Not operated 362 362

Additional Main Tracks Operated 69332 1424 41 31329 102126 Not operated

Yard Tracks and Sidings Operated 321153 25542 219 47997 394911 Not operated 228 2626 2854

I-----f------f-----middotI-----I----shyTotal operated 1362620 43405 270 150292 1556587

Total not operated 590 2626 3216 I-----f-----Imiddot-----I-----I----shy

Grand Total 1363210 46031 270 150292 1559803

Miles of Road operated includes 97 mile Yard Tracks and Sidings operated includes 124 miles owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contract

24

ill ~ It

I I I i I I I bull II III

ANNUAL REPORT FOR 1960

DETAILED STATEMENT OF RAILWAY OPERATING REVENUES AND EXPENSES

RAILWAY OPERATING REVENUES

1960 1959 INCREASE DECREASE TRANSPORTATION

Freight $189560907 $201536333 middot0 $ 11975426 Passenger 15174969 15282171 107202 Baggage 79806 86066 middot 6260 Parlor and chair car 83476 91957 8481 Mail 9418410 8862116 $ 556294 Express 3030579 3180656 150077 Other passenger-crain 107746 100303 7443 Milk 18260 30216 middot 11956 Switching 5979910 6591066 611156

1------1------1-------1------shyTOTAL TRANSPORTATION REVENUE 223454063 235760884 12306821

INCIDENTAL

Dining and buffet 1521218 1527536 6318 Station crain and boat privileges 57552 56068 1484 Storage-Freight 8015 11196 - 3181 Storage-Baggage 3631 3837 - 206 Demurrage 1240131 1248537 8406 Communication 55650 72541 16891 Rents of buildings and other property 257841 246697 11144 Miscellaneous 461149 507969 middot middot0 46820

TOTAL INCIDENTAL OPERATING REVENUE 3605187 3674381 69194

JOINT FACILITY

Joint facility-Credit 3315646 2620693 694953 Joint facility-Debit (11994) (14133) (2139)

TOTAL JOINT FACILITY OPERATING REVENUE 3303652 2606560 697092

TOTAL RAILWAY OPERATING REVENUE $230362902 $242041825 $ 11678923

( ) Denotes concra items

RAILWAY OPERATING EXPENSES

1960 1959 INCREASE DECREASE MAINTENANCE OF WAY AND STRUCTURES

Superincendence $ 3108012 $ 3388761 $ 280749 Roadway maincenance 2861659 2867371 5712 Tunnels and subways 10889 11354 465 Bridges trestles and culverts 986082 1198575 212493 Ties 1793766 1827106 33340 Rails 592902 894914 302012 Other track material 1336407 1996881 660474 Ballast 217365 408471 middot 191106 Track laying and surfacing Fences snowsheds and signs

6515560 319315

7505265 398716

989705 79401

Station and office buildings 828484 1014046 185562 Roadway buildings 55448 86514 31066 Water stations Fuel stations

12115 26908

21831 16802 $ 10106

9716

Shops and enginehouses 574222 542976 31246

25

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

RAILWAY a PERATING REVENUES AND EXPENSES- CONTINUED RAILWAY OPERATING EXPENSES-CONTINUED

MAINTENANCE OF WAY AND STRUCTURES

Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous StruCtures Road property-Depreciation _ Retiremenes- Road Roadway machines _ Dismantling retired road property Small cools and supplies Removing snow ice and sand Public improvemenes-Maintenance Injuries co persons Insurance Stationery and printing Other expenses Right-of-way expenses Maineaining joint cracks yards and other facilities-Debit Maintaining joint tracks yards and other facilities-Credit

TOTAL MAINTENANCE OF WAY AND STRUCTURES

MAINTENANCE OF EQUIPMENT

Superintendence Shop machinery Power-plant machinery Shop and powerplant machinery-Depreciation Dismantling retired shop and powermiddotplane machinery Other locomotives-Repairs Freight-train cars-Repairs Passenger-train cars-Repairs Work equipment-Repairs Miscellaneous equipment-Repairs Dismantling retired equipment Retirements-Equipment Equipmene- Depreciation Inj uries to persons Insurance Stationery and printing Other expenses Taint maintenance of equipment expenses-Debit Taint maineenance of equipmene expenses-Credit

TOTAL MAINTENANCE OF EQUIPMENT

TRAFFIC

Superintendence Outside agencies Advertising Traffic associations Industrial and immigration bureaus Insurance Stationery and printing Other expenses

1960 1959 INCREASE DECREASE

$ 56714 $ 36447 $ 20267 bullbullbullbullbullbullbull _0 bullbullbullbullbullbull

935578 909129 26449 bullbull 0 bullbullbullbullbullbullbull 0 bullbullbullbullbull

bullbullbullbullbullbull 0 bullbullbullbullbullbull bull bullbull 1838913 1653168 185745 31898 33384 $ 1486 301492 355954 54462 9685 11190 middot 1505 5028247 4953681 74566 197350 241483 44133 706168 892299 186131 107360 148842 middot 41482 780012 825073 45061 841898 1093119 251221 736255 713553 22702 0 326277 442052 115775 50816 46225 4591 71268 87971 16703 419344 470012 50668bull bullbull 0 bullbullbullbullbullbullbullbullbullbull

43266 45762 2496

2725332 2842160 middot 116828

(755037) (550863) (204174) 1------1------1-------1------shy

33691970 37430224 3738254

1716762 1720882 41200 bullbullbullbullbullbullbullbullbullbullbullbullbullbullbull

521695 506499 15196

133941 153222 19281

284088 285333 1245

3681 856 2825

12448450 13197294 748844

9119749 10867539 1747790

2844061 3581261 737200

249163 301007 middot 51844

196990 196551 439

110983 91095 19888

(139163) (764585) (625422)

10468468 10143824 324644

245956 297309 51353

66754 68018 1264

42632 59005 16373

477426 563338 85912

292109 629586 337477

( 35052) (35250) (198)

39048693 41862784 2814091

1853253 1775877 77376

3420570 3680896 260326

641695 669595 27900

316941 281954 34987

50793 58011 7218

991 875 116

267539 246898 20641

29672 34959 5287 1------1------1middot------1------shy

TOTAL TRAFFIC EXPENSES $ 6581454 $ 6749065 $ 167611

( ) Denotes contra items

26

ANNUAL REPORT FOR 1960

RAILWAY OPERATING REVENUES AND EXPENSES-CONCLUDED

RAILWAY OPERATING EXPENSES-CONCLUDED

1960 1959 INCREASE DECREASE TRANSPORTATION

Superintendence $ 2981453 S 2814960 $166493 Dispatching trains 737390 807806 $ 70416 Station employees 12568811 13277513 708702 Weighing inspection and demurrage bureaus 307278 325534 bullbullbullbullbullbull 0 bullbullbullbullbullbullbullbullbull 18256 Station supplies and expenses 1091896 1140062 bullbull 0 bullbullbull 0 bullbullbullbullbullbull 0 bullbull 48166 Yardmasters and yard clerks 3991133 4119498 bullbullbullbullbullbull 0 bullbullbullbullbullbull 0 bullbull 128365 Yard conductors and brakemen 9303622 9647318 343696 Yard swirch and signal tenders 730410 755025 24615 Yard enginemen 6155278 6362440 207162 Yard switching fuel 923737 988987 65250 Yard switching power purchased 11946 15258 bullbull 0 bullbullbullbullbullbullbullbullbullbullbullbullbull 3312 Water for yard locomotives 17360 19948 2588 Lubricants for yard locomotives 83523 109472 25949 Other supplies for yard locomotives Enginehouse expenses-Yard

49721 498339

48817 542983

904

44644

Yard supplies and expenses Operating joint yards and terminals-Debit Operatin~ joint yards and terminals-Credit Train engInemen Train fuel Train power purchased Water for train locomotives

466959 5790981 (683719)

9533667 7243332

864933 94310

441246 5978628 (685475)

9966568 7758783

907295 105164

25713 middot bull bullbull 0 bullbullbullbullbullbullbullbullbullbull 0

middot

187647

(1756) 432901 515451 42362 10854

Lubricants for train locomotives 795622 938600 142978 Other supplies for train locomotives Enginehouse expenses-Train Trainmen

210707 1124921

12091384

202708 1222756

12613963

7999 bullbullbullbull 0 bullbullbullbullbullbullbull bullbullbullbull

97835

522579 Train supplies and expenses 6340264 6660876 320612 Operating sleeping cars 715113 526531 188582 Signal and interlcker operation CrOSSIng protectIOn

1049887

721750 1037947

806370 11940

middot

84620 Drawbridge operation 215086 258082 42996 Communication system operation 1060497 1081772 21275 Operating Boating equipment 11796 10985 811 Srationery and printing 412827 392820 20007 Other expenses 817489 848149 30660 Operating joint tracks and facilities-Debit 1170056 1311393 141337 Operating joint tracks and faciliries-Credir Insurance

(786053)

78437 (751937)

92514 (34116)

14077 Clearing wrecks Damage to property

265853 120728

230128 206210

35725

85482

Damage to live stock on right-of-way Loss and damage-Freight

80817

2795442 53816

2942960 27001

147518 Loss and damage-Baggage 5528 722 4806 Injuries to persons 1708733 1714453 5720

TOTAL TRANSPORTATION EXPENSES 93769244 97849648 4080404

MISCELLANEOUS OPERATIONS Dining and buffet service 2855845 2888241 32396 Operaring joint miscellaneous facilities-Debit 149757 207418 57661

J------J------I-------I------shyTOTAL MISCELLANEOUS OPERATIONS 3005602 3095659 90057

GENBRAL Salaries and expenses of general officers 1421416 1331832 89584 Salaries and expenses of clerks and attendants 6821635 6920559 98924 General office supplies and expenses 753564 727092 26472 Law expenses 831662 811940 19722 Insurance 33708 6002 27706 Pensions and gratuities 818190 917286 99096 Stationery and priming 348137 336267 11870 Valuation expenses 53068 59453 6385 Other expenses 501292 520844 19552 General joint faciliries-Debit 258783 241859 16924 General joint faciliries-Credit (8615) (8933) (318)

TOTAL GENERAL EXPENSES 11832840 11864201 middot 31361

GRAND TOTAL RAILWAY OPERATING EXPENSES $187929803 $198851581 $10921778

( ) Denotes contra items

27

bullbullbull

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

ANALYSIS OF INCREASES AND DECREASES IN TOTAL RAILWAY OPERATING EXPENSES 1960 COMPARED WITH 1959

MAINTENANCE MAINTENANCE TRANSshyITEMS OF WAY AND OP ALL OTHER TOTALPORTATIONSTRUCTURES EQUIPMENT

LABOR General wage increases + $ 360933 + $ 323486 + $1370434 + $ 289045 + $ 2343898 Straight time worked - 2213317 - 2135307 - 4273302 - 680973 - 9302899 Overtime worked - 76922 - 10613 - 163702 9398 - 241839+ Time paid for not worked (incl vacations and holidays) - 100783 - 137170 - 123771 33475 - 323249+

TOTAL LABOR - 2030089 - 1959604 - 3190341 - 344055 - 7524089

FUEL Price middot middot middot - 375791 - 375791 Consumption middot middot middot - 204910 - 204910

TOTAL FUEL middot middot middot middot - 580701 middot - 580701

ELECTRIC POWER middot bullbullbullbullbullbull to middot middot - 45674 middot - 45674

MATERIAL-Ocher than fuel Price + 106251 112344 - 1059 17453 234989 Quanticy - 1181388 - 900335 201128 34210 - 1846385

+ + + + +

TOTAL MATERIAL OTHER THAN FUEL - 1075137 - 787991 200069 51663 - 1611396+ + MISCELLANEOUS

Health and welfare benefits - 38735 - 60626 - 57909 - 15652 - 172922 Other miscellaneous - 624726 - 954691 - 405848 19015 - 1966250+

TOTAL MISCELLANEOUS - 663461 - 1015317 - 463757 3363 - 2139172+ TOTAL LABOR MATERIAL AND MISCELLANEOUS - 3768687 - 3762912 - 4080404 - 289029 - 11901032

DEPRECIATION + 74566 323399 middot + 397965+ middotRETIREMENTS - 44133 625422 middot + 581289+

TOTAL DEPRECIATION AND RETIREMENTS + 30433 948821 middot middot + 979254+ TOTAL RAfLWAY OPERATING EXPENSES - $3738254 - $2814091 - $4080404 289029 - $10921778-I $

RAILWAY OPERATING REVENUES EXPENSES TAXES AND INCOME BY MONTHS FOR THE YEAR ENDED DECEMBER 31 1960

1960

RAILWAY OPERATING REVENUES

RAILWAY OPERATING

EXPENSES

NET REVENUE FROM

RAILWAY OPERATIONS

RAILWAY TAX

ACCRUALS

RAILWAY OPERATING

INCOME

EQUIPMENT RENTS-NET

DR

JOINT FACILITY

RENTS-NET DR

NET RAILWAY OPERATING

INCOME

January $ 17336067 $ 15803272 $ 1532795 $ 1670000 $ (137205) $ 422175 S 231113 $ (790493) February 18493440 15151942 3341498 1673000 1668498 490735 234172 943591 March 19025746 15902966 3122780 1695000 1427780 686903 219282 521595 April bull 18042813 15280563 2762250 1684000 1078250 586443 251268 240539

May 18975935 16148830 2827105 1728000 1099105 824503 181449 93153 June 19011723 16297457 2714266 1727000 987266 803292 217671 (33697) July 18796482 15947748 2848734 1728000 1120734 823376 203289 94069 August 23377375 17022049 6355326 1806000 4549326 1420370 316997 2811959

September 20166066 15953895 4212171 1685000 2527171 1100653 248649 1177869 October 20925500 14736878 6188622 1647000 4541622 980838 252319 3308465 November 18549759 14797644 3752115 1620000 2132115 848876 267507 1015732 December 17661996 14886559 2775437 1474000 1301437 791725 238186 271526

Total $230362902 $187929803 $42433099 $20137000 $22296099 $9779889 $2861902 $9654308

( ) Denotes contra items 28

ANNUAL REPORT FOR 1960

REVENUE FREIGHT TRAFFIC STATISTICS-EXCLUDING TRUCK SERVICE

FREIGHT REVENUE AVERAGE

TONS TONSYEAR HAUL- PERCARRIED MILES PER

MILES TOTAL TON MILETON

(CENTS)

1951 51740580 16732323827 32339 $217832219 $421 1302 1952 49522089 16005309995 32320 222648097 450 1391 1953 46810989 15413226569 32927 215622726 461 1399 1954 43123214 14178678856 32879 197712105 458 1394 1955 45481060 95561748530 34216 205993029 453 1324

1956 45351213 15612344863 34425 209886542 463 1344 1957 42915573 14614118553 34025 212631339 495 1455 1958 40117213 13884510331 34610 205489920 512 1480 1959 40199394 14121939599 35130 201705278 502 1428 1960 38305568 13604642301 35516 189750236 495 1395

REVENUE PASSENGER STATISTICS-EXCLUDING BUS SERVICE

PASSENGER REVENUE AVERAGE

PASSENGERS PASSENGER DISTANCE PER YEAR

CARRIED MILES TRAVELED PER PASSENGER TOTAL

-MILES PASSENGER MILE (CENTS)

OTHER THAN COMMUTATION

1951 3341410 776958568 23252 $ 18484470 $553 2379 1952 3346346 739380708 22095 17569369 525 2376 1953 3158639 658842799 20858 15396026 487 2337 1954 3057733 599281006 19599 13582309 444 2266 1955 3003108 571128913 19018 12413340 413 2173

1956 3266663 696906549 21334 15758692 482 2261 1957 2943819 587947230 19972 14064509 478 2392 1958 2889740 549258597 19007 12969955 449 2361 1959 1839572 523514965 28459 12490275 679 2386 1960 1759253 515650913 29311 12095377 688 2346

CoMMUTATION

1951 4186842 94960045 2268 $ 1251058 $ 30 1317 1952 3899249 89299292 2290 1325955 34 1485 1953 3823231 88929041 2326 1316554 34 1480 1954 3920824 93543801 2386 1374494 35 1469 1955 4176751 98901556 2368 1463125 35 1479

1956 4150616 100135407 2413 1474073 36 1472 1957 4074228 98630820 2421 1463767 36 1484 1958 4338777 103055843 2375 1567002 36 1521 1959 5521115 123694172 2240 2818185 51 2278 1960 5036666 111139202 2207 3095340 61 2785

TOTAL

1951 7528252 871918613 11582 $ 19735528 $252 2263 1952 7245595 828680000 11437 18895324 261 2280 1953 6981870 747771840 10710 16712580 239 2235 1954 1955

6978557 7179859

692824807 670030469

9928 9332

14956803 13876465

214 193

2159 201

1956 7417279 797041956 10746 17232765 232 2162 1957 7018047 686578050 9783 15528276 221 2262 1958 1959 1960

7228517 7360687 6795919

652314440 647209137 626790115

9024 8793 9223

14536957 15308460 15190717

201 208 224

2229 2365 2424

BeglOnmg With year 1959 lOcludes cash fares single and round trip tickets sold for travel within suburban area which in prior yeaTS were included in Other than Commutation

29

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATISTICS OF OPERATIONS

TOTAL TRANSPORTATIONFREIGHT TRAINS PASSENGER TRAlNS SERVICE ITEMS I

1960 1959 1960 1959 1960 1959

RAlL-LINE Average miles of road operared 1 1deg--589_1---1deg586=_-------34-=68 -1-__394-=-9_1-----=10--597-1---I0-594=-

TRAlN MILES

Ordinary (wirh locomorives) 9554242 10152235 6185162 6740403 15739404 16892638 Ligh t (with locomotives) 1_----27--3-59_ 1__-----_24----42-=5_ 1_middot_-----=--------_1 __---c-_o---=-_ 1_--=-2~73-50-9_1_---2442-5_

Total (with locomotives) 9581601 10176660 6185162 6740403 15766763 16917063 Motor car trains bull middotICmiddotmiddotmiddotmiddot~ ----1----=----middotmiddot_1----------1~7-o1_=_60--1-____=_=65--4_8__7+--=-=-1-721-6_0-1-_________65_--487-

Total train miles 1_ __=9 0-58_1--6_deg 1 1__1deg 176--=66_deg--1 60-2_0_23_22_1 __68_0_5 89_deg_1 __15--7_83-923_1 __16--bull98_2-0-550_

LOCOMOTIVE MILES

Principal 9583849 10180397 6185162 6740403 15769011 16920800 Helper 81260 109822 286 726 81546 110548 Lig~t 104438 151874 35078 49266 139516 201140 TraIn sWItchIng 856137 864118 bull bull 856137 864118 Yard switching 1_ __=5-58757--2_1_--=-58---62-=-6-=48=_1 __~4--28-0-54__=31__--441--949-1 __60161_15_1 __630_4--59-=-7

Total locomotive miles 1-162213--2561----=-17-168859=_1---=6649-deg-=69=-1----723-234-4+2=2c862325_1_---=-24401203=_

CAR MILES

Loaded freight cars 431972870 466352092 517228 101495 432490098 466453587 Empty freigh tears I~26624=2gt490_127-=325-=-3~4~594-1------=--5==-- bull6471=-1------=-=-5o-6_01---266--248gt13--1_ 1-27-3gt5-35-154=-

Total loaded and empty freight cars 698215360 739886686 522869 102055 698738229 739988741 Caboose 1~_9285~9235-=-5-1-~1023=2-=-9-651=-1------=_1~--2101------=-~2~1~1=7--1-~9~86-0--5-6--5-1-=-1=_=0--33__1--7--68--

Total freight car miles 17deg8gtdeg742715-1-7502216233~7 1_----=524-079=-1_---=104172_ 1-7deg825982794=-1 _---750-320509=_

Passenger coaches 4913 3974 22864172 23715856 22869085 23719830 Sleeping and parlor cars (Company) 1812568 1817919 1812568 1817919 Sleeping cars (Pullman) 38383 35410 12685592 13337316 12723975 13372726 Club lounge dining and observation cars 547 bull 4989125 5250522 4989672 5250522 Combination passenger and head end cars 501995 659233 169149 142633 671144 801866 Mail express and baggage cars 2570197 2539863 21120653 22269656 23690850 24809519 Business cars 1---=--3-6~66-41--=-=---44---1-5 133-deg82_ 1_-----1--49-=-3deg8_ 1_--16-=-974-=6_1_-----_193---4657-_ 1_----shy

Total passenger car miles I~--=3215226~99-1-__=__3~282=63=__7_1-63-7--7--4~3--41_1--6-6-6-83-21--0+-66--9-2 65--847shy72deg4deg+-=-=-69--9--Grand total car miles 1 7_11 _227--4_1_4_1 753 498-974_1_6_429_84_2deg---1_6_67_8_7--=3_8_2_ 775 525--8--=34_ __8_2deg_2_86--bull356_

1 1

GROSS TON MILES

Locomotives and tenders (thousands) 1_ __=3-3942655-1 __3450-518--1__2--0_4_22_10---1 __21_6--2 1-13_ _---=5 436--865_ __5--612__=6311 1Freight cars contents and cabooses (thousands) 31409774 32603899 23551 4151 31433325 32608050 Passenger cars and contents (thousands) 1---1632517-1---------=-1670109=-1---41deg29-=-95_1--42999-8--4-1---4--26625o-12=-1------4=467o-O973=-

To tal freig ht and passenger (th0 usands) 1 31 57322-911_----32-- 771degdeg8=_1 41_265_46_ 1__4--=30_4 135_1 35--699--8__=37_ ____=_37-- 075_14__=3-shy1

TRAIN HOURS

Train hours in road service 473544 507565 137163 154436 610707 662001

REVENUE AND NONREVENUE FREIGHT TRAFFIC Tons of revenue freight ~8305568 40199394 Tons of nonrevenue freight middot1middotmiddotmiddot--- middotmiddot-=middot1middot---middotmiddotmiddotmiddot--- middotmiddot-1middotmiddot---middot---middotmiddotmiddot--- cl __ __ middot_middotmiddotmiddot1 _=-=-8421=-=35_ 1-------1_=_deg6--deg-53-7shy

Total tons of freight IC--- I~ +bull--- 1 --- ---1 392147-7deg3_1_---=-41=2-59093-1 Net ton miles revenue freight (thousands) 13604642 14121940 Net ton miles nonrevenue freight (thousands) middot1-middotmiddot--middot-middot=~-c- -1-------------middot1middotc----c_c I_____--_middot~middot-middotmiddotI_=-=---25797-5179c+----=-3_=_81c-0=-36--

Total net ton miles of freigh t (thousands) 1_c138530726=_1----=-145021~3=-301--104~35 _1 1646_1-1386421611----=-145deg2976

REVENUE PASSENGER TRAFFIC

Passengers carried 6795919 7360687 Passenger miles 626790115 647209137

MOTOR VEHICLE OPERATIONS EXCLUDED ABOVE Net ton miles revenue freight (thousands) 1124 1318 Passengers carried 995 1914 Passenger miles 1041447 991687

30

ANNUAL REPORT FOR 1960

STATISTICS OF OPERATIONS-CONCLUDED

-ITEMS 1960 1959 1958 1957 1956 1955

FREIGHT TRAIN STATISTICS AND AVERAGES

Gross ton miles trailing (thousands) 31573291 32771008 32413288 34236747 36203655 36228284

Eastbound 17124676 18176737 18125895 18805435 19734331 19787705 Westbound 14448615 14594271 14287393 15431312 16469324 16440579

Steam middot middot 135 133258 Dieselmiddotelectric 29107869 29901296 29705585 31129417 32597742 32536016 Electric 2465422 2869712 2707703 3107330 3605778 3559010

Per cent steam - middot 4 Per cent Dieselmiddotelectric 922 912 916 909 900 898 Per cent electric 78 88 84 91 100 98

Loaded freight cars per train 452 459 443 443 446 434 Empty freigh t cars per train 279 270 277 267 247 235

Total freight cars per train 731 729 720 710 693 669

Gross tons per train - 3305 3228 3157 3117 3070 2969 Net tons per train 1450 1428 1390 1373 1370 1323 Net tons per loaded car 321 311 313 310 307 305 Miles per car per day (serviceable freight) 393 390 357 370 387 377 Net ton miles per freight car-day 736 734 655 673 715 702 Train speed (train miles per train hour) 202 200 196 192 191 190 Gross ton miles (trailing) per train hour 66674 64565 61714 59780 58328 56315

PASSENGER TRAIN STATISTICS AND AVERAGES

Passenger car miles (excluding motor) - 64230016 66525240 69087808 75256765 86613202 72582117

Steam middot 13184 16967 Dieselmiddotelectric 64227781 66502614 65218200 71665998 81157901 66905429 Electric 2235 22626 3869608 3590767 5442117 5659721

Per cent steam middot Per cent Diesel-electric 1000 1000 944 952 937 922 Per cent electric middot 56 48 63 78

Cars per train (excluding motor) 1038 987 960 960 984 891 Revenue passengers per train 1012 952 898 865 894 812 Revenue passengers per car 166 165 161 160 168 175 Train speed (train miles per train hour) 452 441 444 439 447 429

YARD SWITCHINGSTATISTICS

Yard switching hours 1002686 1Oi0766 1063803 1184130 1251620 1274248

Steam middot 7 11279 Dieselmiddotelectric 994370 1038534 1056660 1174874 1235025 1246748 Electric 8316 12232 7143 9256 16588 16221

Per cent steam middot middot 9 Per cent Dieselmiddotelectric 992 988 993 992 987 978 Per cent electric 8 12 7 8 13 13

DENSITY STATISTICS

Per mile of road per day (freight service) Train miles ordinary Net ton miles

Per mile of road per day (passenger service) Train miles Car miles

25 3575

49 507

26 3753

47 463

27 3694

48 455

28 3896

47 450

30 4153

53 517

31 4161

48 425

31

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

REVENUE FREIGHT BY PRINCIPAL COMMODITIES-1960 AND 1959

INCREASE + OR1960 1959 DECREASE shyCOMMODITIES

TONS CARRIED

PERCENT OF TOTAL

TONS CARRIED

PERCENT OF TOTAL TONS PERCENT

PRODUCTS OF AGRICULTURE Wheat Corn Batley and tye Oats shy

Flour meal and mill products Citrus fruits Other fruits fresh and frozen

1708445 1325050

763672 347413

1275613 39049

123945

45 35 20

9 33

1

3

1653685 1281473

738948 298327

1242503 59289

135892

41 32 18 7

31 2 3

+ + + + + --

54760 43577 24724 49086 33110 20240 11947

33 34 33

165 27

341 88

Potatoes other than sweet 0 0 bull 229982 6 264312 7 - 34330 130 Other vegetables fresh and frozen Sugar beets Other products of agriculture

115520 213813

1588516

3

6 41

126388 191132

1480059

3

5 37

-+ +

10868 22681

108457

86 119

73 Total 7731018 202 7472008 186 + 259010 35

ANIMALS AND PRODUCTS Cattle calves sheep and goats 171861 4 198623 5 - 26762 135 Swine 21999 1 33892 1 - 11893 351 Fresh meats 386670 10 427610 10 - 40940 96 Poultry eggs butter and cheese 113551 3 128422 3 - 14871 116 Wool hides and leather 153604 4 161264 4 - 7660 47 Other animals and products 268968 7 265237 7 + 3731 14

Total 1116653 29 1215048 30 - 98395 81

PRODUCTS OF MINES Bituminous coal 4862060 127 5447866 136 - 585806 108 Coke 257305 6 296121 7 - 38816 131 Ores and concentrates Gravel and sand

462461 916755

12 24

385162 1166550

10 29

+ -

77299 249795

201 214

Stone broken ground or crushed Stone rough and finished Asphalt

1291164 77997

195521

34 2 5

1192897 71099

234070

30 2 6

+ + -

98267 6898

38549

82 97

165 Salt 148276 4 165384 4 - 17108 103 Other products of miles 1138894 30 1154731 28 - 15837 14

Total 9350433 244 10113880 252 - 763447 75

PRODUCTS OF FORESTS Logs posts poles and cordwood 1290191 34 1604736 40 - 314545 196 Pulpwood 1028793 27 966773 24 + 62020 64 Lumber and mill products 1845337 48 2434155 61 - 588818 242 Veneer and builtup wood 467827 12 520054 13 - 52227 100 Other products of forests 376413 10 259064 6 + 117349 453

Total 5008561 131 5784782 144 - 776221 134

MANUFACTURES AND MISCELLANEOUS Refined ~etroleum and products 1175165 31 1258601 31 - 83436 66 Sugar ta Ie syrups and molasses Iron and steellroducts

304542 2251993

8 59

293861 2299049

7 57

+ -

10681 47056

36 20

Machinery an boilers 222962 6 230072 6 - 7110 31 Cement Brick building tile and artificial stone

1242018 191608

32 5

1152635 199113

29 5

+ -

89383 7505

78 38

lime and plaster 73696 2 81785 2 - 8089 99 Agricultural implements traCtors and parts 155626 4 206217 5 - 50591 245 Autos trucks parts and tires Beverages

745090 599592

19 16

685152 613561

17 15

+ -

59938 13969

87 23

Ice 32950 1 31716 1 + 1234 39 Fertilizers Paper and paper products

590481 1191363

15 31

535770 1200754

13 30

+ -

54711 9391

102 8

Canned food Jroducts 985346 26 997315 25 - 11969 12 Scrap iron an scrap steel 598594 15 758925 19 - 160331 211 Building paper roofing and woodwork 434465 11 460040 12 - 25575 56 Other manufactures and miscellaneous 4165926 109 4435508 110 - 269582 61

Total 14961417 390 15440074 384 - 478657 31

GRAND TOTAL CARLOAD TRAFFIC 38168082 996 40025792 996 - 1857710 46

ALL lCl FREIGHT 137486 4 173602 4 - 36116 208

GRAND TOTAL CARLOAD AND lCi TRAFFIC 38305568 1000 40199394 1000 - 1893826 47

32

ANNUAL REPORT FOR 1960

NUMBER OF EMPLOYEES AND COMPENSATION

REGULAR EMPLOYEES TOTAL COMPENSATION ALL EMPLOYEES PART TIME

EMPLOYEES CHARGED ToAVERAGE CoMPENSATION

YEAR Noop

EMPLOYEES (MIDDLE

OP MONTH COUNT)

CoMPENSATION

AVERAGE COMPENSATION

PER EMPLOYEE

(NOT SUBJECT TO

CONTINUING AUTHORITY

OP RAILROAD)

TOTAL COMPENSATION OPERATING

EXPENSES

ADDITIONS AND

BETTERMENTS AND OTHER ACCOUNTS

1928 48129 $ 81744769 $1698 $135855 $ 81880624 $ 75548543 $ 6332081 1933 26493 39042823 1474 129469 39172292 36740362 2431930 1938 28988 52830262 1822 100092 52930354 48224635 4705719 1943 35377 90305409 2553 145093 90450502 84109945 6340557 1948 38268 138490345 3619 172016 138662361 126543269 12119092 1950 33668 128201025 3808 167342 128368367 121226784 7141583 1951 33846 143260363 4233 219693 143480056 134493624 8986432 1952 32550 145397263 4467 149515 145546778 138390501 7156277 1953 31138 138117562 4436 145500 138263062 131304863 6958199 1954 27961 126272397 4516 143400 126415797 120564532 5851265 1955 27936 126447937 4526 139330 126587267 120732130 5855137 1956 27408 134534522 4909 123452 134657974 126936601 7721373 1957 26007 133239878 5123 117455 133357333 125221025 8136308 1958 23402 128237334 5480 119269 128356603 123103272 5253331 1959 middotmiddot 22243 128292584 5767 107083 128399667 122031078 6368589 1960 20229 121037664 5983 98143 121135807 114993442 6142365

NUMBER OF EMPLOYEES AND COMPENSATION BY STATES

REGULAR EMPLOYEES PART TIME TOTAL

AVERAGE EMPLOYEES COMPENSATIONSTATE

AVERAGE TOTAL CoMPENSATION TOTAL ALL NUMBER COMPENSATION PER COMPENSATION EMPLOYEES

EMPLOYEE

Illinois bull 5977 $ 35954281 $6015 $18179 $ 35972460 Iowa 2062 12410458 6019 5105 12415563 Wisconsin bull 5272 30334008 5754 21200 30355208 Minnesota 2446 14392068 5884 8726 14400794

122 906621 7431 0 906621~~~~~fmiddotmiddotmiddotmiddotmiddot 346 2035311 5882 10780 2046091 Indiana 289 1726773 5975 9180 1735953 South Dakota 902 5244002 5814 180 5244182 North Dakota bullbull 98 524782 5355 2599 527381 Moncana bull 1060 6740641 6359 22074 6762715 Idaho 94 574143 6108 0 574143 Washington 1412 9145616 6477 120 9145736 All otherbullbullbullbullbull 149 1048960 7040 0 1048960

Total 20229 $121037664 $5983 $98143 $121135807

TOTAL PAYROLLS AND COMPANY CONTRIBUTIONS AVERAGE PER EMPLOYEE

COMPANY CoNTRIBUTIONS STRAIGHT TIME RATETOTAL AVERAGE

PAYROLLSshyYEAR RETIREMENT AND HEALTH AND TOTAL PER AVERAGE INCREGULAR

UNEMPLOYMENT WELPARE EMPLOYEE PER OVEREMPLOYEES TAXES BENEFITS HOUR 1939

1950 $128201025 $7234363 $135435388 $4023 $1580 1179 1951 143260363 7774582 151034945 4463 1754 1419 1952 145397263 7696578 153093841 4703 1852 1554 1953 138117562 7441326 145558888 4675 1895 1614 1954 126272397 7035232 133307629 4768 1945 1683 1955 126447937 7276300 $ 624381 134348618 4809 1959 1702 1956 134534522 8581092 1403449 144519063 5273 2130 1938 1957 133239878 8692650 2106181 144038709 5538 2290 2159 1958 128237334 8420346 1934613 138592293 5922 2465 2400 1959 128292584 9894538 1819163 140006285 6294 2566 2539 1960 121037664 9969699 1646241 132653604 6558 2638 2639

33

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

INVESTMENTS-DECEMBER 31 1960

EXTENT OF DESCRIPTION

NUMBER OF SHARES

CONTROL PER CENT

LEDGER AMOUNT

AFFILIATED COMPANIES WHOlly-OWNED SUBSIDIARIES

CAPITAL STOCKS Milwaukee Land Company A 5000 100 500000 The Milwaukee Motor Transportation Company A 500 100 50000

TOTAL CAPITAL STOCKS 550000 NOTE

Milwaukee Land Company A 100 2652000 ADVANCES

Milwaukee Land Company 100 905640 The Milwaukee Motor Transportation Company 100 1335353

TOTAL ADVANCES bullbull 1 ~2~24~0~9~9~3---TOTAL INVESTMENTS-WHOLLy-OWNED SUBSIDIARIES 5442993

JOINTLY-OWNED TERMINAL SWITCHING AND OTHER COMPANIES CAPITAL STOCKS

Chicago Terre Haute amp Southeastern Railway Company 4075505 5398 1 Chicago Union Station Company A 7000 25 7000 Davenport Rock Island amp North Western Railway Company A 15000 50 1750000 Des Moines Union Railway Company A 1000 50 100000 Des Moines Union Railway Company B 1000 50 26000 Indiana Harbor Belt Railroad Company A 15200 20 1520000 Kansas City Terminal Railway Company C 183333 8~ 183333 Minneapolis Eastern Railway Company A 625 50 15475 Packers Car Line Company 306 956 3060 Railway Express Agency Incorporated 26 26 2600 The Minnesota Transfer Railway Company A 913 11yg 91300 The Pullman Company 9426 128 348762 The St Paul Union Depot Company A 1036 12Y2 130475 Trailer Train Company 500 294 98860

TOTAL CAPITAL STOCKS 4276866 NOTE

Railway Express Agency Incorporated 26 751804 ADVANCES

Chicago Union Station Company 25 4786146 Davenport Rock Island amp North Western Railway Company 50 1292103 Des Moines Union Railway Company 50 855112 Kansas City Terminal Railway Company 8~ 647294 Packers Car Line Company 956 72464 The Minnesota Transfer Railway Company 11yg 353014 The St Paul Union Depot Company 12Y2 211073

TOTAL ADVANCES bull middot1 __--c~8~2~1~7L2~0~6c--_ TOTAL INVESTMENT-AFFILIATED COMPANIES 18688869

OTHER COMPANIES STOCKS

Miscellaneous 7676 DEBENTURES

Century 21 Exposition Inc 25000 NOTE

C H Lien Construction Company 1500 SALE AGREEMENTS

Best Built Company 35750 CargiIl Incorporated 390000 General Warehouse amp Transportation Company 24000 J K Fiddes 59200 J Lentin Lumber Company 39900 Monarch Warehouses Incorporated 27360 Steven] Kipper Jr 34039 Thisted Motor Company 11520 Other companies and individuals 14656

TOTAL SALE AGREEMENTS 636425 TOTAL INVESTMENT-OTHER COMPANIES

TOTAL INVESTMENTS

670601 $19359470

I--------=-=-=c--=-=--shy

A-Pledged under Chicago Milwaukee Sc Paul and Pacific Railroad Company First Mortgage except Directors qualifying shares B-Deposited with IowamiddotDes Moines National Bank Des Moines Iowa under Stock Trust Agreement dated June 14 1948 and pledged

under the First Mortgage C-Deposited with First National Bank of Kansas City Mo under Stock Trust Agreement dated June 12 1909 and pledged under the

First Mortgage except Directors qualifying shares

20

ANNUAL REPORT FOR 1960

INVESTMENT IN PROPERTIES

ACCOUNT BALANCE AT JANUARY 1

EXPENDITURES DURING THE YEAR

CREDITS FOR PROPERTY RETIRED DURING THE YEAR

BALANCE AT DECEMBER 31

J

ROAD Engineering Land for transportation purposes Other right-of-way expenditures Grading Tunnels and subways Bridges trestles and culverts Ties Rails Other track material Ballast Track laying and surfacing Fences snowsheds and signs Station and office buildings Roadway buildings Water stations Fuel stations Shops and enginehouses Storage warehouses Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous structures Roadway machines Roadway small tools Public improvements-Construction Other expenditures-Road Shop machinery Power-plant machinery

$ 19526006 39048637

381312 143144397

9833072 76929583 34650264 68850190 47424085 26425043 33120819

5401156 26590033

2113899 1091355

746608 19544030

64349 1607522 6300222

21437281 1612483 9737209

673072 8486729

321671 14661137

335 7212584 5500804

$ 80269 $ 47281 105987 319878 77192

258951 255767 114819 42593

1013757 304057 116894 47625 251013 51045 471429 50791

90866 25183 196827 57265

13843 2672 450470 826144

7026 37792 15021 69162

3325 173 537467 38753

29057 58332

564767 157799 360010 104017

612 13590 5060

79 5656 588388 61627

1042 270 232514 59940

422650 96923

3149 20334

$ 19558994 38834746

458504 143147581

9905298 77639283 34719533 69050158 47844723 26490726 33260381

5412327 26214359

2083133 1037214

749760 20042744

64349 1578247 6707190

21693274 1611871 9745739

667495 9013490

322443 14833711

335 7538311 5483619

TOTAL ROAD 632435887 6020402 2746751 635709538

EQUIPMENT Locomotives Freight-train cars Passenger-train cars Floating equipment Work equipment Miscellaneous equipment

124658042 169559340

31348424 278731

6893714 2333999

248407 598587 13410931 6445607

237485

91258 221157

216303 162850

124307862 176524664

31110939 278731

6763815 2387452

TOTAL EQUIPMENT 335072250 13966899 7665686 341373463

GENERAL EXPENDITURES 38292664 260 84367 38208557

r IMPROVEMENTS ON LEASED PROPERTY 618871 270 619141

TOTAL OPERATING PROPERTIES 1006419672 19987831 10496804 1015910699

MISCELLANEOUS PHYSICAL PROPERTY Non-operating property Track material loaned

7007150 206040

102359 6922

141991 7926

6967518 205036

TOTAL MISCELLANEOUS PHYSICAL PROPERTY 7213190 109281 149917 7172554

TOTAL PROPERTIES BEFORE RECORDED DEPRECIATION $1013632862 $ 20097112 I $ 10646721 $ 1023083253

21

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

CONTINGENT LIABILITIES WITH RESPECT TO SECURITIES OF OTHER COMPANIES AS OF DECEMBER 31 1960

ITEMS AMOUNT

CHICAGO UNION STATION COMPANY 1 First Mortgage Bonds 3Ya Series F due July 1 1963 $ 13718000 2 First Mortgage Bonds 2Ys Series G due July 1 1963 34030000 3 Note 5ri due September 1 1961 2500000

50248000 Principal and interesr guaranteed jointly and severally by the Railroad Com~any and 3 other proprietors at time of issue The

Railroad Company with other proprietors has agreed that gross rental to e paid bJ them for use of Chicago Union Station faciliries shall include a sum sufficient ro pay interest on all of these securiries an the payment into the Retirement Fund for First Mortgage bonds beginning in 1955 and to advance amounts requited to pay at maturity ptincipal of Item 3

INDIANA HARBOR BELT RAILROAD COMPANY 1 First Mortgage Bonds 5Ya due June I 1982 7235000 2 Equipment Trust Certificates 2 due annually Segtember 15 1961 to September 15 1964 772000 3 Equipment Trust Certificates 2ri due annually Fe ruary 15 1961 to February 15 1965 600000

8607000 Principal and interest on the 5Ya Bonds is guaranteed jointly and severally by the Railroad Company and 3 other proprietors

The Railroad Company and other proprietors severally guarantee in proportion to their stock holdings the payment by the Belt Railroad of the principal of and dividends on equipment obligations Items 2 and 3

KANSAS CITY TERMINAL RAILWAY COMPANY 1 First Mortgage Serial Bonds due annually October 1 1961 to October I 1974 38602000

Under a certain operating agreement the Railroad Company and 11 other proprietors are obligated to pay to the Terminal Company or in case of default to the Mortgage Trustee in equal shares the principal of these bonds as they mature in the nature of nonmiddot interest bearing advances and interest thereon as rental

PACKERS CAR LINE COMPANY Conditional Sale Agreements 298272

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-956

THE MINNESOTA TRANSFER RAILWAY COMPANY 1 3yeni Sinking Fund Promissory Notes dueJune 11976 1461600

Under provisions of the bymiddotlaws of the Transfer Co the Railroad Company and 8 other proprietors are required to conmiddot tribute on an ownership basis to (a) an annual sinking fund for these Notes equal to $41412 payable on or before May 20 of each year and (b) semimiddotannual installments of interest on the Notes

THE ST PAUL UNION DEPOT COMPANY 1 First and Refunding Mortgage Bonds 3Ya Series B due October I 1971 10891000

Guaranteed jointly and severally by the Railroad Company and 7 other proprietors each of which is also obligated to advance its ownership proportion of amounts required for Sinking Fund payments and to pay its proportion based upon use of the interest on the bonds

TRAILER TRAIN COMPANY Conditional Sale Agreements 1736741

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-294

TOTAL $111844613

22

ANNUAL REPORT FOR 1960

LONG-TERM DEBT DECEMBER 31 1960

DESCRIPTION DATE OF

ISSUE DATE OF

MATURITY

AMOUNT ORIGINALLY

ISSUED OR ASSUMED

AMOUNT AS OF

DBc 31 1960

AMOUNT HELD BY COMPANY

AMOUNT ACTUALLY

OUTSTANDING RATE PER

CENT

INTEREST

PAYABLB ACCRUED DURING

YBAR First mongage bonds Series A General mortgage income bonds

Series A General mortgage convertible inmiddot

come bonds Series B Five per cent income debentures

Series A The Bedford Belt Ry Co Grsr

mongage bonds The Southern Indiana Ry Co first

mongage bonds Chicago Terre Haute and 5ourbmiddot

eastern Ry Co Firsr and refunding mortgage

bonds Income mortgage bonds

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

I 1944

11944

11944

11955

11946

11946

I 1946 I 1946

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

11994

12019

12044

12055

11994

I 1994

11994 I 1994

$ 59515100

57256600

51422100

60000000

350000

7287000

9571000 6335800

$ 53784300

33905200

34640400

58500000

333000

7236000

9571000 6335800

$ 346300

408500

733100

300000

144000

256000

2051000 1597000

$ 53438000

33496700

33907300

58200000

189000

6980000

7520000 4738800

4

41

41

5

4~

44

4~ 4~

J amp J

April

April

MampS

JA amp J

JA amp J

JA amp J JA amp J

$ 2145645

1513512

1534381

2903400

7961

296938

320161 201133

Eb~ro~)nt obl~gati~~~ ~~ederails 163723218 75220900 75220900 2884166 Totallongmiddotterm debe $415460818 $279526600 $ 5835900 $273690700 $11807297

$100000 pledged undet ChIcago Terre Haute and Southeastern RaIlway Company Fust and refundmg mongage $1515000 pledged under Chicago Milwaukee St Paul and Pacific Railroad Company First mongage

EQUIPMENT OBLIGATIONS DECEMBER 31 1960

INTBRESTDATB OF DATB OF ORIGINAl AMOUNT AMOUNT PRINCIFAL

DESCRIPTION LBASE OR FINAL COST OF ORIGINALLY OUTSTANDING PAYABLB RATE ACCRUBD AGREEMENT MATURITY EQUIPMENT ISSUED DBc 31 1960 DURING 1961 PER PAYABLB DURING

CENT YEARI EQUIPMENT TRUST CERTIFICATES Series HH Apr 11949 Apr 11964 $ 8112742 $ 6060000 $ 1414000 $ 404000 2Ji AampO $ 37260 Series JJ Sept I 1949 Sept 1 1964 7604384 5640000 1504000 376000 2li MampS 34846 Series KK Oct I 1949 Oct 11964 ~026868 4500000 1200000 300000 2~ AampO 30375 Series LL June I 1950 June 1 1965 289514 4650000 1395000 310000 24 J amp D 36038 Series MM Nov 11950 Nov I 1965 7251863 5430000 1810000 362000 2n MampN 48554 Series NN June I 1951 June I 1961 7254678 5300000 265000 265000 2Ya JampD 17776 Series 00 OCt I 1951 Oct 11966 10053530 7500000 3000000 500000 2Ya AampO 93437 Seties PP bull Mar 11952 Mar 11967 3215855 2400000 1040000 160000 2Ya MampS 31817 Series QQ Sept I 1952 Sept 1 1967 5441323 3990000 1862000 266000 3Va MampS 61651 Series RR Jan I 1954 Jan 11969 10379112 7650000 4335000 510000 3Va J ampJ 139454 Series SS July 11954 July 11969 9931620 7800000 4680000 520000 24 J ampJ 132275 Series TT Nov 1 1954 Nov I 1969 9141903 7200000 4320000 480000 2Ya MampN 132250 Series UU Jan 11956 Jan 11971 9655380 7500000 5250000 500000 3raquo J amp J 181407 Series VV (1st Install) Feb I 1957 Feb 11972 3000000 2300000 200000 4 FampA 94667 11745718 Series VV (2nd InSltaII) Feb I 1957 Feb I 1972 6000000 4600000 400000 4Vs F ampA 207084 Series WW Jan 11958 Jan 11973 6814810 5400000 4500000 360000 4gtil J amp J 189338 Series XX Feb I 1959 Feb 11974 7419495 5850000 5265000 390000 41 FampA 242775Series YY (1st Install) Feb I 1960 Feb I 1975 3000000 2900000 200000 4Ya FampA 121878 Series YY (2nd Install) Feb 11960 Feb I 1975 9683950 4650000 4495000 310000 4~ FampA 128844 CONDITIONAL SALE AGREEMENTS

The FitS( National Bank of Chimiddot ca~o Assignee of the Sellers

Paci c Car amp Foundty Co May I 1956 Nov I 1964 1843205 1428400 731357 182916 395 FMAampN 32094First Wisconsin Narional Bank of

Milwaukee and Northwestmiddot ern National Bank of Minneshyapolis Assignees of tbe SeUers

General Motors Corpn (Electro-Motive Div) Feb 25 1953 May 11961 1543977 1155000 80558 80558 3 FMAampN 4594

Fairbanks Motse amp Co July 15 1953 Nov 1 1961 531102 396000 54830 54830 3 FMAampN 2380American Locomotive Co July 15 1953 Nov 1 1961 529935 396000 54830 54830 3 FMAampN 2380Baldwin-LimamiddotHamilton

Corporation July 15 1953 Nov 1 1961 357568 264000 36553 36553 3 FMAampN 1587Seattle-Fitst National Bank Asmiddot

Bai1i~e_~i~Sfa~il~~n Corporation SePt I 1953 Nov 1 1961 357568 264000 36979 36979 335 FMAampN 1791

General Motors Cotpn (Electro-Motive Div) Sept I 1953 Nov 1 1961 1670914 1236000 173128 173128 335 FMAampN 8385

American Locomotive Co Sept I 1953 Feb 11962 529935 396000 69048 55008 335 FMAampN 3135Continental Illinois National Bank

and Ttust Company of Chishycago Assignee of tbe SeUers

Pullman-Srandard Car Manumiddot facturing Co May 11958 Nov I 1973 4920125 4920125 4245616 328008 440 MampN 195836

General American Transpotta tion Corporation May I 1958 Nov I 1973 6165438 6165438 5296389 411029 440 MampN 244862

United States Railway Equipment Co May 11958 Nov 1 1973 570706 570706 494612 38047 440 MampN 22740

General Motors Cotpn Jan 15 1959 Mar I 1974 8680000 8680000 7812000 578666 5 MampS 402656 Total equipment obligations $163723218 $129391669 $75220900 $ 8843)52 $ 2884166

PAYMENTS MATURING IN YEARS ENDING December 31 1961 $ 8843552 December 31 1966 $ 6151751 December 311971 $ 3465751December 31 1962 8108041 December 31 1967 5571751 December 311972 291751December 311963 8101627 December 31 1968 )225751 Decembet 31 1973 bull 2370271Decembet 31 1964 bull 7862066 December 31 1969 4970751 Decembet 31 1974 994335December 311965 6668751 December 31 1970 3715751 December 311975 _ 255000

Total $75220900

23

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

MILES OF ROAD BY STATES DECEMBER 31 1960

ROAD OPERATED

STATE OWNED SOLELY OWNED JOINTLY TRACKAGELEASED TOTALMAIN BRANCH MAIN BRANCH RIGHTS

LiNE LINE LINE LINE

Idaho 11276 11083 9middot11 23270 Illinois 43296 11755 240 14 13231 68536 Indiana 15591 3679 19270 Iowa 119993 51468 08 04 10 6706 178189 Kansas 705 705

Michigan 5782 11978 25 583 18368 Minnesota 75531 35154 503 2270 19410 132868 Missouri 13002 944 1651 15597 Montana 74753 47322 2999 46 125120 Nebraska 562 562

North Dakota 10250 26329 110 36689 South Dakota 104314 69528 173842

31469 47426 2688 5000 20110 106693i~~~~J~n 103928 47228 1634 7051 159841

Total 609185 362950 4383 12056 10 70966 1059550

Includes 97 mile owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contraCt

MILES OF TRACK DECEMBER 31 1960

OWNED OWNED TRACKAGEITEMS LEASED TOTALSOLELY JOINTLY RIGHTS

Miles of Road (First Main Track) Operated 972135 16439 10 70966 1059550 Not operated 362 362

Additional Main Tracks Operated 69332 1424 41 31329 102126 Not operated

Yard Tracks and Sidings Operated 321153 25542 219 47997 394911 Not operated 228 2626 2854

I-----f------f-----middotI-----I----shyTotal operated 1362620 43405 270 150292 1556587

Total not operated 590 2626 3216 I-----f-----Imiddot-----I-----I----shy

Grand Total 1363210 46031 270 150292 1559803

Miles of Road operated includes 97 mile Yard Tracks and Sidings operated includes 124 miles owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contract

24

ill ~ It

I I I i I I I bull II III

ANNUAL REPORT FOR 1960

DETAILED STATEMENT OF RAILWAY OPERATING REVENUES AND EXPENSES

RAILWAY OPERATING REVENUES

1960 1959 INCREASE DECREASE TRANSPORTATION

Freight $189560907 $201536333 middot0 $ 11975426 Passenger 15174969 15282171 107202 Baggage 79806 86066 middot 6260 Parlor and chair car 83476 91957 8481 Mail 9418410 8862116 $ 556294 Express 3030579 3180656 150077 Other passenger-crain 107746 100303 7443 Milk 18260 30216 middot 11956 Switching 5979910 6591066 611156

1------1------1-------1------shyTOTAL TRANSPORTATION REVENUE 223454063 235760884 12306821

INCIDENTAL

Dining and buffet 1521218 1527536 6318 Station crain and boat privileges 57552 56068 1484 Storage-Freight 8015 11196 - 3181 Storage-Baggage 3631 3837 - 206 Demurrage 1240131 1248537 8406 Communication 55650 72541 16891 Rents of buildings and other property 257841 246697 11144 Miscellaneous 461149 507969 middot middot0 46820

TOTAL INCIDENTAL OPERATING REVENUE 3605187 3674381 69194

JOINT FACILITY

Joint facility-Credit 3315646 2620693 694953 Joint facility-Debit (11994) (14133) (2139)

TOTAL JOINT FACILITY OPERATING REVENUE 3303652 2606560 697092

TOTAL RAILWAY OPERATING REVENUE $230362902 $242041825 $ 11678923

( ) Denotes concra items

RAILWAY OPERATING EXPENSES

1960 1959 INCREASE DECREASE MAINTENANCE OF WAY AND STRUCTURES

Superincendence $ 3108012 $ 3388761 $ 280749 Roadway maincenance 2861659 2867371 5712 Tunnels and subways 10889 11354 465 Bridges trestles and culverts 986082 1198575 212493 Ties 1793766 1827106 33340 Rails 592902 894914 302012 Other track material 1336407 1996881 660474 Ballast 217365 408471 middot 191106 Track laying and surfacing Fences snowsheds and signs

6515560 319315

7505265 398716

989705 79401

Station and office buildings 828484 1014046 185562 Roadway buildings 55448 86514 31066 Water stations Fuel stations

12115 26908

21831 16802 $ 10106

9716

Shops and enginehouses 574222 542976 31246

25

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

RAILWAY a PERATING REVENUES AND EXPENSES- CONTINUED RAILWAY OPERATING EXPENSES-CONTINUED

MAINTENANCE OF WAY AND STRUCTURES

Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous StruCtures Road property-Depreciation _ Retiremenes- Road Roadway machines _ Dismantling retired road property Small cools and supplies Removing snow ice and sand Public improvemenes-Maintenance Injuries co persons Insurance Stationery and printing Other expenses Right-of-way expenses Maineaining joint cracks yards and other facilities-Debit Maintaining joint tracks yards and other facilities-Credit

TOTAL MAINTENANCE OF WAY AND STRUCTURES

MAINTENANCE OF EQUIPMENT

Superintendence Shop machinery Power-plant machinery Shop and powerplant machinery-Depreciation Dismantling retired shop and powermiddotplane machinery Other locomotives-Repairs Freight-train cars-Repairs Passenger-train cars-Repairs Work equipment-Repairs Miscellaneous equipment-Repairs Dismantling retired equipment Retirements-Equipment Equipmene- Depreciation Inj uries to persons Insurance Stationery and printing Other expenses Taint maintenance of equipment expenses-Debit Taint maineenance of equipmene expenses-Credit

TOTAL MAINTENANCE OF EQUIPMENT

TRAFFIC

Superintendence Outside agencies Advertising Traffic associations Industrial and immigration bureaus Insurance Stationery and printing Other expenses

1960 1959 INCREASE DECREASE

$ 56714 $ 36447 $ 20267 bullbullbullbullbullbullbull _0 bullbullbullbullbullbull

935578 909129 26449 bullbull 0 bullbullbullbullbullbullbull 0 bullbullbullbullbull

bullbullbullbullbullbull 0 bullbullbullbullbullbull bull bullbull 1838913 1653168 185745 31898 33384 $ 1486 301492 355954 54462 9685 11190 middot 1505 5028247 4953681 74566 197350 241483 44133 706168 892299 186131 107360 148842 middot 41482 780012 825073 45061 841898 1093119 251221 736255 713553 22702 0 326277 442052 115775 50816 46225 4591 71268 87971 16703 419344 470012 50668bull bullbull 0 bullbullbullbullbullbullbullbullbullbull

43266 45762 2496

2725332 2842160 middot 116828

(755037) (550863) (204174) 1------1------1-------1------shy

33691970 37430224 3738254

1716762 1720882 41200 bullbullbullbullbullbullbullbullbullbullbullbullbullbullbull

521695 506499 15196

133941 153222 19281

284088 285333 1245

3681 856 2825

12448450 13197294 748844

9119749 10867539 1747790

2844061 3581261 737200

249163 301007 middot 51844

196990 196551 439

110983 91095 19888

(139163) (764585) (625422)

10468468 10143824 324644

245956 297309 51353

66754 68018 1264

42632 59005 16373

477426 563338 85912

292109 629586 337477

( 35052) (35250) (198)

39048693 41862784 2814091

1853253 1775877 77376

3420570 3680896 260326

641695 669595 27900

316941 281954 34987

50793 58011 7218

991 875 116

267539 246898 20641

29672 34959 5287 1------1------1middot------1------shy

TOTAL TRAFFIC EXPENSES $ 6581454 $ 6749065 $ 167611

( ) Denotes contra items

26

ANNUAL REPORT FOR 1960

RAILWAY OPERATING REVENUES AND EXPENSES-CONCLUDED

RAILWAY OPERATING EXPENSES-CONCLUDED

1960 1959 INCREASE DECREASE TRANSPORTATION

Superintendence $ 2981453 S 2814960 $166493 Dispatching trains 737390 807806 $ 70416 Station employees 12568811 13277513 708702 Weighing inspection and demurrage bureaus 307278 325534 bullbullbullbullbullbull 0 bullbullbullbullbullbullbullbullbull 18256 Station supplies and expenses 1091896 1140062 bullbull 0 bullbullbull 0 bullbullbullbullbullbull 0 bullbull 48166 Yardmasters and yard clerks 3991133 4119498 bullbullbullbullbullbull 0 bullbullbullbullbullbull 0 bullbull 128365 Yard conductors and brakemen 9303622 9647318 343696 Yard swirch and signal tenders 730410 755025 24615 Yard enginemen 6155278 6362440 207162 Yard switching fuel 923737 988987 65250 Yard switching power purchased 11946 15258 bullbull 0 bullbullbullbullbullbullbullbullbullbullbullbullbull 3312 Water for yard locomotives 17360 19948 2588 Lubricants for yard locomotives 83523 109472 25949 Other supplies for yard locomotives Enginehouse expenses-Yard

49721 498339

48817 542983

904

44644

Yard supplies and expenses Operating joint yards and terminals-Debit Operatin~ joint yards and terminals-Credit Train engInemen Train fuel Train power purchased Water for train locomotives

466959 5790981 (683719)

9533667 7243332

864933 94310

441246 5978628 (685475)

9966568 7758783

907295 105164

25713 middot bull bullbull 0 bullbullbullbullbullbullbullbullbullbull 0

middot

187647

(1756) 432901 515451 42362 10854

Lubricants for train locomotives 795622 938600 142978 Other supplies for train locomotives Enginehouse expenses-Train Trainmen

210707 1124921

12091384

202708 1222756

12613963

7999 bullbullbullbull 0 bullbullbullbullbullbullbull bullbullbullbull

97835

522579 Train supplies and expenses 6340264 6660876 320612 Operating sleeping cars 715113 526531 188582 Signal and interlcker operation CrOSSIng protectIOn

1049887

721750 1037947

806370 11940

middot

84620 Drawbridge operation 215086 258082 42996 Communication system operation 1060497 1081772 21275 Operating Boating equipment 11796 10985 811 Srationery and printing 412827 392820 20007 Other expenses 817489 848149 30660 Operating joint tracks and facilities-Debit 1170056 1311393 141337 Operating joint tracks and faciliries-Credir Insurance

(786053)

78437 (751937)

92514 (34116)

14077 Clearing wrecks Damage to property

265853 120728

230128 206210

35725

85482

Damage to live stock on right-of-way Loss and damage-Freight

80817

2795442 53816

2942960 27001

147518 Loss and damage-Baggage 5528 722 4806 Injuries to persons 1708733 1714453 5720

TOTAL TRANSPORTATION EXPENSES 93769244 97849648 4080404

MISCELLANEOUS OPERATIONS Dining and buffet service 2855845 2888241 32396 Operaring joint miscellaneous facilities-Debit 149757 207418 57661

J------J------I-------I------shyTOTAL MISCELLANEOUS OPERATIONS 3005602 3095659 90057

GENBRAL Salaries and expenses of general officers 1421416 1331832 89584 Salaries and expenses of clerks and attendants 6821635 6920559 98924 General office supplies and expenses 753564 727092 26472 Law expenses 831662 811940 19722 Insurance 33708 6002 27706 Pensions and gratuities 818190 917286 99096 Stationery and priming 348137 336267 11870 Valuation expenses 53068 59453 6385 Other expenses 501292 520844 19552 General joint faciliries-Debit 258783 241859 16924 General joint faciliries-Credit (8615) (8933) (318)

TOTAL GENERAL EXPENSES 11832840 11864201 middot 31361

GRAND TOTAL RAILWAY OPERATING EXPENSES $187929803 $198851581 $10921778

( ) Denotes contra items

27

bullbullbull

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

ANALYSIS OF INCREASES AND DECREASES IN TOTAL RAILWAY OPERATING EXPENSES 1960 COMPARED WITH 1959

MAINTENANCE MAINTENANCE TRANSshyITEMS OF WAY AND OP ALL OTHER TOTALPORTATIONSTRUCTURES EQUIPMENT

LABOR General wage increases + $ 360933 + $ 323486 + $1370434 + $ 289045 + $ 2343898 Straight time worked - 2213317 - 2135307 - 4273302 - 680973 - 9302899 Overtime worked - 76922 - 10613 - 163702 9398 - 241839+ Time paid for not worked (incl vacations and holidays) - 100783 - 137170 - 123771 33475 - 323249+

TOTAL LABOR - 2030089 - 1959604 - 3190341 - 344055 - 7524089

FUEL Price middot middot middot - 375791 - 375791 Consumption middot middot middot - 204910 - 204910

TOTAL FUEL middot middot middot middot - 580701 middot - 580701

ELECTRIC POWER middot bullbullbullbullbullbull to middot middot - 45674 middot - 45674

MATERIAL-Ocher than fuel Price + 106251 112344 - 1059 17453 234989 Quanticy - 1181388 - 900335 201128 34210 - 1846385

+ + + + +

TOTAL MATERIAL OTHER THAN FUEL - 1075137 - 787991 200069 51663 - 1611396+ + MISCELLANEOUS

Health and welfare benefits - 38735 - 60626 - 57909 - 15652 - 172922 Other miscellaneous - 624726 - 954691 - 405848 19015 - 1966250+

TOTAL MISCELLANEOUS - 663461 - 1015317 - 463757 3363 - 2139172+ TOTAL LABOR MATERIAL AND MISCELLANEOUS - 3768687 - 3762912 - 4080404 - 289029 - 11901032

DEPRECIATION + 74566 323399 middot + 397965+ middotRETIREMENTS - 44133 625422 middot + 581289+

TOTAL DEPRECIATION AND RETIREMENTS + 30433 948821 middot middot + 979254+ TOTAL RAfLWAY OPERATING EXPENSES - $3738254 - $2814091 - $4080404 289029 - $10921778-I $

RAILWAY OPERATING REVENUES EXPENSES TAXES AND INCOME BY MONTHS FOR THE YEAR ENDED DECEMBER 31 1960

1960

RAILWAY OPERATING REVENUES

RAILWAY OPERATING

EXPENSES

NET REVENUE FROM

RAILWAY OPERATIONS

RAILWAY TAX

ACCRUALS

RAILWAY OPERATING

INCOME

EQUIPMENT RENTS-NET

DR

JOINT FACILITY

RENTS-NET DR

NET RAILWAY OPERATING

INCOME

January $ 17336067 $ 15803272 $ 1532795 $ 1670000 $ (137205) $ 422175 S 231113 $ (790493) February 18493440 15151942 3341498 1673000 1668498 490735 234172 943591 March 19025746 15902966 3122780 1695000 1427780 686903 219282 521595 April bull 18042813 15280563 2762250 1684000 1078250 586443 251268 240539

May 18975935 16148830 2827105 1728000 1099105 824503 181449 93153 June 19011723 16297457 2714266 1727000 987266 803292 217671 (33697) July 18796482 15947748 2848734 1728000 1120734 823376 203289 94069 August 23377375 17022049 6355326 1806000 4549326 1420370 316997 2811959

September 20166066 15953895 4212171 1685000 2527171 1100653 248649 1177869 October 20925500 14736878 6188622 1647000 4541622 980838 252319 3308465 November 18549759 14797644 3752115 1620000 2132115 848876 267507 1015732 December 17661996 14886559 2775437 1474000 1301437 791725 238186 271526

Total $230362902 $187929803 $42433099 $20137000 $22296099 $9779889 $2861902 $9654308

( ) Denotes contra items 28

ANNUAL REPORT FOR 1960

REVENUE FREIGHT TRAFFIC STATISTICS-EXCLUDING TRUCK SERVICE

FREIGHT REVENUE AVERAGE

TONS TONSYEAR HAUL- PERCARRIED MILES PER

MILES TOTAL TON MILETON

(CENTS)

1951 51740580 16732323827 32339 $217832219 $421 1302 1952 49522089 16005309995 32320 222648097 450 1391 1953 46810989 15413226569 32927 215622726 461 1399 1954 43123214 14178678856 32879 197712105 458 1394 1955 45481060 95561748530 34216 205993029 453 1324

1956 45351213 15612344863 34425 209886542 463 1344 1957 42915573 14614118553 34025 212631339 495 1455 1958 40117213 13884510331 34610 205489920 512 1480 1959 40199394 14121939599 35130 201705278 502 1428 1960 38305568 13604642301 35516 189750236 495 1395

REVENUE PASSENGER STATISTICS-EXCLUDING BUS SERVICE

PASSENGER REVENUE AVERAGE

PASSENGERS PASSENGER DISTANCE PER YEAR

CARRIED MILES TRAVELED PER PASSENGER TOTAL

-MILES PASSENGER MILE (CENTS)

OTHER THAN COMMUTATION

1951 3341410 776958568 23252 $ 18484470 $553 2379 1952 3346346 739380708 22095 17569369 525 2376 1953 3158639 658842799 20858 15396026 487 2337 1954 3057733 599281006 19599 13582309 444 2266 1955 3003108 571128913 19018 12413340 413 2173

1956 3266663 696906549 21334 15758692 482 2261 1957 2943819 587947230 19972 14064509 478 2392 1958 2889740 549258597 19007 12969955 449 2361 1959 1839572 523514965 28459 12490275 679 2386 1960 1759253 515650913 29311 12095377 688 2346

CoMMUTATION

1951 4186842 94960045 2268 $ 1251058 $ 30 1317 1952 3899249 89299292 2290 1325955 34 1485 1953 3823231 88929041 2326 1316554 34 1480 1954 3920824 93543801 2386 1374494 35 1469 1955 4176751 98901556 2368 1463125 35 1479

1956 4150616 100135407 2413 1474073 36 1472 1957 4074228 98630820 2421 1463767 36 1484 1958 4338777 103055843 2375 1567002 36 1521 1959 5521115 123694172 2240 2818185 51 2278 1960 5036666 111139202 2207 3095340 61 2785

TOTAL

1951 7528252 871918613 11582 $ 19735528 $252 2263 1952 7245595 828680000 11437 18895324 261 2280 1953 6981870 747771840 10710 16712580 239 2235 1954 1955

6978557 7179859

692824807 670030469

9928 9332

14956803 13876465

214 193

2159 201

1956 7417279 797041956 10746 17232765 232 2162 1957 7018047 686578050 9783 15528276 221 2262 1958 1959 1960

7228517 7360687 6795919

652314440 647209137 626790115

9024 8793 9223

14536957 15308460 15190717

201 208 224

2229 2365 2424

BeglOnmg With year 1959 lOcludes cash fares single and round trip tickets sold for travel within suburban area which in prior yeaTS were included in Other than Commutation

29

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATISTICS OF OPERATIONS

TOTAL TRANSPORTATIONFREIGHT TRAINS PASSENGER TRAlNS SERVICE ITEMS I

1960 1959 1960 1959 1960 1959

RAlL-LINE Average miles of road operared 1 1deg--589_1---1deg586=_-------34-=68 -1-__394-=-9_1-----=10--597-1---I0-594=-

TRAlN MILES

Ordinary (wirh locomorives) 9554242 10152235 6185162 6740403 15739404 16892638 Ligh t (with locomotives) 1_----27--3-59_ 1__-----_24----42-=5_ 1_middot_-----=--------_1 __---c-_o---=-_ 1_--=-2~73-50-9_1_---2442-5_

Total (with locomotives) 9581601 10176660 6185162 6740403 15766763 16917063 Motor car trains bull middotICmiddotmiddotmiddotmiddot~ ----1----=----middotmiddot_1----------1~7-o1_=_60--1-____=_=65--4_8__7+--=-=-1-721-6_0-1-_________65_--487-

Total train miles 1_ __=9 0-58_1--6_deg 1 1__1deg 176--=66_deg--1 60-2_0_23_22_1 __68_0_5 89_deg_1 __15--7_83-923_1 __16--bull98_2-0-550_

LOCOMOTIVE MILES

Principal 9583849 10180397 6185162 6740403 15769011 16920800 Helper 81260 109822 286 726 81546 110548 Lig~t 104438 151874 35078 49266 139516 201140 TraIn sWItchIng 856137 864118 bull bull 856137 864118 Yard switching 1_ __=5-58757--2_1_--=-58---62-=-6-=48=_1 __~4--28-0-54__=31__--441--949-1 __60161_15_1 __630_4--59-=-7

Total locomotive miles 1-162213--2561----=-17-168859=_1---=6649-deg-=69=-1----723-234-4+2=2c862325_1_---=-24401203=_

CAR MILES

Loaded freight cars 431972870 466352092 517228 101495 432490098 466453587 Empty freigh tears I~26624=2gt490_127-=325-=-3~4~594-1------=--5==-- bull6471=-1------=-=-5o-6_01---266--248gt13--1_ 1-27-3gt5-35-154=-

Total loaded and empty freight cars 698215360 739886686 522869 102055 698738229 739988741 Caboose 1~_9285~9235-=-5-1-~1023=2-=-9-651=-1------=_1~--2101------=-~2~1~1=7--1-~9~86-0--5-6--5-1-=-1=_=0--33__1--7--68--

Total freight car miles 17deg8gtdeg742715-1-7502216233~7 1_----=524-079=-1_---=104172_ 1-7deg825982794=-1 _---750-320509=_

Passenger coaches 4913 3974 22864172 23715856 22869085 23719830 Sleeping and parlor cars (Company) 1812568 1817919 1812568 1817919 Sleeping cars (Pullman) 38383 35410 12685592 13337316 12723975 13372726 Club lounge dining and observation cars 547 bull 4989125 5250522 4989672 5250522 Combination passenger and head end cars 501995 659233 169149 142633 671144 801866 Mail express and baggage cars 2570197 2539863 21120653 22269656 23690850 24809519 Business cars 1---=--3-6~66-41--=-=---44---1-5 133-deg82_ 1_-----1--49-=-3deg8_ 1_--16-=-974-=6_1_-----_193---4657-_ 1_----shy

Total passenger car miles I~--=3215226~99-1-__=__3~282=63=__7_1-63-7--7--4~3--41_1--6-6-6-83-21--0+-66--9-2 65--847shy72deg4deg+-=-=-69--9--Grand total car miles 1 7_11 _227--4_1_4_1 753 498-974_1_6_429_84_2deg---1_6_67_8_7--=3_8_2_ 775 525--8--=34_ __8_2deg_2_86--bull356_

1 1

GROSS TON MILES

Locomotives and tenders (thousands) 1_ __=3-3942655-1 __3450-518--1__2--0_4_22_10---1 __21_6--2 1-13_ _---=5 436--865_ __5--612__=6311 1Freight cars contents and cabooses (thousands) 31409774 32603899 23551 4151 31433325 32608050 Passenger cars and contents (thousands) 1---1632517-1---------=-1670109=-1---41deg29-=-95_1--42999-8--4-1---4--26625o-12=-1------4=467o-O973=-

To tal freig ht and passenger (th0 usands) 1 31 57322-911_----32-- 771degdeg8=_1 41_265_46_ 1__4--=30_4 135_1 35--699--8__=37_ ____=_37-- 075_14__=3-shy1

TRAIN HOURS

Train hours in road service 473544 507565 137163 154436 610707 662001

REVENUE AND NONREVENUE FREIGHT TRAFFIC Tons of revenue freight ~8305568 40199394 Tons of nonrevenue freight middot1middotmiddotmiddot--- middotmiddot-=middot1middot---middotmiddotmiddotmiddot--- middotmiddot-1middotmiddot---middot---middotmiddotmiddot--- cl __ __ middot_middotmiddotmiddot1 _=-=-8421=-=35_ 1-------1_=_deg6--deg-53-7shy

Total tons of freight IC--- I~ +bull--- 1 --- ---1 392147-7deg3_1_---=-41=2-59093-1 Net ton miles revenue freight (thousands) 13604642 14121940 Net ton miles nonrevenue freight (thousands) middot1-middotmiddot--middot-middot=~-c- -1-------------middot1middotc----c_c I_____--_middot~middot-middotmiddotI_=-=---25797-5179c+----=-3_=_81c-0=-36--

Total net ton miles of freigh t (thousands) 1_c138530726=_1----=-145021~3=-301--104~35 _1 1646_1-1386421611----=-145deg2976

REVENUE PASSENGER TRAFFIC

Passengers carried 6795919 7360687 Passenger miles 626790115 647209137

MOTOR VEHICLE OPERATIONS EXCLUDED ABOVE Net ton miles revenue freight (thousands) 1124 1318 Passengers carried 995 1914 Passenger miles 1041447 991687

30

ANNUAL REPORT FOR 1960

STATISTICS OF OPERATIONS-CONCLUDED

-ITEMS 1960 1959 1958 1957 1956 1955

FREIGHT TRAIN STATISTICS AND AVERAGES

Gross ton miles trailing (thousands) 31573291 32771008 32413288 34236747 36203655 36228284

Eastbound 17124676 18176737 18125895 18805435 19734331 19787705 Westbound 14448615 14594271 14287393 15431312 16469324 16440579

Steam middot middot 135 133258 Dieselmiddotelectric 29107869 29901296 29705585 31129417 32597742 32536016 Electric 2465422 2869712 2707703 3107330 3605778 3559010

Per cent steam - middot 4 Per cent Dieselmiddotelectric 922 912 916 909 900 898 Per cent electric 78 88 84 91 100 98

Loaded freight cars per train 452 459 443 443 446 434 Empty freigh t cars per train 279 270 277 267 247 235

Total freight cars per train 731 729 720 710 693 669

Gross tons per train - 3305 3228 3157 3117 3070 2969 Net tons per train 1450 1428 1390 1373 1370 1323 Net tons per loaded car 321 311 313 310 307 305 Miles per car per day (serviceable freight) 393 390 357 370 387 377 Net ton miles per freight car-day 736 734 655 673 715 702 Train speed (train miles per train hour) 202 200 196 192 191 190 Gross ton miles (trailing) per train hour 66674 64565 61714 59780 58328 56315

PASSENGER TRAIN STATISTICS AND AVERAGES

Passenger car miles (excluding motor) - 64230016 66525240 69087808 75256765 86613202 72582117

Steam middot 13184 16967 Dieselmiddotelectric 64227781 66502614 65218200 71665998 81157901 66905429 Electric 2235 22626 3869608 3590767 5442117 5659721

Per cent steam middot Per cent Diesel-electric 1000 1000 944 952 937 922 Per cent electric middot 56 48 63 78

Cars per train (excluding motor) 1038 987 960 960 984 891 Revenue passengers per train 1012 952 898 865 894 812 Revenue passengers per car 166 165 161 160 168 175 Train speed (train miles per train hour) 452 441 444 439 447 429

YARD SWITCHINGSTATISTICS

Yard switching hours 1002686 1Oi0766 1063803 1184130 1251620 1274248

Steam middot 7 11279 Dieselmiddotelectric 994370 1038534 1056660 1174874 1235025 1246748 Electric 8316 12232 7143 9256 16588 16221

Per cent steam middot middot 9 Per cent Dieselmiddotelectric 992 988 993 992 987 978 Per cent electric 8 12 7 8 13 13

DENSITY STATISTICS

Per mile of road per day (freight service) Train miles ordinary Net ton miles

Per mile of road per day (passenger service) Train miles Car miles

25 3575

49 507

26 3753

47 463

27 3694

48 455

28 3896

47 450

30 4153

53 517

31 4161

48 425

31

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

REVENUE FREIGHT BY PRINCIPAL COMMODITIES-1960 AND 1959

INCREASE + OR1960 1959 DECREASE shyCOMMODITIES

TONS CARRIED

PERCENT OF TOTAL

TONS CARRIED

PERCENT OF TOTAL TONS PERCENT

PRODUCTS OF AGRICULTURE Wheat Corn Batley and tye Oats shy

Flour meal and mill products Citrus fruits Other fruits fresh and frozen

1708445 1325050

763672 347413

1275613 39049

123945

45 35 20

9 33

1

3

1653685 1281473

738948 298327

1242503 59289

135892

41 32 18 7

31 2 3

+ + + + + --

54760 43577 24724 49086 33110 20240 11947

33 34 33

165 27

341 88

Potatoes other than sweet 0 0 bull 229982 6 264312 7 - 34330 130 Other vegetables fresh and frozen Sugar beets Other products of agriculture

115520 213813

1588516

3

6 41

126388 191132

1480059

3

5 37

-+ +

10868 22681

108457

86 119

73 Total 7731018 202 7472008 186 + 259010 35

ANIMALS AND PRODUCTS Cattle calves sheep and goats 171861 4 198623 5 - 26762 135 Swine 21999 1 33892 1 - 11893 351 Fresh meats 386670 10 427610 10 - 40940 96 Poultry eggs butter and cheese 113551 3 128422 3 - 14871 116 Wool hides and leather 153604 4 161264 4 - 7660 47 Other animals and products 268968 7 265237 7 + 3731 14

Total 1116653 29 1215048 30 - 98395 81

PRODUCTS OF MINES Bituminous coal 4862060 127 5447866 136 - 585806 108 Coke 257305 6 296121 7 - 38816 131 Ores and concentrates Gravel and sand

462461 916755

12 24

385162 1166550

10 29

+ -

77299 249795

201 214

Stone broken ground or crushed Stone rough and finished Asphalt

1291164 77997

195521

34 2 5

1192897 71099

234070

30 2 6

+ + -

98267 6898

38549

82 97

165 Salt 148276 4 165384 4 - 17108 103 Other products of miles 1138894 30 1154731 28 - 15837 14

Total 9350433 244 10113880 252 - 763447 75

PRODUCTS OF FORESTS Logs posts poles and cordwood 1290191 34 1604736 40 - 314545 196 Pulpwood 1028793 27 966773 24 + 62020 64 Lumber and mill products 1845337 48 2434155 61 - 588818 242 Veneer and builtup wood 467827 12 520054 13 - 52227 100 Other products of forests 376413 10 259064 6 + 117349 453

Total 5008561 131 5784782 144 - 776221 134

MANUFACTURES AND MISCELLANEOUS Refined ~etroleum and products 1175165 31 1258601 31 - 83436 66 Sugar ta Ie syrups and molasses Iron and steellroducts

304542 2251993

8 59

293861 2299049

7 57

+ -

10681 47056

36 20

Machinery an boilers 222962 6 230072 6 - 7110 31 Cement Brick building tile and artificial stone

1242018 191608

32 5

1152635 199113

29 5

+ -

89383 7505

78 38

lime and plaster 73696 2 81785 2 - 8089 99 Agricultural implements traCtors and parts 155626 4 206217 5 - 50591 245 Autos trucks parts and tires Beverages

745090 599592

19 16

685152 613561

17 15

+ -

59938 13969

87 23

Ice 32950 1 31716 1 + 1234 39 Fertilizers Paper and paper products

590481 1191363

15 31

535770 1200754

13 30

+ -

54711 9391

102 8

Canned food Jroducts 985346 26 997315 25 - 11969 12 Scrap iron an scrap steel 598594 15 758925 19 - 160331 211 Building paper roofing and woodwork 434465 11 460040 12 - 25575 56 Other manufactures and miscellaneous 4165926 109 4435508 110 - 269582 61

Total 14961417 390 15440074 384 - 478657 31

GRAND TOTAL CARLOAD TRAFFIC 38168082 996 40025792 996 - 1857710 46

ALL lCl FREIGHT 137486 4 173602 4 - 36116 208

GRAND TOTAL CARLOAD AND lCi TRAFFIC 38305568 1000 40199394 1000 - 1893826 47

32

ANNUAL REPORT FOR 1960

NUMBER OF EMPLOYEES AND COMPENSATION

REGULAR EMPLOYEES TOTAL COMPENSATION ALL EMPLOYEES PART TIME

EMPLOYEES CHARGED ToAVERAGE CoMPENSATION

YEAR Noop

EMPLOYEES (MIDDLE

OP MONTH COUNT)

CoMPENSATION

AVERAGE COMPENSATION

PER EMPLOYEE

(NOT SUBJECT TO

CONTINUING AUTHORITY

OP RAILROAD)

TOTAL COMPENSATION OPERATING

EXPENSES

ADDITIONS AND

BETTERMENTS AND OTHER ACCOUNTS

1928 48129 $ 81744769 $1698 $135855 $ 81880624 $ 75548543 $ 6332081 1933 26493 39042823 1474 129469 39172292 36740362 2431930 1938 28988 52830262 1822 100092 52930354 48224635 4705719 1943 35377 90305409 2553 145093 90450502 84109945 6340557 1948 38268 138490345 3619 172016 138662361 126543269 12119092 1950 33668 128201025 3808 167342 128368367 121226784 7141583 1951 33846 143260363 4233 219693 143480056 134493624 8986432 1952 32550 145397263 4467 149515 145546778 138390501 7156277 1953 31138 138117562 4436 145500 138263062 131304863 6958199 1954 27961 126272397 4516 143400 126415797 120564532 5851265 1955 27936 126447937 4526 139330 126587267 120732130 5855137 1956 27408 134534522 4909 123452 134657974 126936601 7721373 1957 26007 133239878 5123 117455 133357333 125221025 8136308 1958 23402 128237334 5480 119269 128356603 123103272 5253331 1959 middotmiddot 22243 128292584 5767 107083 128399667 122031078 6368589 1960 20229 121037664 5983 98143 121135807 114993442 6142365

NUMBER OF EMPLOYEES AND COMPENSATION BY STATES

REGULAR EMPLOYEES PART TIME TOTAL

AVERAGE EMPLOYEES COMPENSATIONSTATE

AVERAGE TOTAL CoMPENSATION TOTAL ALL NUMBER COMPENSATION PER COMPENSATION EMPLOYEES

EMPLOYEE

Illinois bull 5977 $ 35954281 $6015 $18179 $ 35972460 Iowa 2062 12410458 6019 5105 12415563 Wisconsin bull 5272 30334008 5754 21200 30355208 Minnesota 2446 14392068 5884 8726 14400794

122 906621 7431 0 906621~~~~~fmiddotmiddotmiddotmiddotmiddot 346 2035311 5882 10780 2046091 Indiana 289 1726773 5975 9180 1735953 South Dakota 902 5244002 5814 180 5244182 North Dakota bullbull 98 524782 5355 2599 527381 Moncana bull 1060 6740641 6359 22074 6762715 Idaho 94 574143 6108 0 574143 Washington 1412 9145616 6477 120 9145736 All otherbullbullbullbullbull 149 1048960 7040 0 1048960

Total 20229 $121037664 $5983 $98143 $121135807

TOTAL PAYROLLS AND COMPANY CONTRIBUTIONS AVERAGE PER EMPLOYEE

COMPANY CoNTRIBUTIONS STRAIGHT TIME RATETOTAL AVERAGE

PAYROLLSshyYEAR RETIREMENT AND HEALTH AND TOTAL PER AVERAGE INCREGULAR

UNEMPLOYMENT WELPARE EMPLOYEE PER OVEREMPLOYEES TAXES BENEFITS HOUR 1939

1950 $128201025 $7234363 $135435388 $4023 $1580 1179 1951 143260363 7774582 151034945 4463 1754 1419 1952 145397263 7696578 153093841 4703 1852 1554 1953 138117562 7441326 145558888 4675 1895 1614 1954 126272397 7035232 133307629 4768 1945 1683 1955 126447937 7276300 $ 624381 134348618 4809 1959 1702 1956 134534522 8581092 1403449 144519063 5273 2130 1938 1957 133239878 8692650 2106181 144038709 5538 2290 2159 1958 128237334 8420346 1934613 138592293 5922 2465 2400 1959 128292584 9894538 1819163 140006285 6294 2566 2539 1960 121037664 9969699 1646241 132653604 6558 2638 2639

33

ANNUAL REPORT FOR 1960

INVESTMENT IN PROPERTIES

ACCOUNT BALANCE AT JANUARY 1

EXPENDITURES DURING THE YEAR

CREDITS FOR PROPERTY RETIRED DURING THE YEAR

BALANCE AT DECEMBER 31

J

ROAD Engineering Land for transportation purposes Other right-of-way expenditures Grading Tunnels and subways Bridges trestles and culverts Ties Rails Other track material Ballast Track laying and surfacing Fences snowsheds and signs Station and office buildings Roadway buildings Water stations Fuel stations Shops and enginehouses Storage warehouses Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous structures Roadway machines Roadway small tools Public improvements-Construction Other expenditures-Road Shop machinery Power-plant machinery

$ 19526006 39048637

381312 143144397

9833072 76929583 34650264 68850190 47424085 26425043 33120819

5401156 26590033

2113899 1091355

746608 19544030

64349 1607522 6300222

21437281 1612483 9737209

673072 8486729

321671 14661137

335 7212584 5500804

$ 80269 $ 47281 105987 319878 77192

258951 255767 114819 42593

1013757 304057 116894 47625 251013 51045 471429 50791

90866 25183 196827 57265

13843 2672 450470 826144

7026 37792 15021 69162

3325 173 537467 38753

29057 58332

564767 157799 360010 104017

612 13590 5060

79 5656 588388 61627

1042 270 232514 59940

422650 96923

3149 20334

$ 19558994 38834746

458504 143147581

9905298 77639283 34719533 69050158 47844723 26490726 33260381

5412327 26214359

2083133 1037214

749760 20042744

64349 1578247 6707190

21693274 1611871 9745739

667495 9013490

322443 14833711

335 7538311 5483619

TOTAL ROAD 632435887 6020402 2746751 635709538

EQUIPMENT Locomotives Freight-train cars Passenger-train cars Floating equipment Work equipment Miscellaneous equipment

124658042 169559340

31348424 278731

6893714 2333999

248407 598587 13410931 6445607

237485

91258 221157

216303 162850

124307862 176524664

31110939 278731

6763815 2387452

TOTAL EQUIPMENT 335072250 13966899 7665686 341373463

GENERAL EXPENDITURES 38292664 260 84367 38208557

r IMPROVEMENTS ON LEASED PROPERTY 618871 270 619141

TOTAL OPERATING PROPERTIES 1006419672 19987831 10496804 1015910699

MISCELLANEOUS PHYSICAL PROPERTY Non-operating property Track material loaned

7007150 206040

102359 6922

141991 7926

6967518 205036

TOTAL MISCELLANEOUS PHYSICAL PROPERTY 7213190 109281 149917 7172554

TOTAL PROPERTIES BEFORE RECORDED DEPRECIATION $1013632862 $ 20097112 I $ 10646721 $ 1023083253

21

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

CONTINGENT LIABILITIES WITH RESPECT TO SECURITIES OF OTHER COMPANIES AS OF DECEMBER 31 1960

ITEMS AMOUNT

CHICAGO UNION STATION COMPANY 1 First Mortgage Bonds 3Ya Series F due July 1 1963 $ 13718000 2 First Mortgage Bonds 2Ys Series G due July 1 1963 34030000 3 Note 5ri due September 1 1961 2500000

50248000 Principal and interesr guaranteed jointly and severally by the Railroad Com~any and 3 other proprietors at time of issue The

Railroad Company with other proprietors has agreed that gross rental to e paid bJ them for use of Chicago Union Station faciliries shall include a sum sufficient ro pay interest on all of these securiries an the payment into the Retirement Fund for First Mortgage bonds beginning in 1955 and to advance amounts requited to pay at maturity ptincipal of Item 3

INDIANA HARBOR BELT RAILROAD COMPANY 1 First Mortgage Bonds 5Ya due June I 1982 7235000 2 Equipment Trust Certificates 2 due annually Segtember 15 1961 to September 15 1964 772000 3 Equipment Trust Certificates 2ri due annually Fe ruary 15 1961 to February 15 1965 600000

8607000 Principal and interest on the 5Ya Bonds is guaranteed jointly and severally by the Railroad Company and 3 other proprietors

The Railroad Company and other proprietors severally guarantee in proportion to their stock holdings the payment by the Belt Railroad of the principal of and dividends on equipment obligations Items 2 and 3

KANSAS CITY TERMINAL RAILWAY COMPANY 1 First Mortgage Serial Bonds due annually October 1 1961 to October I 1974 38602000

Under a certain operating agreement the Railroad Company and 11 other proprietors are obligated to pay to the Terminal Company or in case of default to the Mortgage Trustee in equal shares the principal of these bonds as they mature in the nature of nonmiddot interest bearing advances and interest thereon as rental

PACKERS CAR LINE COMPANY Conditional Sale Agreements 298272

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-956

THE MINNESOTA TRANSFER RAILWAY COMPANY 1 3yeni Sinking Fund Promissory Notes dueJune 11976 1461600

Under provisions of the bymiddotlaws of the Transfer Co the Railroad Company and 8 other proprietors are required to conmiddot tribute on an ownership basis to (a) an annual sinking fund for these Notes equal to $41412 payable on or before May 20 of each year and (b) semimiddotannual installments of interest on the Notes

THE ST PAUL UNION DEPOT COMPANY 1 First and Refunding Mortgage Bonds 3Ya Series B due October I 1971 10891000

Guaranteed jointly and severally by the Railroad Company and 7 other proprietors each of which is also obligated to advance its ownership proportion of amounts required for Sinking Fund payments and to pay its proportion based upon use of the interest on the bonds

TRAILER TRAIN COMPANY Conditional Sale Agreements 1736741

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-294

TOTAL $111844613

22

ANNUAL REPORT FOR 1960

LONG-TERM DEBT DECEMBER 31 1960

DESCRIPTION DATE OF

ISSUE DATE OF

MATURITY

AMOUNT ORIGINALLY

ISSUED OR ASSUMED

AMOUNT AS OF

DBc 31 1960

AMOUNT HELD BY COMPANY

AMOUNT ACTUALLY

OUTSTANDING RATE PER

CENT

INTEREST

PAYABLB ACCRUED DURING

YBAR First mongage bonds Series A General mortgage income bonds

Series A General mortgage convertible inmiddot

come bonds Series B Five per cent income debentures

Series A The Bedford Belt Ry Co Grsr

mongage bonds The Southern Indiana Ry Co first

mongage bonds Chicago Terre Haute and 5ourbmiddot

eastern Ry Co Firsr and refunding mortgage

bonds Income mortgage bonds

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

I 1944

11944

11944

11955

11946

11946

I 1946 I 1946

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

11994

12019

12044

12055

11994

I 1994

11994 I 1994

$ 59515100

57256600

51422100

60000000

350000

7287000

9571000 6335800

$ 53784300

33905200

34640400

58500000

333000

7236000

9571000 6335800

$ 346300

408500

733100

300000

144000

256000

2051000 1597000

$ 53438000

33496700

33907300

58200000

189000

6980000

7520000 4738800

4

41

41

5

4~

44

4~ 4~

J amp J

April

April

MampS

JA amp J

JA amp J

JA amp J JA amp J

$ 2145645

1513512

1534381

2903400

7961

296938

320161 201133

Eb~ro~)nt obl~gati~~~ ~~ederails 163723218 75220900 75220900 2884166 Totallongmiddotterm debe $415460818 $279526600 $ 5835900 $273690700 $11807297

$100000 pledged undet ChIcago Terre Haute and Southeastern RaIlway Company Fust and refundmg mongage $1515000 pledged under Chicago Milwaukee St Paul and Pacific Railroad Company First mongage

EQUIPMENT OBLIGATIONS DECEMBER 31 1960

INTBRESTDATB OF DATB OF ORIGINAl AMOUNT AMOUNT PRINCIFAL

DESCRIPTION LBASE OR FINAL COST OF ORIGINALLY OUTSTANDING PAYABLB RATE ACCRUBD AGREEMENT MATURITY EQUIPMENT ISSUED DBc 31 1960 DURING 1961 PER PAYABLB DURING

CENT YEARI EQUIPMENT TRUST CERTIFICATES Series HH Apr 11949 Apr 11964 $ 8112742 $ 6060000 $ 1414000 $ 404000 2Ji AampO $ 37260 Series JJ Sept I 1949 Sept 1 1964 7604384 5640000 1504000 376000 2li MampS 34846 Series KK Oct I 1949 Oct 11964 ~026868 4500000 1200000 300000 2~ AampO 30375 Series LL June I 1950 June 1 1965 289514 4650000 1395000 310000 24 J amp D 36038 Series MM Nov 11950 Nov I 1965 7251863 5430000 1810000 362000 2n MampN 48554 Series NN June I 1951 June I 1961 7254678 5300000 265000 265000 2Ya JampD 17776 Series 00 OCt I 1951 Oct 11966 10053530 7500000 3000000 500000 2Ya AampO 93437 Seties PP bull Mar 11952 Mar 11967 3215855 2400000 1040000 160000 2Ya MampS 31817 Series QQ Sept I 1952 Sept 1 1967 5441323 3990000 1862000 266000 3Va MampS 61651 Series RR Jan I 1954 Jan 11969 10379112 7650000 4335000 510000 3Va J ampJ 139454 Series SS July 11954 July 11969 9931620 7800000 4680000 520000 24 J ampJ 132275 Series TT Nov 1 1954 Nov I 1969 9141903 7200000 4320000 480000 2Ya MampN 132250 Series UU Jan 11956 Jan 11971 9655380 7500000 5250000 500000 3raquo J amp J 181407 Series VV (1st Install) Feb I 1957 Feb 11972 3000000 2300000 200000 4 FampA 94667 11745718 Series VV (2nd InSltaII) Feb I 1957 Feb I 1972 6000000 4600000 400000 4Vs F ampA 207084 Series WW Jan 11958 Jan 11973 6814810 5400000 4500000 360000 4gtil J amp J 189338 Series XX Feb I 1959 Feb 11974 7419495 5850000 5265000 390000 41 FampA 242775Series YY (1st Install) Feb I 1960 Feb I 1975 3000000 2900000 200000 4Ya FampA 121878 Series YY (2nd Install) Feb 11960 Feb I 1975 9683950 4650000 4495000 310000 4~ FampA 128844 CONDITIONAL SALE AGREEMENTS

The FitS( National Bank of Chimiddot ca~o Assignee of the Sellers

Paci c Car amp Foundty Co May I 1956 Nov I 1964 1843205 1428400 731357 182916 395 FMAampN 32094First Wisconsin Narional Bank of

Milwaukee and Northwestmiddot ern National Bank of Minneshyapolis Assignees of tbe SeUers

General Motors Corpn (Electro-Motive Div) Feb 25 1953 May 11961 1543977 1155000 80558 80558 3 FMAampN 4594

Fairbanks Motse amp Co July 15 1953 Nov 1 1961 531102 396000 54830 54830 3 FMAampN 2380American Locomotive Co July 15 1953 Nov 1 1961 529935 396000 54830 54830 3 FMAampN 2380Baldwin-LimamiddotHamilton

Corporation July 15 1953 Nov 1 1961 357568 264000 36553 36553 3 FMAampN 1587Seattle-Fitst National Bank Asmiddot

Bai1i~e_~i~Sfa~il~~n Corporation SePt I 1953 Nov 1 1961 357568 264000 36979 36979 335 FMAampN 1791

General Motors Cotpn (Electro-Motive Div) Sept I 1953 Nov 1 1961 1670914 1236000 173128 173128 335 FMAampN 8385

American Locomotive Co Sept I 1953 Feb 11962 529935 396000 69048 55008 335 FMAampN 3135Continental Illinois National Bank

and Ttust Company of Chishycago Assignee of tbe SeUers

Pullman-Srandard Car Manumiddot facturing Co May 11958 Nov I 1973 4920125 4920125 4245616 328008 440 MampN 195836

General American Transpotta tion Corporation May I 1958 Nov I 1973 6165438 6165438 5296389 411029 440 MampN 244862

United States Railway Equipment Co May 11958 Nov 1 1973 570706 570706 494612 38047 440 MampN 22740

General Motors Cotpn Jan 15 1959 Mar I 1974 8680000 8680000 7812000 578666 5 MampS 402656 Total equipment obligations $163723218 $129391669 $75220900 $ 8843)52 $ 2884166

PAYMENTS MATURING IN YEARS ENDING December 31 1961 $ 8843552 December 31 1966 $ 6151751 December 311971 $ 3465751December 31 1962 8108041 December 31 1967 5571751 December 311972 291751December 311963 8101627 December 31 1968 )225751 Decembet 31 1973 bull 2370271Decembet 31 1964 bull 7862066 December 31 1969 4970751 Decembet 31 1974 994335December 311965 6668751 December 31 1970 3715751 December 311975 _ 255000

Total $75220900

23

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

MILES OF ROAD BY STATES DECEMBER 31 1960

ROAD OPERATED

STATE OWNED SOLELY OWNED JOINTLY TRACKAGELEASED TOTALMAIN BRANCH MAIN BRANCH RIGHTS

LiNE LINE LINE LINE

Idaho 11276 11083 9middot11 23270 Illinois 43296 11755 240 14 13231 68536 Indiana 15591 3679 19270 Iowa 119993 51468 08 04 10 6706 178189 Kansas 705 705

Michigan 5782 11978 25 583 18368 Minnesota 75531 35154 503 2270 19410 132868 Missouri 13002 944 1651 15597 Montana 74753 47322 2999 46 125120 Nebraska 562 562

North Dakota 10250 26329 110 36689 South Dakota 104314 69528 173842

31469 47426 2688 5000 20110 106693i~~~~J~n 103928 47228 1634 7051 159841

Total 609185 362950 4383 12056 10 70966 1059550

Includes 97 mile owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contraCt

MILES OF TRACK DECEMBER 31 1960

OWNED OWNED TRACKAGEITEMS LEASED TOTALSOLELY JOINTLY RIGHTS

Miles of Road (First Main Track) Operated 972135 16439 10 70966 1059550 Not operated 362 362

Additional Main Tracks Operated 69332 1424 41 31329 102126 Not operated

Yard Tracks and Sidings Operated 321153 25542 219 47997 394911 Not operated 228 2626 2854

I-----f------f-----middotI-----I----shyTotal operated 1362620 43405 270 150292 1556587

Total not operated 590 2626 3216 I-----f-----Imiddot-----I-----I----shy

Grand Total 1363210 46031 270 150292 1559803

Miles of Road operated includes 97 mile Yard Tracks and Sidings operated includes 124 miles owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contract

24

ill ~ It

I I I i I I I bull II III

ANNUAL REPORT FOR 1960

DETAILED STATEMENT OF RAILWAY OPERATING REVENUES AND EXPENSES

RAILWAY OPERATING REVENUES

1960 1959 INCREASE DECREASE TRANSPORTATION

Freight $189560907 $201536333 middot0 $ 11975426 Passenger 15174969 15282171 107202 Baggage 79806 86066 middot 6260 Parlor and chair car 83476 91957 8481 Mail 9418410 8862116 $ 556294 Express 3030579 3180656 150077 Other passenger-crain 107746 100303 7443 Milk 18260 30216 middot 11956 Switching 5979910 6591066 611156

1------1------1-------1------shyTOTAL TRANSPORTATION REVENUE 223454063 235760884 12306821

INCIDENTAL

Dining and buffet 1521218 1527536 6318 Station crain and boat privileges 57552 56068 1484 Storage-Freight 8015 11196 - 3181 Storage-Baggage 3631 3837 - 206 Demurrage 1240131 1248537 8406 Communication 55650 72541 16891 Rents of buildings and other property 257841 246697 11144 Miscellaneous 461149 507969 middot middot0 46820

TOTAL INCIDENTAL OPERATING REVENUE 3605187 3674381 69194

JOINT FACILITY

Joint facility-Credit 3315646 2620693 694953 Joint facility-Debit (11994) (14133) (2139)

TOTAL JOINT FACILITY OPERATING REVENUE 3303652 2606560 697092

TOTAL RAILWAY OPERATING REVENUE $230362902 $242041825 $ 11678923

( ) Denotes concra items

RAILWAY OPERATING EXPENSES

1960 1959 INCREASE DECREASE MAINTENANCE OF WAY AND STRUCTURES

Superincendence $ 3108012 $ 3388761 $ 280749 Roadway maincenance 2861659 2867371 5712 Tunnels and subways 10889 11354 465 Bridges trestles and culverts 986082 1198575 212493 Ties 1793766 1827106 33340 Rails 592902 894914 302012 Other track material 1336407 1996881 660474 Ballast 217365 408471 middot 191106 Track laying and surfacing Fences snowsheds and signs

6515560 319315

7505265 398716

989705 79401

Station and office buildings 828484 1014046 185562 Roadway buildings 55448 86514 31066 Water stations Fuel stations

12115 26908

21831 16802 $ 10106

9716

Shops and enginehouses 574222 542976 31246

25

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

RAILWAY a PERATING REVENUES AND EXPENSES- CONTINUED RAILWAY OPERATING EXPENSES-CONTINUED

MAINTENANCE OF WAY AND STRUCTURES

Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous StruCtures Road property-Depreciation _ Retiremenes- Road Roadway machines _ Dismantling retired road property Small cools and supplies Removing snow ice and sand Public improvemenes-Maintenance Injuries co persons Insurance Stationery and printing Other expenses Right-of-way expenses Maineaining joint cracks yards and other facilities-Debit Maintaining joint tracks yards and other facilities-Credit

TOTAL MAINTENANCE OF WAY AND STRUCTURES

MAINTENANCE OF EQUIPMENT

Superintendence Shop machinery Power-plant machinery Shop and powerplant machinery-Depreciation Dismantling retired shop and powermiddotplane machinery Other locomotives-Repairs Freight-train cars-Repairs Passenger-train cars-Repairs Work equipment-Repairs Miscellaneous equipment-Repairs Dismantling retired equipment Retirements-Equipment Equipmene- Depreciation Inj uries to persons Insurance Stationery and printing Other expenses Taint maintenance of equipment expenses-Debit Taint maineenance of equipmene expenses-Credit

TOTAL MAINTENANCE OF EQUIPMENT

TRAFFIC

Superintendence Outside agencies Advertising Traffic associations Industrial and immigration bureaus Insurance Stationery and printing Other expenses

1960 1959 INCREASE DECREASE

$ 56714 $ 36447 $ 20267 bullbullbullbullbullbullbull _0 bullbullbullbullbullbull

935578 909129 26449 bullbull 0 bullbullbullbullbullbullbull 0 bullbullbullbullbull

bullbullbullbullbullbull 0 bullbullbullbullbullbull bull bullbull 1838913 1653168 185745 31898 33384 $ 1486 301492 355954 54462 9685 11190 middot 1505 5028247 4953681 74566 197350 241483 44133 706168 892299 186131 107360 148842 middot 41482 780012 825073 45061 841898 1093119 251221 736255 713553 22702 0 326277 442052 115775 50816 46225 4591 71268 87971 16703 419344 470012 50668bull bullbull 0 bullbullbullbullbullbullbullbullbullbull

43266 45762 2496

2725332 2842160 middot 116828

(755037) (550863) (204174) 1------1------1-------1------shy

33691970 37430224 3738254

1716762 1720882 41200 bullbullbullbullbullbullbullbullbullbullbullbullbullbullbull

521695 506499 15196

133941 153222 19281

284088 285333 1245

3681 856 2825

12448450 13197294 748844

9119749 10867539 1747790

2844061 3581261 737200

249163 301007 middot 51844

196990 196551 439

110983 91095 19888

(139163) (764585) (625422)

10468468 10143824 324644

245956 297309 51353

66754 68018 1264

42632 59005 16373

477426 563338 85912

292109 629586 337477

( 35052) (35250) (198)

39048693 41862784 2814091

1853253 1775877 77376

3420570 3680896 260326

641695 669595 27900

316941 281954 34987

50793 58011 7218

991 875 116

267539 246898 20641

29672 34959 5287 1------1------1middot------1------shy

TOTAL TRAFFIC EXPENSES $ 6581454 $ 6749065 $ 167611

( ) Denotes contra items

26

ANNUAL REPORT FOR 1960

RAILWAY OPERATING REVENUES AND EXPENSES-CONCLUDED

RAILWAY OPERATING EXPENSES-CONCLUDED

1960 1959 INCREASE DECREASE TRANSPORTATION

Superintendence $ 2981453 S 2814960 $166493 Dispatching trains 737390 807806 $ 70416 Station employees 12568811 13277513 708702 Weighing inspection and demurrage bureaus 307278 325534 bullbullbullbullbullbull 0 bullbullbullbullbullbullbullbullbull 18256 Station supplies and expenses 1091896 1140062 bullbull 0 bullbullbull 0 bullbullbullbullbullbull 0 bullbull 48166 Yardmasters and yard clerks 3991133 4119498 bullbullbullbullbullbull 0 bullbullbullbullbullbull 0 bullbull 128365 Yard conductors and brakemen 9303622 9647318 343696 Yard swirch and signal tenders 730410 755025 24615 Yard enginemen 6155278 6362440 207162 Yard switching fuel 923737 988987 65250 Yard switching power purchased 11946 15258 bullbull 0 bullbullbullbullbullbullbullbullbullbullbullbullbull 3312 Water for yard locomotives 17360 19948 2588 Lubricants for yard locomotives 83523 109472 25949 Other supplies for yard locomotives Enginehouse expenses-Yard

49721 498339

48817 542983

904

44644

Yard supplies and expenses Operating joint yards and terminals-Debit Operatin~ joint yards and terminals-Credit Train engInemen Train fuel Train power purchased Water for train locomotives

466959 5790981 (683719)

9533667 7243332

864933 94310

441246 5978628 (685475)

9966568 7758783

907295 105164

25713 middot bull bullbull 0 bullbullbullbullbullbullbullbullbullbull 0

middot

187647

(1756) 432901 515451 42362 10854

Lubricants for train locomotives 795622 938600 142978 Other supplies for train locomotives Enginehouse expenses-Train Trainmen

210707 1124921

12091384

202708 1222756

12613963

7999 bullbullbullbull 0 bullbullbullbullbullbullbull bullbullbullbull

97835

522579 Train supplies and expenses 6340264 6660876 320612 Operating sleeping cars 715113 526531 188582 Signal and interlcker operation CrOSSIng protectIOn

1049887

721750 1037947

806370 11940

middot

84620 Drawbridge operation 215086 258082 42996 Communication system operation 1060497 1081772 21275 Operating Boating equipment 11796 10985 811 Srationery and printing 412827 392820 20007 Other expenses 817489 848149 30660 Operating joint tracks and facilities-Debit 1170056 1311393 141337 Operating joint tracks and faciliries-Credir Insurance

(786053)

78437 (751937)

92514 (34116)

14077 Clearing wrecks Damage to property

265853 120728

230128 206210

35725

85482

Damage to live stock on right-of-way Loss and damage-Freight

80817

2795442 53816

2942960 27001

147518 Loss and damage-Baggage 5528 722 4806 Injuries to persons 1708733 1714453 5720

TOTAL TRANSPORTATION EXPENSES 93769244 97849648 4080404

MISCELLANEOUS OPERATIONS Dining and buffet service 2855845 2888241 32396 Operaring joint miscellaneous facilities-Debit 149757 207418 57661

J------J------I-------I------shyTOTAL MISCELLANEOUS OPERATIONS 3005602 3095659 90057

GENBRAL Salaries and expenses of general officers 1421416 1331832 89584 Salaries and expenses of clerks and attendants 6821635 6920559 98924 General office supplies and expenses 753564 727092 26472 Law expenses 831662 811940 19722 Insurance 33708 6002 27706 Pensions and gratuities 818190 917286 99096 Stationery and priming 348137 336267 11870 Valuation expenses 53068 59453 6385 Other expenses 501292 520844 19552 General joint faciliries-Debit 258783 241859 16924 General joint faciliries-Credit (8615) (8933) (318)

TOTAL GENERAL EXPENSES 11832840 11864201 middot 31361

GRAND TOTAL RAILWAY OPERATING EXPENSES $187929803 $198851581 $10921778

( ) Denotes contra items

27

bullbullbull

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

ANALYSIS OF INCREASES AND DECREASES IN TOTAL RAILWAY OPERATING EXPENSES 1960 COMPARED WITH 1959

MAINTENANCE MAINTENANCE TRANSshyITEMS OF WAY AND OP ALL OTHER TOTALPORTATIONSTRUCTURES EQUIPMENT

LABOR General wage increases + $ 360933 + $ 323486 + $1370434 + $ 289045 + $ 2343898 Straight time worked - 2213317 - 2135307 - 4273302 - 680973 - 9302899 Overtime worked - 76922 - 10613 - 163702 9398 - 241839+ Time paid for not worked (incl vacations and holidays) - 100783 - 137170 - 123771 33475 - 323249+

TOTAL LABOR - 2030089 - 1959604 - 3190341 - 344055 - 7524089

FUEL Price middot middot middot - 375791 - 375791 Consumption middot middot middot - 204910 - 204910

TOTAL FUEL middot middot middot middot - 580701 middot - 580701

ELECTRIC POWER middot bullbullbullbullbullbull to middot middot - 45674 middot - 45674

MATERIAL-Ocher than fuel Price + 106251 112344 - 1059 17453 234989 Quanticy - 1181388 - 900335 201128 34210 - 1846385

+ + + + +

TOTAL MATERIAL OTHER THAN FUEL - 1075137 - 787991 200069 51663 - 1611396+ + MISCELLANEOUS

Health and welfare benefits - 38735 - 60626 - 57909 - 15652 - 172922 Other miscellaneous - 624726 - 954691 - 405848 19015 - 1966250+

TOTAL MISCELLANEOUS - 663461 - 1015317 - 463757 3363 - 2139172+ TOTAL LABOR MATERIAL AND MISCELLANEOUS - 3768687 - 3762912 - 4080404 - 289029 - 11901032

DEPRECIATION + 74566 323399 middot + 397965+ middotRETIREMENTS - 44133 625422 middot + 581289+

TOTAL DEPRECIATION AND RETIREMENTS + 30433 948821 middot middot + 979254+ TOTAL RAfLWAY OPERATING EXPENSES - $3738254 - $2814091 - $4080404 289029 - $10921778-I $

RAILWAY OPERATING REVENUES EXPENSES TAXES AND INCOME BY MONTHS FOR THE YEAR ENDED DECEMBER 31 1960

1960

RAILWAY OPERATING REVENUES

RAILWAY OPERATING

EXPENSES

NET REVENUE FROM

RAILWAY OPERATIONS

RAILWAY TAX

ACCRUALS

RAILWAY OPERATING

INCOME

EQUIPMENT RENTS-NET

DR

JOINT FACILITY

RENTS-NET DR

NET RAILWAY OPERATING

INCOME

January $ 17336067 $ 15803272 $ 1532795 $ 1670000 $ (137205) $ 422175 S 231113 $ (790493) February 18493440 15151942 3341498 1673000 1668498 490735 234172 943591 March 19025746 15902966 3122780 1695000 1427780 686903 219282 521595 April bull 18042813 15280563 2762250 1684000 1078250 586443 251268 240539

May 18975935 16148830 2827105 1728000 1099105 824503 181449 93153 June 19011723 16297457 2714266 1727000 987266 803292 217671 (33697) July 18796482 15947748 2848734 1728000 1120734 823376 203289 94069 August 23377375 17022049 6355326 1806000 4549326 1420370 316997 2811959

September 20166066 15953895 4212171 1685000 2527171 1100653 248649 1177869 October 20925500 14736878 6188622 1647000 4541622 980838 252319 3308465 November 18549759 14797644 3752115 1620000 2132115 848876 267507 1015732 December 17661996 14886559 2775437 1474000 1301437 791725 238186 271526

Total $230362902 $187929803 $42433099 $20137000 $22296099 $9779889 $2861902 $9654308

( ) Denotes contra items 28

ANNUAL REPORT FOR 1960

REVENUE FREIGHT TRAFFIC STATISTICS-EXCLUDING TRUCK SERVICE

FREIGHT REVENUE AVERAGE

TONS TONSYEAR HAUL- PERCARRIED MILES PER

MILES TOTAL TON MILETON

(CENTS)

1951 51740580 16732323827 32339 $217832219 $421 1302 1952 49522089 16005309995 32320 222648097 450 1391 1953 46810989 15413226569 32927 215622726 461 1399 1954 43123214 14178678856 32879 197712105 458 1394 1955 45481060 95561748530 34216 205993029 453 1324

1956 45351213 15612344863 34425 209886542 463 1344 1957 42915573 14614118553 34025 212631339 495 1455 1958 40117213 13884510331 34610 205489920 512 1480 1959 40199394 14121939599 35130 201705278 502 1428 1960 38305568 13604642301 35516 189750236 495 1395

REVENUE PASSENGER STATISTICS-EXCLUDING BUS SERVICE

PASSENGER REVENUE AVERAGE

PASSENGERS PASSENGER DISTANCE PER YEAR

CARRIED MILES TRAVELED PER PASSENGER TOTAL

-MILES PASSENGER MILE (CENTS)

OTHER THAN COMMUTATION

1951 3341410 776958568 23252 $ 18484470 $553 2379 1952 3346346 739380708 22095 17569369 525 2376 1953 3158639 658842799 20858 15396026 487 2337 1954 3057733 599281006 19599 13582309 444 2266 1955 3003108 571128913 19018 12413340 413 2173

1956 3266663 696906549 21334 15758692 482 2261 1957 2943819 587947230 19972 14064509 478 2392 1958 2889740 549258597 19007 12969955 449 2361 1959 1839572 523514965 28459 12490275 679 2386 1960 1759253 515650913 29311 12095377 688 2346

CoMMUTATION

1951 4186842 94960045 2268 $ 1251058 $ 30 1317 1952 3899249 89299292 2290 1325955 34 1485 1953 3823231 88929041 2326 1316554 34 1480 1954 3920824 93543801 2386 1374494 35 1469 1955 4176751 98901556 2368 1463125 35 1479

1956 4150616 100135407 2413 1474073 36 1472 1957 4074228 98630820 2421 1463767 36 1484 1958 4338777 103055843 2375 1567002 36 1521 1959 5521115 123694172 2240 2818185 51 2278 1960 5036666 111139202 2207 3095340 61 2785

TOTAL

1951 7528252 871918613 11582 $ 19735528 $252 2263 1952 7245595 828680000 11437 18895324 261 2280 1953 6981870 747771840 10710 16712580 239 2235 1954 1955

6978557 7179859

692824807 670030469

9928 9332

14956803 13876465

214 193

2159 201

1956 7417279 797041956 10746 17232765 232 2162 1957 7018047 686578050 9783 15528276 221 2262 1958 1959 1960

7228517 7360687 6795919

652314440 647209137 626790115

9024 8793 9223

14536957 15308460 15190717

201 208 224

2229 2365 2424

BeglOnmg With year 1959 lOcludes cash fares single and round trip tickets sold for travel within suburban area which in prior yeaTS were included in Other than Commutation

29

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATISTICS OF OPERATIONS

TOTAL TRANSPORTATIONFREIGHT TRAINS PASSENGER TRAlNS SERVICE ITEMS I

1960 1959 1960 1959 1960 1959

RAlL-LINE Average miles of road operared 1 1deg--589_1---1deg586=_-------34-=68 -1-__394-=-9_1-----=10--597-1---I0-594=-

TRAlN MILES

Ordinary (wirh locomorives) 9554242 10152235 6185162 6740403 15739404 16892638 Ligh t (with locomotives) 1_----27--3-59_ 1__-----_24----42-=5_ 1_middot_-----=--------_1 __---c-_o---=-_ 1_--=-2~73-50-9_1_---2442-5_

Total (with locomotives) 9581601 10176660 6185162 6740403 15766763 16917063 Motor car trains bull middotICmiddotmiddotmiddotmiddot~ ----1----=----middotmiddot_1----------1~7-o1_=_60--1-____=_=65--4_8__7+--=-=-1-721-6_0-1-_________65_--487-

Total train miles 1_ __=9 0-58_1--6_deg 1 1__1deg 176--=66_deg--1 60-2_0_23_22_1 __68_0_5 89_deg_1 __15--7_83-923_1 __16--bull98_2-0-550_

LOCOMOTIVE MILES

Principal 9583849 10180397 6185162 6740403 15769011 16920800 Helper 81260 109822 286 726 81546 110548 Lig~t 104438 151874 35078 49266 139516 201140 TraIn sWItchIng 856137 864118 bull bull 856137 864118 Yard switching 1_ __=5-58757--2_1_--=-58---62-=-6-=48=_1 __~4--28-0-54__=31__--441--949-1 __60161_15_1 __630_4--59-=-7

Total locomotive miles 1-162213--2561----=-17-168859=_1---=6649-deg-=69=-1----723-234-4+2=2c862325_1_---=-24401203=_

CAR MILES

Loaded freight cars 431972870 466352092 517228 101495 432490098 466453587 Empty freigh tears I~26624=2gt490_127-=325-=-3~4~594-1------=--5==-- bull6471=-1------=-=-5o-6_01---266--248gt13--1_ 1-27-3gt5-35-154=-

Total loaded and empty freight cars 698215360 739886686 522869 102055 698738229 739988741 Caboose 1~_9285~9235-=-5-1-~1023=2-=-9-651=-1------=_1~--2101------=-~2~1~1=7--1-~9~86-0--5-6--5-1-=-1=_=0--33__1--7--68--

Total freight car miles 17deg8gtdeg742715-1-7502216233~7 1_----=524-079=-1_---=104172_ 1-7deg825982794=-1 _---750-320509=_

Passenger coaches 4913 3974 22864172 23715856 22869085 23719830 Sleeping and parlor cars (Company) 1812568 1817919 1812568 1817919 Sleeping cars (Pullman) 38383 35410 12685592 13337316 12723975 13372726 Club lounge dining and observation cars 547 bull 4989125 5250522 4989672 5250522 Combination passenger and head end cars 501995 659233 169149 142633 671144 801866 Mail express and baggage cars 2570197 2539863 21120653 22269656 23690850 24809519 Business cars 1---=--3-6~66-41--=-=---44---1-5 133-deg82_ 1_-----1--49-=-3deg8_ 1_--16-=-974-=6_1_-----_193---4657-_ 1_----shy

Total passenger car miles I~--=3215226~99-1-__=__3~282=63=__7_1-63-7--7--4~3--41_1--6-6-6-83-21--0+-66--9-2 65--847shy72deg4deg+-=-=-69--9--Grand total car miles 1 7_11 _227--4_1_4_1 753 498-974_1_6_429_84_2deg---1_6_67_8_7--=3_8_2_ 775 525--8--=34_ __8_2deg_2_86--bull356_

1 1

GROSS TON MILES

Locomotives and tenders (thousands) 1_ __=3-3942655-1 __3450-518--1__2--0_4_22_10---1 __21_6--2 1-13_ _---=5 436--865_ __5--612__=6311 1Freight cars contents and cabooses (thousands) 31409774 32603899 23551 4151 31433325 32608050 Passenger cars and contents (thousands) 1---1632517-1---------=-1670109=-1---41deg29-=-95_1--42999-8--4-1---4--26625o-12=-1------4=467o-O973=-

To tal freig ht and passenger (th0 usands) 1 31 57322-911_----32-- 771degdeg8=_1 41_265_46_ 1__4--=30_4 135_1 35--699--8__=37_ ____=_37-- 075_14__=3-shy1

TRAIN HOURS

Train hours in road service 473544 507565 137163 154436 610707 662001

REVENUE AND NONREVENUE FREIGHT TRAFFIC Tons of revenue freight ~8305568 40199394 Tons of nonrevenue freight middot1middotmiddotmiddot--- middotmiddot-=middot1middot---middotmiddotmiddotmiddot--- middotmiddot-1middotmiddot---middot---middotmiddotmiddot--- cl __ __ middot_middotmiddotmiddot1 _=-=-8421=-=35_ 1-------1_=_deg6--deg-53-7shy

Total tons of freight IC--- I~ +bull--- 1 --- ---1 392147-7deg3_1_---=-41=2-59093-1 Net ton miles revenue freight (thousands) 13604642 14121940 Net ton miles nonrevenue freight (thousands) middot1-middotmiddot--middot-middot=~-c- -1-------------middot1middotc----c_c I_____--_middot~middot-middotmiddotI_=-=---25797-5179c+----=-3_=_81c-0=-36--

Total net ton miles of freigh t (thousands) 1_c138530726=_1----=-145021~3=-301--104~35 _1 1646_1-1386421611----=-145deg2976

REVENUE PASSENGER TRAFFIC

Passengers carried 6795919 7360687 Passenger miles 626790115 647209137

MOTOR VEHICLE OPERATIONS EXCLUDED ABOVE Net ton miles revenue freight (thousands) 1124 1318 Passengers carried 995 1914 Passenger miles 1041447 991687

30

ANNUAL REPORT FOR 1960

STATISTICS OF OPERATIONS-CONCLUDED

-ITEMS 1960 1959 1958 1957 1956 1955

FREIGHT TRAIN STATISTICS AND AVERAGES

Gross ton miles trailing (thousands) 31573291 32771008 32413288 34236747 36203655 36228284

Eastbound 17124676 18176737 18125895 18805435 19734331 19787705 Westbound 14448615 14594271 14287393 15431312 16469324 16440579

Steam middot middot 135 133258 Dieselmiddotelectric 29107869 29901296 29705585 31129417 32597742 32536016 Electric 2465422 2869712 2707703 3107330 3605778 3559010

Per cent steam - middot 4 Per cent Dieselmiddotelectric 922 912 916 909 900 898 Per cent electric 78 88 84 91 100 98

Loaded freight cars per train 452 459 443 443 446 434 Empty freigh t cars per train 279 270 277 267 247 235

Total freight cars per train 731 729 720 710 693 669

Gross tons per train - 3305 3228 3157 3117 3070 2969 Net tons per train 1450 1428 1390 1373 1370 1323 Net tons per loaded car 321 311 313 310 307 305 Miles per car per day (serviceable freight) 393 390 357 370 387 377 Net ton miles per freight car-day 736 734 655 673 715 702 Train speed (train miles per train hour) 202 200 196 192 191 190 Gross ton miles (trailing) per train hour 66674 64565 61714 59780 58328 56315

PASSENGER TRAIN STATISTICS AND AVERAGES

Passenger car miles (excluding motor) - 64230016 66525240 69087808 75256765 86613202 72582117

Steam middot 13184 16967 Dieselmiddotelectric 64227781 66502614 65218200 71665998 81157901 66905429 Electric 2235 22626 3869608 3590767 5442117 5659721

Per cent steam middot Per cent Diesel-electric 1000 1000 944 952 937 922 Per cent electric middot 56 48 63 78

Cars per train (excluding motor) 1038 987 960 960 984 891 Revenue passengers per train 1012 952 898 865 894 812 Revenue passengers per car 166 165 161 160 168 175 Train speed (train miles per train hour) 452 441 444 439 447 429

YARD SWITCHINGSTATISTICS

Yard switching hours 1002686 1Oi0766 1063803 1184130 1251620 1274248

Steam middot 7 11279 Dieselmiddotelectric 994370 1038534 1056660 1174874 1235025 1246748 Electric 8316 12232 7143 9256 16588 16221

Per cent steam middot middot 9 Per cent Dieselmiddotelectric 992 988 993 992 987 978 Per cent electric 8 12 7 8 13 13

DENSITY STATISTICS

Per mile of road per day (freight service) Train miles ordinary Net ton miles

Per mile of road per day (passenger service) Train miles Car miles

25 3575

49 507

26 3753

47 463

27 3694

48 455

28 3896

47 450

30 4153

53 517

31 4161

48 425

31

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

REVENUE FREIGHT BY PRINCIPAL COMMODITIES-1960 AND 1959

INCREASE + OR1960 1959 DECREASE shyCOMMODITIES

TONS CARRIED

PERCENT OF TOTAL

TONS CARRIED

PERCENT OF TOTAL TONS PERCENT

PRODUCTS OF AGRICULTURE Wheat Corn Batley and tye Oats shy

Flour meal and mill products Citrus fruits Other fruits fresh and frozen

1708445 1325050

763672 347413

1275613 39049

123945

45 35 20

9 33

1

3

1653685 1281473

738948 298327

1242503 59289

135892

41 32 18 7

31 2 3

+ + + + + --

54760 43577 24724 49086 33110 20240 11947

33 34 33

165 27

341 88

Potatoes other than sweet 0 0 bull 229982 6 264312 7 - 34330 130 Other vegetables fresh and frozen Sugar beets Other products of agriculture

115520 213813

1588516

3

6 41

126388 191132

1480059

3

5 37

-+ +

10868 22681

108457

86 119

73 Total 7731018 202 7472008 186 + 259010 35

ANIMALS AND PRODUCTS Cattle calves sheep and goats 171861 4 198623 5 - 26762 135 Swine 21999 1 33892 1 - 11893 351 Fresh meats 386670 10 427610 10 - 40940 96 Poultry eggs butter and cheese 113551 3 128422 3 - 14871 116 Wool hides and leather 153604 4 161264 4 - 7660 47 Other animals and products 268968 7 265237 7 + 3731 14

Total 1116653 29 1215048 30 - 98395 81

PRODUCTS OF MINES Bituminous coal 4862060 127 5447866 136 - 585806 108 Coke 257305 6 296121 7 - 38816 131 Ores and concentrates Gravel and sand

462461 916755

12 24

385162 1166550

10 29

+ -

77299 249795

201 214

Stone broken ground or crushed Stone rough and finished Asphalt

1291164 77997

195521

34 2 5

1192897 71099

234070

30 2 6

+ + -

98267 6898

38549

82 97

165 Salt 148276 4 165384 4 - 17108 103 Other products of miles 1138894 30 1154731 28 - 15837 14

Total 9350433 244 10113880 252 - 763447 75

PRODUCTS OF FORESTS Logs posts poles and cordwood 1290191 34 1604736 40 - 314545 196 Pulpwood 1028793 27 966773 24 + 62020 64 Lumber and mill products 1845337 48 2434155 61 - 588818 242 Veneer and builtup wood 467827 12 520054 13 - 52227 100 Other products of forests 376413 10 259064 6 + 117349 453

Total 5008561 131 5784782 144 - 776221 134

MANUFACTURES AND MISCELLANEOUS Refined ~etroleum and products 1175165 31 1258601 31 - 83436 66 Sugar ta Ie syrups and molasses Iron and steellroducts

304542 2251993

8 59

293861 2299049

7 57

+ -

10681 47056

36 20

Machinery an boilers 222962 6 230072 6 - 7110 31 Cement Brick building tile and artificial stone

1242018 191608

32 5

1152635 199113

29 5

+ -

89383 7505

78 38

lime and plaster 73696 2 81785 2 - 8089 99 Agricultural implements traCtors and parts 155626 4 206217 5 - 50591 245 Autos trucks parts and tires Beverages

745090 599592

19 16

685152 613561

17 15

+ -

59938 13969

87 23

Ice 32950 1 31716 1 + 1234 39 Fertilizers Paper and paper products

590481 1191363

15 31

535770 1200754

13 30

+ -

54711 9391

102 8

Canned food Jroducts 985346 26 997315 25 - 11969 12 Scrap iron an scrap steel 598594 15 758925 19 - 160331 211 Building paper roofing and woodwork 434465 11 460040 12 - 25575 56 Other manufactures and miscellaneous 4165926 109 4435508 110 - 269582 61

Total 14961417 390 15440074 384 - 478657 31

GRAND TOTAL CARLOAD TRAFFIC 38168082 996 40025792 996 - 1857710 46

ALL lCl FREIGHT 137486 4 173602 4 - 36116 208

GRAND TOTAL CARLOAD AND lCi TRAFFIC 38305568 1000 40199394 1000 - 1893826 47

32

ANNUAL REPORT FOR 1960

NUMBER OF EMPLOYEES AND COMPENSATION

REGULAR EMPLOYEES TOTAL COMPENSATION ALL EMPLOYEES PART TIME

EMPLOYEES CHARGED ToAVERAGE CoMPENSATION

YEAR Noop

EMPLOYEES (MIDDLE

OP MONTH COUNT)

CoMPENSATION

AVERAGE COMPENSATION

PER EMPLOYEE

(NOT SUBJECT TO

CONTINUING AUTHORITY

OP RAILROAD)

TOTAL COMPENSATION OPERATING

EXPENSES

ADDITIONS AND

BETTERMENTS AND OTHER ACCOUNTS

1928 48129 $ 81744769 $1698 $135855 $ 81880624 $ 75548543 $ 6332081 1933 26493 39042823 1474 129469 39172292 36740362 2431930 1938 28988 52830262 1822 100092 52930354 48224635 4705719 1943 35377 90305409 2553 145093 90450502 84109945 6340557 1948 38268 138490345 3619 172016 138662361 126543269 12119092 1950 33668 128201025 3808 167342 128368367 121226784 7141583 1951 33846 143260363 4233 219693 143480056 134493624 8986432 1952 32550 145397263 4467 149515 145546778 138390501 7156277 1953 31138 138117562 4436 145500 138263062 131304863 6958199 1954 27961 126272397 4516 143400 126415797 120564532 5851265 1955 27936 126447937 4526 139330 126587267 120732130 5855137 1956 27408 134534522 4909 123452 134657974 126936601 7721373 1957 26007 133239878 5123 117455 133357333 125221025 8136308 1958 23402 128237334 5480 119269 128356603 123103272 5253331 1959 middotmiddot 22243 128292584 5767 107083 128399667 122031078 6368589 1960 20229 121037664 5983 98143 121135807 114993442 6142365

NUMBER OF EMPLOYEES AND COMPENSATION BY STATES

REGULAR EMPLOYEES PART TIME TOTAL

AVERAGE EMPLOYEES COMPENSATIONSTATE

AVERAGE TOTAL CoMPENSATION TOTAL ALL NUMBER COMPENSATION PER COMPENSATION EMPLOYEES

EMPLOYEE

Illinois bull 5977 $ 35954281 $6015 $18179 $ 35972460 Iowa 2062 12410458 6019 5105 12415563 Wisconsin bull 5272 30334008 5754 21200 30355208 Minnesota 2446 14392068 5884 8726 14400794

122 906621 7431 0 906621~~~~~fmiddotmiddotmiddotmiddotmiddot 346 2035311 5882 10780 2046091 Indiana 289 1726773 5975 9180 1735953 South Dakota 902 5244002 5814 180 5244182 North Dakota bullbull 98 524782 5355 2599 527381 Moncana bull 1060 6740641 6359 22074 6762715 Idaho 94 574143 6108 0 574143 Washington 1412 9145616 6477 120 9145736 All otherbullbullbullbullbull 149 1048960 7040 0 1048960

Total 20229 $121037664 $5983 $98143 $121135807

TOTAL PAYROLLS AND COMPANY CONTRIBUTIONS AVERAGE PER EMPLOYEE

COMPANY CoNTRIBUTIONS STRAIGHT TIME RATETOTAL AVERAGE

PAYROLLSshyYEAR RETIREMENT AND HEALTH AND TOTAL PER AVERAGE INCREGULAR

UNEMPLOYMENT WELPARE EMPLOYEE PER OVEREMPLOYEES TAXES BENEFITS HOUR 1939

1950 $128201025 $7234363 $135435388 $4023 $1580 1179 1951 143260363 7774582 151034945 4463 1754 1419 1952 145397263 7696578 153093841 4703 1852 1554 1953 138117562 7441326 145558888 4675 1895 1614 1954 126272397 7035232 133307629 4768 1945 1683 1955 126447937 7276300 $ 624381 134348618 4809 1959 1702 1956 134534522 8581092 1403449 144519063 5273 2130 1938 1957 133239878 8692650 2106181 144038709 5538 2290 2159 1958 128237334 8420346 1934613 138592293 5922 2465 2400 1959 128292584 9894538 1819163 140006285 6294 2566 2539 1960 121037664 9969699 1646241 132653604 6558 2638 2639

33

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

CONTINGENT LIABILITIES WITH RESPECT TO SECURITIES OF OTHER COMPANIES AS OF DECEMBER 31 1960

ITEMS AMOUNT

CHICAGO UNION STATION COMPANY 1 First Mortgage Bonds 3Ya Series F due July 1 1963 $ 13718000 2 First Mortgage Bonds 2Ys Series G due July 1 1963 34030000 3 Note 5ri due September 1 1961 2500000

50248000 Principal and interesr guaranteed jointly and severally by the Railroad Com~any and 3 other proprietors at time of issue The

Railroad Company with other proprietors has agreed that gross rental to e paid bJ them for use of Chicago Union Station faciliries shall include a sum sufficient ro pay interest on all of these securiries an the payment into the Retirement Fund for First Mortgage bonds beginning in 1955 and to advance amounts requited to pay at maturity ptincipal of Item 3

INDIANA HARBOR BELT RAILROAD COMPANY 1 First Mortgage Bonds 5Ya due June I 1982 7235000 2 Equipment Trust Certificates 2 due annually Segtember 15 1961 to September 15 1964 772000 3 Equipment Trust Certificates 2ri due annually Fe ruary 15 1961 to February 15 1965 600000

8607000 Principal and interest on the 5Ya Bonds is guaranteed jointly and severally by the Railroad Company and 3 other proprietors

The Railroad Company and other proprietors severally guarantee in proportion to their stock holdings the payment by the Belt Railroad of the principal of and dividends on equipment obligations Items 2 and 3

KANSAS CITY TERMINAL RAILWAY COMPANY 1 First Mortgage Serial Bonds due annually October 1 1961 to October I 1974 38602000

Under a certain operating agreement the Railroad Company and 11 other proprietors are obligated to pay to the Terminal Company or in case of default to the Mortgage Trustee in equal shares the principal of these bonds as they mature in the nature of nonmiddot interest bearing advances and interest thereon as rental

PACKERS CAR LINE COMPANY Conditional Sale Agreements 298272

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-956

THE MINNESOTA TRANSFER RAILWAY COMPANY 1 3yeni Sinking Fund Promissory Notes dueJune 11976 1461600

Under provisions of the bymiddotlaws of the Transfer Co the Railroad Company and 8 other proprietors are required to conmiddot tribute on an ownership basis to (a) an annual sinking fund for these Notes equal to $41412 payable on or before May 20 of each year and (b) semimiddotannual installments of interest on the Notes

THE ST PAUL UNION DEPOT COMPANY 1 First and Refunding Mortgage Bonds 3Ya Series B due October I 1971 10891000

Guaranteed jointly and severally by the Railroad Company and 7 other proprietors each of which is also obligated to advance its ownership proportion of amounts required for Sinking Fund payments and to pay its proportion based upon use of the interest on the bonds

TRAILER TRAIN COMPANY Conditional Sale Agreements 1736741

The Railroad Companys portion of principal guaranteed based on its proportion of stock ownership-294

TOTAL $111844613

22

ANNUAL REPORT FOR 1960

LONG-TERM DEBT DECEMBER 31 1960

DESCRIPTION DATE OF

ISSUE DATE OF

MATURITY

AMOUNT ORIGINALLY

ISSUED OR ASSUMED

AMOUNT AS OF

DBc 31 1960

AMOUNT HELD BY COMPANY

AMOUNT ACTUALLY

OUTSTANDING RATE PER

CENT

INTEREST

PAYABLB ACCRUED DURING

YBAR First mongage bonds Series A General mortgage income bonds

Series A General mortgage convertible inmiddot

come bonds Series B Five per cent income debentures

Series A The Bedford Belt Ry Co Grsr

mongage bonds The Southern Indiana Ry Co first

mongage bonds Chicago Terre Haute and 5ourbmiddot

eastern Ry Co Firsr and refunding mortgage

bonds Income mortgage bonds

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

I 1944

11944

11944

11955

11946

11946

I 1946 I 1946

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

11994

12019

12044

12055

11994

I 1994

11994 I 1994

$ 59515100

57256600

51422100

60000000

350000

7287000

9571000 6335800

$ 53784300

33905200

34640400

58500000

333000

7236000

9571000 6335800

$ 346300

408500

733100

300000

144000

256000

2051000 1597000

$ 53438000

33496700

33907300

58200000

189000

6980000

7520000 4738800

4

41

41

5

4~

44

4~ 4~

J amp J

April

April

MampS

JA amp J

JA amp J

JA amp J JA amp J

$ 2145645

1513512

1534381

2903400

7961

296938

320161 201133

Eb~ro~)nt obl~gati~~~ ~~ederails 163723218 75220900 75220900 2884166 Totallongmiddotterm debe $415460818 $279526600 $ 5835900 $273690700 $11807297

$100000 pledged undet ChIcago Terre Haute and Southeastern RaIlway Company Fust and refundmg mongage $1515000 pledged under Chicago Milwaukee St Paul and Pacific Railroad Company First mongage

EQUIPMENT OBLIGATIONS DECEMBER 31 1960

INTBRESTDATB OF DATB OF ORIGINAl AMOUNT AMOUNT PRINCIFAL

DESCRIPTION LBASE OR FINAL COST OF ORIGINALLY OUTSTANDING PAYABLB RATE ACCRUBD AGREEMENT MATURITY EQUIPMENT ISSUED DBc 31 1960 DURING 1961 PER PAYABLB DURING

CENT YEARI EQUIPMENT TRUST CERTIFICATES Series HH Apr 11949 Apr 11964 $ 8112742 $ 6060000 $ 1414000 $ 404000 2Ji AampO $ 37260 Series JJ Sept I 1949 Sept 1 1964 7604384 5640000 1504000 376000 2li MampS 34846 Series KK Oct I 1949 Oct 11964 ~026868 4500000 1200000 300000 2~ AampO 30375 Series LL June I 1950 June 1 1965 289514 4650000 1395000 310000 24 J amp D 36038 Series MM Nov 11950 Nov I 1965 7251863 5430000 1810000 362000 2n MampN 48554 Series NN June I 1951 June I 1961 7254678 5300000 265000 265000 2Ya JampD 17776 Series 00 OCt I 1951 Oct 11966 10053530 7500000 3000000 500000 2Ya AampO 93437 Seties PP bull Mar 11952 Mar 11967 3215855 2400000 1040000 160000 2Ya MampS 31817 Series QQ Sept I 1952 Sept 1 1967 5441323 3990000 1862000 266000 3Va MampS 61651 Series RR Jan I 1954 Jan 11969 10379112 7650000 4335000 510000 3Va J ampJ 139454 Series SS July 11954 July 11969 9931620 7800000 4680000 520000 24 J ampJ 132275 Series TT Nov 1 1954 Nov I 1969 9141903 7200000 4320000 480000 2Ya MampN 132250 Series UU Jan 11956 Jan 11971 9655380 7500000 5250000 500000 3raquo J amp J 181407 Series VV (1st Install) Feb I 1957 Feb 11972 3000000 2300000 200000 4 FampA 94667 11745718 Series VV (2nd InSltaII) Feb I 1957 Feb I 1972 6000000 4600000 400000 4Vs F ampA 207084 Series WW Jan 11958 Jan 11973 6814810 5400000 4500000 360000 4gtil J amp J 189338 Series XX Feb I 1959 Feb 11974 7419495 5850000 5265000 390000 41 FampA 242775Series YY (1st Install) Feb I 1960 Feb I 1975 3000000 2900000 200000 4Ya FampA 121878 Series YY (2nd Install) Feb 11960 Feb I 1975 9683950 4650000 4495000 310000 4~ FampA 128844 CONDITIONAL SALE AGREEMENTS

The FitS( National Bank of Chimiddot ca~o Assignee of the Sellers

Paci c Car amp Foundty Co May I 1956 Nov I 1964 1843205 1428400 731357 182916 395 FMAampN 32094First Wisconsin Narional Bank of

Milwaukee and Northwestmiddot ern National Bank of Minneshyapolis Assignees of tbe SeUers

General Motors Corpn (Electro-Motive Div) Feb 25 1953 May 11961 1543977 1155000 80558 80558 3 FMAampN 4594

Fairbanks Motse amp Co July 15 1953 Nov 1 1961 531102 396000 54830 54830 3 FMAampN 2380American Locomotive Co July 15 1953 Nov 1 1961 529935 396000 54830 54830 3 FMAampN 2380Baldwin-LimamiddotHamilton

Corporation July 15 1953 Nov 1 1961 357568 264000 36553 36553 3 FMAampN 1587Seattle-Fitst National Bank Asmiddot

Bai1i~e_~i~Sfa~il~~n Corporation SePt I 1953 Nov 1 1961 357568 264000 36979 36979 335 FMAampN 1791

General Motors Cotpn (Electro-Motive Div) Sept I 1953 Nov 1 1961 1670914 1236000 173128 173128 335 FMAampN 8385

American Locomotive Co Sept I 1953 Feb 11962 529935 396000 69048 55008 335 FMAampN 3135Continental Illinois National Bank

and Ttust Company of Chishycago Assignee of tbe SeUers

Pullman-Srandard Car Manumiddot facturing Co May 11958 Nov I 1973 4920125 4920125 4245616 328008 440 MampN 195836

General American Transpotta tion Corporation May I 1958 Nov I 1973 6165438 6165438 5296389 411029 440 MampN 244862

United States Railway Equipment Co May 11958 Nov 1 1973 570706 570706 494612 38047 440 MampN 22740

General Motors Cotpn Jan 15 1959 Mar I 1974 8680000 8680000 7812000 578666 5 MampS 402656 Total equipment obligations $163723218 $129391669 $75220900 $ 8843)52 $ 2884166

PAYMENTS MATURING IN YEARS ENDING December 31 1961 $ 8843552 December 31 1966 $ 6151751 December 311971 $ 3465751December 31 1962 8108041 December 31 1967 5571751 December 311972 291751December 311963 8101627 December 31 1968 )225751 Decembet 31 1973 bull 2370271Decembet 31 1964 bull 7862066 December 31 1969 4970751 Decembet 31 1974 994335December 311965 6668751 December 31 1970 3715751 December 311975 _ 255000

Total $75220900

23

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

MILES OF ROAD BY STATES DECEMBER 31 1960

ROAD OPERATED

STATE OWNED SOLELY OWNED JOINTLY TRACKAGELEASED TOTALMAIN BRANCH MAIN BRANCH RIGHTS

LiNE LINE LINE LINE

Idaho 11276 11083 9middot11 23270 Illinois 43296 11755 240 14 13231 68536 Indiana 15591 3679 19270 Iowa 119993 51468 08 04 10 6706 178189 Kansas 705 705

Michigan 5782 11978 25 583 18368 Minnesota 75531 35154 503 2270 19410 132868 Missouri 13002 944 1651 15597 Montana 74753 47322 2999 46 125120 Nebraska 562 562

North Dakota 10250 26329 110 36689 South Dakota 104314 69528 173842

31469 47426 2688 5000 20110 106693i~~~~J~n 103928 47228 1634 7051 159841

Total 609185 362950 4383 12056 10 70966 1059550

Includes 97 mile owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contraCt

MILES OF TRACK DECEMBER 31 1960

OWNED OWNED TRACKAGEITEMS LEASED TOTALSOLELY JOINTLY RIGHTS

Miles of Road (First Main Track) Operated 972135 16439 10 70966 1059550 Not operated 362 362

Additional Main Tracks Operated 69332 1424 41 31329 102126 Not operated

Yard Tracks and Sidings Operated 321153 25542 219 47997 394911 Not operated 228 2626 2854

I-----f------f-----middotI-----I----shyTotal operated 1362620 43405 270 150292 1556587

Total not operated 590 2626 3216 I-----f-----Imiddot-----I-----I----shy

Grand Total 1363210 46031 270 150292 1559803

Miles of Road operated includes 97 mile Yard Tracks and Sidings operated includes 124 miles owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contract

24

ill ~ It

I I I i I I I bull II III

ANNUAL REPORT FOR 1960

DETAILED STATEMENT OF RAILWAY OPERATING REVENUES AND EXPENSES

RAILWAY OPERATING REVENUES

1960 1959 INCREASE DECREASE TRANSPORTATION

Freight $189560907 $201536333 middot0 $ 11975426 Passenger 15174969 15282171 107202 Baggage 79806 86066 middot 6260 Parlor and chair car 83476 91957 8481 Mail 9418410 8862116 $ 556294 Express 3030579 3180656 150077 Other passenger-crain 107746 100303 7443 Milk 18260 30216 middot 11956 Switching 5979910 6591066 611156

1------1------1-------1------shyTOTAL TRANSPORTATION REVENUE 223454063 235760884 12306821

INCIDENTAL

Dining and buffet 1521218 1527536 6318 Station crain and boat privileges 57552 56068 1484 Storage-Freight 8015 11196 - 3181 Storage-Baggage 3631 3837 - 206 Demurrage 1240131 1248537 8406 Communication 55650 72541 16891 Rents of buildings and other property 257841 246697 11144 Miscellaneous 461149 507969 middot middot0 46820

TOTAL INCIDENTAL OPERATING REVENUE 3605187 3674381 69194

JOINT FACILITY

Joint facility-Credit 3315646 2620693 694953 Joint facility-Debit (11994) (14133) (2139)

TOTAL JOINT FACILITY OPERATING REVENUE 3303652 2606560 697092

TOTAL RAILWAY OPERATING REVENUE $230362902 $242041825 $ 11678923

( ) Denotes concra items

RAILWAY OPERATING EXPENSES

1960 1959 INCREASE DECREASE MAINTENANCE OF WAY AND STRUCTURES

Superincendence $ 3108012 $ 3388761 $ 280749 Roadway maincenance 2861659 2867371 5712 Tunnels and subways 10889 11354 465 Bridges trestles and culverts 986082 1198575 212493 Ties 1793766 1827106 33340 Rails 592902 894914 302012 Other track material 1336407 1996881 660474 Ballast 217365 408471 middot 191106 Track laying and surfacing Fences snowsheds and signs

6515560 319315

7505265 398716

989705 79401

Station and office buildings 828484 1014046 185562 Roadway buildings 55448 86514 31066 Water stations Fuel stations

12115 26908

21831 16802 $ 10106

9716

Shops and enginehouses 574222 542976 31246

25

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

RAILWAY a PERATING REVENUES AND EXPENSES- CONTINUED RAILWAY OPERATING EXPENSES-CONTINUED

MAINTENANCE OF WAY AND STRUCTURES

Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous StruCtures Road property-Depreciation _ Retiremenes- Road Roadway machines _ Dismantling retired road property Small cools and supplies Removing snow ice and sand Public improvemenes-Maintenance Injuries co persons Insurance Stationery and printing Other expenses Right-of-way expenses Maineaining joint cracks yards and other facilities-Debit Maintaining joint tracks yards and other facilities-Credit

TOTAL MAINTENANCE OF WAY AND STRUCTURES

MAINTENANCE OF EQUIPMENT

Superintendence Shop machinery Power-plant machinery Shop and powerplant machinery-Depreciation Dismantling retired shop and powermiddotplane machinery Other locomotives-Repairs Freight-train cars-Repairs Passenger-train cars-Repairs Work equipment-Repairs Miscellaneous equipment-Repairs Dismantling retired equipment Retirements-Equipment Equipmene- Depreciation Inj uries to persons Insurance Stationery and printing Other expenses Taint maintenance of equipment expenses-Debit Taint maineenance of equipmene expenses-Credit

TOTAL MAINTENANCE OF EQUIPMENT

TRAFFIC

Superintendence Outside agencies Advertising Traffic associations Industrial and immigration bureaus Insurance Stationery and printing Other expenses

1960 1959 INCREASE DECREASE

$ 56714 $ 36447 $ 20267 bullbullbullbullbullbullbull _0 bullbullbullbullbullbull

935578 909129 26449 bullbull 0 bullbullbullbullbullbullbull 0 bullbullbullbullbull

bullbullbullbullbullbull 0 bullbullbullbullbullbull bull bullbull 1838913 1653168 185745 31898 33384 $ 1486 301492 355954 54462 9685 11190 middot 1505 5028247 4953681 74566 197350 241483 44133 706168 892299 186131 107360 148842 middot 41482 780012 825073 45061 841898 1093119 251221 736255 713553 22702 0 326277 442052 115775 50816 46225 4591 71268 87971 16703 419344 470012 50668bull bullbull 0 bullbullbullbullbullbullbullbullbullbull

43266 45762 2496

2725332 2842160 middot 116828

(755037) (550863) (204174) 1------1------1-------1------shy

33691970 37430224 3738254

1716762 1720882 41200 bullbullbullbullbullbullbullbullbullbullbullbullbullbullbull

521695 506499 15196

133941 153222 19281

284088 285333 1245

3681 856 2825

12448450 13197294 748844

9119749 10867539 1747790

2844061 3581261 737200

249163 301007 middot 51844

196990 196551 439

110983 91095 19888

(139163) (764585) (625422)

10468468 10143824 324644

245956 297309 51353

66754 68018 1264

42632 59005 16373

477426 563338 85912

292109 629586 337477

( 35052) (35250) (198)

39048693 41862784 2814091

1853253 1775877 77376

3420570 3680896 260326

641695 669595 27900

316941 281954 34987

50793 58011 7218

991 875 116

267539 246898 20641

29672 34959 5287 1------1------1middot------1------shy

TOTAL TRAFFIC EXPENSES $ 6581454 $ 6749065 $ 167611

( ) Denotes contra items

26

ANNUAL REPORT FOR 1960

RAILWAY OPERATING REVENUES AND EXPENSES-CONCLUDED

RAILWAY OPERATING EXPENSES-CONCLUDED

1960 1959 INCREASE DECREASE TRANSPORTATION

Superintendence $ 2981453 S 2814960 $166493 Dispatching trains 737390 807806 $ 70416 Station employees 12568811 13277513 708702 Weighing inspection and demurrage bureaus 307278 325534 bullbullbullbullbullbull 0 bullbullbullbullbullbullbullbullbull 18256 Station supplies and expenses 1091896 1140062 bullbull 0 bullbullbull 0 bullbullbullbullbullbull 0 bullbull 48166 Yardmasters and yard clerks 3991133 4119498 bullbullbullbullbullbull 0 bullbullbullbullbullbull 0 bullbull 128365 Yard conductors and brakemen 9303622 9647318 343696 Yard swirch and signal tenders 730410 755025 24615 Yard enginemen 6155278 6362440 207162 Yard switching fuel 923737 988987 65250 Yard switching power purchased 11946 15258 bullbull 0 bullbullbullbullbullbullbullbullbullbullbullbullbull 3312 Water for yard locomotives 17360 19948 2588 Lubricants for yard locomotives 83523 109472 25949 Other supplies for yard locomotives Enginehouse expenses-Yard

49721 498339

48817 542983

904

44644

Yard supplies and expenses Operating joint yards and terminals-Debit Operatin~ joint yards and terminals-Credit Train engInemen Train fuel Train power purchased Water for train locomotives

466959 5790981 (683719)

9533667 7243332

864933 94310

441246 5978628 (685475)

9966568 7758783

907295 105164

25713 middot bull bullbull 0 bullbullbullbullbullbullbullbullbullbull 0

middot

187647

(1756) 432901 515451 42362 10854

Lubricants for train locomotives 795622 938600 142978 Other supplies for train locomotives Enginehouse expenses-Train Trainmen

210707 1124921

12091384

202708 1222756

12613963

7999 bullbullbullbull 0 bullbullbullbullbullbullbull bullbullbullbull

97835

522579 Train supplies and expenses 6340264 6660876 320612 Operating sleeping cars 715113 526531 188582 Signal and interlcker operation CrOSSIng protectIOn

1049887

721750 1037947

806370 11940

middot

84620 Drawbridge operation 215086 258082 42996 Communication system operation 1060497 1081772 21275 Operating Boating equipment 11796 10985 811 Srationery and printing 412827 392820 20007 Other expenses 817489 848149 30660 Operating joint tracks and facilities-Debit 1170056 1311393 141337 Operating joint tracks and faciliries-Credir Insurance

(786053)

78437 (751937)

92514 (34116)

14077 Clearing wrecks Damage to property

265853 120728

230128 206210

35725

85482

Damage to live stock on right-of-way Loss and damage-Freight

80817

2795442 53816

2942960 27001

147518 Loss and damage-Baggage 5528 722 4806 Injuries to persons 1708733 1714453 5720

TOTAL TRANSPORTATION EXPENSES 93769244 97849648 4080404

MISCELLANEOUS OPERATIONS Dining and buffet service 2855845 2888241 32396 Operaring joint miscellaneous facilities-Debit 149757 207418 57661

J------J------I-------I------shyTOTAL MISCELLANEOUS OPERATIONS 3005602 3095659 90057

GENBRAL Salaries and expenses of general officers 1421416 1331832 89584 Salaries and expenses of clerks and attendants 6821635 6920559 98924 General office supplies and expenses 753564 727092 26472 Law expenses 831662 811940 19722 Insurance 33708 6002 27706 Pensions and gratuities 818190 917286 99096 Stationery and priming 348137 336267 11870 Valuation expenses 53068 59453 6385 Other expenses 501292 520844 19552 General joint faciliries-Debit 258783 241859 16924 General joint faciliries-Credit (8615) (8933) (318)

TOTAL GENERAL EXPENSES 11832840 11864201 middot 31361

GRAND TOTAL RAILWAY OPERATING EXPENSES $187929803 $198851581 $10921778

( ) Denotes contra items

27

bullbullbull

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

ANALYSIS OF INCREASES AND DECREASES IN TOTAL RAILWAY OPERATING EXPENSES 1960 COMPARED WITH 1959

MAINTENANCE MAINTENANCE TRANSshyITEMS OF WAY AND OP ALL OTHER TOTALPORTATIONSTRUCTURES EQUIPMENT

LABOR General wage increases + $ 360933 + $ 323486 + $1370434 + $ 289045 + $ 2343898 Straight time worked - 2213317 - 2135307 - 4273302 - 680973 - 9302899 Overtime worked - 76922 - 10613 - 163702 9398 - 241839+ Time paid for not worked (incl vacations and holidays) - 100783 - 137170 - 123771 33475 - 323249+

TOTAL LABOR - 2030089 - 1959604 - 3190341 - 344055 - 7524089

FUEL Price middot middot middot - 375791 - 375791 Consumption middot middot middot - 204910 - 204910

TOTAL FUEL middot middot middot middot - 580701 middot - 580701

ELECTRIC POWER middot bullbullbullbullbullbull to middot middot - 45674 middot - 45674

MATERIAL-Ocher than fuel Price + 106251 112344 - 1059 17453 234989 Quanticy - 1181388 - 900335 201128 34210 - 1846385

+ + + + +

TOTAL MATERIAL OTHER THAN FUEL - 1075137 - 787991 200069 51663 - 1611396+ + MISCELLANEOUS

Health and welfare benefits - 38735 - 60626 - 57909 - 15652 - 172922 Other miscellaneous - 624726 - 954691 - 405848 19015 - 1966250+

TOTAL MISCELLANEOUS - 663461 - 1015317 - 463757 3363 - 2139172+ TOTAL LABOR MATERIAL AND MISCELLANEOUS - 3768687 - 3762912 - 4080404 - 289029 - 11901032

DEPRECIATION + 74566 323399 middot + 397965+ middotRETIREMENTS - 44133 625422 middot + 581289+

TOTAL DEPRECIATION AND RETIREMENTS + 30433 948821 middot middot + 979254+ TOTAL RAfLWAY OPERATING EXPENSES - $3738254 - $2814091 - $4080404 289029 - $10921778-I $

RAILWAY OPERATING REVENUES EXPENSES TAXES AND INCOME BY MONTHS FOR THE YEAR ENDED DECEMBER 31 1960

1960

RAILWAY OPERATING REVENUES

RAILWAY OPERATING

EXPENSES

NET REVENUE FROM

RAILWAY OPERATIONS

RAILWAY TAX

ACCRUALS

RAILWAY OPERATING

INCOME

EQUIPMENT RENTS-NET

DR

JOINT FACILITY

RENTS-NET DR

NET RAILWAY OPERATING

INCOME

January $ 17336067 $ 15803272 $ 1532795 $ 1670000 $ (137205) $ 422175 S 231113 $ (790493) February 18493440 15151942 3341498 1673000 1668498 490735 234172 943591 March 19025746 15902966 3122780 1695000 1427780 686903 219282 521595 April bull 18042813 15280563 2762250 1684000 1078250 586443 251268 240539

May 18975935 16148830 2827105 1728000 1099105 824503 181449 93153 June 19011723 16297457 2714266 1727000 987266 803292 217671 (33697) July 18796482 15947748 2848734 1728000 1120734 823376 203289 94069 August 23377375 17022049 6355326 1806000 4549326 1420370 316997 2811959

September 20166066 15953895 4212171 1685000 2527171 1100653 248649 1177869 October 20925500 14736878 6188622 1647000 4541622 980838 252319 3308465 November 18549759 14797644 3752115 1620000 2132115 848876 267507 1015732 December 17661996 14886559 2775437 1474000 1301437 791725 238186 271526

Total $230362902 $187929803 $42433099 $20137000 $22296099 $9779889 $2861902 $9654308

( ) Denotes contra items 28

ANNUAL REPORT FOR 1960

REVENUE FREIGHT TRAFFIC STATISTICS-EXCLUDING TRUCK SERVICE

FREIGHT REVENUE AVERAGE

TONS TONSYEAR HAUL- PERCARRIED MILES PER

MILES TOTAL TON MILETON

(CENTS)

1951 51740580 16732323827 32339 $217832219 $421 1302 1952 49522089 16005309995 32320 222648097 450 1391 1953 46810989 15413226569 32927 215622726 461 1399 1954 43123214 14178678856 32879 197712105 458 1394 1955 45481060 95561748530 34216 205993029 453 1324

1956 45351213 15612344863 34425 209886542 463 1344 1957 42915573 14614118553 34025 212631339 495 1455 1958 40117213 13884510331 34610 205489920 512 1480 1959 40199394 14121939599 35130 201705278 502 1428 1960 38305568 13604642301 35516 189750236 495 1395

REVENUE PASSENGER STATISTICS-EXCLUDING BUS SERVICE

PASSENGER REVENUE AVERAGE

PASSENGERS PASSENGER DISTANCE PER YEAR

CARRIED MILES TRAVELED PER PASSENGER TOTAL

-MILES PASSENGER MILE (CENTS)

OTHER THAN COMMUTATION

1951 3341410 776958568 23252 $ 18484470 $553 2379 1952 3346346 739380708 22095 17569369 525 2376 1953 3158639 658842799 20858 15396026 487 2337 1954 3057733 599281006 19599 13582309 444 2266 1955 3003108 571128913 19018 12413340 413 2173

1956 3266663 696906549 21334 15758692 482 2261 1957 2943819 587947230 19972 14064509 478 2392 1958 2889740 549258597 19007 12969955 449 2361 1959 1839572 523514965 28459 12490275 679 2386 1960 1759253 515650913 29311 12095377 688 2346

CoMMUTATION

1951 4186842 94960045 2268 $ 1251058 $ 30 1317 1952 3899249 89299292 2290 1325955 34 1485 1953 3823231 88929041 2326 1316554 34 1480 1954 3920824 93543801 2386 1374494 35 1469 1955 4176751 98901556 2368 1463125 35 1479

1956 4150616 100135407 2413 1474073 36 1472 1957 4074228 98630820 2421 1463767 36 1484 1958 4338777 103055843 2375 1567002 36 1521 1959 5521115 123694172 2240 2818185 51 2278 1960 5036666 111139202 2207 3095340 61 2785

TOTAL

1951 7528252 871918613 11582 $ 19735528 $252 2263 1952 7245595 828680000 11437 18895324 261 2280 1953 6981870 747771840 10710 16712580 239 2235 1954 1955

6978557 7179859

692824807 670030469

9928 9332

14956803 13876465

214 193

2159 201

1956 7417279 797041956 10746 17232765 232 2162 1957 7018047 686578050 9783 15528276 221 2262 1958 1959 1960

7228517 7360687 6795919

652314440 647209137 626790115

9024 8793 9223

14536957 15308460 15190717

201 208 224

2229 2365 2424

BeglOnmg With year 1959 lOcludes cash fares single and round trip tickets sold for travel within suburban area which in prior yeaTS were included in Other than Commutation

29

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATISTICS OF OPERATIONS

TOTAL TRANSPORTATIONFREIGHT TRAINS PASSENGER TRAlNS SERVICE ITEMS I

1960 1959 1960 1959 1960 1959

RAlL-LINE Average miles of road operared 1 1deg--589_1---1deg586=_-------34-=68 -1-__394-=-9_1-----=10--597-1---I0-594=-

TRAlN MILES

Ordinary (wirh locomorives) 9554242 10152235 6185162 6740403 15739404 16892638 Ligh t (with locomotives) 1_----27--3-59_ 1__-----_24----42-=5_ 1_middot_-----=--------_1 __---c-_o---=-_ 1_--=-2~73-50-9_1_---2442-5_

Total (with locomotives) 9581601 10176660 6185162 6740403 15766763 16917063 Motor car trains bull middotICmiddotmiddotmiddotmiddot~ ----1----=----middotmiddot_1----------1~7-o1_=_60--1-____=_=65--4_8__7+--=-=-1-721-6_0-1-_________65_--487-

Total train miles 1_ __=9 0-58_1--6_deg 1 1__1deg 176--=66_deg--1 60-2_0_23_22_1 __68_0_5 89_deg_1 __15--7_83-923_1 __16--bull98_2-0-550_

LOCOMOTIVE MILES

Principal 9583849 10180397 6185162 6740403 15769011 16920800 Helper 81260 109822 286 726 81546 110548 Lig~t 104438 151874 35078 49266 139516 201140 TraIn sWItchIng 856137 864118 bull bull 856137 864118 Yard switching 1_ __=5-58757--2_1_--=-58---62-=-6-=48=_1 __~4--28-0-54__=31__--441--949-1 __60161_15_1 __630_4--59-=-7

Total locomotive miles 1-162213--2561----=-17-168859=_1---=6649-deg-=69=-1----723-234-4+2=2c862325_1_---=-24401203=_

CAR MILES

Loaded freight cars 431972870 466352092 517228 101495 432490098 466453587 Empty freigh tears I~26624=2gt490_127-=325-=-3~4~594-1------=--5==-- bull6471=-1------=-=-5o-6_01---266--248gt13--1_ 1-27-3gt5-35-154=-

Total loaded and empty freight cars 698215360 739886686 522869 102055 698738229 739988741 Caboose 1~_9285~9235-=-5-1-~1023=2-=-9-651=-1------=_1~--2101------=-~2~1~1=7--1-~9~86-0--5-6--5-1-=-1=_=0--33__1--7--68--

Total freight car miles 17deg8gtdeg742715-1-7502216233~7 1_----=524-079=-1_---=104172_ 1-7deg825982794=-1 _---750-320509=_

Passenger coaches 4913 3974 22864172 23715856 22869085 23719830 Sleeping and parlor cars (Company) 1812568 1817919 1812568 1817919 Sleeping cars (Pullman) 38383 35410 12685592 13337316 12723975 13372726 Club lounge dining and observation cars 547 bull 4989125 5250522 4989672 5250522 Combination passenger and head end cars 501995 659233 169149 142633 671144 801866 Mail express and baggage cars 2570197 2539863 21120653 22269656 23690850 24809519 Business cars 1---=--3-6~66-41--=-=---44---1-5 133-deg82_ 1_-----1--49-=-3deg8_ 1_--16-=-974-=6_1_-----_193---4657-_ 1_----shy

Total passenger car miles I~--=3215226~99-1-__=__3~282=63=__7_1-63-7--7--4~3--41_1--6-6-6-83-21--0+-66--9-2 65--847shy72deg4deg+-=-=-69--9--Grand total car miles 1 7_11 _227--4_1_4_1 753 498-974_1_6_429_84_2deg---1_6_67_8_7--=3_8_2_ 775 525--8--=34_ __8_2deg_2_86--bull356_

1 1

GROSS TON MILES

Locomotives and tenders (thousands) 1_ __=3-3942655-1 __3450-518--1__2--0_4_22_10---1 __21_6--2 1-13_ _---=5 436--865_ __5--612__=6311 1Freight cars contents and cabooses (thousands) 31409774 32603899 23551 4151 31433325 32608050 Passenger cars and contents (thousands) 1---1632517-1---------=-1670109=-1---41deg29-=-95_1--42999-8--4-1---4--26625o-12=-1------4=467o-O973=-

To tal freig ht and passenger (th0 usands) 1 31 57322-911_----32-- 771degdeg8=_1 41_265_46_ 1__4--=30_4 135_1 35--699--8__=37_ ____=_37-- 075_14__=3-shy1

TRAIN HOURS

Train hours in road service 473544 507565 137163 154436 610707 662001

REVENUE AND NONREVENUE FREIGHT TRAFFIC Tons of revenue freight ~8305568 40199394 Tons of nonrevenue freight middot1middotmiddotmiddot--- middotmiddot-=middot1middot---middotmiddotmiddotmiddot--- middotmiddot-1middotmiddot---middot---middotmiddotmiddot--- cl __ __ middot_middotmiddotmiddot1 _=-=-8421=-=35_ 1-------1_=_deg6--deg-53-7shy

Total tons of freight IC--- I~ +bull--- 1 --- ---1 392147-7deg3_1_---=-41=2-59093-1 Net ton miles revenue freight (thousands) 13604642 14121940 Net ton miles nonrevenue freight (thousands) middot1-middotmiddot--middot-middot=~-c- -1-------------middot1middotc----c_c I_____--_middot~middot-middotmiddotI_=-=---25797-5179c+----=-3_=_81c-0=-36--

Total net ton miles of freigh t (thousands) 1_c138530726=_1----=-145021~3=-301--104~35 _1 1646_1-1386421611----=-145deg2976

REVENUE PASSENGER TRAFFIC

Passengers carried 6795919 7360687 Passenger miles 626790115 647209137

MOTOR VEHICLE OPERATIONS EXCLUDED ABOVE Net ton miles revenue freight (thousands) 1124 1318 Passengers carried 995 1914 Passenger miles 1041447 991687

30

ANNUAL REPORT FOR 1960

STATISTICS OF OPERATIONS-CONCLUDED

-ITEMS 1960 1959 1958 1957 1956 1955

FREIGHT TRAIN STATISTICS AND AVERAGES

Gross ton miles trailing (thousands) 31573291 32771008 32413288 34236747 36203655 36228284

Eastbound 17124676 18176737 18125895 18805435 19734331 19787705 Westbound 14448615 14594271 14287393 15431312 16469324 16440579

Steam middot middot 135 133258 Dieselmiddotelectric 29107869 29901296 29705585 31129417 32597742 32536016 Electric 2465422 2869712 2707703 3107330 3605778 3559010

Per cent steam - middot 4 Per cent Dieselmiddotelectric 922 912 916 909 900 898 Per cent electric 78 88 84 91 100 98

Loaded freight cars per train 452 459 443 443 446 434 Empty freigh t cars per train 279 270 277 267 247 235

Total freight cars per train 731 729 720 710 693 669

Gross tons per train - 3305 3228 3157 3117 3070 2969 Net tons per train 1450 1428 1390 1373 1370 1323 Net tons per loaded car 321 311 313 310 307 305 Miles per car per day (serviceable freight) 393 390 357 370 387 377 Net ton miles per freight car-day 736 734 655 673 715 702 Train speed (train miles per train hour) 202 200 196 192 191 190 Gross ton miles (trailing) per train hour 66674 64565 61714 59780 58328 56315

PASSENGER TRAIN STATISTICS AND AVERAGES

Passenger car miles (excluding motor) - 64230016 66525240 69087808 75256765 86613202 72582117

Steam middot 13184 16967 Dieselmiddotelectric 64227781 66502614 65218200 71665998 81157901 66905429 Electric 2235 22626 3869608 3590767 5442117 5659721

Per cent steam middot Per cent Diesel-electric 1000 1000 944 952 937 922 Per cent electric middot 56 48 63 78

Cars per train (excluding motor) 1038 987 960 960 984 891 Revenue passengers per train 1012 952 898 865 894 812 Revenue passengers per car 166 165 161 160 168 175 Train speed (train miles per train hour) 452 441 444 439 447 429

YARD SWITCHINGSTATISTICS

Yard switching hours 1002686 1Oi0766 1063803 1184130 1251620 1274248

Steam middot 7 11279 Dieselmiddotelectric 994370 1038534 1056660 1174874 1235025 1246748 Electric 8316 12232 7143 9256 16588 16221

Per cent steam middot middot 9 Per cent Dieselmiddotelectric 992 988 993 992 987 978 Per cent electric 8 12 7 8 13 13

DENSITY STATISTICS

Per mile of road per day (freight service) Train miles ordinary Net ton miles

Per mile of road per day (passenger service) Train miles Car miles

25 3575

49 507

26 3753

47 463

27 3694

48 455

28 3896

47 450

30 4153

53 517

31 4161

48 425

31

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

REVENUE FREIGHT BY PRINCIPAL COMMODITIES-1960 AND 1959

INCREASE + OR1960 1959 DECREASE shyCOMMODITIES

TONS CARRIED

PERCENT OF TOTAL

TONS CARRIED

PERCENT OF TOTAL TONS PERCENT

PRODUCTS OF AGRICULTURE Wheat Corn Batley and tye Oats shy

Flour meal and mill products Citrus fruits Other fruits fresh and frozen

1708445 1325050

763672 347413

1275613 39049

123945

45 35 20

9 33

1

3

1653685 1281473

738948 298327

1242503 59289

135892

41 32 18 7

31 2 3

+ + + + + --

54760 43577 24724 49086 33110 20240 11947

33 34 33

165 27

341 88

Potatoes other than sweet 0 0 bull 229982 6 264312 7 - 34330 130 Other vegetables fresh and frozen Sugar beets Other products of agriculture

115520 213813

1588516

3

6 41

126388 191132

1480059

3

5 37

-+ +

10868 22681

108457

86 119

73 Total 7731018 202 7472008 186 + 259010 35

ANIMALS AND PRODUCTS Cattle calves sheep and goats 171861 4 198623 5 - 26762 135 Swine 21999 1 33892 1 - 11893 351 Fresh meats 386670 10 427610 10 - 40940 96 Poultry eggs butter and cheese 113551 3 128422 3 - 14871 116 Wool hides and leather 153604 4 161264 4 - 7660 47 Other animals and products 268968 7 265237 7 + 3731 14

Total 1116653 29 1215048 30 - 98395 81

PRODUCTS OF MINES Bituminous coal 4862060 127 5447866 136 - 585806 108 Coke 257305 6 296121 7 - 38816 131 Ores and concentrates Gravel and sand

462461 916755

12 24

385162 1166550

10 29

+ -

77299 249795

201 214

Stone broken ground or crushed Stone rough and finished Asphalt

1291164 77997

195521

34 2 5

1192897 71099

234070

30 2 6

+ + -

98267 6898

38549

82 97

165 Salt 148276 4 165384 4 - 17108 103 Other products of miles 1138894 30 1154731 28 - 15837 14

Total 9350433 244 10113880 252 - 763447 75

PRODUCTS OF FORESTS Logs posts poles and cordwood 1290191 34 1604736 40 - 314545 196 Pulpwood 1028793 27 966773 24 + 62020 64 Lumber and mill products 1845337 48 2434155 61 - 588818 242 Veneer and builtup wood 467827 12 520054 13 - 52227 100 Other products of forests 376413 10 259064 6 + 117349 453

Total 5008561 131 5784782 144 - 776221 134

MANUFACTURES AND MISCELLANEOUS Refined ~etroleum and products 1175165 31 1258601 31 - 83436 66 Sugar ta Ie syrups and molasses Iron and steellroducts

304542 2251993

8 59

293861 2299049

7 57

+ -

10681 47056

36 20

Machinery an boilers 222962 6 230072 6 - 7110 31 Cement Brick building tile and artificial stone

1242018 191608

32 5

1152635 199113

29 5

+ -

89383 7505

78 38

lime and plaster 73696 2 81785 2 - 8089 99 Agricultural implements traCtors and parts 155626 4 206217 5 - 50591 245 Autos trucks parts and tires Beverages

745090 599592

19 16

685152 613561

17 15

+ -

59938 13969

87 23

Ice 32950 1 31716 1 + 1234 39 Fertilizers Paper and paper products

590481 1191363

15 31

535770 1200754

13 30

+ -

54711 9391

102 8

Canned food Jroducts 985346 26 997315 25 - 11969 12 Scrap iron an scrap steel 598594 15 758925 19 - 160331 211 Building paper roofing and woodwork 434465 11 460040 12 - 25575 56 Other manufactures and miscellaneous 4165926 109 4435508 110 - 269582 61

Total 14961417 390 15440074 384 - 478657 31

GRAND TOTAL CARLOAD TRAFFIC 38168082 996 40025792 996 - 1857710 46

ALL lCl FREIGHT 137486 4 173602 4 - 36116 208

GRAND TOTAL CARLOAD AND lCi TRAFFIC 38305568 1000 40199394 1000 - 1893826 47

32

ANNUAL REPORT FOR 1960

NUMBER OF EMPLOYEES AND COMPENSATION

REGULAR EMPLOYEES TOTAL COMPENSATION ALL EMPLOYEES PART TIME

EMPLOYEES CHARGED ToAVERAGE CoMPENSATION

YEAR Noop

EMPLOYEES (MIDDLE

OP MONTH COUNT)

CoMPENSATION

AVERAGE COMPENSATION

PER EMPLOYEE

(NOT SUBJECT TO

CONTINUING AUTHORITY

OP RAILROAD)

TOTAL COMPENSATION OPERATING

EXPENSES

ADDITIONS AND

BETTERMENTS AND OTHER ACCOUNTS

1928 48129 $ 81744769 $1698 $135855 $ 81880624 $ 75548543 $ 6332081 1933 26493 39042823 1474 129469 39172292 36740362 2431930 1938 28988 52830262 1822 100092 52930354 48224635 4705719 1943 35377 90305409 2553 145093 90450502 84109945 6340557 1948 38268 138490345 3619 172016 138662361 126543269 12119092 1950 33668 128201025 3808 167342 128368367 121226784 7141583 1951 33846 143260363 4233 219693 143480056 134493624 8986432 1952 32550 145397263 4467 149515 145546778 138390501 7156277 1953 31138 138117562 4436 145500 138263062 131304863 6958199 1954 27961 126272397 4516 143400 126415797 120564532 5851265 1955 27936 126447937 4526 139330 126587267 120732130 5855137 1956 27408 134534522 4909 123452 134657974 126936601 7721373 1957 26007 133239878 5123 117455 133357333 125221025 8136308 1958 23402 128237334 5480 119269 128356603 123103272 5253331 1959 middotmiddot 22243 128292584 5767 107083 128399667 122031078 6368589 1960 20229 121037664 5983 98143 121135807 114993442 6142365

NUMBER OF EMPLOYEES AND COMPENSATION BY STATES

REGULAR EMPLOYEES PART TIME TOTAL

AVERAGE EMPLOYEES COMPENSATIONSTATE

AVERAGE TOTAL CoMPENSATION TOTAL ALL NUMBER COMPENSATION PER COMPENSATION EMPLOYEES

EMPLOYEE

Illinois bull 5977 $ 35954281 $6015 $18179 $ 35972460 Iowa 2062 12410458 6019 5105 12415563 Wisconsin bull 5272 30334008 5754 21200 30355208 Minnesota 2446 14392068 5884 8726 14400794

122 906621 7431 0 906621~~~~~fmiddotmiddotmiddotmiddotmiddot 346 2035311 5882 10780 2046091 Indiana 289 1726773 5975 9180 1735953 South Dakota 902 5244002 5814 180 5244182 North Dakota bullbull 98 524782 5355 2599 527381 Moncana bull 1060 6740641 6359 22074 6762715 Idaho 94 574143 6108 0 574143 Washington 1412 9145616 6477 120 9145736 All otherbullbullbullbullbull 149 1048960 7040 0 1048960

Total 20229 $121037664 $5983 $98143 $121135807

TOTAL PAYROLLS AND COMPANY CONTRIBUTIONS AVERAGE PER EMPLOYEE

COMPANY CoNTRIBUTIONS STRAIGHT TIME RATETOTAL AVERAGE

PAYROLLSshyYEAR RETIREMENT AND HEALTH AND TOTAL PER AVERAGE INCREGULAR

UNEMPLOYMENT WELPARE EMPLOYEE PER OVEREMPLOYEES TAXES BENEFITS HOUR 1939

1950 $128201025 $7234363 $135435388 $4023 $1580 1179 1951 143260363 7774582 151034945 4463 1754 1419 1952 145397263 7696578 153093841 4703 1852 1554 1953 138117562 7441326 145558888 4675 1895 1614 1954 126272397 7035232 133307629 4768 1945 1683 1955 126447937 7276300 $ 624381 134348618 4809 1959 1702 1956 134534522 8581092 1403449 144519063 5273 2130 1938 1957 133239878 8692650 2106181 144038709 5538 2290 2159 1958 128237334 8420346 1934613 138592293 5922 2465 2400 1959 128292584 9894538 1819163 140006285 6294 2566 2539 1960 121037664 9969699 1646241 132653604 6558 2638 2639

33

ANNUAL REPORT FOR 1960

LONG-TERM DEBT DECEMBER 31 1960

DESCRIPTION DATE OF

ISSUE DATE OF

MATURITY

AMOUNT ORIGINALLY

ISSUED OR ASSUMED

AMOUNT AS OF

DBc 31 1960

AMOUNT HELD BY COMPANY

AMOUNT ACTUALLY

OUTSTANDING RATE PER

CENT

INTEREST

PAYABLB ACCRUED DURING

YBAR First mongage bonds Series A General mortgage income bonds

Series A General mortgage convertible inmiddot

come bonds Series B Five per cent income debentures

Series A The Bedford Belt Ry Co Grsr

mongage bonds The Southern Indiana Ry Co first

mongage bonds Chicago Terre Haute and 5ourbmiddot

eastern Ry Co Firsr and refunding mortgage

bonds Income mortgage bonds

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

I 1944

11944

11944

11955

11946

11946

I 1946 I 1946

Jan

Jan

Jan

Jan

Jan

Jan

Jan Jan

11994

12019

12044

12055

11994

I 1994

11994 I 1994

$ 59515100

57256600

51422100

60000000

350000

7287000

9571000 6335800

$ 53784300

33905200

34640400

58500000

333000

7236000

9571000 6335800

$ 346300

408500

733100

300000

144000

256000

2051000 1597000

$ 53438000

33496700

33907300

58200000

189000

6980000

7520000 4738800

4

41

41

5

4~

44

4~ 4~

J amp J

April

April

MampS

JA amp J

JA amp J

JA amp J JA amp J

$ 2145645

1513512

1534381

2903400

7961

296938

320161 201133

Eb~ro~)nt obl~gati~~~ ~~ederails 163723218 75220900 75220900 2884166 Totallongmiddotterm debe $415460818 $279526600 $ 5835900 $273690700 $11807297

$100000 pledged undet ChIcago Terre Haute and Southeastern RaIlway Company Fust and refundmg mongage $1515000 pledged under Chicago Milwaukee St Paul and Pacific Railroad Company First mongage

EQUIPMENT OBLIGATIONS DECEMBER 31 1960

INTBRESTDATB OF DATB OF ORIGINAl AMOUNT AMOUNT PRINCIFAL

DESCRIPTION LBASE OR FINAL COST OF ORIGINALLY OUTSTANDING PAYABLB RATE ACCRUBD AGREEMENT MATURITY EQUIPMENT ISSUED DBc 31 1960 DURING 1961 PER PAYABLB DURING

CENT YEARI EQUIPMENT TRUST CERTIFICATES Series HH Apr 11949 Apr 11964 $ 8112742 $ 6060000 $ 1414000 $ 404000 2Ji AampO $ 37260 Series JJ Sept I 1949 Sept 1 1964 7604384 5640000 1504000 376000 2li MampS 34846 Series KK Oct I 1949 Oct 11964 ~026868 4500000 1200000 300000 2~ AampO 30375 Series LL June I 1950 June 1 1965 289514 4650000 1395000 310000 24 J amp D 36038 Series MM Nov 11950 Nov I 1965 7251863 5430000 1810000 362000 2n MampN 48554 Series NN June I 1951 June I 1961 7254678 5300000 265000 265000 2Ya JampD 17776 Series 00 OCt I 1951 Oct 11966 10053530 7500000 3000000 500000 2Ya AampO 93437 Seties PP bull Mar 11952 Mar 11967 3215855 2400000 1040000 160000 2Ya MampS 31817 Series QQ Sept I 1952 Sept 1 1967 5441323 3990000 1862000 266000 3Va MampS 61651 Series RR Jan I 1954 Jan 11969 10379112 7650000 4335000 510000 3Va J ampJ 139454 Series SS July 11954 July 11969 9931620 7800000 4680000 520000 24 J ampJ 132275 Series TT Nov 1 1954 Nov I 1969 9141903 7200000 4320000 480000 2Ya MampN 132250 Series UU Jan 11956 Jan 11971 9655380 7500000 5250000 500000 3raquo J amp J 181407 Series VV (1st Install) Feb I 1957 Feb 11972 3000000 2300000 200000 4 FampA 94667 11745718 Series VV (2nd InSltaII) Feb I 1957 Feb I 1972 6000000 4600000 400000 4Vs F ampA 207084 Series WW Jan 11958 Jan 11973 6814810 5400000 4500000 360000 4gtil J amp J 189338 Series XX Feb I 1959 Feb 11974 7419495 5850000 5265000 390000 41 FampA 242775Series YY (1st Install) Feb I 1960 Feb I 1975 3000000 2900000 200000 4Ya FampA 121878 Series YY (2nd Install) Feb 11960 Feb I 1975 9683950 4650000 4495000 310000 4~ FampA 128844 CONDITIONAL SALE AGREEMENTS

The FitS( National Bank of Chimiddot ca~o Assignee of the Sellers

Paci c Car amp Foundty Co May I 1956 Nov I 1964 1843205 1428400 731357 182916 395 FMAampN 32094First Wisconsin Narional Bank of

Milwaukee and Northwestmiddot ern National Bank of Minneshyapolis Assignees of tbe SeUers

General Motors Corpn (Electro-Motive Div) Feb 25 1953 May 11961 1543977 1155000 80558 80558 3 FMAampN 4594

Fairbanks Motse amp Co July 15 1953 Nov 1 1961 531102 396000 54830 54830 3 FMAampN 2380American Locomotive Co July 15 1953 Nov 1 1961 529935 396000 54830 54830 3 FMAampN 2380Baldwin-LimamiddotHamilton

Corporation July 15 1953 Nov 1 1961 357568 264000 36553 36553 3 FMAampN 1587Seattle-Fitst National Bank Asmiddot

Bai1i~e_~i~Sfa~il~~n Corporation SePt I 1953 Nov 1 1961 357568 264000 36979 36979 335 FMAampN 1791

General Motors Cotpn (Electro-Motive Div) Sept I 1953 Nov 1 1961 1670914 1236000 173128 173128 335 FMAampN 8385

American Locomotive Co Sept I 1953 Feb 11962 529935 396000 69048 55008 335 FMAampN 3135Continental Illinois National Bank

and Ttust Company of Chishycago Assignee of tbe SeUers

Pullman-Srandard Car Manumiddot facturing Co May 11958 Nov I 1973 4920125 4920125 4245616 328008 440 MampN 195836

General American Transpotta tion Corporation May I 1958 Nov I 1973 6165438 6165438 5296389 411029 440 MampN 244862

United States Railway Equipment Co May 11958 Nov 1 1973 570706 570706 494612 38047 440 MampN 22740

General Motors Cotpn Jan 15 1959 Mar I 1974 8680000 8680000 7812000 578666 5 MampS 402656 Total equipment obligations $163723218 $129391669 $75220900 $ 8843)52 $ 2884166

PAYMENTS MATURING IN YEARS ENDING December 31 1961 $ 8843552 December 31 1966 $ 6151751 December 311971 $ 3465751December 31 1962 8108041 December 31 1967 5571751 December 311972 291751December 311963 8101627 December 31 1968 )225751 Decembet 31 1973 bull 2370271Decembet 31 1964 bull 7862066 December 31 1969 4970751 Decembet 31 1974 994335December 311965 6668751 December 31 1970 3715751 December 311975 _ 255000

Total $75220900

23

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

MILES OF ROAD BY STATES DECEMBER 31 1960

ROAD OPERATED

STATE OWNED SOLELY OWNED JOINTLY TRACKAGELEASED TOTALMAIN BRANCH MAIN BRANCH RIGHTS

LiNE LINE LINE LINE

Idaho 11276 11083 9middot11 23270 Illinois 43296 11755 240 14 13231 68536 Indiana 15591 3679 19270 Iowa 119993 51468 08 04 10 6706 178189 Kansas 705 705

Michigan 5782 11978 25 583 18368 Minnesota 75531 35154 503 2270 19410 132868 Missouri 13002 944 1651 15597 Montana 74753 47322 2999 46 125120 Nebraska 562 562

North Dakota 10250 26329 110 36689 South Dakota 104314 69528 173842

31469 47426 2688 5000 20110 106693i~~~~J~n 103928 47228 1634 7051 159841

Total 609185 362950 4383 12056 10 70966 1059550

Includes 97 mile owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contraCt

MILES OF TRACK DECEMBER 31 1960

OWNED OWNED TRACKAGEITEMS LEASED TOTALSOLELY JOINTLY RIGHTS

Miles of Road (First Main Track) Operated 972135 16439 10 70966 1059550 Not operated 362 362

Additional Main Tracks Operated 69332 1424 41 31329 102126 Not operated

Yard Tracks and Sidings Operated 321153 25542 219 47997 394911 Not operated 228 2626 2854

I-----f------f-----middotI-----I----shyTotal operated 1362620 43405 270 150292 1556587

Total not operated 590 2626 3216 I-----f-----Imiddot-----I-----I----shy

Grand Total 1363210 46031 270 150292 1559803

Miles of Road operated includes 97 mile Yard Tracks and Sidings operated includes 124 miles owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contract

24

ill ~ It

I I I i I I I bull II III

ANNUAL REPORT FOR 1960

DETAILED STATEMENT OF RAILWAY OPERATING REVENUES AND EXPENSES

RAILWAY OPERATING REVENUES

1960 1959 INCREASE DECREASE TRANSPORTATION

Freight $189560907 $201536333 middot0 $ 11975426 Passenger 15174969 15282171 107202 Baggage 79806 86066 middot 6260 Parlor and chair car 83476 91957 8481 Mail 9418410 8862116 $ 556294 Express 3030579 3180656 150077 Other passenger-crain 107746 100303 7443 Milk 18260 30216 middot 11956 Switching 5979910 6591066 611156

1------1------1-------1------shyTOTAL TRANSPORTATION REVENUE 223454063 235760884 12306821

INCIDENTAL

Dining and buffet 1521218 1527536 6318 Station crain and boat privileges 57552 56068 1484 Storage-Freight 8015 11196 - 3181 Storage-Baggage 3631 3837 - 206 Demurrage 1240131 1248537 8406 Communication 55650 72541 16891 Rents of buildings and other property 257841 246697 11144 Miscellaneous 461149 507969 middot middot0 46820

TOTAL INCIDENTAL OPERATING REVENUE 3605187 3674381 69194

JOINT FACILITY

Joint facility-Credit 3315646 2620693 694953 Joint facility-Debit (11994) (14133) (2139)

TOTAL JOINT FACILITY OPERATING REVENUE 3303652 2606560 697092

TOTAL RAILWAY OPERATING REVENUE $230362902 $242041825 $ 11678923

( ) Denotes concra items

RAILWAY OPERATING EXPENSES

1960 1959 INCREASE DECREASE MAINTENANCE OF WAY AND STRUCTURES

Superincendence $ 3108012 $ 3388761 $ 280749 Roadway maincenance 2861659 2867371 5712 Tunnels and subways 10889 11354 465 Bridges trestles and culverts 986082 1198575 212493 Ties 1793766 1827106 33340 Rails 592902 894914 302012 Other track material 1336407 1996881 660474 Ballast 217365 408471 middot 191106 Track laying and surfacing Fences snowsheds and signs

6515560 319315

7505265 398716

989705 79401

Station and office buildings 828484 1014046 185562 Roadway buildings 55448 86514 31066 Water stations Fuel stations

12115 26908

21831 16802 $ 10106

9716

Shops and enginehouses 574222 542976 31246

25

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

RAILWAY a PERATING REVENUES AND EXPENSES- CONTINUED RAILWAY OPERATING EXPENSES-CONTINUED

MAINTENANCE OF WAY AND STRUCTURES

Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous StruCtures Road property-Depreciation _ Retiremenes- Road Roadway machines _ Dismantling retired road property Small cools and supplies Removing snow ice and sand Public improvemenes-Maintenance Injuries co persons Insurance Stationery and printing Other expenses Right-of-way expenses Maineaining joint cracks yards and other facilities-Debit Maintaining joint tracks yards and other facilities-Credit

TOTAL MAINTENANCE OF WAY AND STRUCTURES

MAINTENANCE OF EQUIPMENT

Superintendence Shop machinery Power-plant machinery Shop and powerplant machinery-Depreciation Dismantling retired shop and powermiddotplane machinery Other locomotives-Repairs Freight-train cars-Repairs Passenger-train cars-Repairs Work equipment-Repairs Miscellaneous equipment-Repairs Dismantling retired equipment Retirements-Equipment Equipmene- Depreciation Inj uries to persons Insurance Stationery and printing Other expenses Taint maintenance of equipment expenses-Debit Taint maineenance of equipmene expenses-Credit

TOTAL MAINTENANCE OF EQUIPMENT

TRAFFIC

Superintendence Outside agencies Advertising Traffic associations Industrial and immigration bureaus Insurance Stationery and printing Other expenses

1960 1959 INCREASE DECREASE

$ 56714 $ 36447 $ 20267 bullbullbullbullbullbullbull _0 bullbullbullbullbullbull

935578 909129 26449 bullbull 0 bullbullbullbullbullbullbull 0 bullbullbullbullbull

bullbullbullbullbullbull 0 bullbullbullbullbullbull bull bullbull 1838913 1653168 185745 31898 33384 $ 1486 301492 355954 54462 9685 11190 middot 1505 5028247 4953681 74566 197350 241483 44133 706168 892299 186131 107360 148842 middot 41482 780012 825073 45061 841898 1093119 251221 736255 713553 22702 0 326277 442052 115775 50816 46225 4591 71268 87971 16703 419344 470012 50668bull bullbull 0 bullbullbullbullbullbullbullbullbullbull

43266 45762 2496

2725332 2842160 middot 116828

(755037) (550863) (204174) 1------1------1-------1------shy

33691970 37430224 3738254

1716762 1720882 41200 bullbullbullbullbullbullbullbullbullbullbullbullbullbullbull

521695 506499 15196

133941 153222 19281

284088 285333 1245

3681 856 2825

12448450 13197294 748844

9119749 10867539 1747790

2844061 3581261 737200

249163 301007 middot 51844

196990 196551 439

110983 91095 19888

(139163) (764585) (625422)

10468468 10143824 324644

245956 297309 51353

66754 68018 1264

42632 59005 16373

477426 563338 85912

292109 629586 337477

( 35052) (35250) (198)

39048693 41862784 2814091

1853253 1775877 77376

3420570 3680896 260326

641695 669595 27900

316941 281954 34987

50793 58011 7218

991 875 116

267539 246898 20641

29672 34959 5287 1------1------1middot------1------shy

TOTAL TRAFFIC EXPENSES $ 6581454 $ 6749065 $ 167611

( ) Denotes contra items

26

ANNUAL REPORT FOR 1960

RAILWAY OPERATING REVENUES AND EXPENSES-CONCLUDED

RAILWAY OPERATING EXPENSES-CONCLUDED

1960 1959 INCREASE DECREASE TRANSPORTATION

Superintendence $ 2981453 S 2814960 $166493 Dispatching trains 737390 807806 $ 70416 Station employees 12568811 13277513 708702 Weighing inspection and demurrage bureaus 307278 325534 bullbullbullbullbullbull 0 bullbullbullbullbullbullbullbullbull 18256 Station supplies and expenses 1091896 1140062 bullbull 0 bullbullbull 0 bullbullbullbullbullbull 0 bullbull 48166 Yardmasters and yard clerks 3991133 4119498 bullbullbullbullbullbull 0 bullbullbullbullbullbull 0 bullbull 128365 Yard conductors and brakemen 9303622 9647318 343696 Yard swirch and signal tenders 730410 755025 24615 Yard enginemen 6155278 6362440 207162 Yard switching fuel 923737 988987 65250 Yard switching power purchased 11946 15258 bullbull 0 bullbullbullbullbullbullbullbullbullbullbullbullbull 3312 Water for yard locomotives 17360 19948 2588 Lubricants for yard locomotives 83523 109472 25949 Other supplies for yard locomotives Enginehouse expenses-Yard

49721 498339

48817 542983

904

44644

Yard supplies and expenses Operating joint yards and terminals-Debit Operatin~ joint yards and terminals-Credit Train engInemen Train fuel Train power purchased Water for train locomotives

466959 5790981 (683719)

9533667 7243332

864933 94310

441246 5978628 (685475)

9966568 7758783

907295 105164

25713 middot bull bullbull 0 bullbullbullbullbullbullbullbullbullbull 0

middot

187647

(1756) 432901 515451 42362 10854

Lubricants for train locomotives 795622 938600 142978 Other supplies for train locomotives Enginehouse expenses-Train Trainmen

210707 1124921

12091384

202708 1222756

12613963

7999 bullbullbullbull 0 bullbullbullbullbullbullbull bullbullbullbull

97835

522579 Train supplies and expenses 6340264 6660876 320612 Operating sleeping cars 715113 526531 188582 Signal and interlcker operation CrOSSIng protectIOn

1049887

721750 1037947

806370 11940

middot

84620 Drawbridge operation 215086 258082 42996 Communication system operation 1060497 1081772 21275 Operating Boating equipment 11796 10985 811 Srationery and printing 412827 392820 20007 Other expenses 817489 848149 30660 Operating joint tracks and facilities-Debit 1170056 1311393 141337 Operating joint tracks and faciliries-Credir Insurance

(786053)

78437 (751937)

92514 (34116)

14077 Clearing wrecks Damage to property

265853 120728

230128 206210

35725

85482

Damage to live stock on right-of-way Loss and damage-Freight

80817

2795442 53816

2942960 27001

147518 Loss and damage-Baggage 5528 722 4806 Injuries to persons 1708733 1714453 5720

TOTAL TRANSPORTATION EXPENSES 93769244 97849648 4080404

MISCELLANEOUS OPERATIONS Dining and buffet service 2855845 2888241 32396 Operaring joint miscellaneous facilities-Debit 149757 207418 57661

J------J------I-------I------shyTOTAL MISCELLANEOUS OPERATIONS 3005602 3095659 90057

GENBRAL Salaries and expenses of general officers 1421416 1331832 89584 Salaries and expenses of clerks and attendants 6821635 6920559 98924 General office supplies and expenses 753564 727092 26472 Law expenses 831662 811940 19722 Insurance 33708 6002 27706 Pensions and gratuities 818190 917286 99096 Stationery and priming 348137 336267 11870 Valuation expenses 53068 59453 6385 Other expenses 501292 520844 19552 General joint faciliries-Debit 258783 241859 16924 General joint faciliries-Credit (8615) (8933) (318)

TOTAL GENERAL EXPENSES 11832840 11864201 middot 31361

GRAND TOTAL RAILWAY OPERATING EXPENSES $187929803 $198851581 $10921778

( ) Denotes contra items

27

bullbullbull

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

ANALYSIS OF INCREASES AND DECREASES IN TOTAL RAILWAY OPERATING EXPENSES 1960 COMPARED WITH 1959

MAINTENANCE MAINTENANCE TRANSshyITEMS OF WAY AND OP ALL OTHER TOTALPORTATIONSTRUCTURES EQUIPMENT

LABOR General wage increases + $ 360933 + $ 323486 + $1370434 + $ 289045 + $ 2343898 Straight time worked - 2213317 - 2135307 - 4273302 - 680973 - 9302899 Overtime worked - 76922 - 10613 - 163702 9398 - 241839+ Time paid for not worked (incl vacations and holidays) - 100783 - 137170 - 123771 33475 - 323249+

TOTAL LABOR - 2030089 - 1959604 - 3190341 - 344055 - 7524089

FUEL Price middot middot middot - 375791 - 375791 Consumption middot middot middot - 204910 - 204910

TOTAL FUEL middot middot middot middot - 580701 middot - 580701

ELECTRIC POWER middot bullbullbullbullbullbull to middot middot - 45674 middot - 45674

MATERIAL-Ocher than fuel Price + 106251 112344 - 1059 17453 234989 Quanticy - 1181388 - 900335 201128 34210 - 1846385

+ + + + +

TOTAL MATERIAL OTHER THAN FUEL - 1075137 - 787991 200069 51663 - 1611396+ + MISCELLANEOUS

Health and welfare benefits - 38735 - 60626 - 57909 - 15652 - 172922 Other miscellaneous - 624726 - 954691 - 405848 19015 - 1966250+

TOTAL MISCELLANEOUS - 663461 - 1015317 - 463757 3363 - 2139172+ TOTAL LABOR MATERIAL AND MISCELLANEOUS - 3768687 - 3762912 - 4080404 - 289029 - 11901032

DEPRECIATION + 74566 323399 middot + 397965+ middotRETIREMENTS - 44133 625422 middot + 581289+

TOTAL DEPRECIATION AND RETIREMENTS + 30433 948821 middot middot + 979254+ TOTAL RAfLWAY OPERATING EXPENSES - $3738254 - $2814091 - $4080404 289029 - $10921778-I $

RAILWAY OPERATING REVENUES EXPENSES TAXES AND INCOME BY MONTHS FOR THE YEAR ENDED DECEMBER 31 1960

1960

RAILWAY OPERATING REVENUES

RAILWAY OPERATING

EXPENSES

NET REVENUE FROM

RAILWAY OPERATIONS

RAILWAY TAX

ACCRUALS

RAILWAY OPERATING

INCOME

EQUIPMENT RENTS-NET

DR

JOINT FACILITY

RENTS-NET DR

NET RAILWAY OPERATING

INCOME

January $ 17336067 $ 15803272 $ 1532795 $ 1670000 $ (137205) $ 422175 S 231113 $ (790493) February 18493440 15151942 3341498 1673000 1668498 490735 234172 943591 March 19025746 15902966 3122780 1695000 1427780 686903 219282 521595 April bull 18042813 15280563 2762250 1684000 1078250 586443 251268 240539

May 18975935 16148830 2827105 1728000 1099105 824503 181449 93153 June 19011723 16297457 2714266 1727000 987266 803292 217671 (33697) July 18796482 15947748 2848734 1728000 1120734 823376 203289 94069 August 23377375 17022049 6355326 1806000 4549326 1420370 316997 2811959

September 20166066 15953895 4212171 1685000 2527171 1100653 248649 1177869 October 20925500 14736878 6188622 1647000 4541622 980838 252319 3308465 November 18549759 14797644 3752115 1620000 2132115 848876 267507 1015732 December 17661996 14886559 2775437 1474000 1301437 791725 238186 271526

Total $230362902 $187929803 $42433099 $20137000 $22296099 $9779889 $2861902 $9654308

( ) Denotes contra items 28

ANNUAL REPORT FOR 1960

REVENUE FREIGHT TRAFFIC STATISTICS-EXCLUDING TRUCK SERVICE

FREIGHT REVENUE AVERAGE

TONS TONSYEAR HAUL- PERCARRIED MILES PER

MILES TOTAL TON MILETON

(CENTS)

1951 51740580 16732323827 32339 $217832219 $421 1302 1952 49522089 16005309995 32320 222648097 450 1391 1953 46810989 15413226569 32927 215622726 461 1399 1954 43123214 14178678856 32879 197712105 458 1394 1955 45481060 95561748530 34216 205993029 453 1324

1956 45351213 15612344863 34425 209886542 463 1344 1957 42915573 14614118553 34025 212631339 495 1455 1958 40117213 13884510331 34610 205489920 512 1480 1959 40199394 14121939599 35130 201705278 502 1428 1960 38305568 13604642301 35516 189750236 495 1395

REVENUE PASSENGER STATISTICS-EXCLUDING BUS SERVICE

PASSENGER REVENUE AVERAGE

PASSENGERS PASSENGER DISTANCE PER YEAR

CARRIED MILES TRAVELED PER PASSENGER TOTAL

-MILES PASSENGER MILE (CENTS)

OTHER THAN COMMUTATION

1951 3341410 776958568 23252 $ 18484470 $553 2379 1952 3346346 739380708 22095 17569369 525 2376 1953 3158639 658842799 20858 15396026 487 2337 1954 3057733 599281006 19599 13582309 444 2266 1955 3003108 571128913 19018 12413340 413 2173

1956 3266663 696906549 21334 15758692 482 2261 1957 2943819 587947230 19972 14064509 478 2392 1958 2889740 549258597 19007 12969955 449 2361 1959 1839572 523514965 28459 12490275 679 2386 1960 1759253 515650913 29311 12095377 688 2346

CoMMUTATION

1951 4186842 94960045 2268 $ 1251058 $ 30 1317 1952 3899249 89299292 2290 1325955 34 1485 1953 3823231 88929041 2326 1316554 34 1480 1954 3920824 93543801 2386 1374494 35 1469 1955 4176751 98901556 2368 1463125 35 1479

1956 4150616 100135407 2413 1474073 36 1472 1957 4074228 98630820 2421 1463767 36 1484 1958 4338777 103055843 2375 1567002 36 1521 1959 5521115 123694172 2240 2818185 51 2278 1960 5036666 111139202 2207 3095340 61 2785

TOTAL

1951 7528252 871918613 11582 $ 19735528 $252 2263 1952 7245595 828680000 11437 18895324 261 2280 1953 6981870 747771840 10710 16712580 239 2235 1954 1955

6978557 7179859

692824807 670030469

9928 9332

14956803 13876465

214 193

2159 201

1956 7417279 797041956 10746 17232765 232 2162 1957 7018047 686578050 9783 15528276 221 2262 1958 1959 1960

7228517 7360687 6795919

652314440 647209137 626790115

9024 8793 9223

14536957 15308460 15190717

201 208 224

2229 2365 2424

BeglOnmg With year 1959 lOcludes cash fares single and round trip tickets sold for travel within suburban area which in prior yeaTS were included in Other than Commutation

29

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATISTICS OF OPERATIONS

TOTAL TRANSPORTATIONFREIGHT TRAINS PASSENGER TRAlNS SERVICE ITEMS I

1960 1959 1960 1959 1960 1959

RAlL-LINE Average miles of road operared 1 1deg--589_1---1deg586=_-------34-=68 -1-__394-=-9_1-----=10--597-1---I0-594=-

TRAlN MILES

Ordinary (wirh locomorives) 9554242 10152235 6185162 6740403 15739404 16892638 Ligh t (with locomotives) 1_----27--3-59_ 1__-----_24----42-=5_ 1_middot_-----=--------_1 __---c-_o---=-_ 1_--=-2~73-50-9_1_---2442-5_

Total (with locomotives) 9581601 10176660 6185162 6740403 15766763 16917063 Motor car trains bull middotICmiddotmiddotmiddotmiddot~ ----1----=----middotmiddot_1----------1~7-o1_=_60--1-____=_=65--4_8__7+--=-=-1-721-6_0-1-_________65_--487-

Total train miles 1_ __=9 0-58_1--6_deg 1 1__1deg 176--=66_deg--1 60-2_0_23_22_1 __68_0_5 89_deg_1 __15--7_83-923_1 __16--bull98_2-0-550_

LOCOMOTIVE MILES

Principal 9583849 10180397 6185162 6740403 15769011 16920800 Helper 81260 109822 286 726 81546 110548 Lig~t 104438 151874 35078 49266 139516 201140 TraIn sWItchIng 856137 864118 bull bull 856137 864118 Yard switching 1_ __=5-58757--2_1_--=-58---62-=-6-=48=_1 __~4--28-0-54__=31__--441--949-1 __60161_15_1 __630_4--59-=-7

Total locomotive miles 1-162213--2561----=-17-168859=_1---=6649-deg-=69=-1----723-234-4+2=2c862325_1_---=-24401203=_

CAR MILES

Loaded freight cars 431972870 466352092 517228 101495 432490098 466453587 Empty freigh tears I~26624=2gt490_127-=325-=-3~4~594-1------=--5==-- bull6471=-1------=-=-5o-6_01---266--248gt13--1_ 1-27-3gt5-35-154=-

Total loaded and empty freight cars 698215360 739886686 522869 102055 698738229 739988741 Caboose 1~_9285~9235-=-5-1-~1023=2-=-9-651=-1------=_1~--2101------=-~2~1~1=7--1-~9~86-0--5-6--5-1-=-1=_=0--33__1--7--68--

Total freight car miles 17deg8gtdeg742715-1-7502216233~7 1_----=524-079=-1_---=104172_ 1-7deg825982794=-1 _---750-320509=_

Passenger coaches 4913 3974 22864172 23715856 22869085 23719830 Sleeping and parlor cars (Company) 1812568 1817919 1812568 1817919 Sleeping cars (Pullman) 38383 35410 12685592 13337316 12723975 13372726 Club lounge dining and observation cars 547 bull 4989125 5250522 4989672 5250522 Combination passenger and head end cars 501995 659233 169149 142633 671144 801866 Mail express and baggage cars 2570197 2539863 21120653 22269656 23690850 24809519 Business cars 1---=--3-6~66-41--=-=---44---1-5 133-deg82_ 1_-----1--49-=-3deg8_ 1_--16-=-974-=6_1_-----_193---4657-_ 1_----shy

Total passenger car miles I~--=3215226~99-1-__=__3~282=63=__7_1-63-7--7--4~3--41_1--6-6-6-83-21--0+-66--9-2 65--847shy72deg4deg+-=-=-69--9--Grand total car miles 1 7_11 _227--4_1_4_1 753 498-974_1_6_429_84_2deg---1_6_67_8_7--=3_8_2_ 775 525--8--=34_ __8_2deg_2_86--bull356_

1 1

GROSS TON MILES

Locomotives and tenders (thousands) 1_ __=3-3942655-1 __3450-518--1__2--0_4_22_10---1 __21_6--2 1-13_ _---=5 436--865_ __5--612__=6311 1Freight cars contents and cabooses (thousands) 31409774 32603899 23551 4151 31433325 32608050 Passenger cars and contents (thousands) 1---1632517-1---------=-1670109=-1---41deg29-=-95_1--42999-8--4-1---4--26625o-12=-1------4=467o-O973=-

To tal freig ht and passenger (th0 usands) 1 31 57322-911_----32-- 771degdeg8=_1 41_265_46_ 1__4--=30_4 135_1 35--699--8__=37_ ____=_37-- 075_14__=3-shy1

TRAIN HOURS

Train hours in road service 473544 507565 137163 154436 610707 662001

REVENUE AND NONREVENUE FREIGHT TRAFFIC Tons of revenue freight ~8305568 40199394 Tons of nonrevenue freight middot1middotmiddotmiddot--- middotmiddot-=middot1middot---middotmiddotmiddotmiddot--- middotmiddot-1middotmiddot---middot---middotmiddotmiddot--- cl __ __ middot_middotmiddotmiddot1 _=-=-8421=-=35_ 1-------1_=_deg6--deg-53-7shy

Total tons of freight IC--- I~ +bull--- 1 --- ---1 392147-7deg3_1_---=-41=2-59093-1 Net ton miles revenue freight (thousands) 13604642 14121940 Net ton miles nonrevenue freight (thousands) middot1-middotmiddot--middot-middot=~-c- -1-------------middot1middotc----c_c I_____--_middot~middot-middotmiddotI_=-=---25797-5179c+----=-3_=_81c-0=-36--

Total net ton miles of freigh t (thousands) 1_c138530726=_1----=-145021~3=-301--104~35 _1 1646_1-1386421611----=-145deg2976

REVENUE PASSENGER TRAFFIC

Passengers carried 6795919 7360687 Passenger miles 626790115 647209137

MOTOR VEHICLE OPERATIONS EXCLUDED ABOVE Net ton miles revenue freight (thousands) 1124 1318 Passengers carried 995 1914 Passenger miles 1041447 991687

30

ANNUAL REPORT FOR 1960

STATISTICS OF OPERATIONS-CONCLUDED

-ITEMS 1960 1959 1958 1957 1956 1955

FREIGHT TRAIN STATISTICS AND AVERAGES

Gross ton miles trailing (thousands) 31573291 32771008 32413288 34236747 36203655 36228284

Eastbound 17124676 18176737 18125895 18805435 19734331 19787705 Westbound 14448615 14594271 14287393 15431312 16469324 16440579

Steam middot middot 135 133258 Dieselmiddotelectric 29107869 29901296 29705585 31129417 32597742 32536016 Electric 2465422 2869712 2707703 3107330 3605778 3559010

Per cent steam - middot 4 Per cent Dieselmiddotelectric 922 912 916 909 900 898 Per cent electric 78 88 84 91 100 98

Loaded freight cars per train 452 459 443 443 446 434 Empty freigh t cars per train 279 270 277 267 247 235

Total freight cars per train 731 729 720 710 693 669

Gross tons per train - 3305 3228 3157 3117 3070 2969 Net tons per train 1450 1428 1390 1373 1370 1323 Net tons per loaded car 321 311 313 310 307 305 Miles per car per day (serviceable freight) 393 390 357 370 387 377 Net ton miles per freight car-day 736 734 655 673 715 702 Train speed (train miles per train hour) 202 200 196 192 191 190 Gross ton miles (trailing) per train hour 66674 64565 61714 59780 58328 56315

PASSENGER TRAIN STATISTICS AND AVERAGES

Passenger car miles (excluding motor) - 64230016 66525240 69087808 75256765 86613202 72582117

Steam middot 13184 16967 Dieselmiddotelectric 64227781 66502614 65218200 71665998 81157901 66905429 Electric 2235 22626 3869608 3590767 5442117 5659721

Per cent steam middot Per cent Diesel-electric 1000 1000 944 952 937 922 Per cent electric middot 56 48 63 78

Cars per train (excluding motor) 1038 987 960 960 984 891 Revenue passengers per train 1012 952 898 865 894 812 Revenue passengers per car 166 165 161 160 168 175 Train speed (train miles per train hour) 452 441 444 439 447 429

YARD SWITCHINGSTATISTICS

Yard switching hours 1002686 1Oi0766 1063803 1184130 1251620 1274248

Steam middot 7 11279 Dieselmiddotelectric 994370 1038534 1056660 1174874 1235025 1246748 Electric 8316 12232 7143 9256 16588 16221

Per cent steam middot middot 9 Per cent Dieselmiddotelectric 992 988 993 992 987 978 Per cent electric 8 12 7 8 13 13

DENSITY STATISTICS

Per mile of road per day (freight service) Train miles ordinary Net ton miles

Per mile of road per day (passenger service) Train miles Car miles

25 3575

49 507

26 3753

47 463

27 3694

48 455

28 3896

47 450

30 4153

53 517

31 4161

48 425

31

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

REVENUE FREIGHT BY PRINCIPAL COMMODITIES-1960 AND 1959

INCREASE + OR1960 1959 DECREASE shyCOMMODITIES

TONS CARRIED

PERCENT OF TOTAL

TONS CARRIED

PERCENT OF TOTAL TONS PERCENT

PRODUCTS OF AGRICULTURE Wheat Corn Batley and tye Oats shy

Flour meal and mill products Citrus fruits Other fruits fresh and frozen

1708445 1325050

763672 347413

1275613 39049

123945

45 35 20

9 33

1

3

1653685 1281473

738948 298327

1242503 59289

135892

41 32 18 7

31 2 3

+ + + + + --

54760 43577 24724 49086 33110 20240 11947

33 34 33

165 27

341 88

Potatoes other than sweet 0 0 bull 229982 6 264312 7 - 34330 130 Other vegetables fresh and frozen Sugar beets Other products of agriculture

115520 213813

1588516

3

6 41

126388 191132

1480059

3

5 37

-+ +

10868 22681

108457

86 119

73 Total 7731018 202 7472008 186 + 259010 35

ANIMALS AND PRODUCTS Cattle calves sheep and goats 171861 4 198623 5 - 26762 135 Swine 21999 1 33892 1 - 11893 351 Fresh meats 386670 10 427610 10 - 40940 96 Poultry eggs butter and cheese 113551 3 128422 3 - 14871 116 Wool hides and leather 153604 4 161264 4 - 7660 47 Other animals and products 268968 7 265237 7 + 3731 14

Total 1116653 29 1215048 30 - 98395 81

PRODUCTS OF MINES Bituminous coal 4862060 127 5447866 136 - 585806 108 Coke 257305 6 296121 7 - 38816 131 Ores and concentrates Gravel and sand

462461 916755

12 24

385162 1166550

10 29

+ -

77299 249795

201 214

Stone broken ground or crushed Stone rough and finished Asphalt

1291164 77997

195521

34 2 5

1192897 71099

234070

30 2 6

+ + -

98267 6898

38549

82 97

165 Salt 148276 4 165384 4 - 17108 103 Other products of miles 1138894 30 1154731 28 - 15837 14

Total 9350433 244 10113880 252 - 763447 75

PRODUCTS OF FORESTS Logs posts poles and cordwood 1290191 34 1604736 40 - 314545 196 Pulpwood 1028793 27 966773 24 + 62020 64 Lumber and mill products 1845337 48 2434155 61 - 588818 242 Veneer and builtup wood 467827 12 520054 13 - 52227 100 Other products of forests 376413 10 259064 6 + 117349 453

Total 5008561 131 5784782 144 - 776221 134

MANUFACTURES AND MISCELLANEOUS Refined ~etroleum and products 1175165 31 1258601 31 - 83436 66 Sugar ta Ie syrups and molasses Iron and steellroducts

304542 2251993

8 59

293861 2299049

7 57

+ -

10681 47056

36 20

Machinery an boilers 222962 6 230072 6 - 7110 31 Cement Brick building tile and artificial stone

1242018 191608

32 5

1152635 199113

29 5

+ -

89383 7505

78 38

lime and plaster 73696 2 81785 2 - 8089 99 Agricultural implements traCtors and parts 155626 4 206217 5 - 50591 245 Autos trucks parts and tires Beverages

745090 599592

19 16

685152 613561

17 15

+ -

59938 13969

87 23

Ice 32950 1 31716 1 + 1234 39 Fertilizers Paper and paper products

590481 1191363

15 31

535770 1200754

13 30

+ -

54711 9391

102 8

Canned food Jroducts 985346 26 997315 25 - 11969 12 Scrap iron an scrap steel 598594 15 758925 19 - 160331 211 Building paper roofing and woodwork 434465 11 460040 12 - 25575 56 Other manufactures and miscellaneous 4165926 109 4435508 110 - 269582 61

Total 14961417 390 15440074 384 - 478657 31

GRAND TOTAL CARLOAD TRAFFIC 38168082 996 40025792 996 - 1857710 46

ALL lCl FREIGHT 137486 4 173602 4 - 36116 208

GRAND TOTAL CARLOAD AND lCi TRAFFIC 38305568 1000 40199394 1000 - 1893826 47

32

ANNUAL REPORT FOR 1960

NUMBER OF EMPLOYEES AND COMPENSATION

REGULAR EMPLOYEES TOTAL COMPENSATION ALL EMPLOYEES PART TIME

EMPLOYEES CHARGED ToAVERAGE CoMPENSATION

YEAR Noop

EMPLOYEES (MIDDLE

OP MONTH COUNT)

CoMPENSATION

AVERAGE COMPENSATION

PER EMPLOYEE

(NOT SUBJECT TO

CONTINUING AUTHORITY

OP RAILROAD)

TOTAL COMPENSATION OPERATING

EXPENSES

ADDITIONS AND

BETTERMENTS AND OTHER ACCOUNTS

1928 48129 $ 81744769 $1698 $135855 $ 81880624 $ 75548543 $ 6332081 1933 26493 39042823 1474 129469 39172292 36740362 2431930 1938 28988 52830262 1822 100092 52930354 48224635 4705719 1943 35377 90305409 2553 145093 90450502 84109945 6340557 1948 38268 138490345 3619 172016 138662361 126543269 12119092 1950 33668 128201025 3808 167342 128368367 121226784 7141583 1951 33846 143260363 4233 219693 143480056 134493624 8986432 1952 32550 145397263 4467 149515 145546778 138390501 7156277 1953 31138 138117562 4436 145500 138263062 131304863 6958199 1954 27961 126272397 4516 143400 126415797 120564532 5851265 1955 27936 126447937 4526 139330 126587267 120732130 5855137 1956 27408 134534522 4909 123452 134657974 126936601 7721373 1957 26007 133239878 5123 117455 133357333 125221025 8136308 1958 23402 128237334 5480 119269 128356603 123103272 5253331 1959 middotmiddot 22243 128292584 5767 107083 128399667 122031078 6368589 1960 20229 121037664 5983 98143 121135807 114993442 6142365

NUMBER OF EMPLOYEES AND COMPENSATION BY STATES

REGULAR EMPLOYEES PART TIME TOTAL

AVERAGE EMPLOYEES COMPENSATIONSTATE

AVERAGE TOTAL CoMPENSATION TOTAL ALL NUMBER COMPENSATION PER COMPENSATION EMPLOYEES

EMPLOYEE

Illinois bull 5977 $ 35954281 $6015 $18179 $ 35972460 Iowa 2062 12410458 6019 5105 12415563 Wisconsin bull 5272 30334008 5754 21200 30355208 Minnesota 2446 14392068 5884 8726 14400794

122 906621 7431 0 906621~~~~~fmiddotmiddotmiddotmiddotmiddot 346 2035311 5882 10780 2046091 Indiana 289 1726773 5975 9180 1735953 South Dakota 902 5244002 5814 180 5244182 North Dakota bullbull 98 524782 5355 2599 527381 Moncana bull 1060 6740641 6359 22074 6762715 Idaho 94 574143 6108 0 574143 Washington 1412 9145616 6477 120 9145736 All otherbullbullbullbullbull 149 1048960 7040 0 1048960

Total 20229 $121037664 $5983 $98143 $121135807

TOTAL PAYROLLS AND COMPANY CONTRIBUTIONS AVERAGE PER EMPLOYEE

COMPANY CoNTRIBUTIONS STRAIGHT TIME RATETOTAL AVERAGE

PAYROLLSshyYEAR RETIREMENT AND HEALTH AND TOTAL PER AVERAGE INCREGULAR

UNEMPLOYMENT WELPARE EMPLOYEE PER OVEREMPLOYEES TAXES BENEFITS HOUR 1939

1950 $128201025 $7234363 $135435388 $4023 $1580 1179 1951 143260363 7774582 151034945 4463 1754 1419 1952 145397263 7696578 153093841 4703 1852 1554 1953 138117562 7441326 145558888 4675 1895 1614 1954 126272397 7035232 133307629 4768 1945 1683 1955 126447937 7276300 $ 624381 134348618 4809 1959 1702 1956 134534522 8581092 1403449 144519063 5273 2130 1938 1957 133239878 8692650 2106181 144038709 5538 2290 2159 1958 128237334 8420346 1934613 138592293 5922 2465 2400 1959 128292584 9894538 1819163 140006285 6294 2566 2539 1960 121037664 9969699 1646241 132653604 6558 2638 2639

33

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

MILES OF ROAD BY STATES DECEMBER 31 1960

ROAD OPERATED

STATE OWNED SOLELY OWNED JOINTLY TRACKAGELEASED TOTALMAIN BRANCH MAIN BRANCH RIGHTS

LiNE LINE LINE LINE

Idaho 11276 11083 9middot11 23270 Illinois 43296 11755 240 14 13231 68536 Indiana 15591 3679 19270 Iowa 119993 51468 08 04 10 6706 178189 Kansas 705 705

Michigan 5782 11978 25 583 18368 Minnesota 75531 35154 503 2270 19410 132868 Missouri 13002 944 1651 15597 Montana 74753 47322 2999 46 125120 Nebraska 562 562

North Dakota 10250 26329 110 36689 South Dakota 104314 69528 173842

31469 47426 2688 5000 20110 106693i~~~~J~n 103928 47228 1634 7051 159841

Total 609185 362950 4383 12056 10 70966 1059550

Includes 97 mile owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contraCt

MILES OF TRACK DECEMBER 31 1960

OWNED OWNED TRACKAGEITEMS LEASED TOTALSOLELY JOINTLY RIGHTS

Miles of Road (First Main Track) Operated 972135 16439 10 70966 1059550 Not operated 362 362

Additional Main Tracks Operated 69332 1424 41 31329 102126 Not operated

Yard Tracks and Sidings Operated 321153 25542 219 47997 394911 Not operated 228 2626 2854

I-----f------f-----middotI-----I----shyTotal operated 1362620 43405 270 150292 1556587

Total not operated 590 2626 3216 I-----f-----Imiddot-----I-----I----shy

Grand Total 1363210 46031 270 150292 1559803

Miles of Road operated includes 97 mile Yard Tracks and Sidings operated includes 124 miles owned by C M St P amp P R R Co leased to Des Moines Union Ry Co but used by C M St P amp P R R Co under contract

24

ill ~ It

I I I i I I I bull II III

ANNUAL REPORT FOR 1960

DETAILED STATEMENT OF RAILWAY OPERATING REVENUES AND EXPENSES

RAILWAY OPERATING REVENUES

1960 1959 INCREASE DECREASE TRANSPORTATION

Freight $189560907 $201536333 middot0 $ 11975426 Passenger 15174969 15282171 107202 Baggage 79806 86066 middot 6260 Parlor and chair car 83476 91957 8481 Mail 9418410 8862116 $ 556294 Express 3030579 3180656 150077 Other passenger-crain 107746 100303 7443 Milk 18260 30216 middot 11956 Switching 5979910 6591066 611156

1------1------1-------1------shyTOTAL TRANSPORTATION REVENUE 223454063 235760884 12306821

INCIDENTAL

Dining and buffet 1521218 1527536 6318 Station crain and boat privileges 57552 56068 1484 Storage-Freight 8015 11196 - 3181 Storage-Baggage 3631 3837 - 206 Demurrage 1240131 1248537 8406 Communication 55650 72541 16891 Rents of buildings and other property 257841 246697 11144 Miscellaneous 461149 507969 middot middot0 46820

TOTAL INCIDENTAL OPERATING REVENUE 3605187 3674381 69194

JOINT FACILITY

Joint facility-Credit 3315646 2620693 694953 Joint facility-Debit (11994) (14133) (2139)

TOTAL JOINT FACILITY OPERATING REVENUE 3303652 2606560 697092

TOTAL RAILWAY OPERATING REVENUE $230362902 $242041825 $ 11678923

( ) Denotes concra items

RAILWAY OPERATING EXPENSES

1960 1959 INCREASE DECREASE MAINTENANCE OF WAY AND STRUCTURES

Superincendence $ 3108012 $ 3388761 $ 280749 Roadway maincenance 2861659 2867371 5712 Tunnels and subways 10889 11354 465 Bridges trestles and culverts 986082 1198575 212493 Ties 1793766 1827106 33340 Rails 592902 894914 302012 Other track material 1336407 1996881 660474 Ballast 217365 408471 middot 191106 Track laying and surfacing Fences snowsheds and signs

6515560 319315

7505265 398716

989705 79401

Station and office buildings 828484 1014046 185562 Roadway buildings 55448 86514 31066 Water stations Fuel stations

12115 26908

21831 16802 $ 10106

9716

Shops and enginehouses 574222 542976 31246

25

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

RAILWAY a PERATING REVENUES AND EXPENSES- CONTINUED RAILWAY OPERATING EXPENSES-CONTINUED

MAINTENANCE OF WAY AND STRUCTURES

Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous StruCtures Road property-Depreciation _ Retiremenes- Road Roadway machines _ Dismantling retired road property Small cools and supplies Removing snow ice and sand Public improvemenes-Maintenance Injuries co persons Insurance Stationery and printing Other expenses Right-of-way expenses Maineaining joint cracks yards and other facilities-Debit Maintaining joint tracks yards and other facilities-Credit

TOTAL MAINTENANCE OF WAY AND STRUCTURES

MAINTENANCE OF EQUIPMENT

Superintendence Shop machinery Power-plant machinery Shop and powerplant machinery-Depreciation Dismantling retired shop and powermiddotplane machinery Other locomotives-Repairs Freight-train cars-Repairs Passenger-train cars-Repairs Work equipment-Repairs Miscellaneous equipment-Repairs Dismantling retired equipment Retirements-Equipment Equipmene- Depreciation Inj uries to persons Insurance Stationery and printing Other expenses Taint maintenance of equipment expenses-Debit Taint maineenance of equipmene expenses-Credit

TOTAL MAINTENANCE OF EQUIPMENT

TRAFFIC

Superintendence Outside agencies Advertising Traffic associations Industrial and immigration bureaus Insurance Stationery and printing Other expenses

1960 1959 INCREASE DECREASE

$ 56714 $ 36447 $ 20267 bullbullbullbullbullbullbull _0 bullbullbullbullbullbull

935578 909129 26449 bullbull 0 bullbullbullbullbullbullbull 0 bullbullbullbullbull

bullbullbullbullbullbull 0 bullbullbullbullbullbull bull bullbull 1838913 1653168 185745 31898 33384 $ 1486 301492 355954 54462 9685 11190 middot 1505 5028247 4953681 74566 197350 241483 44133 706168 892299 186131 107360 148842 middot 41482 780012 825073 45061 841898 1093119 251221 736255 713553 22702 0 326277 442052 115775 50816 46225 4591 71268 87971 16703 419344 470012 50668bull bullbull 0 bullbullbullbullbullbullbullbullbullbull

43266 45762 2496

2725332 2842160 middot 116828

(755037) (550863) (204174) 1------1------1-------1------shy

33691970 37430224 3738254

1716762 1720882 41200 bullbullbullbullbullbullbullbullbullbullbullbullbullbullbull

521695 506499 15196

133941 153222 19281

284088 285333 1245

3681 856 2825

12448450 13197294 748844

9119749 10867539 1747790

2844061 3581261 737200

249163 301007 middot 51844

196990 196551 439

110983 91095 19888

(139163) (764585) (625422)

10468468 10143824 324644

245956 297309 51353

66754 68018 1264

42632 59005 16373

477426 563338 85912

292109 629586 337477

( 35052) (35250) (198)

39048693 41862784 2814091

1853253 1775877 77376

3420570 3680896 260326

641695 669595 27900

316941 281954 34987

50793 58011 7218

991 875 116

267539 246898 20641

29672 34959 5287 1------1------1middot------1------shy

TOTAL TRAFFIC EXPENSES $ 6581454 $ 6749065 $ 167611

( ) Denotes contra items

26

ANNUAL REPORT FOR 1960

RAILWAY OPERATING REVENUES AND EXPENSES-CONCLUDED

RAILWAY OPERATING EXPENSES-CONCLUDED

1960 1959 INCREASE DECREASE TRANSPORTATION

Superintendence $ 2981453 S 2814960 $166493 Dispatching trains 737390 807806 $ 70416 Station employees 12568811 13277513 708702 Weighing inspection and demurrage bureaus 307278 325534 bullbullbullbullbullbull 0 bullbullbullbullbullbullbullbullbull 18256 Station supplies and expenses 1091896 1140062 bullbull 0 bullbullbull 0 bullbullbullbullbullbull 0 bullbull 48166 Yardmasters and yard clerks 3991133 4119498 bullbullbullbullbullbull 0 bullbullbullbullbullbull 0 bullbull 128365 Yard conductors and brakemen 9303622 9647318 343696 Yard swirch and signal tenders 730410 755025 24615 Yard enginemen 6155278 6362440 207162 Yard switching fuel 923737 988987 65250 Yard switching power purchased 11946 15258 bullbull 0 bullbullbullbullbullbullbullbullbullbullbullbullbull 3312 Water for yard locomotives 17360 19948 2588 Lubricants for yard locomotives 83523 109472 25949 Other supplies for yard locomotives Enginehouse expenses-Yard

49721 498339

48817 542983

904

44644

Yard supplies and expenses Operating joint yards and terminals-Debit Operatin~ joint yards and terminals-Credit Train engInemen Train fuel Train power purchased Water for train locomotives

466959 5790981 (683719)

9533667 7243332

864933 94310

441246 5978628 (685475)

9966568 7758783

907295 105164

25713 middot bull bullbull 0 bullbullbullbullbullbullbullbullbullbull 0

middot

187647

(1756) 432901 515451 42362 10854

Lubricants for train locomotives 795622 938600 142978 Other supplies for train locomotives Enginehouse expenses-Train Trainmen

210707 1124921

12091384

202708 1222756

12613963

7999 bullbullbullbull 0 bullbullbullbullbullbullbull bullbullbullbull

97835

522579 Train supplies and expenses 6340264 6660876 320612 Operating sleeping cars 715113 526531 188582 Signal and interlcker operation CrOSSIng protectIOn

1049887

721750 1037947

806370 11940

middot

84620 Drawbridge operation 215086 258082 42996 Communication system operation 1060497 1081772 21275 Operating Boating equipment 11796 10985 811 Srationery and printing 412827 392820 20007 Other expenses 817489 848149 30660 Operating joint tracks and facilities-Debit 1170056 1311393 141337 Operating joint tracks and faciliries-Credir Insurance

(786053)

78437 (751937)

92514 (34116)

14077 Clearing wrecks Damage to property

265853 120728

230128 206210

35725

85482

Damage to live stock on right-of-way Loss and damage-Freight

80817

2795442 53816

2942960 27001

147518 Loss and damage-Baggage 5528 722 4806 Injuries to persons 1708733 1714453 5720

TOTAL TRANSPORTATION EXPENSES 93769244 97849648 4080404

MISCELLANEOUS OPERATIONS Dining and buffet service 2855845 2888241 32396 Operaring joint miscellaneous facilities-Debit 149757 207418 57661

J------J------I-------I------shyTOTAL MISCELLANEOUS OPERATIONS 3005602 3095659 90057

GENBRAL Salaries and expenses of general officers 1421416 1331832 89584 Salaries and expenses of clerks and attendants 6821635 6920559 98924 General office supplies and expenses 753564 727092 26472 Law expenses 831662 811940 19722 Insurance 33708 6002 27706 Pensions and gratuities 818190 917286 99096 Stationery and priming 348137 336267 11870 Valuation expenses 53068 59453 6385 Other expenses 501292 520844 19552 General joint faciliries-Debit 258783 241859 16924 General joint faciliries-Credit (8615) (8933) (318)

TOTAL GENERAL EXPENSES 11832840 11864201 middot 31361

GRAND TOTAL RAILWAY OPERATING EXPENSES $187929803 $198851581 $10921778

( ) Denotes contra items

27

bullbullbull

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

ANALYSIS OF INCREASES AND DECREASES IN TOTAL RAILWAY OPERATING EXPENSES 1960 COMPARED WITH 1959

MAINTENANCE MAINTENANCE TRANSshyITEMS OF WAY AND OP ALL OTHER TOTALPORTATIONSTRUCTURES EQUIPMENT

LABOR General wage increases + $ 360933 + $ 323486 + $1370434 + $ 289045 + $ 2343898 Straight time worked - 2213317 - 2135307 - 4273302 - 680973 - 9302899 Overtime worked - 76922 - 10613 - 163702 9398 - 241839+ Time paid for not worked (incl vacations and holidays) - 100783 - 137170 - 123771 33475 - 323249+

TOTAL LABOR - 2030089 - 1959604 - 3190341 - 344055 - 7524089

FUEL Price middot middot middot - 375791 - 375791 Consumption middot middot middot - 204910 - 204910

TOTAL FUEL middot middot middot middot - 580701 middot - 580701

ELECTRIC POWER middot bullbullbullbullbullbull to middot middot - 45674 middot - 45674

MATERIAL-Ocher than fuel Price + 106251 112344 - 1059 17453 234989 Quanticy - 1181388 - 900335 201128 34210 - 1846385

+ + + + +

TOTAL MATERIAL OTHER THAN FUEL - 1075137 - 787991 200069 51663 - 1611396+ + MISCELLANEOUS

Health and welfare benefits - 38735 - 60626 - 57909 - 15652 - 172922 Other miscellaneous - 624726 - 954691 - 405848 19015 - 1966250+

TOTAL MISCELLANEOUS - 663461 - 1015317 - 463757 3363 - 2139172+ TOTAL LABOR MATERIAL AND MISCELLANEOUS - 3768687 - 3762912 - 4080404 - 289029 - 11901032

DEPRECIATION + 74566 323399 middot + 397965+ middotRETIREMENTS - 44133 625422 middot + 581289+

TOTAL DEPRECIATION AND RETIREMENTS + 30433 948821 middot middot + 979254+ TOTAL RAfLWAY OPERATING EXPENSES - $3738254 - $2814091 - $4080404 289029 - $10921778-I $

RAILWAY OPERATING REVENUES EXPENSES TAXES AND INCOME BY MONTHS FOR THE YEAR ENDED DECEMBER 31 1960

1960

RAILWAY OPERATING REVENUES

RAILWAY OPERATING

EXPENSES

NET REVENUE FROM

RAILWAY OPERATIONS

RAILWAY TAX

ACCRUALS

RAILWAY OPERATING

INCOME

EQUIPMENT RENTS-NET

DR

JOINT FACILITY

RENTS-NET DR

NET RAILWAY OPERATING

INCOME

January $ 17336067 $ 15803272 $ 1532795 $ 1670000 $ (137205) $ 422175 S 231113 $ (790493) February 18493440 15151942 3341498 1673000 1668498 490735 234172 943591 March 19025746 15902966 3122780 1695000 1427780 686903 219282 521595 April bull 18042813 15280563 2762250 1684000 1078250 586443 251268 240539

May 18975935 16148830 2827105 1728000 1099105 824503 181449 93153 June 19011723 16297457 2714266 1727000 987266 803292 217671 (33697) July 18796482 15947748 2848734 1728000 1120734 823376 203289 94069 August 23377375 17022049 6355326 1806000 4549326 1420370 316997 2811959

September 20166066 15953895 4212171 1685000 2527171 1100653 248649 1177869 October 20925500 14736878 6188622 1647000 4541622 980838 252319 3308465 November 18549759 14797644 3752115 1620000 2132115 848876 267507 1015732 December 17661996 14886559 2775437 1474000 1301437 791725 238186 271526

Total $230362902 $187929803 $42433099 $20137000 $22296099 $9779889 $2861902 $9654308

( ) Denotes contra items 28

ANNUAL REPORT FOR 1960

REVENUE FREIGHT TRAFFIC STATISTICS-EXCLUDING TRUCK SERVICE

FREIGHT REVENUE AVERAGE

TONS TONSYEAR HAUL- PERCARRIED MILES PER

MILES TOTAL TON MILETON

(CENTS)

1951 51740580 16732323827 32339 $217832219 $421 1302 1952 49522089 16005309995 32320 222648097 450 1391 1953 46810989 15413226569 32927 215622726 461 1399 1954 43123214 14178678856 32879 197712105 458 1394 1955 45481060 95561748530 34216 205993029 453 1324

1956 45351213 15612344863 34425 209886542 463 1344 1957 42915573 14614118553 34025 212631339 495 1455 1958 40117213 13884510331 34610 205489920 512 1480 1959 40199394 14121939599 35130 201705278 502 1428 1960 38305568 13604642301 35516 189750236 495 1395

REVENUE PASSENGER STATISTICS-EXCLUDING BUS SERVICE

PASSENGER REVENUE AVERAGE

PASSENGERS PASSENGER DISTANCE PER YEAR

CARRIED MILES TRAVELED PER PASSENGER TOTAL

-MILES PASSENGER MILE (CENTS)

OTHER THAN COMMUTATION

1951 3341410 776958568 23252 $ 18484470 $553 2379 1952 3346346 739380708 22095 17569369 525 2376 1953 3158639 658842799 20858 15396026 487 2337 1954 3057733 599281006 19599 13582309 444 2266 1955 3003108 571128913 19018 12413340 413 2173

1956 3266663 696906549 21334 15758692 482 2261 1957 2943819 587947230 19972 14064509 478 2392 1958 2889740 549258597 19007 12969955 449 2361 1959 1839572 523514965 28459 12490275 679 2386 1960 1759253 515650913 29311 12095377 688 2346

CoMMUTATION

1951 4186842 94960045 2268 $ 1251058 $ 30 1317 1952 3899249 89299292 2290 1325955 34 1485 1953 3823231 88929041 2326 1316554 34 1480 1954 3920824 93543801 2386 1374494 35 1469 1955 4176751 98901556 2368 1463125 35 1479

1956 4150616 100135407 2413 1474073 36 1472 1957 4074228 98630820 2421 1463767 36 1484 1958 4338777 103055843 2375 1567002 36 1521 1959 5521115 123694172 2240 2818185 51 2278 1960 5036666 111139202 2207 3095340 61 2785

TOTAL

1951 7528252 871918613 11582 $ 19735528 $252 2263 1952 7245595 828680000 11437 18895324 261 2280 1953 6981870 747771840 10710 16712580 239 2235 1954 1955

6978557 7179859

692824807 670030469

9928 9332

14956803 13876465

214 193

2159 201

1956 7417279 797041956 10746 17232765 232 2162 1957 7018047 686578050 9783 15528276 221 2262 1958 1959 1960

7228517 7360687 6795919

652314440 647209137 626790115

9024 8793 9223

14536957 15308460 15190717

201 208 224

2229 2365 2424

BeglOnmg With year 1959 lOcludes cash fares single and round trip tickets sold for travel within suburban area which in prior yeaTS were included in Other than Commutation

29

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATISTICS OF OPERATIONS

TOTAL TRANSPORTATIONFREIGHT TRAINS PASSENGER TRAlNS SERVICE ITEMS I

1960 1959 1960 1959 1960 1959

RAlL-LINE Average miles of road operared 1 1deg--589_1---1deg586=_-------34-=68 -1-__394-=-9_1-----=10--597-1---I0-594=-

TRAlN MILES

Ordinary (wirh locomorives) 9554242 10152235 6185162 6740403 15739404 16892638 Ligh t (with locomotives) 1_----27--3-59_ 1__-----_24----42-=5_ 1_middot_-----=--------_1 __---c-_o---=-_ 1_--=-2~73-50-9_1_---2442-5_

Total (with locomotives) 9581601 10176660 6185162 6740403 15766763 16917063 Motor car trains bull middotICmiddotmiddotmiddotmiddot~ ----1----=----middotmiddot_1----------1~7-o1_=_60--1-____=_=65--4_8__7+--=-=-1-721-6_0-1-_________65_--487-

Total train miles 1_ __=9 0-58_1--6_deg 1 1__1deg 176--=66_deg--1 60-2_0_23_22_1 __68_0_5 89_deg_1 __15--7_83-923_1 __16--bull98_2-0-550_

LOCOMOTIVE MILES

Principal 9583849 10180397 6185162 6740403 15769011 16920800 Helper 81260 109822 286 726 81546 110548 Lig~t 104438 151874 35078 49266 139516 201140 TraIn sWItchIng 856137 864118 bull bull 856137 864118 Yard switching 1_ __=5-58757--2_1_--=-58---62-=-6-=48=_1 __~4--28-0-54__=31__--441--949-1 __60161_15_1 __630_4--59-=-7

Total locomotive miles 1-162213--2561----=-17-168859=_1---=6649-deg-=69=-1----723-234-4+2=2c862325_1_---=-24401203=_

CAR MILES

Loaded freight cars 431972870 466352092 517228 101495 432490098 466453587 Empty freigh tears I~26624=2gt490_127-=325-=-3~4~594-1------=--5==-- bull6471=-1------=-=-5o-6_01---266--248gt13--1_ 1-27-3gt5-35-154=-

Total loaded and empty freight cars 698215360 739886686 522869 102055 698738229 739988741 Caboose 1~_9285~9235-=-5-1-~1023=2-=-9-651=-1------=_1~--2101------=-~2~1~1=7--1-~9~86-0--5-6--5-1-=-1=_=0--33__1--7--68--

Total freight car miles 17deg8gtdeg742715-1-7502216233~7 1_----=524-079=-1_---=104172_ 1-7deg825982794=-1 _---750-320509=_

Passenger coaches 4913 3974 22864172 23715856 22869085 23719830 Sleeping and parlor cars (Company) 1812568 1817919 1812568 1817919 Sleeping cars (Pullman) 38383 35410 12685592 13337316 12723975 13372726 Club lounge dining and observation cars 547 bull 4989125 5250522 4989672 5250522 Combination passenger and head end cars 501995 659233 169149 142633 671144 801866 Mail express and baggage cars 2570197 2539863 21120653 22269656 23690850 24809519 Business cars 1---=--3-6~66-41--=-=---44---1-5 133-deg82_ 1_-----1--49-=-3deg8_ 1_--16-=-974-=6_1_-----_193---4657-_ 1_----shy

Total passenger car miles I~--=3215226~99-1-__=__3~282=63=__7_1-63-7--7--4~3--41_1--6-6-6-83-21--0+-66--9-2 65--847shy72deg4deg+-=-=-69--9--Grand total car miles 1 7_11 _227--4_1_4_1 753 498-974_1_6_429_84_2deg---1_6_67_8_7--=3_8_2_ 775 525--8--=34_ __8_2deg_2_86--bull356_

1 1

GROSS TON MILES

Locomotives and tenders (thousands) 1_ __=3-3942655-1 __3450-518--1__2--0_4_22_10---1 __21_6--2 1-13_ _---=5 436--865_ __5--612__=6311 1Freight cars contents and cabooses (thousands) 31409774 32603899 23551 4151 31433325 32608050 Passenger cars and contents (thousands) 1---1632517-1---------=-1670109=-1---41deg29-=-95_1--42999-8--4-1---4--26625o-12=-1------4=467o-O973=-

To tal freig ht and passenger (th0 usands) 1 31 57322-911_----32-- 771degdeg8=_1 41_265_46_ 1__4--=30_4 135_1 35--699--8__=37_ ____=_37-- 075_14__=3-shy1

TRAIN HOURS

Train hours in road service 473544 507565 137163 154436 610707 662001

REVENUE AND NONREVENUE FREIGHT TRAFFIC Tons of revenue freight ~8305568 40199394 Tons of nonrevenue freight middot1middotmiddotmiddot--- middotmiddot-=middot1middot---middotmiddotmiddotmiddot--- middotmiddot-1middotmiddot---middot---middotmiddotmiddot--- cl __ __ middot_middotmiddotmiddot1 _=-=-8421=-=35_ 1-------1_=_deg6--deg-53-7shy

Total tons of freight IC--- I~ +bull--- 1 --- ---1 392147-7deg3_1_---=-41=2-59093-1 Net ton miles revenue freight (thousands) 13604642 14121940 Net ton miles nonrevenue freight (thousands) middot1-middotmiddot--middot-middot=~-c- -1-------------middot1middotc----c_c I_____--_middot~middot-middotmiddotI_=-=---25797-5179c+----=-3_=_81c-0=-36--

Total net ton miles of freigh t (thousands) 1_c138530726=_1----=-145021~3=-301--104~35 _1 1646_1-1386421611----=-145deg2976

REVENUE PASSENGER TRAFFIC

Passengers carried 6795919 7360687 Passenger miles 626790115 647209137

MOTOR VEHICLE OPERATIONS EXCLUDED ABOVE Net ton miles revenue freight (thousands) 1124 1318 Passengers carried 995 1914 Passenger miles 1041447 991687

30

ANNUAL REPORT FOR 1960

STATISTICS OF OPERATIONS-CONCLUDED

-ITEMS 1960 1959 1958 1957 1956 1955

FREIGHT TRAIN STATISTICS AND AVERAGES

Gross ton miles trailing (thousands) 31573291 32771008 32413288 34236747 36203655 36228284

Eastbound 17124676 18176737 18125895 18805435 19734331 19787705 Westbound 14448615 14594271 14287393 15431312 16469324 16440579

Steam middot middot 135 133258 Dieselmiddotelectric 29107869 29901296 29705585 31129417 32597742 32536016 Electric 2465422 2869712 2707703 3107330 3605778 3559010

Per cent steam - middot 4 Per cent Dieselmiddotelectric 922 912 916 909 900 898 Per cent electric 78 88 84 91 100 98

Loaded freight cars per train 452 459 443 443 446 434 Empty freigh t cars per train 279 270 277 267 247 235

Total freight cars per train 731 729 720 710 693 669

Gross tons per train - 3305 3228 3157 3117 3070 2969 Net tons per train 1450 1428 1390 1373 1370 1323 Net tons per loaded car 321 311 313 310 307 305 Miles per car per day (serviceable freight) 393 390 357 370 387 377 Net ton miles per freight car-day 736 734 655 673 715 702 Train speed (train miles per train hour) 202 200 196 192 191 190 Gross ton miles (trailing) per train hour 66674 64565 61714 59780 58328 56315

PASSENGER TRAIN STATISTICS AND AVERAGES

Passenger car miles (excluding motor) - 64230016 66525240 69087808 75256765 86613202 72582117

Steam middot 13184 16967 Dieselmiddotelectric 64227781 66502614 65218200 71665998 81157901 66905429 Electric 2235 22626 3869608 3590767 5442117 5659721

Per cent steam middot Per cent Diesel-electric 1000 1000 944 952 937 922 Per cent electric middot 56 48 63 78

Cars per train (excluding motor) 1038 987 960 960 984 891 Revenue passengers per train 1012 952 898 865 894 812 Revenue passengers per car 166 165 161 160 168 175 Train speed (train miles per train hour) 452 441 444 439 447 429

YARD SWITCHINGSTATISTICS

Yard switching hours 1002686 1Oi0766 1063803 1184130 1251620 1274248

Steam middot 7 11279 Dieselmiddotelectric 994370 1038534 1056660 1174874 1235025 1246748 Electric 8316 12232 7143 9256 16588 16221

Per cent steam middot middot 9 Per cent Dieselmiddotelectric 992 988 993 992 987 978 Per cent electric 8 12 7 8 13 13

DENSITY STATISTICS

Per mile of road per day (freight service) Train miles ordinary Net ton miles

Per mile of road per day (passenger service) Train miles Car miles

25 3575

49 507

26 3753

47 463

27 3694

48 455

28 3896

47 450

30 4153

53 517

31 4161

48 425

31

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

REVENUE FREIGHT BY PRINCIPAL COMMODITIES-1960 AND 1959

INCREASE + OR1960 1959 DECREASE shyCOMMODITIES

TONS CARRIED

PERCENT OF TOTAL

TONS CARRIED

PERCENT OF TOTAL TONS PERCENT

PRODUCTS OF AGRICULTURE Wheat Corn Batley and tye Oats shy

Flour meal and mill products Citrus fruits Other fruits fresh and frozen

1708445 1325050

763672 347413

1275613 39049

123945

45 35 20

9 33

1

3

1653685 1281473

738948 298327

1242503 59289

135892

41 32 18 7

31 2 3

+ + + + + --

54760 43577 24724 49086 33110 20240 11947

33 34 33

165 27

341 88

Potatoes other than sweet 0 0 bull 229982 6 264312 7 - 34330 130 Other vegetables fresh and frozen Sugar beets Other products of agriculture

115520 213813

1588516

3

6 41

126388 191132

1480059

3

5 37

-+ +

10868 22681

108457

86 119

73 Total 7731018 202 7472008 186 + 259010 35

ANIMALS AND PRODUCTS Cattle calves sheep and goats 171861 4 198623 5 - 26762 135 Swine 21999 1 33892 1 - 11893 351 Fresh meats 386670 10 427610 10 - 40940 96 Poultry eggs butter and cheese 113551 3 128422 3 - 14871 116 Wool hides and leather 153604 4 161264 4 - 7660 47 Other animals and products 268968 7 265237 7 + 3731 14

Total 1116653 29 1215048 30 - 98395 81

PRODUCTS OF MINES Bituminous coal 4862060 127 5447866 136 - 585806 108 Coke 257305 6 296121 7 - 38816 131 Ores and concentrates Gravel and sand

462461 916755

12 24

385162 1166550

10 29

+ -

77299 249795

201 214

Stone broken ground or crushed Stone rough and finished Asphalt

1291164 77997

195521

34 2 5

1192897 71099

234070

30 2 6

+ + -

98267 6898

38549

82 97

165 Salt 148276 4 165384 4 - 17108 103 Other products of miles 1138894 30 1154731 28 - 15837 14

Total 9350433 244 10113880 252 - 763447 75

PRODUCTS OF FORESTS Logs posts poles and cordwood 1290191 34 1604736 40 - 314545 196 Pulpwood 1028793 27 966773 24 + 62020 64 Lumber and mill products 1845337 48 2434155 61 - 588818 242 Veneer and builtup wood 467827 12 520054 13 - 52227 100 Other products of forests 376413 10 259064 6 + 117349 453

Total 5008561 131 5784782 144 - 776221 134

MANUFACTURES AND MISCELLANEOUS Refined ~etroleum and products 1175165 31 1258601 31 - 83436 66 Sugar ta Ie syrups and molasses Iron and steellroducts

304542 2251993

8 59

293861 2299049

7 57

+ -

10681 47056

36 20

Machinery an boilers 222962 6 230072 6 - 7110 31 Cement Brick building tile and artificial stone

1242018 191608

32 5

1152635 199113

29 5

+ -

89383 7505

78 38

lime and plaster 73696 2 81785 2 - 8089 99 Agricultural implements traCtors and parts 155626 4 206217 5 - 50591 245 Autos trucks parts and tires Beverages

745090 599592

19 16

685152 613561

17 15

+ -

59938 13969

87 23

Ice 32950 1 31716 1 + 1234 39 Fertilizers Paper and paper products

590481 1191363

15 31

535770 1200754

13 30

+ -

54711 9391

102 8

Canned food Jroducts 985346 26 997315 25 - 11969 12 Scrap iron an scrap steel 598594 15 758925 19 - 160331 211 Building paper roofing and woodwork 434465 11 460040 12 - 25575 56 Other manufactures and miscellaneous 4165926 109 4435508 110 - 269582 61

Total 14961417 390 15440074 384 - 478657 31

GRAND TOTAL CARLOAD TRAFFIC 38168082 996 40025792 996 - 1857710 46

ALL lCl FREIGHT 137486 4 173602 4 - 36116 208

GRAND TOTAL CARLOAD AND lCi TRAFFIC 38305568 1000 40199394 1000 - 1893826 47

32

ANNUAL REPORT FOR 1960

NUMBER OF EMPLOYEES AND COMPENSATION

REGULAR EMPLOYEES TOTAL COMPENSATION ALL EMPLOYEES PART TIME

EMPLOYEES CHARGED ToAVERAGE CoMPENSATION

YEAR Noop

EMPLOYEES (MIDDLE

OP MONTH COUNT)

CoMPENSATION

AVERAGE COMPENSATION

PER EMPLOYEE

(NOT SUBJECT TO

CONTINUING AUTHORITY

OP RAILROAD)

TOTAL COMPENSATION OPERATING

EXPENSES

ADDITIONS AND

BETTERMENTS AND OTHER ACCOUNTS

1928 48129 $ 81744769 $1698 $135855 $ 81880624 $ 75548543 $ 6332081 1933 26493 39042823 1474 129469 39172292 36740362 2431930 1938 28988 52830262 1822 100092 52930354 48224635 4705719 1943 35377 90305409 2553 145093 90450502 84109945 6340557 1948 38268 138490345 3619 172016 138662361 126543269 12119092 1950 33668 128201025 3808 167342 128368367 121226784 7141583 1951 33846 143260363 4233 219693 143480056 134493624 8986432 1952 32550 145397263 4467 149515 145546778 138390501 7156277 1953 31138 138117562 4436 145500 138263062 131304863 6958199 1954 27961 126272397 4516 143400 126415797 120564532 5851265 1955 27936 126447937 4526 139330 126587267 120732130 5855137 1956 27408 134534522 4909 123452 134657974 126936601 7721373 1957 26007 133239878 5123 117455 133357333 125221025 8136308 1958 23402 128237334 5480 119269 128356603 123103272 5253331 1959 middotmiddot 22243 128292584 5767 107083 128399667 122031078 6368589 1960 20229 121037664 5983 98143 121135807 114993442 6142365

NUMBER OF EMPLOYEES AND COMPENSATION BY STATES

REGULAR EMPLOYEES PART TIME TOTAL

AVERAGE EMPLOYEES COMPENSATIONSTATE

AVERAGE TOTAL CoMPENSATION TOTAL ALL NUMBER COMPENSATION PER COMPENSATION EMPLOYEES

EMPLOYEE

Illinois bull 5977 $ 35954281 $6015 $18179 $ 35972460 Iowa 2062 12410458 6019 5105 12415563 Wisconsin bull 5272 30334008 5754 21200 30355208 Minnesota 2446 14392068 5884 8726 14400794

122 906621 7431 0 906621~~~~~fmiddotmiddotmiddotmiddotmiddot 346 2035311 5882 10780 2046091 Indiana 289 1726773 5975 9180 1735953 South Dakota 902 5244002 5814 180 5244182 North Dakota bullbull 98 524782 5355 2599 527381 Moncana bull 1060 6740641 6359 22074 6762715 Idaho 94 574143 6108 0 574143 Washington 1412 9145616 6477 120 9145736 All otherbullbullbullbullbull 149 1048960 7040 0 1048960

Total 20229 $121037664 $5983 $98143 $121135807

TOTAL PAYROLLS AND COMPANY CONTRIBUTIONS AVERAGE PER EMPLOYEE

COMPANY CoNTRIBUTIONS STRAIGHT TIME RATETOTAL AVERAGE

PAYROLLSshyYEAR RETIREMENT AND HEALTH AND TOTAL PER AVERAGE INCREGULAR

UNEMPLOYMENT WELPARE EMPLOYEE PER OVEREMPLOYEES TAXES BENEFITS HOUR 1939

1950 $128201025 $7234363 $135435388 $4023 $1580 1179 1951 143260363 7774582 151034945 4463 1754 1419 1952 145397263 7696578 153093841 4703 1852 1554 1953 138117562 7441326 145558888 4675 1895 1614 1954 126272397 7035232 133307629 4768 1945 1683 1955 126447937 7276300 $ 624381 134348618 4809 1959 1702 1956 134534522 8581092 1403449 144519063 5273 2130 1938 1957 133239878 8692650 2106181 144038709 5538 2290 2159 1958 128237334 8420346 1934613 138592293 5922 2465 2400 1959 128292584 9894538 1819163 140006285 6294 2566 2539 1960 121037664 9969699 1646241 132653604 6558 2638 2639

33

ANNUAL REPORT FOR 1960

DETAILED STATEMENT OF RAILWAY OPERATING REVENUES AND EXPENSES

RAILWAY OPERATING REVENUES

1960 1959 INCREASE DECREASE TRANSPORTATION

Freight $189560907 $201536333 middot0 $ 11975426 Passenger 15174969 15282171 107202 Baggage 79806 86066 middot 6260 Parlor and chair car 83476 91957 8481 Mail 9418410 8862116 $ 556294 Express 3030579 3180656 150077 Other passenger-crain 107746 100303 7443 Milk 18260 30216 middot 11956 Switching 5979910 6591066 611156

1------1------1-------1------shyTOTAL TRANSPORTATION REVENUE 223454063 235760884 12306821

INCIDENTAL

Dining and buffet 1521218 1527536 6318 Station crain and boat privileges 57552 56068 1484 Storage-Freight 8015 11196 - 3181 Storage-Baggage 3631 3837 - 206 Demurrage 1240131 1248537 8406 Communication 55650 72541 16891 Rents of buildings and other property 257841 246697 11144 Miscellaneous 461149 507969 middot middot0 46820

TOTAL INCIDENTAL OPERATING REVENUE 3605187 3674381 69194

JOINT FACILITY

Joint facility-Credit 3315646 2620693 694953 Joint facility-Debit (11994) (14133) (2139)

TOTAL JOINT FACILITY OPERATING REVENUE 3303652 2606560 697092

TOTAL RAILWAY OPERATING REVENUE $230362902 $242041825 $ 11678923

( ) Denotes concra items

RAILWAY OPERATING EXPENSES

1960 1959 INCREASE DECREASE MAINTENANCE OF WAY AND STRUCTURES

Superincendence $ 3108012 $ 3388761 $ 280749 Roadway maincenance 2861659 2867371 5712 Tunnels and subways 10889 11354 465 Bridges trestles and culverts 986082 1198575 212493 Ties 1793766 1827106 33340 Rails 592902 894914 302012 Other track material 1336407 1996881 660474 Ballast 217365 408471 middot 191106 Track laying and surfacing Fences snowsheds and signs

6515560 319315

7505265 398716

989705 79401

Station and office buildings 828484 1014046 185562 Roadway buildings 55448 86514 31066 Water stations Fuel stations

12115 26908

21831 16802 $ 10106

9716

Shops and enginehouses 574222 542976 31246

25

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

RAILWAY a PERATING REVENUES AND EXPENSES- CONTINUED RAILWAY OPERATING EXPENSES-CONTINUED

MAINTENANCE OF WAY AND STRUCTURES

Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous StruCtures Road property-Depreciation _ Retiremenes- Road Roadway machines _ Dismantling retired road property Small cools and supplies Removing snow ice and sand Public improvemenes-Maintenance Injuries co persons Insurance Stationery and printing Other expenses Right-of-way expenses Maineaining joint cracks yards and other facilities-Debit Maintaining joint tracks yards and other facilities-Credit

TOTAL MAINTENANCE OF WAY AND STRUCTURES

MAINTENANCE OF EQUIPMENT

Superintendence Shop machinery Power-plant machinery Shop and powerplant machinery-Depreciation Dismantling retired shop and powermiddotplane machinery Other locomotives-Repairs Freight-train cars-Repairs Passenger-train cars-Repairs Work equipment-Repairs Miscellaneous equipment-Repairs Dismantling retired equipment Retirements-Equipment Equipmene- Depreciation Inj uries to persons Insurance Stationery and printing Other expenses Taint maintenance of equipment expenses-Debit Taint maineenance of equipmene expenses-Credit

TOTAL MAINTENANCE OF EQUIPMENT

TRAFFIC

Superintendence Outside agencies Advertising Traffic associations Industrial and immigration bureaus Insurance Stationery and printing Other expenses

1960 1959 INCREASE DECREASE

$ 56714 $ 36447 $ 20267 bullbullbullbullbullbullbull _0 bullbullbullbullbullbull

935578 909129 26449 bullbull 0 bullbullbullbullbullbullbull 0 bullbullbullbullbull

bullbullbullbullbullbull 0 bullbullbullbullbullbull bull bullbull 1838913 1653168 185745 31898 33384 $ 1486 301492 355954 54462 9685 11190 middot 1505 5028247 4953681 74566 197350 241483 44133 706168 892299 186131 107360 148842 middot 41482 780012 825073 45061 841898 1093119 251221 736255 713553 22702 0 326277 442052 115775 50816 46225 4591 71268 87971 16703 419344 470012 50668bull bullbull 0 bullbullbullbullbullbullbullbullbullbull

43266 45762 2496

2725332 2842160 middot 116828

(755037) (550863) (204174) 1------1------1-------1------shy

33691970 37430224 3738254

1716762 1720882 41200 bullbullbullbullbullbullbullbullbullbullbullbullbullbullbull

521695 506499 15196

133941 153222 19281

284088 285333 1245

3681 856 2825

12448450 13197294 748844

9119749 10867539 1747790

2844061 3581261 737200

249163 301007 middot 51844

196990 196551 439

110983 91095 19888

(139163) (764585) (625422)

10468468 10143824 324644

245956 297309 51353

66754 68018 1264

42632 59005 16373

477426 563338 85912

292109 629586 337477

( 35052) (35250) (198)

39048693 41862784 2814091

1853253 1775877 77376

3420570 3680896 260326

641695 669595 27900

316941 281954 34987

50793 58011 7218

991 875 116

267539 246898 20641

29672 34959 5287 1------1------1middot------1------shy

TOTAL TRAFFIC EXPENSES $ 6581454 $ 6749065 $ 167611

( ) Denotes contra items

26

ANNUAL REPORT FOR 1960

RAILWAY OPERATING REVENUES AND EXPENSES-CONCLUDED

RAILWAY OPERATING EXPENSES-CONCLUDED

1960 1959 INCREASE DECREASE TRANSPORTATION

Superintendence $ 2981453 S 2814960 $166493 Dispatching trains 737390 807806 $ 70416 Station employees 12568811 13277513 708702 Weighing inspection and demurrage bureaus 307278 325534 bullbullbullbullbullbull 0 bullbullbullbullbullbullbullbullbull 18256 Station supplies and expenses 1091896 1140062 bullbull 0 bullbullbull 0 bullbullbullbullbullbull 0 bullbull 48166 Yardmasters and yard clerks 3991133 4119498 bullbullbullbullbullbull 0 bullbullbullbullbullbull 0 bullbull 128365 Yard conductors and brakemen 9303622 9647318 343696 Yard swirch and signal tenders 730410 755025 24615 Yard enginemen 6155278 6362440 207162 Yard switching fuel 923737 988987 65250 Yard switching power purchased 11946 15258 bullbull 0 bullbullbullbullbullbullbullbullbullbullbullbullbull 3312 Water for yard locomotives 17360 19948 2588 Lubricants for yard locomotives 83523 109472 25949 Other supplies for yard locomotives Enginehouse expenses-Yard

49721 498339

48817 542983

904

44644

Yard supplies and expenses Operating joint yards and terminals-Debit Operatin~ joint yards and terminals-Credit Train engInemen Train fuel Train power purchased Water for train locomotives

466959 5790981 (683719)

9533667 7243332

864933 94310

441246 5978628 (685475)

9966568 7758783

907295 105164

25713 middot bull bullbull 0 bullbullbullbullbullbullbullbullbullbull 0

middot

187647

(1756) 432901 515451 42362 10854

Lubricants for train locomotives 795622 938600 142978 Other supplies for train locomotives Enginehouse expenses-Train Trainmen

210707 1124921

12091384

202708 1222756

12613963

7999 bullbullbullbull 0 bullbullbullbullbullbullbull bullbullbullbull

97835

522579 Train supplies and expenses 6340264 6660876 320612 Operating sleeping cars 715113 526531 188582 Signal and interlcker operation CrOSSIng protectIOn

1049887

721750 1037947

806370 11940

middot

84620 Drawbridge operation 215086 258082 42996 Communication system operation 1060497 1081772 21275 Operating Boating equipment 11796 10985 811 Srationery and printing 412827 392820 20007 Other expenses 817489 848149 30660 Operating joint tracks and facilities-Debit 1170056 1311393 141337 Operating joint tracks and faciliries-Credir Insurance

(786053)

78437 (751937)

92514 (34116)

14077 Clearing wrecks Damage to property

265853 120728

230128 206210

35725

85482

Damage to live stock on right-of-way Loss and damage-Freight

80817

2795442 53816

2942960 27001

147518 Loss and damage-Baggage 5528 722 4806 Injuries to persons 1708733 1714453 5720

TOTAL TRANSPORTATION EXPENSES 93769244 97849648 4080404

MISCELLANEOUS OPERATIONS Dining and buffet service 2855845 2888241 32396 Operaring joint miscellaneous facilities-Debit 149757 207418 57661

J------J------I-------I------shyTOTAL MISCELLANEOUS OPERATIONS 3005602 3095659 90057

GENBRAL Salaries and expenses of general officers 1421416 1331832 89584 Salaries and expenses of clerks and attendants 6821635 6920559 98924 General office supplies and expenses 753564 727092 26472 Law expenses 831662 811940 19722 Insurance 33708 6002 27706 Pensions and gratuities 818190 917286 99096 Stationery and priming 348137 336267 11870 Valuation expenses 53068 59453 6385 Other expenses 501292 520844 19552 General joint faciliries-Debit 258783 241859 16924 General joint faciliries-Credit (8615) (8933) (318)

TOTAL GENERAL EXPENSES 11832840 11864201 middot 31361

GRAND TOTAL RAILWAY OPERATING EXPENSES $187929803 $198851581 $10921778

( ) Denotes contra items

27

bullbullbull

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

ANALYSIS OF INCREASES AND DECREASES IN TOTAL RAILWAY OPERATING EXPENSES 1960 COMPARED WITH 1959

MAINTENANCE MAINTENANCE TRANSshyITEMS OF WAY AND OP ALL OTHER TOTALPORTATIONSTRUCTURES EQUIPMENT

LABOR General wage increases + $ 360933 + $ 323486 + $1370434 + $ 289045 + $ 2343898 Straight time worked - 2213317 - 2135307 - 4273302 - 680973 - 9302899 Overtime worked - 76922 - 10613 - 163702 9398 - 241839+ Time paid for not worked (incl vacations and holidays) - 100783 - 137170 - 123771 33475 - 323249+

TOTAL LABOR - 2030089 - 1959604 - 3190341 - 344055 - 7524089

FUEL Price middot middot middot - 375791 - 375791 Consumption middot middot middot - 204910 - 204910

TOTAL FUEL middot middot middot middot - 580701 middot - 580701

ELECTRIC POWER middot bullbullbullbullbullbull to middot middot - 45674 middot - 45674

MATERIAL-Ocher than fuel Price + 106251 112344 - 1059 17453 234989 Quanticy - 1181388 - 900335 201128 34210 - 1846385

+ + + + +

TOTAL MATERIAL OTHER THAN FUEL - 1075137 - 787991 200069 51663 - 1611396+ + MISCELLANEOUS

Health and welfare benefits - 38735 - 60626 - 57909 - 15652 - 172922 Other miscellaneous - 624726 - 954691 - 405848 19015 - 1966250+

TOTAL MISCELLANEOUS - 663461 - 1015317 - 463757 3363 - 2139172+ TOTAL LABOR MATERIAL AND MISCELLANEOUS - 3768687 - 3762912 - 4080404 - 289029 - 11901032

DEPRECIATION + 74566 323399 middot + 397965+ middotRETIREMENTS - 44133 625422 middot + 581289+

TOTAL DEPRECIATION AND RETIREMENTS + 30433 948821 middot middot + 979254+ TOTAL RAfLWAY OPERATING EXPENSES - $3738254 - $2814091 - $4080404 289029 - $10921778-I $

RAILWAY OPERATING REVENUES EXPENSES TAXES AND INCOME BY MONTHS FOR THE YEAR ENDED DECEMBER 31 1960

1960

RAILWAY OPERATING REVENUES

RAILWAY OPERATING

EXPENSES

NET REVENUE FROM

RAILWAY OPERATIONS

RAILWAY TAX

ACCRUALS

RAILWAY OPERATING

INCOME

EQUIPMENT RENTS-NET

DR

JOINT FACILITY

RENTS-NET DR

NET RAILWAY OPERATING

INCOME

January $ 17336067 $ 15803272 $ 1532795 $ 1670000 $ (137205) $ 422175 S 231113 $ (790493) February 18493440 15151942 3341498 1673000 1668498 490735 234172 943591 March 19025746 15902966 3122780 1695000 1427780 686903 219282 521595 April bull 18042813 15280563 2762250 1684000 1078250 586443 251268 240539

May 18975935 16148830 2827105 1728000 1099105 824503 181449 93153 June 19011723 16297457 2714266 1727000 987266 803292 217671 (33697) July 18796482 15947748 2848734 1728000 1120734 823376 203289 94069 August 23377375 17022049 6355326 1806000 4549326 1420370 316997 2811959

September 20166066 15953895 4212171 1685000 2527171 1100653 248649 1177869 October 20925500 14736878 6188622 1647000 4541622 980838 252319 3308465 November 18549759 14797644 3752115 1620000 2132115 848876 267507 1015732 December 17661996 14886559 2775437 1474000 1301437 791725 238186 271526

Total $230362902 $187929803 $42433099 $20137000 $22296099 $9779889 $2861902 $9654308

( ) Denotes contra items 28

ANNUAL REPORT FOR 1960

REVENUE FREIGHT TRAFFIC STATISTICS-EXCLUDING TRUCK SERVICE

FREIGHT REVENUE AVERAGE

TONS TONSYEAR HAUL- PERCARRIED MILES PER

MILES TOTAL TON MILETON

(CENTS)

1951 51740580 16732323827 32339 $217832219 $421 1302 1952 49522089 16005309995 32320 222648097 450 1391 1953 46810989 15413226569 32927 215622726 461 1399 1954 43123214 14178678856 32879 197712105 458 1394 1955 45481060 95561748530 34216 205993029 453 1324

1956 45351213 15612344863 34425 209886542 463 1344 1957 42915573 14614118553 34025 212631339 495 1455 1958 40117213 13884510331 34610 205489920 512 1480 1959 40199394 14121939599 35130 201705278 502 1428 1960 38305568 13604642301 35516 189750236 495 1395

REVENUE PASSENGER STATISTICS-EXCLUDING BUS SERVICE

PASSENGER REVENUE AVERAGE

PASSENGERS PASSENGER DISTANCE PER YEAR

CARRIED MILES TRAVELED PER PASSENGER TOTAL

-MILES PASSENGER MILE (CENTS)

OTHER THAN COMMUTATION

1951 3341410 776958568 23252 $ 18484470 $553 2379 1952 3346346 739380708 22095 17569369 525 2376 1953 3158639 658842799 20858 15396026 487 2337 1954 3057733 599281006 19599 13582309 444 2266 1955 3003108 571128913 19018 12413340 413 2173

1956 3266663 696906549 21334 15758692 482 2261 1957 2943819 587947230 19972 14064509 478 2392 1958 2889740 549258597 19007 12969955 449 2361 1959 1839572 523514965 28459 12490275 679 2386 1960 1759253 515650913 29311 12095377 688 2346

CoMMUTATION

1951 4186842 94960045 2268 $ 1251058 $ 30 1317 1952 3899249 89299292 2290 1325955 34 1485 1953 3823231 88929041 2326 1316554 34 1480 1954 3920824 93543801 2386 1374494 35 1469 1955 4176751 98901556 2368 1463125 35 1479

1956 4150616 100135407 2413 1474073 36 1472 1957 4074228 98630820 2421 1463767 36 1484 1958 4338777 103055843 2375 1567002 36 1521 1959 5521115 123694172 2240 2818185 51 2278 1960 5036666 111139202 2207 3095340 61 2785

TOTAL

1951 7528252 871918613 11582 $ 19735528 $252 2263 1952 7245595 828680000 11437 18895324 261 2280 1953 6981870 747771840 10710 16712580 239 2235 1954 1955

6978557 7179859

692824807 670030469

9928 9332

14956803 13876465

214 193

2159 201

1956 7417279 797041956 10746 17232765 232 2162 1957 7018047 686578050 9783 15528276 221 2262 1958 1959 1960

7228517 7360687 6795919

652314440 647209137 626790115

9024 8793 9223

14536957 15308460 15190717

201 208 224

2229 2365 2424

BeglOnmg With year 1959 lOcludes cash fares single and round trip tickets sold for travel within suburban area which in prior yeaTS were included in Other than Commutation

29

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATISTICS OF OPERATIONS

TOTAL TRANSPORTATIONFREIGHT TRAINS PASSENGER TRAlNS SERVICE ITEMS I

1960 1959 1960 1959 1960 1959

RAlL-LINE Average miles of road operared 1 1deg--589_1---1deg586=_-------34-=68 -1-__394-=-9_1-----=10--597-1---I0-594=-

TRAlN MILES

Ordinary (wirh locomorives) 9554242 10152235 6185162 6740403 15739404 16892638 Ligh t (with locomotives) 1_----27--3-59_ 1__-----_24----42-=5_ 1_middot_-----=--------_1 __---c-_o---=-_ 1_--=-2~73-50-9_1_---2442-5_

Total (with locomotives) 9581601 10176660 6185162 6740403 15766763 16917063 Motor car trains bull middotICmiddotmiddotmiddotmiddot~ ----1----=----middotmiddot_1----------1~7-o1_=_60--1-____=_=65--4_8__7+--=-=-1-721-6_0-1-_________65_--487-

Total train miles 1_ __=9 0-58_1--6_deg 1 1__1deg 176--=66_deg--1 60-2_0_23_22_1 __68_0_5 89_deg_1 __15--7_83-923_1 __16--bull98_2-0-550_

LOCOMOTIVE MILES

Principal 9583849 10180397 6185162 6740403 15769011 16920800 Helper 81260 109822 286 726 81546 110548 Lig~t 104438 151874 35078 49266 139516 201140 TraIn sWItchIng 856137 864118 bull bull 856137 864118 Yard switching 1_ __=5-58757--2_1_--=-58---62-=-6-=48=_1 __~4--28-0-54__=31__--441--949-1 __60161_15_1 __630_4--59-=-7

Total locomotive miles 1-162213--2561----=-17-168859=_1---=6649-deg-=69=-1----723-234-4+2=2c862325_1_---=-24401203=_

CAR MILES

Loaded freight cars 431972870 466352092 517228 101495 432490098 466453587 Empty freigh tears I~26624=2gt490_127-=325-=-3~4~594-1------=--5==-- bull6471=-1------=-=-5o-6_01---266--248gt13--1_ 1-27-3gt5-35-154=-

Total loaded and empty freight cars 698215360 739886686 522869 102055 698738229 739988741 Caboose 1~_9285~9235-=-5-1-~1023=2-=-9-651=-1------=_1~--2101------=-~2~1~1=7--1-~9~86-0--5-6--5-1-=-1=_=0--33__1--7--68--

Total freight car miles 17deg8gtdeg742715-1-7502216233~7 1_----=524-079=-1_---=104172_ 1-7deg825982794=-1 _---750-320509=_

Passenger coaches 4913 3974 22864172 23715856 22869085 23719830 Sleeping and parlor cars (Company) 1812568 1817919 1812568 1817919 Sleeping cars (Pullman) 38383 35410 12685592 13337316 12723975 13372726 Club lounge dining and observation cars 547 bull 4989125 5250522 4989672 5250522 Combination passenger and head end cars 501995 659233 169149 142633 671144 801866 Mail express and baggage cars 2570197 2539863 21120653 22269656 23690850 24809519 Business cars 1---=--3-6~66-41--=-=---44---1-5 133-deg82_ 1_-----1--49-=-3deg8_ 1_--16-=-974-=6_1_-----_193---4657-_ 1_----shy

Total passenger car miles I~--=3215226~99-1-__=__3~282=63=__7_1-63-7--7--4~3--41_1--6-6-6-83-21--0+-66--9-2 65--847shy72deg4deg+-=-=-69--9--Grand total car miles 1 7_11 _227--4_1_4_1 753 498-974_1_6_429_84_2deg---1_6_67_8_7--=3_8_2_ 775 525--8--=34_ __8_2deg_2_86--bull356_

1 1

GROSS TON MILES

Locomotives and tenders (thousands) 1_ __=3-3942655-1 __3450-518--1__2--0_4_22_10---1 __21_6--2 1-13_ _---=5 436--865_ __5--612__=6311 1Freight cars contents and cabooses (thousands) 31409774 32603899 23551 4151 31433325 32608050 Passenger cars and contents (thousands) 1---1632517-1---------=-1670109=-1---41deg29-=-95_1--42999-8--4-1---4--26625o-12=-1------4=467o-O973=-

To tal freig ht and passenger (th0 usands) 1 31 57322-911_----32-- 771degdeg8=_1 41_265_46_ 1__4--=30_4 135_1 35--699--8__=37_ ____=_37-- 075_14__=3-shy1

TRAIN HOURS

Train hours in road service 473544 507565 137163 154436 610707 662001

REVENUE AND NONREVENUE FREIGHT TRAFFIC Tons of revenue freight ~8305568 40199394 Tons of nonrevenue freight middot1middotmiddotmiddot--- middotmiddot-=middot1middot---middotmiddotmiddotmiddot--- middotmiddot-1middotmiddot---middot---middotmiddotmiddot--- cl __ __ middot_middotmiddotmiddot1 _=-=-8421=-=35_ 1-------1_=_deg6--deg-53-7shy

Total tons of freight IC--- I~ +bull--- 1 --- ---1 392147-7deg3_1_---=-41=2-59093-1 Net ton miles revenue freight (thousands) 13604642 14121940 Net ton miles nonrevenue freight (thousands) middot1-middotmiddot--middot-middot=~-c- -1-------------middot1middotc----c_c I_____--_middot~middot-middotmiddotI_=-=---25797-5179c+----=-3_=_81c-0=-36--

Total net ton miles of freigh t (thousands) 1_c138530726=_1----=-145021~3=-301--104~35 _1 1646_1-1386421611----=-145deg2976

REVENUE PASSENGER TRAFFIC

Passengers carried 6795919 7360687 Passenger miles 626790115 647209137

MOTOR VEHICLE OPERATIONS EXCLUDED ABOVE Net ton miles revenue freight (thousands) 1124 1318 Passengers carried 995 1914 Passenger miles 1041447 991687

30

ANNUAL REPORT FOR 1960

STATISTICS OF OPERATIONS-CONCLUDED

-ITEMS 1960 1959 1958 1957 1956 1955

FREIGHT TRAIN STATISTICS AND AVERAGES

Gross ton miles trailing (thousands) 31573291 32771008 32413288 34236747 36203655 36228284

Eastbound 17124676 18176737 18125895 18805435 19734331 19787705 Westbound 14448615 14594271 14287393 15431312 16469324 16440579

Steam middot middot 135 133258 Dieselmiddotelectric 29107869 29901296 29705585 31129417 32597742 32536016 Electric 2465422 2869712 2707703 3107330 3605778 3559010

Per cent steam - middot 4 Per cent Dieselmiddotelectric 922 912 916 909 900 898 Per cent electric 78 88 84 91 100 98

Loaded freight cars per train 452 459 443 443 446 434 Empty freigh t cars per train 279 270 277 267 247 235

Total freight cars per train 731 729 720 710 693 669

Gross tons per train - 3305 3228 3157 3117 3070 2969 Net tons per train 1450 1428 1390 1373 1370 1323 Net tons per loaded car 321 311 313 310 307 305 Miles per car per day (serviceable freight) 393 390 357 370 387 377 Net ton miles per freight car-day 736 734 655 673 715 702 Train speed (train miles per train hour) 202 200 196 192 191 190 Gross ton miles (trailing) per train hour 66674 64565 61714 59780 58328 56315

PASSENGER TRAIN STATISTICS AND AVERAGES

Passenger car miles (excluding motor) - 64230016 66525240 69087808 75256765 86613202 72582117

Steam middot 13184 16967 Dieselmiddotelectric 64227781 66502614 65218200 71665998 81157901 66905429 Electric 2235 22626 3869608 3590767 5442117 5659721

Per cent steam middot Per cent Diesel-electric 1000 1000 944 952 937 922 Per cent electric middot 56 48 63 78

Cars per train (excluding motor) 1038 987 960 960 984 891 Revenue passengers per train 1012 952 898 865 894 812 Revenue passengers per car 166 165 161 160 168 175 Train speed (train miles per train hour) 452 441 444 439 447 429

YARD SWITCHINGSTATISTICS

Yard switching hours 1002686 1Oi0766 1063803 1184130 1251620 1274248

Steam middot 7 11279 Dieselmiddotelectric 994370 1038534 1056660 1174874 1235025 1246748 Electric 8316 12232 7143 9256 16588 16221

Per cent steam middot middot 9 Per cent Dieselmiddotelectric 992 988 993 992 987 978 Per cent electric 8 12 7 8 13 13

DENSITY STATISTICS

Per mile of road per day (freight service) Train miles ordinary Net ton miles

Per mile of road per day (passenger service) Train miles Car miles

25 3575

49 507

26 3753

47 463

27 3694

48 455

28 3896

47 450

30 4153

53 517

31 4161

48 425

31

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

REVENUE FREIGHT BY PRINCIPAL COMMODITIES-1960 AND 1959

INCREASE + OR1960 1959 DECREASE shyCOMMODITIES

TONS CARRIED

PERCENT OF TOTAL

TONS CARRIED

PERCENT OF TOTAL TONS PERCENT

PRODUCTS OF AGRICULTURE Wheat Corn Batley and tye Oats shy

Flour meal and mill products Citrus fruits Other fruits fresh and frozen

1708445 1325050

763672 347413

1275613 39049

123945

45 35 20

9 33

1

3

1653685 1281473

738948 298327

1242503 59289

135892

41 32 18 7

31 2 3

+ + + + + --

54760 43577 24724 49086 33110 20240 11947

33 34 33

165 27

341 88

Potatoes other than sweet 0 0 bull 229982 6 264312 7 - 34330 130 Other vegetables fresh and frozen Sugar beets Other products of agriculture

115520 213813

1588516

3

6 41

126388 191132

1480059

3

5 37

-+ +

10868 22681

108457

86 119

73 Total 7731018 202 7472008 186 + 259010 35

ANIMALS AND PRODUCTS Cattle calves sheep and goats 171861 4 198623 5 - 26762 135 Swine 21999 1 33892 1 - 11893 351 Fresh meats 386670 10 427610 10 - 40940 96 Poultry eggs butter and cheese 113551 3 128422 3 - 14871 116 Wool hides and leather 153604 4 161264 4 - 7660 47 Other animals and products 268968 7 265237 7 + 3731 14

Total 1116653 29 1215048 30 - 98395 81

PRODUCTS OF MINES Bituminous coal 4862060 127 5447866 136 - 585806 108 Coke 257305 6 296121 7 - 38816 131 Ores and concentrates Gravel and sand

462461 916755

12 24

385162 1166550

10 29

+ -

77299 249795

201 214

Stone broken ground or crushed Stone rough and finished Asphalt

1291164 77997

195521

34 2 5

1192897 71099

234070

30 2 6

+ + -

98267 6898

38549

82 97

165 Salt 148276 4 165384 4 - 17108 103 Other products of miles 1138894 30 1154731 28 - 15837 14

Total 9350433 244 10113880 252 - 763447 75

PRODUCTS OF FORESTS Logs posts poles and cordwood 1290191 34 1604736 40 - 314545 196 Pulpwood 1028793 27 966773 24 + 62020 64 Lumber and mill products 1845337 48 2434155 61 - 588818 242 Veneer and builtup wood 467827 12 520054 13 - 52227 100 Other products of forests 376413 10 259064 6 + 117349 453

Total 5008561 131 5784782 144 - 776221 134

MANUFACTURES AND MISCELLANEOUS Refined ~etroleum and products 1175165 31 1258601 31 - 83436 66 Sugar ta Ie syrups and molasses Iron and steellroducts

304542 2251993

8 59

293861 2299049

7 57

+ -

10681 47056

36 20

Machinery an boilers 222962 6 230072 6 - 7110 31 Cement Brick building tile and artificial stone

1242018 191608

32 5

1152635 199113

29 5

+ -

89383 7505

78 38

lime and plaster 73696 2 81785 2 - 8089 99 Agricultural implements traCtors and parts 155626 4 206217 5 - 50591 245 Autos trucks parts and tires Beverages

745090 599592

19 16

685152 613561

17 15

+ -

59938 13969

87 23

Ice 32950 1 31716 1 + 1234 39 Fertilizers Paper and paper products

590481 1191363

15 31

535770 1200754

13 30

+ -

54711 9391

102 8

Canned food Jroducts 985346 26 997315 25 - 11969 12 Scrap iron an scrap steel 598594 15 758925 19 - 160331 211 Building paper roofing and woodwork 434465 11 460040 12 - 25575 56 Other manufactures and miscellaneous 4165926 109 4435508 110 - 269582 61

Total 14961417 390 15440074 384 - 478657 31

GRAND TOTAL CARLOAD TRAFFIC 38168082 996 40025792 996 - 1857710 46

ALL lCl FREIGHT 137486 4 173602 4 - 36116 208

GRAND TOTAL CARLOAD AND lCi TRAFFIC 38305568 1000 40199394 1000 - 1893826 47

32

ANNUAL REPORT FOR 1960

NUMBER OF EMPLOYEES AND COMPENSATION

REGULAR EMPLOYEES TOTAL COMPENSATION ALL EMPLOYEES PART TIME

EMPLOYEES CHARGED ToAVERAGE CoMPENSATION

YEAR Noop

EMPLOYEES (MIDDLE

OP MONTH COUNT)

CoMPENSATION

AVERAGE COMPENSATION

PER EMPLOYEE

(NOT SUBJECT TO

CONTINUING AUTHORITY

OP RAILROAD)

TOTAL COMPENSATION OPERATING

EXPENSES

ADDITIONS AND

BETTERMENTS AND OTHER ACCOUNTS

1928 48129 $ 81744769 $1698 $135855 $ 81880624 $ 75548543 $ 6332081 1933 26493 39042823 1474 129469 39172292 36740362 2431930 1938 28988 52830262 1822 100092 52930354 48224635 4705719 1943 35377 90305409 2553 145093 90450502 84109945 6340557 1948 38268 138490345 3619 172016 138662361 126543269 12119092 1950 33668 128201025 3808 167342 128368367 121226784 7141583 1951 33846 143260363 4233 219693 143480056 134493624 8986432 1952 32550 145397263 4467 149515 145546778 138390501 7156277 1953 31138 138117562 4436 145500 138263062 131304863 6958199 1954 27961 126272397 4516 143400 126415797 120564532 5851265 1955 27936 126447937 4526 139330 126587267 120732130 5855137 1956 27408 134534522 4909 123452 134657974 126936601 7721373 1957 26007 133239878 5123 117455 133357333 125221025 8136308 1958 23402 128237334 5480 119269 128356603 123103272 5253331 1959 middotmiddot 22243 128292584 5767 107083 128399667 122031078 6368589 1960 20229 121037664 5983 98143 121135807 114993442 6142365

NUMBER OF EMPLOYEES AND COMPENSATION BY STATES

REGULAR EMPLOYEES PART TIME TOTAL

AVERAGE EMPLOYEES COMPENSATIONSTATE

AVERAGE TOTAL CoMPENSATION TOTAL ALL NUMBER COMPENSATION PER COMPENSATION EMPLOYEES

EMPLOYEE

Illinois bull 5977 $ 35954281 $6015 $18179 $ 35972460 Iowa 2062 12410458 6019 5105 12415563 Wisconsin bull 5272 30334008 5754 21200 30355208 Minnesota 2446 14392068 5884 8726 14400794

122 906621 7431 0 906621~~~~~fmiddotmiddotmiddotmiddotmiddot 346 2035311 5882 10780 2046091 Indiana 289 1726773 5975 9180 1735953 South Dakota 902 5244002 5814 180 5244182 North Dakota bullbull 98 524782 5355 2599 527381 Moncana bull 1060 6740641 6359 22074 6762715 Idaho 94 574143 6108 0 574143 Washington 1412 9145616 6477 120 9145736 All otherbullbullbullbullbull 149 1048960 7040 0 1048960

Total 20229 $121037664 $5983 $98143 $121135807

TOTAL PAYROLLS AND COMPANY CONTRIBUTIONS AVERAGE PER EMPLOYEE

COMPANY CoNTRIBUTIONS STRAIGHT TIME RATETOTAL AVERAGE

PAYROLLSshyYEAR RETIREMENT AND HEALTH AND TOTAL PER AVERAGE INCREGULAR

UNEMPLOYMENT WELPARE EMPLOYEE PER OVEREMPLOYEES TAXES BENEFITS HOUR 1939

1950 $128201025 $7234363 $135435388 $4023 $1580 1179 1951 143260363 7774582 151034945 4463 1754 1419 1952 145397263 7696578 153093841 4703 1852 1554 1953 138117562 7441326 145558888 4675 1895 1614 1954 126272397 7035232 133307629 4768 1945 1683 1955 126447937 7276300 $ 624381 134348618 4809 1959 1702 1956 134534522 8581092 1403449 144519063 5273 2130 1938 1957 133239878 8692650 2106181 144038709 5538 2290 2159 1958 128237334 8420346 1934613 138592293 5922 2465 2400 1959 128292584 9894538 1819163 140006285 6294 2566 2539 1960 121037664 9969699 1646241 132653604 6558 2638 2639

33

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

RAILWAY a PERATING REVENUES AND EXPENSES- CONTINUED RAILWAY OPERATING EXPENSES-CONTINUED

MAINTENANCE OF WAY AND STRUCTURES

Wharves and docks Communication systems Signals and interlockers Power planes Power-transmission systems Miscellaneous StruCtures Road property-Depreciation _ Retiremenes- Road Roadway machines _ Dismantling retired road property Small cools and supplies Removing snow ice and sand Public improvemenes-Maintenance Injuries co persons Insurance Stationery and printing Other expenses Right-of-way expenses Maineaining joint cracks yards and other facilities-Debit Maintaining joint tracks yards and other facilities-Credit

TOTAL MAINTENANCE OF WAY AND STRUCTURES

MAINTENANCE OF EQUIPMENT

Superintendence Shop machinery Power-plant machinery Shop and powerplant machinery-Depreciation Dismantling retired shop and powermiddotplane machinery Other locomotives-Repairs Freight-train cars-Repairs Passenger-train cars-Repairs Work equipment-Repairs Miscellaneous equipment-Repairs Dismantling retired equipment Retirements-Equipment Equipmene- Depreciation Inj uries to persons Insurance Stationery and printing Other expenses Taint maintenance of equipment expenses-Debit Taint maineenance of equipmene expenses-Credit

TOTAL MAINTENANCE OF EQUIPMENT

TRAFFIC

Superintendence Outside agencies Advertising Traffic associations Industrial and immigration bureaus Insurance Stationery and printing Other expenses

1960 1959 INCREASE DECREASE

$ 56714 $ 36447 $ 20267 bullbullbullbullbullbullbull _0 bullbullbullbullbullbull

935578 909129 26449 bullbull 0 bullbullbullbullbullbullbull 0 bullbullbullbullbull

bullbullbullbullbullbull 0 bullbullbullbullbullbull bull bullbull 1838913 1653168 185745 31898 33384 $ 1486 301492 355954 54462 9685 11190 middot 1505 5028247 4953681 74566 197350 241483 44133 706168 892299 186131 107360 148842 middot 41482 780012 825073 45061 841898 1093119 251221 736255 713553 22702 0 326277 442052 115775 50816 46225 4591 71268 87971 16703 419344 470012 50668bull bullbull 0 bullbullbullbullbullbullbullbullbullbull

43266 45762 2496

2725332 2842160 middot 116828

(755037) (550863) (204174) 1------1------1-------1------shy

33691970 37430224 3738254

1716762 1720882 41200 bullbullbullbullbullbullbullbullbullbullbullbullbullbullbull

521695 506499 15196

133941 153222 19281

284088 285333 1245

3681 856 2825

12448450 13197294 748844

9119749 10867539 1747790

2844061 3581261 737200

249163 301007 middot 51844

196990 196551 439

110983 91095 19888

(139163) (764585) (625422)

10468468 10143824 324644

245956 297309 51353

66754 68018 1264

42632 59005 16373

477426 563338 85912

292109 629586 337477

( 35052) (35250) (198)

39048693 41862784 2814091

1853253 1775877 77376

3420570 3680896 260326

641695 669595 27900

316941 281954 34987

50793 58011 7218

991 875 116

267539 246898 20641

29672 34959 5287 1------1------1middot------1------shy

TOTAL TRAFFIC EXPENSES $ 6581454 $ 6749065 $ 167611

( ) Denotes contra items

26

ANNUAL REPORT FOR 1960

RAILWAY OPERATING REVENUES AND EXPENSES-CONCLUDED

RAILWAY OPERATING EXPENSES-CONCLUDED

1960 1959 INCREASE DECREASE TRANSPORTATION

Superintendence $ 2981453 S 2814960 $166493 Dispatching trains 737390 807806 $ 70416 Station employees 12568811 13277513 708702 Weighing inspection and demurrage bureaus 307278 325534 bullbullbullbullbullbull 0 bullbullbullbullbullbullbullbullbull 18256 Station supplies and expenses 1091896 1140062 bullbull 0 bullbullbull 0 bullbullbullbullbullbull 0 bullbull 48166 Yardmasters and yard clerks 3991133 4119498 bullbullbullbullbullbull 0 bullbullbullbullbullbull 0 bullbull 128365 Yard conductors and brakemen 9303622 9647318 343696 Yard swirch and signal tenders 730410 755025 24615 Yard enginemen 6155278 6362440 207162 Yard switching fuel 923737 988987 65250 Yard switching power purchased 11946 15258 bullbull 0 bullbullbullbullbullbullbullbullbullbullbullbullbull 3312 Water for yard locomotives 17360 19948 2588 Lubricants for yard locomotives 83523 109472 25949 Other supplies for yard locomotives Enginehouse expenses-Yard

49721 498339

48817 542983

904

44644

Yard supplies and expenses Operating joint yards and terminals-Debit Operatin~ joint yards and terminals-Credit Train engInemen Train fuel Train power purchased Water for train locomotives

466959 5790981 (683719)

9533667 7243332

864933 94310

441246 5978628 (685475)

9966568 7758783

907295 105164

25713 middot bull bullbull 0 bullbullbullbullbullbullbullbullbullbull 0

middot

187647

(1756) 432901 515451 42362 10854

Lubricants for train locomotives 795622 938600 142978 Other supplies for train locomotives Enginehouse expenses-Train Trainmen

210707 1124921

12091384

202708 1222756

12613963

7999 bullbullbullbull 0 bullbullbullbullbullbullbull bullbullbullbull

97835

522579 Train supplies and expenses 6340264 6660876 320612 Operating sleeping cars 715113 526531 188582 Signal and interlcker operation CrOSSIng protectIOn

1049887

721750 1037947

806370 11940

middot

84620 Drawbridge operation 215086 258082 42996 Communication system operation 1060497 1081772 21275 Operating Boating equipment 11796 10985 811 Srationery and printing 412827 392820 20007 Other expenses 817489 848149 30660 Operating joint tracks and facilities-Debit 1170056 1311393 141337 Operating joint tracks and faciliries-Credir Insurance

(786053)

78437 (751937)

92514 (34116)

14077 Clearing wrecks Damage to property

265853 120728

230128 206210

35725

85482

Damage to live stock on right-of-way Loss and damage-Freight

80817

2795442 53816

2942960 27001

147518 Loss and damage-Baggage 5528 722 4806 Injuries to persons 1708733 1714453 5720

TOTAL TRANSPORTATION EXPENSES 93769244 97849648 4080404

MISCELLANEOUS OPERATIONS Dining and buffet service 2855845 2888241 32396 Operaring joint miscellaneous facilities-Debit 149757 207418 57661

J------J------I-------I------shyTOTAL MISCELLANEOUS OPERATIONS 3005602 3095659 90057

GENBRAL Salaries and expenses of general officers 1421416 1331832 89584 Salaries and expenses of clerks and attendants 6821635 6920559 98924 General office supplies and expenses 753564 727092 26472 Law expenses 831662 811940 19722 Insurance 33708 6002 27706 Pensions and gratuities 818190 917286 99096 Stationery and priming 348137 336267 11870 Valuation expenses 53068 59453 6385 Other expenses 501292 520844 19552 General joint faciliries-Debit 258783 241859 16924 General joint faciliries-Credit (8615) (8933) (318)

TOTAL GENERAL EXPENSES 11832840 11864201 middot 31361

GRAND TOTAL RAILWAY OPERATING EXPENSES $187929803 $198851581 $10921778

( ) Denotes contra items

27

bullbullbull

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

ANALYSIS OF INCREASES AND DECREASES IN TOTAL RAILWAY OPERATING EXPENSES 1960 COMPARED WITH 1959

MAINTENANCE MAINTENANCE TRANSshyITEMS OF WAY AND OP ALL OTHER TOTALPORTATIONSTRUCTURES EQUIPMENT

LABOR General wage increases + $ 360933 + $ 323486 + $1370434 + $ 289045 + $ 2343898 Straight time worked - 2213317 - 2135307 - 4273302 - 680973 - 9302899 Overtime worked - 76922 - 10613 - 163702 9398 - 241839+ Time paid for not worked (incl vacations and holidays) - 100783 - 137170 - 123771 33475 - 323249+

TOTAL LABOR - 2030089 - 1959604 - 3190341 - 344055 - 7524089

FUEL Price middot middot middot - 375791 - 375791 Consumption middot middot middot - 204910 - 204910

TOTAL FUEL middot middot middot middot - 580701 middot - 580701

ELECTRIC POWER middot bullbullbullbullbullbull to middot middot - 45674 middot - 45674

MATERIAL-Ocher than fuel Price + 106251 112344 - 1059 17453 234989 Quanticy - 1181388 - 900335 201128 34210 - 1846385

+ + + + +

TOTAL MATERIAL OTHER THAN FUEL - 1075137 - 787991 200069 51663 - 1611396+ + MISCELLANEOUS

Health and welfare benefits - 38735 - 60626 - 57909 - 15652 - 172922 Other miscellaneous - 624726 - 954691 - 405848 19015 - 1966250+

TOTAL MISCELLANEOUS - 663461 - 1015317 - 463757 3363 - 2139172+ TOTAL LABOR MATERIAL AND MISCELLANEOUS - 3768687 - 3762912 - 4080404 - 289029 - 11901032

DEPRECIATION + 74566 323399 middot + 397965+ middotRETIREMENTS - 44133 625422 middot + 581289+

TOTAL DEPRECIATION AND RETIREMENTS + 30433 948821 middot middot + 979254+ TOTAL RAfLWAY OPERATING EXPENSES - $3738254 - $2814091 - $4080404 289029 - $10921778-I $

RAILWAY OPERATING REVENUES EXPENSES TAXES AND INCOME BY MONTHS FOR THE YEAR ENDED DECEMBER 31 1960

1960

RAILWAY OPERATING REVENUES

RAILWAY OPERATING

EXPENSES

NET REVENUE FROM

RAILWAY OPERATIONS

RAILWAY TAX

ACCRUALS

RAILWAY OPERATING

INCOME

EQUIPMENT RENTS-NET

DR

JOINT FACILITY

RENTS-NET DR

NET RAILWAY OPERATING

INCOME

January $ 17336067 $ 15803272 $ 1532795 $ 1670000 $ (137205) $ 422175 S 231113 $ (790493) February 18493440 15151942 3341498 1673000 1668498 490735 234172 943591 March 19025746 15902966 3122780 1695000 1427780 686903 219282 521595 April bull 18042813 15280563 2762250 1684000 1078250 586443 251268 240539

May 18975935 16148830 2827105 1728000 1099105 824503 181449 93153 June 19011723 16297457 2714266 1727000 987266 803292 217671 (33697) July 18796482 15947748 2848734 1728000 1120734 823376 203289 94069 August 23377375 17022049 6355326 1806000 4549326 1420370 316997 2811959

September 20166066 15953895 4212171 1685000 2527171 1100653 248649 1177869 October 20925500 14736878 6188622 1647000 4541622 980838 252319 3308465 November 18549759 14797644 3752115 1620000 2132115 848876 267507 1015732 December 17661996 14886559 2775437 1474000 1301437 791725 238186 271526

Total $230362902 $187929803 $42433099 $20137000 $22296099 $9779889 $2861902 $9654308

( ) Denotes contra items 28

ANNUAL REPORT FOR 1960

REVENUE FREIGHT TRAFFIC STATISTICS-EXCLUDING TRUCK SERVICE

FREIGHT REVENUE AVERAGE

TONS TONSYEAR HAUL- PERCARRIED MILES PER

MILES TOTAL TON MILETON

(CENTS)

1951 51740580 16732323827 32339 $217832219 $421 1302 1952 49522089 16005309995 32320 222648097 450 1391 1953 46810989 15413226569 32927 215622726 461 1399 1954 43123214 14178678856 32879 197712105 458 1394 1955 45481060 95561748530 34216 205993029 453 1324

1956 45351213 15612344863 34425 209886542 463 1344 1957 42915573 14614118553 34025 212631339 495 1455 1958 40117213 13884510331 34610 205489920 512 1480 1959 40199394 14121939599 35130 201705278 502 1428 1960 38305568 13604642301 35516 189750236 495 1395

REVENUE PASSENGER STATISTICS-EXCLUDING BUS SERVICE

PASSENGER REVENUE AVERAGE

PASSENGERS PASSENGER DISTANCE PER YEAR

CARRIED MILES TRAVELED PER PASSENGER TOTAL

-MILES PASSENGER MILE (CENTS)

OTHER THAN COMMUTATION

1951 3341410 776958568 23252 $ 18484470 $553 2379 1952 3346346 739380708 22095 17569369 525 2376 1953 3158639 658842799 20858 15396026 487 2337 1954 3057733 599281006 19599 13582309 444 2266 1955 3003108 571128913 19018 12413340 413 2173

1956 3266663 696906549 21334 15758692 482 2261 1957 2943819 587947230 19972 14064509 478 2392 1958 2889740 549258597 19007 12969955 449 2361 1959 1839572 523514965 28459 12490275 679 2386 1960 1759253 515650913 29311 12095377 688 2346

CoMMUTATION

1951 4186842 94960045 2268 $ 1251058 $ 30 1317 1952 3899249 89299292 2290 1325955 34 1485 1953 3823231 88929041 2326 1316554 34 1480 1954 3920824 93543801 2386 1374494 35 1469 1955 4176751 98901556 2368 1463125 35 1479

1956 4150616 100135407 2413 1474073 36 1472 1957 4074228 98630820 2421 1463767 36 1484 1958 4338777 103055843 2375 1567002 36 1521 1959 5521115 123694172 2240 2818185 51 2278 1960 5036666 111139202 2207 3095340 61 2785

TOTAL

1951 7528252 871918613 11582 $ 19735528 $252 2263 1952 7245595 828680000 11437 18895324 261 2280 1953 6981870 747771840 10710 16712580 239 2235 1954 1955

6978557 7179859

692824807 670030469

9928 9332

14956803 13876465

214 193

2159 201

1956 7417279 797041956 10746 17232765 232 2162 1957 7018047 686578050 9783 15528276 221 2262 1958 1959 1960

7228517 7360687 6795919

652314440 647209137 626790115

9024 8793 9223

14536957 15308460 15190717

201 208 224

2229 2365 2424

BeglOnmg With year 1959 lOcludes cash fares single and round trip tickets sold for travel within suburban area which in prior yeaTS were included in Other than Commutation

29

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

STATISTICS OF OPERATIONS

TOTAL TRANSPORTATIONFREIGHT TRAINS PASSENGER TRAlNS SERVICE ITEMS I

1960 1959 1960 1959 1960 1959

RAlL-LINE Average miles of road operared 1 1deg--589_1---1deg586=_-------34-=68 -1-__394-=-9_1-----=10--597-1---I0-594=-

TRAlN MILES

Ordinary (wirh locomorives) 9554242 10152235 6185162 6740403 15739404 16892638 Ligh t (with locomotives) 1_----27--3-59_ 1__-----_24----42-=5_ 1_middot_-----=--------_1 __---c-_o---=-_ 1_--=-2~73-50-9_1_---2442-5_

Total (with locomotives) 9581601 10176660 6185162 6740403 15766763 16917063 Motor car trains bull middotICmiddotmiddotmiddotmiddot~ ----1----=----middotmiddot_1----------1~7-o1_=_60--1-____=_=65--4_8__7+--=-=-1-721-6_0-1-_________65_--487-

Total train miles 1_ __=9 0-58_1--6_deg 1 1__1deg 176--=66_deg--1 60-2_0_23_22_1 __68_0_5 89_deg_1 __15--7_83-923_1 __16--bull98_2-0-550_

LOCOMOTIVE MILES

Principal 9583849 10180397 6185162 6740403 15769011 16920800 Helper 81260 109822 286 726 81546 110548 Lig~t 104438 151874 35078 49266 139516 201140 TraIn sWItchIng 856137 864118 bull bull 856137 864118 Yard switching 1_ __=5-58757--2_1_--=-58---62-=-6-=48=_1 __~4--28-0-54__=31__--441--949-1 __60161_15_1 __630_4--59-=-7

Total locomotive miles 1-162213--2561----=-17-168859=_1---=6649-deg-=69=-1----723-234-4+2=2c862325_1_---=-24401203=_

CAR MILES

Loaded freight cars 431972870 466352092 517228 101495 432490098 466453587 Empty freigh tears I~26624=2gt490_127-=325-=-3~4~594-1------=--5==-- bull6471=-1------=-=-5o-6_01---266--248gt13--1_ 1-27-3gt5-35-154=-

Total loaded and empty freight cars 698215360 739886686 522869 102055 698738229 739988741 Caboose 1~_9285~9235-=-5-1-~1023=2-=-9-651=-1------=_1~--2101------=-~2~1~1=7--1-~9~86-0--5-6--5-1-=-1=_=0--33__1--7--68--

Total freight car miles 17deg8gtdeg742715-1-7502216233~7 1_----=524-079=-1_---=104172_ 1-7deg825982794=-1 _---750-320509=_

Passenger coaches 4913 3974 22864172 23715856 22869085 23719830 Sleeping and parlor cars (Company) 1812568 1817919 1812568 1817919 Sleeping cars (Pullman) 38383 35410 12685592 13337316 12723975 13372726 Club lounge dining and observation cars 547 bull 4989125 5250522 4989672 5250522 Combination passenger and head end cars 501995 659233 169149 142633 671144 801866 Mail express and baggage cars 2570197 2539863 21120653 22269656 23690850 24809519 Business cars 1---=--3-6~66-41--=-=---44---1-5 133-deg82_ 1_-----1--49-=-3deg8_ 1_--16-=-974-=6_1_-----_193---4657-_ 1_----shy

Total passenger car miles I~--=3215226~99-1-__=__3~282=63=__7_1-63-7--7--4~3--41_1--6-6-6-83-21--0+-66--9-2 65--847shy72deg4deg+-=-=-69--9--Grand total car miles 1 7_11 _227--4_1_4_1 753 498-974_1_6_429_84_2deg---1_6_67_8_7--=3_8_2_ 775 525--8--=34_ __8_2deg_2_86--bull356_

1 1

GROSS TON MILES

Locomotives and tenders (thousands) 1_ __=3-3942655-1 __3450-518--1__2--0_4_22_10---1 __21_6--2 1-13_ _---=5 436--865_ __5--612__=6311 1Freight cars contents and cabooses (thousands) 31409774 32603899 23551 4151 31433325 32608050 Passenger cars and contents (thousands) 1---1632517-1---------=-1670109=-1---41deg29-=-95_1--42999-8--4-1---4--26625o-12=-1------4=467o-O973=-

To tal freig ht and passenger (th0 usands) 1 31 57322-911_----32-- 771degdeg8=_1 41_265_46_ 1__4--=30_4 135_1 35--699--8__=37_ ____=_37-- 075_14__=3-shy1

TRAIN HOURS

Train hours in road service 473544 507565 137163 154436 610707 662001

REVENUE AND NONREVENUE FREIGHT TRAFFIC Tons of revenue freight ~8305568 40199394 Tons of nonrevenue freight middot1middotmiddotmiddot--- middotmiddot-=middot1middot---middotmiddotmiddotmiddot--- middotmiddot-1middotmiddot---middot---middotmiddotmiddot--- cl __ __ middot_middotmiddotmiddot1 _=-=-8421=-=35_ 1-------1_=_deg6--deg-53-7shy

Total tons of freight IC--- I~ +bull--- 1 --- ---1 392147-7deg3_1_---=-41=2-59093-1 Net ton miles revenue freight (thousands) 13604642 14121940 Net ton miles nonrevenue freight (thousands) middot1-middotmiddot--middot-middot=~-c- -1-------------middot1middotc----c_c I_____--_middot~middot-middotmiddotI_=-=---25797-5179c+----=-3_=_81c-0=-36--

Total net ton miles of freigh t (thousands) 1_c138530726=_1----=-145021~3=-301--104~35 _1 1646_1-1386421611----=-145deg2976

REVENUE PASSENGER TRAFFIC

Passengers carried 6795919 7360687 Passenger miles 626790115 647209137

MOTOR VEHICLE OPERATIONS EXCLUDED ABOVE Net ton miles revenue freight (thousands) 1124 1318 Passengers carried 995 1914 Passenger miles 1041447 991687

30

ANNUAL REPORT FOR 1960

STATISTICS OF OPERATIONS-CONCLUDED

-ITEMS 1960 1959 1958 1957 1956 1955

FREIGHT TRAIN STATISTICS AND AVERAGES

Gross ton miles trailing (thousands) 31573291 32771008 32413288 34236747 36203655 36228284

Eastbound 17124676 18176737 18125895 18805435 19734331 19787705 Westbound 14448615 14594271 14287393 15431312 16469324 16440579

Steam middot middot 135 133258 Dieselmiddotelectric 29107869 29901296 29705585 31129417 32597742 32536016 Electric 2465422 2869712 2707703 3107330 3605778 3559010

Per cent steam - middot 4 Per cent Dieselmiddotelectric 922 912 916 909 900 898 Per cent electric 78 88 84 91 100 98

Loaded freight cars per train 452 459 443 443 446 434 Empty freigh t cars per train 279 270 277 267 247 235

Total freight cars per train 731 729 720 710 693 669

Gross tons per train - 3305 3228 3157 3117 3070 2969 Net tons per train 1450 1428 1390 1373 1370 1323 Net tons per loaded car 321 311 313 310 307 305 Miles per car per day (serviceable freight) 393 390 357 370 387 377 Net ton miles per freight car-day 736 734 655 673 715 702 Train speed (train miles per train hour) 202 200 196 192 191 190 Gross ton miles (trailing) per train hour 66674 64565 61714 59780 58328 56315

PASSENGER TRAIN STATISTICS AND AVERAGES

Passenger car miles (excluding motor) - 64230016 66525240 69087808 75256765 86613202 72582117

Steam middot 13184 16967 Dieselmiddotelectric 64227781 66502614 65218200 71665998 81157901 66905429 Electric 2235 22626 3869608 3590767 5442117 5659721

Per cent steam middot Per cent Diesel-electric 1000 1000 944 952 937 922 Per cent electric middot 56 48 63 78

Cars per train (excluding motor) 1038 987 960 960 984 891 Revenue passengers per train 1012 952 898 865 894 812 Revenue passengers per car 166 165 161 160 168 175 Train speed (train miles per train hour) 452 441 444 439 447 429

YARD SWITCHINGSTATISTICS

Yard switching hours 1002686 1Oi0766 1063803 1184130 1251620 1274248

Steam middot 7 11279 Dieselmiddotelectric 994370 1038534 1056660 1174874 1235025 1246748 Electric 8316 12232 7143 9256 16588 16221

Per cent steam middot middot 9 Per cent Dieselmiddotelectric 992 988 993 992 987 978 Per cent electric 8 12 7 8 13 13

DENSITY STATISTICS

Per mile of road per day (freight service) Train miles ordinary Net ton miles

Per mile of road per day (passenger service) Train miles Car miles

25 3575

49 507

26 3753

47 463

27 3694

48 455

28 3896

47 450

30 4153

53 517

31 4161

48 425

31

CHICAGO MILWAUKEE ST PAUL AND PACIFIC RAILROAD COMPANY

REVENUE FREIGHT BY PRINCIPAL COMMODITIES-1960 AND 1959

INCREASE + OR1960 1959 DECREASE shyCOMMODITIES

TONS CARRIED

PERCENT OF TOTAL

TONS CARRIED

PERCENT OF TOTAL TONS PERCENT

PRODUCTS OF AGRICULTURE Wheat Corn Batley and tye Oats shy

Flour meal and mill products Citrus fruits Other fruits fresh and frozen

1708445 1325050

763672 347413

1275613 39049

123945

45 35 20

9 33

1

3

1653685 1281473

738948 298327

1242503 59289

135892

41 32 18 7

31 2 3

+ + + + + --

54760 43577 24724 49086 33110 20240 11947

33 34 33

165 27

341 88

Potatoes other than sweet 0 0 bull 229982 6 264312 7 - 34330 130 Other vegetables fresh and frozen Sugar beets Other products of agriculture

115520 213813

1588516

3

6 41

126388 191132

1480059

3

5 37

-+ +

10868 22681

108457

86 119

73 Total 7731018 202 7472008 186 + 259010 35

ANIMALS AND PRODUCTS Cattle calves sheep and goats 171861 4 198623 5 - 26762 135 Swine 21999 1 33892 1 - 11893 351 Fresh meats 386670 10 427610 10 - 40940 96 Poultry eggs butter and cheese 113551 3 128422 3 - 14871 116 Wool hides and leather 153604 4 161264 4 - 7660 47 Other animals and products 268968 7 265237 7 + 3731 14

Total 1116653 29 1215048 30 - 98395 81

PRODUCTS OF MINES Bituminous coal 4862060 127 5447866 136 - 585806 108 Coke 257305 6 296121 7 - 38816 131 Ores and concentrates Gravel and sand

462461 916755

12 24

385162 1166550

10 29

+ -

77299 249795

201 214

Stone broken ground or crushed Stone rough and finished Asphalt

1291164 77997

195521

34 2 5

1192897 71099

234070

30 2 6

+ + -

98267 6898

38549

82 97

165 Salt 148276 4 165384 4 - 17108 103 Other products of miles 1138894 30 1154731 28 - 15837 14

Total 9350433 244 10113880 252 - 763447 75

PRODUCTS OF FORESTS Logs posts poles and cordwood 1290191 34 1604736 40 - 314545 196 Pulpwood 1028793 27 966773 24 + 62020 64 Lumber and mill products 1845337 48 2434155 61 - 588818 242 Veneer and builtup wood 467827 12 520054 13 - 52227 100 Other products of forests 376413 10 259064 6 + 117349 453

Total 5008561 131 5784782 144 - 776221 134

MANUFACTURES AND MISCELLANEOUS Refined ~etroleum and products 1175165 31 1258601 31 - 83436 66 Sugar ta Ie syrups and molasses Iron and steellroducts

304542 2251993

8 59

293861 2299049

7 57

+ -

10681 47056

36 20

Machinery an boilers 222962 6 230072 6 - 7110 31 Cement Brick building tile and artificial stone

1242018 191608

32 5

1152635 199113

29 5

+ -

89383 7505

78 38

lime and plaster 73696 2 81785 2 - 8089 99 Agricultural implements traCtors and parts 155626 4 206217 5 - 50591 245 Autos trucks parts and tires Beverages

745090 599592

19 16

685152 613561

17 15

+ -

59938 13969

87 23

Ice 32950 1 31716 1 + 1234 39 Fertilizers Paper and paper products

590481 1191363

15 31

535770 1200754

13 30

+ -

54711 9391

102 8

Canned food Jroducts 985346 26 997315 25 - 11969 12 Scrap iron an scrap steel 598594 15 758925 19 - 160331 211 Building paper roofing and woodwork 434465 11 460040 12 - 25575 56 Other manufactures and miscellaneous 4165926 109 4435508 110 - 269582 61

Total 14961417 390 15440074 384 - 478657 31

GRAND TOTAL CARLOAD TRAFFIC 38168082 996 40025792 996 - 1857710 46

ALL lCl FREIGHT 137486 4 173602 4 - 36116 208

GRAND TOTAL CARLOAD AND lCi TRAFFIC 38305568 1000 40199394 1000 - 1893826 47

32

ANNUAL REPORT FOR 1960

NUMBER OF EMPLOYEES AND COMPENSATION

REGULAR EMPLOYEES TOTAL COMPENSATION ALL EMPLOYEES PART TIME

EMPLOYEES CHARGED ToAVERAGE CoMPENSATION

YEAR Noop

EMPLOYEES (MIDDLE

OP MONTH COUNT)

CoMPENSATION

AVERAGE COMPENSATION

PER EMPLOYEE

(NOT SUBJECT TO

CONTINUING AUTHORITY

OP RAILROAD)

TOTAL COMPENSATION OPERATING

EXPENSES

ADDITIONS AND

BETTERMENTS AND OTHER ACCOUNTS

1928 48129 $ 81744769 $1698 $135855 $ 81880624 $ 75548543 $ 6332081 1933 26493 39042823 1474 129469 39172292 36740362 2431930 1938 28988 52830262 1822 100092 52930354 48224635 4705719 1943 35377 90305409 2553 145093 90450502 84109945 6340557 1948 38268 138490345 3619 172016 138662361 126543269 12119092 1950 33668 128201025 3808 167342 128368367 121226784 7141583 1951 33846 143260363 4233 219693 143480056 134493624 8986432 1952 32550 145397263 4467 149515 145546778 138390501 7156277 1953 31138 138117562 4436 145500 138263062 131304863 6958199 1954 27961 126272397 4516 143400 126415797 120564532 5851265 1955 27936 126447937 4526 139330 126587267 120732130 5855137 1956 27408 134534522 4909 123452 134657974 126936601 7721373 1957 26007 133239878 5123 117455 133357333 125221025 8136308 1958 23402 128237334 5480 119269 128356603 123103272 5253331 1959 middotmiddot 22243 128292584 5767 107083 128399667 122031078 6368589 1960 20229 121037664 5983 98143 121135807 114993442 6142365

NUMBER OF EMPLOYEES AND COMPENSATION BY STATES

REGULAR EMPLOYEES PART TIME TOTAL

AVERAGE EMPLOYEES COMPENSATIONSTATE

AVERAGE TOTAL CoMPENSATION TOTAL ALL NUMBER COMPENSATION PER COMPENSATION EMPLOYEES

EMPLOYEE

Illinois bull 5977 $ 35954281 $6015 $18179 $ 35972460 Iowa 2062 12410458 6019 5105 12415563 Wisconsin bull 5272 30334008 5754 21200 30355208 Minnesota 2446 14392068 5884 8726 14400794

122 906621 7431 0 906621~~~~~fmiddotmiddotmiddotmiddotmiddot 346 2035311 5882 10780 2046091 Indiana 289 1726773 5975 9180 1735953 South Dakota 902 5244002 5814 180 5244182 North Dakota bullbull 98 524782 5355 2599 527381 Moncana bull 1060 6740641 6359 22074 6762715 Idaho 94 574143 6108 0 574143 Washington 1412 9145616 6477 120 9145736 All otherbullbullbullbullbull 149 1048960 7040 0 1048960

Total 20229 $121037664 $5983 $98143 $121135807

TOTAL PAYROLLS AND COMPANY CONTRIBUTIONS AVERAGE PER EMPLOYEE

COMPANY CoNTRIBUTIONS STRAIGHT TIME RATETOTAL AVERAGE

PAYROLLSshyYEAR RETIREMENT AND HEALTH AND TOTAL PER AVERAGE INCREGULAR

UNEMPLOYMENT WELPARE EMPLOYEE PER OVEREMPLOYEES TAXES BENEFITS HOUR 1939

1950 $128201025 $7234363 $135435388 $4023 $1580 1179 1951 143260363 7774582 151034945 4463 1754 1419 1952 145397263 7696578 153093841 4703 1852 1554 1953 138117562 7441326 145558888 4675 1895 1614 1954 126272397 7035232 133307629 4768 1945 1683 1955 126447937 7276300 $ 624381 134348618 4809 1959 1702 1956 134534522 8581092 1403449 144519063 5273 2130 1938 1957 133239878 8692650 2106181 144038709 5538 2290 2159 1958 128237334 8420346 1934613 138592293 5922 2465 2400 1959 128292584 9894538 1819163 140006285 6294 2566 2539 1960 121037664 9969699 1646241 132653604 6558 2638 2639

33