Ohio History Journal

DOUGLAS V. SHAW

Interurbans in the Automobile Age:

The Case of the Toledo, Port Clinton

and Lakeside

From the first decade of the twentieth century until the early 1930s electric

interurban railways connected almost all Ohio towns and villages of more

than 5000 population. With its numerous cities and market towns within

reasonable proximity of one another, prosperous agriculture, and generally fa-

vorable topography everywhere but in the southeast, Ohio provided ideal terri-

tory for interurban development. Promoted vigorously from 1890 until 1910,

interurbans quickly became important components of regional transport sys-

tems; at the industry's height between 1914 and 1918 the Ohio system

reached its maximum of roughly 2800 miles.¹

Built and operated in many respects like urban street railways, interurbans

offered greater frequency of passenger service and more rapid delivery of local

freight than did steam railroads. Most offered service at no less than two-hour

intervals, headways far shorter than those maintained on typical local railroad

lines. Increased convenience and flexibility formed the core of interurban suc-

cess, and electric lines tended to replace steam roads as the transport mode of

choice between points where the two competed directly for traffic.² Yet in the

long run the industry was not a success. Most interurbans never developed

Douglas V. Shaw is Associate Professor of Urban Studies in the Department of Urban

Studies, The University of Akron.

1. George W. Hilton and John F. Due, The Electric Interurban Railways in America, second

printing (Stanford, 1964), 4-25; Report of the Public Utilities Commission of Ohio for the Year

1917 (Springfield, Ohio, 1918), 645 (hereafter abbreviated as PUCO Report, [year]); George

S. Davis, "The Interurban Electric Railways of Ohio," Street Railway Journal, 18 (August 3,

1901), 145-56. See also "The Latest Ohio Interurban Map," Street Railway Review, 12 (March

20, 1904), 190-91.

2. Hilton and Due, 14-15; Guy Morrison Walker, "The Why and How of Interurban

Railways," Street Railway Review, 14 (June 20, 1904), 365-68; Ernest L. Bogart, "Economic

and Social Effects of the Interurban Electric Railway in Ohio," Journal of Political Economy,

14 (December, 1906), 588-92. Within four years of the opening of the Interurban Railway and

Terminal Company between Cincinnati and Lebanon in 1902, for example, passenger traffic

on the Cincinnati, Lebanon and Northern steam railroad fell 59 percent. John W. Hauck,

Narrow Gauge in Ohio: The Cincinnati, Lebanon and Northern Railway (Boulder, 1986), 226-

27. On the development of freight traffic, see Charles S. Pease, Freight Transportation on

Trolley Lines (New York, 1909).

126                                                        OHIO HISTORY

sufficient traffic and revenue levels to assure financial stability and few in-

terurbans ever paid consistent returns on their investment for very long. After

1925 lines were abandoned as rapidly as they had been built before 1910, un-

able to meet their fixed charges as traffic dwindled in the face of competition

from automobiles, buses, and trucks. Indeed, toward the end many lines pro-

duced more net revenue from the sale of electricity to communities and farms

along their rights-of-way than from the sale of transportation itself.³

The Toledo, Port Clinton & Lakeside provides an excellent illustration of

the aspirations, insurmountable difficulties and dashed hopes of the interurban

industry. Completed in 1906 between Toledo and the end of the Marblehead

peninsula to the east, the road lost money during every year of its existence

when all proper charges are computed. Yet the line did not discontinue pas-

senger service until 1939, one of the last in the state to do so. Owned for all

but its first seven years by utility holding companies willing to underwrite its

losses, the Toledo, Port Clinton & Lakeside avoided the bankruptcy and aban-

donment which would have been its certain fate had it continued as an inde-

pendent corporate entity. Because it survived so long its records allow explo-

ration of the manner in which this interurban and others interacted with the

development of automotive transport and with increased demand for electricity

in its service area.⁴

The Early Years, 1902-1912

The Toledo, Port Clinton & Lakeside was incorporated in late 1902 by a

group of wealthy and well-connected Toledo businessmen. By linking the

Marblehead peninsula in Ottawa County with Toledo they expected to secure

much of the heavy seasonal tourist traffic to peninsula and island resorts and

to the large Methodist camp at Lakeside. They also expected the area's lime-

stone and gypsum mines and highly productive farms and fruit orchards to

supply a respectable freight traffic. Securing franchises to lay track on village

streets in Genoa, Oak Harbor, Port Clinton and Marblehead in the spring and

summer of 1903, the company prepared to build.⁵

3. Hilton and Due, 54, 208-51; "Selling Energy Along Interurban Railways," Electric

Railway Journal, 48 (October 28, 1916), 920-25.

4. The records of the Toledo, Port Clinton & Lakeside and successor companies are part of

the Ohio Edison collection, housed in the American History Research Center, University of

Akron Archives, University of Akron, Akron, Ohio. See also George Hilton's excellent The

Toledo, Port Clinton and Lakeside Railway, Bulletin No. 42, Electric Railway Historical Society

(Chicago, 1964).

5. Hilton, 3-4; "Toledo, Port Clinton and Lakeside," Street Railway Journal 26 (December

30, 1905), 1130-32; "Annual Report of the Toledo, Port Clinton and Lakeside Railway to the

Railroad Commission of Ohio for the Year Ending June 30, 1908" (hereafter abbreviated

"TPC&LS Railroad Commission Report," 1907-08), 16, 18, Box 157, Ohio Edison papers

128                                                      OHIO HISTORY

Company. This entry took the road through several minor villages not oth-

erwise served, but it added slightly more than three miles and about fifteen

minutes to the more direct route from Genoa to Toledo taken by the Lake

Shore. Clearly, the road's promoters placed a higher value on maximizing

the population served than on speed of service to and from the Marblehead

peninsula, a calculation unaffected by the prospect of automobile competition

and the less forgiving definitions of speed and convenience that accompanied

mass automobile ownership.⁶

The TPC&LS was an exceptionally well-designed and well-built interurban.

Constructed with a solid roadbed and shallow curves under the supervision of

railroad engineer Herbert C. Warren, the road could support railroad freight

cars, facilitating traffic interchange with steam roads. Its brick powerhouse,

located along the Lake Erie shore-line at Port Clinton close to abundant cool-

ing water, and its electrical distribution system received approving reviews in

Street Railway Journal and Railway Age, as didits attractive stations in the

communities through which it passed. At the same time, some components

showed more interest in economy than in permanence: its 143,000 cross ties

and 3800 electrical distribution poles, for example, were of untreated wood,

assuring earlier replacement than more durable alternatives. On balance, how-

ever, there can be little doubt that the road's promoters intended their invest-

ment to be long-lasting and they built to a generally high standard.⁷

On February 20, 1907, the construction company turned the completed road

over to the Toledo, Port Clinton & Lakeside. The company received a single-

track electric interurban railway, 50.70 miles long with 3.15 miles of

turnouts and sidings, entering Toledo on the east over the tracks of the Toledo

Railway & Light Company. The road cost a total of $1,350,000 to con-

struct, an amount almost equal to the face value of the $1,500,000 five per-

cent first-mortgage bonds. The $1,800,000 in common stock, then, did not

represent tangible assets, and in the language of the day, the TPC&LS was a

typically "watered" corporation. Using the terminology of a more recent and

more tolerant generation, the road was 100 percent debt-financed through

"junk" bonds and highly leveraged; its stock could attain value only if the

road developed a cash flow sufficient to generate a healthy surplus for divi-

6. Hilton, 5-9, "Toledo, Port Clinton and Lakeside," Street Railway Journal, pp 1130-32;

"TPC&LS Railroad Commission Report," 1907-08, 16, 18, Box 157, OE papers. In Toledo the

company paid 3.5 cents per passenger carried and a percentage of freight charges to the

Toledo Railway and Light Company for trackage rights.

7. Hilton, 5-8; "The Toledo, Port Clinton and Lakeside," 1130-38; "Toledo, Port Clinton and

Lakeside," Railway Age 41 (May 11, 1906), 794-96. "Annual Report of the Toledo, Port

Clinton and Lakeside Railway Company to the Tax Commission of Ohio for the Year Ending

January 1, 1911" (hereafter abbreviated "TPC&LS Tax Commission Report," 1910), 43, Box

156, OE papers. The company used 70 pound-per-yard T-rail, the customary weight in the

interurban industry. Ibid., Hilton and Due, 48.

Interurbans in the Automobile Age                                      129

dends after paying all operating expenses, taxes, and the annual bond interest

charge of $75,000. How the bonds were placed is not known. The stock,

however, remained in friendly hands, with the construction company retaining

a third and company promoters and their families controlling another 40 per-

cent. Most of the rest was held in lots of twenty shares or less, primarily by

people in communities through which the road passed; in many cases the

stock probably represented payment to rural property owners for roadside right

of way.⁸

Although Street Railway Journal enthused that the "features which go to

make an interurban line successful are peculiarly combined" on the

Marblehead peninsula, success proved elusive. While the road's promoters

projected summer tourism as a major revenue source, the tourist season lasted

a scant three months. Terminating on a peninsula, the railway could hardly

participate in intercity through traffic, except indirectly via lake boat to

Sandusky across the bay, and then only during the shipping season. The

largest village through which the road passed, Port Clinton, the county seat

of Ottawa County, had a 1910 population of 3,000. Hence the road would

have to rely for most of the year on whatever local traffic rural Ottawa

County's 20,000 people could provide.

A review of the company's operation and finances between 1908 and 1912

illustrates its inability to generate sufficient traffic to cover its costs even be-

fore the automobile developed as a serious competitor. Intended primarily as

a passenger road, the railway carried 782,766 revenue passengers for the year

July 1, 1907, through June 30, 1908,⁹ the first full year following entry into

Toledo, dipped to 738,413 in 1910-11 and then climbed to 781,600 in 1911-

12. Passenger revenue ranged from $120,200 in 1908-09 to $148,200 in

1911-12. Freight traffic showed more consistent growth; revenues doubled

from $18,900 in 1907-08, to $37,800 in 1911-12.10

8. Hilton, 9; "TPC&LS Railroad Commission Report," 1907-08, 11, 15, 59-60a, Box 156,

OE papers.

9. The Railroad Commission and its successors, the Public Service Commission (PSC) and

Public Utilities Commission (PUCO), required annual reports covering July 1 through June 30

of the following year until 1916 when the PUCO changed to calendar year reporting. State

reports duplicated Interstate Commerce Commission reports exactly and covered the same time

spans. PUCO and ICC reports required financial and operating data. Reports to the Tax

Commission of Ohio included financial and detailed property ownership data, but not operating

data, on a calendar year basis. Figures often differ slightly from report to report, even when

covering the same time period, but seldom by as much as one percent. To reflect this lack of

uniformity and precision, as well as to improve readability, I have generally rounded figures to

the nearest hundred or thousand.

10. "TPC&LS Railroad Commission Reports," 1907-08, 21, 45, 1908-09-1910-11, 35, 65,

"TPC&LS PSC Report," 1911-12, 35, 65, Box 157, OE papers.

Interurbans in the Automobile Age                                   131

fruit harvest in September when the company ran twice the freight car

mileage as it averaged in non-harvest months.¹²

Revenue peaked even more sharply than traffic. Tourists to peninsula and

island resort areas rode further and paid higher fares than did Ottawa County

residents using the railway for local travel. In 1911 the average fare paid be-

tween January and June was 14.5 cents, indicating an average ride of slightly

more than seven miles at the typical fare of two cents per mile, compared to

22.3 cents between July and December. Hence the railway collected 65.9 per-

cent of its passenger revenue in the second half of the year. Similarly, freight

charges per carload for handling perishable crops were considerably higher

than for hauling bulk commodities such as limestone and gypsum; in 1911

the TPC&LS earned 73.4 percent of its freight revenue in the second half.¹³

The TPC&LS seems to have been as well managed as it was well designed

and well built. A key measure of efficiency is the ratio of expenses to rev-

enues, known as the operating ratio. If operations were to consume all avail-

able revenue, there would be no remaining funds to cover fixed costs such as

bond interest or to allow payment of dividends on common stock. Operating

ratios above 60 percent tended to squeeze earnings on all but the strongest

roads.¹⁴ Between 1907 and 1911 the TPC&LS maintained an operating ratio

of between 50 and 57 percent, a good indication of competent management.

But the road never achieved the financial stability such a favorable ratio im-

plied, as the company failed to generate earnings sufficient to support its

heavy fixed charges. In spite of earlier rosy projections, traffic and revenue

levels were disappointing and insufficient to cover costs. The figures in

Table I (page 130) show that in spite of prudent management the road earned

its expenses in only two of its first five years and compiled a cumulative

deficit of more than $8,000. While the road's position improved after 1910

as gross income increased, these increases came almost entirely from im-

proved freight and electricity earnings. Passenger income remained nearly

constant and declined as a percent of gross income from 69.8 percent in 1907-

08 to 58.5 percent in 1911-12.15 The sharp seasonality of the railway

business helped to keep earnings low. In 1912 the company was profitable

for the year with an operating ratio of 58.2 percent, but this represented the

12. Figures are taken from work sheets used to total monthly traffic data pasted inside the

back covers of "TPC&LS Report to the Railroad Commission," 1910-11 and "TPC&LS Report

to the PSC," 1911-12, Boxes 156-57, OE papers.

13. Figures are taken from work sheets used to total revenues and expenses by calendar

halves pasted onto the inside front covers of Ibid.

14. Hilton and Due, 186-95.

15. "TPC&LS Railroad Commission Reports," 1907-08, 21, 1908-09--1911-12, 35, Box

156-57, OE papers. In comparison, the Lake Shore Electric Railway received 87.2 percent of

its 1911 income from passenger revenue, and the Cleveland Painesville and Eastern 80.5

percent. Electric Railway Journal, 40 (August 17, 1912), 262; (September 21, 1912), 465.

132                                                    OHIO HISTORY

average of an anemic 64.9 percent forthe first half and a healthy 50.4 percent for

the second. Because of low demand and idle capacity the company lost money

in the first half but then more than made up for it in the second; whatever

profits the TPC&LS earned came between the summer solstice andChristmas.¹⁶

The proceeds from the securities issued in 1903 had to fund not only con-

struction but also bond interest payments until the road began to produce in-

come. By the time the operating company took possession of the road in

early 1907, funds were pretty much depleted, and the lack of cash reserves,

coupled with the failure of the road to earn expenses in its early years, created

severe financial stresses. Unable to meet its full bond commitments consis-

tently, the company slowly fell behind in its interest payments and then, in

1908-09, began to cover its delinquency through short-term borrowing. By

June 1911 the company had reduced its interest arrears to $16,625, but in do-

ing so had acquired $45,550 in short-term debt. Only by juggling the de-

mands of short and long-term creditors was the TPC&LS able to remain sol-

vent. 17

Dismal as are the figures in Table I, they still understate the actual financial

situation of the TPC&LS. Mortgage bonds invariably required the issuing

corporation to assure their eventual redemption by contributing one to two

percent of the principal annually to a sinking fund. As the bonds of the

TPC&LS came due in 1928, the company needed to fund $1,500,00 by that

date. But as of 1911 the company had made no deposits to a sinking fund,

and clearly lacked the means to do so. Similarly, prudent accounting called

for the company to fund its depreciation so that as parts of the system wore

out funds would be on hand to purchase replacements. But the TPC&LS

maintained no depreciation reserve. Barely able to meet current demands, the

company lacked the resources to make prudent provision for future needs and

obligations.

These liabilities directly affected the company's value as an investment. In

early 1912 the Ohio Tax Commission questioned the company's failure to

state in its most recent annual report a market value for its bonds and com-

mon stock. Responding for the company, General Manager Theodore

Schmitt noted that neither set of securities had ever been listed on an ex-

change and that he was unaware of any offers for bonds "which would indicate

16. "TPC&LS Tax Commission Report," 1912, pp, 55, 63, Box 156, OE papers;

"Northwestern Ohio Railway and Power Company Tax Commission Report," 1912, 55, 63, Box

99, Ibid. It is possible to separate data for 1912 into approximate calendar halves the

Northwestern Ohio Railway and Power Company (NOR&P) bought the TPC&LS in July 1912.

The old company filed a report covering January-July; the new company filed two reports, one

covering July-December, and one covering the entire year.

17. "TPC&LS Railroad Commission Reports," 1906-07, p 17, 1907-08, 13, 1908-09-1910-

11, 17, 21; "TPC&LS PSC Report," 1911-12, 17, 21, Boxes 156-57, OE papers.

Interurbans in the Automobile Age                                     133

a market price"; the stock, he claimed, "has no market value." With no assets

backed by equity and no reasonable prospect of earnings to apply to dividends,

it is difficult to argue with Schmitt's somber conclusions.¹⁸

Others shared his pessimism. In 1912 Philadelphia banker Leslie M. Shaw

joined the company's board, its first member from outside the Toledo area.

President of First Mortgage Guarantee & Trust Company of Philadelphia,

Shaw undoubtedly represented bondholders unhappy with the road's failure to

meet its interest and sinking fund obligations and anxious to protect what re-

mained of their investment.¹⁹ In 1911-12 the company paid off its short-term

debt, but in the process fell a disastrous $87,600 behind in its interest pay-

ments. Bondholder discontent seems to have been the catalyst which shortly

thereafter forced the road's sale to General Gas and Electric.²⁰

The Middle Years, 1912-1924

General Gas and Electric Company, a utility holding company based in

New York City, agreed to purchase the Toledo, Port Clinton & Lakeside in

May 1912 for $1,100,000, a price the purchaser explained to the state Tax

Commission as representing original cost less accrued depreciation. After set-

tlement of the old company's obligations, bondholders received about

$975,000, or roughly sixty-five cents on the dollar; stockholders received

nothing.

Controlled by William S. Barstow, General Gas and Electric owned utilities

in several eastern cities and supplied transport as well as electric power in and

around Rutland, Vermont, and High Point, North Carolina. Barstow formed a

new corporation, the Northwestern Ohio Railway & Power Company, as a

wholely owned subsidiary of General Gas and Electric. Capitalized much like

its predecessor, the NOR&P issued five percent first mortgage sinking fund

bonds for the full purchase price of $1,100,000 plus $500,000 in seven per-

cent preferred stock and $800,000 in common. None of the securities were

sold to the public; all remained the property of General Gas and Electric.

18. Irville A. May, Street Railway Accounting: A Manual of Operating Practice for Electric

Railways (New York, 1917), 287-90; [Theodore Schmitt], General Manager, TPC&LS, to R.

M. Dittey, Chairman, Tax Commission of Ohio, March 27, 1912, letter folded inside front

cover, "TPC&LS Tax Commission Report," 1911, Box 156, OE papers.

19. Before assuming the presidency of First Mortgage Guarantee & Trust Company of

Philadelphia in 1909, Shaw had been a lawyer and banker in Iowa, governor of that state from

1898 to 1902, and Theodore Roosevelt's Secretary of the Treasury from 1902 to 1907. Albert

N. Marquis, ed., Who's Who in America (London, 1910), 1727.

20. "TPC&LS PSC Report," 1911-12, 5, Box 157, OE papers. The company's final state-

ment of current assets and liabilities showed cash and accounts receivable of $14,900 against

current liabilities of $96,500. The railway was all but bankrupt. "TPC&LS Tax Commission

Report," 1912, 23, Ibid.

134                                                    OHIO HISTORY

Later in the year the NOR&P issued an additional $193,000 in bonds to fund

a large power house addition, purchase the small Port Clinton Light and

Power Company ($30,000), and make other minor improvements. While the

stock of the NOR&P was as speculative and dependent on future earnings as

was the stock of the TPC&LS, the reduction in bond interest from $75,000

to $64,650 dropped the fixed charges that had to be met before dividends could

be considered. At least as interested in electric sales as transport, General Gas

and Electric followed its Marblehead peninsula purchases with acquisition of

the Sandusky Gas and Electric Company across Sandusky Bay.²¹

Purchasing the TPC&LS during its best year, Barstow doubtlessly expected

recent earnings improvements to continue into the future, and earnings did

improve in the second half of 1912 when the railway paid bond interest, full

dividends on the seven-percent preferred, and two percent on the common, al-

though it ran a small deficit to pay the last. But dividends soon disappeared.

Beginning in 1914 rising costs and declining revenues quickly reversed the

railway's fortunes, and in 1915 it earned only $73,950 on operations and ran a

$4900 deficit after paying bond interest and taxes.²²

The reasons for the reversal were fourfold. First, the inflation that accom-

panied World War I increased the prices of all commodities including labor

and particularly coal, sharply raising operating costs. Second, as the railway

aged the funds required for annual maintenance of road bed, bridges and trestles

("way and structures") increased more rapidly than inflation, from $8,200 in

1910, to $18,000 in 1915, and $45,500 in 1920. Third, the Marblehead

peninsula gradually lost its position as the focal point of tourism in northern

Ohio, eclipsed after World War I by flourishing Cedar Point on the south side

of Sandusky Bay. The TPC&LS attempted to meet this challenge by leasing

and electrifying a spur of the Marblehead and Lakeside Railroad to Bay Point

in 1911, thereby moving the terminus of the line three miles south from

Marblehead and as close to Cedar Point as peninsular geography would allow,

and by entering into seasonal joint traffic agreements with lake steamers

which connected the railway with Cedar Point, Sandusky and Cleveland.²³

But the overriding reason for the decline in the NOR&P's fortunes was the

increasingly widespread ownership and use of the private automobile. As a

21. Hilton, 12-16, Electric Railway Journal, 39 (June 1, 1912), 945; 40 (July 6, 1912), 38;

(July 27, 1912), 141; (September 28, 1912), 512; (November 16, 1912), 1043; Public Service

Commission Report, 1912, 540-45, 645-46; "NOR&P Tax Commission Report," 1912, 72, Box

99, OE papers; "Sandusky Gas and Electric, Tax Commission Report," 1913, 7, Box 143, OE

papers.

22. "NOR&P Tax Commission Reports," 1912-1914, 15, and "NOR&P ICC Report," 1912-

13, 31, 35, Box 99, OE papers. The NOR&P paid two percent on its preferred in 1913, 0.5

percent in 1914, and nothing on its common.

23. "TPC&LS Tax Commission Report," 1910, 47; "NOR&P Tax Commission Reports,"

1915, 61, 1920, 33, Boxes 99, 157, OE papers; Hilton, 9-10.

Interurbans in the Automobile Age                                         135

tourist road it was particularly vulnerable to automobile competition as fami-

lies with automobiles, particularly in rural areas, used them in preference to

available public transport for recreation and pleasure. County fairs provide a

good example. In 1914 Electric Railway Journal reported that while atten-

dance at agricultural fairs in the upper midwest generally was above that of

the previous year, electric railway patronage and revenues on lines serving fair

grounds were off sharply; an accompanying illustration showed a field of

parked touring cars at the Fremont, Ohio, fairgrounds.²⁴

Similarly, the automobile expanded vacation possibilities by increasing in-

dividual control over travel arrangements. "Vacationing in a motor car is

quite the finest thing that has been discovered," a Detroit newspaper observed

in 1915; "The expense is no greater but the liberty is, for one does not have

to depend on time tables and be in a rush."²⁵ Interurbans dependent on tourist

traffic quickly felt the consequences. A New England street railway president

told the Federal Electric Railway Commission in 1918 that electric lines built

"through strictly summer resort territory" in western Massachusetts had in re-

cent years lost up to two-thirds of their patronage and in some cases been

abandoned. "Some years ago," he explained,

the tourists came in and spent a week or a month in some favorite inn with an oc-

casional trolley trip through the hills. Now the tourist comes in his automobile,

and depending upon his standing, a very elaborate one or a very simple one, stays

a day or two and passes on to some other part of the country. That has had a most

disastrous effect upon the revenue of the electric lines in the territory. .. .26

Cedar Point, with its resorts, amusement park and other attractions, profited

from these changing patterns in tourism. Easily accessible by automobile

from northern Ohio's numerous industrial cities and market towns in a broad

24. Michael L. Berger, The Devil Wagon in God's Country: The Automobile and Social

Change in Rural America, 1893-1929 (Hamden, Conn., 1979), 103-26; "Effect of Automobiles

on Interurban Transportation," Electric Railway Journal, 44 (December 5, 1914), 1243.

Promoters considered county fairgrounds to be important traffic builders. A never-built line

from Akron to Mansfield planned its route to pass five. Electric Railway Journal, 33 (January

16, 1909), 121.

25. "Motor Cars Change Ideas of Vacation, Greater Freedom," Detroit Free Press, July 11,

1915, Pt. 5, 8.

26. Testimony of Lucius S. Storrs, President of the Connecticut Company, before the

Federal Electric Railroad Commission, quoted in Delos F. Wilcox, Analysis of the Electric

Railway Problem, (New York, 1921), 101. A Wisconsin hotel executive estimated that from

May to December "motor tourists" constituted 75 percent of his hotels' transient business.

Walter Schroeder, "Concrete Highways Bring Business to Wisconsin Hotels," Concrete

Highway Magazine, 8 (December 1924), 270-72. For the impact of the automobile on tourism

in the White Mountains, see William L. Taylor, "Getting There," in Richard Ober, ed., At What

Cost? Shaping the Land We Call New Hampshire (Concord, 1992), 25-35; for Glacier National

Park, see Douglas V. Shaw, "The Great Northern Railway and the Promotion of Tourism,"

Journal of Cultural Economics, 13 (June 1989), 65-76.

136                                                        OHIO HISTORY

arc from Cleveland to Toledo, it attracted a growing automobile trade from an

early date. On July 4, 1915, for example, 3,500 patrons arrived by steamer,

3,500 by train, and 3,000 by automobile; on the same holiday six years later

3,000 cars occupied parking spaces, representing far more than 3,000 people.

Long stays in the Point's resort hotels declined in importance, replaced by

many more people arriving for one-day auto visits. As a result, traffic on the

NOR&P seeking to transfer to Lake Erie steamers dwindled, and in 1925 the

line terminated its joint traffic agreements with steamer companies and aban-

doned its extension from Marblehead to Bay Point.²⁷

Summer tourist traffic began to desert the NOR&P in 1912 or shortly

thereafter. Total annual passenger revenue peaked in 1913-14, but total pas-

senger numbers did not peak until the following year, consistent with slight

increases in local use set against modest declines in seasonal long-distance

travel, such as Toledo residents visiting resort areas on the peninsula and adja-

cent islands.²⁸ Surviving monthly traffic figures from 1917 suggest the ex-

tent of the decline in summer tourist patronage. August continued to be the

railway's busiest month in 1917, but in contrast to 1911, when the August

peak was 54 percent above the January-to-March average, the August peak in

1917 was only 17 percent above the winter average. While winter patronage

in 1917 exceeded that of 1911 by 13.9 percent, August 1917 patronage fell

9.2 percent below that of August 1911.29

The rapid decrease in tourist traffic accompanied a severe but more gradual

falling off of patronage generally. Peaking in 1914-15 at 934,000, ridership

began a long secular decline which continued with only occasional interrup-

tion until the end of passenger service in 1939. By 1918 the number of rev-

enue passengers had fallen to 656,000, the lowest in the road's history.

Traffic stabilized near 600,000 through 1921 but then began to fall again,

reaching 492,000 in 1923, a mere 53 percent of the 1914-15 high.³⁰

27. David W. and Diane D. Francis, Cedar Point: The Queen of American Watering Places

(Canton, Ohio, 1988), 56-57, 72-73, 82.

28. "NOR&P ICC Reports," 1914-15 and 1915-16, 403. Evidence from the company's

annual reported revenues from handling baggage confirms these conclusions. Baggage rev-

enue peaked in 1911 at $1,442, fell slightly to $1,372 in 1912, and then began a more dramatic

slide, to $1,210 in 1913, $1,056 in 1914, and $806 in 1916. The drop in baggage revenue would

seem to provide a rough proxy by which we can gauge the decrease in long-term tourist

traffic. "TPC&LS and NOR&P Tax Commission Reports," 1910-1916, 55, Boxes 99 and 157,

OE papers.

29. Monthly figures from work sheet folded inside back cover of "NOR&P ICC Report,"

1917, Box 99, OE papers.

30. "NOR&P ICC Reports," 1914-15, 65, 1915-16--1923, 403, Boxes 99-100, OE papers.

These figures differ from those given by Hilton as he did not take into account that the com-

pany filed two reports in 1916, one on June 30 and one on December 31. Hence Hilton's

figures beginning with 1917 are ahead by one year. See Hilton, 16.

Interurbans in the Automobile Age                                     137

Interurbans all over the country experienced similar declines as automobiles

increased in number and as improved roads expanded their range. Electric

Railway Journal noted the impact of the automobile on traffic as early as

1911. In an unnamed Indiana town of 8,000 connected by interurban to a

nearby city of 20,000, it claimed, there were thirty-five automobiles.

Through 1910 the railway "derived a very gratifying income from the town,"

but now, "owners of machines go to the city in their autos and invite their

neighbors to accompany them, and the company loses not only the business

of the owners but that of many [other] persons besides." Similarly, a Texas

railway official noted in 1917 that in small towns, "where everyone seems to

know everyone else," automobile owners hailed their friends waiting at in-

terurban stops and carried them free to their destinations. The most common

reason for cashing in an unused leg of a round-trip ticket, he maintained, was

"'made the trip in an automobile."' Thus the impact of automobile use on

rail patronage had the potential to extend well beyond the community of own-

ers.³¹

Automobile ownership expanded most rapidly in prosperous rural and

small-town areas of the Midwest. Ottawa County was no exception. County

residents owned 3,382 registered automobiles in 1922, a figure which grew 76

percent to 5,944 in 1926, or one auto for every 3.57 persons. As access to

automobiles increased, as paved roads connected the county's farms and vil-

lages with each other and with places more distant, the relative importance of

public transport diminished.³²

Between 1923 and 1926 traffic on the NOR&P declined another 41 percent,

from 492,000 to 290,000, a direct result of increased automobile use. Unlike

many other Ohio interurbans, the NOR&P remained relatively free of motor

bus competition along its route as that industry developed after 1915. Only

in the Port Clinton area did buses compete directly. A line connecting Port

Clinton with Fremont and Tiffin paralleled the railway for several miles be-

fore turning south, and in 1921 service with a single vehicle began between

Port Clinton and Gypsum, four miles further east along the peninsula.³³

31. "Automobiles Affect Interurban Traffic," Electric Railway Journal 38 (August 26,

1911), 370; James P. Griffin, "The Influence of the Automobile on the Interurban," Ibid., 49

(May 5, 1917), 820.

32. Berger, 77-94; "Anticipated Progress, 1927-1937, The Toledo Edison Company"

(typescript), 1927, 18, Box 134, OE papers; The Ohio Public Service Company, "Market

Analysis of the Securities Sales Territory" (typescript), 1926, Table X, Box 135, OE papers.

33. "NOR&P ICC Report," 1923, 403, Box 99, OE papers; Ohio Public Service Division

Operating Reports, 1927-1930, Box 129, OE papers; "Motor Bus Reports," 1926, 1931,

Records Group 1496, Ohio Historical Society, Columbus, Ohio. A 1922 review of the Ohio

intercity bus industry confirmed the lack of competition with the NOR&P. "Birdseye View of

Ohio Buses," Bus Transportation, 1 (March, 1922), 173-81.

138                                                     OHIO HISTORY

More troubling than the motor bus was the motor truck. Just as interur-

bans had used their greater convenience and flexibility to take some of the

less-than-carload freight, package express and perishable commodity traffic

from steam railroads, motor trucks used their even greater flexibility and

lower costs to undercut electric railways and to edge them out of the various

specialized niches they had found in the movement of freight. As with the

motor bus, serious motor truck competition began around 1915 and grew

rapidly in the 1920s as roads and vehicles improved.³⁴

From its inception the promoters of the TPC&LS had looked to the or-

chards and truck farms of the Marblehead peninsula as a major revenue source,

and as we have seen, heavy freight traffic in the early fall represented the rail-

way's participation in those harvests. But this type of traffic was particularly

susceptible to truck competition as trucks could load in every farm yard and

drive directly to Toledo markets and freight houses, eliminating the haul from

farm to railway loading dock. In the early 1920s the NOR&P encountered se-

rious competition from local truck lines and reduced its rates at the beginning

of the 1922 season in an attempt to maintain its position in transporting the

fruit harvest to market.³⁵

The growth and decline of the NOR&P as a milk hauler more clearly doc-

uments the impact of the motor truck on the carriage of perishable farm

commodities. Few products require more rapid handling than unrefrigerated

raw milk, and interurbans proved superior to both railroads and horse-drawn

wagons in moving milk from farm to market. Farmers with access to in-

terurbans took advantage of improved transport links, and dairy production

generally increased along interurban lines. Like other interurbans, the

NOR&P built platforms along its right-of-way on which dairy farmers left

milk in standard five, eight, and ten-gallon cans. To each can farmers tied a

prepaid ticket and a return address tag; for rates which in 1920 ranged from

12.5 to 28.5 cents per can depending on can size and distance, the railway

picked up the cans, carried them to Toledo and returned the empties.³⁶

Although Ottawa County was not a major milk producer, the NOR&P

built up a small but respectable business. Receipts grew from $700 in 1909

to $1200 in 1914, to $3450 in 1918. Peaking at $6250 in 1920, receipts fell

to $3550 in 1923, the last year for which figures are available. The NOR&P

34. Pease, 35; William R. Childs, Trucking and the Public Interest: The Emergence of

Federal Regulation, 1914-1940 (Knoxville, 1985), 7-43.

35. "Special Rates Being Arranged," Electric Railway Journal 60 (July 1, 1922), 30; John

M. Killets, Toledo and Lucas County, 1623-1923, Vol. I (Chicago and Toledo, 1923), 557.

36. Northwestern Ohio Railway and Power Company, Local Milk Tariff, October 30, 1920,

in "Rates and Tariffs for Railway Service, The Ohio Public Service Company," Box 134, OE

papers. See also Pease, 9-11; Bogart, 598-99; G. W. Parker, "Transportation of Milk and

Cream," Electric Railway Journal 36 (December 24, 1910), 1237-38; and "Transportation of

Freight," Ibid., 42 (October 4, 1913), 601-02.

140                                                    OHIO HISTORY

bond interest and taxes) peaked in 1912 at $114,700 and then began to fall.

As net income fell, the railway's operating ratio, the percentage of revenues

required to fund operations, rose, from 58.2 percent in 1912, to 69.6 percent

in 1915, and 86.1 percent in 1917. By 1915 net income after operating ex-

penses no longer covered fixed costs, and the company lost $4,900. Losses

increased 50 percent to $7450 in 1916 and then escalated to a disastrous

$43,550 in 1917 when railway operating costs rose 24.1 percent while rev-

enues rose only 6.8 percent. Power costs jumped 45 percent above those of

1916, primarily the result of sharply higher coal prices, and labor rose 22 per-

cent. While other items increased more modestly, these two alone represented

increased annual costs of more than $23,000. As earnings declined the com-

pany ceased to be able to cover its full bond interest payments, and between

1918 and 1923 fell $101,000 behind.³⁸

Like other Ohio interurbans, the NOR&P responded to increased costs by

attempting to raise fares. It eliminated discounts and applied to the PUCO to

boost maximum fares from two cents to three cents a mile. Granted the in-

crease in July 1918, the NOR&P immediately raised its fares to the new max-

imum.³⁹ Higher fares, however, did not have the desired impact on the rail-

way's balance sheet. Ridership in 1919, the first full year in which the new

fares were in effect, was 24 percent below 1917 levels; consequently 1919

passenger revenue rose only 13 percent above that of 1917. At the same

time, the railway made only nominal cuts in service, running its cars with in-

creasing numbers of empty seats. To attract traffic the railway began in 1922

to discount the fares it had worked so hard to secure in 1918, offering books

of tickets discounted 20 percent and low-priced weekend excursions. In spite

of the company's best efforts, however, patronage continued to decline and

railway net revenue fell steadily, from $61,000 in 1918 to $18,400 in 1923

(see Table II). Net income from railway operations in 1922 and 1923 was not

sufficient to pay the annual taxes on the property.⁴⁰

While demand for NOR&P rail services dwindled, demand for power and

light grew from year to year. From its beginning the TPC&LS carried on a

successful sideline in the sale of electricity, and under NOR&P ownership

that business expanded steadily, with the most rapid growth coming after

38. "NOR&P Tax Commission Reports," 1915-1920, 55, 61-63, 71, 73, 79; 1921-1923, 27,

33-35, 43, 45, 51. In addition, the NOR&P made no required contributions to a bond sinking

fund and did not begin a depreciation reserve until 1920. "NOR&P ICC Reports," 1918-1923,

206, 232; C. C. Cash to the ICC, November 4, 1922, letter, inside 1922 Report, Boxes 99-100,

OE papers.

39. PUCO Report, 1918, 141-43; "Three Cents a Mile for Interurbans" Electric Railway

Journal, 51 (June 8, 1918), 1099-1100; "Ohio Interurbans Act," Ibid. (June 29, 1918), 1254;

"Increase for Ohio Interurbans," Ibid., 52 (July 20, 1918), 133.

40. "New Schedules and Fares Announced," Electric Railway Journal 59 (June 3, 1922),

915. "NOR&P ICC Reports," 1918-1923, 301, 403, Boxes 99-100, OE papers.

Interurbans in the Automobile Age                                      141

World War I. Total sales rose from $57,400 in 1913, to $82,600 in 1918, to

$302,500 in 1923, and the number of customers grew from an estimated 300

in 1912 to around 3,000 in 1924. By the mid-1920s power and light was

more than a sideline.⁴1

Selling electricity improved railway earnings in several ways. Electric

railways were rather inefficient users of power plant capacity as their opera-

tion necessarily involved high peak demand relative to average demand.

Hence railway power houses required large reserve capacities to meet peak de-

mand. By selling electricity to additional users with varying peak hours, the

ratio of peak demand to average demand tended to fall, raising what the indus-

try calls the "load factor;" higher load factors increased production efficiency

and lowered unit costs. Before 1910, in spite of low load factors, railways

commonly generated their own power because only in the largest cities did in-

dependent generating capacity exist which might supply their needs. After

1910, as societal demands for power and light grew, railways tended to be-

come either net sellers of electricity to others, satisfying that demand, or net

purchasers, phasing out their own power houses and integrating their idiosyn-

cratic loads into the more diversified loads of larger producers serving many

consumers. Either way railways benefitted through lower unit costs for the

power they consumed, but railways which sold electricity gained the addi-

tional benefit of the revenue and profit which that commodity earned.⁴²

In the long run the future lay with power sales. By the end of the 1920s

railway transport was a distressed industry almost everywhere, while electric

light and power demand continued to expand steadily. Akron-based Northern

Ohio Traction and Light, for example, passed a milestone in 1919 when more

than 50 percent of net revenue came from power sales, and it reached a major

turning point in 1926 when the electric division for the first time earned the

majority of gross revenue. In that year the company changed its name to

Northern Ohio Power and Light, eliminating the association with transport,

and four years later shed its increasingly marginal urban and interurban trans-

port divisions and renamed itself Ohio Edison.⁴³

41. "NOR&P Tax Commission Report, 1913, 55, 1918, 69, 1923, 21 (elec.); "Anticipated

Progress, 1930-1937, The Ohio Public Service Company," June 1930 (typescript), Box 134, and

Ohio Public Service, "Market Analysis of the Securities Sales Territory," December 1926

(typescript), Box 135, OE papers.

42. Harold L. Platt, Electric City: Energy and the Growth of the Chicago Area, 1880-1930

(Chicago, 1991), 95-138; Samuel Insull, "The Relation of Central Station Generation to

Railway Electrification," Electric Railway Journal, 40 (July 6, 1912), 12-19; C. N. Duffy, "The

Effect of Load Factor on Cost of Electric Railway Passenger Service," Ibid., 41 (February 1,

1913), 195-96; "Selling Energy Along Interurban Railways," Ibid., 48 (October 28, 1916), 920-

25; "Helping Out the Passenger Earnings," Ibid., 50 (September 1, 1917), 349-50; Charles H.

Jones, "Power Facilities," Ibid., 64 (September 27, 1924), 493-97.

43. James M. Blower and Robert S. Korach, The N.O.T. & L Story (Chicago, 1966), 8-9;

142                                                   OHIO HISTORY

The NOR&P followed a roughly similar course on a much smaller scale.

Hurt by high coal prices in 1917 and 1918, electric earnings emerged there-

after as the heart of the company (see Table II). Each year the NOR&P ex-

panded its area of service; indeed, the company listed in its reports the receipt

of between four and seven thousand dollars in income annually as "donations"

from private parties seeking line extensions. In 1920 net operating income

from electricity exceeded that of the railway, and in 1923, the company's best

year since 1912, 52 percent of gross revenues, 85 percent of pre-tax net rev-

enues, and 100 percent of after-tax net, came from electric sales. The

NOR&P had returned to profitability, but as an electric utility tethered to a

money-losing railway subsidized by electric earnings.

In 1924 the company set out to break that tether and end the subsidy.

Drawing up plans to separate the railway and electric divisions into separate

co-owned corporations, company directors planned to retire the 1912 railway

bonds and to issue new mortgage bonds secured only by the electric proper-

ties. As an independent entity the railway would purchase power from the

electric company. But the railway could hardly stand alone. Unable to earn

even its taxes, it would quickly fail, and like other failed interurbans in the

1920s, just as quickly be abandoned. It seems clear from the record that the

NOR&P sought to detach the railway from the power business in order to

scuttle it. Although approved by the PUCO, the reorganization was not im-

plemented.⁴⁴ Instead, Barstow's General Gas and Electric received and ac-

cepted an unsolicited offer to purchase both the NOR&P and Sandusky Gas

and Electric.

Years of Decline, 1924-1939

The purchaser, Ohio Public Service, deserves detailed attention. Utility

magnate Henry L. Doherty followed his 1913 acquisition of The Toledo

Railway & Light Company (which split in 1920 into Community Traction

and Toledo Edison) with the purchase of several small utilities forming an ir-

regular crescent thirty to eighty miles from Cleveland, and encompassing

Warren, Alliance, Massillon, Mansfield (where the company also supplied

traction), Ashland, Elyria, and Lorain. As electric demand grew, each local

generating plant began to push the limits of its production capacity. In 1921

Doherty merged all of these companies into Ohio Public Service, wholely

Northern Ohio Power and Light, Annual and Monthly Operating Reports, 1919-1930, Boxes

22-25, OE papers.

44. "Application to P.U.C.O., March 13, 1924," carbon copy folded inside back cover of

NOR&P Director's Minute Book, January 10, 1921 to April 17, 1925, n.p., Box 98, OE papers;

PUCO Report, 1924, 108.

Interurbans in the Automobile Age                                     143

owned by his Cities Service holding company, with the intent of connecting

the cities with high-tension lines and supplying them with power produced in

plants located on Lake Erie where abundant cooling water and ease of coal de-

livery assured low generation costs. Additionally, as peak demand occurred at

different times in each locality, the reserve capacity required by an inter-con-

nected system would necessarily be less than the sum of the reserves required

for each of the localities standing alone; the more diversified load of several

cities would provide a higher load factor for an integrated system than any

single city could achieve individually. Hence inter-connection reduced the

need for reserve capacity, allowed maximum production at low cost plants,

and increased overall system efficiency.⁴⁵

Quickly integrating its system and concentrating power production in large

lake-shore plants near Lorain, OPS in 1923 began to explore expansion

prospects. A Cleveland consultant hired to analyze the Ohio utility industry

identified Barstow's Sandusky Gas and Electric as a particularly strategic ac-

quisition. An industrial city set in a prosperous agricultural region, Sandusky

would furnish a large and diverse load, and the property would forge a link be-

tween OPS territory in Lorain and Elyria to the east and co-owned Toledo

Edison to the west; Toledo Edison, the consultant recommended, should ac-

quire the NOR&P for its Ottawa County electric territory. In September

1924 OPS bought both companies, solidifying Doherty's position along the

lake shore west of Cleveland.⁴⁶

Ohio Public Service paid General Gas and Electric $2,755,000 for the

NOR&P, an enormous price. Earlier in 1924, when the NOR&P sought

PUCO approval for its restructuring, the commission placed a value of

$1,013,000 on its electric properties. In structuring its purchase, OPS paid

$1,105,000 for the electric assets and $1,650,000 for the railway, an amount

just about equal to what the NOR&P claimed as its original cost plus im-

provements. Yet no astute investor would offer that amount for the railway

alone; by 1924 it was more liability than asset, as General Gas and Electric

implicitly recognized in its plan to reorganize and recapitalize the NOR&P.

45. "[Toledo Edison]," (untitled bound report containing history and analysis of company

operations), 1940? Box 135, OE papers; Henry L. Doherty & Company, "A Suggested Plan for

the Development of the Ohio Electric Properties," November 1, 1919 (typescript), Box 134,

OE papers; William A. Duff, History of North Central Ohio, Vol. I (Topeka, 1931), 247-50;

Thomas P. Hughes, Networks of Power: Electrification in Western Society, 1880-1930

(Baltimore, 1983), 291-93; David E. Nye, Electrifying America: Social Meanings of a New

Technology, 1880-1940 (Cambridge, 1990), 182.

46. H. A. Fountain, "The Ohio Public Service Company, Electric Territory, Preliminary

Survey," May 31, 1923 (typescript), 17-18, Box 134, OE papers. Fountain believed Barstow's

properties were developed below their potential and that the Sandusky purchase had the

additional benefit of preventing rival Ohio Power, operating in Tiffin and Fremont, from

reaching the lake.

144                                                         OHIO HISTORY

By purchasing the railway at close to its book value, OPS in effect paid a

premium for the Ottawa County and Sandusky electric territories. OPS

wanted access to new markets, and if in the process it had to acquire an unpro-

ductive railway at a price unrelated to its investment value, it was prepared to

do so.⁴⁷

Company actions soon after support this conclusion. Within a year of ac-

quiring the NOR&P and Sandusky Gas and Electric, OPS tied the Marblehead

peninsula to Sandusky by means of high-tension lines under the bay and

closed the Port Clinton power house. It then connected Sandusky to its

Lorain generating stations to the east and to Toledo Edison to the west, inte-

grating its new properties into a growing regional power grid, and closed the

Sandusky power house.⁴⁸ Although OPS considered its primary business to

be "the production, transmission, distribution and sale of electric energy" and

its transport facilities to be "incidental to the acquisition of its electric proper-

ties," it made a good faith effort to operate its railways in the public interest

in spite of continuing losses; it did not capitalize them apart from the electric

properties and issued no securities against them. In 1925 its Mansfield and

Port Clinton properties together lost $28,500 on operations and $70,750 after

taxes, losses easily covered by a net income of $3,312,000 from the sale of

electricity, electrical appliances, and natural gas.⁴⁹

On the Marblehead peninsula passenger trends continued much as they had

since World War I. As travel moved to the automobile, patronage on OPS

fell 55 percent between 1923 and 1929, from 492,000 to 218,500. In spite of

this decline, however, the company maintained service levels, reducing sched-

uled passenger mileage only by 14 percent. To encourage ridership, OPS re-

duced round-trip and children's fares in 1927, and in 1929 began bus service

with two leased 21-passenger buses, connecting Port Clinton and Marblehead

with Sandusky across the recently completed Bay bridge. But this service

47. "Northwestern Ohio Property Passes to Doherty," Electric Railway Journal, 64 (August

2, 1924), 183; PUCO Report, 1924, 108; "OPS Tax Commission Report," 18, Box 109, OE

papers. Because the price OPS paid for the railway did not exceed the value of its physical

assets, the PUCO accepted the figure, even though it bore no relation to the present or probable

future earnings potential of the property.

48. "The Cities Service Power and Light Company, Ohio System, Summary--O.P.S. and

A.P.S. Section, Plant Capacity," October 9, 1940 (typescript), n.p., Box 135, OE papers.

Before purchasing the Barstow properties OPS verified that it could import power from Lorain

more cheaply than producing it in Sandusky and Port Clinton. Henry L. Doherty & Co.,

"Report on Sandusky Gas & Electric," July 3, 1924 (typescript), Box 145, OE papers.

49. "History and Business," n.d. (prob. 1937; appears to a fragment of a draft of an SEC

submission), Box 134, OE papers; "OPS ICC Report," 1925, 301, 303, Box 110, OE papers. Six

percent of the company's $3,312,000 net income in 1925 came from the sale of electric

appliances, ten percent from natural gas, and 84 percent from electricity. Pre-tax transport

losses reduced net income by less than one percent.

Interurbans in the Automobile Age                                      145

drew far fewer patrons than the minimum necessary to cover costs, and the

company gave it up after a six-month trial and operating losses of $10,900.50

The decline in passenger traffic was offset to some extent by steadily in-

creasing freight traffic. Although interurbans tended to lose freight traffic dur-

ing the 1920s, the unusual role of OPS in hauling mine products from the

Marblehead peninsula to Toledo railroad connections gave it a traffic for

which motor trucks could not readily compete. In 1926 freight revenue

reached $111,600, exceeding passenger revenue (which decreased to $92,800)

for the first time. While freight produced the majority of revenues, passenger

service accounted for most operating costs. The railway ran 440,000 passen-

ger miles in 1929 and 105,000 freight miles. Each freight mile produced

$1.05; each passenger mile only 17.7 cents. As operating costs averaged

34.0 cents per revenue mile, the conclusion seems inescapable that freight

earnings subsidized passenger service.⁵¹

In the late 1920s the seasonality that had characterized passenger and freight

traffic since the railway's inception all but disappeared. In 1926 the number

of revenue passengers carried in August equalled only 84 percent of the winter

average, and after 1926 the railway no longer added extra cars to its summer

base schedule to handle anticipated heavier traffic loads. Yet the link to

tourism was not completely lost. In spite of the low August passenger count

in 1926, revenue collected from passenger fares was the highest of any month

that year. The average August rider paid 39.7 cents, 34 percent above the

January average of 29.5 cents. The longer average rides of summer tourists

continued to affect revenue patterns, even if those tourists were now compara-

tively few in number. August revenue peaks persisted through 1938, the last

summer of passenger service, although in each year the railway attracted its

greatest number of patrons per month in the winter when it functioned as a

cold-weather substitute for the private automobile.⁵²

The traditional September harvest-season freight peak also faded. While

September freight revenues in 1926 were 28.4 percent above the average for

the year, that figure dropped to 22.0 percent in 1927; in 1928 September

50. "NOR&P ICC Report," 1923, 403, Box 100, OE papers; OPS Division Operating

Reports, 1927-1930, Box 129, OE papers; "Motor Bus Reports," 1929, 1930, Records Group

1496, Ohio Historical Society; Hilton, 23; "Rates and Tariffs for Railway Service, The Ohio

Public Service Company," Box 134, OE papers. The railway did not reduce its "corpse rate"

in 1927, keeping it at $3.00 between any two stations, with no discounts to encourage regular

riding. The corpse had to be in a casket and the casket in a "rough box," accompanied by "a

person in charge" who carried applicable permits and paid the regular fare.

51. OPS Division Operating Reports, 1927-1930, Box 129, OE papers. These monthly re-

ports give operating statistics for each division, electric, gas and transport. As each report

included year-earlier figures, the 1927 reports include 1926 comparative information. These

are the first monthly figures available after those of 1917. OPS ended freight and package

express service on its Mansfield-to-Shelby interurban in 1925. PUCO Report, 1925, 232.

52. OPS Division Operating Reports, 1927-1938, Boxes 129-30, OE papers.

146                                                  OHIO HISTORY

freight revenues were somewhat below the year's average, indicating the loss

of virtually the entire fruit and produce crop to the motor truck. Increasingly

dependent for revenue on the bulk shipment of minerals from the Marblehead

peninsula, the railway more and more resembled a short-line steam railroad.

Perhaps for this reason OPS explored converting the railway to steam in

1926, but lost interest when it discovered that its village franchises forbade

steam operation on local streets.⁵³

The steady ridership declines of the late 1920s eventually led to sharp cut-

backs in service. In January 1930 OPS reduced its base schedule to require

five cars rather than six, and a year later cut back again from five to three.

Annual mileage dropped 36 percent, from 426,000 in 1929 to 271,000 in

1932, the first full year of reduced service. Infrequent schedules and economic

hard times accelerated the decline in ridership; patronage dropped 69 percent

between 1929 and 1932, from 218,500 to 67,700. The depression affected

freight service similarly, with revenues falling 61.5 percent between 1929 and

1932; indeed, 1932 combined passenger and freight revenues were the lowest

in the railway's twenty-five year history. Only by slashing service and main-

tenance expenditures did OPS avoid losses on operations.⁵⁴

The rest of the 1930s were equally bleak. Passenger counts fell to 57,000

in 1933, rose slowly to 77,500 in 1936, and then began to fall again, reach-

ing a new low of 49,000 in 1938. In hopes of generating ridership, OPS of-

fered heavily discounted fares which rewarded regular patrons. A book of

twenty-five tickets for the four-mile trip between Port Clinton and Gypsum

sold in 1934 for $1.50, a cost of six cents per ride or 1.5 cents per mile; a

year later a book of forty tickets for the eleven miles from Oak Harbor to Port

Clinton sold for seven dollars, roughly the same cost per mile. In 1937 the

company offered a $1.50 weekend round-trip fare between Toledo and

Marblehead, and a $1.00 Sunday-only fare, a price justifiable only on the

grounds that hauling low-fare passengers added more value than hauling

empty seats. But even at these prices the railway could not compete success-

fully with the private automobile.⁵⁵

Bus competition also affected revenues in the 1930s. By mid-decade

Greyhound connected Toledo with Oak Harbor on a long local route that ter-

minated in Delaware, Ohio, and in February 1938 Gottleib Schuster put three

hundred dollars down on a second-hand eleven-passenger bus and began busi-

ness as Port Clinton Coach Lines. Connecting Port Clinton with Bowling

53. Ibid., 1927-1930; unsigned memorandum to T[heodore] O. Kennedy, February 22,

1926, "Toledo Port Clinton and Lakeside" folder, Box 132, OE papers.

54. OPS Division Operating Reports, 1929-1932, Box 129, OE papers; Delta [an employee

oriented company periodical], VIII (January 23, 1931), 3, Box 138, OE papers.

55. "Rates and Tariffs for Railway Service, The Ohio Public Service Company," Box 134,

OE papers.

Interurbans in the Automobile Age                               147

Green, Schuster paralleled the railway for twenty miles from Port Clinton to

Elmore. Shortly thereafter Schuster revived the route attempted by OPS ten

years earlier, linking Port Clinton, Marblehead and Sandusky with one six-

teen-passenger bus, but gave that up the following year in favor of a route

from Marblehead to Toledo. In 1939 Schuster cleared $1,900 after expenses;

with his minimal capital investment and the relatively low operating costs of

small buses, he could eke out a respectable living from a level of traffic far

below the minimum required to sustain an interurban railway.⁵⁶

By 1938 OPS had reduced its service to six runs each way, at roughly two-

hour intervals between six in the morning and six at night. In early 1939

Community Traction announced it would convert its Starr Avenue streetcar

line to motor bus, eliminating OPS's rail entry into Toledo. Choosing to

abandon passenger service rather than terminate at the city line with a transfer

to city buses, OPS made its last passenger run on July 11th.⁵⁷

A review of the final twelve months of passenger operation illustrates the

futility of continuing service. From July 1, 1938, through June 30, 1939,

the railway operated 188,000 miles of passenger service and carried 46,600

passengers, slightly less than five percent of the 1914-15 peak. Collecting

$12,675 in fares, the railway produced a meager 6.7 cents of revenue per mile

operated. Cars traveled almost empty. With an average fare of twenty-seven

cents, the average ride did not exceed fifteen miles. Spreading 46,600 passen-

gers riding fifteen miles apiece over 188,000 miles of scheduled service pro-

duced an average passenger load of 3.71 patrons riding in cars designed to seat

fifty-six. Not surprisingly, in spite of freight revenues of $61,000, the rail-

way lost $11,900 on operations with an operating ratio of 116 percent, mean-

ing the company spent $1.16 to produce each dollar of revenue.

A comparison with the twelve months following the cessation of passenger

service illustrates the heavy losses the passenger business must have incurred

for many years. While freight revenues increased to $106,000, blurring an

exact comparison, expenses still fell from $86,000 to $65,700 and the road

achieved an operating ratio of 61.5 percent, its most favorable showing since

1912. In spite of increased freight activity, power and labor costs each fell

about 50 percent, a combined $17,500. Without the high costs and low rev-

enues of passenger carriage, the railway could, in a prosperous year, cover the

expenses of its freight service.⁵⁸

Given the extremely low levels of patronage during the 1930s, it is reason-

able to ask why the company continued passenger service until it literally lost

56. "Motor Bus Reports," 1938, 1939, Record Group 1496, Ohio Historical Society; "News

of the Road," Bus Transportation, 23 (November, 1944), 69.

57. Hilton, 25, 28.

58. OPS Division Operating Reports, 1938-1940, Box 130, OE papers.

148                                                   OHIO HISTORY

its way in Toledo in 1939. An internal study in 1935 found transport to be

"of minor importance" to the company, with service continued "only for rea-

sons of public policy and convenience of the public as there is no possibility

of profiting from these operations." In all likelihood the company considered

the provision of transport at a loss as a means of maintaining good public re-

lations in an electric territory and a way to mitigate the growing criticism in

the 1930s of utilities and utility holding companies. There is no indication

that OPS ever envisioned a resurgence in the fortunes of interurban rail trans-

port.⁵⁹

As OPS anticipated when it purchased the NOR&P in 1924, electricity

proved to be a far more lucrative product than transport, with sales rising

from $302,500 in 1923 to $374,000 in 1925. OPS then reduced its Port

Clinton service district by about a third, selling the portion closest to Toledo

to co-owned Toledo Edison. To manage growing demand, OPS followed

connection to Lorain generating plants with a complete rebuilding of its

Marblehead peninsula distribution system. The company was not disap-

pointed: revenue in the reduced territory grew from $251,000 in 1926 to

$277,000 in 1929, and in early 1930 the company forecast a rosy future for

itself in Ottawa County, projecting revenue growth to $343,000 in 1933 and

$697,000 in 1937. The depression, of course, intervened; revenue peaked in

October 1929 and then started to fall, first slowly and then more rapidly.

Annual sales declined every year through 1933 when revenues bottomed at

$213,000, but then began to rise, reaching a new high of $298,000 in 1936

and $321,000 in 1937, less than half of what the company had projected for

itself in 1930.60

While severe, the impact of the depression on the Port Clinton district elec-

tric business did not create a major crisis. The sales category which declined

most sharply, power to industrial users, was also the category with the lowest

sales price per kilowatt. Other categories, such as domestic, commercial and

municipal uses, declined only modestly. Hence while kilowatt sales fell 37.2

percent between 1929 and 1933, revenue declined only 23.3 percent. The

company's most profitable sales categories were least affected by depression

declines. Indeed, the company partially offset sales declines elsewhere by ex-

tending rural-domestic service, its most expensive per-kilowatt category. The

150 customers outside of urban areas in 1928 grew to 306 in 1933, 746 in

1936, and 1,289 in 1939. Accounting for only six percent of all users in

1928, rural-domestic customers constituted 32 percent in 1939; in addition,

59. "Benefits to Communities Served by Ohio Public Service Company Resulting form

Holding Company Management," February 20, 1935 (typescript), 3, Box 135, OE papers.

60. PUCO Report, 1925, 225; "Anticipated Progress, 1930-1937, The Ohio Public Service

Company," June 1, 1930 (typescript), Box 134, OE papers; OPS Division Operating Reports,

1927-1937, Boxes 129-30, OE papers.

Interurbans in the Automobile Age                                     149

average annual kilowatt sales per rural customer grew from 514 to 1,277.

Similarly, while the number of urban-domestic customers increased a modest

15 percent between 1928 and 1939, average annual consumption per house-

hold rose from 456 kilowatts in 1928 to 778 in 1939. Domestic consumers

may have on occasion deferred purchasing new electric appliances, but they do

not seem to have restricted their use of electricity in major ways, and Ohio

Public Service earned income sufficient to pay dividends on its common stock

during each year of the Great Depression.⁶¹

Conclusion

By late 1939 the transition of the original TPC&LS was virtually com-

plete. What had begun as a promising passenger-oriented transport entity

serving an economy centered around agriculture and tourism survived as an

electric sales district of a regional electric utility with an appended transport

anomaly, an electric rail line interchanging car-load freight with steam rail-

roads. OPS continued freight operations over all but the easternmost four

miles of track until the end of 1945, although in most years expenses ex-

ceeded revenues. Disposing of the railway in late 1945 to comply with

Securities and Exchange Commission utility holding company regulations,

OPS sold the eleven miles nearest Toledo, along with much of its rolling

stock, for $32,710 and abandoned the rest of the line. After selling what it

could for scrap, OPS took a $962,000 capital loss, which the company esti-

mated would produce a $230,000 federal income tax credit. New owners

maintained car-load freight service between Ryan and Clay Center under the

name Toledo and Eastern Railroad until changes in shipping patterns brought

about final abandonment in January 1958.62

In retrospect, the Toledo, Port Clinton & Lakeside failed to develop a level

of traffic sufficient to justify its construction. In its thirty-five years as a

passenger road its income never equalled its full costs if depreciation and

amortization of debt are included. One of the longest lasting Ohio interur-

bans, the TPC&LS was also one of the first to fail. Its presumably forced

61. OPS Division Operating Reports, 1928-1939, Boxes 129-30, OE papers; Moody's

Manual of Investments: Public Utility Securities, 1923, 1255; 1939, 1569. See also Nye, 348-

51.

62. Hilton, 25-35; "OPS PUCO Report," 1945, 227, Box 108, OE papers; "Rail

Abandonment," Bus Transportation 20 (January 1941), 55; "Cities Service Bus Lines Affected

by SEC Order," Ibid., 22 (September, 1943), 93. The Toledo and Eastern was purchased by

Alliance businessman L. P. Kulka; on the board of directors were Curtis M. Shelter and W. E.

Hamaker who purchased the Alliance-based Stark Transit Company from OPS in 1944. The

T&E paid its expenses plus a two percent dividend ($1000) on its $50,000 capitalization in

1946, 1947 and 1948, the first dividends paid since 1914. "Toledo and Eastern PUCO

Reports," 1946-1948, 101, 302, Box 156, OE papers.

150                                                   OHIO HISTORY

sale in 1912 came while the industry still found at least modest favor with

investors and Barstow willingly paid three-fourths of the original cost. But

1912 was the best year in the road's history, and it is unlikely that the prop-

erty would have brought half as much several years later when interurbans had

ceased to offer investors the allure of potential future revenues and profits.⁶³

For Barstow the railway was indeed a disaster. The steady growth in electric

sales was the only bright spot on the NOR&P's balance sheet, but not until

the early 1920s did demand for power and light provide sufficient net revenue

to offset the railway's annual losses.

The sale to Ohio Public Service for $1,650,000 twelve years later was

something of a fluke. By 1924 money-losing interurbans did not sell for

anywhere close to their book value; they either brought a small fraction of

their original cost or were abandoned outright. The Cleveland and Eastern

provides an example. Failing to make its operating expenses after 1921, the

company simply abandoned its lines from Cleveland to Chardon and

Middlefield in 1925; the petition to the PUCO cited three reasons why man-

agement believed revenue would never again equal expenses: "Widespread use

of the privately owned passenger automobile," "Growth of bus lines," and

"Increasing use of motor trucks for hauling milk, farm produce and freight."⁶⁴

But the C&E lacked an electric territory, and it was the NOR&P's electric

business that OPS desired when it bought the railway. Bailing Barstow out

of a railway investment gone awry was the premium OPS paid to gain con-

trol of the promising Sandusky and Ottawa County electric markets. In the

twenty-one years OPS owned the road it never anticipated nor earned a return

on this investment.

Yet the railway was not without accomplishment. In his brief 1917 histor-

ical sketch of Ottawa County Scott Stahl noted that the TPC&LS brought a

new level of speed and convenience to local travel, and that improved trans-

port helped to quiet agitation to move the county seat from Port Clinton to

more centrally located Oak Harbor. But in his next paragraph he proudly re-

counted recent improvements in the county's road system, roads which were

the railway's ultimate undoing.⁶⁵ Secondly, the railway introduced electric

current to large areas of Ottawa County. The role of interurbans in extending

electric technology to Ohio small towns and farms remains unexplored; cer-

tainly the TPC&LS accelerated the diffusion of this technology in its service

area. Indeed, in the long run it was the powerhouse the railway built and the

wire it strung to power its cars, rather than the cars themselves and the rails

63. Hilton and Due, 25-41, 209-12.

64. Ibid., 272; Electric Railway Journal 63 (March 1, 1924), 348.

65. Scott Stahl, "Ottawa County," in Nevin O. Winter, ed., A History of Northwestern Ohio,

Vol. I (Chicago, 1917), 528.

Interurbans in the Automobile Age                             151

on which they rode, which had the more lasting impact on Ottawa County.⁶⁶

Paradoxically, the only application of electric technology to gain wide accep-

tance and then fail was also the first, the application to local and regional

transport.

Motorized transportation on paved highways proved to be more flexible and

more convenient. The motor car, motor bus and motor truck in their various

applications successfully competed with and eventually replaced interurban

railways as the transport modes of choice. The Toledo, Port Clinton &

Lakeside, by enduring in spite of losses until the eve of World War II, a

decade after most interurbans disappeared, illustrates the manner in which mo-

torized technology superseded electric rail, first in such areas as tourism and

hauling milk and produce, and then more generally in all other areas of pas-

senger and freight transport, the carload movement of area minerals excepted.

Much to the probable surprise of the railway's original promoters, carload

mineral shipments and sales of electric current proved to be the only lines of

business in which the railway achieved long-term success.

66. Nye, 10-11,292.