Richmond daily Whig. [volume] (Richmond, Va.) 1842-1861, 1854-04-01
NUMBER II.
RIcuxosD, March IS, 1854.
James Lyons Esq.

RICHMOND, March IS, 1854
James Lyons Esq.
Dear Sir:
address you large stoskholder on the virxipi.
Central Railroad Company in rindicaoo of the .,eI.
recently published in the whg over the signature of Heo
eo Inc OBJECT OF those articles not 20 niure the
'a'ore prospects OF the road by creating feeling OF hos
y against the Company, and thus of all necessary
aance either by private corporation subscrpt,oos
ou' 70 nip in the bud what considered runous nol
eJ on the part OF the Company in declaring dividends
win the one band and begging loans with the other AZ
" 'e Puo'sned report OF the Company goes, there Il
no to show that the directory have ever deemed
necessary or Provdent create sinking fund IN reo
resent the depreciation Of ether rolling or perm.
but have always regarded the repairs as be-
ing equivalent to replacement Of the stock of thu
company. 1t Is upon this point "Hcnricon takes issue
win. the directory What has been the policy Of Englsh
Railway Companies Let refer to them as au,bor,v
what conclusions have been arrived tho most
eminent Railway Managers in the Kingdom.-"To illus
ate the principle of depreciation las distinguished from
tue vague and as it seems to US lacous views on the
suec let us regard the case of railway Company that
mas provided itself on the opening with 100 Engines At
IoOo eaeh and that at the end Of years the traffic WAS
found to require and larger Engines in order to keen
up the receipts OF the railway the amount To which
they had attained during tho last year. but which recep
under the circumstances Of the times such as lower char
ges, and consequently increased quantity Of traffic 10
make up the same amount of receipts increased compe
uon as 10 speed erfeH'on Of he road could only be
maintained by the aid of these new cnginesapd this I,
the actual condition OF railways at some period of
their existence Tho 100 original engines II they had
been literally keptup would be WORTH at ma rket
value more than fle5 although they had cast el5o
ooo The 100 new Engines required e25OO each would
cast sa6Ooo Is capital revenue to be charged for
Va
10 new Engines only suffice keep up the Stock to its
original value el5ooOo, at which it stands CHARGED in
capital account
But you shareholders clamorous tor dividend. saw
you have now ITO engines in lieu Of 100 you had
year and these additional engineer have coat eosoo
each therefore these 10 engines should be paid for
out OF capital or at rate the $1,000 each by which
they exceed the old ones in should go to capital
This brings the question between issue We say
you charge any portion of these engines capital
you paying part Of your dividend out of capital and
are on the road to ruin You doing fact precisely
what land does when he pays or repairs TO farm
houses. not by deducpg il from his rents before he
spends his income but by raising the money on mortgage
OF his esate-a course which must at last make him
bankrupt Now is this precisely the position al pres
ent OF the Va. Centl r. r. Co. They have declared
dividend Of 10 per and the time sadded the
road with mortgage of 100000 pay for the replace
uent of out track this track being essentaIIv
necessary TO accommodate an increased traffic. RAILWAY
propretos either consider themselves as
OF their railways occupers Of permanent owners
Then you must keep up the property in such state as
that 1t shall be able to much when you leave Il as
when you entered it. We appeal to any mercantile man
if our prncple-that Of keeping up all the perisbable
stock of railway its market value not the only cor
rect one-he only possible way of adjusting the account
fairly between the present and future shareholders Of
way The practical application of this principle youd
be to lay aside such annual Of ersnue as shall
be sufficient to for all repacements-so that the ac
ua stock at the market value together with the ba lance
in band, If any, OF this fund, should any moment be
equal to the at which the stock the capta
account" Mr.. Fontane states some $4,000 has been
unnpPropraed out of the receipts Of the company and
may be considered as belonging this fund.- The question
does 1t stand to the credit of such fund the books
OF the Company. If this surplus is in hand then why
add the dividend declared last Octoher and n. of
the debts DUE instead of adding the debt borrowing
$780, 900 to relay the track In lS4s the London and
Northwestern Railway Company transferred $50 46o from
rspne TO account working stock in other words
the extinction OF so much Of the moving capital with
view OF maintaining due relation of first to present
cost "A second hand article, be il engine carriage
wagon, be made equal new unles In process
OF time 1t may be so thoroughly changed all parts
longer in fact TO retain anything but the of its for
mer self And as this entire renovation supposed to be
ELECTED in departments and not run the
entire range of the stock the SYSTEM should rather
say, the expedency ofaneeting, by depreciation allow
anc the inability TO overake the decayng process forced
itself upon the attention Of railway officials" This is the
report of the Superintendent of the same Company
When depreciation is not allowed for, it should be
balanced by addition Of Stock Of revenue as
shall represent the difference in value ia any given time
Has the Central Railroad Company ever done eithers
The Utica and Syracuse Company found il necessary to
meet the large and constant depreciation Of rolling
and permanent way to transfer s35O0O from to
stock account The Superintendent in his report says
The Engines and running property constantly de-
precating, and every few years large additions are re-
quired' This Company employs Is engines and IA
cars OF all descriptions yet you what their necessities
arc. What has been the policy of your Company? As
lar "a can find out by printed report il has been
10 take the entire revenue, less the actual train and Office
expenses and declare dividends leaving tie depreciation
fluid to be provided for by loans and those loans made
debt not upon the recipients of these dividends but up
on the entire line 10 Covington thereby compelling the
Western Stockholders to bear share of the respo nsb
y at present. and hereafter pay pro proportion
of the debt without any equivalent whatever. Where is
the justice OF such mode OF settlement The City be-
ing western shareholder, wish different mode
OF Keeping and adjusting the Of the Company
before we involve ourselves in any further liabilities for
the benefit Of Eastern shareholders.
Some steps should be taken by the Stockholders during
their next meeting to change the present policy Of the
Directory as regards dividends If they wish give to the
public confidence in their stock and the subscrip
ton necessary to complete the Road to CoviDgton
At present, the public suspicious OF your stock
aud very naturally for Is not reasonable expect beg
girs to make large donations Let the stockholders in
general meeting declare that dividend shall be made
until the Road is completed and paid for and You will at
for your stock, public favor and confidence
call upon you to be the pioneer in this work Of reform
Your oocdient servant
FRIEND OF THE VA. CENTL r. ROAD