The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1867-02-15

proaches to the Chesnut and Walnut street bridges,
me city north Of Berks street, and the Fourth and
Eighth street road from Diamond street 10 Ger
mantoWn. Passed. Adjourned.
REPORT SUBMITTED BY CRY DREcToRs or
PENNSYLVANIA RAILROAD TO Cry CoUNcns.
The following communication was sent to
Councils yesterday by the City Directors OF the
pennsylvania Railroad Compan y:-The d.
rectors OF the Pennsylvania RailroadSCompany
representing the city have considered the reso-
lutioDs of Select and Common Councils of the
city of Philadelphia, IN relation to supplement
to the charter of the company, passed by the
Legislature in March, 1866 The Directors,
after quoting the act of Assembly, say:-"The
affairs OF the Pennsylvania Railroad COmpany
have, from an early period, through the in
structions of the shareholders, been admins
tered upon the most enlarged and liberal basis,
and under this policy II has rapidly grown to be
the most important work of the kind in this
country. 1t has not only extended its original
line OF but 248 miles in length from Harrisburg
to Philadelphia, but II has brought into sue
cessful use, by a liberal application of its
means, over HOO miles of branch and connect
ing railways, all of which add to the profits of
the main stem. II has now under its general
supervision, exclusive of the main line from
Philadelphia to Pittsburg, nearly 100 miles OF
railway.
The only expenditures it has incurred that
were of a doubtful character we're those d.
rected by the shareholders, or required by the
Legislature of Pennsylvania, committing the
tonnage duties. 1t is true that the Board might
have fulfilled the letter of its obligations in both
these cases by applying the amount required to
be appropriated by its principals TO the objects
directed, and then have charged of the sums so
expended TO profit and loss, and gone no fur
ther. The Board preferred advancing further
sums, with view not only to save their ori-
ginal investment, but also to make the works
they had aided partially TO build productive to
their shareholders and useful to the countries
Taversed.
list of the roads so aided and brought
successfully into use comprises the Pittsburg,
Fort Wayne, and Chicago Railway, 496 miles
long; the road between Pittsburg and Columbus,
200 miles; the West Pennsylvania Railroad,
between Blairsyille and Pittsburg, 40 miles; the
Evansburg and Cresson Railroad, 8 miles; the
Tyrone and Phillipsburg Road, 20 miles; the
Bald Eagle Valley Railroad 81 miles; the Bed
ford Railrc ad to Bloody Run, 20 miles; the
Mfflin and Centre County Railroad miles; the
Pennsylvania and Erie Railroad, 28S miles, etc,
The Directors have been enabled to meet
! the expenditures thus incurred without in
| creasing the Indebtedness of the company to
| the limit of its capital stock, while il still
holds assets in its vaults more than equal to its
first and second mortgages.
The increase of its facilities for transportation
must advance with the growth of the traffic OF
the country, This will require continual addi-
tlons to its equipments. to ITS tracks, to its sta
! tions TO its shops, and additional extension of
| branch lines. The means for these can only be
! obtained under the judicious limitation of the
| borrowing power OF the company by an enlarge
|
| sity that the cash dividends have been proposed
| TO be limited to not exceeding eight per cent.
| per annum. 1t was a subject of grave discus
| sion whether these dividends should not be
| limited to six per cent. per annum but the first
figure was UNANIMOUSLY adopted, and the action
| proposed under it, will if approved by the
Shareholders probably be dividend of eight
| per cent. in May next, three per cent. in cash,
| and five per cent. in stock, and in Novemoe
four per cent. In cash, and thereafter four per
cent. in cash semi-annually whenever unaccom.
| panied with a stock dividend S&R3H n
| The Board would have preferred to have
| opened the books of the Company to the share.
| holders for subscription tor this increased
| capital, according to the number of shares held
! by each stockholGer; but in adopting this plan
on previous occasion, the Directors met the
| decided opposition OF the city authorities in
consequence of her inability to participate in
such subscription. If this plan had been salts
factory, the Board would have preferred to
adhere to semi annual dividends of five per
! cent. in cash. The City Councils will doubtless
learn with satisfaction that the stock proposed
to be divided in May next is but part of the
surplus profits OF the Company. The remainder,
except one million Of dollars placed in oon-
tingent fund, it is proposed to apply to the re-
! duction of the construction account, with a
view to keep the cost of the companies books
| below specie standard. EHIm ~
These profits have been secured without an
increase Except on few items) of the rates of
the local tonnage of the line since the suspen-
sion of specie payments, which is, we believe,
without example in any other business. We
have great satisfaction in stating that in our
judgment the Oompany's finances are in a most
healthy condition. To provide means to enlarge
the capacity OF the Company's roads and their
equipment to meet the increasing traffic OF the
country, as we have already mentioned, an in
crease in the stock basis is necessary, and this
can be obtained in but three ways-by sale of
shares-by stock dividend of surplus profits
or by subscription by the shareholders in pro-
portion to the interest on each at par payable
in instalments as the money is required.
This latter plan would have been the fairest
and best suited to the views Of the Board but
the city, as previously stated, under constitu-
tional restrictions, could not participate in the
subscription and its consideration was aban-
doned. Instead of any disposition upon, the
part of the Board to water the stock, we can
state of our knowledge that the efforts of the
President and Directors have been to keep
down the capital account by applying surplus
profits to meet expenditures that are usually
charged to construction account.
Your Directors will also state that they have
from time to time conferred with the City Com.
missioners of the Sinking Fund, who control the
stock owned by the city respecting the pros
! poets and policy OF the company.
Very respectfully, your obedient servants,
ea LEWIS ELKIN,
| 49,. JOHN RICE.