The New York herald., 1876-02-26
STREET RAILROAD FINANCES.
A Remarkable Chapter as to How
the Money Goes.
INTEREST ON APOCRYPHAL DEBTS
A Company that Runs Only
Twenty Cars.
Fares To Be Reduced When Profits
Grow Too Large.


and entitled TO consideration whatever Tho stock
holders realize their Investments according to the
Official reports from ten to twenty per per annum
and besides this gain system has been introduced or
representing hoavy indebtedness, for purpose TO be
presently indicated, of a most Intangible character.
The aggregate Of the stated TO be owing by the
several companies In this city Is fully $40 000 far
than the roads worth put together and about
equal amount is also stated TO have been paid
capital stock and dsbursed for their construction and
equipment Out of the earnings OF the lines, and
totally distinct from dividends interest Is paid
alleged to be paid the vast amount of indebted
ness just mentioned. To whom the money Is due is
not given does it appear If borrowed lent
that employed for ahy legitimate purpose in
necon with the roads. But the public, remarked,
is interested this matter for the reason that they
expected to suomit TO gross imposition the hands
of the railway companies in order that they may fill
the pockets of parties to whom they (lhe people,
nothing. There is kind OF cgerdemain as will be
seen in the mode OF originating and carrying horse
lines by which from forty to seventy per cont
than called for is paid for construction and thon
making tho libersIly given away the of
a perpetual drain on the income of the business How
this happens il would be very desirable to know, and
thereby hangs tale
FAREs OUGHT To BE REGULATED BY PROFITS
In any view OF the matter there bo sound
advanced for the neglect OF supplying sufficient
number Of to accommodate the public. Several
preenccs have been offered 10 blndfold but one after
tho othor when examined turned out TO be spurious
All that Is needed is TO put on the additional
vehicles incur additional expense, and The diff
Guilty is OF end. But the parsimony and greed Of
the directors prevent this action and IL 10 only by such
law as is now pending in the Legislature, making
overcrowdng criminal offence to be summarily
dealt with, that the scandaous abuse
be suppressed The earnings and profits OF the COM
panles should be curtaied. What with interest
fictitious debts and dividends tho happy stockholders
working rich mine out of the working and poorly
paid bees OF this great hive whose health and comfort
are so shamefully d.sregarded. In England and in
other European countries when the profits OF street
companies 60 be- ond certain figure they are by
law obliged 10 reduce the fare Some such enactment
is required in New York However, are informed,
er-cdedrd that all claims OF passengers to be treated
civilized beings is prcrosterous, and that TO talk
of giving seats to the thousands who all want TO go
from one and of Manhattan Island to the other is
''smply absurd and Impossible" " And yet this pre-
posterous and absurd claim or tak s what The street
car companies agreed TO do with Their eyes opcn and
in consideration Of which they obtained and now hold
franchises of immense value Tho gentleman who
speaks Is president OF an important nc yet he comes
back like all others interested in the roads who have
spoken the subject 10 the question of additional
expense and less gain Here is where the shoe pinches
The profit told again. is only threc-ten,hs of
each passenger, rs If that statement was con-
vinciug IN presence OF admitted earnings allowing div-
dcnds oftwenty per cent The gentleman referred TO docs
not after ALL believe 1t to be impossible to run more
vehicles as he thinks If the companies arc compelled
TO furnish them they Will not be costly those
In use sold would be without repairs as long
thoy would hold together, and new ones would be
made plain and cheap possible Let US have tho
cars any how, and law making it obligatory to keep
them that every one who pays faro shall be
furnished with seat In elucidaton Of what precedes
notices OF the financial affairs of several OF the
panies are appended
The Belt line takes in circuit Of the city below
Central PARK, by way OF West and South street. IL
consists In fact, OF two separate routes embracing
length OF eleven miles About fifteen million people
travel on the annually, and the company, known
as the North and East River and Central Park Rail
road is regarded OF the most prosperous in tho
city The franchise enjoyed by 1t Is considered Of great
value But, unlike the Third Avenue Company, the
directors do retain at the end o the year hundreds
OF thousands Of dollars with the intention Of
showing that the profits to investors arc one
half what they are IN reality. The receipts
from passengers are about $4,000 annually, and OF
this 500, 600 is paid for interest, not dividends
The North and East River road declare that the capt.
tai stock, 81 800 000 is all subscribed and paid up
proper form The cost Of the road and cvcryh ng ap
pertaining TO it is further represented at 81 l25 600
IL would appear, then, to ordinary person. provid
inc that these figures be correctly stated that the com
pany required 1925 900 in addition to the capital
tualy paid in TO complete and place in running order
their roads But debt OF 81, $50 0C0 is cd TO be
due some parties unknown, which Is exactly 100000
moro than required for any apparent purpose
Out OF profits of the traffic interest at the rate Of
per cent per annum Is pail on this hugo sum,
and nobody is able TO explain how and for what pur
pose this debt contracted and f contracted at ALL
what has become or what use has been made OF the
money. People are deprived Of proper accommoda-
ton in travelling on the cars as stated before, IN con-
sequence OF the necessity that seems to exist to realize
huge returns in order TO pay heavy interest on large
presumably fabricated debts The less cars run tho
greater the gain Hence the hide0us system OF over
crowding, which is happily approaching its end
AVENUE LINE.
on May 25 1874 the real estate tracks cars, horses,
franchises, &c., OF this line were purchased at public
auction for $500 0j0 by John Lowry and others, who
organized under the name of the Houston Street, West
Street and Pavonla Ferry Railroad Company. The
financial statement OF this corporation is, liko all tho
others, mysterious. though regarding lis recon. Icx
start and the specific statement as to seal D6 sud
expect clear and plain sailing The s1norized capital
stock is $780, 0On a opiy one half of this sum has
/ hcd and "
TO be raised TO pay tho purchase money OF the road
But the company ess than two years has contrivod
get 10 debt Just $50 OO0hat IS 5000 COO moro than
the original Investment The line has always been and
contindcs 70 6e profitable The couSdram no~eger co e
remains 10 be solved TO how required f1op,Ooo 70
/ meet purchase amounting TO $3Oo,OO0
THE SECOND AVENUE LINZ.
The cost of this line, including road bed, supcrsruc-
ture cars, real estate, &c stated tQ DO 81 GOO O0
II is however gelyfay undcysto0d 70 be the practice
TO place valuation coas:3 eTfSy sbove actual Qullayi
and when aoYsnee Of siy iwShly- ave pcr cSnt IS
iakcu or over estimate tho corrvO. tTcs
are about reached For Instance where cost Of
ST. eco 900 reported S750 eco is about the mark, and
Is on 60 greater amounts. The capital stock paid in OF
the Second Avenue Company Is $1,000, 900, sum am
ply sufficient to put the line IN the best running order,
with horses, buildings aud all other accessories The
profits Of the traffic arc enormous and as matter OF
course heavy dividends are realized BY ths serene
stockholders. nuI cvmps., a..-...s.,~s . .vv.
OF $3.50, 600 Here have a sufficient amount or
money Subscribed TO and operate the road and It
goes into highly successful business dividends arc
doclarcl regularly aud all looks clear and bright
But through some means debt such as
just stated Is created, for which nothing
whatever can be shown in tho accounts
except that 500 COO Is paid annually fer IL
Vhcl railroad men answer the demands of the people
iof Sufficient number ofcars TO enable them to travel
deceny through the city by saying that we are too
poor thatsuch an increase would lead TO something
like next door 10 bankruptcy they aud Insult 10 In
jury When they speak OF imposshililcs in reference
TO running more vehicles they 20 directly In oppo-
son 10 he opinions aad experience OF the ablcst
gnec's who nave made The subject study since 1888
when street cars were first introduced for general
traffic The opposition IS simply, as has been re-
peatedly stated 10 these columns that would cause
csseniug OF profits anu that the companies will rc-
sst the reform regardless OF thor agreements with tho
city and the health and convenience OF the people as
long as they II would take only portion OF the
500. 900 yearly pad by the Second Avenue Company
on us wio Of funded debt to furnish pfopcr
service TO the public, and yet there would remain TO
us stockholders dividends ranging FROM twelve per
cent and upward per annum.
sONE RASH AND NOVEL STATEMENTS