The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1877-02-08
POrtland's Railroad
Liabilities.
Full Text of the Com
missions RepOrt.
THE RISE AND FALL OF
TWO RAILROADS.
Our Burdens and How to
Bear Them.

A special meeting OF the City Council wa,
held last evening to listen to the report of the
Commission appointed to investigate the cond
ton of the Portland & Rochester and Portland
and Ogdensburg railroads. Both boards met ir
joint convention and Mayor Fessenden read
the report, the reading occupying one hour and
forty minutes, The report wac accepted and
5000 copies ordered printed. The following is
its full text:
TO the Hon. Mayor and City Council of the
City Of Portland:
The Resolve under which this Commission is
appointed is very broad in its terms and covers
a good deal of ground. 1t contemplates, how
ever, in substance, an examination into the
affaifS and condition of the two corporations
named, and the state of the relations between
them and the city, and report thereon, with
such suggestions and recommendations on the
part of the commissioners as the case may
seem to require. Perhaps no more important
event in our municipal history has occurred
since the great fire, or one that has awakened
more pubic attention, than the default of both
these railroads in the payment of the interest due
the city according to the terms and conditions,
under which aid to large amount was granted
to them respectively The significance of the
| event may be seen in two aspects. 1t indicates
| want of that success thus far in these two
| enterprises which was so confidently antici-
| pated, and no doubt honestly predicted at the
| outset by their several promoters; and it raises
| directly the questions as to what will be its
| effect upon the finances and credit of the city,
and to what extent. in these times of business
| depression, it will increase the burdens of our
| already heavily taxed cOmmunity;-and also in
what manner those burdens may be arranged
and adjusted so as to bear as lightly as possible
| upon the industries and business of the city.
The commissioners have fully felt the import
ance of these subjects. and have endeavored to
/ give them the attention they demand. In the
report which they have now the honor to make,
| it will be their aim to present and dwell upon
| the facts as they understand them, rather than
to indulge in speculations of their own, or give
prominence to their own views. The facts in
| regard to the affairs of the two roads, and in
| regard to the state of the finances of the city
| are what are wanted by our tax payers aud
| property holders Those on whom devolves
the payment of the liabilities of the city ys con-
tracing, desire to know, and are entitled to
| know with all reasonable exactitude, the actual
| situation of things, whether favorable or un.
| favorable. Possessed of the requisite knowl-
edge in that respect, our fellow citizens are in
| position to draw their own inferences and
| conclusions, and to make up their minds as 10
the value of any suggestions and recommenda-
| tons herein made.
| The commissioners have been met through
| out their investigations il a spirit of courtesy
| and frankness by the officers of both roads;
papers in their respective offices, and ali de-
sired information has been given in a straight
| forward manner.
The commissioners also have been greatly as
sisted, especially IN regard to the financial
affairs of the city, by information and Sugges-
tions from his Honor the Mayor, who has uni
formly attended their meetings and manifested
the greatest interest in their lAbors They are
also under obligations to Mr.. Hersey, city
treasurer, and to Mr. Robinson, CITY clerk for
infOY m from their rasp 0ffioop
The two experts whom the commissioners
have employed, Col. A. W.Wildes of Skowhegan
to inspect the condition of the roads, and Mr.
r. Stuart Chase. of Raverhill Mass, to exau-
Inc their books and accounts, have performed
their respective duties very faithfully and ac-
ceptably.
1t will be more convenient to commence with
the affairs of
THE PORTLAND & ROCHESTER, RAILROAD COM
PANY.
| This corporation is the result of the reorgan-
ization of the old York & Cumberland Railroad
Company, which, after a troublous life of
constant litigation, ended its corporate exist
ence, Oct. 4, 1865. Thereupon the present
company succeeded to railroad extending
from Portland to Saco River, a distance of
eighteen miles, in dilapidated condi ton. but
comparatively free from debt; standing on the
books at a nominal cost of 1865, ,519 80, but
really worth in its then condition some $780, 000
Mr. A. 2 Robinson the first engineer, esti-
Il udttu u Tdilfodu III SOOu COnQlGlOB between Gn6
above two points to be worth $250,O00 and
| would pay per cent. on that sum. Subsequent
events have proved this estimate to be in the
main correct. The York & Cumberland Rail-
road Company was Incorporated in 1916, to
extend from Portland to Berwick or South
Berwick, there to connect with some railroad
leading to Boston. During the last years of its
| life the project was broached, and considerably
| discussed, to change the proposed western ter
minus to Rochester N. H., there to connect
1 vuitb rood f,l l>o 6,,;If tho N
| to join the Nashua & Worcester road, thus to
| form continuous line from Portland to New
| YORK, and also new route to the West The
scheme was good one on paper and to this
| day theoretically it cannot be bettered. This,
too, was in the flush times after the war, when
| everybody was rich and believed in railroads
| In popular Imagination there existed in all
| directions, vast reservoirs, from which, if only
| tapped by railroad. would flow perennial
| streams of traffic. Ir the hopeful language of
| the tunes this new route was to occupy a COM
manding position in the chain of roads between
Halifax and New York; it was to be an addi-
tional outlet to the Atlantic for the products of
| the West. When, therefore, the new company
succeeded to the old, it was determined to make
! the aforementioned change of terminus and ex-
/ tend the road from Saco River to Rochester
| At the next Legislature in the winter of 1866
| by private act, the necessary authority was
gwen, and by the same act, the City of Portland
was authorized to aid in the construction of the
Il
a bona ide subscription of stock to the amount
| of $150,000 should be obtained. This subscrip-
| tiop, it appears was never raised
The following year the city began series of
| advances by way of aid to the road, of which
| the following is synopsis:
/ l. In February, 1867. the Legislature passed
general law permitting citiessand towns by a
| two-thirds popular vote, to grant aid in the
| construction of railroads to the extent of five
per cent. OF their regular valuation for the time
L bajp hp ait fO loo
| $780, 900 in aid of the Portland & Rochester
road; and 100000 in aid OF the Portland &
Ogdensburg road, then just chartered. The
latter did not accept the aid in this form, as
will hereafter be seen; but the former con-
cluded to do so; and ON June 9th, 1867 twenty
| year six per cent. Bonds of the city to that
amount were issued to it, secured by a mort
1 gage OF the road running directly to the city,
without the Intervention of Trustees, and con-
| tanning power OF sale in the usual form; and
also, upon condition that only $250,0O0 should
be expended between Saco River and Alfred.
This condition proving irksome, year
| after, in June, 1865 at meeting of electors of
the city, which was called upon petition of
1 Directors, this restriction was removed, and
100000 in City Bonds were issued to cover the
expenditures to Alfred. This sum, however,
was to constitute part of the 100000 already
| granted.
.s5 8. ~ With the proceeds Of the 100000, and
900 additional, subscribed by parties along
the line, the road was completed nearly to
Springvale, in the fall of 1870, but could 60 no
further without new loan. This, the Directors
represented, could not be negotiated unless the
city would waive its exclusive rights under the
first mortgage, and agree that the security OF
the new loan should be placed upon an equality
with that mortgage and therefore, by vote OF
the City Council, passed Nov. 1st, 1870, and
approved by the Mayor, the proposed mortgage
of $350,000, at seven per cent. interest, and
payable the same year as the City Bonds. 1887,
was made, (if such action was legal), sco-eouai
and concurrent" with the city's mortgage, in
all respects as if the two instruments had beer
executed contemporaneously.
| 4, The next year more money was wanted
and new $3.50, 900 seven per cent mortgage
was executed on the 30th of November. 1871
on twenty years, to secure the company's bonds
for that amount. The bonds however. could
find no purchasers. Luckily for this company
the Portland x Ogdensburg road the nexi
winter, 1872, applied to the Legislature for a
special act, authorizing the city to grant addi-
tlonal aid to it. This seems to have induced
the Portland & Rochester to put in its applica
tion also, aud both roads were enabled not only
to get their respective acts through the Legisla-
ture in the month of February, 1872, but asC
| by uniting forces, at ward meetings held the
| next summer to DrOcure those acis IN he ac