The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1877-02-08

| 1S'oI roaO, Settlng 1Ortn tnelr nnancla
straits, the City Council with very littl
pressing. it is said, by an order approved by tn
mayor, gave up these 1000 shares of stock to tn
| company. This was in June, 1873.
| o. Inc next year in June, 1874 (June seem
70 c, nave oe oeen hard month with the roa1), tn
| S4oo'vUo being all spent, the city was notified
tnat Tue Company would be unable to pay tn
| interest," on its loans. and thereupon the cit,
very kindly undertook to pay the city the inter
es. uue the city, by the issue of its sixth yea
SIX PER cent bonds. The company agreed t,
pay tne interest on these last named bonds, ant
tne principal at the end of the six wears: bu
after paying this interest as interest for tw,
years, doWD to July 1st, 1876, it then made de-
fault, and the city has paid the same since n
the amount of $9315 down to January list
1877, and must of course pay the principal a
maturity. ="
z. And finally the city has expended for the
beneht of this road the sum of $1OO, ,423. .27 II
building what is called the marginal way t(
connect IL with the Grand Trunk Railway,
Leu US see how it stands July 1st, 1877.
REcAPITULATIoN.
City bonds and aid, due July, 1887, 800 ooC
SIX year bonds for arrears of interest, POI OO(
Ah'eAse' on saihe .'".'.................... 9.31s
1886, ,31s
In addition to the above should be taker
into account The expenditure On marginal way,
IA.
the Rochester and Nashua stock given up,
reckoning no dividends 100000, TO all which
must be added whatever loss the city has sus.
tained by REIMBURSEMENT of security in favor OF
the S350O00 mortgage
The question has been raised as to the vail
dity OF this REIMBURSEMENT The point is taken
that the city council, by vote approved by the
Mayor, had no authority, without legislative
sanction, to modify or change the original
terms and conditions under which the city's
credit was granted to the road, in accordance
with the two thirds vote of the electors of the
city in ward meetings legally assembled, and
make the two mortgages ''co-equal and concur
rent" The commissioners do not propose to
enter upon a solution of this question whatever
their opinion might be it would not be binding
on the parties. 1t does not practically arise
yet. 1t may be settled amicably between the
bondholders and the city. If not, when the
time comes for it to be solved, confined as it
is to single point,-an authoritative deciso n
can be readily had by recourse to the Supreme
Court of the state
In view of the foregoing facts, the city can
not certainly be accused of want of liberality TO
this road. A fond mother could hardly have been
more indulgent to favorite child. To ask was
to receive; to knock and the doors of the CITY
treasury flew open. 1t is not the province of
the commissioners to pass judgment upon the
wisdom or prudence of the use of the city s
funds and credit to the extent indicated above
in an enterprise of doubtful expedency and un-
certain result. Such policy having been once
adopted they have only to consider the state of
things as they now exist. Jtmay be remarked,
however, that if uybody is censurable, it is a
case of divided respons' bility The city and it's
authorities seem to have been as ready to give
as the managers of the road were to ask. 1t
was hardly in human nature that the latter
sanguine-having faith in the road and strug-
CLING to push it through, and devoid of means
should not avail themselves of the outflow
a n n fail Of uvrIxr t.
be borne in mind, too, that most of these trans.
actions took place when the railroad fever was
at its height, and few had wholly escaped the
contagion. Public sentiment on this subject is
very different in 1877 from what it was previous
to 1873. Still it is wonderful that il did not oc-
cur to the parties concerned, even then that
there was danger of killing the goose that laid
the golden egg
We proceed to give summary of the present
financial situation of the road. Part of the
accounts have only been made up to Nov L.
1876, the latest date of the returns, but the op-
eiating receipts and expenditures for November
and December, 1876, will nearly balance, so
that the exhibit will be practically as of Jan. /,
1877.
The books and accounts, since 1878 under the
present treasurer, are in excellent condition.
the outlays properly vouched for, and the cash
account bearing the most rigid scrutiny. But a
faulty method has prevailed in the entry of
outstanding bills at the end of the business
year. charging them to Surplus account and
finally transferring them to profit and loss''
account without including them in operating
expenses. OF this more will appear hereafter
And no materials account" was kept on the
ledger, although statement of materials on
hand was returned annually by the superin-
tendent. Prior to 1928 the accountant reports
that the books were less Systematically and ac-
curately kept; but from a thorough examna-
ton of them the final balance comes out re-
markably correct considering all the circum-
stances, there being found only discrepancy
of less than five hundred dollars in some ten
years business, and which hereafter will un-
doubtedly be discovered, thus showing all mon
eys which the company received accounted for.
The secured debts Of the company are as fol-
lows:
Mortgage to the city of June a. 1867. $7O0OO0C0
'' trustees for the benefit Of
Arrears Of interest on both. .,.... 2i6.315OO
1896 $500
Seven per cent mortgage of
NOV. Is 1871 S30U
Arrears of interest to Jan.
- s69, ,2s1. so
$1,7S5, 5,546.59
Deduct sinking fund and interest to Jan.
/, ...............,............ 73,O1s1s
Total secured less sinking funds 81 ,662, ,52S. .32
Unsecured debt as found by accountant,
less quick assets ts..................... 53,2139i
Total secured and unsecured debt. ST. 7l5 742. %
The interest payable by the company on this
amount OF debt must exceed 100000 per an
mum, and constantly be increasing as the debt
grows larger; while on an average for the last
eight years, according to the accountant, as will
be seen further along, the net earnings do not
exceed 500 900 per annum.
The net proceeds received by the company
from the sale of bonds is as follows:
Principal Discount and Comm. Net Proceeds
$7O0000.00 $52, 500 00,-74 per cent. $647 10000
350000.00 I4,573.T,-44 Z" 335, ,426. .S3
45OO00.0O 36,403.75,-S Ito GO 1885 25
sl,5OO,OOOOO s1O3, 1852 ST. ,523 Os
The following is general balance P. & r. r..
Go. from beginning to Jan. l, 1877:
RECEIPTS.
Stock from Y. & c. Railroad
Co bonds ..".....:.. S565, ,5!939
Do sold towns and others,.... 69,764.83
- $635,2s4.22
First issue of bonds to city,
June "a, 1867. .............,. .$7Oo,OOOOO
Do 7per cent bonds to trus-
tees, Nov. l, 1870. 350,000.00
Second do to trustees for ben
eft Of city, Nov. 8, 1871. 45O,OOOO0
--1 500 900 90
Net operating income from beginning. 5iS57 50
Balance bills payable account. ......... 259l0.49
Ledger accounts and bills unpaid. -. 13,20O 46
Balance due connecting roads. .......... 14,222.23
Profit and loss account, 1878. ..,........ S1.64
$2,343, ,562. SO
OUTLAWS.
Specific construction. ...... 81 6G7 ,770.0O
Equipment. 120020.60
Trustee rolling stock fund. 9,i22,S 80
- i, ,757, ,2ls.47
Interest paid. .............. 3S5, ,fS8 43
Discount and commissions. 116, ,122.22
~ - sol, ,6iO.s5
MISCELLANEOUS.
Legal services ($14O1.4l since
$780,; .$5s25H
Eynens 80 hopds and pntes 14S3
Expense in New Hampshire 1030.13
Excursion on opening road. 6l2 Oh
Incidentals, including 1854 80, ex-
pense of city vote. ........,.. 1155.I5
- 13,lO6.7s
Sinking fund. A accumulated in $4,000
city treasury to
Jan. /, 1877,
4s,5OoOO
Cash on hand and due from agents,..... 1l.s6111
Materials on hand Observation-Disclosures. 10,S21.5C
Variation rot vet rectified d...,...... 44272
$2,343, ,562.s sc
The large amount of interest, discount
and commissions exhibited above will
attract attention, amounting togeth-
er Observation-Disclosures. $50l, ,6l0 6t
Add arrears of interest unpaid ........ 235, SAT 5t
And we have the still larger sum Of So. $751; 1921
showing the wastefulness of attempting tC
build railroads on credit instead of cash, and
constituting one important element in estimat
ing the present cash value OF the road and iu