The Portland daily press., 1877-02-08


Sundry failed and doubtful
Balance Of cash on hand
=, DEC. 1, 1870. 2,936lO
Fuel. NEUTRALITY-SUSPICIOUS.. 15,32700
-~--- sS,241.OO
s4,2Oo,3 1851
From the above it will be seen that the
aggregate of the net earnings of the
road from the beginning is. .,....... 1885 02,8 2
AS In the case Of the Portland u Roches-
ter Company, we find the amounts
paid for interest. discounts and COM
missions very large. ............,.. $770559.41
Add interest In arrears per exhibit b.. 1855 93l95
And the amount is swollen to- ........ 1926, 49136
sum more than double the net income of the
road from the beginning;-a sum third more
than realized from sale of the first bonds;-
and approaching in amount the whole sub
scription to the capital stock. An individual,
certainly, whose yearly interest account alone
should exceed his whole annual profits would
soon come to grief and no different rule obtains
between the management of private or corpo-
rate affairs in this respect. As matter of
fact, these payments of interest could only be
kept up go long as the supply from the city
treasury lasted; when that ceased to flow the
payments stopped.
It is but justice to the Directors, in contra
diction to the exaggerated rumors prevailing
on the subject, to state that but comparative
ly small sum, in all $6,391. 81, was paid as
commissions to part of their number for indors
ing the company's paper and loan of bonds as
collateral. The largest SUN in the aggregate,
covering over four years of time, paid to any
ono Director was $2617 IS. This may have
been for the pecuniary advantage of the compa-
ny, as it would, in all probability, have been
obliged to pay greater percentage to outsid-
ers at the time, and those Directors who receiv-
ed the commissions undoubtedly honestly be-
lieved that there was no Improperly in taking
gard it as q bad precedent for Directors, who
cannot legally make any profits out of the cor
poration which they serve, to indorse its paper
for compensation which must necessarily be
fixed by themselves.
As to the item Of $2,173 II, Expenses of city
vote" and an item of 1854 so, of the same sort,
in the Portland & Rochester accounts, our
good citizens who opposed the granting of aid
70 the railroad will hardly be pleased to learn
that the snews Of war" partly their own were
The payment of 500 900 on account of a Can
ada road, would hardly seem prudent, from the
standpoint of after years,-certainly, by cor
p0raton unable to meet its monthly pay rolls.
with the "Joint Consolidated Mortgage" a.
scheme, we learn, undertaken at the instance
of the Vermont DiUiSi0n, as one of the many
efforts to extricate both roads from their en-
barr assments, and which proved abortive.
The Endorsement of the notes of the YER
mont railroads, amounting with interest to
$55.562.07. was made to aid in finishing the
link OF fourteen miles. built in 1875, from West
Concord to Connecticut river, to form the con-
. neotion with the Portland Diuisi0n. Perhaps
this ie not of so much importance as these in
dorsed notes remain unpaid in the Vermont
banks, and the prospect of payment by either
Division is not fattering In case of the reor-
ganization of this company, however, it might
be troublesom to have them outstanding.
One mistake the commissioners think has
been made by the company which has tended
to bring the road into more discredit than any
other one cause. and that is in suffering the
monthly pay rolls to remain in arrears. On
compensated services rendered a railroad are
almost always sure to induce want of disci-
pline and an Indifference to the interests of the
road, and it is right that those whose labor has
gone into the earnings should be the first to be
paid ont OF them. The employees of railroad
nave moral lien upon its earnings which they
help to make-if not the legal lien, such as the
mariner has unon the earnings of the ship he
he.Pe 70 esvisetH.- THO ovmmieeienere a.e
glad to say that all parties in interest unite in
The opinion that Of all creditors of the road the
employees are to be paid first.
These matters have been noticed not in the
spirit of undae criticism, but as part of the
history Of the affairs of the road, and in pursn-
the city-the largest stakeholder and bond
holder-as full and fair an account of those
affairs as possible.
The last thing the officers of the road can be
accused Of is indifference to its interests, and in
respect to the matters above alluded to- they
undoubtedly acted in the premises at the time
according to their best directions and are not
to be judged of in the light of subsequent
events They would not have anything kept in
the backorOund-for to their honor be it said,
that whatever has been done has been done
openly and above board. The books show all
transactions. No attempt to cover up or con-
oeal anything has appeared, and the examina-
ton has demonstrated that personal upright
ness and integrity on the part of the managers
in charge of the road, which was to be expected
of gentlemen of their character and standing
The accounts of few railroads in the country
could have so well stood the test of the scrutiny,
OF this road have been subjected. The
figures show, too, that the read has been run
economically the expenses of operating falling
considerably below the average of roads.
The complaint on the part of the city, from
its standpoint of view, is not a want Of fidelity
to the interests of the road by its managers,
but rather the reverse; that in their zeal and
earnestness to carry the road through, they
have been less regardful than they ought of the
interests of the city, to whose lberality the road
dental advantages, they have lost sight of the
over-balancing disadvantages to the city, in the
detriment to its prosperity arising from an enor-
nous debt and burdensome taxation.
The unsuccess of the road is not attributable
to its management or the fault of its officers.
The causes lie deeper. The attempt was made
to build railroad from the seaboard to Lake
Champlain, a distance of 233 miles through the
White Mountains of New Hampshire and the
Green Mountains of Vermont, chiefly on credit
We say on credit, because the stock subscrip-
tons OF both divisions were wholly inadequate
and have been well-High eaten up by interest
and incidental expenses. Experience shows
that nothing but financial difficulties, disap-
pointmenss, and perplexities attend an effort of
this kind Ito which the Directors of this road
can no doubt fully attest;-and all these have
been increased manifold by the panic of 1873
and the subsequent business depression 1t is
useless, therefore, to cast about for secondary
causes for the condition in which we find this
road. 1t is the natural, inevitable result of un-
dertaking to build q railroad of this extent
without sufficient means-without money. AS
we'll might the Israelitsh bondmen of old try
to make brick without straw.
The condition OF the rOadbed equipment &C.
as gathered from Col Wildes' report of the report
OF the Railroad COMMUNIST oners, and also the re-
ports of John f. Anderson, Chief Engineer for
1875 and 1876, may be summed up in brief as
follows: The Mountain Section was pushed
through at the time OF its construction with the
intention of widening the excavations and en-
bankmsnts and completing generally that part
OF the road after it was in operation. Consid-
cradle work has been done in that direction; ;
thirty thousand dollars in addition, as it is est-
mated by Col. Wildes, ought to be expended
thereon the coming season to render it thor
oughly safe, and to preserve the work already
done. The Portland Section was originally con-
structed in the same manner, with view, after
IL commouCeu running, 10 replace temporary
structures by permanent ones and perfect the
road generally. That part of the road has now
arrived at that age when it requires pretty
thorough overhauling and reparaton in iron,
cross-ties, ballasting, strengthening or replac-
ing bridges, and the like, estimated to require
eighty thousand dollars the present year, and
the next year about an equal amount. The
road also needs. as reported by Col. Wildes, by
MT. Hamilton, the Superintendent. an addition
OF rolling stock to the amount of $45, 500. We
reg ard 1t important on all accounts that the
road should be kept up in a good serviceable
condition. An ill-equipped, unsafe. or inefi-
GENTLY operated railroad will not onlv fast RIM
itself out, but will be detrimental to the com
munity it is supposed to serve There are no
funds in this case wherewth to make renewals
aud separations except the earnings of the road
1t is very evident, therefore, that bondholders
of all classes cannot expect to receive any in
terest for year or two to come.
Perhaps something ought to be said about
the Vermont DiuiSion of the road, but it must
be brief. The course of that division has run
pretty nearly parallel with our own road; the
number of miles to be built by the two roads
was about the same; the amounts received from
subscriptions to the capital stock of each about
equal; the distances completed by each in 1872
not much different; the distance to be COM
IA