Macon beacon. [volume] (Macon, Miss.) 1859-1995, 1878-03-23

lAA ENfN' W
and equipment, the balance at the rate
of $4,000 per mile to remain in the
United States treasury as one of the pro-
t~ections to the government against the
payment of interest"
"Do understand all of your bonds
are to be placed in the hands of the Sec
rotary OF the treasury to be issued as the
road is completed to ten.miIe sections y
d" Yes, the bonds are under the com
plete control Of the secretary of the
treasury, and Interest on the bonds be-
gins to Il only from the date of their
issue"
"1his Stephens bill, as adopted by the
majority of the committee, provides for
only a trunk line from Fort Worth to
San Diego ?"
eyes, that is all tnat the government
guarantees the interest on, but the bill
provides that the company, without a
guarantee Of interest, shall build from
some point on the eastern part OF its line
rs nov constructed to some point on the
Mississippi river, fixing its terminus on
the east bank thereof, not further uerth
than Memphis; these points to be ascer-
tanned and determined by a commission
Of five, to be appointed by the president
of the United States, at least three of
whom shall be ranking officers of the
United States engineer corps, and all of
whom are to be disiuterested in any OF
the proposed lines or their connections"
Glow is the government to be secured
against loss on its guarantee %
"First-By a primary mortgage on the
whole line to be constructed and all the
franchises, property and rolling stock
thereof.
"~Second-By retaining in the treasury
and applying to the payment of interest,
the compensation due the company for
all services performed for the govern
ment, including the transportation of
mails, troops, supplies and the Use of the
telegraph line.
"Ihlrd-The company relinquishes its
land grant and reservations thereof to
the government, which arc to be opened
at once to sale and settlement, the gov-
eminent to apply ene.half of the proceeds
of all lands within the reservation first
to the payment OF interest, and second to
the sinking fund for the redemption of
the bonds at maturity.
Fourth-The whole of the net earn.
ings of the road are pledged for the
payment Of interest. Besides this, So, 900
per mile of the bonds authorized to be
issued are to remain in the treasury, to
be sold rom time to time by the secretary
to meet any deficiencies on interest
accounts. This security is deemed ample
to protect the government against the
loss of one dollar"
What control does the government
retain over the roadY"
"Ihe right to the primary use of it for
postal, telegraph and military service.
and the absolute and unconditional right
to fix the rates of commercial traffic and
travel over the whole line from the Mis-
sissippi river to the Pacific ocean,"
docs the government nave such O
trOl over the Union and Central Pacific
roads o
at has not. BY the act incorporating
and substituting those lines the governs
meDt only reserved the right to fix a
maximum of rates when the net earnings
of those companies shall equal ten per
cent. on the cost OF construction, which
contingency is not likely ever to hap>
pen"
"What is the estimated cost per mile p"
"The average cost, taking the plain and
mountain country, is between $25, 900
and $500 per mile"
"What are your expectations OF the
profits and earnings of the road when
completed ~
awe expect to build the road for less
than one-third per mile of the cost of
the Union Pacific line. The cost of
maintenance and operation, on account
OF the lower grades and the more favor.
able climate, will be far less than on the
Union Pacific line. The annual interest
to be paid will not equal a third of that
paid by hat line. The difference be-
tween the Mississippi river and the
Pacific ocean on II line is several
hundred miles shorter than the Union
and Central Pacific. With all of these
advantages it is safe to say that our net
earnings will at least equal those of the
Union and Central Pacific, which are
shown by their official reports to be from
$4,000 TO $4,000 per mile per annum.
Our present line Of 444 miles, without
western connections, shows a net annual
earningo of about $1,000 per mile, ali Of
which indicates a profitable operation of
the whole line"
"Whence, then. the necessity of a
guarantee OF interest by the govern
ment ?"
"Owing to the financial distress snd
the great want of confidence in all enter,
prises, even the securities of old and we'll
established lines do not find ready
market, and the securities on lines to be
constructed are scarcely marketable at
any price, or, if at all, at such heavy
discounts as 10 make the cost of non,
structlon so enormous as to deter pru
dent men from such ventures. With the
government guarantee, as sought. the
bonds can be sold at par, which will on
able the company to construct its road AT
a very low cost, and its interest bearing
Indebtedness, instead of largely repre-.
senting discounts, would represent only
cash actually invested in material and
cOnstrp CtiOn II is imnossihla E,r A.