National Republican. (Washington City (D.C.)) 1872-1888, 1878-03-18

committee seems TO be one Of practical business
ra " .I man OF legal construction: 49,,
~ lnrhs up2n a Jew ihc's al 81 when arc nu
mltted and abont which there Is no dispute. un'
t der the oct ., 1m leg and the ses amenang
sdyanccd ~ ~ rnn,raI persac Wat,rneS Ca,n
p any; Of California, and tho Western Pacific Raii
y, oa Nh S ~ m Lnow pIncueay que 70, %
States ha,hs oWnnn,,n 4, ,ho ' soroaa,n 10 ,La
s,,n, 81 AZ ~ as9 Ths a v r s,hi, w..
os'r AL. ona g,,nn M rar,nS 6oar ye no
raMi,,n ,n,sro, rcr a,,,, ' bn in,a,a, rr H..
term ,hnreSnro Vii, an,onn, n, IA in S5i ,naLin
VIII nrinc,nai AZ iha ,os,,,ri,y ~ ,Sa nmds
,otai " ~ b"H on ~ ''e ina'ufi! vi '"e pohus'
I'nS A. ,be sspe .o,. thor. ,vos ,,su.a 4, tho
tJn,nu paciac Rs,,roaa r, w ~. ill., nr my
nnsos hanaa 10 s,nr 81 III ~ ~ ana pwn
pIn ~, , ~ w, = ~ sa ls,s s'a
VIM asaa, Itar " ue sha .r ", s1oS5Sg5i
and making total at maturity ofs7s. 1913.
Inc totai OF principal therefore s....... e5ooS2lR
Inc totai Oh Interest,". V'leSeo
Making q grand total at maturity of
bondso .....'................. la2os.lS
This large sum Is to be paid by the United States.
under and In Pursuance Of tho aforesaid acts Of
Congress. Current repayment springs from two
sources only:
or,v oro.ba,s os ,,o CONTAMINATION for ,orx,o.s
ronhorn3S nr ,bn az .,e @ ah io an
sbnIi he reouirnd IN ba annliad 70 ,hs nawmant ~
he bonds issued by he Government In aid Of he
,ymction az soia roeds SnctIon 4 90, az Iniy
? isSi. " '"'N '0"''' - ~ VI '"''
8 t,or Gaia rood 1. oor,r,a,.a ,,,u ..,a ho,,.
"a
, is ~ pi a,u =, I'M & y, to
aeniied w he payment ,barco, Sect3or an, ~
dpp1w $50 ''' p"'nie"' "e''o'''s'''o" u ae' Vi
The Interest paid by the United State. to and In.
issued 70 these corporations was s1l.S9S 2al %.
Under the first OF the above provisions OF law for
reimbursement, the United States had received at
said date, II2 iSlSc exclusive Of unadJusted
accounts ah h disputed ca,mS =, o,,o 81,
companies have made no payment directly, though
the United states has retained all Of the earnings
half Of which amount t the companies claim
should have been paid to them as they were
earned, and which they over exceeds the amount
due 10 the Government Tor hve per ccntum OF net
earnings since the road was completed, under the
most liberal calculation allowed by the law re-
ierrcd 10. controyersy has existed between
to the periodat which the second provision became
operative tho former insisting that y became opera
tive IN May, 1865, when the tracks OF the Union
Pacific and Central Pacihc Roads were connected,
making their lines continuous; the latter con.
tending that 1t did not become operative until
October ls't when the President OF the United
States, upon the report OF a commission appointed
b. him TO definitely fix the date Of completion OF
said roads. declared their completion as Of that
date.
The position of the corporations In this regard
has been sustained by the circuit courts of the
United states for the districts Of California and
Massachusetts,. Consequently nothing can be de-
rived IN the way OF repayment under the said
second provision except from net earnings subse-
quent 10 said last-named date.
=, Here arises another dispute between the United
States and said corporations The former contends
that the balance Of the gross earnings leN, AFTER
dcductng legitimate operating expenses, coustl-
ccntum Is to be determined and paid. The cor
portion plant themselves on the rule laid down by
the supreme Court IN -. John VS.. The Erie Rail.
way Company, y Wallace, 1876. and say that all
current debts and payments obligatory are TO he
dcuucted rom me gross earnings IN order to de-
termipe the net earnings irom which said five per
eentum Is to be paid. .,.
tained hy the. PRO i9rma decision Of the Circuit
tnurl ni inc lhted STATES ior the district OF Iowa
II The supreme Court OF the United States should
affirm this Judgment OF the Circuit Court, great
shrihRage must result IN the fund for the reim-
buTsenent Of the United states under the said sec
ond provision. At best and most the reimburse.
mcnt ofthe United states must, under both of said
provisions OF law for repayment, fall far below
even Tie Interest Of the bonds issued to said sew.
eral corporations in aid of the construction OF
their roads. Whatever remains over and above
these current payments, OF whatever amount they
may be- must be carried On until the maturity OF
said bonds This has been settled by the supreme
Court IN United States VS. Union Pacific r K. Co..
1Oto, y.
The most liberal computation warranted by ex'
stinc iHcls cannot place the amount which will be
the maturity of the said bonds on account Of prin
cipal aud Interest, at less than slOWOO00, As ST.
curity for this vast indebtedness, or whatever
other amount be II greater or less as intermediate
contingencies may order, the United States holds a
second mortgage on the roads and franchises o
the Sad CorpornlionS IL u feared That this Il more
than the properties will be worth at the maturity
the bonds.
What can be done by the United States and the
corporations involved 10 rs TO deal In the wiscs
way with this state ofcaSe? This Is a question o.
business; not of law. These corporations are the
ecbtnrs fthe United States They may prove sol
vent or insolycnt as We may wisely or unwisely
act. The whole amount due, and 10 become due
70 the United States may be saved, or II may b,
lost. The result depends much on our presen
sction. The case we are dealing with grows worst
and worse us years go by IL lett 10 tho plan of tn,
present law
The committee have endcavored to meet tn,
grave and exceedingly important subject commit
ted to them In u spirit OF practical adjustment II
order 10 secure to the United States ultimate repay
ment of the null amount of advances 10 these cor
porutiOns. without harsh or unnecessary embar
rassment to them. The substitute herewith re
ported, presents the mature Judgment of the com
mItcc, AFTER most careful consideration of the sub
The plan presented by the substitute Is simpl,
and yet effective. As hereinbefOre shown, In,
principal Of the bonds issued to these corporation
Is s5j691l 1872. The total interest for the term vii
be So, 6j35 The plan Of the committee is tn,
establishment Of u sinking fund which shall have
at the maturity of the bonds paid of all OF the in
terest aud several millions Of the principal loay
ing due and unpaid at that time about Sc ll2 $40
II Il proposed to divide this balance into I'M,
semi.ailnlial instnllments, one OF which shall b,
paiu on the first day Of April and one on the frs
day of October In each Year with interest Thereon
at the same rate per annum paid by the United
States OIL the larger part of It's public debt on TN