The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1882-04-17

| Growth OF Business and It's Effect on
the Pool-The Balances Between the
Roads.
fridays Boston Advertiser says: The
interest in the question of a revision or ADAM
donment of the pooling contract between the
Eastern and Boston & Maine railroads, which
will expire June LIST, is not confined to the
boards of directors OF the two corporations, but
the matter is beginning to attract the close at
tention of the large stockholders, and is already
under discussion in outside railroad and fnan-
cial circles There have been during the past
eight years two pooling contracts, under which
the roads have conducted certain portion OF
their business. The first was entered into IN
June, 1874, and provided for the pooling OF the
business at competing points son the line OF
each road. June LIST, 1877, the second went into
effect By this the pool was enlarged SO as 10
include also the competing business East ana
West. President Lord of the Boston q Maine
said Thursday, the reason for this was to stop
the friction which was found to exist under
the old contract in the solicitation and compe-
tition for the business of the State OF Maine.
The Boston & Maine, under the new agree
ment, withdrew its agents from Maine, and
stopped active solicitation for business there,
and the Eastern road soon began to feel the
effect of the withdrawal in increased earnings
The contract was made, he said, that the
Eastern would have to pay the Boston q Maine
to let them alone. He thought the statement
published in the Daily Advertiser OF Wednes-
day last, to the effect that the Eastern road was
now paying the Boston s. Maine large
amount of money, was calculated to give
wong impression. That this impression might
be corrected, and the facts appear, he exhibit
ed table of figures by which it was shown
that during the past four years the aggregate
business of the Easte road has increased but
one-half per cent. more than that of the Bos-
ton & Maine; and also another table which
showed that for the eight years that the roads
have been doing pooling business there Is a
balance OF $1,000 against the Eastern road, or,
as he observed, only $4,000 year, which was
a small sum for the Eastern to pay as the price
of relief from competition. But the bearing
of the figures in this case is in their applica-
ton, and, from further examination OF the
accounts between the two roads, which we
have been permitted to make, some facts have
been ascertained which will tend to modify the
impression given by the above statement. In
the first place it appears that in computing the
balance of 1888, 900, sum of $4,000 received
from the Boston & Maine by the Eastern, I'M
der the old contract, has been deducted from
the amount actually paid to the Boston &
Maine by the Eastern under the new contract.
The amount SO paid is, in exact figures, $ll3,-
866.S5, or an average OF more than S20,OO0
year during the term of the contract. In the
second place it is noticeable that the payments
by the Eastern are continually increasing, and
SO largely that for the present year, on the
basis of the eight months already completed,
they will amount to more than $4O,OOO. The
following figures are interesting as showing
this increase. At the end OF the hrst year Of
the present contract there was balance OF
S6,743.21 on the second years business, $14,-
02S.06 the third, 1927 ,239.62; the fourth, $751;
933. o. and eight months of the fifth, $30, 92 80.
The bulk of this balance paid by the Eastern
road is on account of business received from
the Maine Central Railroad. The following
table shows the relative amount per cent. OF
this through business done by each road
freight. Passenger. Gross
Eastern; ..................S0 H. H. 49,
Boston g. Maine. ........20 28.9 23.l
After pooling and dividing the earnings on
this particular business however, it is asserted
that the Eastern gets but 1913 per cent. gross, |
and the Boston & Maine COL per cent The
average per cent of expenses to earning on the
whole business of the Eastern road is 6365 per
cent, which, applied to its share of 70 per
cent, which the company receives for the bus
mess it puts into the pool, leaves 1t only 1885
per cent. net. But, it is further claimed that
the per cent. of expenses to earnings on the |
through business owing to the lower rates |
than when taking the average OF the whole
business, is fairly to be set as high as 20 per |
cent, which, making the same application as
ah0ya 1aavag tho EaRtarn road but five |
cent. net profit on the great volume OF its |
through freight traffic; while the Boston q
Maine, without taking any of the risks of |
transportation, receives % per cent. clear. The
officials of the Eastern road appear to have |
come to the conclusion that they can no longer |
afford to pay, in the increasing ratio in which |
they have been paying, for the benefits which |
the road receives under the contract. They |
say that while the Boston & Maine road b as |
done nothing, the Eastern road has expended a |
large amount OF money, million and three
quarter dollars, to secure control OF the busl-
ness in the State of Maine; it aided the roads
east OF Bangor, when, they changed from q
broad to the standard guage, SO that |
cars could be run through from Ha lifax
to Boston; and it has purchased and is develop
ing terminal facilities for the accommodation |
of the business here. And now they claim
that the road is entitled to a fair return upon
the investments it has made. Indeed, they |
think it would get the business whether the |
Boston and Maine was actively competing for |
it or not, for by its stock interest in the Maine
Central Railroad it controls that corporation,
and it might, if necessary, lease the road so as
to form line, under one management, from
Boston to Bangor. The Boston and Maine Off |
cials say they will certainly accept no modifi- |
cations of the proportions of the present pool.
Rather than do that they will abandon the |
whole thing and have an en- tire change of the |
principles of the contract. The situation be-
tween the roads is becoming critical but the |
matter Is being discussed in friendly spirit, |
and each board of directors will undoubtedly |
be willing to yield something for peace. A re-
vival of the old feud would only demoralize
the business of both roads, and when the fight
ing was over neither party would have gained
any advantage for the natural conditions OF the
business for which they would have been COM
peting would remain just as they are now
The Journal Of Saturday, says; 1t has been
intimated that the bill now before the Legisla-
ture, which allows the Eastern to make a pre-
ferred stock Of its debt in excess of ten million
dollars, was intended to bring about consol-
idation, at least that measures to that effect
would be attempted. The plan suggested looks
to giving the Boston & Maine stockholders
$3.50 per share for their stock, payment to be
made in per cent. bond, which would
stand next to the present debt of the Boston q
Maine and the ten million debt of tie Eastern,
assuming that the consolidation would result
in a saving of $500, 600 in the operating of the
two roads, as is claimed, and it will be seen
that even by the returns of the roads for last
year even, that after meeting the rentals of
1881, $3O5. 600 interest upon the debt of the
Boston & Maine, $4,000 upon SIC, 100000 of
the Eastern debt, 100000 six per cent. upon
the Boston & Maine capital stock at $3.50 per
share, $566. 600, and $216 900 for six per cent
upon the preferred stock of the Eastern, that
there would be quite balance left for the
SIS, 600, 600 common stock of the Eastern. The
charges noted above would amount to So, 1885,
600, while the net income of 1852 O64 600
and the saving in operating of $500, 1000, as
claimed, foot up $2,364, 900 to meet the fixed
charges.
Cape Elizabeth.
fayc DAVIS since Mrs Ellen Cobh fell and