The Rock Island Argus. (Rock Island, Ill.) 1877-1885, 1884-11-28
PACIFIC RAILW AVS.
TIE QUESTION OF NET EARNINGS
CONSIDERED.
What the United States Railway Commits
fioner Has to Say About 1t i His Sug-
gestions a. to the Funding OF
the Railway Debt.

WASHINGTON CRY, Nov 28 - In |
his annual report the secretary Of !
the interior says: The comml soner |
OF ,ailraadS calls attention to the |
conho s. betw et thu government |
and ynr Union Pacific Hallway company as
TO what constitutes met earnings ul.der |
the act Of May {, 1873. The cor
Iearondenco bearing on this subject |
WAS printed in his report lor loS3
pages 3i-3i. a bill to authorize iii, fund
m1 II the debts of the Pacific railroads
beng unier discussion i'll the committee of
judiciary oi the senate Mr.. Charlie Francis
Adams, jr, then a director OF the Union Pa
ciiic Railway company-now prasldent-ad-
dressed a communication under date of June
II. 1851, to Hon. George F. Hoar Il member
OF the committee. i'll which he pro
posed as a basis of settlement pend
ing action of the courts, that no diyi-
dends should be paid on the stock
of the company during the current year;
that the government should withhold pay
ment for all services rendered, not only Un
the aided but the non-aided portions of the
read and that the company should forth
with pay into the treasury, on account of the
sinking fund the sum of S7lS, ,S146j, being
the amount found due the United States, in
cash. for the year ending Dec. 81, 1855. On
the same date Hon. Geo +. Edmunds, chair
man, informed this department that the com
mittee on judiciary of the senate had passed
the following resolution:
| Resolved That this committee will post
| pone until the first Monday n December,
1,,,nf = IL
| ters arising under the act of May /, 1873, re-
| lating to the Union Pacific Railroad com
! pany, etc, if the said company shall lmme-
| ,liately carry out the offer of Mr. Adams as
stated i'll his communication dated June II,
| 1884, addressed to the Hon, George /. Hear,
| and on tie express understanding
| that this action Of the company and of the
| United States in receiving the money and
| security in said communication mentioned
shall have no effect on any penalty or for
tciture OF other right of the United States in
| CURED or arising, or to occur or arIse,
| against the said company or any OF Its
officers. hut that all rights penalties and for
FIXTURES shall stand as If these acts had not
been done.
Pursuant to this arrangement the Union
Pacific Raj way company deposited with the
assistant treasurer Of the United States at
Boston, June 20, 1881, the sum of S71S, ,Sl46 60,
to be carried to the credit Of the sinking
fund, but it is not to tie considered that the
company assents to the governments state
ment or claim of the amount of net earn
ings or the elements that should enter
into the determination of them. The
company also reserves the right Il
have judicial determination of tht
amounts to be paid by the government fol
transportation, and also what shall be lie
lucted from gross earnings in order to a5cer
tain net earnings The company has aist
hlel, under its corporate seal, an assignment
Of all its earnings for transportation service
rendered for the government over all line
owned and operated by it, This aSsignmen
remains in force until matters in dispute. ar
finally determined.
The total balance claimed by the govern
ment as due in cash from the Union Paciii
Railway company under the act of May
1878, for the period from July l, 1873, t
December 81, 1882, amounted to 81, 721, ZAP. -
but the sum of 500, 35S. So deposited wit
the assistant treasurer at Boston July x
1881, having by consent of the company bee
accepted June 30 1884, as payment on al
count and covered INTO the sinking fund, tn
amount is reduced to 81, l,65S, 3S5. II. II Ii
whole amount claimed by the company o
account OF the contested items for now coi
struction and new equipment should be d.
Quoted, there would still remain an uncol
tested faance of $967, 1868, which the con
pany claims is overpaid by the additional a
loUance it will receive for carrying Il
mails
The commissioner also invites attention
the subject of the funding of the debts of Il
several Pacifd railroads, and renews his su
gestion that the present uncertain mode
payment be commuted TO one of fixed OBJ
cations having the same lien 1t is mantle
that the act of May 7, 1873, has n
- adequately accomplished its purpose.
would seem of the highest Importance tn
Congre ; take immediate and final acti
looking to the ultimate payment of this
dehtedness. Under existing law the de
is steadily increasing at the rate of ov
8, 900 600 per annum | am of opinion th
the tao, method Of dealing with this
debtedness would be to authorize the fuI
ing of the debt on an extension of time, n
to require the payment of fixed amoui
at stated periods. In consideration OF t
extension, the companies should be
ouired to file assignments of all earnings
- ready accrued for government transpor
ton over non-aided portions of their roa
All future earnings for like services o.
all roads owned, leased or operated by th
companies should lie pledged by the ter
of The act to the payment of the accru
} jnstallments of the debt as they mature.
"a If it be not deemed by congress expedi
to thus fund the debt the discretion OF
secretary of the treasury as to the in'
mept Of the sinking fund which is now c
fined to ! PER cent United States DO
should be enlarged, as the interest Of
whole investment thus far made has not
- equa.ed the premiums paid for the bonds