The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1886-02-04

commends the plan of equalized paw
lnents (Which Eas been adopted by the
senate J judiciary committee in framing
the elghty-vear bill reported this season.
Inc report continues: 1t has been sugz
gested that the government should re-
serve tie right to take up the underlv-
ang hrst mortgage bonds of the com
pany. when they fan due and acquire a
lien which their bonds have on the pro
perty. The arrangement would seem
to be desirable one on both sides. 1t
would make the lien of the government
upon the whole system absolute and en-.
tire, and. as government can borrow
money at 3 per cent, It would re-
duce the fixed charges upon the
property about $1,000. 900 per an.
mum below the present requirements.
This saving would soon retire the whole
issue of bonds-about SIS. 900 600. 1t is
most desirable, says the report, that in
any new legislation about the annual
payments should be definite and fixed
the same to be paid absolutely without
regard to the net earnings, gross earn
lngs or any contingency whatever, and
when this change is made IN the present
laws, restrictions upon the financial
operations OF the company imposed to
protect the annual net earnings should
be removed, that the company may be
1nemoarrassed in the use of credit.
Goyern.4-en cannot undertake to
manage the company on the whole. and
should not assume any partial
responsibility, but may feel en-
tire confidence that it is in no
danger losing its debt. As has been
shown above the entire issue of the
bonds and floating debt upon the
whole system is bat about $25 600 per
mile Should it become necessary for
the government to foreclose and take
possession by any default of the com.
pany, 1t could put a blanket mortgage
upon the whole at 3 per cent. which
would make the annual fixed charges
only $3.50 per mile on the line now earn
ing an average of about $500 per mile
gross and So 900 net. 1t is understood
by the government directors that the
company does not wish to be considered
as itself suggesting or advocating any
specific measures which have been dis
cuSsed above, or which may be brought
before Congress, further than to Point
out, to the best of its ability, the prob
able result of their operations. 1t claims
that if it had been left TO itself. it would
have been in position to meet all its
Obligations to the government and then
maturely in its own way, which was to
build up large system, capable of rais-
lug the amount necessary by the blan-
ket mortgage. The present and future
must now ne dealt with and some early
action is pressing necessity. And, as
some action is necessary, 1t Is most de-
sirable that it may be or once compre.
hensiye and final. For this reason, the
government directors confidently recon-
mend early action, and that it should
be based upon the principals of
the Hoar bill; the period being
liked at eighty years, under the
continued operation of the Thurman
bill, some further legislation would still
be absolutely necessary before the ma
turity of the debt This would keep the
company and its affairs in Congress for
twelve years longer, and under any bill
requiring payment of contingent
upon the net earnings. difficulties and
the question will continually arise be-
tween the company and the Depart
ment. Under the principles of the Hoar
bill the matter may be settled at once
and forever, and no longer trouble
either Congress or the courts. The
company would simply have to make
seml-annual payment or lose all its pro-
perty, and the amount at risk by the
government would grow less, and its Sc
curity greater year by year. The report is
signed by E. P Alexander, J. w.
Savage, NJ. A. Hannah, F.. K. Coudert
and Franklin MacVeagh.