The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1888-01-18
PACIFIC RAILROADS.
The Presidents Message to
~ yrI Congress. T7
THE COMMISSION REPORTS
TT is Quite Time That tue Trouble
some Complication Should be
Adjusted and Settled t
The Prestdent's Pacific Railroad Mes


WASHINGTON, January 17.-Following
is the Presidents message transmitting
the Pacific Railroad reports to Con-
gress:
IT. the Senate and House of Representa-.
tiveS. s.
On the third day of March, last, an
act was passed autho rizing the appoint
ment of three commissioners who
should investigate the affairs of such
railroads as have received aid from the
United States government. Among
other things contemplated, the investi-
gation included history of the con
struct,on of these roads, their relations
ana Indebtedness to the government,
and the question whether, in the inter
est of the United States, any extension
of time for the per ormance of the obi
cations of said roads to the government
should be granted, and if 50, said COM
missioners were directed to submit a
| scheme for such extension. The COM
missioners were further directed by said
act to report in full to the Pre- ident
Upon all matters submitted to
them, and he was by said act
required to forward said report 10 Con
gre IS, with such recommendations or
comments as he should see fit 10 make
| in tha premises. The commissioners
| Immediately after their election. en-
tered upon the discharge of their duties,
and have prosecuted their inquiries and
recommendations with industry. intelli
| genoa and thorOughness. A large
amount of testimony hiss been taken
and all the facts been developed which
appear to bI necessary for the consider
alton of the question arising from the
condition OF these aided railroads d
| their relations to government These
commissioners have, however been un-
able to agree upon the manner III which
these railroads should De treated re-
specing their Indebtedness to the
United States or to unite upon plan
best adapted to secure the payment OF
snch indebted ness. This disagreement
has resulted in the PREPARATION of two
reports. both of which are herewith
submitted to Congress. These reports
exhibit such transactions and schemes
connected with the constructor of the
aided reads and their management, and
suggest the invention of such devices
on the part of those having them in
charge, for the apparent purpose
of defeating any chance for the
governments reimbursement, that any
adjustment of plan of settlement
should be predicted upon the sub
stantial interests of government rather
than any foroearance or generosity
deserved by the companies. The wide
publication which bas already been
given to the substance of the Commits
nrta nj via ha nf
detailing in this communication the
facts found upon investigation.
The majority report, while con-
demning the methods adopted by those
who formerly had charge of the
Union Pacific Railroad, declares that
since its present management was in
sugurated in 1884, its affairs have been
fairly and prudently conducted, and
that the present administrati' n has
drvoied ITSELF honestly and Dteiligently
to the herculean task OF rescuing the
Union Pacific Railway from the insOl
v~ncy which seriously threatened it, the
inception of its )rk that it has
devoted itself by rigid economy. by in
telligent management and bv an appli
cation of every dollar of the earning
capacity Of the system to its i'm
provsment ard betterment, to
place that company on a sound
and enduring financial foundstion.'
The condition OF the present manage
ment OF the Union Pacific Company has
an important bearing upon its ability TO
comply with the terms of any settle
ment of its indebtedness which may be
offered by the government. The major
ity of the commission are in favor of an
extension of the time for the payment
of govern ment Indebtedness of these
companies upon certain conditions, but
the chairman OF the Commission, pre-
| senting minority report, recommends,
both on principle and policy, the iusti
| lution OF proceedings for the forfeiture
of the charters of the corpora ions, and
| the winding up OF thhir affairs. | hays
bean furnished with statement or ar
gument in deferse OF the transactions
connected with the construction Of the
Central Pacific road and. its branch
lines. from ghich it may not be amiss
to quote, for the purpose of showing
| how some of the. operations of Inc di-
rectors of. such road, strongly Con-
demned Blythe commissioners, are do
tended by tina directors themselves Al
! ter speS king OF contract for the con :
struetion OF cone OF sthess brs2GA lines
by the corporation called the Contract
/ and Finance Company, owned by
| certain directors of the Central Pacific
Railroad, this lsngu 4ge is used: 1T
may be said of this contract, as of many
Others that were let to diff
ferent construction companies in
which the directors of the Central Pacific
had been stockholders, that they Quilt
the road with money furnished by
themselves, and had the road for their
outlay. In other words, they paid to
the construction company bonds anG
stock of the railroads constructed apo
waited until such time as they could
develop sufficient business on the roaC
built, to induce the public to buy ths
bonds or stock. If the country through
which the road ran developed suffic en-
| BUSINESS, then the project was sue.
cess; if it. did not then the operation
was a loss. Those gentlemen took al
the responsibility and the loss occur
ring was necessarily theirs, and of RICH
the profit belonged to them. I, But it il
. said that they violated a we'll known
: rule of equity in dealing with them
selves. that they were trustees. and tha
they were representing both sidss IL,
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