Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1889-10-03
XAIhE DISPATCHES.
Senator Frye interviewed Regarding The
CnmlnS Trip Of The Senate Committee.
What Subjects Pertaining to the Pacific
Roads Will be Investigated.


Lk~isfok, Oct. q.
| ) nator Frye was interviewed today re-
gAr,ling the tour Of the Pacific railroads to
be taken by the the Senate committee who
will start Thursday Mr.. Frye said
The Central Pacific and Pacific Union rail
road companins received very expensive as
| sistance from the United States Governmen,
in the shape of lands aud bonds. By the
| terms OF the original act granting this subsidy
they were not compelled to repay it until
after the maturity Of the bonds, from s96
| to 1898. The indie b,edne.s of each of the
roads today would be about fifty million dol
lars. II allowed to run till due, it would
amount to about seventy millions each. The
United States has second mortgages on the
original Central Pacific and the original
Unioa Pacific. subject TO first mortgages of
fifty million dollars each. The United States
mortgage or statutory lien does not extend to
those portions Of the road built since they
were subsidized nor To their branches.
at is entirely clear that neither road can
| pay its debt at maturity. 1t is equally clear
that if the United States should foreclose
| and take possession by paying the first mort
cages on the two roads (sbout one hundred
million dollars in ALL they could not dispose
Of the properties for any more than enough
| To pay back the amount advanced for the
payment of these first mortgages
at is admitted generally it was recon-
| mended by President Cleveland in his last
| message, II is also recommended by the U .
s Pacific railroad commission and by the
commission recently appointed, and has been
| advised by the secretaries of the Interior and
of the United States, that an immediate set
tlement should be made, which should in-
| volve: first. the reduction Of interest from
| six to three per cent; second. = finding of
the present worth of the debt of the two
| roads to the United States, and third, an an
nual payment of a fixed sum out of the gross
earnings of both roads, which payment shall
in time discharge the whole debt-the two
roads securing this settlement by means of
a mortgage Of their whole property which
would in the case of the Central Pacific
about double the security now held by the
United States and in the case of the Union
Pacific about treble it.
The railroad shops at Omaha. for insta.ce
| worth millions of dollars). are not in the
mortgage. Neither is the great Omaha
| bridge. president Cleveland by q special
| message called the attention of Congress to
this subject and recommended that immedi-
house appointed committee to consider the
matter and report some plan. The senate
appointed special co ommittee of seven sem
stors. Frye chairman, for consideration of
the subject bill WAS reported in each
| house during the last session of Congress,
| for the settiemeLt of the Union Pacific s
debt, the committees being unanimous il,
their concin.ions. but these reports were
made too late for action. No conclusions
were reached ~ to the Central Pacific. The
Senate instructed its special committee to
make a thorough investigation of all the
| properties of the corporations. during vaca-
| ton. The members of the committee had
such engagements as prevented their taking
action early in the vacation, but our full
committee starts tomorrow morning to go
over both roads and all their branches.
| ~ sides the chairman, the committee
| consists of Senators Hiscock of New York,
Davis of Minnesota, Dawes of Msssachu-
sets Morgan of Alabama, Butler of South
| Carolina, and Hearst of California. The
trip will t. Ike about six weeks. Our exact
route cannot be determined till we arrive at
| Chicago, Saturday night
I'VE shall make extensive inquiries as to
the branches Of the Sc roads. Without the
branches IS feeders neither road could pay
its running expenses, to-day The question
| of the value of the branches to the main
line, is of great Importance to the govern
ment.
1T is rather singular fact that neither
road over which the United States has a
statutory lien. has terminus of any value.
One road begins and ends in the prairie and
Of the other, one end is in the prairie and the
| other end is so or 60 miles from San Fran
| CISCO
by the way. Senator, who pays the ex-
penses of these committee investigations2"
The United States pays all actual travel
ing expenses and for the subsistence of the
members of the committee and it's necessary
employees. IL any senator takes his family
he is obliged to pay. himself, all such add
| tional expenses"