Los Angeles daily herald., 1890-02-17
THE PACIFIC ROADS.
A Plan Proposed for Their
Refundment.
ABLE TO PAY THEIR DEBTS
The Union Pacific to be Granted
Fifty Years. Time and the
Central Seventy-Five.

after many hearings, thorough investiga-
ton and careful consideration, have
finally accepted the reports of Senator
Frye on the Union Pacific and Senator
Davis on the Central Pacific, and agreed
upon bill providing for refunding their
debts, The report on the Union Pacific
reaches the following conclusions:
One-That the policy of building or
acquiring branch lines was wise, and
through the period covered by their in-
qniry, honestly and economically carried
out.
Sscond-That the main line has de-
rived an immense advantage from the
branches, and there is no foundation for
the charge that the latter have received
undue benefit at the expense of the main
line.
Third-That the building of the Ore.
gon Short Line, and the subsequent &C.
quirement of the Oregon Railway and
Navigation Company's lines, instead of
being menace to the interests OF the
Government, have proved a decided ad-
vantage.
Fourth-That the recent consolidation
of several branches under the name of
the Oregon Short Line and Utah North
ern Railway Company simplifes the sys.
tenn of the Union Pacific, makes posi-
BILE a more effective and economical
management and in no regard evidences
any purpose of evading obligations to the
Government.
Fifth-That the branches, instead of
being maintained at the expense OF the
main line, contribute at least So 100000
year to the treasury of the company.
Sixth-That improvements have been
for several years past greater on the
main line than on the branches, some
of them being very important and expen-
sive.
Seventh-That there is no evidence of
any purpose on the part of the company
to surrender that portion of their road
over which the Government has statu-
tory lien on the contrary, there is every
reason tending to satisfy any candid per.
son that no such purpose exists.
Eighth-That this is capable, we'll
managed road, abundantly able to pay
its debts, requiring only, like every other
railroad, time in which to pay.
Ninth-That the present management
is honestly trying to effect an adjustment
with the Government.
Tenth-That the interests of the Gov
eminent and the railway company will
be promoted by settlement, and that
one has been made, under Which every
dollar owing to the Government, with
interest, will be paid.
1t ends: "The present security is
statutory lien on the road, commenc-
ing three miles west of the Missouri
river and extending to point five miles
west of Ogden; and on the other road,
commencing half mile west of Kansas
city and extending to a point 1893 miles
westerly-commencin in prairie and
ending in one. 1t is not enough to pro-
tect the Government debt, if it shall not
be adjusted until it becomes, due by fifty
million dollars, while under the bill to
be reported the security obtained will be
twice the Government debt in value, and
payment according to the terms of the
bill is absolutely certain"
The report on the Central Pacific finds
that the United States has for security 8
at point five miles west of Ogden and
facilities at either end, made subject to
|
amount to the original Indebtedness of
this company to the United States; that
that portion of the road from Ogden to
the western slope of the Sierra Madres
is practically only bridge without any
local business Of any amount; that the
lines reaching from the main line into
Nevada do not now pay actual expenses
that the present security of the United
| tu ic ont lu
adequate; that the foreclosure of the
first mortgage would substantially ex.
haust, in the satisfaction thereof, the
entire property, and that it would be in.
expedient for the United States to re.
deem from said first mortgage or tc
beCome owner of the property through
redemption and foreclosure.
The report finds that it is expedient
necessary and practicable to adjust and
further secure the Indebtedness to the
United States upon extended time at q
reduced rate of interest, within the abil.
lty of the company to pay, upon such
terms as advance the development OF
the country through which said roads
pass, and afford the inhabitants thereof
reasonable rates Of transportation for
passengers and freight.
From the report it appears that the
Central Pacific has not the ability to
pay at all equal to that of the Union Pa.
cifc, but under the terms of the bill to
be reported can make final and full pay
ment reasonably certain.
The bill agreed upon includes within
its provisions the Union Pacific Railroad
Company, the Kansas Pacific Railway
Company, and the central branch of the
Union Pacific Railroad Company, consol-
idated under the name of the Union Pa.
cific Railway Company and the Central
Pacific Railroad Company, successor to
the Central Pacific Railroad of California
and the Western Pacific Railroad Com
pany.
1t provides for funding the present
worth of the indebtedness of the Union
Pacific Railway Company, on July LIST,
1890, and for the payment to the United
States of that amount, with three per
cent. interest, payable semi-annually !;
also portion of the principal semj-an-
nually, 80 that the entire debt will be
paid In fifty years.
Itrequires that the Union Pacific railway
shall give mortgage on all it's property.
of every name and description, real.
mixed and personal, and also preserves
to the United States list of the present
statutory lien. In the event of the fail
ure of said company to accept the pro.
visions of the act, there shall be carried
to the credit of the sinking fund one-half
| 30 H. no,,Danoafioy fo. co.xx:a