The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1892-11-22
The Railroad Commissioner Dis
cusses the Subject in His An
nual Report
They Should Be Given q Hun
dred Years In Which to
Pay Out.
He Deprecates the Idea of the Govern
ment Foreciosing and Taking Pos
session of the Lines.

WASHINGTON, Nov. 2l.--The special report
Of Hon. A. Taylor, commissioner of rail-
ways, relative to senate bill 751, providing
for the funding of the debt OF the Pacific
railroad. which he has made part Of his
annual report. has been received by Secre-
tary Noble. The report after recting the
history Of the bonds issued in aid
of the roads. closed thus: II am
of the opinion that, in view OF the
foregoing facts. it would be sound busi-
ness Judgment to settle with the rail-
road companies and extend their debts un-
der the provisions of the accompanying
bill rather than to foreclose the roads and
seek reimbursement for their cost to the
govern ument, either through their sale or
operation. l am sure that when the facts
of the situation are fully understood and
the alternatives, a settlement or foreclosure,
are squarely presented. as it must be, con-
gress will decide and the people approve the
deciaon that it is wise to make
settlement which promises to secure
the payment of all of the interest and part
OF the principal of tho debts each six
months from the date of settlement. rather
than to resort to foreclosure that involves
the additional investment of an amount
tQuHl W LAo oI}kAA1i oCbhs ~ ~ Vitoo W No
getting money out of bonded railroads
rather than putting more into them. BY
| the passage of this bill the government
hazards nothing, valves no existing
righ to, releases no present securities, in-
pairs no existing obligations.
! "If the railroads refuse to accept IL. or
accepting, neglect or refuse to comply with
it's provisions. the interests of the govern
ment will not be thereby in any way put in
peril If the railroad companies accept
| and discharge their obligations under 1t, as
| they agree to do then would 1T prove
happy solution of a vexed question. Care
| full study of all facts of the situation leads
me to the conclusion that the interests of
| the government and people along the lines
| of the bonded roads would be best pro-
| tected by such settlement as provided for
| in the amended bill submitted herewith
| The general purpose of the bill in ques-
tion 10 the extension OF the debt to lOO
| wears, with interest at two per cent.
and a portion of the principal to be paid at
the expiration of each six months during
that time, 80 that at the end of 100 yeara
the entire debt will have been extinguished.
The commissioner suggests several amend
rnents to the bill as 1t now stands, and
thinks with such amendments it would fully
protect the interests of the government and
secure the entire payment of all money.
| principal and interest, due from the bonded
roads. He does not believe that any meas
ure fixing shorter period of payment or
higher rate of interest would be accepted
by the railway companies. He thinks it
useless for the government to insist upon
terms of settlement that the railroad COM
ranies will not aRree to. and folly for the
companies to agree to conditions not war
ranted by their present financial condition
or future prospects. No advantage can ao-
crue to either party by their imposing, or
the other agreeing to, conditions that will not
or cannot be complied with. The railroad
companies should be made to pay as rapidly
as they can reasonably be expected to earn
money to pay with, and the rate of interest
fixed should be equal with the rate the gov
ernment Ia compelled to pay on its obliga-
tions. All present security should be held
and such further security required to be
given as the companies have ii in their
rover to give.
The commissioner combats the PROPOSE
ton that the government foreclose its mort
| cages and take possession of the roads as
wholly impraeticable, There was due the
United States on Dec 81 last, from the
Union Pacific $50. 500 45S; from the Central
Pacific $65, ,0S9. liz. The average date of
the maturity of the bonds is about July !,
1897. First mortgage bonds were issued.
which constitute a lien prior to that OF the
United States amounting to, Union Pacific,
S35, 762, 600: Central Pacific, S27, S53, 600.
These mature practically at the same dates
as the subsidy bonds. Among the amend
ments the commissioner suggests is one &c
change the method of computation in ascer.
tanning the present worth OF the debts, by
compounding interest for the time between
the settlement and the maturity of the sub
! sidy bonds semi annually, and make the
rate of interest two per cent from the start