The herald., 1894-10-09
PACIFIC RAILWAYS HISTORY
Their Construction and Finan-
cial Management.
Compiled From the U. S. Pacific
Railway Commissioners Report.
"A Showing of the Aid the Government
Gave tho Railway Building
and tho Action of the
Companies.

Mr. George S. Patton has published
history of the construction and financial
management OF the Pacific railroads.
compiled by Hon. Geo. S. Patton from
the reports OF the United States Pacific
Railway commission appointed by Pres'
ident Cleveland under the act OF con-
'gress of March 3, 1887 The history will
be published in the HERALD, the follow.
ing being the frat installment:
In the year 1887, an act of congress
was passed "suthorizing an investiga-
tion Of the books, accounts and methods
of railroads which nave received aid
from the United States" and providing
among other things for the appointment
by the president OF a commission for
that purpose. The commissioners ap-
pointed were the Hon. Robert Z. Patti
son of Pennsylvania, the Hon. Ellery
Anderson OF New York. and the Hon.
David 7. Litter of New York, gentle.
men--as shown by their reports-emi~
nently qualified for the performance OF
the difficult and responsible duties
assigned to them. By these gentlemen,
and an able corps OF expert accountants
and railroad men, prOtracted and ex-
haustive investigation was made; and
their reports made in accordance there
with may be regarded as constituting
the only complete and authentic history
OF the nond-aided railroad companies.
These reports consist of a majority
report by Messra. Anderson and Littler,
and minority report by Governor Pat
tison. The former recommends, in
substance, an extension of the time OF
payment, upon certain conditions, for
the term Of 30 years; the latter, suit
ior the forfeiture of the charters of the
companies, and winding up OF their
affairs. Neither scheme was adopted
by congress, and the whole matter fell
into abeyance until the introduction OF
the bill now pending in congress-, which
in effect provides for an extension OF
time for payment for so years, and q
reduction of the interest to per cent.
The magnitude of the interests in-
volved In this bill-as affecting the pub
lilo generally and more especially the
people of the transmississippi states
renders it perhaps the most vitality inn
portant measure-at least to the latter
that congress has ever had to pass
upon; and on this account the reports
OF the commissioners have come, at the
present time. to have peculiar value.
as being the only recorder at least the
only accessible record-of the facts by
which the juetioe and expediency of the
proposed bill are to be judged. Un-
fortunately a few copies only of the
report remain extant; but the following
compilation, it is believed, will present
fully all that ia material to the questions
pending between the government and
the companies,
The majority and the minority re-
ports of the commission. though differ
ing in the methods of adjustment pro-
posed and in arrangement, in otner re-
spects agree, substantially, with each
other, and contain much the same mat
ter. To avoid repetition, the two re-
ports will be consolidated in this COM
pilation land the subjects treated OF will
be distributed in the following order:
Cd History OF the construction and
of the subsequent financial management
of the Pacific railroads.
(2) Statement of their indebtedness
to the United States, and OF their pres
ent financial condition.
(3) The legalremedies of the govern
ment for the recovery of the debt.
NATURE AND AMOUNT OF GOVERNMENT AID.
The Pacific railroad companies that
have received aid from the government
as they now exist-consist of:
The Central Pacific Railroad company.
with which the Western Pacific Railroad
company has been consolidated, and its
several branches.
The Union Pacific Rrailroad company,
with which the Kansas Pacific Railroad
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road company have been consolidated,
and its several branches, and
The Central Branch Union Pacific and
the Sioux City and Pacific Railroad COM
panies which, being of comparatively
little Importance, will not require much
of our attention.
All these roads were constructed un-
der the act OF congress OF July l, 1862
(12 Stat, 4S9), and the amendatory act
of July 2, 1864 (l3 Stat, 1850.
By the act OF 1862, there was granted
to each OF the bond aided companies, in
aid OF construction, the right of way and
10 sectons of public lands for each mile
OF completed road and 1t was also pro-
vided that there should be issued TO the
companies for each section OF 40 miles of
finished road, bonds of the United States
of $1,000 each, payable 80 years from
date, with interest at per cent, pay
able semi-annually, to the amount of
$l6,O 900 per mile. These bonds, by the
provisions of the bill, were, ipso facto,
upon their delivery, TO constitute
a fret mortgage upon the
roads and equipment OF the
companies to secure the payment to the
United States, at maturity, of the prin-
cipal OF the bonds, and also OF the
amounts paid by the government as in
terest thereon and the earnings of the
roads from the government, for tele.
graph aud transportation services, and
also, after completion, 5 per cent of the
net earnings were to be applied to the
payment OF the indebtedness of the
companies TO the government
By the act OF 1884, this act was amend
ed go ss to require only one-hslf of the
compensation earned by the roads from
the government to be applied TO the
debt; and elso, so as to permit the COM
panies to issue first mortgage bonds on
their roads and equipment equal in
amount to the bonds received from this
government, and constituting prior
lien thereto.
The aggregate amount OF pecuniary
aid received by the Pacific railroad COM
panies under these acts is stated by Gov
ernor Pattison, in his minority report, to
be $447 ,729, 470.54, as will appear from
the following table, compiled from the
tables given by him: &
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