Passaic City record., 1895-07-27
APPROVES A PART.
Decision in Worcester and Nashua
Petition.

The Massachusetts railroad commissioners
have submitted their special report favoring
in modified measure the petitions of the
Worcester, Nashua & Rochester railroad for
a special issue of bonds. The commissioners
embody in the report the petitions upon
which they have given the subject their most
careful consideration.
''The report gives table of figures cover
ing the items of income and expenditure as
returned annually by the company for the
first nine years of the lease 1886 to 1894 in
elusive, so as to show the total income, the
interest charges and expenses paid, the act
ual net divisible income, the dividend act
ually paid, and the excess of dividend paid
Cor deficit) year by year, with the totals and
averages for the whole period. The figures
prove that the company has actually earned
an average annual dividend Of 4.j0 percent,
but has paid Gncluding the stock dividend
at its cash valuation on the company's books)
an average annual dividend of 6.56 percent.
The total excess of dividends paid over div
idends earned is found to be 1868, ,216,09.
The precise question under the first petit
tion, therefore, seems to be whether the
board should authorize by its approval an is
sue of 5000 900 of bonds, or any smaller is
sue, for the purpose of funding the compa-
pany's floating present debt and under the
second petition, whether the board should
approve an issue of bonds to the amount of
1926, 900, or to any less amount, as reasonably
requisite for the purposes, or either of them,
specified in the statute of 1890 above cited.
The facts and figures which have already
been adduced, furnish the basis for an answer
to both of these questions. For an increase
of the funded debt beyond the amount of
81, ,454 900 there has been, and there is now,
no justification or good excuse. Not a dol
lar has been added since the lease to the
property or resources of the company. Every
bond issued beyond the amount named repre-
sents not accumulation, but shrinkage; not
gains, but unearned dividends.
"lt Is not reasonably requisite, moreover,
that the company should issue bonds to fund
or refund its debt beyond the limit above pre-
scribed. The excess, which has been caused
by initiating the dividend, can and should be
paid by reducing the dividend. The claims
against the company have been liqutdated.
1t has an assured income. Hereafter it can
pay the interest on its debt and the small ex-
pense of maintaining its corporate organiza-
ton, can set apart annually for a term of
years at least one per cent as fund for the
gradual reduction of its debt, and can still
pay to its stockholders dividend which,
averaged with the dividends heretofore paid
under the lease, will be not less than five per
cent This, for a road which paid only three
per cent before the lease, is a reasonable, and
should be a satisfactory. return.
the second petition, and issue from time to
time of bonds to an amount which, with all
other bonds outstanding, shall not at any one
time exceed a total Of S1,454. .000 The
amount of outstanding bonds June /, 1895.
exclusive of the 1886, 900 for which approval
is now sought, appears to have been 81, ,404,-
000-leaving present margin of $50,000"
The report was signed by John E. Sanford
and William j. Dale, Jr, commissioners.