The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1896-05-02

WASHINGTON, May 1.-Senator
Gear, chairman of the senate commit
tee on Pacific railroads, today submit
ted the report of the committee on the
question of refunding the government
debts of the Pacific roads. The COM
nlfttee appends a statement from the
treasury department showing what the
estimated debts of the roads to the
government will be ON the first of Jan
uary next.
The Union Pacific and Kansas Pacific
debts, combined account, both princi-
pal and interest, are placed ait S53, 7l5,-
40S. and that of the Central Pacific at
So, 6S1, BIG Under the terms of this-b1H
the last payment on the Union Pacific
would be made on the first of January,
1862, and on the Central Pacific ON
January 1, 1876.
After discussing the propositions that
the government shall acquire and OPP
crate the Pacific roads or Zreclose the
government liens, is impracticable, the
report takes UP the question of
EXTENSION OF THE DEBT
in accordance with the bill agreed up
on in the COMMITTEE eof the two houses,
which bill it recommends, providing
an advisable course can be pursued
The report says the general purpose
of the government in substituting these
roads was TO promote the construction
of national highways and that the ad-
vantage which 1T was supposed at the
time the roads were organized would
insure to the country at large was I'M
der estimated than exaggerated. Atten-
ton is called to the fact that the con-
gressional statute on this subject i'm
poses on the roads
CERTAIN SPECIFIED DUTIES
that otherwise leave them free from
any exceptional relations to the gov
eminent. Congress at the time stud
iously refrained from direct construc-
ton. ownership or operation of these
highways.
'If this policy" says the report, was
wise ait the time when the consitruc-
ton of these railways was demanded
by public exigency, and when the rail-
way systems of the United States were
comparatively few and uneXtended,
the wisdom of the policy must be far
more obvious at the present day, when
the railways of the United States ag-
gregate over 10000 miles, and their
capitalization is $1O.OO0,OO0OOO. This
committee will not recommend any de-
parture from
THE SETTLED POLICY
of the government to keep itself free
from any connection with the owner
ship or operation OF railways. This
committee would not recommend, and
1T feels sure the good sense of the peo-
pie would not approve of any leg1sla-
ton looking to the control and opera
tin by the government of single sys-
TENS of railway in competition with
those controlled and operated by prl-
waite enterprise, or to the Inauguration
of a policy, the logical outcome OF
which must be the ultimate control
and operation by the government of
the great railway systems of the Uni
ted States.
In the opinion of this committee the
government had far better abandon its
entire interest in these properties than
take tine first step in a scheme so vast
and perilous
With reference to foreclosure, the
report says that it should not be I'M
dertaken without provision for the dis
charge of superior liens and the ac
ouisstion of other valuable properties
which must be acquired in order to
make possible
!. THE SUCCESSFUL OPERATION
of the aided parts of the system. 1t is
estimated that $9O,0O0,O00, exclusive of
the sinking fund, would be necessary
for this purpose. Such an appropr1a-
ton the report considers prepostcrous.
The advantages of the refundlnT
plan are set forth to be:
First-The security of the govern
ment debt is extended so as to cover
all the properties of the companies,
including the non-aided lines and ter
minal properties.
THE RESULT WILL BE
that the debt in the future will be Sc
cured upon complete railroad proper
ties instead of upon detached proper
ties substantially without terminals
and wholly dependent upon outside
properties for all that is most essential
to independent and self-supporting
railroad systems.
Second, that the railroad companies
shall pay fixed sums at prescribed
dates which shall reduce the debts to
the government as rapidly as possible
and in the meantime shall pay interest
at as high a rate as the earnings of the
property will suffice to pay upon all
the debt which shall from time to time
remain unpaid. In prescribing the
amounts to be paid, the amounts have
been fixed as large as could be expect
ed to be considering the earning ca
pacities of the roads. Attention is
called TO the fact that the Southern
Pacific company is made responsible
for the Central Pacific payments dur
ing
THE LIFE OF THE LEASE.
Under the arrangements for turning
in the government debt to the South
ern Pacific, about 100000 will be