The news & observer., 1897-02-06
Governors Message
On 99-Yeap Lease

lninetv-nine year lease was con
summated. is startling THAT
there appeared in this trans
action the indicia OF undue haste
and indefensible secrecy is well known
to the public, but not until now, so far aS
/ am aware. has it been alleged by re-
sponsible parties that the Trustees OF the
State actually attempted to make what
is substantially sale of its property at
a price less than was offered by responsi-
lhle bidders Ii this assertion be true,
then the transaction is not only void IN
lequity but fraudulent in law and morals.
liz this allegation be sustained by the
proofs the Courts of Equity would nul-
lify this ninety-nine year lease on the
ground OF paIpable and fragrant fraud.
ANY Director or other Trustee who
would sell or lease property belonging
10 his fiduciaries, waen he knew that he
could set a better price. would be rebua-
ed and removed and The transaction
itself vitiated by the Equity Courts,
! Your honorable bodies viii now sec
| that here is an offer for twenty year
lease which gives TO the State a net gain
| ave- the niuety-n.ne year lease OF about
oqc land. ed thousand dollars q year fo.
| twenty years, and to tie private Stoch
holders Il net gain of about thirty thou
sand dollars a year. On this bid the
State would get for twenty years four
per cent on two and one-half millions of
dollars, and this is a clear net gain over
what it viii get il this ninety mine year
lease is allowed TO stand. Under this of
fer OF the Seaboard System, the State
twould receive over and above what it
would get for twenty years under the
ninety-nine year lease about two mil
lion dollars, and at the end of the time
have all this property as its own. If we
advance in material development as we
hope and believe we will, at the end of
the twenty years the State will have
in this railroad a property that may be
of great value to its people III reducing
taxation or in augmenting the school
fund. There is good reason to believe
that the Seaboard System would pay not
only the ten per cent, but also the organi-
cation expenses and the taxes, State,
county and municipal of the North Caro-
lima Railroad. Indeed, what reason is
there to doubt that this bid Of ten per
cent may be greatly increased by those
who want this property, and by those
who not only want it but must have it
Dpt&uSh IL Is iuItcptUSdbAt III bAGtii3 AA3~
less they are allowed by our lawmakers
to become independent of it?
If the bin now pending before your
honorable bodies, entitled "An Act to
prescribe the terms upon which foreign
railroad corporations shall be allowed TO
operate railroads and transact business
within the State of North Carolina"
shall be enacted by you into law, not
only will this ten per cent be realized,
but in my opinion, more than that will
be obtained for your property. But this
cannot be accomplished if the bill is to
be amended by striking out any of its
important features. The provisions of
the bill as to requiring nonresident cor
porations to obtain a license after the
first day OF May, 1897, and denouncing
criminal penalties for its violation, are
essential for the States protection. Thls
license feature applies to the old lease
as well as to the new The lessees have
no right to complain of this action by the
State because they took the thirty year
lease with notice of the reserved right of
the State to exercise it's sovereign power
to prohibit them, as foreign corpora
ton, from operating a railroad in the
State. They never had lease from the
State or any contract with the State.
Their lease and their contract were with
the railroad company. The North Caro-
lima Railroad Company leased to them,
foreign corporation, and they were
permitted to take and did take the lease
under and by virtue of an unwritten law
which said to them "You are authorized
by the laws of Virginia to- take this
lease, and not by any statute of
North Carolina" North Carolina ad-
mits you here as q matter Of hospitality
and comfy This hospitality and comfy
she viii withdraw at her pleasure" The
provisions of the bill as to removals from
our courts are just and fair and neces-
sary to the enforcement of the rights of
the State. The striking out of any of the
bill will probably be disastrous
unless it be that which au-
thorizes the sale of the State stock. If
the General Assembly in its wisdom pre-
fers not to authorize the sale in any
event, that much can be stricken from
the bill without weakening or impair
ing the efficiency or force of its general
scheme That scheme is to make such
laws as are necessary to get for our
property what it is worth, My own
best judgment is that the stock should be
sold unless better terms may be had by
lease.
Objection is made that legislative ac-
ton in this matter will lead to expensive
litigation. / do not believe that the lit
igation would subject the State to seri-
Gus expense. | know no way to assert
rights or correct wrongs except by liti-
CATION.
1t is of the highest import that the
North Carolina Railroad from Green's
boro to Charlotte shall not be parallel
led until the State has disposed of its
stock by lease or sale. TO permit this
| is to seriously impair the value if it does
not throw away the property.
No one railroad or line or system
should be permitted to acquire by lease,
purchase or otherwise, any competitive
railroad or line or system. / earnest
| ly recommend that the measure relating
1 , ~ cRI 41.a