The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1897-04-09
THE PACIFIC ROADS.
Bill to Adjust Their Debts to the
Government.

Washington, April S.-Senator Gear,
of Iowa, today made a report of the
bill to authorize a commission, con-
sisting of the secretaries of the treas
ury and the interior and the attorney
general, to adjust the debts of the
Pacific railroads to the government.
The report reviews, in detail, the finan-
cial condition of the roads and their
relations to the government and eX-
presses approval of the plan TO permit
the executive officers of the govern
ment with the APPROVAL of the govern
ment to make an adjustment with the
owners of the property. Referring to
the provisions of the bill that equal
facilities shall be afforded to all con-
Meeting lines it says:
1T has been frequently asserted that
the foreclosure proceedings pending in
respect to the Union Pacific properties
were likely TO culminate in the acqulsl-
ton of those properties in the interest
of one out of several lines reaching
the eastern terminus of the Union Pa
elf at or near Omaha.
This committee has thought that
whatever the results of foreclosure or
the first mortgage might be (and to
some extent this is perhaps beyond the
reach of congress, on account or the
priority conceded to those bonds in the
~.
might be made with the companies
under the authority of congress, these
provisions should be inserted in order
to make sure that the roads affected
by the settlement were kept open as
public highways in the future for the
benefit of all present or future rail-
road connections"
Upon the foreclosure of the first
MORTGAGES the report holds the gov
N rights HXcPnI
for the transportation of troops, mails
and supplies guaranteed by the
original subsidy acts.
If no other considerations except the
guarantee of equal facilities to all
connecting roads were concerned the
committee holds that this would
Justify a settlement by a commission,
as these privileges could be acquired
as a result of the foreclosure of the
paramount first mortgages.
The committee considers that any
ACQUISITION of the roads by the gov
eminent would be disadvantageous,
and that a foreclosure of the govern
ment lien can be expected to result
only in the loss of a large part of the
debts of the government. The APP
of a committee would save
the government from being forced
from reluctantly commencing fore
closure proceedings for want of author
ity to make more advantageous set
tlement The bill, it is explained. deals
only with the subsidy bonds on the
Central Pacific to a point five miles
west of ogden, a distance of 1914
miles, and the Western Pacific from
San Jose to Sacramento. 123 miles, all
claims upon the Union and Kansas Pa
cific being now before the courts for
The first mortgage bonds
on the Central Pacific are S25, SS3,OOO;
Western Pacific, S970,0C0; subsidy
bonds: Central Pacific, $25, SS5, 40;
Western Pacific, $3.50. $50.
The companies are said to have fully
complied with the terms of the acts of
1862 and 1854 and the Thurman act,
but while their earnings have enabled
them to meet operating expenses and
interest on the first mortgage bonds,
thev have been unable to provide for
the debt to the government. The
roads themselves are held to be in
adequate for the liens upon them,
which amount to about 100000 a
mile