The times., 1898-07-19
THE NEW BALTIMORE & OHIO.
What 1t Wns When Receivers Cow
en- and Murray Took 1t and What
They Rave Now Made 1t
(Fron the New York Financi

o IdlTiy appreciate lDc pfcScHl
tion of the Baltimore and Ohio and the
work that has been carried on in the last
two years. it is necessary to recall the de-
plorable position into which the once
great property had gradually worked.
For many years under President John w.
Garrett regarded as exemplifying all that
was best in American railroading, thought
to possess almost unlimited financial re-
sources 1t was suddenly developed that
the company had been immensely over
loaded with properties of one kind and an
other which were eating up all the profits.
while debts had accumulated, and the i'm
menSe book surplus which had given
such an air OF financial strength to the
company proved to be mere bookkeep-
ing asset. The company was forced TO
call in outside financial assistance to tide
1t over Its troubles in 1888, and II that
work had been thoroughly done. and a
permanent capable management provided
the disasters which followed in another
few years would never have been eX-
perieneed. But Mr.. Spencer, who was
qualified to manage the property with
rare ability, remained at its head only a
year.
With his retirement the possibility of
the road maintaining its own IN the s,r
gle for traffic was gone. This was not
realized at the time, but when the per-
iod OF trial came in 1884 and 1895. the rot
ten condition which existed could no
longer be concealed. and bankruptcy was
the only resort. The financial statements
were found to have been Inaccurate and
the physical condition of the property
was exceedingly unfortunate. The policy
had been followed or extending the ss
tenn by adding varied assortment of
lines, of little or uncertain value to the
road, and mourning heavy obligations in
debt far in excess of the real benefit de-
rived through the leased lines. Little at
tention had been given to the roadbed or
equipment. and both were in deplorable
condition. The sidetracks were crowded
with condemned cars. trains were being
constantly wrecked. and got over the road
only af-er serious delays; the freight car
ried. although il was falling off in vol
ume enormously, was generally stalled
for days along the road. Passengers gen.
orally avoided the route
This was the condition of affairs which
brought about the receivership. A brave
attempt was made to avoid this. Mr.. ].
III. Cowen, long counsel of the company,
whose strength of character had i'm
pressed Itself on matters far outside the
companys affairs, was made president
First he secured the promise of assistance
from influential financial interests in New
York, and then turned to the enormous
task of building up the great property
which had been turned over to him. He
at once undertook TO secure the best rail-
road men available TO give their atten=
ton to the working out of his policy. He
selected Mr.. Oscar g. Murray. whose abil-
ity had been tested as traffic manager of
the Big Four and in other positions. and
turned over TO him the direct control of
the traffic and operating departments.
But investigation had shown the magni-
tude of the problem. and recourse was had
10 a receivership with Mr. Cowen and Mr..
Murray as receivers. They could thus
carry out their policy without the draw
backs otherwise necessary. They pro-
posed TO rehabilitate the property, to re-
gain the traffic that had been lost, and
10 carry out the improvements necessary
10 reduce the cost OF transportation This
required ample funds, capable manage
and time.
The funds were obtained through receiy-
ers certificates, which nave been issued
in the extraordinary amount of over $lG,-
10000. This has involved the bringing of
a new principle into railroad receiverships
and contests with powerful banking in
terests representing bondholders who saw
heaVy charges being constantly put ahead
OF their lines. Funds for needed improve
ments are generally provided al the time
of reorganization. In the Baltimore and
Ohio case they were provided before that
event, and the bondholders received their
interest always within the limit allowed
for default before foreclosure. until the
present year, when the time was ripe for
reorganiza tion. Certainly the result has
amply justified the receivers
With the court standing by them, be-
neying in their policy and ready to au-
thorize the raising of such money as was
needed, the receivers saw their way clear
10 so ahead. They first gathered about
them the ablest traffic and operating Off
GERS that were ayaila Bile No question or
wages ever interfered with securing
whoever seemed TO be the right men. The
ef1ect was seen in substantial and
steady increase of traffic. which was soon
crowding the tracks and being carried
easily and without those delays which
had previously been witnessed with less
volume of traffic. In the meantime the
mechanical department was busy over
hauling the equipment. and putting in
service cars and engines which had long
stood idle on the tracks. and the en-
gineers were preparing plans for all sorts
of improvements.
Only an incomplete summary of what has
been done in the way OF improvements
is now possible. The table given below
shows the extent of the work in the re-
pair and maintenance of track, on the
Eastern lines, during 1896 and 1891 The
work accomplished since June 80, 1897. of
course does not appear in these figures:
1896 1897
Miles of I'd, Sd & 4th track built IS S56
Miles new siding built. 230 GIT
Miles road ballasted ........... 449 43+4
Masonry built (cubic yards)... 1.36s 4,oi2
New bridges and culverts CNo.) 13 81
Bridges repaired and strength
ened ..---.-....-..... .........-. 5OI 503
Fencing built (ft) )............... 81 092 1882
Platforms bit. & renwd (sq.ft) .n.135 TS.G4S
Grading comp. for new I'd trk.. .12 l95 3S. ieG
IN Na limos Sf nf ba in ha
two years. 271 miles of track were ballast
ed, and over 200 miles of fencing built. In
1896 and 1897 $1,000 tons of S5-pound rails
were laid. and nearly 900 ties. With
the work done this year and now in prog
ress. practically the entire line between
Baltimore and Pittsburg vii have been
relaid with S5-pound rails, new ties put
in the track and the whole line stone bal
lasted. Besides all this work, costly work
has been done in reducing grades. taking
out says, eliminating curves, and in other
corrections of alignment. New yards and
terminals have been built at Brunswick
Cumberland and Pittsburg. and the ocean
terminals at Locust Point, Baltimore, and
St George, Staten Island. have been
greatly enlarged ahd modernized. With
its new yards and terminals this compa-
ny IS amply supplied with facilities TO
carry its traffic. and the heaviest freight
movement Is handled expeditiously. with
out blocking the tracks or delaying busi-
ness. It Is probably safe TO say that half
the present normal traffic could not have
been moved in the old days The improve
ments in maintenance OF way have been
paralleled by the reconstruction of the
rolling stock. About 175 locomotives OF
the heaviest type. and over 10000 freight
cars of 80 tons capacity and over have
been purchased by the receivers. Very lit
tie of this is additional equipment. Most
of it replaces light and worn-out engines.