The morning news. [volume] (Savannah, Ga.) 1887-1900, 1899-12-17

r. 50. John Opposes the bond hin
Pending in the LcgisIRture

r. -. Johh imposes the bOnd hiil
Pending in the Legislature.
Vice President and General Manager E.
ST. John of the Seaboard Air Line, who
Will have charge of The consolidated inter
ests of the syndicate owning that prop
erty, has written letter to the Atlanta
Journal In protest against the bill that
has passed the Georgia Senate known as
an act TO limit the power of railroad com
panies to issue bonds. Mr. St. John said
the bill should accurately be termed IAN
act 10 prevent competition by other lines,
by creating new systems. and to prevent
the building of new railroads In this state. ''
Mr.. ST. John says in part
This bill provides that hereafter no
railroad company shall have power TO Is
sue its bonds secured by deed, mortgage
OF other lien moi heretofore publicly re-
corded or any kind of bond whatsoever
covering any Of its capital stock or any
of its property located in this state. unless
said issue of bonds shall he approved by
me Railroad Commissioners OF this state
1t requires all corporations desiring to
issue bonds or make a mortgage securing
the same, 10 file an application with the
Railroad Commissioners setting forth the
amount TO be issued, the purpose of the
issue, the property, and allows interested
parties to he heard In opposition.
No such issue shall be approved by the
commission unless IL appears that il Is
necessary for the legitimate purpose Of
the corporation, and none OF said bonds
snail be used 10 pay for any railroad prop
erty bought, except al the fair and rea-
sonabe value Of such property The COM
pany shall not apply the proceeds of such
ponds TO any purpose not specified IN the
certiucate of the commission, and the SUI
d af tba
where the company has an Office can on
the Application Of any stockholder bond
hohdef or creditor, issue an injunction and
plunge the company into litigation II
also provides that the capital stock of any
railroad company formed by consolidation
OF merged in any manner shall not ex-
ceed the capital stock OF the corporations
so consolidated or merged and prohibits
me issuance of any bond or other evidence
OF debt as the consideration for any such
consolidation, merge or purchase.
Whatver object the introducer Of this
ACT may nave had, it's effect is manifest
Inc Seaboard Air Line the Georgia and
Alabama and the Florida Central and Pc
ninsular are about to be consolidated, and
new securities are about to be issued on
the consolidated properties. Their financial
arrangements have been based on the pres
ent state of the law. Parts of each of
these properties lie in Georgia The pas
A.
ton of these properties.
Another railway, by its purchases.
mas secured almost a monopoly of the bus
mess OF this state. II has the different
railroads IN the state separated. The Sea-
board Air Line combination introduces al
once into this state actiyS, vigorous eff
cient competition. This bill defeats that
competition and perpetuates the existing
railway monopolies. You will note that IL
permits any corporation 10 still issue adj
ditional bonds provided the mortgage Sc
curing the same has already been public
ly recorded.
Another railway has now on record in
thls and other counties mortgage Sc
curing $4,000, 600 of bonds of which only
a small part has been issued and the resi-
are to be issued as that company deter.
mines. Al present only about $50 900. COS
nave been issued, but as the mortgage has
heretofore been recorded that company
under this act. can continue issuing It's
bonds up to the S12O0C0000 without having
10 eau on the Railroad Commission. or
consult anybody else.
The Seaboard Air Line not having pub
licly recorded the mortgage under which
1t proposes to issue its new securities will
be prohibited from getting out any hnan-
cial plan for which il cannot secure The
Endorsement Of the State Railroad Com
mission, not as financial plan, but under
the restrictions of this act Even the
Railroad Commission cannot permit the
issue of these bonds, however advisable
they may think them, unless the amount
Is restricted according TO the terms OF this
act.
The boast has been made by the oppo-
nents of the Seaboard Air Line in New
York, since this bill passed the Senate.
that the Geargia Legislature would pre-
vent the reorganization of the Seaboard
Air Line System.
ut is a great mistake If any man thinks
this Is only a fight between the Southern
and the Seaboard. II is far more. 1t Is a
fight between The Southern and the peo-
pie. If the Southern defeats the Seaboard
System, it defeats tn only efficient COM
petitor now left in the state
''The people have no real interest In the
SeabOard system, except as a means to
secure competition. AS such means, they
have the greatest interest in preventing
the Southern from throttlng 1t and de-
feating competition.
The Seaboard Air Line has been per-
sistently fought by competitors from its
inception. The Southern Railway and
Steamship Association endeavored to shut
IL out from doing business with other
lines and forced 1t into litigation to main
tain its rights Next a boycott was
brought on against it. Then the Itiga-
tions in Georgia, South Carolina and Vir-
Bluids kHoWH as the Idle WhI cases,
were instigated against II. Presumably the
allies Of our competitors endeavored to buy
up our capital stock, and plunged us into
a series Of litigations. When now II sees
the Seaboard Air Line about TO form a
system which can effectively compete
with it, It is endeavoring through the Leg
islature of Georgia to pass an act which
will effectually prevent this consolidation
although such consolidation Is Of roads
which are in every way non-cOmDetitiVe
and which does, not infringe any provis-