The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1900-06-09
PACIFIC RAILROAD DEBTS.
HOW THEY HAVE BEEN SETTLED
ny M'KINLEY ADMINISTER ALTON.
within Two Years Nearly All of the
vast Sans Given in Aid of the
Construction of Roads Has Been
Recovered in a Prompt Manner.

WASHINGTON. June s.-"The settle
Ynent OF the Pacific railroad Indebtedness
must be ranked as one OF the greatest
achievements OF President Mckinley
administration said Gen. Charles Dick,
member Of congress from the Nineteenth
district Of Ohio, and secretary Of the Re-
publican national committee. today.
''Ail efforts. either by congress or the
executive departments prior to 1887. were
Of little avail I'm protecting the govern
ments interests In these roads. In fact.
there we're grave doubts whether the gov
eminent would succeed in being reim-
bursed. even in part. the vast sum eN-
pended by the United States I'm aid Of
their construction But the government
has realized in cash or Its equivalent ,
within two years. the sum % sl24iZl6ll
out Of about s136, 90 600 that was due. and
more than half the money collected was
for accrued interest that has not been
paid.
''The discovery Of gold In California. the
rapid Increase in wealth and population In
the territory west Of the Rocky mountains,
and movement on the part OF the older
states TO establish closer connections dur
ing the civil war with those outlying com
munItiss led congress IN 1869 10 authorize
the construction Of a railroad to the Pa
cinc ocean The direct benefit 10 be de-
rived by the government was its use for
postal, military and other purposes, Tho
act Of July !, 1862. chartering the Union
Pacific Railroad Company. was not suf-
fciently liberal, aud therefore nothing
was accomplished under its provisions.
Though the Union Pacific Company was
organized no one was found who would
venture money in the construction OF tho
road
ION July 2. 1854. congress amended the
act OF 1869. by making provisions moro
favorable to tho companies. The act OF
1862 provided that the government should
have first mortgage on the property OF
the company while the act OF 1856. pro-
a1 tEasu toll hat 10 he - lie
government should issue In aid of the
construction OF the road, II should take
second mortgage. Two companies were
organized under the provisions OF the act
OF hf4, ana entered energetically upon the
work OF construction. Tho road was built
from the California end eastward by the
Central Pacific Railroad Company, and
from the California end westward TO the
common meeting point ct Ogden by the
Union Pacific Company
Their lines wero united May 10, 1869
anticipating by more than seven years
the time required by congress The Union
Pacific Company constructed LOLA miles
and the Central Pacific 7l3 miles The
road OF the latter company was subse-
quently extended 40 miles and tho lines OF
the two companies from the Missouri
age OF 1917 miles
Aid for the Roads.
TN aid OF these roads and connecting
branches. the United States Issued bonds
20 the amount OF 80. 623 5l2. Failing TO
be reimbursed for the interest paid on
these bonds II became necessary, In pro-
lection OF the interests Of the govern
ment. TO pass the net OF May T. 1873 known
ms the Thurman act This act provided
thar the whole amount OF compensation
whicn might from time TO time be due
TO the railroad companies for services
rendered the government should he retain
ed by the government. one half to b. an
piled to the liquidation of the interest
~ Ifpit
upon the bonds issued 10 each OF th,.
companies. the other half to he turned
into sinking fund But II soon became
apparent that with the approaching ma
turity OF bonds issued In aid OF the roads
the provisions OF thu Thurman act were
not adequate TO the protection Of the gov
ernments interests. Efforts were per.
sistedly made looking to a settlement OF
this vaA, Indebtedness, but without sue
cess 10 recently al tho Fifty fourth con-
rresS an attempt was made to pass a bill
20 refund the debts OF the Pacific rail
rond companies but II was defeated in
yeas. ~
''on January 7. 1897" continued Cen
DICK, the day following tho defeat ~
the funding bin. the attorney general was
Informed by tho president that default had
occurred In the payment OF the linton Pa
cthc aud the Kansas Pacific tndah,aS
ness 20 IN" government. and he was dl-
feolcd 10 make arrangements TO secure
rs Tar as practicable. tho payment of their
Indebtedness. An agreement was entered
into hstwecu the government and The 70
organization committee OF the I'nfon Pa
cihc railroad. by which the cnmrnit,c.
guaranteed. should the government IN
aet,Ahe 70 enforce It's lien 10y sale. a min
imnm hid for the Union and Kansas ia.
enc Hines that would produce TO tho gov
"Fhmeut over aud above any uriot limos
ana charges upon the railroads and sink
ING fund, the net sum OF So T5l 0s9 ~ In
performance ~ this agreement the Md
waa guaranteed hy a deposit Of q -, ~