The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1903-04-17
BAD SHOWING FOR
METROPOLITAN
Counsel Claims False Reports
Of Finances Have Been
Made.

NEW YORK, April 16.-The COM
plete findings of Eugene "A. Philbin.
former district attorney of New York
county, as counsel for certain stock
holders of the Metropolitan Street
Railway company were made public
today, says the Evening Post. This
paragraph occurs:
1T is clear when the company's own
statements are analysed, that the In
terurban lease was calculated to pro-
vide and has actually provided many
millions of dollars in excess of the
honest requirements of the Metropolis
tan company"
The report finds that in 1898, -1S99
1900 and 1901 the Metropolitan COM
pany stated In its annual reports to
the state railroad commission that 1T
had expended for construction and
equipment a sum in cash exceeding
oy millions Of dollars the actual sum
in cash which is proved by the COM
pany'S general balance sheets to have
been so expended"
Mr.. Philbin says the company asked
for $23,000,000 to pay the unfunded
DEBT incurred in the purchase of stock
OF the Third Avenue company and to
defray the expense of extending the
electrical system to upwards of eighty
miles still operated with horse cars
and upon analysis the report said only
S14,7S1,694 was required for these two
purposes. The report says the COM
pany proposed to create a refunding
mo gage to secure an authorized is
sue of $65,000,000 of per cent 100
year refunding bonds, of which about
S54, 100000 was to be reserved to re-
tire and refund the twenty-seven is
sues Of existing bonds secured by
liens upon the various parts of the
Metropolitan system, excluding the
Third Avenue lines. The total of such
issues, Mr.. Philbin says. was exactly
S4S. 10000, and not about $54, 00O 000
The company in 1902 asked for $23,-
10000 part Of which was to be used In
paying the unfunded debt incurred in
the purchase of the Third Avenue line
AS matter Of fact" Mr.. Philbin says,
1T can be conclusively shown by the
company's sworn statement that the
Metropolitan on that date could not
have owed a single dollar Of unfunded
debt incurred in the purchase of Third
Avenue stock"
During 1898, 1900 and 1901, the re-
port says, the company reported ex-
pended for construction and equipment
$50, Alb, 421, while the actual expendi-
ture, according to the balance sheets,
was s25,355,572
On the subject of excessive valua-
ton of investments, Mr.. Philbin's re-
port says: THE total value of in
VeStmentS set out in the general bal,
ance sheet of June 80, 1901, was $21,-
S3,42S.36, and a year later $22565,-
g4l.76. These values are represented
by more than $12, 1000, 900 of Metropoli-
tan stock issued in 1907 fha
quirement of part of the stock and
bonds held at present as investments,
and by cash proceeds of other shares of
stock devoted to the purchase of such
investments.
The total of such stock issued is
about S2O,O0O,000 face value, on which
the company is paying Z per cent divi-
dendS, or at the rate Of 81 100000 a
year But the company's income from
these investments, as it's own annual
reports prove, is but about $780, 900 a
year. In other words, the company is
paying out annually $1,400,00G to re-
ce1Ve in return 100000.
mo one could possibly doubt, after
consideration of the these and other
pertinent facts bearing upon the sub
Ject, that the company's investment ac-
count has been manipulated to the adj
vantage of some person or persons, for
1t is clear that If the company is losing
over Sl,OOO,OO0 annually through these
investments, some one is necessarily
profiting to an equal extent"
Mr.. Philbin contends that entries in
the company's reports of 100000 in
1900 and $2.035, 900 in 1901 paid by
lesser companies" are pretended He
says none of the lesser companies was
obliged to pay the Metropolitan any
sum of cash on account of additions
and estimates Clearly indicate that the
Metropolitan company has claimed for
1902 an expenditure of cash for change
of motive power, exceeding by more
than 100000 the true cost thereof" !.