New-York tribune., 1906-04-27
BELMONT NOT WORRIED.
LET COURTS DECIDE" "
interborough Head Giues Reasons
for Not Paying on Sinking Fund.

August Belmont president OF the Interborough
company. said yesterday that while the subway
system o>rned 3e4 per cent net for the fiscal year
ended octc-er 81 last, the earnings this year are
per cent or better. and Mr.. Belmont intimated
tlat there could not be any controversy over the
per cent payment 10 the sinking fund from this
iifhe on When Mr.. Belmont asked yesterday
a. make statement with reference 10 the con-
tention Of the Controller that the interest rental
BONDS should not be charged to operating expenses.
he said:
Ills ~ IS almost waste OF time To discuss the point
way to arrive at a clear understanding of doubtful
s phases 2r The contract is TO leave them 10 the
features are vague, We took the contract as we
clear that the a a TeaGIng OF u tbs innr
fund not to be paid By the tenant until his
gesOns with reference to water in the Inter6o7
oush. There isn't a dollar Of water in it. More
over, the per cent controversy cannot continue
than per cent at this time. and improving
The first year of operation included many ex-
cut down our traffic and involved extra dsburse-
fund payment will be paid on the earnings this
if the earnings warranted it.
The Controller. under the contract, always has
access 10 the books of the Interborough company,
and there Is nothing in connection with our book
keeping that We wish TO conceal
George ". Wickersham. counsel the Inter
borough Rapid Transit Company. made the follow
ing statement
good deal Of misapprehension seems TO exist
in the public mind with respect to the question
Rapid Transit Company with respect 10 payment
The Rapid Transit act and the Mcdonald con-
tract provided S thar during the first five years after
tractor should not be obliged to make the sinking
fund payment Of l per cent on the amount OF
Unless the contractor should earn a greater proft
upon his net capital invested in the enterprise than
The unreasonabIeness of the position assumed by
the city through the Finance Department may De
ent Of expenses of operating in any the bal
operation OF the road amounted TO just enough TO
pay the city the fixed rental equal to interest on
ton OF the road on the Controllers theory noiwith
standing that fact, the operating company would
though that deprived II OF all profit on the capital
w6 had sH or nd SosS & 2 rdm i'S oaf sf
sources A mere statement Of this proposition -
city in order to induce contractor TO undertake
the construction and operation of the subway.
ment should not be made until the contractor had
this stipulation meant to confer beneht upon the
contractor.
The statement furnished Controller Metz by Mr..
Belmont prove that the Interborough company is
liable for the per cent payment 10 the sink
ing fund for the year ended last October does not
seem 10 harmonize in spirit with the statement
made 70 the State Railroad Commissioners The
greatest discrepancy is IN the item covering the
cost TO the InterbOrough company Of the operating
lease obtained from John B. Mcdonald. MI Bel
rnont's statement 10 the Controller the
OF the lease Sl2lOOOoO while the item in the
ruent 10 the State Railroad Commission which
seems TO cover the lease is S2.7577N. This is a
difference Of more than 100000. The figures fur
nished 70 Controller Metz arc as follows:
CAPITAL stock 20 acquire subway s12 100 oo
Cost l,32l-2 -2sS
0f subway equipment r......... S26IeSl'
Total capital investment s36 0a- l52
Gross receipts YEAR October - 1905. So as
Operating expresses period 27lG So
c7-,s. i-,or,. ..................... S. 563 5sa
Less renta interest l24s, 453
Vet income s1s14osO
The figures sent 70 the state Railroad Commits
sion cover the eight months between October So
1904 and June g. 1875, and follows.
Cross ea7ri7E- ........... 81 6ae O7s 2s
I<ss operating expenses $50 44T -
Net earnings e-or1 operation ....-.. Sl.7sS $50 ~
Income from other IS1 IS u
Gross earnings from all sources sls7olIa %
Interest on debt. ...........-.. S623.6a 81
raxss ..........-.... ...-..- 15.9n0 49,
$40 $50 81
Ne. INCOME from ali s7u-re~.......... ,a3o52s 81
cost NJ lease Sa757.TSI -
Engineering and su,,eriateadeu14 subway cs6
Buildings and fixtures I'm -ibU 4-l1o3ib 90
equipment S.536. ia -
Inrer1st a5s86I So
M.saells-e1Is "bl3>l "a
Total s24.7ca ~ ;.
.5,-o,~-as Of yr,,,,fcinat cvvrare,i-, ,,os.er1a,