New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1907-03-22
ERIE WORK STOPPED.
UTILITIES BILL FEARED.
Road DiscOntinues Construction of
Many Subsidiary Lines.

The executive committee Of the Erie Railroad
company 1t was officially announced yesterday,
mas decided to stop until further notice practically
GU 'hS new construction work which the Erie sys-
tenn has had under way for the last year in the
State or New York. The reasons for this change
OF pohcy' which will throw two thousand men out
u employment are explained in the following
statement issued by J. H. Maddy special repre-
sentative OF the company:
aefe are several reasons for this action TO Sc
T tt1e proper legal powers 1t has been necessary
proneT3v lte Raroad in the Rehabilitation OK t tiio
%IS oil new lines etc. by means Of subsidiary
within the last Two vIonl ;tiI b"en found that
there is iikeiboo oS rs ,diin, ~ the State OF
New York being entirely reversed with respect to
other burdensomo legislation is proposed.
l., H! 1re 1--WE important lines being construct
line t to Hunts on the Buffalo division BY means
expenditure is being made for a low grade line
between Port Jervis and NewbIrg Junction.. on
road Company. These companies were organized
IN the state OF New York. ard work has been I'M
dtGons these companies find themselves unable 70
the completion of lie work mt this time.
II is expected to continue the work on the Bergen
at jersey City account of the pressing necessity
road. in Warren COUNT PENN. and various smaller
contracts in Ohio and New Jersey which are near
ing completion.
About 100000 has already been expended on the
construction work in this state, the carrying of
which through to completion would involve the ex-
penditure of about 100000 in addition Section
of the present General Railroad law OF New York
State expressly authorizes the formation Of sep
arate companies for constructing cut-ohs, extern
sions aud carrying out other improvements, and
II Is under this section the Erie has organized
the subsidiary companies referred to in Mr.. Mad
dys statement. the Genesee River Railroad Com
pany and the Erie & Jersey Railroad Company.
The Public Utilities bill now unuder considera-
a. RI ar
qure any part the capital stock OF another road
without the consent of the commissioners created
under the provisions Of that measure. and also pro-
vdes that no stock corporation shall purchase or
acquire than 10 per cent OF the capital stock
OF another company.
The subsidiary companies incorporated in this
state in the interest OF the Erie Railroad Company
for the express purpose OF carrying out the I'M
provement plans mentioned have as vet issued only
Fart Of their authorized stock, II is understood
and If the Public Utilities bill shall become law
the Erie may be unable TO hold enough OF the total
stock TO give II control them But the CHIEF
reason for the decision OF the Erie 70 suspend the
Improvement work IN New York state IS SAID 10
be the dsincination of the bankers to take securi-
ties Of the subsidiary companies, and thus provide
funds for prosecuting the construction plans, the
bankers having been advised by counsel that the
bonds would not be a safe investment until the
measure now before the Legislature should nave
been either enacted into law or rejected anu II
made q law, until us erect shouiu y AN'' -
The meeting at which tho executive committees
,-oted 70 suspend the construction work IN TINS
state was reid in the absence OF President inner
,,-ood WIN Is IN the West: and It was reported IN
wall Street that difference OF opinion existed IN
the board regarding the general policy OF extern
sive Improvement OF the system. 20 whicb MI
Underwood has been committed, and that the eX-
ecutive committees action was virtually an eN-
rassion Of disapproval Of that policy. T. IL Harrl-
man. who is one Of the Erie directors. when asked
about this point, said;
There IS no dlssenson IN the board rs far pT a.
know Personally I not dissatisfied Win / kesi-
denf TTnderwoods policy; quite the opposite Inc
ection Of the executive committee was due 10 penu-
In Iegfslation The directors unwilling To face
tbe Utility Of payirg out the stockhqlders
money on property as 70 the capacity OF me STOCK
A. 9ba ONCE Of !. P Morgan s. Co. st also
sa,d that as far as was known, there was no dis
satisfaction with President Underwoods policy in
tina board.