The Brattleboro daily reformer. (Brattleboro, Vt.) 1913-1955, 1913-07-09

$96,0O0,000 for betterments and equip
ment, making a total of 1880 900
devoted to its railroad property.
FThis would leave the report
points out, f'the sum of 1904. 600. 900
which in nine years had been expended
in operations outside its railroad
sphere. - To the methods of investing
that sum, the report devotes elaborate
attention Various transactions are TAX
en- up, one by one, and analysed.
In its acquisition of the Rhode Is
land trolley lines, the methods pursued,
| Commissioner Prouty suggests, .afford
Ian instructive object-lesson in the
realm of what is sometimes termed
i high finance. After passing through
the hands of two or three corporations,
the trolley lines were acquired by the
New Haven at |'infated'' prices.
Representatives of the New Haven
company the report says, ""instissed
that this company had not wateTed
stock of the Rhode Island company.
and this, strickly speaking, is true. The
Improvement company turned III the
water and the New Haven company
converted that water into wine. In
whatever aspect the transaction is
viewed, the New Haven company gave
$13, 100000 for nothing 1t was shown
that the trolleys cost the New Haven
iup to date about $24 700, 900 and have
been valued at something more than
one quarter of that amount.
We are not concerned saws the
report, ''with the amount lost, hut
rather with the character of the trans
action. The inevitable query is: What
was the motive behind this transaction
and who made the profit? That ques-
ton, in the very nature of such trans
actions, never can be satisfactorily an
swered. =
| The New Haven, Westchester & B1s-
, ton railway, the evidence disclosed. a
four-track electric road extending from
White Plains, y. y, TO terminus at
Harlem River. a distance of 20 miles.
, WAS built and is owned by the New Ha-
. ven. When it was opened for business
{ in 1912 it had cost the New Haven
} about $34,000,o 900, $4,000, 900 in OK
cess of the value of the property on
the New Haven 5 own showing
Again the question arises, sue-
2 gests Commissioner Prouty. 8. What
r has become of this s12. 600 ,a0a' So far
as the records 90 this money has van
/ ished into thin air.
1 The property is expected in time to
4 earn its fixed charges and perhaps be
: profitable. The report points out that
r 'all this IN no respect alters the duaE
Iity of the transactions. In any ASPECT
Z Of the matter the patrons of these
2 lines are required to paw upon an in
: vestmcnt which never has been made,
e and thereby subjected to a perpetual
unjust exaction.
The acquisition by the New Haven
c OF trolley lines in Massachusetts is re-
7 viewed at length. Particular reference
: IS made to the operations of J. L. Bill
I ard in connection with the purcha SC
! by the New Haven of Boston / Maine
t stock. The conclusion Of the report i
that the New Haven company gave
G away to Billiard and his associates
y about $3,000,000 of the property Of the
5 New Haven.
r These transactions, says the re
port ''are probably extreme, but BY
e no means solitary The other outside
ventures of the New Haven company
4 have been almost uniformly prosecuted
e at loss. This is true OF its troIlay
/ acquisitions in Connecticut and Massa
5 chusetts, as well as Rhode Island anC
: New York; it is true of its purchase OF
railroad stocks and steamship lines. Mr.
= Mellen entered into an elaborate de
y tense of his management Of this prop
E, erty, and he was able to point to ba
r a single instance ii which up to tn,
d present time, the venture had heeI
W profitable. He had purchased the Cen
l. trail Railroad of New England, and thu
" profit upon that transaction had beer
& handsome one.
IS The transactions of President Mellel
IS IN giving his personal notes to his owl
t. company for stock are discussed a
Sc length by Commissioner Proutv.
If 8 His statement was that the amour
had been used in campaign expendi
lr lures during the summer and fall o
rs 1904, that this had been done BY direc
u ton of his directors, and that the
lie had subsequently ratified his act. Thes
Y, campaign contributions call for u
le comment from us. The act of the Ney
S, Haven was not peculiar to that cor
V pany at that time. What may be ope
to criticism is the lax way in whic
he this matter was handled between an al
ID fccr of this company and its director.
er The special account shows a pavmcn
II to Mr.. Mellen of $4,000 in cash whic
" he passed over to the Republican ms
H. tional campaign, committee. 1t show
er 4 second payment to Mr. BucklaD(
now the vice-president of the con
in Ipany, of $4,000, which was turned owe
he to the Republican state committee z
is Rhode Island. -
In The investigation disclosed that sue
o. stock transactions extended over a co,
lie SIDERABLE period and from time to tim
ed Mellen was given various large sur
ne for various purposes unstated on ii
ir books of the company He explaine
es that the amounts he received were f,
1T campaign contributions and for 9th,
o. expenses, including one item of $50
le- 600 spent in connection with "certai
IRIS leases Of dock property in New You