Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1914-10-06
RECEIVER REPORTS
ON PHONE STOCK
lnterstate's Debts 1927, o24, In
terest on First and Sec
ond Mortgages.
BONDED OBLIGATION Is
DECREASED TO $2,84o, $50
Six Subsidiary Companies Are
Shown to Be Operating in
Good Condition.
Special to the Evening Star.

special TO the evening star.
TRENTON, Oct. 6-James Kerney,
as receiver for Tie Interstate Tele-
rbcne Company, today filed pre-
liminary report in the coqft of Chan
Gerry showing that he has made a
personal examination of the property
of the company, which operates the
independent telephone service In
Trenton, Atlantic City, Bridgeton,
Millville, Vineland, Ocean City, Bor-
dentown. Mount Holly. Moorestown,
Salem, Port Norris and the adjacent
rural territory. The company also
phone Company, of Philadelphia, the
long-distance lines between Camden
and Atlantic City, and through East
ern Traffic Association operates over
all independent telephone lines in
Pennsylvania, New York and other
Eastern States
First and second mortgage bonds
of the Interstate Company, aggre-
eating 81, S49, $50, are outstanding and
there is past due in interest on these
bonds $685., 92377. Outside of the over
due bond interest the company has
no current debts. The interest on the
second mortgage bonds has never
been paid.
Altogether about $6,O0O,00O has at
various times been put into the
properties controlled by the Inter
state Company, but through reorgan-
izations and a previous receivership,
the bonded obligation has been re-
duced to the present figure of $2.S49,-
$50. The company has never made
provision for any reserve fund nor
set aside any moneys for replace
ment or depreciation of property as
required by the Public Utility Com
mission.
Biggest Asset In Atlantic City.
The most valuable property in the
system is that operating in Atlantic
City. That property is operated by
the Atlantic Coast Telephone Com
pany, a separate corporate existence
being maintained to comply with the
franchise provisions. The entire is
sue of 100000 of capital stock of the
Atlantic Coast Company, however, is
owned by the Interstate Company
and Mr.. Kerney has been made
treasurer of the company and his
counsel n director, in order that q
control of the corporations organiza-
ion may be in the receivers hands
Besides having purchased the entire
capital stock of the Atlantic Coast
Company, the Interstate Company
has advanced to that corporation
tending the plant and system in At
lantic City. All of the other subsi-
diary companies six in number, are
operated as q part of the Interstate
system, and the report of the re-
ceiver shows them to be in good OPP
Grating condition.
Owns Paterson Company.
In addition to the companies it
operates the Interstate Company also
owns the entire bond Issue and con-
troll of the capital stock of the Pat
erson, Passaic and Suburban Tele-
phone Company, for which a receiver
was named on August 20 at the in
stance of Mr. Kerney. The Pater-
son company was a large creditor
of the Interstate company, it is I'M
derstood and was being operated at
a loss Likewise the Interstate COM
pany owns the Elizabeth Telephone
Company, which is not being oper-
ated Three telephones are kept in
use in Elizabeth to keep the fran
chise alive, and the report shows that
the Interstate has an investment of
$4,000 in the Elizabeth property.
About ten miles of underground con-
duit were laid in Elizabeth. through
which no wires have ever been run.
All of the property of the Interstate
company including its ownership of
the stocks and bonds of the subsi-
diary companies has been mortgaged
to secure the issues of first and sec
ond bonds. The system has about
10000 telephones in service, and the
receiver sets forth that he is having
an expert appraisal made of the en-
tire property. The receivers pre-
liminary report also shows that the
exchanges at Salem and Moorestown
are approximately costing about 500
a month more each in actual operat-
ing cost than the receipts of the Of
fees, while at Vineland an even
worse situation is presented. The
franchise in Vineland fixes the rate
for service at $12 year for each tele-
phone, and according to the receivers
report it is estimated that it costs
SIS year to maintain each of these
phones. There are 900 telephones in
use in Vineland.