Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1921-02-26

from 1917 to 1920 Of $54S.29O. 70.
amounting to 1876 increase The eotal
! municipal valuation in Maine for 1915
was $456.5s7.06s. Tho rate Of as
sessment for 1916 was practically "a
| mills. The total valuation ii, 1920
was s56S.6I7.715. The rate Of assess
ment for that year in round numbers
was 80 mills. A very marked increase
In ooth valuation and rate, making an
average increase of S79e. The Maine
Central Railroad complain that the
increase of 40 in their tax is unfair
and burdensome. and yet the increase
has been only about one-half the in
crease of the tax on the homes and
farms of Maine.
The Maine Central Railroad have
furnished numerous public statements
intimating that they were in a very
hazardous situation, even going so far
as to suggest that there might be
danger Of their being forced into the
| hands of the receiver. The press of
the State have elaborated these state
| ments and the effect of so much ag-
gressive propaganda together with the
fact that dividends had been passed on
both the common and the preferred
stock has quickened our common in
| terest in the affairs Of the Maine rail-
! ways.
! am deeply interested in Names
welfare ana l have the most kindly
/ Ieeilng for its transportation lines
ana the gentlemen who manage them.
believe, however, there is great dan
ger in the hypothetical and one-sided
method employed by the railroad
managers In presenting their case to
the public. In the case of the Maine
Central Railroad. this is our very
, own, nearly 75 per cent. of the COM
mon stockholders and almost 90 per
cent Of the preferred stockholders
are residents Of Maine. 1t is almost
1alr to say that the road is owned by
the widows and orphans of Maine.
Reading the daily press and receiving
no dividends. they are naturally APP
prehensive. I want to say to these
people; do not worry. your stock rep
resents intrinsic value in your own
road which you may safely estimate
at $3.50 per share
| what are the real facts in regard to
the Maine Central~Railroad? MIR. Nc
Donaid mas said many times that pre-
Vious to federal control the road had
been one of the staunchest and most
successful of roads, and he testified on
the moor of this house on the 9th dav
Oh this month as follows:
I'VE thought when they arrived at
the basis of making the federal com
pensation that we had a very salts
factory period of the three years and
our compensation was entirely salts
factory, gave us enough to take care
OF our fixed charges, rentals. diyi-
bends and o. very handsome surplus
in addition" '
/ And he testified further that in
addition to this standard return.
winch OF course for the two years
and two months would amount to six
and one-haf millions, there was still
due from the government approx
mately million three hundred thou
sand dollars for depreciation, etc.
under government control and q
, million. seven hundred thousand dol
lars under the guarantee since last
March. They complain of govern
ment control and yet in two years
and eight months they have received
and are to receive nearly ten million
dollars compensation for the rental of
their line. In addition to this they
have lately borrowed in round num-
bers a million, seven hundred thou
sand dollars of the federal govern
Inent on favorable terms at reason
able rates. The last published bal
ance sheet of the Maine Central
Railroad shows assets in excess of
liabilities of more than seven million
dollars. and this at a book or cost
value of forty million dollars and
carrying the common stock as a liza
bility at par. When you consider
! that this road was largely built and
equipped during normal times at nor
NAL expense, You can readily appre-
ciate the reason why the interstate
commerce commission place a tenta-
tive value upon the physical prop
erty of the Maine Central Railroad
far in exciss of the value carried on
its own books, this going far to prove
that the stock is not only worth its
book value of over $3.50 per share. but
, II the road can be assured of virile
and efficient management, I honestly
DSiicNc TIC StOCk Will later nave a
I real market value of considerable
nore than $3.50 per share. Business
conditions for the last four months
have been serious and exasperating.
NO doubt railroads, in common with
all the rest of us, have been losing
money, but already there is a bright
err outlook, and you who travel with
your eyes open sec passengers stand
ing in the aisies, and sidings con-
gested with loaded freight cars wait
ing movement. In the petition of the
eastern roads for large division of
the through rate, an offer of SIS.
100000 has been refused There is
little doubt but that larger sum
will be granted. if not the entire s27.-
100000 asked for. There will be a
saving in coal of from half a million
to million dollars: q saving in labor
of more than two million dollars, and
there can be and should be a very
considerable saving by reason of
stronger and better management. I
have made somewhat extended and
careful investigation of the affairs of
the Maine Central Railroad. and 1 am
confident that with good manage
ment, rates can be reduced, service
improved and dividends resumed in
the near future. I believe that the
road is entirely solvent, that the
stock is good property and should be
hold ripbf hoyo IN Moipo xy;+bo,,+