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LETTER
from the
President of the Boston & Maine Railroad,
í/ "
replying to Mr. George B. Leighton's
Pamphlet, dated August 20,
1906, entitled
"The Boston & Maine as a Public Service
Corporation in New Hampshire"
BOSTON:
Rand Avery Supply Company, Printers
1906
Of" sAl'-VvAY ECCNîOAîICî.;
•-VAShíWCTOW. D C.
Boston & Maine Railroad
President s Office
Boston, September 14, 1906.
Mr. Geo. B. Leightox,
Monadxock F.irms,
Monadxock, N. H.
Dear Sir, —
A pamphlet entitled "The Boston & Maine as a Public
Service Corporation in New Hampshire," and bearing your
signature, with date of August 20, 1906, has just been brought
to my attention. It is so replete with erroneous statements
and conclusions that its perusal leaves me somewhat in doubt
whether its preparation is the result of ignorance of the facts
with which it pretends to deal, or is a deliberate attempt to
maliciously misrepresent and mislead.
Second Track
Among other things it says of this Company;
" It operates about 2,200 miles, of which just one-
half, or 1,100 miles, are in New Hampshire. We
find that of these 1,100 miles but 81 has second
track. The commissioners' reports do not tell
us how much this has been increased from year
to year, but it is very little."
The Boston & Maine Railroad operates 2,287 mdes of
through trackage in five states and the Dominion of Canada,
and of this, 511 miles of its busiest and most densely populated
portions have second track.* It is well known that the con¬
struction and maintenance of second track adds at least fifty
per cent, to the cost of operation as compared with that of
single track, and it is equally well known that no intelligent
railroad management feels justified in adding to its current
♦The New Haven Road's annual report, for the year ended June 30, 1905, shows its
through trackage to be 2,046 miles, and that of this, 677 miles—its main trunk lines—have
second track.
3
obligations this enlarged cost of operation except as the con¬
gestion of traffic upon its lines of single track warrants the
increased expenditure. The main line of this road's Fitch-
burg Division between Boston.and Rotterdam Junction—2x2
miles—its Southern Division from Boston to Concord, N. H.—
75 miles—its Eastern Division from Boston to Portsmouth—
56 miles—its Western Division from Boston to Rockingham
Junction—55 miles—its Connecticut River Division from
Springfield to Greenfield—37 miles—and its Worcester &
Portland Division from Worcester to South Lancaster—
18 miles—have double track ; and it has at other places upon
its lines 58 additional miles of second track at such outlying
points as prompt and efficient operation renders expedient.
In the matter of providing additional second track the Road
has kept itself fully abreast of the needs of its customers and
of all increases in its traffic, and the same policy will be intel¬
ligently pursued in the future.
Block Signals
You say, "Unfortunately, too, we find no
statistics as to the installation of block signals
on lines of heavy traffic, and we are compelled
to believe that there has been no such added
safeguard to traffic in New Hampshire."
Upon certain of the denser portions of its lines radiating
from Boston, this Company has long had in use efficient block
signalling systems, and about two years ago it adopted a
systematic plan of enlarging this method of controlling the
movement of trains, and it now has under contract the instal¬
lation of 700 miles of additional block signals of the most
modern type, and it is its purpose to go on with this construc¬
tion as rapidly as it is able to procure the materials therefor,
until all of its main lines and more important branches are
properly and efficiently equipped therewith. It is well known,
however, by all who have had to do with this matter of estab¬
lishing new block signals, that the manufacturers of them
are unable to anywhere nearly meet the present extraordinary
4
demand for them, and that this work is likely to be delayed
upon every railroad much beyond the period within which its
completion is desired. The management of this Company is,
however, doing everything in its power to expedite this work,
and the element of cost in no way enters into its consideration
of the question.
You also say, "Possibly the public are not
aware that on the Boston & Maine a green light
has been in use for safety. This is the best
practice; but on the Fitchburg white was used
for safety, and since taking over the Fitchburg
in 1900 the Boston & Maine management have
never changed it. This is a most dangerous
condition of affairs, interwoven as the lines are at
Boston, Greenfield, Bellows Falls and other
places."
Under the Standard Code of Operating Rules, the use of
either green or white switch lights indicates safety, and is
optional, and I do not see how you can make it appear that
the use of white lights upon switches—even though they are
intermingled with green upon some portions of the line—can
ever produce "a most dangerous condition of affairs." I may
say, however, that in accordance with the best modem prac¬
tice, this Company is changing its method of signalling and is
ever3rwhere substituting green for white as a safety signal;
but, pending these changes, the continued use of green and
white switch lights, each meaning safety and nothing else,
can in no way lead to dangerous results.
Bridges and Ties
You speak of the large number of wooden
bridges and trestles upon the Boston & Maine
System, saying they are " all subject to fire and
most of it unable to carry large engines or heavy
loads."
I have never yet found a capable engineer of railroad con¬
struction who has any doubt as to the safety of a properly
S
constructed wooden bridge for any load that it is designed to
carry ; and it is well understood that in the matter of deteriora¬
tion the wooden bridge always gives arnple notice of weakened
parts, while the metal bridge seldom gives such notice until
it wholly fails. In replacing bridges, the question whether
the new structure shall be of wood or metal is, in each case,
carefully gone into and a decision is made upon the merits
of each case. I do not recollect that upon any portion of
this Company's lines any accident has ever occurred because
of the failure of a wooden bridge; but there is, unfortunately,
a record of some very serious accidents, in different sections
of the country, that have occurred through the breaking down
of metal bridges, about the unsafety of which there was no
means of knowing until the accident occurred.
I am glad to know that you are reasonably assured that
renewals of ties have been sufficient to keep the Road's track
in a safe condition. Perhaps I may add to this assurance
by telling you that, under its normal practice of replacement,
eighty per cent, of all of the ties used, not only in the Road's
main tracks and branches but in its sidings, have been renewed
during the last six years, and by saying to you that, with
full knowledge of the subject, I do not know of a railroad
anywhere that is kept in a more efficient condition in this
particular than is the Boston & Maine.
Rail Renewals
You say, " A considerable amount of new rail
has been laid of late, but so much of the mileage
in New Hampshire is very light rail that there
still remains a very great deal to be done."
Each year rail renewals are made in quantities more than
sufficient to keep all of the tracks at a high standard of effi¬
ciency, and, following this custom, the Road has, during the
past six years, relaid more than i,ioo miles of its tracks with
rails of modem weight and standard, and there is no warrant
for saying that there is, upon any part of its system, in New
Hampshire or elsewhere, a "great amount of very light rail."
6
The fact that there has not been an accident to any of our
trains within my recollection, that was in any way due to
the lightness of the rails used, would seem to be competent
evidence in support of the statement that the Road's tracks
are, in this particular at least, everywhere kept in a condition
suitable for the safe, comfortable and expeditious handling of
its travel.
Grade Crossings
You say, "In New Hampshire practically no
grade crossings have been abolished."
In this, too, you are in error. A number of highway cross¬
ings within the State of New Hampshire have been separated,
and these wholly at the cost of the Railroad; and it is, and
has been, ready to join with the communities it serves in
other separations of highway grade crossings when the parties
in interest so desire, and are willing, as is the law or custom
in other states, to participate reasonably in the cost of the
improvement.
Station Buildings
You say, "There are no statistics as to sta¬
tions, nor are there any stations in the chief
towns of New Hampshire worthy of note save
at Concord. The North Station in Boston, when
it was rebuilt fifteen or more years ago, was, if
I remember rightly, supposed to be temporary,
and certain privileges were asked with this in
view ; but there seems to be no sign of anything
more adequate in the future."
If you will go to Manchester, N.H., you will find modern
and adequate passenger and freight station facilities, erected
by this Company within the past few years at a cost of nearly
a half million dollars; and if you will familiarize yourself
with the stations elsewhere in the state, you will discover
that they compare favorably as to construction and main¬
tenance with those supplied under like conditions by other
7
railroads. As to the North Station in Boston : It was erected
in 1893 upon land owned in fee by the railroads using it, and
I know of nothing warranting your supposition that it was
a temporary structure. No special privileges were asked or
given in connection with the location or construction of the
station, and not a penny of the two and one-quarter million
dollars expended upon it was provided by any party other
than the railroads owning it.
Reduction of Grades
To your statement alleging failure of this
Company to reconstruct its lines within the State
of New Hampshire so as to reduce grades and
enlarge trainloads.
A large amoimt of work is being constantly carried on in
readjusting the grades of this Company's lines upon all parts
of its system, but to accomplish any material result in the
way of increasing the trainload within the mountainous por¬
tions of the State of New Hampshire would require the
levelling of mountains and the filling of valleys to an extent
beyond human power of accomplishment. In your summing
up, that " not a single line of the Boston & Maine through the
State of New Hampshire is able to carry full trunk-line loading
except the old Western Division main line," you have evidently
overlooked the main line from Concord to Boston, the average
trainload upon which is sixty loaded cars, and the Eastern
Division and the Worcester & Portland Division, all of which
pass into or through New Hampshire, and upon which regular
trains of forty fully loaded cars are operated.
Rock or Gravel Ballast
You also say, "Absence of rock ballast on
the entire system I shall be charitable about,
but railroad men everywhere admit that this
is now a necessity on trunk lines."
Much study has been given to this subject, and I am quite
8
sure I know the consensus of railroad opinion to be that it is
neither wise nor economical to use rock or slag ballast where
good gravel ballast, such as is plentifully found almost every¬
where in northern New England, is readily obtainable. The
New Haven road has rock-ballasted its main lines from
Springfield to New York and from New London to New Haven ;
but from my former connection with that company, when
much of this ballasting was done, I know that there is not,
upon any part of these lines, any appreciable quantity of
gravel ballast that can be obtained for railroad use. This
absence of gravel ballast is true as to nearly every railroad
system in the country that has made use of rock ballast, and
it is a matter for congratulation that the railroads of northern
New England have been able to construct and maintain their
lines with the much-to-be-preferred gravel ballast, and have
not been obliged to assume the extraordinary expense and
trouble of using rock ballast.
Comparisons of Train Speed
In your reference to relative increases in this
Company's train service from 1890 to 1906, you
say, " On the New Haven all through trains do
the 108 miles Boston to New London in two
hours forty-two minutes or better, and the best
trains in two hours nineteen minutes. The
difference is, the New Haven has a 'modern high¬
speed railroad, while the Boston & Maine has the
Salem Tunnel, Portsmouth Bridge, and a few
other like barnacles."
It is well known that the trar^el between the great cities
of New York and Boston is larger in volmne than between any
other two similarly situated cities on this continent, and that
to accommodate this travel the New Haven road, which carries
it all, finds it necessary to operate a large number of fast
through trains which do not depend upon intermediate business
for their maintenance; consequently, an attempted compari¬
son of the numerous lines of the Boston & Maine radiating
through the relatively sparsely settled portions of northern
New England with this specially favored trunk line of the
9
New Haven System, is not only fallacious but unfair. The
Salem Tunnel and the Portsmouth Bridge are both upon the
Eastern Division of this Company. To do away with the
former involves a large expenditure for separating crossings,
etc., in which the City of Salem and the Commonwealth of
Massachusetts must participate, and possibly an entire change
of the line of the railroad through the city. Until recently
the City of Salem has never expressed a willingness to have
the solution of this problem taken up, but negotiations looking
to that end have now been opened and plans are being formu¬
lated with a purpose of doing away with this obstruction to
rapid train operation in that section. It may be said in
passing, that in the operation of trains through the Salem
Timnel, no question of safety is involved, as it is controlled
by interlocked signals and derailing switches, and the entry
into it of two trains at the same time and accident resulting
therefrom are. beyond the range of possibility. The Ports¬
mouth Bridge is a stable although unhandsome structure,
with factors of safety many times greáter than- are required
for the safe carriage of the heaviest modem locomotives and
trains which are being regularly sent over it. The low speed
used over this bridge is on account of its being a drawbridge.
Plans are now being formulated for an extension of second
track from Portsmouth eastward, and the substitution of a
new steel bridge at another location comes within the scope
of these plans.
You further say, "Again, on the Southern
Division Boston to Concord, the distance is 75
miles and the better trains do it just as they
did it ten years ago—two hours; while on the
New Haven most of the trains between New
York and New Haven do the 75 miles in one
hour and thirty-seven minutes to one hour and
forty minutes. I might multiply instances, but
it would be useless."
It is true that the distance from New York to New Haven
is the same as that from Concord to Boston, but in other
particulars your comparison is not only inaccurate but
untmthful. The railroad from New York to New Haven is the
10
trunk line of the New Haven System, over which passes all of
the enormous rail travel between Boston and northern New
England and New York. It has upon it three populous cities,—
Bridgeport, South Nonvalk and Stamford,—and for the accom¬
modation of its through and intermediate business a large
number of express trains are required. Reference to the
Pathfinder Guide for September, page 86, shows that twenty-
one through express trains are operated from New York
to New Haven. Of these, nine—not, as you say, most of
them—are fast express trains to Boston, which make no stop
between New York and New Haven, and halt at the latter
place only because, of the operating necessities incident to a
divisional point. These nine trains make the run in from
one hour and thirty-four minutes to one hour and forty-six
minutes, and the other thirteen trains, which make stops at
some or all of the intermediate stations above named, make
the time in from one hour and fifty minutes to two hours.
Between Concord and Boston, neither of the cities of Concord,
Manchester, Nashua or Lowell furnishes traffic enough to
warrant the running of any through fast trains such as are
required for the carrying of the travel between Boston and New
York; and if the operation of such trains were attempted, each
of the four cities would demand that it either have its inde¬
pendent and separate train, or that every train be stopped at
its station. For the accommodation of travel from Concord
and points north and south thereof to Boston, fourteen daily
trains are nm. Five of these are- two-hour expresses, making
stops at Manchester, Nashua and Lowell, and are therefore
exactly comparable to, and are run at the same speed as, the
trains between New York and New Haven that stop at the
three intermediate cities,—Bridgeport, South Norwalk and
Stamford.
Mail Facilities
To your comments upon the lack of early morn¬
ing mail and newspaper deliveries at various
points upon the Boston & Maine System, notably
its Connecticut River Division.
You undoubtedly know that Government fixes the com-
II
pensation of railroads for mail transportation by its quadrien-
nial thirty days' weighing of the mail transported; and that,
consequently, no railroad gets any increase of compensation
for any additional mail-train service that it may establish
until after another quadriennial weighing takes place. News¬
papers are carried and delivered by railroads at a price so low
that relatively small compensation is made through them
toward the cost of a train's operation, which, in New England,
is approximately $i.oo a mile. It has been demonstrated
that, with the exception of through sleeping-car trains between
distant cities, very late night, or very early morning, trains
run for local accommodation caiTy very few passengers, and
that only a trifling amount of revenue is received therefrom.
It cannot, therefore, be expected that railroads supply train
service solely for the carriage and delivery of early mails
and morning newspapers when there is no possibility of their^
receiving compensation therefor sufficient to pay even a
moiety of their cost of operation.
As to the admitted need of through New York and northern
night-train service over the Connecticut River Division, which
is, as you say, discontinued when the White Mountains sum¬
mer hotels close their doors : This Company has always
expressed its willingness to join in running daily throughout
the year a night train in both directions, with sleeping and mail
accommodations, between Montreal and New York by way of
its Connecticut River Division; but for reasons over which it
has no control, it has not as yet been able to induce its south-
em connection to furnish its necessary part of this service.
You further say, "Most roads desiring to
develop traffic establish every new train that they
think will pay running expenses. The policy on
the Maine seems to be to establish a new train
only when it is impossible to haul all the traffic
offering on existing ones. It is safe to say that
the daily passenger train mileage over the system
could be profitably increased twenty per cent."
This Company has each year added, on every part of its
system where such additions seemed warranted, new train
12
service ample in quantity to fully provide for every antici¬
pated increase in its passenger traffic, and in this particular it
provides relatively as much as does any other railroad having
like traffic conditions.
Trolley Competition
You also say, "As affecting the passenger ser¬
vice, I may allude to the Boston & Maine's
hostility to trolley development in New Hamp¬
shire. No more conspicuous bit of bad judgment
in corporate management is known to the writer
than that of using the words 'Boston & Maine'
on the trolley cars in Concord."
Several years ago the Legislature of New Hampshire passed
a feasible and workable general law under which it is possible
to construct any^vhere in the state any trolley road required
by public exigency and necessity. Since the passage of that
law, the Boston & Maine has never opposed the building of
trolley roads under the provisions of this law except in a few
instances where the proposed lines were clearly for promoting
purposes only, and gave no evidence of their being required
to meet any public exigency or necessity.
You are perhaps unaware of the fact that under authority
given by the New Hampshire Legislature, the Concord &
Montreal Railroad, now operated as a part of the Boston &
Maine, in 1903 purchased the Concord Street Railway, and
that it has since been operated as a part of the Boston &
Maine System exactly as it would have been had it been a
steam-railroad branch. This being so, I do not understand
what impropriety you think there is in the use of the title
"Boston & Maine" upon the cars of this electric branch.
In passing, it may be of interest to note that after the
purchase of this Concord Street Railway, it was changed
from narrow to standard gauge, its superstructure entirely
replaced, and portions of its line extended, at a cost to the
Boston & Maine Railroad of about $200,000.00,-and that it is
now one of the few successfully operated trolley roads in the
State of New Hampshire.
13
Passenger Rates
You say, "Some years ago the New Haven
put all its single fares on a two-cent basis, and
this road's receipts have jumped ahead with
bounds, while the Boston & Maine has grown only
the barest trifle in the five years from 1900 to 1905.
If we add the Fitchburg and Boston & Maine pas¬
sengers paying revenue as shown in the New
Hampshire report for 1900, we find that the total
is greater than the Boston & Maine shown in the
report of 1905 by several million passengers."
The statement that the New Haven road put all its single
fares on a two-cent basis some years ago is incorrect. Many
years ago the New Haven road adopted the two-cent-a-mile
basis on its main line between Springfield and New York, but
upon the greater portion of its system elsewhere its fares have
been upon the basis of two and one-half and three cents a mile ;
and its present through fare from Boston to New York of $5.00,
limited, is now upon the basis of about two and one-quarter
cents a mile by its shortest line. It is, however, true that the
New Haven company has announced its intention to make
gradual reductions in its passenger rates until, in the near
future, all of its lines shall have been brought down to the
two cent-a-mile basis.
As to the addition of the Fitchburg and Boston & Maine
passengers before the roads were consolidated producing a
greater total than those of the Boston & Maine after the con-
sohdation: You apparently overlook the obvious fact that
there has always been a very large interchange of passengers
between the two roads, and that before their consolidation
a passenger using both roads would count in the aggregate
you have compiled as two passengers, while after the con¬
solidation his travel upon both railroads would count as only
one passenger.
As to the alleged small increase in Boston & Maine pas¬
senger business: The number it carried in 1906, as compared
with 1901, upon practically the same operated mileage, not
including its electric-road passengers, increased over one and
one-half millions, and its average rate of fare received there¬
from was 1.769 cents.
14
To your remark that "the soo-mile book sold for $11.25
in New Hampshire is good in Massachusetts, but the 500-mile
book sold in Massachusetts for S10.00 is not good in New
Hampshire":
In connection with plans which have been for a long time
under consideration for the readjustment of some of the Com¬
pany's passenger rates, the experiment of selling 500-mile
books, good upon its densely populated lines in Massachusetts
at two cents a mile, was tried, and after full experience and
before any public discussion of the subject was made, it was
decided to extend the sale and use of the 500-mile book at two
cents a mile over the whole system, and this plan was made
effective September ist. Upon a considerable portion of the
system the regular single-fare rate has long been at the rate
of two cents a mile, and this fare grades upward in less densely
populated sections to two and one-half and three cents a mile.
The matter of reducing these higher rates in outlying sections
has been for some time under consideration, and, in accordance
with the tendencies elsewhere, the management hopes to find
justification for their readjustment in the near future.
Dining Cars
Again I quote, "The Boston & Maine does
not own a dining car. It allows one of the New
Haven System to be operated on its Connecticut
River Division in summer. This is a record that
I think cannot be equalled elsewhere in the world
to-day—a system of twenty-two hundred miles of
railway without a dining-car service."
This is another and characteristic misstatement about the
Boston & Maine. Early in the year it ordered and has now
received and owns six dining cars which are to go at once into
service in the through w^estem trains of its Fitchburg Divi¬
sion. As the cars used in the night-and-day through service
between New York and the White Moimtains are contributed
proportionately by the roads making up the line, and as the
New Haven manages from New York a large number of dining
IS
cars in its Boston services, it is arranged, in the common
interest, that it furnish and operate the dining-car service
needed in the White Mountains Line.
Upon the Boston & Maine's New York and Bar Harbor
through train via Worcester and Portland, first-class dining-car
service is supplied upon the daylight portion of the run east
of Portland, as a matter of joint arrangement between the
Boston & Maine and Maine Central roads ; and upon the through
lines from Boston to Montreal, in which the cars are jointly
supplied by the Boston & Maine, Canadian Pacific and Central
Vermont, adequate and satisfactory dining service has been
furnished for many years.
Most of the through train runs upon the Boston & Maine
are short, and arrivals and departures give suitable hours for
meals at the termini, and the need of dining cars upon those
trains is not yet suificientfi'' apparent to warrant their operation.
When it becomes so they will be provided.
Freight Rates
You express general satisfaction with the
Road's New Hampshire freight rates and say they
seem in general to have fostered the state's indus¬
tries; but as to its coal transportation, you say,
"Coal rates in New Hampshire are high (higher
than elsewhere where like conditions prevail), and
the earnings from coal are over twenty per cent,
of the entire freight earnings of the System—
much larger than any other item. Take Man¬
chester, for example; the rate from Portsmouth
is 75 cents for 41 miles. From Boston the rate is
purposely made prohibitive, I am told. It is $ i. 00
for 56 miles. Why so? I should like to know.
The 75-cents rate from Portsmouth is high in
itself because the traffic is handled in trainloads,
and further because coal is in the nature of a raw
material in the cost of manufacturing and of liv
ing in New Hampshire. This rate is much higher
than Illinois and Missouri coal rates to small
towns where traffic is by carload, not trainload,
and higher than Minnesota railways charge on
coal from Duluth to interior points,—a strikingly
16
similar condition. On "all rail" from the coal
mines, Manchester has to pay a rate of S3.25
against S2.79 onty to Worcester. No doubt the
Maine handles coal to Worcester via Gardner,
and the distance to Manchester is 35 miles more
than to Worcester, while the rate is 55 cents
more. "
As to the rate of seventy-five cents a ton upon coal from
Porstmouth to Manchester, 41 miles : This rate is ten cents
a ton lower than is charged for similar coal transportation
from Providence, R.I., to Worcester, East Weymouth, South
Hanover, Brockton and Plymouth, and is exactty the same as
is charged from Fall River to Brockton, a distance of 31
miles. It includes free wharfage furnished the Boston &
Maine Railroad at Portsmouth and switching to the coal bins
of the mills in Manchester; and the cost to the Railroad of
these two items, plus other necessarj- terminal expenses,
aggregates not less than fifty cents a ton, so that the net
amount actually received by the Railroad for hauling this coal
41 miles is not over twenty-five cents a ton. The same
conditions apply to coal hauled from Boston, and out of the
freight rate received for coal transportation at least fifty cents
a ton must first be deducted for terminal and other outlay by
the Railroad, and whatever balance is left represents the
amount received by it for haulage.
The Boston & Maine coal transportation rates throughout
its system are as low as those given by any other New England
railroad doing the business under like conditions of environ¬
ment.
For the haulage of coal all-rail from the mines to Manchester
at $3.25 a ton, the proportion received by the Boston & Maine
for its 211 miles is S 1.50 a gross ton, and the balance of the
rate is absorbed by the roads dehvering the coal from the
mines to the Boston & Maine Railroad. These rates are, in
my judgment, after comparing them with those charged tmder
hke circumstances by railroads elsewhere in the country,
entirely reasonable, and they do not compare unfavorably
with the rate of $2.70 a gross ton made by the New York
Central Railroad over its short Hne from the mines to Worces¬
ter, Mass.
17
Comparison with rates charged in Illinois and Missouri
are of little value unless one knows all of the controlling cir¬
cumstances, including the cost of railroad operation in those
sections, that govern the transportation; but it can be said
without fear of contradiction, that the Boston & Maine Rail¬
road so adjusts its coal transportation rates, in so far as it is
able to do so, as to give to its manufacturing customers every¬
where the most favorable means of procuring this necessary
commodity.
Dividends and Surplus
You also say, " In conclusion, what is the
matter with the Boston & Maine? As one man
forcibly expressed it, seven per cent. It is true
its capital stock is small in the aggregate and
small per mile, but the net earnings do not and
have not justified seven per cent, dividends for
some years. The annual reports show practically
no surplus earned after paying dividends ; in one
recent year the surplus was only $22,000.00.
This for a company having gross earnings of
thirty-six millions is no surplus. We know well
that little if anything has been charged to operat¬
ing expenses that could, by any reasoning, be
charged to capital. ' '
If you had examined the annual reports of this Company
covering the past twelve years, the fallaciousness and inaccu¬
racy of these statements would have been clearly apparent to
you. First, as to the dividend paid, which is $6.00 a share
upon $3,149,800.00, at par, of preferred stock, and $7.00 a share
upon $24,637,600.00, at par, of common stock, aggregating for
the year ended June 30th, $1,834,646.00. Under laws passed
by Massachusetts in 1893, and, at the initiative of this Company,
by the legislatures of New Hampshire and Maine in the year
1901, all subsequent issues of capital stock by railroads char¬
tered within these states have been either distributed to
stockholders at prices fixed by the Railroad Commissioners, or
sold at public auction to the highest bidder. Premiums have
up to. this time been received upon the stock of the Boston &
Maine now outstanding, so that, including its last issue of
September I st, 1906, the par value capitalization of its common
stock of $25,821,000.00 has produced for its treasury a total
of $39,280,000.00, or an average of $152.00 a share, and at
this price its common stockholders are receiving dividends at
an average rate of 4.6 per cent., instead of 7 per cent. If you
had further examined the Company's annual reports you would
have found therein the frequently repeated statement of its
policj^ of expending practically all surplus earnings above its
operating expenses, fixed charges, and dividends, in the
improvement of its property; and as, from the year 1901 to
1906, the Company's gross income, with an enlargement of
operated mileage of only 23 miles, increased $8,460,668.00, and
in the same period its total fixed charge and dividend dis¬
bursements increased but $454,224.00, there has been expended
from earnings during this time for better operation and main¬
tenance and for additions and improvements to the property,
about eight millions of dollars. In addition to this sum,
moneys have been derived during the same six years from the
issue of new capital obligations to the amount of $8,500,000.00,
and all of this has also been expended in the improvement of
the property; so that instead of, as you indicate, little if an\'-
thing having been expended for improvements, there has in
fact been expended for this purpose during the last six years a
matter of over sixteen millions of dollars.
The Railroad Not in Politics
In conclusion you add, " In this short dis¬
cussion, I have not dwelt upon the Boston &
Maine in politics. I take it that our people are
awakened and that they will see that the corpora¬
tion no longer dominates legislation as it has done.
We are not going to have committees named in
the North Station, Boston, as has been the case,
or be told from the same source that this or that
'good roads bill' can or cannot be passed, as has
also been the case in the past."
Notwithstanding the recent widel}' disseminated statements
to the contrary, neither the management of this Company
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nor anyone having an office in the North Station, Boston, has,
during the thirteen years that I have been familiar with its
affairs and policy, attempted to dominate the legislation of
New Hampshire, to name committees, or to determine whether
a good roads or other bill can or cannot be passed ; and if any
person or persons have assumed, either in New Hampshire or
in any of the five states in which this Company operates, to
use its 'name and authority in promoting or opposing any
legislation in which it did not possess an undoubted and
indisputable interest and a proper right to an open hearing
of its case such as would appertain to the rights of an}-' other
citizen, they have done so not only without the approval and
knowledge of its management, but contrar}' to 'its explicit
and clearly understood instructions,
I must apologize for the length of this communication, but
there seemed to be no way of abbreviating it and, at the
same time, answering your most important allegations.
Yours truly,
Lucius Tuttle,
President.
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