| The principal of the bonds issued to the Pacific Railroad Companies is | $64,623,512 00 |
| Interest at 6 per cent. to June 30, 1879 | 43,712,450 58 |
| Total, principal and interest | $108,335,962 58 |
| The total amount of compensation for services rendered by the companies covered into the Treasury to June 30, 1879, was | $12,915,591 27 |
| Of which there is applicable to payments of bonds and interest | 8,387,296 78 |
| To payment of 5 percent. net earnings | 4,201,348 50 |
| To payment into sinking fund | 326,945 99 |
The interest belonging to the sinking fund was $1,202.50, and the total balance against the railroad companies was $95,419,168.81.
The amount due by the government on December 31, 1878, and withheld from the Union and Kansas Pacific Companies on account of transportation, will more than offset the $2,737,576.85 payable by them on account of the “five per cent.” of their net earnings; but of the amount payable by the Central Pacific, $1,978,688.38, the amount withheld for transportation is insufficient by the sum of $648,271.96[1], payment of which amount in cash the Auditor has required of the company.
The result of the “5 per cent.” suit against the Union Pacific Railroad Company has been that the United States obtained judgment for $1,208,337.34, which is $1,029,547.08 more than the company admitted to owe; and the result of the examination of the accounts of the Central Pacific, undertaken by the Auditor immediately after the decision of the “sinking-fund case” by the Supreme Court, has been that the amount due by that company from November 6, 1869, to December 31, 1878, is $1,978,688.38, or $745,391.86 more than the company’s own statement admitted.
It is considered important that the sinking fund be credited promptly with all transportation moneys to which it is entitled; otherwise the companies will have just cause for complaint, as the act requires money deposits by the companies to be made at a given time in each year.
Under the present practice of the departments, by which many of these accounts do not even reach the accounting-officers by the time named in the act, it will be almost impossible for these settlements to be consummated within the period stated in the act — namely, calendar-year settlements — to be made by the first day of February in the following year.
Mr. A. B. Nichols, of Philadelphia, was appointed to the position of railroad engineer in the office of the Auditor of Railroad Accounts on August 18, 1879, and has since then examined into the condition of the subsidized and land-grant railroads. His report is given with that of the Auditor.
During the annual inspection it was found that improved business, especially on the Western roads, had induced great improvement in the
- ↑ This amount has been already deposited in the Treasury by the Central Pacific Railroad Company.
