REPORT

OF THE

SPECIAL COMMITTEE ON RAILROADS.

APPOINTED UNDER A RESOLUTION OF THE

ASSEMBLY,

FEBRUARY 28, 1879,

ΤΟ

INVESTIGATE ALLEGED ABUSES

IN THE

MANAGEMENT OF RAILROADS

CHARTERED BY THE STATE OF NEW YORK.

ALBANY:

WEED, PARSONS AND COMPANY, PRINTERS.

1880.

STATE OF NEW YORK.

No. 38.

IN ASSEMBLY,

REPORT.

January 22, 1880.

To the Honorable, the Assembly of the State of New York: The undersigned, a committee appointed in pursuance of the following resolution, adopted February 28, 1879 :

Resolved, That a special committee of five persons be appointed, with power to send for persons and papers, and to employ a stenographer, whose duty it shall be to investigate the abuses alleged to exist in the management of the railroads chartered by this State, and to inquire into and report concerning their powers, contracts and obligations; said committee to take testimony in the city of New York, and such other places as they may deem necessary, and to report to the legislature, either at the present or the next session, by bill or otherwise, what, if any, legislation is necessary to protect and extend the commercial and industrial interests of the State;

And also of a resolution adopted March 12, 1879, of which the following is a copy :

Resolved, That the number of members of the special committee of investigation into the relations of the railroads to the State be increased from five to nine, and be appointed by the speaker;

And also of a resolution adopted March 27, 1879, of which the following is a copy:

And it is further resolved, That the said committee be and is hereby authorized to sit during the recess of the legislature, and take testimony in the city of New York and elsewhere in the State as they shall determine, and cause their proceedings to be printed daily;

respectfully
[Assem. Doc. No. 38.]

not, acc.

1

.

REPORT.

Immediately after the appointment of your committee, a circular letter was addressed to commercial organizations of the different cities of the State, agricultural societies of counties, State Grange, Farmers' Alliance, mayors of cities, etc., asking them to appear before the committee personally, or by communication, at a meeting to be held in Albany on the 26th day of March, 1879, and particularly specify the abuses deemed to exist in the management of the railroads of the State. That letter met a general response. The Chamber of Commerce, and the Board of Trade and Transportation of the city of New York, submitted in detail charges of mal-administration, which were generally indorsed as covering the whole ground. (See first 36 pages of Proceedings.) In April following, Presidents Vanderbilt, of the New York Central & Hudson River Railroad, and Jewett, of the New York, Lake Erie and Western Railroad, addressed to the committee a joint letter reviewing the charges which had been made, and taking issue generally thereon. (Report of Proceedings, p. 37.) Upon the issue thus formed the committee proceeded with its labors.

Prior to offering the resolution which gave rise to your committee, the Chamber of Commerce and Board of Trade and Transportation had given assurances that they had already in their possession all the evidence necessary to sustain the charges made against the railroads, and offered to incur such expense as might be necessary thoroughly to proceed with the investigation. This offer was made in view of the contemplated opposition to the passage of the resolution, and to avoid the opposition that it was known would arise from economical quarters in case any provision was attempted for legal expenses.

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It was easily foreseen that the investigation would consume the entire interval between the two sessions. The members of the committee having active business pursuits to attend to at home, and, as is well known, receiving no compensation whatever for their services on the committee, did not feel like assuming, unaided, the labor of examining the mass of matter to which our attention was soon directed from various quarters and putting it in proper shape to be submitted in evidence; therefore the committee asked the fulfillment of this offer, and requested the employment of counsel as an aid to them in the prosecution of their labors. Simon Sterne, Esq., was retained by and appeared on behalf of those

bodies. He attended the principal meetings of the committee, and, under its direction, mainly conducted the examination of witnesses. J. H. Martindale, Esq., of Rochester, appeared for the State Millers' Association and the agricultural and manufacturing interests in the interior of the State.

It is due that the committee express its obligation to the Chamber of Commerce and the Board of Trade and Transportation, and especially to Charles S. Smith and F. B. Thurber, of the committees representing those Bodies, for their co-operation and assistance, which contributed largely to the success of our work; and also to Mr. Sterne for the able, painstaking and thorough manner in which he performed the duties assigned him. His previous study of the subject and fund of information possessed were a very material aid in prosecuting our labors and developing facts sought for.

The railroads were represented by the best legal talent — Judge William D. Shipman representing the Erie, Hon. Chauncey M. Depew, Frank Loomis, Esq., and A. P. Laning, Esq., the New York Central. Other interests and individuals were also represented by different attorneys at various stages of the proceedings.

Your committee commenced taking testimony June 12th, in the city of New York, held several sessions in that city, as well as in Rochester, Buffalo, Ogdensburg, Utica, Albany and Saratoga, taking only such adjournments as were necessary thoroughly to prepare and digest the evidence for the ensuing meeting, and closed their investigation December 19th, having taken in all more than 5,600 pages of testimony.

The investigation has been as complete and exhaustive as, during this period, it could be made. The railroads, though frequently objecting, have complied with all the requirements of the committee. They placed their books at our disposal, and the evidence adduced is mainly obtained from the books and the officers of the companies examined. It, therefore, admits of little contradiction on the part of the railroads.

The entire answer of the roads was submitted by Mr. Blanchard, Assistant President of the Erie, who reviewed all questions raised by the investigation and testified both as to facts and as an expert. The instrumentality of their reply was well chosen. Mr. Blanchard's comprehensive grasp of the subject, added to his thorough knowledge of detail, his clearness and cogency of expression, rendered him exceptionally competent to discharge the duty assigned him.