Railway Company, the Southern Pacific Railroad Company of California, the Central Pacific Railroad Company, and several other subsidized roads. Substantial improvements have been made in the main lines, heavy steel rails have taken the place of iron rails, wooden bridges have been replaced by iron and steel, and the ballasting has been much improved.

All railway companies should make reports to this office at the end of the fiscal year of their increase of mileage during the year and of mileage discontinued, in order that these reports may be compiled and laid on the desks of the Senators and Representatives at their meeting in December of each year.

GOVERNMENT LINE TO THE PACIFIC COAST.

We have every reason to believe that we are about to enter in the near future into new trade relations with our new possessions and through them, thus promising a continued and growing prosperity for our people for many years to come. Accordingly I beg leave to renew the suggestions of my last report, urging the air-line railway from Kansas City to San Diego, Cal. Such route should be on the shortest line between the cities of Boston, New York, Philadelphia, and Baltimore to the Pacific coast, where, on the parallel of the Sandwich Islands and the Philippines, it would find the shortest route to these possessions and to their commercial and military relations. Similar routes should be opened between the cities of Chicago and San Francisco, Chicago and Seattle, and Galveston and San Diego, to draw a great part of the world's commerce over our wilderness possessions and transfer it to the heart of the universe. The nation's manifest destiny to become one of the greatest commercial powers of the earth, strengthening and increasing our merchant marine with the spread of commerce, calls for generous and prompt recognition and encouragement. All of these lines would probably not cost more than the three or four hundred millions that will be needed for the construction and equipment of the isthmian canal. They would give us healthful latitudes that are not to be found on the Isthmus, keep our money at home, furnish rapid transit for all kinds of trade, and command a large portion of the vast commerce of the world.

The increasing traffic over the transcontinental routes warrants the assumption that there will be an abundance of traffic for all routes, while the moderate rates of the Government system will hold all to reasonable charges, thus protecting the people in the transit of their travel and traffic. The system extended by steamers to our new possessions will add life and spirit to all lines of commerce and labor until employment will be at hand for all who prefer it to idleness.

These possessions, with those of the West Indies, are grand gifts of Providence to be improved and developed in pursuance of His great

designs. Woe must be the end of a people who reject and contemn the munificence of a generous God.

The increase of surplus-assets over liabilities-for 1899 over 1898, for the twenty-six land-grant and bond-aided roads, is $45,230,089.28. Attention is invited to the following statement, showing the increase of the net earnings of the different railroad companies for the last two fiscal years:

Attention is also invited to the following statement, showing the increase of earnings and expenses for 1899 over 1898:

BOND-AIDED ROADS.

UNION PACIFIC RAILROAD COMPANY.

The pecuniary interests of the Government in the Union Pacific Railroad terminated on November 1, 1897, when its main line was sold to the purchasing trustees of the Union Pacific reorganization committee, under a decree of the United States court for the district of Nebraska. The bids of the trustees, which were accepted, and the sale confirmed on November 6, 1897, covered the entire indebtedness to the United States to November 1, 1897, including the $13,645,250 in bonds at par, then held by the Secretary of the Treasury for the Union Pacific sinking fund. The amount due the Government consisted of the following items:

This balance was required to be paid in four equal installments within thirty, forty, fifty, and sixty days, respectively, after confirmation of sale, all of which payments have been made. The amounts actually realized by the United States from the said sales and from the provisions in the decree are as follows:

Amount paid for railroad, franchises, and property...

For securities in sinking fund....

Cash in sinking fund applied...

Interest collected November 1, 1897, on bonds in sinking fund..............

Total amount realized

$40, 253, 605. 49 13, 645, 250.00 4,537,

921.39

11, 446. 87

58,448, 223.75

A second foreclosure suit instituted by the United States against the Union Pacific Railway Company and others, for the foreclosure of the mortgages on the bond-aided portion of the Kansas Pacific, was prosecuted to a final decree, and this road was sold on the 16th day of February, 1898, to Louis Fitzgerald and Alvin W. Krech, as purchasing trustees, for the sum of $6,303,000, which amount has been duly paid into the Treasury of the United States. The purchasing trustees duly transferred and assigned their bid, and all their rights as bidders and

purchasers of said railroad, franchises, and property, to the Union Pacific Railroad Company.

In the decrees for the sale of the Union division and the Kansas division it is stipulated that they are sold subject to the following provision:

"Saving and excepting the right of the United States Government to have the preference at all times in the use, at fair and reasonable rates of compensation, not to exceed the amounts paid by private parties for the same kind of service, of the said telegraph line and railroad for the transmission of dispatches over said telegraph line and the transportation of mails, troops and munitions of war, supplies, and public stores upon said railroad for the Government whenever required by any department thereof."

The entire indebtedness of the Kansas Pacific Railroad Company to the United States was $12,891,900.19. There remained, after deducting $6,303,000, the amount realized from the sale, a balance of $6,588,900.19 still due the United States. Proceedings were instituted last year against the receivers of the Union Pacific Railway Company, a claim being filed on behalf of the United States on account of the above deficiency against certain funds remaining in their hands. The matter has since been brought to a conclusion with the satisfactory result that the United States procured a decree directing the receivers to pay on account of this deficiency, out of moneys in their hands, the sum of $821,897.70, which sum has recently been paid into the Treasury of the United States and is to be credited against the deficiency above mentioned.

The Union Pacific Railroad Company was incorporated June 23, 1897, and has become the successor to the lines of the Union Pacific Railway Company. The entire main line was opened to public business April 15, 1898.

By the acts of 1862 and 1864 lands were granted by the United States to the companies forming the present corporation as follows:

The following points are the land-grant termini: Union Pacific, Bridge Junction, Omaha, Nebr., and Union Depot, Ogden, Utah; Kansas Pacific, Kansas City, Mo., and a point on the railroad between Monument and Gopher stations and Eighteenth street, Denver, Colo.; Denver Pacific, Denver, Colo., and Cheyenne, Wyo.

The records of the General Land Office show that during the fiscal year there were patented to this company 8,279.85 acres. The num

ber of acres patented to June 30, 1899, as shown by the books of the General Land Office, is as follows:

The report of the company shows that to June 30, 1899, they had acquired in the reorganization, by purchase, unsold lands, including lands not yet patented, amounting to 4,061,154.02 acres, and by cancellation of contracts 86,701.61 acres. Of this there had been disposed of for cash on time contracts 206,307.58 acres.

The total cash receipts from all sales from the date when the lands were acquired amounted to $460,583, and there were outstanding on account of time sales $455,329.81. The average price per acre now asked for land is 75 cents.

At the close of the fiscal year the total number of miles operated was 2,848.38. The track is laid with steel rails of various weights, from 52 to 90 pounds per yard. There are, however, 130.55 miles laid with iron rails, from 50 to 58 pounds per yard. The cross-ties are of oak, fir, pine, and cedar, and average 2,952 to the mile. Their average price at present is 41 cents. The track is fenced for 1,450 miles. The ballast consists of 22.65 miles of stone, 315.35 miles of gravel, 136.90 miles of cinder, 23.03 miles of burnt clay, 18.20 miles of crushed slag, and 2,339.29 miles of natural soil. The bridges aggregate in length 163,830 feet.

The assessed valuation of roadway, bridges, track, buildings, rolling stock, etc., for taxation, averages $8,247 per mile, or a total of $23,492,001.

The express business is transacted by the Pacific Express Company, the railway company receiving 50 per cent of the gross earnings.

The 5 miles of track from Ogden, Utah, to the western terminus of the road are leased to the Central Pacific Railroad Company, under a contract dated February 10, 1888, for a consideration of $20,000 per

annum.