It would follow that the State, retaining the tunnel, should operate it, and should also own or control one line of road between Boston and the West, at the same time giving to all parties, without discrimination, equal advantages to the tunnel. The state management cannot afford to be unjust or to discriminate.
No private corporation can be trusted when its own interests may conflict with the interests of other and perhaps rival corporations, to establish or to enforce rules for the transaction of such business. We therefore report and recommend the passage of the accompanying Bill: "To incorporate the State Board of Trustees of the Hoosac Tunnel Railroad."
Its purpose is to form a corporation for the management of the Troy and Greenfield Railroad and Hoosac Tunnel, with all the powers of a railroad corporation. It is to be composed of five trustees, to be appointed by the governor and council, each to hold office for five years, and one of whom shall be appointed annually. To these five state trustees are to be added not exceeding three, one by each of the railroad corporations whose property may be acquired or managed under the terms of the Act.
Instead of directly purchasing the railroads constituting the direct line, provision is made for leasing these railroads by the new corporation upon terms which are fair and equitable for all parties. The returns to the railroad commissioners show that the average expense of operating the railroads of this State is seventy-five per cent. of the gross income. We therefore propose to set apart for the benefit of each of these corporations twenty-five per cent. of the gross income of its railroad, out of which shall be paid a yearly rental; and that they may not in any event be losers by the experiment, it is proposed to guarantee to them an amount sufficient to pay to their stockholders the dividends they are now paying, with liberty to increase to the maximum which law or custom permits our railroad corporations to pay.
That such a lease would receive the assent of the companies interested, we have strong reasons to believe.
It secures to the stockholders the dividends they are now receiving. It secures also to them the benefit of any increase of business likely to accrue from the completion of the tunnel, to as full an extent as they can hope to benefit by it. No railroad corporation ought ever to pay more than ten per cent. dividends, and the legislature would undoubtedly, under its power to regulate tolls, interfere to prevent greater dividends.
While these corporations are thus interested in the earnings of the roads, the bill provides that they should be represented in their management. We shall thus secure the services of persons familiar with the local business and history of the separate roads, and although forming only a minority of the board of management, they must have an important influence in the direction of its affairs.
The benefits to be gained by the State by this arrangement are obvious and manifold.
It retains state ownership and management of the tunnel.
It secures to all corporations desiring to use the tunnel equal rights.