1876.] OF THE SENATE. 427

April 17th, 1875, for the half year ended March 31st, 1875.
It did not pay any dividend for the half year ended Septem-
ber 30th, 1875. But why ? The slightest examination of
the financial condition of the Washington Branch, and of
the demands of the State will show the reason.

On the 20th of May, 1875, the payment was made to the
State of Maryland, in settlement of the judgment in the
"Capitation Tax" case, of $424,229.81, and as the further
claim of the State for this tax or bonus, for its charter largely
exceeded all the resources and all the earnings of the Wash-
ington Branch Road, any attempt to pay dividends thereon,
without relief from the State's claims, would not only have
been wrong and dangerous, but would hasten the necessity to
mortgage, and probably lead to the sale of the road in order
to pay the State's claims, and thus lose to the State of Mary-
land and all its owners their whole property in the work.
It must, therefore, be perfectly clear that no dividends could
have been declared at the last usual semi-annual period with-
out a reckless disregard of the interests of the Company.

As much misapprehension prevails on the subject, and as
the public mind appears to be deeply imbued with the convic-
tion, which has been forced upon it by erroneous statements
frequently and continously made, that the investments of the
State of Maryland in the Baltimore and Ohio Railroad, and
in its Washington Branch, have been disastrous to its inter-
ests, and that the tax payers have consequently been thus
subjected to heavy burdens, it is deemed necessary and just
to present the facts

What have been the investments of the State in the Balti-
more and Ohio Railroad ?

First. On April 1st, 1834, the State subscribed for five
thousand shares of the btock of the Washington Branch; five
hundred thousand dollars, ($500,000,) provided a bond hav-
ing twenty-live years to run, with interest at five per cent,
was taken in payment therefor, and as a security in part for
the interest on this five hundred thousand dollars, a bonus
was to be paid for the line from the Relay House to the bor-
ders of the District of Columbia, being for the use of twenty-
seven miles of the territory of Maryland, of twenty per cent,
of the gross revenue from psssengers, between Baltimore and
Washington. The result of this investment has been namely :
A receipt of fifty thousand dollars in stock as a dividend on
10,th December, 1838, and of dividends in cash of $1,625,-
250.00, also for one-fifth of gross revenue from passengers,
$3,327,919-56. A statement is appended hereto, which
shows the actual result, charging the interest paid by the
State on the five per cent, bond taken by the Baltimore and