Under the latter provision a railroad cannot reduce its through rates without reducing its locals at the same time. This, no railroad can afford to do, particularly in the eastern States and more thickly populated parts of the country, where the local business is by far the more reliable and profitable. There is no doubt in this respect that the Interstate Commerce Act has been instrumental in maintaining the stability of rates and of great benefit to the railroads and the community.

Many abuses still exist, however, in the commercial management of railroads, which it is difficult for the State to reach, as for instance the intentional delay in the return of freight cars by certain roads, often depriving others for months of their needed rolling stock; the permitting favored customers to use freight cars as warehouses, for days and weeks at a time, without charging demurrage; the reduction of rates to an unduly low point on certain articles, as for instance, soft coal, in order to crush or bring a competitor to terms, with a correspondingly unjust rise after the result is accomplished.

Perhaps the greatest difficulty that railroads, acting in good faith, have now to contend with, is to so adjust their rates, as between each other, that those having the longer routes or poorer facilities shall be enabled to obtain something like a satisfactory share of the business without reducing the rates to a point alike unprofitable to all. The former methods of pooling are now prohibited by law. The adjustment is, therefore, attempted by the stronger roads making to the weaker, concessions, termed "differentials," which are intended to represent as nearly as can be reached, the money value to the shipper or traveler of the superior facilities or agreeability of one route over the other.

Of course these differentials are uncertain as to their results and have to be modified from time to time to correct any unjust or unsatisfactory disturbance of the proportions of traffic to each road brought about thereby.

The uncertainty and unsatisfactory nature of this adjustment is such, however, that, as was indicated in the Report of this Board last year (p. x), a tendency towards the absorption of the weaker roads by the stronger, or of a general consolidation of all railroads in great groups, as in England, is distinctly visible. A circular

letter last summer to the presidents of the railroads of the east, west and north-west, setting forth such a plan, from a prominent citizen of New York, has been the subject of widespread comment and discussion. When and what the outcome will be it is impossible to state, but certain it is that the leaven of consolidation is at work. Many regard such a result with grave apprehension, as likely to produce high rates, poor service, tyrannous disregard of complaints, if not a menace to free institutions themselves. Others, on the contrary, point to consolidations heretofore made, and show that they have generally resulted in lesser and more stable rates, improved service, abolition of unjust discrimination, and confidently assert that what the American people have created they will control.

SUMMARY OF BUSINESS FOR THE YEAR.

A largely increased business on the railroads of the State, as compared with the previous year's business, was again done last year. The total for all roads and the details for each are given with great particularity in the second volume of this Report. A few of the grand totals and most important final results are given here as usual:

*Includes respectively interest and dividends paid by lessors from rentals received from lessees as follows:

Interest...

Dividends.

1888.
$7,569,059 51
3,621,721 42

1889.

$7,417,298 15 3,557,545 00

Figures for 1889 would show more increase but for fact that 69.85 miles of Lack, and Pittsburg not operated during year, and 19.40 of Brad., Eld. and Cuba taken up, are not included in total for 1889.

REFERENCES AND COMPLAINTS.

During the past fiscal year the Board has considered and disposed of 24 references by the Governor, the Legislature and committees thereof, and numerous complaints preferred by cities, towns, associations and individuals, the volume of business having been greater than during any year since the creation of the Board.

The determinations in these matters are to be found in the Appendix pp. 3 to 180, to which reference is made for a full exposition thereof. Many of them are of much importance and involve questions of vital interest to the State.

Your attention is particularly directed to the complaint of the Buffalo Merchants' Exchange against the railroads centering in Buffalo, relative to freight discriminations, to be found on page 72. The gravamen of this complaint was, that the sum of the locals between western points and Buffalo, and Buffalo and eastern points, was greater than the through rates from such western points to such eastern points, thereby cutting Buffalo out from being a distributing center. Great interest was taken in the matter by the leading merchants and shippers of Buffalo.

The Board in its decision recognizes the fact that in many cases the sum of the locals must necessarily be more than the through rates; but in the case of Buffalo, situated as it is at the foot of Lake Erie, at the beginning of the Erie canal, at a point where the service rendered, whether the shipment be through or arrested at Buffalo and sent forward on a new bill of lading, is the same if such shipments are by lake to Buffalo and rail to eastern points, the Board deemed that the ordinary rule should be modified. A similar state of facts with regard to other cities exists, and unless the policy of the railroads be modified as suggested by the Board, the result will be that the centers of business and distribution will be pushed further and further west to the detriment and eventual paralysis of eastern cities - a result that certainly will not be calmly tolerated.

It is proper to add that the complaint was almost exclusively with regard to articles of interstate commerce, and was, therefore, not within the power of this Board to redress. Inasmuch, how

ever, as the subject was one of vital interest to the State, the Board deemed that it could with propriety express an opinion thereon.

ACCIDENTS.

The record of accidents for the year ending September 30th, 1889, shows an increase of 36 killed, and a decrease of 267 injured as compared with the previous year.

The following table gives a record of the accidents classified, first, as to their causes, and second, as to whether beyond the control of the killed or injured, or in consequence of their own misconduct or want of caution, for the years ending September 30th, 1888 and 1889 :

Derailment by broken frog or switch.

Derailment by broken axle

Derailment by broken wheel.

Derailment by defective track..

Derailment by obstruction on track.

Collisions, butting by parting of trains

Collisions, butting by malicious interference.

Collisions, rear, by mistake or neglect of orders or signals.