towns of Brookline and probably Chelsea, Dedham, and Hyde Park. These pipe lines are all of large size for the transmission of gas, but not for distribution to individual consumers. On June 30, 1901, the Pipe Line Co. had laid mains of the following sizes and lengths:

In the report of the Pipe Line Co. on the date just named the value of its street mains is put at $1,261,449.03, and its total assets at $2,132,664.77. As stated in the same report, the liabilities of this company were $2,101,493.64, of which $1,000,000 was capital stock and $1,085,000 notes, the remainder being open accounts. This $1,000,000 in stock was voted on July 15, 1896, and was subsequently issued and paid for out of the loan of $12,000,000 made by the Central Trust Co. to the Gas and Coke Co. All this was done without the approval of the gas commission, as required by law. In 1898 the matter was presented to the gas commission, and the issue was then approved.

The Pipe Line Co. began to supply gas to the several distributing companies on the following dates:

Figures are available for the quantities of gas supplied by the Pipe Line Co. during the fiscal years ending on June 30 of 1900 and 1901, respectively. For the former year the income of the Pipe Line Co. from sales of gas exceeded its expenses by $10323.30, but interest to

the amount of $29,438.95 was paid, so that there was a deficit of $19,115.65 for the year.

During the year ending June 30, 1901, the income from gas sales of the Pipe Line Co. exceeded its expenses by $100,628.55, but from this were deducted a rebate of $9,809.95 to the Boston company and interest to the amount of $54,274.02, leaving $36,544.58 that might pass to the Gas and Coke Co. as profit. The Pipe Line Co. bought of the Gas and Coke Co., in the fiscal year of 1900, 664,147,400 cubic feet of gas, for which $123,840.10 was paid, and in the fiscal year of 1901, 1,973,731,400 cubic feet of gas, for the sum of $270,614.65. These figures indicate that the average price was about 19 cents, in the earlier, and 14 cents in the later year, per thousand cubic feet. The volume of gas sold by the Pipe Line Co. for the year ending June 30, 1901, was 1,802,178,000 cubic feet, while the seven Boston companies owned or controlled by the Gas and Coke Co. sold in the same period 2,496,368,170 cubic feet. This seems to indicate that the Gas and Coke Co. was unable to supply the demand for gas, in spite of the fact that its projected plant appears to have been completed before the year opened.

After two years of operation by the Gas and Coke Co. it is painfully evident that it cannot even approximate to the estimate of earnings above quoted, which was supplied for the edification of investors.

How much the Gas and Coke Co. may have got for its coke and other residuals of gas production, or what its expenses of operation have been, cannot be stated. On demand of the gas commissioners, in 1900, for a record of the operations of the Gas and Coke Co., as required by statute, the company refused to give any account of its operations on the ground that it is not subject to the statute. No prosecution has followed this apparent violation of the law.

By the present year it is fair to presume that the great volume of securities issued by the Gas and Coke Co. have been largely unloaded on the public, and it is time for further developments, which are not wanting. The Boston Transcript of March 29, 1902, in an article headed "Boston Gas Situation," announced that Henry M. Whitney was practically out of the Boston field, and that plans for a reorganization of the Gas and Coke Co. had been under consideration since July, 1901. A little later the newspapers stated that a receiver had been appointed for the Gas and Coke Co. by Judge Colt, in a friendly suit brought by the United Coke and Gas Co. of West Virginia. In connection with this suit it was stated that there were claims against the Gas and Coke Co. for $2,123,000, of which $230,000 was for defaulted interest on its bonds. In a statement to stockholders and bondholders of the Gas and Coke Co., published by committees of reorganization, in the Boston Transcript of April 7, 1902, it was said:

The company has become burdened by a heavy floating indebtedness. It appears at no time to have been able to earn the interest on its bonds. It has been forced today into the hands of a receiver. . . . . It appears that upwards of six millions of dollars will probably be necessary for the rehabilitation of the company.

Circulars and advertisements, issued on June 18, 1902, over the names of Kidder, Peabody & Co. and J. & W. Seligman & Co., give a plan for the reorganization of the New England Gas and Coke Co., by which its assets are to pass to a new but similar trust to be known as the "Massachusetts Gas Companies." According to this plan the new trust is to issue $30,000,000 more of shares, equally divided between common and preferred. This $30,000,000 in securities is to be issued for the assets of the Gas and Coke Co., plus $3,000,000 in cash.

It is now instructive to view in general the results of the Pipe Line charter. Existing plants were amply able, in 1896, to supply the present demand for gas in Boston at the prices that have since prevailed. Nevertheless, the same millions of fresh capital have been

invested in new plants and pipes, while the old plants have been left idle. Securities based on the Boston gas properties were far greater in face value than either the assets or earning capacities would warrant, even in 1896. In spite of this, nearly $40,000,000 of new securities and debts have since been created, and it is now proposed to add $30,000,000 more, that can only derive an income from Boston consumers of gas. Meantime these consumers wait in vain for the prices that were paraded before the public and the legislature by the promoters of cheap gas. Whatever the motives that influenced the legislators who voted for the Pipe Line charter, their work has proved effective, if not creditable. To criticise the able and public spirited promoters of this scheme would be impolite as well as useless. These masters of modern finance have simply done what most men stand ready to do made a little money in a perfectly legal and easy way. As long as the law permits such uses of property, gentlemen will not be wanting to take advantage of it. As long as the investing public waits on financial miracles, they will be supplied, at a price.

Where not otherwise stated the facts of this paper are mainly taken from the annual reports of the Massachusetts gas commissioners. ALTON D. ADAMS.

BOSTON.

NOTE: Since the above was written events have moved rapidly toward consolidation in the Boston gas field. From the wreck of the New England Gas and Coke Co., as it lay stranded in the receiver's hands, the materials for a new creation, the Massachusetts Gas Companies, were rescued. This organization is a voluntary trust in the hands of ten trustees, and issued at the start preferred shares with a par value of $15,000,000, and common shares to an equal amount - a total of $30,000,000 in securities. The preferred shares draw 4 per cent. per annum and no more, and both their principal and accrued dividends must be satisfied from the assets of the Massachusetts Gas Companies before the common shares are entitled to anything whatever. This issue of $30,000,000 in securities was made in payment for all the property of the New England Gas and Coke Co. except its cash, the stock of the same company, and $3,000,000 in cash. The mortgage held by the Central Trust Co. was satisfied and the Gas and Coke bonds retired, but some other liens of uncertain amount followed the Gas and Coke property into the hands of its new owners. Subsequently it appears that the former plant of the Gas and Coke Co. must have been conveyed to it, as the Massachusetts Gas Companies now hold a mortgage for $8,000,000 on the property of the Gas and Coke Co.

These transactions left the Massachusetts Gas Companies in complete control of the Brookline, Dorchester, and Jamaica Plain gas companies, all three Massachusetts corporations. It now remained to acquire the stocks of the Boston, South Boston, Roxbury, and Bay State gas companies, four other Massachusetts corporations, in

order to control the Boston field. Meantime events favored this purpose. Nearly all of the stocks of the four gas companies last named have been on deposit during some years with the Mercantile Trust Co. as security for issues of about $8,000,000 first series and $3,000,000 second series Boston United Gas bonds issued by a Delaware corporation. Interest on these bonds has been in default for some time back, and the sale of the securities on which they were based seemed imminent. In anticipation of this event the Massachusetts Gas Companies, on January 8, 1903, voted an increase in their stock of $20,000,000, equally divided between preferred and common shares. On February 11, 1903, Kidder, Peabody & Co., acting for the Massachusetts Gas Companies, purchased the stocks held as security for the Boston United Gas bonds, the reputed price being $11,000,000. This sale has been temporarily held up by the courts, but the speedy union of Boston gas interests now seems certain.