Regular Dividend

While the major U. S. railroads were last week pleading to Franklin Roosevelt's Fact-Finding Commission that they cannot continue in business without enforcing a 15% wage cut, directors of a little U. S. railroad which has not operated a train or sold a ticket in 89 years met in Adrian, Mich, to pay a $24,000 dividend.

A group of Adrian citizens built in 1836 the Erie & Kalamazoo R.R., linking the navigable waters of the Kalamazoo River with Lake Erie. Only 22 miles long, it was the first railroad west of Schenectady. A pair of horses hitched in tandem pulled the original two-story, twelve-passenger day coach or "pleasure car." When addition of a 20-horsepower, wood-burning locomotive failed to pull Erie & Kalamazoo through ten years of hard times, it was sold to satisfy creditors in 1848.

The new owners promptly leased the right of way to Michigan Southern R.R. Since 1914 New York Central has leased the property, which now forms part of the Central's main-line track between Toledo and Jackson (Mich.). And while the Central has ceased to pay dividends, Erie & Kalamazoo has paid a dividend on its common stock as regularly as most railroads now apply for RFC loans.

At the 103rd annual meeting last week, business was brief and routine. Income for 1938 was $30,000--the annual rental received from New York Central. Taxes, expenses and officers' salaries ate up $6,000. The directors voted to pay out the remainder. Thus, to each of 125 stockholders who own the road's 6,000 shares (par: $50) went an 8% dividend, about the amount they always have received and will receive as long as the Central pays its rent.

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