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MYRTLE AVENUE LINE.
A third track commencing at a point in Myrtle avenue at or near Broadway; thence extending upon, over and along Myrtle avenue to a point at or near Wyckoff avenue.
Terms under Contract no. 4, and the certificates. The lease for the operation of the new subways under Contract no. 4 is for a term of 49 years, beginning January 1, 1917, expiring at midnight December 31, 1965. The lease is subject to termination by the City as to all or any one or more of the lines at any time after 10 years from the beginning of operation under the contract. The certificates for extensions and additional tracks are for a term of 85 years from the commencement of operation thereunder, and are likewise subject to termination as to all or any of the lines at any time after 10 years from the commencement of operation. The certificate for additional tracks provides that in case the rights thereunder be terminated by the City before the expiration of the term, such additional tracks shall not be used by the City or by any other party for railroad operation.
The Company agrees to contribute $13,500,000 towards the cost of construction of the new rapid transit routes under Contract no. 4, including $1,000,000, in lieu of which the Company is to convey to the City in perpetuity all easements necessary for the portion of the Broadway-Fourth Avenue line between Fourth and Tenth avenues, in the borough of Brooklyn, together with the double track railroad already constructed between such avenues. In addition, the Company is to repay to the City the cost of the physical connection between Subdivisions I and II of the Broadway-Fourth Avenue line at Canal street and Broadway. The Company agrees to construct the extensions and the additional tracks of the existing elevated system at its own expense, and to equip the subway under Contract no. 4, and the elevated system, as extended under the certificates, and to so reconstruct and add to the existing elevated system as to adapt them for operation in connection with the new subways, " including therein the elevation or depression in part or in whole of the Sea Beach line so as to avoid grade crossings and the construction of additional tracks where necessary, the construction of two additional tracks to the Brighton Beach line between Church avenue and Malbone street, and the elevation of existing tracks, and the construction of two additional tracks between Neptune avenue and the terminal at Coney Island, the provision of a connection consisting of two elevated tracks from the Myrtle Avenue Elevated line at or near Wyckoff avenue to a point approximately 1000 feet east of Fresh Pond road, the connection of the Myrtle avenue elevated tracks with the Broadway elevated tracks near the junction thereof, the construction of adequate terminal facilities at Coney Island, connecting the Brighton Beach line, as reconstructed, west of West Fifth street, with the Sea Beach line, as reconstructed, near Surf avenue and Stillwell avenue, the extension of station platforms, the increase of station facilities of the stations of the existing railroads, the strengthening of the existing railroads so as adequately to accommodate the equipment, together with all real estate and all trackage rights and terminals, yards and shops."
The elevated lines and subways are to be operated as a single system, at a five cent fare. Free transfers are to be given as re quired by the Commission, at common or connecting points for a continuous trip in the same general direction. The Company agrees to exchange transfers at 86th street, Brooklyn, between the new subway and the existing surface railroad operated on Third avenue, and on Fifth avenue between 86th street and Fort Hamilton. The Company also agrees to endeavor to secure the necessary authority for the extension of such surface railroad to a point in 86th street where a more convenient point of transfer can be installed. The Company also agrees to undertake to make arrangements with the Hudson and Manhattan Railroad Company for the exchange of free transfers at 34th street to and from the Grand Central station.
POOLING OF EARNINGS.
The earnings from the new subway elevated roads and the existing elevated roads are to be pooled, and deductions are to be made for the following purposes:
1. Such rentals actually payable by the Company for the use of the new system as are not included in the operating expenses.
2. Taxes and governmental charges of every description in connection with the system,
3. All expenses, exclusive of maintenance, actually and necessarily incurred in the operation of the system.
4. Twelve per cent of the gross revenue, for maintenance, exclusive of depreciation. Maintenance is to include repair and replacement of tracks and of part of construction and equipment units, but not of the principal part of construction and equipment.
5. For the first year of operation, an amount equal to three per cent of the gross revenue, for depreciation of such portions of the road and equipment as are not repaired or replaced through expenditure for maintenance.
6. Three million five hundred thousand dollars ($3,500,000) to be retained by the Company as representing the average annual income from the operation of the existing elevated roads during the two years prior to the beginning of initial operation, under Contract no. 4.
7. A sum equal to six per cent on the Company's contribution towards the cost of construction of the new rapid transit roads leased to the Company, cost of equipment for initial operation, the actual cost of plant and property for extensions and additional tracks, and the cost of reconstruction of the existing elevated roads. Out of this the Company is required to set aside amounts sufficient, with interest and accretions, to amortize such contributions and such cost.
8. If the Company provides additional equipment beyond that needed for initial operation or additions to the existing elevated roads, the Company is to retain an amount equal to the annual interest on the cost of such equipment and additions, together with one per cent on the cost of the same, to be paid into a sinking fund for the amortization of such cost.
9. The city. is to be paid an amount equal to the annual interest on its contribution toward the cost of construction of the new rapid transit lines leased to the Company, together with one per cent for amortization.
10. In the event of construction of additional lines by the city, which are to be operated by the Company as part of the system, the city is to receive the annual interest on the cost of such new lines, plus one per cent for amortization.
11. One per cent of the gross receipts is to be paid into a separate fund, under the control of the depreciation fund board, and to be invested and reinvested to provide for a contingent reserve fund. The contingent reserve fund is to be accumulated until it reaches one per cent of the cost of construction and equipment of the new rapid transit lines leased to the Company, and it is to be maintained at that level. This fund is to be used to meet deficits in operation and for other purposes.
12. The amount remaining after the foregoing deductions is to be divided equally between the city and the Company.
The Company is required to begin the operation of any part of the new system in connection with its existing elevated lines, whenever the Commission shall declare such part ready for operation. The Company also agrees to equip and operate any extension which may hereafter be constructed by the City, as a component part of the system if such extension is accepted by the Company. If the extension is not accepted, the Company agrees, nevertheless, to equip and operate it on the following terms: From the gross receipts of the extension, deductions are to be made as follows:
1. All expenses of operation, administration and maintenance, including taxes.
2. An amount to be retained by the Company equal to the annual interest payable on the cost of the additional equipment used on the extension, plus one per cent for amortization.
3. A similar amount to be paid to the City upon the cost of construction of the extension.
4. A similar amount to be paid to the City upon the cost of construction of the additions to the extension,
The agreement provides that if the revenue from the extension shall be insufficient to pay these charges, the Company may de duct the amount of such deficit from the revenue of the entire system prior to the payment to the city. If the revenue from the entire system be not sufficient to meet the deficit the lease of the extension may cease, or the Company may continue its operation and the deficits shall be cumulative. In case the revenue of
. the extension meets all the charges then it is to become a part of the original system, and be operated as such.
Should the City terminate the lease of the new rapid transit lines under Contract no. 4, at any time after 10 years from the beginning of operation thereunder and prior to the expiration thereof, then the Company is to receive a percentage of its contribution for the cost of construction of such lines, together with the cost of equipment for initial operation, as set forth in a schedule beginning with 115 per cent of its contribution, to be paid after 10 years, and diminishing by one-thirty-ninth of such percentage for every year that the contract shall be in force after 10 years from the beginning of operation. If the lease continues to the end of its term, January 1, 1966, then the City is to take over the new line and the equipment supplied for initial operation free of cost. For additional equipment of the new rapid transit lines and for equipment of extensions which shall have been in operation less than 39 years at the time of the termination of the lease by the City prior to the expiration thereof, the Company is to receive a percentage of the cost thereof set forth in another schedule, beginning with 107.5 per cent of such cost, if turned over
to the City on the provision thereof, and diminishing pro rata for every year that such equipment should have been in operation, until the 39th year, at the end of which the City is to receive the same free of cost. If such additional equipment which shall have been in operation for less than 39 years be turned over to the City at the expiration of the lease, then the Company is to receive a percentage of the cost thereof set forth in a third schedule, be ginning with 100 per cent of the cost of such equipment, if turned over to the City on the provision thereof, and diminishing pro rata for every year that such equipment shall have been in operation, until the 39th year, at the end of which the City is to receive the same free of cost. The contract provides that if the lease shall be terminated as to the Broadway-Fourth Avenue line prior to the expiration thereof, that the Company shall have trackage rights over the following portions of such line:
Two tracks beginning at a point in the borough of Manhattan near the intersection of South and Broad streets, and extending thence under Broad street and Nassau street to Park Row and under Park Row to a point under the Municipal building; thence four tracks under Centre street to the point near Walker street where the line divides into two branches; thence one branch, two tracks, curving northeasterly under Centre street, private property and Walker street to Canal street and under Canal street to the Manhattan approach of the Manhattan bridge; thence two tracks easterly along and across the Manhattan approach of the Manhattan bridge and along and across the main span of the Manhattan bridge, and along and across the Brooklyn approach thereto, to a point in the borough of Brooklyn at or near the intersection of Nassau street and Flatbush avenue extension; thence two tracks southeasterly under Flatbush avenue extension to a point near Fulton street; thence curving southerly and southeasterly under Flatbush avenue extension, private property, Fulton street and private property to St. Felix street, and continuing under St. Felix street to and under private property and intervening streets to Flatbush avenue, and thence southerly in Flatbush avenue to a point near Malbone street, where a connection can be made with the Brighton Beach line of the New York Consolidated Railroad Company; and the other branch, four tracks, beginning at a point under Centre street near Walker street and extending thence under Centre street to a point at or near Broome street, and thence curving in a general northeasterly direction under Centre street and private property into Delancey street, and thence continuing easterly under Delancey street to the Manhattan approach of the Williamsburg bridge; and thence two tracks over the Manhattan approach to the Williamsburg bridge and over the main span of the Williamsburg bridge to the Brooklyn approach thereto, and thence over the Brooklyn approach to a point where a connection can conveniently be made with the Broadway line of the New York Consolidated Railroad Company in Broadway, in the borough of Brooklyn.