594 Transactions. — Miscellaneous. 



a syndicate called the Patetere Association ; and it was a 

 matter of vital importance to dispose of these lands to the 

 best advantage, or to any advantage. At that time all busi- 

 ness matters were in a flourishing condition. There was a 

 demand for land, and no difficulty was foreseen in the realisa- 

 tion of the property, provided easy access could be estabhshed. 

 Between March and July of 1881 several communications took 

 place between the writer and members of the Patetere Associa- 

 tion with the view of promoting a railway to open up the new 

 lands. This meant a line passing up the Thames Valley from 

 the Waikato-Thames line of the Government to the Manga- 

 karetu Block, or to where Putaruru Junction now stands. 

 This was the first inauguration of the Thames Valley and 

 Eotorua Eailway, into which the proposal at once developed 

 on being placed before the leading Auckland citizens. It was 

 at once recognised that the Government could not m.ove in 

 the making of this line, which was in the first instance 

 avowedly intended to open up large blocks — in all, about 400 

 square miles — of private property ; but the Legislature had 

 made provision for such cases by the District Eailways Acts 

 of 1877 and 1878. Under the provisions of these Acts, on 

 the landowners of a district agreeing to be rated to a certain 

 proportion of the annual cost of a railway proposed to be made 

 through it, and on approval of such railway by the Governor, 

 the Government was empowered to contribute a certain further 

 proportion of income necessary to recoup the shareholders. 

 Borrowing-powers were given, and several lines had at that 

 time been constructed in the South Island under these Acts. 

 As a further means of assisting private railways, an Act 

 was, in 1881, passed through the Legislature, called the 

 Eailways Construction and Land Act, by which, instead of 

 an annual contribution by Government towards interest on 

 cost, waste lands to a value of 30 per cent, on cost of con- 

 struction, not to exceed £5,000 per mile, were arranged to be 

 transferred to the company, which, out of the increased value 

 of such lands, consequent on the making of the railway, was 

 presumed to be able to make a very good investment. 



In the case of our railway it was found desirable to divide 

 the line into two sections, and proceed under the provisions of 

 each of the two Acts. Thus, from Morrinsville to Lichfield, 

 about forty-two miles, was placed under the District Eailways 

 Act; and from Putaruru to Eotorua, nearly thirty-two miles, it 

 was found possible to work only under the Eailways Construc- 

 tion and Land Act. For the first section the lands were all 

 rateable, and the district comprised over half a million acres, 

 including the whole of the Patetere company's lands. Of the 

 necessary land required for endowments for the second section 

 in terms of the Act, the Government held at the time only 



