While things might have seemed good on the surface, there were bad things in the progress of the railroad being finished. There were rises in drops in the progress of extending the railroad, and a telegraph was sent in 1907 saying that they weren't continuing the extension. This was because the workers believed that they were getting insufficient pay. With extension ground to a halt, the railroad was stuck being a 37.52-mile-long railroad from East Branch to Arkville, New York, where it met the Ulster & Delaware. There wasn't enough money being made from the passenger service in the small Delaware County towns, and the railroad was headed straight for bankruptcy. A wreck also took place in 1908. It took place in Arena, New York, where a train had collapsed on the weak rails and sent it into the river below. This cut into service on the line by holding up trains trying to go by. The railroad went bankrupt in 1911, when it had five locomotives, and it was re-organized later that year as the Delaware and Northern Railroad.