Public ledger. [volume] (Memphis, Tenn.) 1865-1893, 1879-02-13
Thursday Evening, Feb. is, 1879.
THE STATE DEBT.
Another Meeting Of the B~OndhOlders in
New ork---CharIes 0'ConOr on
the Railroad Lien.

Nav York Times, February sth.l
A meeting of Tennessee bond
holders was held in the Clearinghouse
at noon yesterday, to listen to the re-
port of the committee appointed to
confer with the governor and legisla-
ture of the State in relation to the
funding of the debt. Nj. Charles N.
Fry, president of the Bank of New
York presided. Mr.. Eugene Kelly.
chairman Of the committee, said there
was very little to report. The com
mittee sent a letter to the governor on
the 18th ult., offering to accept new
six per cent. bonds for sixty per cent.
OF the face of the bonds and accrued
interest, or new four per cent. bonds
at par and accrued interest, the bonds
to have fifty years to run, and to be
redeemable at any time on six months
notice, or renewable by the State at
expiration. The governor was re-
quested to submit these propositions
to the legislature, but for some un-
accountable reason he had failed
to do so. The committee had. there
fore, determined tosend General Roger
A. Pryor to Tennessee to advocate
the claims of the b~ondholders before
the new legislature. They were OF
opinion that the State is able to pay
interest on a large amount of its
bonds if not on all. Taxation there is
only one7tenth of one per cent, while
IN Virginia the rate is one-half Of one
per cent. While some Of the bond.
holders thought that their bonds are
a lien on the railroads of the State. the
committee had not acted on that the.
DRY. They thought that they should
not be compelled to look beyond the
State for their money. That would
involve a lawsuit, and would greatly
complicate matters. Some of therail-
roads had settled with the State and
paid the State in bonds. The commit
tee believed that there were in Ten
nessee many advocates for the prompt
payment Of the debt. and they felt
that the question had best be left to
the legislature. Not a dollar had
ever been collected to influence a
member Of that body, nor would there
ever be. The committee intended 10
60 before the legislature with clean
hands, knowing that their cause is
just one and that it is the interest Of
the State to pay its honest debts.
Mr.. p. w. Holmes said that Il
Tennessee is able to pay its debt in
full, the bondholders should force Il
to do SO and should not accept one
dollar less than the amount repre-.
sented by the bonds. There was
suspicion abroad that the railroads
had quietly settled with the State.
He had no faith in the legislature.
If the bo~ndholders gave up theil
bonds, they gave up their lien, and
they would be foolish to do either
II the State cannot pay all. credit
should be given it for what il can
pay and the bondholders should wait
until further payments can be made.
Mr.. Kelly said one of the commit
tee represented 81, 0O0, 900 of bonds.
and the other members had large in.
t%erests, but they had not e their
way clear to suing the railroads.
Whether they would join in suits in
the future was for the future 10 de.
termine. The railroad companies had
said they would not give a fig for the
lien, and so eminent a law firm as
Evarts, Southmayd K Choate hao
given an opinion hat the bondholders
have no lien. Should the people Of
Tennessee take no action, there would
probably be no alternative but to bring
a suit. In the meantime the object Of
the committee was to do the best foI
all interests. Among those it repre-.
sents are widows and orphans who arc
In absolute need Of whatever they cal
get, and savings banks, which may at
any moment find it necessary to real
iEe. As for forcing the State. that
was impossible.
After some further discussion the
report was adopted. Rev. DR.. r.. S.
Moran, who entered the room at this
moment, submitted an independent
proposition which he wished appended
to the other two, so that if they failed
the bondholders might have something
to fall back upon-that was that then
be willing to accept whatever Tennes.
see might feel itself able and willing
to pay, provided the State would agree
to stamp on the coupons the amount
paid without prejudice to the amount
due. Another gentleman suggested
that, to make them effective. the prop.
ositions should be drawn up in the
form of a petition to the legislature
and that all the b~ondholders should
sign their names to it, with the mum.
Der of bonds held by each set opposite.
Mr.. Kelly objected. He said that the
committee did not pretend to control
a majority, or anything like a majority.
of the outstanding bonds, and such a
paper would expose the paucity Of the
holdings represented and greatly in.
lure the movement. He intimated,
however, that the committee had re.
plies in favor Of their plan from rep
resentatives of $40, 1000, 900 Of bonds.
Mr.. John II. Terry said that last