The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1879-10-29

loch bill was written byf MT. McCullocn,
and ttiat The bill itself was written in New
York and sent down to B. L. johnson
marked sconfdential,' with instructions to
pass it-without agitation" He also writes
me, that Mr.. RiddlebergerT asserts "that
during the war Virginia, offered to Der home
creditors Virginia Treasury notes ana TO
her English creditors Agotd or tobacco,
through the Englishconstt at Rtchmond."
MIR. Thomas desires me, as member OF the
last Legislature. to state, the facts ln7Teeard
to the preparation OF the bill and the Amen
amendment. and, to examine the proper
sources OF information as TO the payment OF
interest during the war, and give tDe facts'
and make my answer pubic: therefore
address you this communication 10 compli-
ance with his request. j. .:: z.,g
Upon the assembling of the General AS
sembly in Decein Der, 1878, the Governor
transmitted with his message communica-
lions from the Council Of Foreign Bonu.
holders, in London. and from Barring d
Brother, and the Rothschilds and others, m
tended to be responsive to the offer OF the
LEGISLATURE to her creditors contained III
the Bocock. Fowler bill OF the preceding
session.. That offer was TO retund the State
bonds into new. bonds carrying 3 per cent.
for eighteen years and per cent. for thir-
'ty-fwo wears, to be exempt, principal and
interest. from taxation by the State or aHy
county or CORPORATION therein. The answer
OF the creditors, speaking through the
great houses oi bankers and London Ooun-
Gil, was that they would not accept tnese
terms, and it appeared that no creditor
had sienified willingness 10 do so in any
way. The bankers and the London Coun-
ell. however, transmitted through the GOV
ernor certain propositions which they de-
clared the creditors would be will
ing to accept, so far as they were
informed. The Earrings had put out
our foreign loan, and had for q long
time continued to manage it, and it was
we'll understood that any plan of settlement
thew approved could be carried out. The
offer Of the Council Of Foreign Bondholders
was in the form Of bill which they asked
TO be passed, whereby the past-due interest
was to be made capital. and the new bonds
were TO carry per cent. and be non-taXa-
BILE, and the coupons for interest were to he
receivable for taxes and dues of the Stale.
The offer Of the Earrings and Rothschids
was similar, except that the refunded peeier
debt was to bear 81 per cent. After the re-
CENT of the Governors message it became
known that an agent OF Hugh McCulloch
was in the city, and that Mr.. McCullocb,
REPRESENTING the Funding Association OF
the United States Of America, was prepared
to submit a better offer to the State than
either Of those transmitted by the Gov
crnor. For that reason, when the JOINT
resolution was passed inviting the creditors
and their representatives to conference,
Mr.. McCulloch was mentioned by name in
the invitation.
It is a matter OF history, of which the
public prints gave notice ut the time, that
some feeling was engendered between the
Council OF Foreign Bondholders in London
and Mr.. McCulloch because OF bis offer.
saw his offer at the time 1t was made, ana
have a copy Of the paper now. The differ
ence between il and the other offers was
that he proposed to refund the past-due in
terest at per cent. instead OF per cent.
When the conference was had the Council
OF Foreign Bondhoders and the Funding
Association had harmonized their differ
ences, and they united in proposition IN
the shape Of bill providing for per cent.
for five years, per cent. for twenty i've
years, and 5 per cent. for five years, the
past-due interest to be funded at the rate OF
so cents on the dollar in the new bonds,
and the bonds to be non-tayable and inter-
est-receivable for taxes. This bill also pro-
vided for contract with the two asSocIa-
tons 10 do the refunding. 1t may be seen
in the report OF the conference IN Senate
Document No. %. After full confer
ence this proposition was modified so as
to make it per cent. for ten years,
1 per cent. for twenty years, ana per
cent. for ten years. This was the Dill passed,
after several amendments, in the House !;
i l1,t ~ ind
McCulloch for better terms than we would
have gotten without him. know nothing
OF what General L. Il. johnson got as a
confidential communication, but | do not
believe he received anything more than was
handed to me. which Was Dir. McCulloch's
proposal, not in the shape Of bill. The
idea that any scheme to settle the debt
could be passed without agitation Is alb
surd, and could not have been entertained
by sane mind. AS to the Allen amend
mcnt, the facts are as follows:
While the bill was pending in the Senate
a conference was held at the room OF Mr..
Bocock orthe purpose OF uniting on plan
for the protection Of the school fund dll-
ring the period Of refunding. 1t was APP
parent that in meeting the interest on the
new bonds and the accumulated past-due
coupons at the same time the revenues or
the State might prove insufficient il the past
due coupons should come in with rapidly.
Mr.. HenkePs plan was agreed on as the best
which had been presented. when was
called on in the conference for my views i
advocated the Henkel bill, but added tnat
there ought to be supplemental Dill giving
the Auditor the power to borrow money,
and. il necessary, to sell taX-rccelYaDie GER
titicates, to meet the interest on the new
bonds promptly in case the removal OF tue
school fund from his hands and 1lood OF
n,st.due coupons should leave him without
the money to meet The new interest. we
were all satisfied from the report OF the Au-
ditor and OF the House Finance Committee,
and from our own calculations, that tile
revenue Of the State was suhclent 10 sup
mort the government and the schools, ana
nav in addition 4 per cent. on the debt.
Our only difficulty was to provide for tne
past.due coupons, which in any plan Tor
refundipg might interfere with the payment
OF interest on the new bonds until they
were absorbed, which would soon happen,
however. Ny suggestion was adopted, ana
I was asked to draw the bill; which did:
When I showed it 10 Judge Allen; who had
not been at our conference, he approved 1t,
and said he would offer it as an amendment,
as l desired; and he gave notice OF it on
the floor as an amendment he intended to
offer. Itso happened that during the mem
orable struggle on the last Saturday night
OF that session / got the floor at the proper
time, and offered the amendment. would
say that Mr.. McCulloch never suggested
the amendment, and onever saw it before it
was offered. Nor was it suggested by any
creditor or broker, or any one representing
them. In fact, did not see any OF the