The Republican journal. [volume] (Belfast, Me.) 1829-current, 1881-09-08
The Deadlock in the Refundirg Scheme

| EDITOR JOURNAL Truly it is time that the
deadlock in the management of the matter of re-
| funding our city debt should be broken. 1t was
understood last spring that the new city govern
ment would take prompt and energetic measures
to refund the city debt at lower rate of interest
and the city government have used prompt and
energetic measures to bring about such a result.
committee was appointed and it is true that
radical difference of opinion existed among its
members, yet that difference of opinion was not
the cause Of the deadlock, because the committee
reported to the city government plan for refund
ing the city debt, substantially as follows: the
creation of loan under the act Of the Legislature
approved March 9th, 1881 the issuing of bonds for
| the same payable at the option of the city at
any time within forty years from this date with
interest at four per cent. per annum, payable semi
annually, and the conveyance of all the stock IN
the Is ~ NJ K K Co owned by the city of Bel
fast in trust tor the security Of sail bonds This re
port was read and accepted in concurrence by the
city government July 9TH, 1881 But the plan sug
sested IN the above was not adopted by the city
government Upon Investigation it was found that
such a conveyance in trust took away, by force of
law, from the city of Belfast the power which it
has OF controlling the stock which 1T owns IN the
B. a NJ. R r. Co which amounts to nearly five
siXths Of the entire value of the railroad for the
next forty years, and this fact alone objected
toby the city government; but plan adopted by
thecity government substantially the same that
reported by the committee except that it reserved
TO the city Of Belfast the right to the control of its
stock in the railroad. And the Mayor and City
Treasurer were authorized and empowered under
SAID plan to make loan for and on behalf OF the
city Of Belfast for an amount equal to the amount
Of the bonded Indebtedness OF said city for the
purpose OF retiring the bonds OF the city ont
standing and for tile payment of tins loan they were
authorized to Issue the bonds of the city in such
denominations as they might deem advisable, pay
able at any time after ten years from their date
and within forty Years thereof at the option of
said city with interest at four per cent per annum
and the Mayor and city Treasurer were further
authorized and empowered to convey by mortgage
to Israel W. Parker Nathan +, Houston ard WI
liam b SNan, all of Belfast, all the stock both
preferred ANA non preferred III the b. Il Nj. K K.
% now owned by the city Of Belfast in trust to
secure the piymsnt OF sad binds and interest
thereon, TtStENlNS Ill Adl'l mortgage the fISHt
to the city Of Belfast to represent said stock
i'll all Stockholders meetings Of said Il co.
as tally as if no mortgage had been glveu uu
til said CITY Of Belfast should lose its right
to redeem said m ,rtgage also to execute the
proper declarations OF trust with the trustees
and said Mayor and city Treasurer further
authorized and empowered To sell said bonds
at not less than their par value and with the
proceeds arising from such sale to purchase
said outstanding bonds at their par value or to ex
change any Of said bonds for an equal amount of
said outstanding bonds and they also fnr
Their authorized to procure the necessary blanks
for said bonds and the registry for bonds issued
This is what the cay governm mt has accom-
pIished III the matter of retundlug the city debt
Whit more could orcan they do There has been
no declaration Of trust executed, no bonds have
been offered for sale exchange, and not even the
necessary blanks for sand bonds procured i'll nbed
ence To the direction Of the city government
This is certainly not the fault Of the city govern
ment But must be the fault OF those who have
been authorized to perform said duties Why have
moi these duties been done by those who alone
were authorized to ito them Because the lnonled
powers the banks in the city Of Belfast informed
the Mayor that they could not lend their assist
ance 70 the plan of retnnding adopted BY the city
because the citys stock was not taken entirely
from its control and placed i'll the hands Of trus
tees with power To represent the same in all stock
holders meetings Tins Information was laid be
fore the city government but after consideration
thereof they did not tit to change their course
| ann Nav V,.f 1IthhrtIA1 tn. "A
treasurer to Stay proceedings Nevertheless they
have and still continue to 10 50 II there Is a
deadlock in the retundlng scheme who is RESPONSE
bic for it why 10 not the parties authorized by
the city government to refund proceed Why
this stay in the proceedings Does their authori
ty IN thls matter come from the city government
Or from the banks Ii 1t comes from tile city
government then their delay IS censurable, tor the
summer IS ended and the time for borrowing
money at 4 low rate Of interest has passed Money
is now in demand, and the borrowing rates at the
banks have nearly doubled 50 says Fair Play
Bat If their authority comes from the banks, the
monied powers. then their course is consistent anC
they haze done their duty to them For let it be
remembered that the gentlemen who represent
and control the twu banks in this city with theiI
immediate supporters are the identical men who
represent and control the railroad and "ho now
| Seek /" control the municipal affairs OF the city
They also largely Of the preferred stock in
the 3. 4 n K L Go. Bat what connection has
the management Of the railroad with the refund
ing of the city debt II the city. interest in the
railroad should not be pledged as security to the
bonds it would be liable for the payment OF the
bonds any other property within the city,
whether it be public or PRIV ate But the city a.
evidence Of its good faith offers to pledge all OF
its interest IN the railroad stock to its bonds
reseryng only in themselves the right to contro
in the infringement Of the railroad affairs, which
reservation i'll no way lntertres with or impairs
the security offered Aud TINS reservation they
make for very good reasons, some Of which wl
appear farther on.
In Fob 1861, TIE charter for the b a Nj K Il
was granted By the legislature, and during the
same ear the company formed The idea
prevalent and IN fact incorporated INTO the
charter Of the rairoAI. that there shoalI be tw,
kinds OF stock designated preferred and non
preferred and that the towns Interested in the road
should subscribe .or the non preferred stock
On tile first IAy o. April. 1857. the city of Bel
fast, by its city government, unanimously passed
the following resolve, which afterwards IN
corporated into the subscription contract entered
into by the city OF Be Hast. viz
Resolved, That it is the sense OF the city GOV
eminent that the construction of the railroad from
Belfast to Newport. should not be commenced till
the means have been secured to colnp etc the
same to Newport exclusive Of the rolling stock
and that no mortgage other incumbrance shall
ever be placed upon said road
On the 9TH day Of april following, the inhabi
tants OF Belfast voted to subscribe for }t0t shares
Of non preferred stock. On the 1th Of August Of
same year. the city government Of Belfast voted
follows
That the municipal officers be and they are here
by aut horized and instructed TO subscribe in the