New-York tribune., 1884-02-25
CORRY,S PECULIAR CITY DEBT.
AN UNFORTUNATE ATTEMPT TO ATTRACT MANU-.
FAcTURERs.

tACIDREHS,
MEADyrLLE. Penn, Feb. 22.-The city of Cor
ry Erie County paid the last nsalment Of debt Of
$4,000 and costs Of long litigation the debt having been
contracted In 1872 under the most extraordinary Ban-
ca policy probably adopted by any corporation In
that year anumber OF the leading Ownsmen anxious
that it might become important manufacturing cen-
re The facilities OF the city such to induce
manufacturers TO locate here, and tho importance of
Cory in industrial pursuits confined to the Gibbs
Sterritt Iron Works and the Cory Furniture Company,
neither Of which prosperous The idea OF Offering
substantial Inducements to manufacturing interests
conceived and approved by the city authorities. The
idea took shape In proposition 70 bond the city and
issue such bonds to persons who wOud establish factories
of any kind that would be beneficial to the place.
The proposition about TO be adopted when some
discovered that such proceeding would be uncon5
utonal the bonding OF cities in the state except for
the payment funding Of debt, expressly for
bldden by the fundamental law Cory, unfortunately
for the plans OF its nancer without debt TO be
either paid funded, and the scheme seemed likely to
20 naught when tho happy thought struck one OF
its projectors that fictitious debt could be created to
provide for which the bonds could be Issued The debt
which debt accordingly created its amount
being placed at Sl35O00 Bonds TO that amount were
issued and $4,000 OF them at used to keep
the struggling Gibbs & sterritt Company its feet.
while S25 900 went to bolster the Cory Furniture Com
pany A manufacturing company with very indefinite
purposes found TO absorb the remaining bonds; but
1t had Insufficient stability OF its own TO keep its feet
until the bonds could be TUNED out OF the city teasdrers
office.
Tho panic OF 1873 followed close this financial ven
ture and the excellent bait OF the city bonds failed
lure any manufactures to Cory. Gibbs X
Sterftt paid back $4,000 OF the $4,000 they had OBJ
tained and the furniture company returned $1,000,
which left S95O00 OF the bonds still outstanding in the
hands OF parties who had purchased them III good ath
sides this discovered that there also in
isence which the city bad paid interest, something
like $4,000 in counterfeit bonds The city, nndi[ itself
in very unenyabe position ceased To honor the cOu
pOns the bonds the ground that the issue ir
regular and unconstitutional To the validity OF the
bonds the National Bank OF Westfeld ChautauqGa
County, n. " which large holder Of the securities
in default instituted proceedings against the city The
not decided until 1850, when Judge MckonHan
the United states Circuit Court, sitting at Erie de-
lyercd opinion uphOdng the validity and legality OF
the bonds He held that 80 long they had been issued
by the proper authorities with the ayOwed purpose OF
paynga debt the disposition OF the proceeds ques-
On Of fact which did not under the consideration
OF the Court, aud If they WrOngfuy used the city
and not the innocent holders OF the securities should
suffer the consequences. IL is said that the cOunelfeter
OF the $4,000 worth OF bonds well known and fIom
the fact that arrests made IL Is supposed
compromise effected in the matter.