New-York tribune., 1886-03-10
EXPOSING MR.. SHAKPo JOB.
PRELIMINARY REPORT TO IHE SENAlE'

ING THE FRANCHISE.
A1RAyY, March 9.-The following Is the re-
o, =, the Railroad Committee OF the senate WHICH WINS
presented TO that body to-day
r., N, Senate ofGe state Of Nuc- York.
rh committee on Railroads to whom wa referred the
resolutions OF the 10th OF January, 1856 charging 'no
committee with duty Of investigating the metuous Vi
the Broadway Surface Railway Company Or other cro
ratons or persons relating to the obtaining o .e co
sert NJ the Buard OF Aldermen and as to the Influences
and inducements that led thereto, and 10 make suV
recommendations as in their Judgment 'no P
interests may require, beg leave 10 sunni. 90
this time a preliminary report OF the results Ill p" "
their Investigation. and especially as TO such in"
Immediately affect the public interests III ''S"'u
v,bcb sneedy legislation is believed TO be requ'eu
Immediately upon the passage OF the salu leso'"t
your committee took measures TO ehp''9 ' aoh
bring before them such witnesses as "eIe "' 80,
., a s,h,mn, and whose evidence wa material an"
pertinent to the inquiry, ana to invite lhe anu an" ~
operation of such persons ana ORGANIZATIONS "
haeved IN bo in posscssion of material facts OF "ho
evinced an interest the prosecution OF an ln'cS's"
ton .. . o,,,,o,o
The investigation of your committee Is not coinpo
7, roma,s to inouire mnre large into the crimihaS
cu,pabty of the individuals composing he BOAR" oi
.ldrmap They have so far made such progress as 10
ne abe 10 report generally upon the subjects referred
10 them and to recommend such legislation as 'ho'
Judgment is Immediately necessary to protect hc pun
lie interests Your committee are unahinous! Vi 'H0
oppon that no ga authority existed for the con-
strucon of the Broadway Surface Railroad OF lot Tue
spa NJ sb res OF stock or bonds The orgdh
zaton OF the company was mere shan' an"
cover to scheme set on 1901 ny uoeiS"'Hs
SPECTATORS in conjunction Win '"o ~
and directors Of the Broadway aud seventh Avenue
Railroad Company for whose benefit In great part tne
organization was formed, aud with which company
nearly all such parties were in some way cnnnec'eo
Their purpose to have been to emUioy tue Ior7
Of to appropriate to themSeves and seize upon the
Broadway franchise the most valuable street raroau
franchise perhaps, the world. and thev sought tms
eud without proper legal authority without the consent
of the property owners Broadway and without max
Ing an adequate compensation to the city therefor.
Your committee wish their conclusions as
sy,deurr II is trne ina; they form made and filed
articles of association, signed hy eighteen huNuHi
persons legal stockholders leg III subscribers TO the
stock OF the company & MTt @ ss m on" r ct IN ca. re-
nuirpd by law upon making his subscription TO e STOCK
for snHlc share Of their stock and snare of
stock ever cut from the STOCK Dooh o
devered to any them any officer or director oi
the road No officer director was eve qualified under
the laws to discharge the duties OF his office; the com
pany never opened subscription books To tha pubic nor
received subscriptions the shares of stock as the law
requires aud no subscriptions were ever % nsuu 90 p1
paid in cash. and no money WAS paid INTO ine essuy
for subscriptions to either stock or bonds save
their subscriptions. Thus the bad faith OF the
scneme apparent from the very OeSSinhnG mn nGG
used in Of the road was advanced 10y
The Of IKE Srsce sGa Spy a S
property cars no horses nor any once OF theIr o"
otpe the consent Of the propertyowners the line
OF Broadway. 1hey had obtained no consent OF the To-
cal authorities--he Board of Aldermen-And had no
shadow of authority for laying down Their tracks IN
that street Their officers ana direetor5 6o were we're
parties and yet At this tine aui on the 3ls
entered INTO a contract with Jacob Sharp by which they
agreed transfer and deliver to him all the stock eH
COZ sideraioh that he should build aud lay down the
tracks the two and onehaf miles Of road from fl
nen "s .1 i }e nm of $1,000 they did actually
execute transfer aud deliver to Sharp $2,500O0O
OF mortgase bonds and 952 shares OF the
500 each being the entire capital stock $50
transaction which your committee believes u
share of stock and of every bond upon the face OF
the transaction Illegal ana vGd sc III m % :.
1t becomes apparent that the properly franchise
became vested first in Jacob sharp the OF the
bonds apa sSoSF xh vsn Cmpay Hs in pr
2etuity. which company, by contract win SHARP
with the Twrnty-ihird Street Railroad Company. aud
became the owners OF all the shares OF stock which
were held In trust by the president OF the company.
These facts the Senate will do well bear III mlnd IN
view of the subsequent PROCEEDINGS with t1e board Oh
Aldermen. as hereinafter VIII appear ana as bearing
directly upon the question Of bribery and the crcum
failed obtain the consent Of the prperyowners on
the street. A storm OF Indignation had been
1t was not believed that disintcrestcd
commissioners would he found that would grant the
priviele OF bnuing the road, and II further under
% Soo n @ ~ The R"rd OF Aldermen 10 give aTay
the franchise. sharp and his fepw-cOn-mraors were.
however. by no means discouraged or dswaytd They
promptly made application To the Boar Of Aldermen
Tor consrnt t. pat down their tracks. and the
day of July, 1884, pr 'scmtrd their applcation 10
to authorize the building of the road The
RESOLUTIONS Of consent we're h,Seo Gsy Of ~ e
lss4 and vetoed by Mayor EGson, and tue
AdeTpr1 from passing the resolutions oyerh" Mayors
veto THIS injunction was bought of on the 18TH diy Of
August by the payment to LJddys attorney OF $1,000
and iu regard 10 which the public had no knowledge At
thi~ juucture eighteen Of ,he Aldermen were suddenly
the 3Otn OF Ausust to pass over the Mayors veto the
resolutions of consent with no timely notice TO
without compensation to the city at time
when s2,0oOOOO aad been % offered Tor the g. fran.
at public auction IL would have in all probability
brought much larger sum. or the means which pro
cured the part OF the Aldermen your
mtIee have but one opinion. and thdt onnOn is that
frst-of their rrfusiDg large that was offered
for the franchise. second-Ihcy rejected the recon-
nenda,ion Of the Mayor OF the city lat It should be
put up ana sold at auction Thri-rhat their action
was directly III the lace ana ~ opposition toa
public opinions and fourth that they assembled together
with indecent haste at an unusual hour Ia the morning
fore tXpayer could serve all INJUNCTION upon them to
restrain their action aud with secret knowedge OF the
cOllusive removal OF tue Lyddy Injunction notice "i
which be served and was served upon them when
consider connection with the above the further sgu
cant Circumstance. that about the time the application
for III" consent made 10 the Board Of AlIermen
the Broadway and Seventh Avenue Company, Ht
considerable sacrifice. suddenly negotiated 100000
OF their second mortgage bOnis. giving a bonus
$4,000 OF their first mortgage bonds for which they re-
ceIved the OF 100000 Instead Of depOsiting the
checks which they received In payment IN banks or
trust panes they turned the whole SUN immediately
into currency In bills aud notes OF from $1,000 TO
$4,000 each large to be used In ordinary traDsac
tiOus" deposited the same III private safe To which
sevrra had OF access and this, bc II
member "a time when the company had no legitimate
the money, either Immediate or prospective;
record of which not carried on the
books cash asset, out under n blind
and misleading entry, aud continued on the books
until nearly thereafter aud until the proceeds
were realized from the sale OF the Broadway surface
bonds No explanation given OF this extraordinary
Transaction, aud the treasurer himself swears that
although tue money put In his possession and
" ~ Il