The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1894-07-22

basis Accordingly. the committee directed
its Efforts 10 a plan looking to the extin-
guishment OF the lien, and by the Dill the
amount In the sinking fund IS applied 10
that purpose upon condition that the COM
panies shall provide in manner satsfac-
tory to the Secretary of the Treasury for
the payment of the remainder OF the bonds
and the discharge of the first mortgage,
giving the government a first instead or
SCI md lien on the property; disposition OF
the sinking fund considered more advan-
tageOus to the United States than its ap-
plicatiOn as credit on its own debt.
The committee considers the arrange
ment advantageous to both parties; that
il is within their ability TO comply with
the provisions of the bill, and thinks the
companies will willingly comply If they
are disposed toward a settlement. The gov
eminent must continue 10 pay interest on
the subsidy bonds until their maturity and
the bill provides for the method of ascer-
tanning the amount due the government on
the 1st OF January. 1895 and that bonds of
the companies TO run fifty years shall be
given for that amount. bearing per cent
interest, payable semi-annually. with semi
annual and gradually increasing payments
on the principal. The bill cOntemplates set
ting the extent of the government lien.
and includes in the mortgage the valuable
terminal properties OF the Union Pacific
at Omaha. Kansas City and other points,
estimated to be worth Sl5.Oo0,OOO. There are
ether provisions covering the payment OF
dividends by the companies 50 long as the
tnited states shall own any bonds, for
payment for transportation services and
Tor preserving other rights of the United
states. In case of default in respect 10 any
obligation for which any lien exists in IA
vor of the United States upon any prop
erty or any other companies or in case or
any proceedings brought by holders of any
ether lien, the Attorney general Is author
lied to enforce the claim and foreclose
any lien of the United States by sale or
otherwise. and. If by sale. the property
shall be sold to the highest bidder for
sum not less than the amount of the debt
due to the United States and all interest
thereon 10 the date of the confirmation of
the sale; and the Encouragement is au-
th0r1Zed to bid such amount in order to
protect the government. Purchasers and
their associates shall be invested with all
the property and franchise upon confirma-
ton Of the sale by the court and compli-
ance Herewith, and upon filing certifi-
cate accepting the provisions of the act,
giving the name under which the company
is to be organized. naming fifteen directors
and making all the laws relating TO the
government directors apply to the reor-
ganized company. The Court of Appeals
of the District of Columbia is given jurls-
diction over legal proceedings.
Unless some adjustment Is effected Mr..
Reilly's report concludes, foreclosure seems
inevitable. and that might involve the ne
cesSity of the government being compelled
in order to protect itself TO pay off the
first mortgage. thereby involving an addi-
tional outlay of public money on the roads
of over forty millions above the sinking
fund, which would make the aggregate of
the governments investment about $170,
600 COO