The morning call., 1894-11-13
IN A REPORT.
Probable Result of Government
Foreclosure.
POSITION OF THE COUNTIES.
They Cannot Be Held Liable for ANY
Part of the Mortgage
Debt.

SACRAMENTO, Nov. 12-The Evening
Bee publishes the following: The report
of Acknowledgement w. Ii. 81. Hart, filed
with the Governor this afternoon, finds
fault with the Australian ballot system,
and says that it is un-American in that it
iIstalls the voter in a booth. 1t also says
that the time allowed the voter in which
to prepare his ballot should be heightened,
the number of precincts increased and a
law passed to punish dishonest officials
who purposely read off the wrong name
from the ballot Attention is called to the
fact that the adoption Of the Australian
system has wiped out chapter IA of the
Political Code. There is now no penalty
attached to illegal voting at primaries.
A statement of the amount advanced by
the Government to the railroad company,
together with interest, is then made, and
attention is called to the fact that some of
the counties were subscribers to the capt.
tai stock Of the Central Pacific. he then
says: IF the bonds are foreclosed and
the roads lid in by the Government and it
pays off the first mortgage. my views are
that the counties would be relieved from
liability.
IF the mortgages on these roads are
foreelosed and the Government purchases
them and takes charge ard controls the
roads would the rates and fares be then so
fixed as to pay the Government the inter-
est on the investment? If so would it not
have the effect of placing a mortgage upon
the products OF the State and every por-
ton of the territory adjacent to the rail-
road lines for such period of time as may
be required to iiQuidate the ndebtedness
by the payment of such rate OF interest
as the Government may charge for the use
of the money invested? If not, would the
whole people Of the United States consent
to be taxed to provide cheap rate for a
passenger and freight traffic on the CON-
paratively local lines between San Fran
cisco and Omaha and not find fault because
they could not all enjoy such advan tages?"
The report then alleges that the Govern
ment aid 10 the railroad in question was a
war measure, and says tnat for this reason
the whole people should contribute toward
its payment. The report goes on to state t:
"In case the Indebtedness of these roads
be refunded by Congress for a period of
fifty or 100 years, will not such indebted
ness become direct charge against the
people of this State and upon those living
adjacent to the lines of these roads and
upon the products and industries of the
people?"
Mr.. Hart then says that any of the
following acts on the part of the Govern
ment would relieve the counties from
liability: A refunding of the debt, fore
closure OF the mortgage and bidding in
of the roads for the amount of the in
debtedness, Congress declaration OF a
forfeiture under the act granting the aid
and assumption of the first mortgage and
operation OF the roads.
In case the Government should tore
close the mortgage and the road be sol
for an amount insufficient to pay the in
debtedness and claims be made against
the countie for their share of the de-
ficiency, Mr. Hart gives it as his opinion
that the counties would, nevertheless, not
be liable. as it was not within their power
to make such debt at the time they sub
scribed 10 the stock.
Continuing, he says: without going
further into details or citing autho rifles,
will say that, in my opinion, the counties
which gave aid as aforesaid in the con.
struction of the Central Pacific and the
Western Pacific railroads will not be Judi
clally held liable for any part of the mort
gage debt due the Government from said
companies"
The report concludes as follows: "I
should be remembered. also. that If the
Government becomes the owner Of these
roads, the amount for which the compa.
MES now owning and operating them are
assessed and upon which they pay taxss
in California would have to be deducted
from the amount or gross value of assess
able property In the State"