The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-10-21
BELIEVES A FORECLOSURE TO BE
THE ONLY SOLUTION OF THE
QUESTION.
PURCHASERS EASILY FOUND
COMPETITION MIGHT REIMBURSE
THE GOVERNMENT TO THE
EXTENT OF It's LOAN.

OMAHA, NEBR.. Oct. 20.-The recon-
mendation of the Government directors of
the Union Pacific Railroad that the Gov
erpment liens on the Union Pacific and
Central Pacific be foreclosed and an ar
rangement concluded by which the two
roads shall be run under single manage
ment as through line from Omaha to the
coast, is regarded as the most important
move that has been made on the Union
Pacific checkerboard in years. j. n. H.
Patrick of this city is one of the Govern
ment directors and he regards this as the
best possible settlement of all the diff
culties that have arisen through the con-
nection of the Government with the road.
Mr.. Patrick called attention to the follow
ing clause in the twelfth section of the
Union Pacific charter:
"The track upon the entire line of the
railroad and its branches shall be of a
uniform width, to be determined by the
President of the United States. so that
when completed cars can be run from the
Missouri River to the Pacific Coast"
The board was of the unanimous opin-
ion, said Mr.. Patrick, that the same condi-
tion that existed when this charter was
granted existed now, and that the road
should be made continuous from the Mis-
souri, River to the Pacific Ocean, and
should be operated as one line and under
one company. Never since the compile
ton of the Central Pacific and Union Pa
cific roads had this been done. Several
suggestions were made by different direc-
tors as to the best means of accomplishing
this result and to secure to the Govern
ment the largest amount of its indebted
ness, it being conceded that it would be
almost impossible to recover the full
amount due the Government on it's bonds
and interest, and at the same time obtain
as low capitalization of the through route
as possible in order to benefit all the States
through which it passed.
After careful consideration it was decided
that the prior liens and other liens that
would have to be taken up on the Kansas
Pacific road in order to make it operative
were Of such an amount that the Govern
ment would not be justified in paying
them off ana taking the road.
The directors of course had no control of
any of the side lines of the Union Pacific
system. Their authority only extended 20
the Union Pacific and Central Pacific and
the Kansas Pacific, so it was decided to let
the Kansas Pacific go and to foreclose the
Government liens on the main through
route and in this way acquire possession Of
the whole line. In the bill by which the
Attorney General is authorized to execute
these proceedings minimum amount
should be fixed by Congress which the
Government would receive for its indebt-
edness for such lines, amounting to about
$140, ZOO, ,0O0 The Government could in
tervene in the foreclosure suit now pend
ing or bring another, and the directors
were convinced that at the foreclosure sale
a syndicate would be ready to purchase the
property, pay the first mortgage liens and
pay the Government the amount de-
manded, and perhaps competition would
arise by which the Government would OBJ
tain an even larger amount of the indebt-
edness