The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-05-08
Until OnerouS ExactionS in the
Lease Are Removed or
Modified.
THEY SAY BONDS COULD NOT BE
ISSUED.
The Company, Prohibited From
Bonding the Road, Kicked
at a SeaWall.


tors of the railroad yesterday by the State
Board of Harbor Commissioners was not
accepted. Nearly three hours of serious
consideration was given the instrument,
and the result was exactly as those people
who are familiar with Valley road affairs
had predicted. Altogether too much was
expected from the corporation of enter
prising and philosophical citizens who
organized the great enterprise that if not
frustrated is destined to be the salvation of
California, and for that very reason the
directors were compelled to reject the
lease.
The directors met as usual in executive
session, but they gave expression to their
feelings very freely after adjournment, and
said enough to convince their hearers that
speeches delivered during the session
were full of indignation. Every section in
the lease was discussed with due regard to
the equities of the proposition. Except
with two clauses no objection was found
to the lease, but these clauses were of a
nature that made it impossible for the
Valley Road Company to accept such re-
quirements and obligations as were i'm
posed upon it by the Harbor Commits
sioners.
One obligation directly forbade the bond
ing of the railroad, and the other one de-
manded that restraining seawall be built
by the company, which latter proposition
is wholly one-sided and without precedent
in the history not only of San Francisco
but of the State of California.
From all that the directors claim it must
be inferred that the Valley road enter
prise has met with most discouraging OPP
position with regard TO this lease question.
a small band of public-spirited men arose
from the mercantile community of San
Francisco with no other purpose in view
than to free the State from thralldom.
Their motive was not solely selfshness, for
they contributed literally TO the enterprise
they had established. They stood for the
liberty of the people. Such was the burden
of the directors argument yesterday, and
for the same reason it CALLED them to think
that obstacles should be thrown across
their path of development and advance
ment.
hThe State Legislature unanimously, save
for few forgotten politicians, voted for a
lease of China Basin to the Valley Rail-
way for terminus in San Francisco. Ger
tain obligations were imposed on the rail-
way company in the bill, and these were
then favorably regarded by the intelligent
body of legislators and the Valley road
managers. But when the matter came up
before the Harbor Commission this bill
was not enough, and many amendments
were proposed and incorporated in the
lease. so that impossible conditions are
sought to be imposed.
Director Robert Watt spoke on behalf of
the board after the adjournment. In his
voice and manner were plainly discernible
a deep-seated indignation.
''The general sense of the board" said
he, twas that the State in passing the act
had defined what conditions should be at
tached to the lease of China Basin, and
that the State Board of Harbor Commits
sioners introduced, interjected and in
sisted on onerous exactions which would
make the life of the lease very precarious.
1.-The impression is that unless the con-
ditions imposed by the Harbor Commits
won't be accepted by the board of di-
rectors."
"Why won't the lease be accepted,
that is, what are the specific reasons for re-
fusing it?"
sit imposes conditions that are too bur-
densome to be borne. For one thing, it
prevents US from floating bonds, which we
will likely have to do in building from San
Francisco, in which case we will have to
mortgage all the property of the company.
"Now. while there is no reason to think
that there may be any necessity for assign
ing the road, we must provide always for
the worst. Suppose the company should
become insolvent-if we were overtaken by
misfortune. In that case we would be
compelled to bond the road or assign it for
the benefit of stockholders. The condi-
tons Of the lease would preclude us from
China Basin. You cannot bond part of
railroad. People would ask what good is
a road without terminal facilities.
If they could not have a terminus in San
Francisco they would not touch the propo-
sition. The section objected to includes
the phrase "any attempted transfer or as
signment." These words cover a mort
gage. The very act of bonding the prop
erty would be an attempted assignment
The Objectionable clause in this respect
is as follows:
And the said party of the second part does
hereby further covenant, promise and agree,
that it viii not assign this lease, or any inter
est therein, nor transfer to any other person or
corporation any right or privilege conferred on
the party of the second part by this lease, and
that any attempted transfer or assignment,
whether by operation of law, or otherwise,
shall at the option and election of the party of
the first part render this lease void, and termi-
nate all rights under it.
In conjunction with a following clause
about selling out to any person or COM
pany having railway terminals upon or