New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1896-02-09
PACIFIC RAILROADS DEBTS.
AN INTERESTING HEARING BY THE
SENATE COMMITTEE.
r. E1IERY ANDERSON AND c. p. HUNTINGTON
DISCUSS TERMS OF SETTLEMENT WITH The
GOVERNMENT-TILTS WITH TIE
SIT YER SENATOR'S.


GovERNMENT-TILTs WITH THE
sII YER SENATORS.
Washington Feb S-The Senate Committee on
Pacific Railroads to-day gave another hearing 10
those interested In the settlement OF the deots OF
the Pacific Railroads to the Government Among
those present were Coils ?. Huntington, president
OF the Southern Pacific David II. Litter, represent
ing me Sioux City and Pacific. and Mr.. Pierce
general counsel of the Reorganization Committee on
the Union Pacific.
Senator Wolcott who had not been present al
the hearing last Saturday, when Mr. Pierce ex-
planned the plan OF reorganization, closely ques-
toned the latter the details and purposes OF the
reorganization
Replying to a question relative to the plan Of deal
ing with the sinking fund.- Mr.. Pierce said that iund
was treated being an amount apphcaDie 10 'he
reduction of the debt. The statement OF the dopt
had been excessive 1t amounted, he thought, to not
more than $50 100000 The friends of both the Van
derbit and Gould interests were represented on the
committee Of reorganization. Mr.. Pierce was not
able to say Of his knowledge whether II tho re-
cevers OF the Union Pacific had not diverted the
receipts and earnings they would have been able 10
meet the interest the bonds. Receivers were at
times opposed to reorganization schemes but in this
case he thought the receivers were favorable to a
reorganization. No assistance In the way OF legs-
lation he asserted. necessary to foreclose the
lien Of the Government
When asked by senator WIdt, IL tiic IOtu
were sold. would become of the four Government
directors. Mr. Pierce said he thought they would
out Of Office despite the law requiring their appoint
ment.
Senator Brice remarked jocularly that the Gov
eminent directors would doubt be sold with the
road
Subsequently Mr. Pierce said, in reply TO Senator
Morgan that he could not reach the conclusion that
further legislation was Indispensable, although 1t
might be desirable Mr.. Pierce contended that as
the case stood he believed they could forecose
the first mortgage lien without further legislation.
but there no need of foreclosure; the matter
should be settled by an agreement between the road
and the Government
MR. ANDERSON GIVES HIS VIEWS.
f. E.lory Anderson, one OF the receivers of the
Union Pacific. and formerly Government director.
favored adjustment. but was not prepared. as
Of the receivers, TO adopt any of the plans pro-
posed until he had thoroughly investigated the
subject and knew what the best interests of the
Government demanded. The sale OF both roads
would he was confident. brins less than the prin
cpal and interest Of the Government debt and all
prior liens. The Government held lien on the
Union Pacific representing a certain amount Of
principal advanced and of unrembursed interest
approximatng s53,o00000. after deducting about Sj,
ooOOo now held sinking fund The question
to be answered was What was the Government
lien fairy worth?
Regarding the property of the Union Pacific H.
self as the only source from which anything was
to be expected there two things to be con-
sdered-the available value of the property and the
amount TO be taken out before the Government
cod.d reailze anything; The Government. in sub
originating its lien to the first mortgage bonds
regarded DIS being in the same position as any other
creator. II II desired 10 protect It's Hen, II must
come forward and 90 something. Otherwise the
hrst mortgage bondholders might II they wished
foTecIose The Reorganization Committee had sew
era plans OF settlement with the Government. any
OF which would be acceptable to them, or they
like proposition which might be made 10y the Gov
When Mr. Anderson speaking of the bonds Of
the road Senator Stewart asked, Are you est-
mating these as gold Donds?'
ator. retorted Mr.. Anderson Il not discussing
os a and Of refer G iS IN %
Mr. Anderson said that. taking every thing out in
the D Ys' * bs
worth between S3O,OcVUOV ana 100000 He would
In cash for its claim The Central Pacific and the
Union Pacific If sold together. would, he believed,
offer OF, say, s5oo.ON for the two systems
better. he believed .han any proposition that had
been submiited Tne Two properties together would
In Response TO- a question by senator Brlce
one year with enOher per cent on sl2ecoooc Mr.
| Government is taken up by some person or cor
poraton and properly secured. as frst-mortgase
lien, drawing per cent interest, would be good
proposition Tor the Government TO accept? Would
1t be better than SS500),OcD cash?'
Eyes. | believe it would be the better arrange
ment." Mr.. Anderson replied
Suppose" Mr.. Brice again asked, eve make the
interest per cent, with fair sinking fund. tho
bonds to- run 30 or 100 years. no" would that com
such bond that would be worth
than two-thirds much per cent bond, Mr.
Anderson said. He inclined TO think the
ceptance OF 100000 would be better than the ac
ceptance of tae per cent bond.
STATEMENT FROM c. p. HUNTINGTON.
Coils p. Huntington. representing the Central Pa
cifc road. said he expected some figures from New
York which had not arrived. and he desired TO be
heard at some later date. His request granted
Mr. Huntington said that when he did appear he
desired TO correct some statements which msrepre
persons who did not understand the situation. The
bonds of the Central Pacific sold, he said, for
gold. and gold used in building the road. II the
engineering difficulties encountered in crossing the
Sierra Nevada Mountains had not been almost in
surmouL table. the construction would. ne sad have
much less. This piece OF road l9S miles in
length. extending from Sacramento to the head OF
the rruckee River. offered many more obstacles
sructng this short piece OF road Almost 2V)coo.DO
feet OF lumber had been used in constructing snow
sheds. and he had frequently had ten locomotives
behind a snow-plough and 1000 employed In
fully operated and Mr.. Huntington insisted that II
II had chance IL would ultimately pay its Gov
eminent debt. dollar for dollar.
why did you not use silver, Mr.. Huntington: In
the construction OF your road? asked Senator Nor
gan, jokingly.
Before Mr. Huntington had opportunity
worth cents more than gold, and they used the
cheaper metal
The next hearing by the committee will take place
on Friday. February a.
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