New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1897-01-23
FORECLOSURE DIRECTED.
ACTION BY THE CABINET ON UNION
PACIFIC AFFAIRS
THE president APPROVES TIE ATTORNEY
GENERALS AGREEMENT WITH THE UNION
PACIFIC REORGANIZATION COM
MlTTEE-MR HARMONS
STATEMENT.

Washington Jan. OFT was decided at the
Cabinet meeting to-day to begin foreclosure
proceedings against the Union Pacific Railroad
at once The line If procedure will be as indi-
cal ed by the Attorney General in his annual re-
port in which he said in part:
have grave doubts to the ability of the Gov
ernmen. to preserve the present situation nuch
bill passed and accepted the Government should
endeavor to secure terms for Its appearance In
court in the way of assurance of such n bid On
the property i'm Of judicial sale as will secure
to it fair realization Of the value Of It's lien IF
compelled to TO protect its own interests or re-
to b brne Ha sf hp po s SO ns
tanned may he largely lost.
Attorney General Harmon returned from New
York last night fresh from his negotiations with
the Reorganization Committee of the Union
Pacific Railroad Company Prior to the regular
Cabinet meeting to-day he explained to Presl-
dent Cleveland the plan outlined in the state
ment given, which received the Presidents APP
proval.
AS indicated by the statement. the settlement
agreed upon with the Reorganization Commit
tee marks the ending of the relations between
the Federal Government and the Union Pacific
Company. 1t does no. interfere. however. with
the right of the Government to institute pro-
ceedings to protect itself in any phases of the
litigation that may be discovered later SO far
as the Central Pacific Railroad is concerned.
matters are not in shape for settling its relations
with the Government, but something is likely
THE ATTORNEY GENERAL,S STATEMENT
The following statement was given to the
United Associated Presses by Attorney General
Harmon this evening:
Upon the defeat Of the Funding bill in the House.
the President directed the Attorney General to
commence foreclosure proceedings against the
best o6anabe for the the te Of
the, Government's Interests FOLLOWING the lines
began negotiations with the Reorganization Com
mtee. On Thursday an agreement was made
The chief subject the negotiations was the pro
lection OF the Government against the risk of sac
leave nothing substantial after paying prior liens
the aided portions Of the Union Pacac AMI nj Kansas
The sae ' Will S be pnb f" So hat R1s hs
/ Government will receive the benefit OF any higher
and i re the Re s@ a Co. Sa cah Mns
sany ao Ss% York h y ansra s% os
gerald. chairman of the committee, az security. ac-
to ' 5d p of c Se snsns S
Is desired to sell 1t at any time before the fore
Bills in equity have been prepared. signed by the
Attorney General and George Hoadly special coun-
on Friday be presented to Judge Sanborn who ha j
jurisdiction in all the districts. and whose consent
to their filing is necessary because the receivers in
charge of the property made parties defendant
They are original bills. and not cross bills in tho
Whether l, they vii, proceed as independent bills
or be ordered 10 stand as cross bills In the pend
Ing suits will be determined by the Judge. but in
either event the result will be practically the
same-viz.. the sale of the property under the
Governments lien well under that OF the
first mortgage. The bills will be filed in the dis
| tricts of Iowa. Nebraska. Wyoming Colorado and
! Utah. Separate bills for the foreclosure OF the
lien on the Kansas Pacific in course of prepare
ton These will be filed In Missouri and Kansas.
| The proposed arrangement submitted to the
Government directors before it closed. They
all recommended it's adoption. Their general
opinion was thus expressed.
The Government cannot prudently longer defer
the settlement of this matter. The Union Pacific
system has already been much curtailed and its
revenues have been permanently reduced Rcor-
have either been accomplished or are In train
the entire Union Pacific svetcm las Teen and is
steadily progressing II therefore seems to us
inexpedient, II not dangerous. to neglect this op-
portunity Of realizing the sum offered. and thus
expose the Government to continuous deprecia-
tion Of ife security"
1t Is believed that there will be higher bids but
II not estimate shows that. crediting amounts
already received from the company the Govern
mcnt will at least realize sum equivalent to the
principal OF tho subsidy bonds. with interest at
about Is per cent from their issue to the average
date OF their maturity or about 345 per cent from
date OF issue to January |. 1897.
The minimum OF si5. 900 guaranteed to the
Government Is in cash, so that all reat ions with
the property will terminate upon the conhrmato
OF the foreclosure sale
The to be pursued with respect to the
Central Pacific has been determined