The herald., 1897-09-24
PROCEEDS
OF BONDS
Provide the Valley Road
With Funds
M'KINLEY'S MIND is MADE UP
TO SANCTION THE UNION PA
CIFIC SCHEME
The Government Will Lose Twenty
five Million Dollars and the Road
Will Be Reorganized
TO SANCTION THE UNION PA
CIFIC SCHEME
Associated Press Special Wire.

Associated Press Special Wire.
SAN FRANCISCO, Sept. 23.-The
purchase of $6OOo,OOO of bonds Of the
San Joaquin Valley railroad made by l.
w. Hellman and the syndicate he repre-
sents was today ratified by the directors
of the company. The syndicate, it is
said expects to sell two-thirds of the
securities and distribute the remainder
among it's members.
About $3,40O, 900 of the cash raised by
the sale of the bonds will be spent south
of Fresno in building 1T miles of road to
Bakersfield by way of Hanford and Vi
salia. The remainder of the money will
be used in constructing a line from
Stockton to Point Richmond and in es-
establishing ferry system between
Point Richmond and this city.
UNION PACIFIC FORECLOSURE
CHICAGO. Sept. 23.-A special to the
Tribune from Washington, says:
1.-THE Union Pacific reorganization
committee proposition for the settle
ment of the company's debt to the United
States will be accepted, the government
mortgage will be foreclosed and the road
sold and the company re-organized.
This statement is made on the highest
authority. For several days past the
President has had conferences with tn"
representatives of the company and
with the Attorney-Genera eral and before
he left Washington he agreed to the sale
of the road and it's reorganization upon
| the basis which the reorganization
committee suggested. The announce
ment of the decision may be looked for
1t an early date. 1t will come in a n order
for foreclosure issued by the President
to the Secretary of the Treasury
"The agreement to which President
Mckinley has decided to give his sane
ton is the same which was submitted to
Congress by President Cleveland last
January. Under this agreement, the re-
organization committee will bid for the
| road under foreclosure sale the sum OF
| $45, 754, ,059. In order to give an intelligi-
BILE statement of what this bid will mean
| to the United States it is necessary to
enter briefly into the story of the Union
Pacific obligation to the government. The
principal of the debt of the Union Pacific
to the United States was $685. 539, ,512. A
portion of this has not yet been advanced
by the United States. The interest paid
by the government amounts to $36, 1854, 1893.
The whole Indebtedness on the first day
of July, 1897 was SO, ,494, ,405. The sinking
fund of the Union Pacific in the hands of
the Treasurer Of the United States on
| the same day was $17,73S,209 After de-
Quoting the sinking fund, which is an
asset Of the company in the hands of the
United States for the purpose of paying
the debt of the Union Pacific Company to
the government, the sum of $28, Ole, $50 re-
mains to be paid. That is the only sum
which Fitzgerald's reorganization COM
| mittee, as it Is known, will be required
to pay the government. The loss to the
government Is the difference between
$50, 100000, which Is the net amount due
the government in round mum bers and
the $2S,000,000, making a loss of nearly
$25, 100000 in round numbers, according
to the figuring of the opponents of tn,
agreement. The agreement for the fore
closure sale also contains provision for
the reorganization of the Union Pacific
Railroad Company and it's Kansas Pacific
branch. The reorganization committee
consists OF Louis Fitzgerald, Jacob H.
Schiff, T. Jefferson Coolidge, Jr Chaun-
cey M. Depew, Marvin Hughitt and
Oliver Ames. The new capitaliza tion of
the new company under the FITZGERALD
plan will be $10OOOO,Oo0. four per cent
bonds. SIS, 900, 600 Of preferred stock, and
SCI, 100000 Of common stock
NOT EVEN DISCUSSED
ADAMS, Mass. Sept. ga great
many inquiries have been received to-
night from different parts of the country
regarding the so-called cabinet meet
ing held today. The queries nearly all
related to the pended settlement of tn.
Union Pacific mortgage.
Secretary Long, in an interview with
an Associated Press reporter, declared
that nothing relating to the Union Pa
ters were talked Of, and the meeting was
one of many private conversations in
which the president and his. cabinet in
dulge when away from Washington.
OFFENsES ADMITTED
CHICAGO, Sept. 23.-At the inter-
state commerce hearing today Local
Freight Agent Lockett of the Grand
Trunk admitted that his company stored
certain classes Of goods for lorg time,
and Local Freight Agent Brinkerhoff
Of the Chicago & Northwestern said that
many times his company had stored
dried fruit and similar freight for fifty
days or over. Other local freight agents
of other companies running into Chicago
testified to the same thing on the part
of their lines At the opening of the
afternoon session Chairman Morrison
announced that as all the witne>e:es
were admitting charges of warehousing
and none of the roads seemed disposed
to deny the charge, it was a waste of
time n taking further testimony, and,
the attorneys agreeing to submit briefs
to the commission. in argument for and
against the right of the railroad conf
panies to grant free storage, an adjourn
ment was taken to Saturday.
RATE REDUCTIONS
SAN FRANCISCO, Sept. 23.-Here-
after the Oregon Railway and Naviga-
tion company, which has entered San
Francisco on rates on par with those