The state herald., 1897-10-15
UNION PACIFIC SALE.
TERMS OF THE COMPROMISE
Attorney General Mckcnna Issues State
inent of the Agreement Made Thinks 1t
the best to BE Obtained.

the best to BE Obtained.
Washington. Oct. 9.-Thc attorney
general to-day gave out the following
statement regarding the sale of the I'm
ion Pacific railroad:
"Thcre seems to be a misnpprchen-
sion of the action of the previous ad.
miIistrntion in regard TO thePaciic rail
roads. There WAS no agreement to sell
The roads or The sinking fund of the
Union Pacific.
in consideration of the appearance
of The United States in the foreclosure
proceedings, already commenced. and
the prosecution of It's own mortgage, It
was guaranteed bid of S45. .T95059 at
the sale, which should be ordered by
the court, over and above the amount
of the first mortgage. This amount in
cluded the sinking fund and $2S, S,5O0,-
900 In addition.
There was 10 formal agreement. II
consisted of letters between the reor-
gnnlZation committee and separate
counsel of the government and Attor
ney General Harmon. all OF which
were published In Senate document S3,
Fifty-fourth Congress, second session.
''Thc agreement, MS | have said, goes
no further than to provide for the ap-
pearance Of the government In suits
brought for the foreclosure of the first
mortgage bonds and bringing suit of
foreclosure for its own.
'Thc sale of the property was land
necessarily must be by the direction
of the court. rs in other foreclosure
suits, with the whole world for bid
dcrs.
"The appearance was made and the
suits instituted, as agreed before the
advent of the present administration.
These suits. therefore. II had TO ac-
ccpi, and II has endeavored to secure
such decree rs 1t believed the govern
mcnt under the laws incorporating the
railroads was entitled TO.
1T may be disputable as to whether
The agreement TO 90 into court should
have been made. II is not disputable
ms to what the government. after II
was In the court. could do. There,
like any other suitOr. the government
was subject To the orders of the court.
mean, of course. subject TO the or
lcrs of the court as II creditor. AS
sovereign, its powers could not In NJ
] fectci, and have not been by the de-
crref. We think. therefore, that the
alton are very plain. 1t has not sold
| It's interest. 1t has enabled interests
to be sold ut public auction TO the re-
organization committee. or 10 any com
mittce or 10 any body or association
which. or who. may bid the highest.
I'm what have said | do not mean
to imply criticism of the previous ad-
ministration What 1t did, II no doubt
| lid on mature reflection and in sin:
ccrcst Judgment. and its action was rec
commended by both receivers, who had
been appointed upon the application
of the United States, and was also
unanimously recommended by the hve
government directors.
Now as to the relation OF the gov
crnment to the decrccs: They, as rcil-
dered. were in many respects gratify-
| ing. hut in other respects were not as
the government strcnuously contcnded
| for. For instance. the Omaha bridge
mortgages, amounting 10 about ST.
OO,OO0. were adJudged to be superior
| to the lien OF the government on that
mart OF the road between Omaha and
| Council Bluffs. and. in addition. the
money and assets In the hands or the
receivers accruing from the operation
of the roads Were ordered TO he sold
instead of being reserved to meet n
deficiency judgment expected to be OBJ
tnincd by the government. This
amounted 10 more than S2,OOO,OOO.
This. OF course. would become impor-
tant II the price hid NJ the sale should
not equal the governments lien.
Dissatisfied with the dccrccs. thcrc-
fore. the government considered the
propriety OF an appeal. The rcorgani.
! ZG'lon committee. learning this. came
forward with an Increased bid Of over
si.oOO.0oo. making the total Of their
guaranteed hid s5o.O00.OO9 instead OF
Si5.T5i.059, an Increase Of SI.2i5.9ti.
This increase removed the objections
to the DEGREES. 80 far as the money
contentious Were concerned. In all
else the dccrees We're Just and satisfac.
tory. Under these circumstances nm
appeal did not seem justified.
Regarding n higher bid. the prospect
of II seems MS great now Ms II would
bc later Thcs' considerations deter
mined the government. II must be re-
mcmbcred that the governments lien
i "A Second one-scconh to first mort.
gage OF S.iiOno.OoO. The advantage II
has secured. therefore, is, to repeat.
somewhat that nj the sale under the
docrcrs OF foreclosure there will he n
bid FOR the roads Of fifty millions Of
! dollars over and above the first mort.
gage. aud. besides, the benefit of ali.
soluie freedom Of competition at the
snl". The government may. therefore.
secure It's whole claim through a high,
or bid. II II sure OF $4,000. 600 and
this amount. In connection with the
payments already made. will pay the
| pflutiunl uf fia l.'1t tust..a npnr