River Falls journal. [volume] (River Falls, Pierce County, Wis.) 1872-2019, 1897-01-28
GOVERNMENT WILL FoREcLose.
Proceedings Against the Pacific Railroads
Ordered Begun.

Proceedings Against the Pacific Railroads
Ordered Begun.
Washington, Jan. 23.--It was decided
II the cabinet meeting 10 begin fore
closure proceedings against the Pacific
railroads at once. The line of proce-
dure will be as indicated by the attor-
ney-general in his annual report.
The following statement was given
out by Attorney General Harmon FRI
day evening:
Upon the defeat OF the funding bill In
the house. the president directs the attor-
ney general to commence foreclosure pro-
oeedings against the Union Pacific Rail-
way company, first making the best ar
rangements obtainable for the protection
OF the governments interests. Following
the lines indicated In his last report the
attorney general began negotiations with
the reorganization committee On Thurs
day an agreement was made which will
result in immediate steps to foreclose. The
chief subject OF the negotiations was the
protection OF the government against the
risk OF sacrifice of its claim by a sale at
q price which would leave nothing substan-
tial after paying prior liens. This protec-
ton is now assured by a guarantee that
the government shall receive on its lien
on the aided portion OF the Union Pacific
and Kansas Pacific lines. including the
sinking fund. not less than $45.554. 900. The
sale will be public. so that the government
will receive the benefit OF any higher bids
up to the full amount of It's claim. principal
and interest. The sum of a, 500. 600 cash
was on Thursday deposited with the United
States Trust company OF New York. by
Gen. Louis Fitzgerald. chairman of the
committee. as security, according to the
terms OF the agreement. The committee
agreed to bid par for the sinking funds. II
II Ia desired to sell II at any time before
the foreclosure SALE
1.-THE proposed agreement was submit
ted to the government directors before II
was closed. They all recommended its
adoption. Their general opinion was thus
expressed:
1.-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. Reorganiza-
ton of allied and neighboring properties
have either been accomplished or are In
train for early consummation. and the
breaking up of the entire Union Pacific
system has been and is steadily progress
ing. IL therefore seems to US inexpedlcnt.
II not dangerous. to neglect this opportu-
Eity of realizing the sum offered and thus
expose the gov eminent to a continuous de-
probation of It's security
''It Is believed that there will be higher
bids. but. II not. an estimate shows that.
crediting amounts already received from
u
realize a sum equivalent to the principal
of the subsidy bonds with interest"
AS indicated by the statement, the
settlement agreed upon with the reor-
ganization committee marks the ending
of the relations between the federal
government and the Union Pacific COM
pany. II does not interfere. however,
with the right of the government to in
stitute proceedings to protect itself in
any phases of the litigation that may
be discovered later. So far as the Cen
trail Pacific road is concerned, matters
are not in shape for settling its rela-
tons with the government, but some
thing is likely to be done in the near
future. The reorganization committee
of the Union Pacific Railway company
consists of Louis Fitzgerald, chairman;
Jacob Fl. Schiff. T. Jefferson Coolidge.
Jr., Chauncey NJ. Depew, Marvin
HugLitt. and Oliver Ames. second.