The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1897-10-28
Who Eave saved the Government NiI-
lions of Dollars in the Union
Pacific Negotiations.
AN ADMINISTRATION VICTORY
NO BAD FAITH WITH THE REOR-
GAMERS OF THE ROAD.
Recommendations in Secretary Cages
Office LOck-BOx Contract.
speeIal to the IndIanapolls journal.

Special to the Indianapolis Journal.
WASHINGTON, Oct. 27.-The adminis-
tration is in a state of supreme content
ment and satisfaction to-day over the con-
clusion of the Union Pacific foreclosure diff
ficulty To the President attorney general
and secretary OF the treasury is due the en-
tire credit of having forced the reorganiza-
ton committee to terms and compelled the
payment in full of the government claim Of
S5S, 100000 on the main line. or SSOOO,O0o more
than was guaranteed on the main line and
Kansas Pacific together. AS the situation
now stands the government will swing en-
tirely clear of any complications in connec-
tion with the Union Pacific road proper.
and it will have a good show for obtaining
fair amount for its equity in the Kansas
Pacific. The governments claim on this
line is about $lS,OOO,OOO.
Members of the administration deny with
considerable spirit charges from New York
that they took unfair advantage of the re-
organization committee or in any way acted
in bad faith, holding that they kept strictly
within the letter of the law, violated no
agreement implied or otherwise with the
committee and acted throughout with an
eye single to the interests of the people.
They have been in receipt during the last
twenty-four hours of bushels of kilograms
and letters of congratulations. The admin
istration may not be in high favor with the
reorganization committee, but it has made
a great hit with the public, beyond any
question.
Attorney General McKenna explains that
the government Is in no danger of getting
the worst of 1t in the case of the Kansas
Pacific, as the decree of foreclosure speci-
fies that there need be no sale if the gov
ernment claim is not satisfied. Mr..
McKenna, an Associated Press dis
patch says, to-day fully confirmed the
statement heretofore made as to the recent
offer of the reorganization committee and
its acceptance by the government by which
the full amount Of the governments claim
against the main line of the Union Pacific
road principal and interest, is guaranteed.
This amount is something in excess of $5S,-
OO0, 900, and includes outstanding govern-
ment bonds issued in aid of the road to the
amount of s19.O76.1s2. OF this sum $15.9i9,512
becomes due on Jan. /, 1898, and s3,la7.Q5s
on Jan. l, 1899. Whether or not the reor-
ganization committees original increased
bid of $50, 600 900 holds good to proportions
ate share, as to the Kansas Pacific road,
is an open question. The master in chan
Gerry fixed this amount at approximately
s., ,000 000, and the contention undoubtedly
will be that the guarantee offer as to this
amount holds good. This question, how
ever is regarded as of little or no conse-
quence, as it is confidently expected that
at the Kansas Pacific sale which no doubt
will take place on Dec. 10, the reorganiza-
tion committee will bid up to the full
amount of the governments claim, and the
first mortgage bonds Their interest, it Is
said, would compel them TO do this If by,
any chance however, the committees bid
should fall short OF the full amount Of the
governments claim, 1t is almost certain
that the government itself, acting under
authority conferred by the act OF 1887 Will
be prepared to bid in the property. No
such contingency however, it is stated, is
at all likely to arise and the statement is
made from high official sources that the net
result of the deal with the reorganization
committee will undoubtedly be the realza-
ton of the full amount of the governments
claims against both the Union Pacific and
the Kansas Pacific roads.
The next move of the government to-
wards final settlement of the whole bond
aided railroad question, ii is said, will be-
the institution of proceedings against the
Central Pacific road. The government has
contended that this road is already in de-
fault and therefore subject TO foreclosure,
bat in any event, 1t is said the road must
default on the first Of next January. On
the first Of the present month the Central
PacficS debt to the government aggre-
gated $61, S24. .46S of which amount $35, S9,S48
is unpaid interest. In aid of this road the
government now has outstanding SIS, S,S11, ,120
in bonds of which $10,614 120 falls due on
Jan. l next and $9.197,000 on Jan. /, 1893.