The record-union., 1898-12-06
This left the Kansas- Pacific case nn.

This left the Kansas Pacific case un-
concluded. BY a decree of the court
in that case an upset price for the
property was fixed at a sum which
would yield to the Government only
s., 500, ,OoO upon its lien The sale at
the instance of the Government was
postponed first to December 10, 1897,
and later. upon the application of the
United States. was postponed to Feb
ruary It, 1898,
Having satisfied myself that the in
terests of the Government required
that an effort should be made to OBJ
tain a larger sum, directed the Sec
retary Of the Treasury, under the Act
passed March 3, 1897, to pay out of
the treasury to the persons entitled to
receive the same the amounts due upon
all prior mortgages upon the middle
and eastern divisions of said road. out
Of any money in the treasury not 9TH
erwise appropriated. Whereupon the
Attorney General prepared a petition
to be presented to the court Offering
to redeem said prior liens in such man
ner as the court might direct, and
praying that thereupon the United
States might be held to be subrogated
to all rights of said prior lien holders,
and that a receiver might be appointed
to take possession of the mortgaged
premises and maintain and operate the
same until the court or Congress other
wise directed ThereuDon the Reor-
ganization Committee agreed that if
said petition was Withdrawn, and the
sale allowed to proceed on February
10th, they would bid sum at the sale
which would realize to the Govern
ment the entire principal of it's debt.
Sc, ,303, 600
Believing that no better price could
be obtained, and appreciatins the diff
culties under which the Government
would labor if it should become the
purchaser of the road at SALE in the
absence of any authority by Congress
to take charge of and operate the road
1 directed that upon the guaranty of a
minimum bid, which should give the
Government the principal OF it's debt,
the sale should proceed. By this trans
action the Government secured an ad-
vance of Sc, 1903, 900 over and above
the sum which the court had fixed as
the upset price, and which the Keor-
ganization Committee had declared
was the maximum which they would
pay for the property.
1t is gratifying to know that the
result of this proceeding against the
Union Pacific system and the Kansas
Pacific line is. that the Government
has received on account of it's sub
sidy claim the sum of S64 751 .223. 70
an increase of $1S.99T, 1915 over the
sum which the Reorganization Com
mittee originally agreed to bid for the
joint property, the Government receiv-
ing it's whole claim, principal and in
terest, on the Union Pacific, and the
principal of its debt on the Kansas
Pacific Railroad.
CENTRAL PACIFIC ROAD
Steps had been taken to foreclose
the Governments lien upon the Cen
trail Pacific Railroad Company, but
before action was commenced Congress
passed an Act, approved July T. 1898
creating commission consisting of
the Secretary of the Treasury. the At
torney General and the Secretary Of
the Interior, and their successors In
office, with, full power to settle the
Indebtedness to the Government grow
ing out of the issue of bonds in aid of
the, construction of the Central Pacific
and Western Pacific bond-aided rail-
roads, subject to the. approval of the
President. No report has yet been
made to me by the committee thus
created.