Washington standard. [volume] (Olympia, Wash. Territory) 1860-1921, 1898-09-30
THE BOND INTEREST.
SPEC iAL MEETING OF COUNCIL
TO CONSIDER THE MATTER.

The Bondholdcrs' Agent, Barroll,
Again Attempts to Work" the
COuncil-He Receives Some Very
Emphatic Expressions of Orin-
ion Regarding His Methods.
Olympian
An interesting and at times spirited
meeting Of the City Council was held
Wednesday forenoon The full mem
ship and the City Attorney were
present, as was also III. c. Barroll
representing N. w. Harris & Co., the
well-known bond buyers of Chicago.
The object of the meeting was to con-
fer with this gentleman regarding pay
ment of bond interest, which has been
a cause of much worry to the members
of the Council of late years.
That n thorough understanding
may be had OF Wednesdays proceedings
short history of this matter may not
be inappropriate. About six years ago
the city issued bonds to the extent of
S2OO, 1000, the proceeds of the sale to
be devoted to the putting in of sewer
system and for various other purposes.
n. w. Harris e Co. were the pur.
chascrs OF the entire issue, and the
rate OF interest was to be six per cent.
For some years and up to the particu-
larly hard times the interest, $l2, 600 a
year, was promptly paid. Towards
the latter part OF last year it became
apparent to the Council that some
steps must be taken to provide for the
scaling of this heavy interest charge
On December 81, 1897, resolution
was passed by the council to the effect
that the Treasurer be and is hereby
instructed to pay arrears of interest,
or interest that hereafter becomes due,
on bonds at the rate OF three CD per
cent. per annum. On all warrants
outstanding, upon presentation of pay
ment pursuant to warrant call, the
Treasurer Is instructed to pay princi.
pal only of said warrants, making note
OF action and cancelling the same"
AT this time it was believed by the
Council to be simply impossible to
collect enough money to pay the in
terest, and the above action seemed to
that body to be absolutely necessary.
The only way in which the interest
was being met was by borrowing for
the bond interest fund from the general
and other funds. The passage of this
resolution and letters written by the
Mayor to interested parties caused
Harris Il Co. to send to this city a
representative III the person of IL. G..
Barroll, to confer with the Council.
Several meetings were held at which
MIR. Barroll was present and con-
ferences were had, one result of which
was that on May IA Mr.. Barroll sent
to the Council letter of which the
following is the pertinent part:
IT the funds now in
the Treasury are turned over to me
will surrender like amount of coupons
and will recommend to y. w. Harris
X Co., bankers, whom represent, that
they ask the coupons holders to
voluntarily surrender the balance of
the coupons now in default TO the city
without payment, and that they in
duce the holders To consider the said
payment of $4,000 to be in full paw
ment of the $ll,430 interest now due;
and further that all coupons to come
Tor the next five years be scaled to
three per cent"
The letter was discussed Mt length
in the Council, and finally by IA vote of
4 to ) it was agreed to accept the pro
position, although Il concluslon was not
reached without u vigorous protest
from the minority. Right here il
must be said in justice TO the majority
that they were actuated by the belief
that Mr.. Barroll was in position to
carry out all the promises he then
made, The money, $500, was paid
to him, and he departed. For some
little time matters were quiet n re
garded the bond interest, most of the
members OF the Council believing that
the proposition set forth in Mr.. Barrolls
letter had been carried out. Their
surprise was great in June last when
they learned that the $1,000 had not
been pro-rated, and that the difference
between $1,000 ami Sll ,i3O. or $3.50.
was still considered 10y Harris Il co.
As due from this city. Letters passed
between the city officials and Harris
Il Co. ut various times, but no adjust
ment was reached Thus matters
stood until Wednesdays meeting of the
Council, Mt winch Mr.. Barrol WAS
again present rs representative of
Harris d Co.
As soon rs the Council met Mr.
Barroll was granted the floor. lie
started in by saying that his firm were
not the actual holders of the bonds
He said there was n great diversity of
opinion among the bond holders ~ To-
the advisability of making reduction
of interest that there were about 100
of these, and that it was almost i'm
possible to reach them all for obvious
reasons. He gave II as his opinion
that the bond holders would not agree
to the scaling down OF the interest
charge. In concluding his remarks he
submitted three questions to the
Council:
First-Did the Council want him 10
continue correspondence with the
bond holders?
Sccond-What tax, il any will the
city levy to pay the bond interest
Third-WoulJ the city agree t" u
rate of four per cent?
Councilman Murphy criticised Mr.
Rarroll for his mnlnliIlllch nrOmlsCs