The Scranton tribune. [volume] (Scranton, Pa.) 1891-1910, 1900-11-26

AS the result of remarks made at
last Thursday nights meeting OF the
common council by Luther Keller, 1t
is probable that some method Will be
devised in the near future by which
the payment of city engineers esti-
mates furnished to sewer contractors
may be guaranteed by the city.
Asis well known all sewer contractors
are paid by monthly estimates fur
nished by the city engineer. The latter
estimates the amount of work done
on the sewer within the month and
figures up just how much the contrac-
tor Is entitled to at contract price for
that work. From this amount is SUBJ
tractcd the city's share of the cost and
ten per cent extra, which ten per cent.
is retained until the entire sewer Is
constructed.
This estimate is first approved by the
city engineer and must then be ap-
proved by both councils and the mayor.
1t Is then given to the contractor but
is in the majority of instances. as Mr..
Keller said. practically a worthless bit
of paper for all present purposes,
simply because the contractor is gen.
orally unable to negotiate 1t save at a
ruinous rate of interest.
A RECENT CASE.
This means a great deal to con-
tractor who hasn't got very much cap
ital and many of them have been often
times reduced to very dire straits be-
fore they could obtain any money on
their estimates. A recent illustration
of this was the Gibbons case. NJ. j.
Gibbons is the contractor for the
Scranton street sewer and he was re-
Gently unable for a number of weeks
TO raise sufficient money OH his esti-
mates to even pay his men.
The pay roll had run up to over $4,000
and Mr.. Gibbons was unable to raise
any funds. After being bcsieged for
time by his employees he finally sue
cceded, after a great deal Of difficulty,
In borrowing money on his estimates
but was obliged to discount them at
six per cent.
Six per cent. means very big hole
in a mans profits especially when COM
petition Is so close as 1t is among
sewer contractors just at present. Mr..
Keller says that he is convinced that
each and every sewer contractor who
bids on work in this city adds from
fifteen to twenty per cent. more on his
bid than he would If the city guaran-
teed the estimates. This may be lit
tie bit high but the general concensus
of opinion is that u great deal of money
could be saved If the city guaranteed
the payment of the full face value of
the estimates furnished by it.
1t must he understood that the pay
ment of these estimates is derived from
the sewer assessments paid into the
city treasurer's Office by The property
owners along the line of the sewer be-
ing constructed. All sewer ordinances
| contain a clause which reads. THE city
shall use due diligence in collecting
the assessments but shall only be liable
for the amount collected"
CAN WHISTLE FOR TT.
That is to say, if the property owners
do not all pay up and if by neglect the
proper city officials fail to compel them
to do so. the sewer contractor can
whistle for just that much Of his
! money. That is the reason he finds it
hard to negotiate his estimates and
that is why when he does negotiate
them he can only do so at Il high rate
| of interest.
Persons with money to loan won't
take risks. They want to be absolutely
sure of getting their money back and
when they realize that the city only
guarantees whatever money is collected
in the shape of sewer assessments they
insure themselves by discOunting only
| at a liberal rate of interest.
Mr.. Keller believes some plan should
be devised whereby the city could place
its guarantee on it's estimates. 'Then,"
| said he, .'they would be as good as
gold and could be negotiated for their
full face value" He says that it is
done in Pittsburg and could be done in
this city as well. OF course, if such a
! plan was put into effect. it would ne
cessitate the greatest of care in the col
lection of sewer assessments so that
the city would not be out anything.
1t Is Mr.. Keller's idea to have a spe-
cial committee appointed from both
branches of councils to carefully con-
slider this question and report upon it
with such recommendations as the
members might see fit to suggest.
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