New-York tribune., 1900-02-07
TUNNEL BONDS ALL RIGHT.
so SAYS THE CONTROLLER AFTER IN
SPECTION.
SPECIAL MEETING OF RAPID TRANSIT
BOARD TO-DAY I'd HEAR THE
COMMITTEES REPORT.
McDonaId'. securities all right;
COMMITTEES

McDonaId's securities all right.
BIRD S. COLER-
The underground railroad seems 10 be assured
The committee appointed by the Rapid Transit
Board Monday to investigate the securities
offered by August Belmont on behalf OF John
B. Mcdonald satisfied itself yesterday that the
securities were adequate, and a special meeting
of the Board has been called for o'clock this
afternoon at No. 800 Broadway to hear the COM
mittee's report. This committee consists OF
President Orr and Controller Coler. They con-
ferred yesterday for some hours with Mr.. Bel
mont. Mr. Mcdonald and their counsel After
the conference over they had little 10 say
for publication. but Mr.. Coler let fall these five
significant words: The securities are all right"
From other sources it was learned that Mr..
BeImont's plan for financing the big contract
viii differ In some details from what gen
orally expected when it was first announced that
he was forming construction company. The
plan has been worked out, it is said. largely by
George W. Wickersham, of No. 40 WaIl-st-. Mr.
Belmont's counsel and A. 3. Boardman and E
NJ. Shepard, counsel to the Board. Its details
promised for publication after to-days
meeting It is said that the definite rejection Of
the Onderdonk bid by the Board removed some
of the obstacles to the completion Of the con-
struction company. some capitalists having now
come to McDonalds aid who would naturally,
have preferred TO back the higher bid
CHARACTER OF THE BONDS.
At the conference yesterday the contractor
and BIr. Belmont specifically stated TO the COM
mittee what sort Of bonds would be offered. The
character of the bonds was considered and dis
cussed. The amount Of cash that would be ac-
cepted, the proportion Of the stock and bonds
Of the company. and the individual securities
were decided upon.
T{eIpoOOt ~ SarTs<v- +Ia cCr71roi+faa
that sureties would be offered that would amply
protect the city. The committee agreed that the
sureties mentioned would be better even than
those Of the surety companies with which Mr..
Mcdonald had been negotiating So favorably
did Mr.. Mcdonald and Mr.. Belmont impress the
committee that they expect all arrangements
to be perfected and the contract TO be signed
within week or ten days.
It may be necessary. however. for the Appel
late Division of the Supreme Court to pass on
the bonds and so alter the conditions that they
can be accepted by the city. Ordinarily. it is
necessary for bondsman TO qualify in twice the
amount of the surety he offers. The desire Of
the Rapid Transit Commission is that this con-
dtion shall not be exacted in this case.
amount of cash will be included in the sureties
large enough TO make the city certain Of per-
feet indemnity. The action Of the court is
looked upon ss merely detail by the Commis
sion, so excellent the sureties that will be
offered. At the meeting OF the Board to-day the
sureties Will be passed upon, and the counsel
may be instructed to prepare the necessary mo-
ton and make it before the court. When this
has been done the construction company will be
organized and incorporated. the bonds will be
offered and accepted. and the contract viii be
signed This, according 10 the result Of the con-
ference. will not require more than week or
ten days
There was an expression Of satisfaction on the
face of John B Mcdonald yesterday s he sat
at his desk
Hear any more rumors about not signing
that contract?' he asked with a smile. It's
about time for another one TO start. But I
guess the whole thing has been put TO rest now.
even If IL was pretty wakeful before. Was 1
worried? Not a little bit knew that 1 could
do il I said when my bid was accepted that
I would qualify and I meant it, I had deal
of trouble with the surety companies but would
have done business with them IL I could Their
demands were too onerous. as you see, and
was obliged to stop negotiating with them.
There is no use in man starting upon such
undertaking as this unless he has more
than string to his bow. I not confined
to the surety companies. and the Commission
knew il. I Will not need all the time that the
me Before the Goth the contract will be signed
and all there will be to do will be TO begin the
work"
CASH IN THE SECURITIES.
1T Will be necessary said Controller COler,
''to ask the Appellate Court 10 allow a little
leeway in the matter Of the bonds As the law
stands. II the Board accepts the sureties that
the new company viii offer they must be twice
the amount OF the bond that the contractor viii
be obliged to furnish. It is the intention Of the
Commission to that the city is perfectly safe
in this matter No securities will be accepted
that might at any time and under any circum-
stances prove unavailable TO the full extent Of
their face value. AS there will be a large
amount Of cash offered. the possibility Of any
difficulty will be small There is no proposition
at present for the city 10 retain percentage Of
the money paid for the work IL progresses.
and do not believe that any such question will
arise The bonds will be ample to protect the
city and thus render such proceeding unneces-
sary."
August Belmont said he would disclose moth
ing OF the business Of organizing the construc-
tion company. now at any future time.
When President Orr was asked If 1t would
be necessary to apply TO the courts for approval
OF the securities offered by Mr.. Belmont, he said:
I am informed that the Controller thinks So
There Is mistaken idea that the Commission
would require surety companies the bond but
the truth Is that the Commission may accept anv
good security There are plenty OF in this
city whose personal bond would be far better Sc
curtty than that of some corporations. The Com
missoners will exercise their discretion business
men We are assured that Mr. Mcdonald Will be
able TO qualify before the 10Th.