The Scranton tribune. [volume] (Scranton, Pa.) 1891-1910, 1902-07-16

| AahS ehc oohuS <Afe SudraCtsrl1eu
as Being Without Merit.
Keen disappointment Is felt in city
hail. and eventually will make itself
generally felt through the city, over
the fact that the siS5,0OO worth of i'm
provements contemplated for this sum-
mer will in all probability have to put
over for a year, as result of Hayes
& Sons failure to take the bond issue
awarded them last April.
The city authorities had planned to
have all the work done this summer.
The preliminaries were arranged early
In the spring and 1t was hoped that
the bonds would be floated early in
May. The city authorities did all they
could to bring about the desired results,
but their efforts promise to go for
naught. Hayes & Sons, seemingly, do
not want the bonds, and as it would
require long and expensive litigation
to compel their acceptance, the likel-
hood is that the bonds will be re-adver-
tised and another purchaser secured.
The city. however, will make stub
born fight to retain the $4,000 forfeit
which the bidders posted to insure
| 'ouipHuilCe Will tuc tcTlllS OIL lnSlT Dlu
in case they were successful.
THE IMPROVEMENTS
The improvements which must be de-
| layed as the result of the Hayes &
Sons back-down and the money ap-
| propratcd for them will be found
among the following items of the bond
| ordinances:
Improvement of Nay Aug park. ..s 5000
Joint fire and police headquarters. 10000
| Phoenix hose house and land ...... 10000
Opening of Irving avenue and Vine
street .............. ................... 3O,4OO
| Opening of Wayne avenue. .w...... 1000
| Opening of MonScy avenue. ........ 4.5C0
| South Side fire and police station. 1900
| Reynolds addition to Nay Aug park 6,4OO
| Purchase of lot in Providence. $50. 2,0CO
| Storehouse for the department of
pubic works ......... ............... 5000
| Improving the fourth floor OF city
| hall NEUTRALITY-SUSPICIOUS.. 5000
| Retaining wall on Third avcnuc.... 11.0CO
| Retaing wall on Yard street........ 100
| Retaining wall OH East Market
| street ............ NEUTRALITY-SUSPICIOUS.. 1,W0
| Iipe drain on Ash street........... $500
| $lS5,COO
The other 100000 provided for in the
bond ordinance is to be applied to the
| liquidation of floating Indebtedness. The
| city is paying six per cent. on this debt,
! and by reason of the delay in cashing
| the bonds is losing two and one half
per cent. interest.
The bonds are 3la per cent. and tax
bearing, the first $4,000 worth maturing
| in five years and the remainder in stat
| ed periods extending over term of
twenty-five years. Hayes & Son offer
ed to take the issue at a premium of
S7O92. The Pttsburg Trust company,
Dick Bros. and Rudolph kleybolte &
| Co., made bids the lowest of which was
| only $500 less than that of Hayes &
| Son. Four other houses made much
| smaller bids.
MADE PREDICTION.
| The agent for one of the latter said
at the time of the opening of the bids
that Hayes & Son would never take
them at that figure. There is scarcely
any market for three and one-half per
cent. bonds, he claimed, and they are
only purchased by bond houses, as
rule, when customer has been pre-
viously secured. Some inconsiderate
houses make it practice to bid very
| high for bonds with the intention of
taking them only in case a customer is
| secured.
| Their high bid secures the award and
| then they start out to peddle them.
| To effect the delay of the delivery of
the bonds they dilly-dally about tech
ncalities. If, finally, they conclude they
| do not want them they will have their
| attorneys find some fault in the bond
| ordinance and send word that they can
t,ly,
| legally issued. 1t is nothing more or
less than getting an option on the
| bonds, without cost, for an indefinite
period. If something happens to make
the bonds marketable the deal is closed.
| If not, the bonds are refused. In the
case Of municipalities the money Is
| urgently needed and instead of trying
to force the option holder to take the
bonds at the end of a couple of years
of litigation, the municipality, smothers
| it's chargin, passes new ordinance and
| readvertises for bids That is what the
| city of Scranton will likely have to do
| in the present instance.
The reasons given by Hayes & Sons
for refusing to take the bonds are
| nimsy according to City Solicitor Wat
son. In fact he contends they have
PRINCIPAL OBJECTION.
Their principal objection is that the
bonds are illegal because the ordinance
provides for IL mixed issue. The state
law says that an item for refunding a
loan and an item for contemplated i'm
provements shall be provided for under
separate and distinct conditions. The
ordinance in question provides for
500, 900 to pay off judgments and Hayes
& Sons contend that this is refunding
"A loan. City Solicitor Watson declares
that the refunding of a loan and the
paying off of floating debt judgments
are two different and distinct things
and stands ready to prove that the
contrary claim of Hayes & Sons is
ridiculous.
Another ground seized upon by Hayes
& Sons for attacking the validity of
the issue is that the statement of in
debtedness filed by City Controller Co.'S
tello is not complete. There Is no merit
in this, City Solicitor Watson says,
because, in the first place the state
ment filed was simply for the infor-
nation of the bidders as to how the
city's finances stood at that time, and,
in the second place, because the law
permits of the filing of this statement
at any time prior to the issuing of the