Omaha daily bee., 1902-07-22
BOND DEAL IN MIDDLE NOW
FarsOn-Leach's Representative De-
mands HIS Five Per
Cent Interest.

The finance committee OF the Board Of
County Commissioners Is confronted by
an attorney for the Farson-Leach Bond
company Of Chicago, who promises to
make trouble II he can. He arrived yes
terday morning 10 have a conference with
commissioner Harte, Ostrom and Con-
molly, who constitute the committee.
His announced purpose Is Ito prevent
the county from repudlating its interest
obligations" on the 1858, 900 bonds Issued
In 1887, TO run twenty years at 5 per cent,
and the statements he makes are in direct
contradiction Of those made by a member
Of the brokerage firm OF Kelly & Kelly
Of Topeka and New York, which firm
brought about the recent refunding.
The Kelly representative came before
the board In April and proposed that Il
issue bonds for the S26s 900 to run twenty
years at az per cent and to be exchanged
for the present sass. 900 worth of 5 per
cents that expire in 1907 The board
thought the proposition a good one TO ac-
cept, reasoning that Il lie improbable that
a better rate than az could be secured
hve years hence. when the new issue
would have to be made, and that by ac-
cepting this offer IL could save IN per
cent for each Of the next 1--WE years.
The matter was advertised thirty days
and as neither any objection nor any bid
other than Kelly q Kelly's was received.
the board approved the sale to that Arm.
The new bonds we're signed by the county
clerk and Chairman Hofeldt, of, the county
board and were sent to the state treasurer
at Lincoln. What happened after that is a
mystery to thu board. Chairman Hofeldt
said yesterday morning:
'our understanding is that before the
I pau honda naufd h. taLnn- fror, A. .tnto
treasurer ell the old ones would have to
be presented to him. as it was to be an ex-
change. But two weeks ago a telegram
from the Lincoln correspondent OF The Bee
announced that the State Board Of Educa-
tional Lands ard Funds has closed the
transactions for the purchase OF S2eS, 900 OF
Douglas county refunding bonds that they
are taken as an investment Of the perma-
nent school money and that the TRANSACT
ton Is made on a basis Of J per cent
Kelly & Kelly had told us that they held
about 320O, 900 of the bonds and believed
they could get the rest. When this news
came from Lincoln 1t seemed to be assur-
ance that the bonds were all in, but this
Farson-Leach man says that his
company holds 500, 900 Of them, which he
doesn't propose TO give up and on which he
insists on getting the 5 per cent. As the
total was only SSo6,UUO and as there are
known to have been scattered holdings, II
Is quite impossible that Kelly q Kelly
should have had 5000, 900 and the Chicago
brokers 500, 900. 1t is, II we are correctly
informed. still more impossible that tho
state should have secured our new bonds
II the Chicagoans held S100,O 900 of the old
ones. We are quite at sea and will be until
we have Investigated fully"
The afternoon conference did not ma
t~eriallze, as Chairman Harte was the only
member of the committee present. He told
the representative OF the Leach
company that the board considered itself
out of the matter and that the negotia-
tions must be between the Chicago COM
pany and Kelly & Kelly. The attorney
left, with a request that other members
OF the board and the county attorney be
present this afternoon at 4 o'clock to hear
what he has to say. He told a Bee re-
porter that his company own none Of the
bonds now, having sold the 500, 900 It did
own. but that he represents holders OF
about $50. 900. and II the board declines ia
come his way will sue in the United
States court for az per cent (one-hali
years interest) on $4,000. or $4,000.