Northern Wisconsin advertiser. [volume] (Wabeno, Wis.) 1898-1925, 1904-07-28
NEW YORK cUsToM-HoUsE AL
MOST GIFT TO A BANK.
VERY COSTLY DELAYS
Slow Progress Made on New Build
ing Adds Vastly to the Profits
Of the Standard Oil Concern
Every Years Delay Cuts Cost
100000.


pleted the old building in Wall street
will have become practically a fre'
gift from the United States govern
ment to the National City bank. The
deal through which that Standard o.
banking concern Is to come into
possession of this immensely valuable
property becomes more amazing ex
of each year.
Bids for the purchase of the olo
custom house were opened on July g.
1899. The National City bank was the
highest bidder, its offer being 1926
900. In submitting the bid President
James Stillman outlined an ingenious
scheme, which was accepted by Ly-
man ]. Gage then secretary Of the
treasury, and which has resulted in
immense profit to the bank. The plan
was that the bank should pay into The
treasury all but $4,000 of the pur.
chase price, and that the government
should hold the deed to the property
in escrow pending the payment OF
this sum three years later.
BY means of this arrangement the
government became the tenant of the
bank at $4,000 a year on Aug. q,
1899. when the payment of s3,225,000
was made. The bank had previously
been designated as a government de-
pository, and this money was i'm
mediately turned back into its Golfers.
The transaction was simply a matter
of bookkeeping, so far as the bank
was concerned.
No deed to the property havina
been passed, the real-estate records
of New York county continued to
show the United States as the owner
and consequently the property re-
manned exempt from taxation. This
arrangement, as above stated, was
originally limited to three years, but
1t is still in force. The property is
now valued on the assessment rolls at
s4,500,000, but 1t is not taxed. II It
were the taxes would amount to abou.
$4,000 year.
The bank has received s650,00o
from the government in rents during
the last five years, and has saved
$350,000 in taxes--a total profit of
$l,000,000. In the meantime there
has been vast increase in the value
of real estate in the financial district.
The valuation of $4,500,000 now placed
upon the custonrhouse property by
the TAX department. is the amount at
which II would be assessed ii 1t were
subject TO taxation. This is its true
market value as determined by the
assessors and is s1,235,000 more than
the bank bid for the property five
years ago. This sum, added to the
100000 received in rents and saved
in taxes, makes total of $2.235, 900
which the bank has thus far reaped
from the deal without any reduction
of its available cash.
This total lacks only about 81 600.
goo of the purchase price of the old
custom house, For every year that
the arrangement continues the hanh
will receive a rental of s1S0,000 and
will save $4,000 in taxes, to say moth
ing of the constant increase in the
value of the properly. If these highly
profitable conditions could be main
tanned five years longer the purchas,
price would be completely wiped on,
by the profits, leaving the custom
house an absolute gift to the bank.
Every thing thus far has worked IL
favor of the bank While the oil,
custom house was sold in the summe
of 1899. the contract for the founda
tons of the new building was not lie
until year and half later, Isaac A
Hopper was the contractor. and h
began work Jan. 10, 1901. His cor
tract included the excavation and n
laying of the foundation walls up {
the street level. He aid no. complet
the work within the time agreed upor
and he paid penalty of about $500
for. the delay.
The contract for the exterior wall
and roof was let to John Peircs. HoI
per surrendered the building 10 hin
on April 15, 1909. The time Q
Peirce's contract will expire May
next, Two years and three months G
the time have elapsed and the wor
appears TO be less than half done. t
the layman II looks as though II woul
be impossible 70 complete the 10
within the few months remaining, bu
experts said yesterday that the mos
time-consuming portion of the task
the cutting of the granite at tn
Quarries in Maine-was nearly CON
pleted. and that the execution of tn
contract within the specified time wa
not impossible, Mr.. Peirce is the cor
tractor for the new Hall of Records
which ought 10 have been finislfe
long ago, but is not yet ready for use.
Richard Fourehy, who has Offices !
the maritime building, is looking afte
the interests of the government in tn
erection OF the aew custom house
He referred reporter yesterday Z