Los Angeles herald., 1905-11-02
WATER BONDS IN
GREAT DEMAND
BOSTON FIRM WANTS ENTIRE
FIRST ISSUE
e. M. Rollins g. Sons and New York
Firm Offer Accrued Interest and
Prenium-severa other
Bids Received

"Will the s1,5O00OO issue Of water
bonds conform to the banking laws Of
New York state?"
Until late yesterday evening the
proposition of whether or not the en-
tire issue of bonds could be disposed
of in lump to one corporation hung
on the answer to this question. An af-
firmative meant that e. II. Rollins &
Sons and N. w. Harris & Co. of Bos-
ton and New York would take the en-
tire issue at high premium. A mega
tive meant that only million dollars
worth of the bonds would be taken UP
at this time.
Late last evening c. M. Schomaker,
| the representative of the eastern capi-
talists, received telegram from his
employers stating that they were sat
isfed that the bonds would conform
| to the New York laws and urged him
to secure the entire issue. 1t is ex-
pected that at a meeting of the coun-
Gil to be held at 4:30 o'clock this evening
the bonds will be awarded to the east
ern syndicate.
For the first time in many years and
in many bond issues there were bids
on the table when the hour for open
ing them came at 10 o'clock yesterday
morning. This is partly explained by
the fact that the new water bonds bear
4 per cent interest, while previous is
sues for years have been but 3-4 per
cent.
City's Credit Gilt Edged
The first bid opened was that of the
eastern parties, who formed q pool for
the purpose of taking up the bonds.
When Minute Clerk Wilde announced
that h. II. Rollins & Sons and N. w.
e. N
terest to date of delivery with a pre-
MUM of S15,913 there was mild ripple
Of excitement among the members of
the council, and in the lobby, where
a number of leading business men were
gathered to watch the proceedings, for
it was the first time in the history of
Los Angeles when eastern capital has
bid ravenously for Los Angeles bonds.
1t was taken as an indication of the
high standing that this city has gained
in the financial world and that the
city's credit is gilt-edged.
The next bid opened was one from
w. #. Botsford, a heavy stockholder in
the Farmers and Merchants National
bank. This bid was s1OO,25O for $780,
900 worth of the bonds. Mr.. Botsford
submitted three bids, each for 100000.
The other two bids were $100,S12.50 and
$780, 062.50.
Isaias w. Hellman, president of the
Farmers and Merchants National bank,
submitted four bids, each for $100,0 900.
They were $10O, $3.50, 100000 and $780,
| $50.
j. A. Graves, vice president of the
Farmers and Merchants bank, submit
ted four bids, each for 100000. These
bids were $100,125, $10O, O,312.50, $101, 900
and S100,S75. Accrued interest to date
of delivery of the bonds was allowed
to the city on all the bids as an ad-
ditional premium but the total pre-
MUM allowed on the full million fell
short of the proportionate premium al
lowed by the eastern people.
AT 4 per cent the interest on the ST.
100000 issue will amount to 100000 for
the first year. The issue runs for forty
years and one-fortieth of the issue is
taken up each year, making the entire
| interest to be paid for the full forty
years $1,000, OOO
Interest $1644o a Day
The interest on the issue for one day
of the first year amounts to about
$164.40, and at this rate the premium
allowed by the eastern people will more
than cancel the interest for the first
| three months.
This proposition is one of the most
generous that has ever been offered
the city, and the councilmen We're anx-
ious to award the bonds then and
there.
our bid is for the entire issue, pro-
vided it complies with the New York
banking laws" announced Mr.. Scho-
maker as the council was on the point
of declaring the bonds awarded to Mr..
Schomakers concern.
Dillon & Hubbard, the New York
bond experts, had passed on the valid
ity of the issue, but had said nothing
specific about what bearing the New
York laws had on the case and for a
little while CONSERVATION was rife
among the members of the council.
The case was referred to a commit
tee of the whole and the committee
went into executive session. During
this session City Attorney Mathews
was instructed to warm up the tele-
graph wires between here and New
York city and have Dillon e. Hubbard
state specifically if the issue conhicted
with New York laws. Before a reply
could be secured from this company
Rollins & Sons telegraphed their rep
resentative that they were perfectly