New-York tribune., 1905-02-28
NEW PANAMA R. R. PROBE.
Committee Finds 1t Bought Supplies
for Canal Com mission.

washington. Fet. 2I.-After declaring us III
vestigation Of the Panama Railroad Company
closed last week. the special Subcommittee OF
The House Committee on Interstate and Foreign
Commerce to-day struck new lead which was
pursued with vigor in an examination of Vice
President Z A Drake and Alfred Anderson,
purchasing agent of the road IT appeared that
for six months. beginning early in May of last
year the railroad company had acted as the pur-
chasing agent for the Isthmian Canal Commits
sion. and that supplies worth $4,000 had been
purchased in this manner without public ad-
vertisement for bids.
This is regarded a violation of Paragraph
! Of President Roosevelt's letter Of instructions
10 the commission under date OF May 8, 1904.
which makes it the duty of the commission ITO
make and cause to be executed, after due adver-
tisement, all necessary contracts for any and all
ki1as Of engineering and construction works.
~ detailing to the committee how it happened
that the railroad had made purchases for the
commission. Mr.. Drake said that shortly after
the railroad property was transferred or after
the stock had been acquired and Just prior to
the transfer Of the road TO the government, Cen
egal Davis and Major Brooke required certain
supplies for which they made requisition on Ad-
1nIral Walker, chairman of the commission
"The chairman had recently beenfelected di-
rector he continued, "and was at the office
and. with the general idea that the railroad was
hout 10 become a part of the governments
property, he availed himself of its facilities for
purchasing supplies"
In making these purchases the officers OF the
road followed the practice which always had
been pursued. namely. asking bids by letter
from several firms. In this case list Of eighty
seven firms was made up from much larger
MIST OF firms. and all supplies bought were from
these firms. In emergency cases no bids what
Al -, Of
supplies were paid for directly by the railroad,
after which the commission paid the bills.
While no Instructions received for the
purchase of supplies from any particular firms
from members of the Canal Commission, Mr.
Drake said that the list of firms from which
bids were asked was increased largely by ap-
plication Of others who said they had been told
bx4 members OF Ehe commission to apply. Asked
what members had made such suggestions, he
mentioned Commissioners Grunsky, Herrod and
Hecker.
Did you purchase any lumber III Californian
asked Mr Townsend adding that he understood
that where Mr.. Grunsky was from.
We had bids from California. he repneu'
hut had not accepted any up 10 the time the
matter was taken out Of our hands by MI
Grunsky.'
II was stated later on that an order for be-
tween 2000OO0 and 5OOOOOO feet Of lumber
had been placed on The Pacific Coast by the
Canal Commission. Mr.. Drake said Mr. GruE-
sky had contended that Pacific Coast lumber
Was chea per- and just as good. Mr.. Drake said
bis fifteen years experience with lumber in the
tropics had led him the opinion that the
porous character Of the Pacific Coast lumber
untitled it for in Panama. He understood,
however. that the lumber was cheaper. BIDS
were asked from the North Central states, II
being the policy OF the purchasing department
OF the road TO get its supplies convenient TO the
Atlantic Southern seaboard. Considerable
lumber purchased adjacent TO and shipped
from NeW-Orleans and Florida ports Questions
intended TO develop that the great quantities Of
material bought We're not needed for emergency
work failed Of confirmation by the witness
He said that the specifications for lumber
which had been made through long years Of
Experience regarding requirements on the 18TH
mus were entirely changed by Chief Engineer
Wallace, who adopted the specifications Of the
Illinois Central Railroad and thereby greatly
increased the cost or lumber. Mr.. Anderson,
who made these purchases, gave detailed infor-
nation concerning them
Mr.. Drake in answer to a question whether
he aware of the instructions Of President
Roosevelt regarding the purchase of supplies,
said thar he was and had called the same to the
attention of the Canal Commission Admiral
Walker had told him that the purchases were
not covered by that order they 'emer-
Eency'' requirements. Mr.. Drake maintained
that from - to ;}3 per cent had been saved to
thc government in the purchases made by the
railroad.