The Washington herald., 1907-02-27
STEVENS RESIGNS,
NO BIDS ACCEPTED
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commission TO reject all bids, and the
first question Is whether it shall do so.
The purpose Of the contract was TO Sc
cure. in the building of the canal. the
services OF the best, most experienced.
and most skilled contractors in the coun-
try, at the least risk to them ana the
least expense 10 the government.
Failed of Purpose.
An investigation into the two bids
above mentioned shows that this purpose
Of the government has failed. In each
bid the contractors of experience. whose
personal services in the work are what
the commission has sought, have made
arrangements TO divide the profits under
the percentage bid with bankers and
others TO whom the contractors have had
TO look for the needed capital: so that
the contractors who are actually 10 do
the work have arranged to accept a COM
paratively small proportion of the profits
accrulng under the contract In other
words. the government. by this arrange
ment, is made to pay d high percentage
for the use of capital which il might
itself have furnished at a much lower
rate, while the percentage which the con-
tractors are 10 receive for the real benefit
they are TO confer upon the government
is reduced TO very meager and perhaps
inadequate compensation. No contract
can ultimately operate to the benefit Of
the government IN which the contractors
energy. skill experience. and personal su-
pervision of the work are not adequately
paid for
The defect in the bids which I have de-
scribed. and which our investigation has
made apparent, may be due to defect in
the invitation for bid,, which perhaps
stipulated for too heavy a bond and the
investment of too large capital by the
contractors. or 1t may be because the bid
ders have taken an entirely different view
of the money risk involved from that
taken by the government. Mr.. Stevens,
the chief engineer, who proposed the
form of contract which, with modifca-
tions, was adopted. advises against ac-
cepting either bid. because acceptance OF
either would not, in his judgment, ac-
complish the purpose he sought. The con-
.sideratons stated are by themselves suf-
ficient TO require a rejection OF all bids
and change in the prepared form Of
contract.
Based on stevens staying.
zone Of the chief reasons for adopting
the contract as proposed was that in its
main features it was formulated by Mr..
Stevens. who was expected to supervise
the work as chief engineer. He had had
experience with contracts of this charac-
ter and he had had eighteen months ac-
mol +f... b..
isthmus Less than ten days ago re-
.ceived a letter from Mr.. Stevens. in which
he asked to be entirely relieved from work
on the canal as soon as he could be re-
placed by q competent person, and that
person could become familiar with the
work / have accepted his resignation.
The withdrawal of Mr.. Stevens takes
away the special reason mentioned FOR
proceeding under the present form of
contract
In order TO secure continuity in cngi-
neeTing control and management in the
future I have decided 10 request you 10
assign TO the Office Of chief engineer
Maj. Cocktails, "a member Of the corps
of army engineers. 1t is not my purpose
by requesting this appointment to disturb
in any way the present OTganiza ton on
the isthmus. which Is very satisfactory,
nor 10 interfere with the admirable work
now being done by the present assistant
chief engineer, Mr. Ripley and the vari-
Gus heads OF departments, The work Of
construction is going on well. and viii
continue to do so
The organization already created is
increasing the excavation each month.
and can be relied upon under competent
leadership 10 make further and constant
progress pending period within which
"A new form OF contract can be devised 10y
Mai. Cocktails and his associates. if IL is
deemed advisable to do the work by con
tract. The services Of the same high
class contractors whose bids we are
now rejecting or others OF SIMILAR stand
ing. may then be invoked I'm the interest
of economy and speed
Two Other Officers.
Two other competent members Of the
Engineer Corps. Mai Gaillard and Mai.
Sibert, viii accompany Mai. Goethals to
the isthmus and assist him in MS Iabors.
They viii be appointed on the commission.
Mai. GOethals concurs with Mr.. Stew
ems in advising that all bids on the pres
ent form Of contract should be rejected
Il request the commission to take the
formal action necessary to reject che Ne
Arthur and the Oliver bids, in acceptance
with the power reserved to it in its invita-
tions. Very respectfully, yours.
THEODORE ROOSEVELT
ITO the Chairman of the Isthmian Canal
Commission, Washington, D. c."
There are many interesting features
connected with the rejection of the bids
and the resignation Of Chief Engineer
Stevens Mr.. Stevens was one of the fore
most advocates Of building the canal by
private contract. and as the Presidents
letter explains. il was Mr. Stevens who
proposed the form OF contract adopted
after slight notifications had been made
in it. Recently, however, Mr. Stevens in
dicated that he was opposed TO the CON
tract plan. and he also indicated tina,
should that plan be adhered to. he would
be dissatisfied if the bid of the William
J. Oliver combination was accepted.
Matters Are SimpIiaed.
According TO officials of the administra-
ton, the contract plan was adopted
chiefly at the urgent recommendation of
Mr.. Stevens. and his change OF view in
that connection greatly simplined the
situation and permitted the administra-
ton to reject the bids, which it was
inclined to do ali along.
Maj. Cocktails was dissatisfied with the
form of the proposed contract and frankly
said so to the President He has had
extensive dealings with contractors and
is favorably impressed with the contract
system, but prefers to go over the canal
route and make very thorough examin-
alton of the situation before making any
suggestions as to the manner in which
the canal shall be dug
1t may be. and probably will be. four
or five months before he is ready to give
an opinion
The selection Of Mai Goethals, il was
explained in an official quarter last even