New-York tribune., 1907-01-26
CANAL BID REJECTED.
MAY ABANDON CONTRACT.
Bangs Eliminated d-Another Chance
for OIiUer.
rFro-n The TrIbuns Bureau. ]

IFro-n The Trihuns Bureau.1
Washington. Jan. 25-The government may
decide TO construct the Panama Canal itself.
thus abandoning the scheme OF Chairman Shonts
TO do the work through contractor. Before a
decision to this effect is reached. however It is
probable that all the bids now before the Canal
Commission will be rejected, and new bids asked.
The proposition Of oliver & Bangs 70 build the
canal for Ga per cent Of the total estimated cost
hag been definitely rejected. Should one Of the
new bids meet all the requirements. an award
would. OF course. be made. but experience with
the present bidders has not only led the admin
istration practically to decide that all the pres
ent bids must be rejected. but to fear that the
government may have to abandon the scheme OF
employing any contractor.
The President and the Secretary Of War held
a conference on canal affairs after o'clock this
evening. and the subject was also discussed at
to-day's Cabinet meeting. but definite de-
cision. even to advertise for new bids. has yet
been reached. although that such course will
prove necessary is the present expectation Of
ing the contract.
most Importance to the necessity Of obtaining
an absolutely trustworthy contractor. one who
has ample financial resources, and who takes the
contract at a percentage which will avoid all
loss, as 1t is appreciated that a contractor who
is losing money is the most unsatisfactory per
son possible to deal with. The view is taken
that the actual percentage Is a matter Of less
Importance than the absolute responsibility of
the contractor.
The association OF contractors whose bid has
received the greatest consideration next to that
Of Oliver & Bangs is the Gillespie
company, which offered to do the work for 1213
per cent. This percentage is regarded too
high. although the financial backing Of this
company is regarded as satisfactory. This con-
Germ Is understood to have intimated that were
second opportunity TO bid afforded. IL would
shave It's bid to at least 10 per cent, and possibly
less. Mr.. Oliver is said to have intimated that
II he has an opportunity he will form a new
association with financial backing entirely sat
isfactory to the commission. and 1t is therefore
probable that new bids will be called for.
It is rumored IN some quarters that Mr.. Oliver
will form a new association and submit a new
bid. IL he has an opportunity to do SO. and
that in this way he may be able 70 obtain tho
contract to which his bid Of 644 per cent would
have entitled him had other features OF thc
proposition proved satisfactory.
There is also an intlmation that the Nortl
American Dredging Company. OF Los Angeles
which offered TO do the work for 2S per cent
| appreciated that IL aimed entirely too high ant
would like opportunity TO submit lowe
1 figure. while the suggestion has been made tina
Mr.. Oliver. by forming association with th
company. might be able to comply with all th'
| requirements OF the government
One fact has impressed itself on those WHIT
| have had TO do with the consideration OF tht
bids. and that is that contractor can afford Il
/ do the work as reasonably as the government
| can do IL itself. The reasons for this arr
obvious In addition 20 what might be termed
| legitimate profit. q private contractor must tn
crease his percentage for every risk he Is obliged
to incur. and while the commission has sought q
| devise contract which would reduce the risks
| 20 minimum Il is impossible 70 eliminate tn,
element entirely Moreover. the gigantic size o.
| the undertaking and the necessity Of demand
| ing OF the contractor bond OF 100000 to pro
| tect the government from loss. will apparently
| compel any contractor who undertakes the worl
| TO make some division OF his PROFITS with hi
bondsmen. and this. too. will compel some IN
crease OF the percentage.