The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1908-12-25
TEXT OF RAILROAD
AID AMENDMENT

|
in relation to government aid to rail
roads, which Governor Frear has draft
ed" said Acting Governor Mott
Smith yesterday, "does not lend the
credit of the government to any
railroad enterprise, as some people
seem to think. 1t merely gives the
Territory the power to do so if it
wants to and the Legislature author
ICES it,. When the power was given to
the Philippine Government to lend its
aid to the construction of railroads for
the development of that country it was
looked on as an excellent thing, a pro-
gressive move. The amendment as
drafted by the Governor simply gives
to this Territory the power that was
gwen to the Philippine Government.
The Territory does not need to exer
else the power, unless it wants to. The
Legislature is the judge IN that matter.
"'That for the purpose Of aiding in
the construction, equipment, operation,
and maintenance of such railroads,
using steam, electricity, or other
power, in the Hawaiian Islands, as the
Hawaiian Government may hereafter
specifically authorize, the said govern
ment is empowered to enter into con-
tract of guaranty with any railroad
company organized pursuant to the
laws of said government or of the
United States or any State thereof
, undertaking to construct, equip, oper-
ate, and maintain any such railroad,
whereby the said government shall
guarantee interest, at not exceeding
! Four per centum per annum upon first
, dc - ha l,xye
pany, properly secured by mortgage or
deed of trust upon the said railroad,
it's equipment, franchises, and other
property, real, personal and mixed,
then owned and thereafter to be ac-
lquired.
t'Such contract of guaranty shall
be signed on behalf of said govern
ment by the Governor thereof, and on
behalf of the railroad company under
taking the construction, equipment,
maintenance and operation of said
railroad by the chief officer thereof,
, thereunto duly authorized by the stock
| holders and directors of the same, and
shall contain, among Others, the fol
lowing provisions:
Z" 'First-That the total amount of
! bonds the interest upon which is to be
9 guaranteed shall in no event exceed the
amount actually invested in cash in
the construction and equipment of
such railroad, to be determined as
hereinafter provided.
'Second-That no debt except as
above provided shall be incurred by
the said undertaking railroad com
pany, it's successors or assigns, by
5 which lien shall be created upon such
railroad, its equipment or other prop
erty, prior to the lien of said govern
ment to secure the repayment of the
{ interest paid by it under said guar
anty without the consent of the Con
gress.
n 'Third-That the said railroad
shall be constructed and equipped
within the time limited in the first
instance by the Hawaiian Government
s. or any extension of said time granted
by said government for good cause
shown.
90 'Fourth-That after the construc
e ton and equipment of said railroad in
accordance with the foregoing provisions
and all others of the contract of guar
anty, the railroad shall apply its gross
earnings as follows:
First, to the necessary operating
v. expenses, including reasonable expenses
of the corporation; second, to the neces
sary and ordinary repairs of said rail
> road and it's equipment; third, to sucl
= betterments and extraordinary repair
of said railroad or equipment as ma.
Il be first by the governor of the islands
U in writing, expressly consented to
. fourth, to the payment of the interes
q on the bonds, the interest ON which t.
4 any extent shall have been guaranteed
II naYf
o this section.
a "'The contract of guaranty shall be i
u substance Endorsed upon said bonds an
signed by the treasurer of said govern
. ment, and the said contract of guarant
q shall not be executed except upon sal
4 isfactory proof of the completion of tn
u railroad in sections of not less tina
D twenty continuous miles each, and
. such proportion, to be fixed from tim
4 to time by said government, as til
4 actual capital invested in complete
road and acquired equipment shall bet
=. to the capital required for the compl
a tion and equipment of the entire roa
to be determined by the said COVER
ment.
All payments made under any sue
a guaranty shall be from the time Il
4 same are paid lien upon said railroa
i and its property then owned and Their
] after to be acquired subject only
. the lien of the mortgage or deed I
4 trust executed to secure the bonds. Il
interest upon which shall have beer
D guaranteed, and the total sum paid u
. der such guaranty shall at the expir
A tion thereof be payable to said Haws
ian government upon demand, and in
fault of such payment the said liz
shall be Immediately forecloseable.
Provided, That in no event shall t
= total annual contingent liability of sa
government under the guarantees a
thorized by this section at any til
exceed the sum of one hundred a.
twenty thousand dollars, and no su
|Ill guaranty shall continue for long
vi period than thirty years.
'ub % For the further security of the II
waiian government said governme
,urt shall declare the proper rules for