New-York tribune., 1908-09-06
TRACTION REFERENDUM.
Smt Charges Mayor Johnson and
Other Officials 1rith Fraud.
by Telegraph to Th. Tribune. !

Cleveland. Sept. 5.-Faced by a financial crisis
in the operation Of the Cleveland streetcar lines
at a 3-cent fare by the Municipal Traction Com
pany. in which he is the controlling force. Mayor
Tom L. Johnson in a special session of the
Council to- night had himself authorized to call
a special election for October %. in which the
franchise under which the company is Operat-
ing by lease from the Cleveland Railway Com
pany is to be submitted to the voters.
The Mayor had fought calling the election.
demanded through the efforts of the striking
streetcar men, but a question OF the legality of
the franchise until II had been ratified. which 1t
was feared would result In the refusal of the
Cleveland Railway Company. owner of the fran
chise, to issue stock to raise money needed by
the Municipal company. caused his change OF
front.
To add to the intricacies of the situation. a
suit was filed in Common Pleas court to-day by
James K Farasey, taxpayer, asking that the
security grant of the Cleveland Railway Com
pany be declared null and void and the lease
of the PROPERTY to the Municipal Traction Com
pany be set aside Fraud in financial interest
by city officials is named as basis for the
suit The petition declares that the Municipal
Traction Company is fraud upon the city and
its taxpayers, without legal or financial respon-
sibility and wholly and solely controlled and
dominated by Mayor Johnson.
It is further declared that the franchise grant
is fraud because it provided higher rate Of
fare than had been offered by the Cleveland
Electric Railway Company Ct seven tickets for
- cents with universal transfers It is averred
that the public funds of the city were used to
promote the interests of the 3-cent fare lines.
Five hundred thousand dollars is named the
sum so used.
1t is charged that the West Side pumping sta
ton, valued at s1.5OoOoO. was leased to the
Forest City Company at an inadequate rental
and that land adjoining was purchased at
cost of S6SOO0 out of the water works FUNDS
and is now being used by the railway company
OF the organization of the Municipal Traction
Company II is charged that the original drec-
tors of the company were selected by the Mayor
and that they were at the time Of their election
mere tools and puppets of the Mayor agreeing
with him that all that should be done IN the
operation Of the company should be in further
nca ~ his scheme and plan to control the street
railway system
II ts alleged that these original incorporators
and directors of the company had no personal
interest in the company and though pretending
to subscribe $4,000 of the capital STOCK OF inc
company, not one OF them was the real owner
of single share of the stock.
II Is charged that prior to April q last, Wnen
the security grant was passed by the Clty CouL-
Gil the Municipal Traction Company ana tho
Forest City Railway Company were creditors
and depositors in the Depositors' Savings and
Trust Cornpanv. of which Mayor Johnson was
nresident and Vice Mayor Lapp and Council
men Zinner Hanratty and Henry stockholders
It is charged that these four knew that IL the
Forest City property sold to the Cleveland
Railway Company and the property OF the latter
leased to the Municipal Traction Company the
stock of Johnson, Lapp Zinner Hanratty ana
Henry would be made more valuable and they
would be financially benefited. IT Is declared
that these men had the financial interest IN sight
when three of them voted for the security grant.
and that Lam signed II as Vice-Mayor. Johnson
having purposely conspired to go outside the
CITY limits while Lapp signed the ordnance
thereby ii is alleged. endeavoring TO avert the
financial interest charge.