Los Angeles herald. [microfilm reel] (Los Angeles [Calif.]) 1900-1911, 1908-11-18
SHAW SUGGESTS
ROAD BONDS BE
READVERTISED
SUPERVISORS C0UNSELED TO
BEGIN AGAIN
BIDS OF ALTERNATIVE PROPOSE
TIoNs DESIRABLE
Chief Deputy District Attorney Adj
vises County Board How Best to
Dispose of $3,5oo,ooo
Issue

lHe subject comes up IOE ulSCusSlOH.
Mr.. Shaw expresses the belief that
the board should make a new adver-
tisement for bids and on different
terms than those contained in that Of
September %, which, he says, con-
tains certain features Objectionable to
bond buyers. The best plan, he thinks,
is to call for bids on several alterna-
tive propositions, covering different
methods of bond selling, and when
these are received the board will be
in a position to determine exactly on
the best proposition and make the sale
accordingly.
While certain members of the board
testifying in the trial of the injunction
suits expressed unhesitatingly belief
in Shaw's sincerity and a willingness
to follow where he led there was never
theless a reluctance on the part of the
same members in expressing approval
of the plan submitted by hmi yester-
day.
Chairman Patterson believed the adj
vertisement of September % should
stand. and that bids should be re-
ceived covering the specifications con-
tanned in that advertisement.
Patterson Talks of Delay
"Bids in accordance with other plans
COulu De SuDIulll6ut even Tic
present advertisement" he saG. "If
we liked any one of them it could be
accepted, even If it did not fill the
specifications contained in the adver-
tisement l am afraid that readver-
Using would cause delay"
Here, however, the question arises
whether the acceptance of a bid not in
accordance with the specifications
might not lead to further legal COM
fa, &c hxye
favorable action on a bid outside the
requirements Of the advertisement
would likely be contested by bond
houses submitting propositions cover
ing the specifications.
T. S. Eldridge said there was no
doubt in his mind that bids would be
received containing other propositions
than the ADVERTISED specifications called
for at would be a good idea for pur-
chasers to do this" he said. cit would
prevent delay and we could consider
any bid received without withdrawing
the advertisement"
Supervisor Wilson refused to say
anything pending the discussion to-
morrow.
Supervisor George Alexander ex-
pressed himself in few words but these
were uttered frankly and with energy.
MIR. Shaw's letter is all right; l
think the board should do as he sug-
| gests," he said.
Supervisor Manning was absent when
the letter was received. 1t was owing
to this fact that consideration of the
matter was continued until today.
Shaw's Opinion
Mr.. Shaw's letter is as follows:
big to advise you that the superior court
has issued a temporary injunction In the
case of Germaln Board of Supervisors,
I ~ II Taf-
fries company from carrying out the contract
heretofore made by the county with that
company for the engraving and printing
of the county highway bonds, but has re-
fused to grant any injunction against the
sale of the bonds, except to enjoin taking as
security for bid the certified or cashier S
check OF any bank making or interested in
the bid Tibet condition in which this
leaves the matter renders 1t. in my judg-
ment, inadvisable to proceed with the sale
of the bonds at the time now fixed, which
is next Monday.
In order to make a sale of the bonds, it is
necessary that the county have the bonds
to deliver, but under the Injunction now
in force the blank bonds cannot be pro-
cured under the contract with the Jeffries
company Even If on the final trial of the
case a permanent injunction should be re-
fused and the contract held valid. that
| trial cannot, in the ordinary course OF
events in the crowded condition of the
superior court calendar, take place for somt
months; and It would therefore be impos-
sible In any event to obtain the blank bonds
under that contract soon enough to make
delivery to the purchaser in any reasonable
time after acceptance of his bid. Even II
| g. purchaser could be found who would be
willing to walt 80 long for delivery, there
is nothing to be gained by the county by
that course. for the road work cannot go on
until the proceeds of the bonds are III
the treasury, and in the meantime every
probability is that the bond market Will
improve, so that better price couid De Cd
tanned when the bonds are ready for deliV-
! cry than at the present time. II may De
that the county could now terminate the
Jeffries contract for non performance the
time for delivery of the blank bonds under
that contract having already passed. but
| that course would possibly result In con
troversy between the county and the JEFF
| fries company as to the legality OF such
| action AS to the right of the county to dc
| this I express opinion, not having in
yestigated the matter. But if a contract
| were madew it'll some other company &c
| print the bonds, 1t seems probable that they
| would not be ready in less than two months
! Furthermore it is my belief that the best
| interests OF the county would be served and
| a better price obtained for the bonds, If a
new advertisement for. bids We're made OF
| diffarent basis The latter part of the
Injunction above mentioned would seem In
| deed to necessitate a new advertisement II
| order to insert therein the requirement OF
the court regarding certified checks. Bul
| however this may be, / strongly recommend
TO YOU. in the interest of the county, that a
| new advertisement be made on different
| terms The present advertisement requires
| the bidder to obligate himself to buy and
| nav for the bonds during a period extend
| ing more than two and one-half years IN
the future This is something no bond
huver likes to do, for he cannot absolutely
| foretell the course of the bond market and
anv considerable depression, If he hgures
| closely In making his bid, would mean for
| him a loss of his profit, If not a positive
loss in money. 80.
FTherefore 1t is certain that if any hids
| are received under the present notice the
| bidders will, in figuring the premium. make
| liberal allowance for possible depression
| IN the market. In support of this position
| 7 call your attention to several facts; First
| that several bond buyers on September "a
| last made substantially these statements be-
| fore the board in connection with the mat
| ter: second, that your clerk has received a
! telegram from eastern financial mouse
| saving that they could not bid on long
| fine deliveries. and asking If the terms OF
| sale could not be modified to provide foi
| Immediate delivery; third, that since the
matter was pending. I have talked with a
! commemorative of eastern bond buying
| house who came out here expressly to looh
nm these bonds, and he stated that MS
/ house would not bid on the present arrange
ment. giving as reason the long time
deliveries; fourth, that no longer ago thau