The sun., 1910-07-16
'BACKDOWN BY SHONTS NOW
HE'LL TAkE MADISON AvENUE
route FOR EXTENSION.
And Furthermore He Doesn't Ash That
the CITY should Make Up Dencn'
From the start HIS New Proposal
Postpones Time for CIty To Give Up.

the city should Wake - Denct,
From the start-HIs New Proposal
Postpones Time for Cty To Give Up.
President Shonts Of the lnterboroush
company sent yesterday to Mayor GaynoT
a communication IN which the company
ahandons its proposals embodied IN the
application made a couple OF weeks ago
for permission to extend lts present
lines. One OF these proposals was that
II the earnings Of the company should
not at any time suffice 10 paw the interest
on the city's corporate stock issued for
the construction OF the extensions the
city should make up such deficiency and
not be reimbursed for such outlay when
the new lines become profitable. This
stipulation has been modified
II also Was indicated IN Mr. Shontss
letter that the Interborough company il
willing TO build Its northern extension on
the East Side under Madison avenue IN
stead Of Lexington
In the earlier proposition made nv the
company it was insisted upon that the
city should paw anv deficits on fixed
charges without hav ing those payments
made a contingent charge on future
profits and that the subway extension
should he carried under Lexington avenue
The adoption OF this plan would have
meant the dropping OF the Broadway
Lexington avenue line laid ont hv the
Public Service Commission according to
the latter
The Mayor made IL clear after he had
studied these two proposals that he
would not agree to either OF them The
one which would have held the CITY TO
make good any deficit bet~ cen the gross
receipts and Rross expenditures Of the
new roads. the Mayor said. would not be
tolerated by the administra ton Com
mentiug on this attitude Of the Mayor
The letter written Yesterday bS Mr Shonts
said
To meet your objections We are pre-
pared to modify this. IN submitting our
final proposal To the Public Service Com
mission. 80 that the max ing good Of any
temporary deficit by the city would be
limited to the payment of any interest
on its own bonds not met bv 'he ne,
earnings of the road and all interest 20
paid. together with a mixing fund OF
I per cent per annum, from the com
menCement OF operation Of the extensions.
TO be a preferred and cumulative charge
against the net earnings OF the road. to be
profits u made
The opinion was expressed however,
yesterday at the Offices Of the Public
Service Commission that this plan merely
meant that the lnterbOVouRh company
would nav Rny deficits which might occur
in the early operation Of the rOad but that
before the city was allowed To participate
ia the profits which would accrue when
the extensions became a paving pToposl-
JIon the deficits paid by the lnterborough
Company during the construction Of the
lines and the los- which was bound 90
occur on operation until the roads we're
finished would be deducted by the com
pany from the net earnings Of the exten-
sions " hen those earnings showed proht
earnings which o-tenslby are Ia he di-
vided betw cen the city and the company
On the question Of g1ylag up all claim
to Lexington avenue Air. Shonts IN HE
letter as-ui ed the city authorities OF his
willingness TO give careful consideration
NAV after due deliberation see III 10 pro-
pose either a. to the substitution Of
Madison avenue or any other matter IN
volved which may be- along the general
lines OF our -'IgRestlons
Mayor Gaynor. commenting yesterday
on the two principal matters di.rus sed
in Mr.. Shonts's letter. said oh. yes:
these two things are abandoned. and !
dare say when We come Ia a discussion
Of the matter there are other things that
hope for ~ a calm and even minded con-
sideraiion and discuSSiOn by the intelli-
gent public and 10y the intelligent and
decent press. - that correct CON
clusion NAV 10 arrived at The QUESTION
really IL should the city now start
in To huild an independent and rival
line. or should u ., tend and add branch".
from time To time e. the subway system
which " already owns and into which
u has put soo.OO.0n
i hope the matter will bs most care
fully considered. and I arm certain the
oN'ciRls of the CITY will he ready 20 follow
whatever intelligent public opinion NAV
decide upon have come 20 no decision
about Il az course We city officials
would greatly prefer 10 have the-e eN
tensions and branches built on the credit
~ the In'erhorough company n that
can he brought about or forced. and n
may he that u can. Df all things before
any of uE commit ourselves let the whole
subject bs considered fairly and care
fully