New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-05-10
Shonts Says J. P. Morgan & Co.
Will Probably Withdraw Un.
less the City Acts in a
Few Days.
SPECIAL MEETING is CALLED
Mayor Plans to Have Board OF
Estimate Pass Resolution to
Satisfy Interborough's Fl.
nanciers-Money Con-
ditions Blamed.

Another crisis has developed in the
subway situation, and special meeting
of the Board of Estimate has been called
for . o'clock this afternoon to consider
the situation. President Shonts OF the
Interborough Rapid Transit Company
informed the board that j. p. Morgan g
Co. the bankers, who had promised 10
finance their latest subway proposltlon'
were ready to cancel their agreement
unless the proposition was accepted by
the city authorities within "a few days
Presiden. Shonts practically stated IN
so many words in letters written 10 Bor-
ough President McAneny and Mayor
Gaynor that unless the board took az
firmative action at the meeting yester-
day their bankers would probably with
draw.
No action was taken yesterday, how
ever. The matter was not alluded 10 in
any way at the regular meeting, but IL
was known at the time that the specia!
meeting Of the board would be held to-
DAY This meeting is 10 be behind
closed doors, and there was a difference
Of opinion as TO just what action, II any.
might be taken. II is the idea Of the
| Mayor TO pass some sort Of resolution
which will satisfy the Interboroughs
bankers President McAneny declared
I last night that he did not see how any
action could be taken on the INTERIOR
ough proposition alone; that they were
/ sf
| be necessary to settle all the points in
dispute as to routings OF various lines
| before the board could he expected TO
take affirmative action.
Up 10 yesterday A majority OF the
members Of the Board Of Estimate were
inclined to the belief that the statement
Of the bankers that they would with
draw unless action were taken by the
city within a few days" was IN the
nature Of a gigantic bluff. They held
that II was done simply to force 'he
city TO commit itself at once. YESTERDAY
some OF the members began 10 think
there might be some basis for the state
ment that conditions were such N Wall
Street that the bankers would sincerely
| like 10 get out OF the agreement made
| by them on February 81.
Attitude Of J. p. Morgan e. Co.
II was denied in Wall Street yesterday
that J. p Morgan g. Co. had served
notice upon the Board of Estimate that
they would be unwilling TO underwrite
| the subway construction Of the Inter
| borough Rapid Transit Company upon
| the present terms unless the board
should at Yesterday afternoons meeting
pass upon the Interborough's proposi-
ton. The bankers have, however, let
President Shonts and the Interborough
board know that i'm their opinion the
settlement of the question is being un-
duly DELAYED and that no banking house
can be expected to remain. obligated for
an indefinite period for an amount ap-
proxmating S1O0,0OO0OO with condi-
tions showing material change since this
obligation was assumed
The Sosition of the Morgan firm is
understood TO be substantially this:
After long negotioation the Public Ser
|
mate came to an agreement upon sys-
| TEN OF new subways. President Shonts,
with a good deal OF difficulty, got the
Interborough's board of directors 10 agree
10 the city's proposition in its latest ana
present form, and had even more difti-
Guilty in getting ]. p Morgan Co. to
give their financial support To IT. FINAL
", more than two months ago. all seemed
arranged. but the Board of Estimats
withheld its final approval, and has not
yet given it.
Meanwhile there has been decided
change In general financial conditions.
important political developments OF an
unsettling sort have occurred, strikes on
great scale are threatening, and the
whole situation has altered. In view OF
all this. It is the disposition OF the bank
ers. il Is understood. to abandon their
arrangements for financing the INTERIOR
ough subway construction programme
unless the Board of Estimate shall make
I'D its mind within & comparatively short
time.
the Morgan firm shall withdraw its
financial backing the subway question
will have to be taken up all over again.
and another long period OF complicated
negotiation will have to come before the
city will be able to carry out its plans
for subway extension upon the vast scale
now proposed.
Many Details To Be Settled.
President McAneny, who is chairman
of the transit conference committee OF
the Board of Estimate. would not say
whether he thought there was any DAM
ger of the bankers backing out. but he
was positive that the proposition could
not he accepted until number Of de-
tails had been settled. He gave out a
list which might involve several weeks
of consideration.
President Shonts Of the lnterborough
would not talk about the situation, put
1t was said at his office that the offer of
the bankers had not been withdrawn yet.
II the bankers should withdraw their
present offer and demand better terms
from the city it would probably mean