New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-07-22
PROTESTS CONTRACT FOR
SUBWAY EXTENSIONS
Borough President McAnenv
Thinks Profits Allowed Is
DiSproportiOnate.
CITYS SHARE DELAYED
Will Not Get Income from Third
Tracking Until Interest on
Bonds Is Met-Should Keep
Cost Down, He Says.

Borough President McAneny wrote Las,
night to Chairman Mccall OF the PuhIlo
Service Commission, protesting agalns,
the form Of contract for constructing ana
equipping the third tracks and extensIon,
of the elevated railroads Of the Inter.
borough Rapid Transit Company which
has been presented by that company 70,
approval AS the city does not begin N
get any profits on the third tracks ana
the extensions until after the COMPANY
has paid the interest on the bonds issued
for the work, it Is vitality interested IN
the cost OF such work.
The contract, which the Interborougb
has planned to enter into with John F.
Stevens. former head OF the Panama
Canal Commission, provides that he shah
be paid. not definite sum, to be fixed by
the contract and entered at once in the
cost OF construction and equipment but
that the contractor shall do all the work
involved for the actual cost and eI.
pense incurred, plus - per cent"
II is estimated that the work will cost
$2j, 10000, and so Mr.. McAneny wrote:
Thinks Profit Too Big.
You are asked, in short to approve
contract in which there is no possibl.
doubt as TO the profit OF the contractor.
and under which. upon his own state.
ments OF cost and expense. he is 10 be
allowed a fat sum, even the percentage
Of which the contract fails to name.
II have understood that the allowance
actually I'm the minds Of the officers OF
the company is 10 per cent. Upon the
estimated amount Of the work this would
mean a direct payment to Mr.. stevens NJ
s., $4,000 with full relief from the usual
contractors risk: with a premium, on the
other hand placed upon excessive cost.
and with absolute denial TO the city
which has, in a sense. a partnership III
terest--of the advantages OF competitive
bidding for the lowest price obtainaOle.
IF either a lump price or the margin
of profit TO be paid Mr. Stevens is ex-
cessive. IL will mean, as | have pointed
out, that interest must be paid by the
company upon larger issue Of bonds be-
fore the city will receive its half share
OF profit, and that the price the city
would be called upon to pay IN case OF
the recapture of the lines, or OF any part
Of them, would also be increased"
Hopes Contract Will Be Turned Down.
Mr.. McAneny expressed the hope that
the commission would reject the contract
and would give notice to the lnteroorouyh
that no contract for the expenditure OF
any large part Of the money the CON.
pany Is 10 invest in the elevated lines
requiring the commissions approval
would be approved unless it was pre-
sented as a result Of open and properly
safeguarded competitive bidding.
IL was one OF the last concessions MADE
by the marlborough in the dual transit
system contracts that it would submit
TO the Public Service Commission for sp-
proval all forms Of contracts or other
agreements. II was also agreed that the
commission could require competitive DID
ding, il IL should see tit
This contract was presented to the COM
mission some time ago. and according 10
information received by Mr.. McAnenN
majority OF the members Of the commits
sion seemed ready 20 approve. Then MI
McAneny heard OF il and asked time 20
study the contract. the result Oh "heh
appears in his letter TO the commission