The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1915-02-12


Hawaii bonds will be taken by Otis &
Company, well-known brokers of Cleve,
land, Ohio, according TO statement
made by Col. Charles J. Mccarthy, |
territorial treasurer. yesterday. The !
firm wanted to take $4,000 worth |
of territorial bonds, said the treas !
urer yesterday, but, for some
unexplained reason, the Governor yes
terday instructed the treasurer to cable
would be 100000. 'H .5.
Otis & Company have agreed to pay
10 cents above par, that is, $l00O.l0 on
each $1,000 bond. In this manner tho
sale will bring 100000. Offers have
been on the basis Of sos on the hundred.
The legislature of 1911 authorized
the floating Of an additional bond issue
in the sum of $l,430000. The bonds
were prepared in New York by former
Territorial Treasurer d. Lloyd Conking,
now city treasurer of Honolulu, it be-
ing decided that Of this issue $160,000
should be placed on the market for i'm
mediate sale, there being held in re-
serve bond in the sum of $6s0,000.. ~.
Former Bids Rejected 7.'
The public bidding for the purchase
of these bonds made but poor show
ing, the New York bids amounting TO
something like $4,000 worth, at 90,
these bids being all rejected, while the
Honolulu bids amounted to $50,50O at
par, all of which were accepted and
eventually taken up. "There is now in
escrow in the treasurer "a nffice a check
for $500, for Ave baby bonds, that
is, bonds of the 800 denomination,
said the treasurer yesterday, and the
check is awaiting the passage of fur
ther bond legislation. ...
Under the law, sales made subsequent
to the public advertisement sales re-
suits cannot be made under a lower
figure, and, since the last sales were
made at par, an arbitrary price had to
be fixed by the territory for the sale
now under consideration, otherwise new
bids would have to be called for.
A legal technicality has been hanging
fire on the question of the sale of these
bonds, on the ground that the sale must
be consummated by the treasurer who
prepared the bonds and called for bids
on them. D. Lloyd Conkling was
treasurer of the territory when the
bonds were prepared and his signature,
together with that of Henry G. Hapai,
registrar of public accounts, appears on
each of the bonds. Dillon, Thomson &
Clay of New York, foremost among
bond authorities in the United States,
raised this question and, in the CORE
spondence that followed, suggested that
a measure be passed in the coming leg
islature which would in effect remove
the purported cloud, This measure
was drawn up by the firm, itself, and
will be introduced in both the house
and senate when the eighth legislature
convenes here next Wednesday morning
at 10 o'clock. 1t is expected that the
measure will beat out even the session
appropriation bills of the two houses
for first place in the line of acts paS'a.
May Await Legislative Action
While the statement has not been
made with any lucidity, it is believed
that Otis & Company's offer to take the
amount Of Hawaiian bonds mentioned
is subject to the passage Of this legis
lation. The firm is aware of the opinion
of the New York bond firm on this point
and 1t is not likely that the sale, if it il
effected at all, will be closed until the
legislature has remedied the apparent
defect in the law.
OF the $75O,O00 worth of bonds, OF
the present and newest issue, for imme
date sale, there remain unsOld $699,5OO
With the disposition of the $40O, 900
now under negotiations, there will bC
Immediately available $299, 300 for dis
position. Kauai capitalists have agree
to take about $3l, 900 worth, to insure
the construction of the new territorial
wharf at Waimea, for which work there
exists an appropria ton of $4,000 from
the loan fond, the balance probably re
verting to the general loan fund fol
other purposes.
Why Governor Pinkham refuses to al
low the enter 100000 worth of bonds
now available for disposition to be sole
to Otis & Co., since this firm has otfereC
to take up to $750,000 worth, is no
explained The Governor refused to b.
interviewed on anything yesterday, anC
his reasons, if any he has, could no
be ascertained. Wharf and landing
improvements on all of the four bill
Islands of the group, including Homo
lulu harbor, remain at standstil
awaiting the sale of these bonds, al
though the urgency for immediate worl
in this line is SO apparently now that tn
actual opening of the Panama Cana
has shown the absolute inability of Ha
wall ports to afford the necessary ship
ping facilities already demanded.
Confirmation Expected
Final word was expected from Oti
4 Co. yesterday, but up to late hou
last night Treasurer Mccarthy had re
ceived no reply. This, however, is eN
pected today. The treasurer has beel
negotiating with Otis { Co., both b,
mail and cable, since January p
Should the proposition be finally &C
cented, it is believed that the bond
will not be delivered before March
before which time the territorial legis
lature will likely have passed the ac
Iegularizing the sale Of bonds by
treasurer other than the one who pre-
pared and signed any particular issn
of bonds.
The existence of this defect in tn
present bonding statutes of the Tel
rtory was first made public III The Az
Nertiser, and notwithstanding rePeate
attempts to refute the existence of th
Ia,oI 1acbninalitV The A6yaFtisPr - enl