The New York herald., 1921-12-07
Elon r. Brown Seeks to
Show Huge Loss to City
in Low Rentals.
DOWNING TWITS OTHERS
Election Result Was Rebuff to
Investigators, Says Tam
many Member.

The Meyer legislative committee. on
resuming yesterday it's investigation
into the system OF swindling the city
through pier leases, brought out that
the Kerr Steamship Company had paid
s34.50O. which went as bonus to H.
B. James, president of the Victory
Steamship Company. This was for
getting a lease on a pier at Thirty
third street, Brooklyn. James died last
spring.
The eXtortionate pier profits have
resulted in a loss of more than $15,-
100000 in blood money" which has
gone to some one in the form of graft,
it was charged by Elon r. Brown,
counsel for the committee. This repre-
sents an actual loss of that sum to the
city.
Robert c. Scholz, vice-president of the
Kerr Steamship Company. testified that
when his concern wished to get the
Brooklyn pier he consulted with his
friend, Edward A. Kelly. assistant gen.
eral manager OF the Clyde Steamship
Company. who agreed to do what he
could to help. After little negotiation
Kelly said the matter could be arranged
il the Kerr company would agree to pay
the difference between the city rental
and the market value based on the total
income.
Scholz said the payments to Kelly OF
s34,500 were in cash and handed over
usually in sealed envelopes. He supposed
the money was for Kelly as a commits
sion. The lease ran from May to Octo-
ber 1919. Kelly never explained what
he did with the money. the witness said,
and there was no intiInation that he
divided it with any one.
Kelly's version OF the story was:
"a day or two after l talked with
Scholz 1 saw II. B. James, who was
president OF the Interstate Lighterage
Company and the Victory Steamship
Company and some other companies. and
he said he would see what he could do.
He told me few days later it might be
arranged and that he should be paid the
market rates of wharfage, which were
from s125 to 5000 a day, the legal rate
of wharfage due the city to be deducted
from that rate and the balance paid to
him in cash in weekly payments
at was specified in cash?" Mr.. Brown
asked
1T was" the witness said.
And you handed the money every
time to James?"
Every time. didn't know what
sums were in the envelope. L met him
usually at lunch at the Railroad Club
or downtown restaurant. or sometimes
in the evening up town"
did he tell you what he wanted the
money for?"
no"
"Tou didn't keep dollar of what the
Kerr company paid over?'
mo. Mr.. Scholz is mistaken in saying
wanted It for my services"
And IL was specified by James that
his name should not be mentioned in the
%
"That his name should not be known
and that he should have weekly pay
ments in. cash.
"IIe is dead?"
He died either in May or June this
year"
Kelly said It did not occur to him to
go to the Dock Department. and he knew
nothing about how James obtained the
lease.
isn't it obvious that you or any
steamship company ought to be able to
go to the Dock Department and obtain
n lease without payment TO an outside
party?" Senator Meyer asked. Kelly
said he never had given that thought
Senator Bernard Downing. Tammany
member, kept twitting Senator Meyer
and Mr.. Brown about the committee
failure" as reflected I'm the last city
election. and there were several sharp
encounters. Brown asked Downing mot
to holler every time he said anything"
Downing accused Meyer of voting against
n bill in the Legislature which would
have given the DoaS Commissioners au-
thority TO remedy the condition being
investigated. Meyer said the charge
was untrue and demanded an apology
and got half-hearted retraction.