The Bridgeport times and evening farmer., 1921-06-16

. The statement was offered during the investigation of the arbiters on the questioned legality of the s32.OoO account of the concern against the city that formed the basis for the first of the famous injunctions. It is a direct contradiction of the varied reports that have been current to the effect that DonnellyS company was simply shield for a group of city officials who were deriving considera- ble profit out of municipal contracts.
 Donnelly's statement was disclosed this morning when the official report of Francis J. Brennan. Richard l. Neithercut and John K Williamson, who composed the board of arbitra- Ion, was made public. The arbiters had previously returned finding in favor of DonnelIy and advised the payment of the bills by the city.
 In the report, which covered all angles of the affair. was incorporated the report of Arthur N. Wheeler and Charlea E. Weeks, who had been au- thoriZed by the arbiters to audit the books, accounts and office records of both city end the company.
 The audit, according to the re- port disclosed no unfairness in the vouchers or records bearing on the invoices in question, or the S32,022.63, nor did test checking on paid bills in other months of 1920, other than November and December when the bills were contracted, uncover any reason why the bills should not be paid.
 As another result of the investiga- ton of tho arbiters and the auditors, the following suggestions were con tained in the report:
 That it does not look well for a member of Ehe Board of Apportion- ment to endorse notes of a company which has business passed to it by the city without bidding and on a cost plus basis.''
 That all city business be conduct ed according to the Bridgeport ordi- nances or else have the proper waiver signed by the mayor.
 That contractors take warning that business accepted from the city in an irregular way is assumed at the contractors risk.
 That the proper way to investi- gate the city's financial operations is by means of a state commission with full powers, and the arbitrators recommend that this be done
 That the work represented by these bills was ordered and authortz- ed in full knowledge that funds were not available. The work on these bills, and ones of similar character, were in excess of appropriations. and it is obvious that business should not be placed thus loosely, regardless of any precedent that may have been established in that respect. If the law is not strong enough to protect the interest Of the taxpayers then ad- ulI1OnaI SaIeSuarQS should be pro- vided to stop the practise of expendi- lures above appropriations. Too strong emphasis cannot be put upon the point that spending of taxpay yers' money without proper authorization should cease.'
 An affidavit of President DonneIIy was attached to the report explain ing the basis on which his company has been doing business with the city.
 The company, the affidavit testi- fes, has been doing construction work for the city since 1918, and furnishes labor, machinery, teams and the perintendence for construction work. The company pays for all such items and charges them to the city at cost, plus a gross profit charge of IS per cent, ercept on the machinery. On the latter, there is no profit charge, the same being furnished at regular local charges. In addition, the city pays compensation insurance at cost.
 The only supplies or material fur nished by the company are cinders, where needed in road construction work, and the cost, plus 15 per cent. profit, is paid by the city.
 Tho company makes no charge, the affidavit claims, for the services of President Donnelly or for office rent, clerical help, personal automobile or for small tools required in the work.
 The affidavit is verified by Jacob A Courtade, director of public works.