The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1923-06-12
BIDS REJECTED
ION CITY BONDS
| ANDWARRANTS
City Commission to Readver-
tise the Water Works
Financing Issue
RATE NOT SATISFACTORY
Two Contracts for Additional
Mains Let Decline to
Change Plant Plans
RATE NOT SATISFACTORY

lhe CITY commission, meeting last
! night, received and rejected the only
bid presented for the purchase of
city bonds and warrants, to be used
! in financing the water work pur-
chase and improvements. The com
mission decided Immediately to re-
advertise the sale. bids to be rccciv-
Cd June 20.
The one bid presented was for
$225,000 bonds bearing percent in
tcrest and $476,0O0 warrants on
percent basis, although advertised
at percent. at premium Of ST.
500. The bid was from Ballard &
CO., Stacy, Braun & Co., and Drake
Jones Co., Twin City firms who COM
NGined in the offer. Representatives
u some other bond houses were
present but did not bid.
Opinion was expressed by men,
bcrs Of the citizens committee pres
cnt and commissioners that the
threat of impending litigation when
the city was proceeding to contrAct
for building an entire new plant had
discouraged other bidders, and that
better bids would be received on
the next offer.
The net rate of interest on the
offer, made was said to be about Ga
percent.
Lower Rate Broached
Later in informal talks with bond
men before the city commi ssi on
formally decided to readvcrtise
there was another offer informally
made to take warrants on 63-4
percent interest basis, bonds at par
and a premium on all of $1,000.
This it was said would make a
net interest rate Of about 6.l per-
cent.
Bond men said the bond market
has not been good recently. Some
time ago the state received one bid
on part of the bonds it offered for
sale only, the net bid being a rate
of interest of 4.9l but did not in
clude any bids for mill and elevator
bonds of about the same maturity as
the city bonds. The county recently
agreed to sell bonds at rate of in
terest of 51-4 percent.
A repre- sentative of the bidding
syndicate argued for acceptance of
his bid saying that the percent
bonds really were not worth par on
the market at present, but the syn
djcatc bid on them in connection
\ with the percent warrants. The
average maturity Of the bonds is
ABOUT ten years and the warrants
about II years.
A wire was received by the COM
mission from Kalman. Wood L. Co.
stating that since litigation had been
avoided, the present plant purchase
avoiding duplication, the company
, suggested the commission reject bids
'sqd readvertise.
The representative. of the bidding
syndicate said that it would take
some time after purchase of bonds
before they could be actually paid
for. The issue would have to be
passed on by Chicago bond house,
which would demand full informa-
tion on all steps leading up to the
purchase of the water plant, and it
would take some time to have the
bonds printed.
Proposed Change
The bids were not opened until
late as it was necessary to award all
contracts on which warrants were
based before the warrants were sold
E. A. Hughes presented a plan to
the commission and citizens commit
tee, changing the plans of Mr.. At
kinson and Mr.. Wolf of St. Paul,
engineers, to provide an equalizer
reservoir on the hill east and north
of the capitol, and to not put in the
proposed big 16-inch main from the
water plant west of the city down
Broadway to the business district
After some discussion the plan
was not adopted and the commits
sion decided to proceed according to
the engineers plans. One objection
raised was that the big 16-inch main
: was needed to deliver high pressure
to the business district in case of
fire.
The commission let contract for
furnishing cast iron pipe for mains
to the American Cast Iron Pipe Co.,
and the contract for laying the
main to DeGraff & Wolff Co., con-
ditioning both bids on the exclusion
of all work not now needed because
the city had purchased the old water
plant.
Bids on contract No. z. providing
for reservoirs, were rejected alto
(gether, because of the purchase of
4 the old plant.