Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-12-23
WHISKY COMPANY
PLANNED IN BILL
Green Prepares Measure to
Set Up Privately Owned
Manufacturing Corporation.

For economic and efficient han
ding of medicinal liquor, within the
prohibition law, with a saving to the
Government of more than a million
dollars a wear in the cost Of admin
istration and conserving another
S4.5OO.000 in a ffve-year period, the
administrations plan for setting UP
q corporation, financed at first by
The Government and later by private
capital. was made public late yes
terday.
Chairman Green of the House ways
and means committee introduced the
proposed bill by title, the provisions
of which, TO be made public during
the Christmas recess, are to be along
lines recommended by Lincoln G.
Andrews. in charge of prohibition
enforcement. who believes it is
necessary for the Government to re-
plenish the rapidly dwindling law
full supply of medicinal whisky.
This measure would authorize the
creation OF a purchasing and manu-
featuring corporation, with an output
of 100000 gallons, under the strict
est governmental supervision.
Will BE Privately Owned.
After the preliminary organization
and q repayment of its borrowed cap
ital, the corporation will be entirely
in private ownership. The Govern
lnent will not be in business.
Under the plan of the bill the cap
ital requirements of the company are
figure at between $110,000,000 and
$120,000,000. 1t is proposed to obtain
his capital by the sale to the public
of a maximum of 100000 of gold
notes of the corporation with author
ity on the part of the Treasury to in
vest in these notes should it become
necessary.
The balance of the capital require
ments will come from the marketing
of per cent cumulative preferred
stock of the corporation and common
stock of the corporation without par
value in units of one share of pre-
ferred and one share of common.
100000 Shares of Common.
Mr.. Green's bill will provide for is
suance of 100000 shares of preferred
stock at par value of 500 share
and of 100000 shares of common
stock without par value.
The proposed corporation would be
managed by a board of nine directors
to be appointed at the outset by the
Secretary OF the Treasury. In time
they would be elected by stockholders.
A limitation would be placed upon
the profits of the corporation.
While the Government would re-
tain authority to participate in the
financing of the corporation through
direct appropriation, the Treasury
view is that all of the funds necessary
for operating the system would be
provided by the investing public and
by the owners of the existing stocks
of medicinal liquors now in bonded
warehouses. The common and CAPT.
tai stock provided for would be ex-
changed for the liquors, at a. fair
market value.
The corporation would set up two
distilleries, one for Bourbon and one
for rye whisky, within some State
where local law permits, and would
sell its product only to persons legal
iy entitled to a supply. Until a con-
templated $35,000,000 issue of gold
notes is paid off the Secretary Of the
Treasury would name all or a ma
jority of the corporate board of di.
fectors, and the Government, even
after the stockholders had taken en-
tire control Of the business, would
have special rights to regulate and
supervise the corporations activities.
- Only 6 of the 81 bonded warehouses
now used for whisky storage would
be kept in service, the Treasury De-
partment said.
~ New stocks of whisky for medicinal
purpose must be manufactured short
ly, the statement added, since at least
Ave years aging Is required.