The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1929-02-08
BOARD MEMBER
DEFENDS STATE
ARMORY PLAN
Monopoly Benefits Pointed
Out to Senate Probers by
General KerShner.

Adjutant General William H.
Keshner is the latest arn16ry board
member to come to the defense of
the CLOSED corporation" armory
building plan now under investiga-
ton by a special senate committee.
Tie first board member to defend
the program publicly was Senator
Robert L. Moorhead, who took the
floor in the senate Wednesday and
retired without victory under a
Cross-fire of Democratic questioning
Kershnef took the matter to the
committee, rather than the senate
as a whole, by handing Senator
AIonzo H. Lindley, Kingman, chair
man, an eighteen-page statement
regarding the armory building pro-
gram Thursday night.
System Defended
The entire matter is painted in
glowing phrases pointing out that
the business, which is to cost the
state about $35O,000 annually for
rentals, according to Senator Thur
man A. Gottschalk, Berne, minority
member of the budget committee,
is one of sweetness and light.
Gottschalk launched the investi-
cation by a senate resolution, Sec
onded by Senator Luther o. Draper,
Spiceland, Republican budget COM
mittee member of the senate.
Kershner attributes the entire
move to "pacifists, disgruntled con-
tractors and disciplined national
guard officers"
He admits that the entire build
ing program is carried on by
trustees" (holding companies) I'M
der the armory board direction with
financing by the Peoples State bank
and building by the Ostrom Realty
and Construction Company, a bank
Subsidiary.
Monopoly Held Beneficial
President Felix McWhirter of the
bank worked out the idea with him,
Kershner'S statement says and it
was given legal approval by Clar-
ence G. Wysong, state insurance
commissioner and attorney on the
armory board, the state board of
accounts. encouragement and the
state tax board.
Lawrence Orr. chief examiner of
the board of accounts, said that the
only objection he found to it was
that it was a monopoly.
Kershner contends that this mo-
nopoly has been beneficial to the
state and that it will mean state
ownership of the armories in about
fifteen years with the costs being
paid entirely by the rental leases for
which tn biennial appropriations
are asked.
How the plan works is described
in the report by citing the example
OF the armory at Lafayette, where
a S10,500 site was donated by Henry
Marshal and a 100000 building
erected, by the Ostrom company
with Peoples State bank financing.
1.-The bonds we're sold by the
OStrom Realty and Construction
Company at a 5-poipt underwriters
commission, to the Peoples State
bank" the Kershner statement con-
tinues, land the proceeds deposited
in trust in the Peoples State bank
and drawn out only on approval of
trustees, on architects estimates.
Costs Are Cut
The Peoples State bank paid
per cent on the deposit and made
no charge for trust services in con-
nection with the mortgage given by
the trustees to secure their bonds.
Contracts for materials and sub
contracts were given to the lowest
bidders and most of the material
sub-contractS and labor and me-
chanics were obtained from Lafay-
cite. Because of the nature of the
work splendid prices we're obtained,
and this and other armories con-
structed under this program have
been constructed at about two-thirds
of the usual estimated cube cost of
kindred public buildings"