Papers Relating to the Foreign Relations of the United States, 1920, Volume II
The Minister in Cuba ( Morgan ) to the Secretary of State 88
Sir: I have the honor to enclose in duplicate, copy of the Provisional Governor’s decree No. 681, issued on the 22nd instant, by which it is resolved that the Government of Cuba shall enter into a contract with the McGivney and Rokeby Construction Company, organized under the laws of New Jersey, for the installation of a system of sewers and for certain work of street paving in the City of Havana, which contract is a continuation, with certain important modifications, of that which was signed on January 10, 1902, under the American Government of Intervention, between the Municipality of Havana and Messrs. McGivney and Rokeby.[Page 84]
This decree, which gives the text of correspondence between President Roosevelt, Secretary Taft and Secretary Root relating to the matter in hand, contains among other important provisions the following: Two-thirds of the cost of construction shall be assumed by the Cuban Government the expense to be met from a fund created from ten percent of the customs revenues of the port of Havana accruing during the next seven years and such additional time thereafter as may be necessary to complete the payments under such contract. This ten percent shall be a charge upon the Treasury next after the fifteen percent already reserved from the customs receipts of this port to meet the principal and interest on the Speyer loan of thirty-five million dollars.88 The Municipality of Havana shall bear the remaining one-third construction expense which it shall ultimately repay to the National Government for advances which the latter shall make. The supervision of the execution of the contract shall be under the direction of the Head of the Department of Public Works, under whom shall be a supervisor of construction, with an annual salary of $7,500, to be known as the “Chief Engineer of the Havana Sewer and Paving Contract” who, appointed by the Provisional Governor or Chief Executive of the Republic, shall be removable only “for cause duly established after due notice and public hearing.” This last provision is of moment since it tends to give continuity to the work of supervision and to free it as far as possible from political control.
I have [etc.]
Executive Decree No. 681, June 22, 1908, Granting a New Contract to the McGivney and Rokeby Construction Company 89
Whereas, by Article V of the Appendix to the Constitution of Cuba and by treaty stipulation with the United States there is imposed upon the Government of Cuba the duty of carrying out works for the sanitation of the Island, and the general government by Decree No. 894 of August 26, 1907, has assumed general control of matters pertaining to sanitation, and
Whereas, in order to provide in part for the sanitation of Havana, on January 10, 1902, the said municipality entered into a contract with Samuel P. McGivney and Ralph T. Rokeby for the installation of a system of sewers and for certain work of street paving in said [Page 85] city, which contract has, by consent of the City of Havana and the approval of the Chief Executive of the Republic been transferred to McGivney and Rokeby Construction Company, a corporation organized under the laws of the State of New Jersey; and
Whereas, since the date of said contract the city of Havana has failed to cause the same to be executed, and is not now in a position to carry the same into effect for lack of funds; and,
Whereas, in view of the foregoing conditions, the Secretary of War addressed to Governor Magoon a letter bearing date March 5, 1908, referring to and making a part thereof a letter from the President of the United States to the Secretary of War bearing date March 2, 1908, accompanied with a letter from the Secretary of State bearing date February 29, 1908; and a letter from the Secretary of War bearing date February 1908, all of which correspondence is referred to and made a part hereof, and is as follows:
March 5, 1908.
My dear Governor Magoon: I send you herewith copy of Secretary Root’s letter to the President in respect of the McGivney and Robeby contract for sewering and paving the City of Havana, and also copy of the correspondence which I sent him on the same subject, together with a copy of the President’s reply thereto. In accordance with the President’s expressed concurrence in the views and recommendations set forth in this correspondence, you are hereby directed to carry out the plan therein outlined.
Very sincerely yours,
(signed) Wm. H. Taft,
Secretary of War
Hon. Charles E. Magoon,
Provisional Governor of Cuba
The White House,
Washington, March 2, 1908.
My dear Secretary Taft, I have considered your letter of the 25th ultimo and also the letter of Secretary Root of the 29th ultimo, setting forth the history of the construction contract made in January, 1902, for sewering and paving the city of Havana, Cuba, and embodying your recommendations as to further steps to be taken to complete the work thereunder.
I concur in the views and recommendations set forth in these letters and am gratified that the way now appears to be open for the prosecution of this important work of sanitation to a speedy conclusion.
I return herewith correspondence in the case for the proper action.
Hon. Wm. H. Taft,
Secretary of War
Washington, February 29, 1908.
Dear Mr. President: Secretary Taft and Governor Magoon have talked freely with me regarding the present situation of the contracts for sanitary work in Havana and in Cienfuegos, and I have read the letters of Secretary Taft addressed to you upon these subjects.
While I am not in a position to speak regarding the details of those transactions, I think it highly important, from the point of view of the Department of State that something effective should be done in both cases. The provisions of the Cuban Constitution, following the legislation known as the Piatt amendment and of the treaty between the United States and Cuba following those provisions, especially impose upon the Government of Cuba the duty to execute, and, so far as necessary, extend the plans already devised, or to be mutually agreed upon for the sanitation of the cities of the Island; and among the plans specifically designated as already devised at the time the Island was turned over to the Cuban Government on the 20th May, 1902, was the plan for the sewering and paving the City of Havana. During all the time from May 20, 1902, until the recent intervention, the State Department has been urging the Government of Cuba to go on with these plans of sanitation. The execution of the plans is of the highest importance to the United States and especially to its seaboard commercial cities, whose trade was formerly seriously injured by the necessity of maintaining quarantines against the cities of Cuba. The provision which imposes on the Cuban Government the duty of sanitation works is a valuable treaty provision which the Government of the United States would not be justified in permitting to fall into desuetude. If, after our present intervention in Cuba has ended, it shall appear that we, ourselves, have taken such a course as to indicate that we do not think this work ought to proceed, it will be very difficult for us to maintain the proposition with the Cuban Government that it ought then to proceed.
In brief, the prosecution of sanitary work is a duty as to which we are bound to say that the Cuban Government ought to go on, and that duty rests upon the intervening Government, as well as it will rest upon the succeeding Government. If we do not recognize the duty now we cannot expect the succeeding Government of Cuba to recognize it when they come into power.
The performance of the duty of sanitation will have been greatly facilitated by the changes in the law that have been introduced under Governor Magoon and by which the work of sanitation has been nationalized, instead of being left to the separate municipalities as it formerly was. Now that the national Government of Cuba has assumed the responsibility for doing such work itself, there ought to be, and apparently there need be[,] no delay in the performance of the duty.
Washington, D.C., February [25,] 1908.
Dear Sir: The City of Havana is in need of an adequate sewer system, and additional street paving is also required by reason of the continued growth of the city.[Page 87]
On June 21, 1901, pursuant to the laws in force bids were advertised for, by the City of Havana, for the work of constructing a system of sewers and for doing certain street paving. The bids were opened October 23rd of the same year, and those of Ralph T. Rokeby and Samuel P. McGivney, bidding together, were accepted for both classes of the work.
On January 10, 1902, a contract was duly entered into between the successful bidders and the city, and the contractors deposited the amount of $500,000 with the city as security for the due performance of the contract by them, which amount still remains with the city. Under the terms of this agreement the contractors were obliged to commence work within thirty days after being notified by the Mayor of the City of Havana that funds were available in the City Treasury for the execution of the work, and to complete said work within four years from the date of such notification.
Work has never been commenced under said contract, the city never having given the notice that it had funds available for the purpose, and it is improbable that the revenues of the city will be found sufficient for the time to meet the requirements of said contract, in addition to the demands now being made upon them. The work of the sanitation of the Island is intimately connected with the sewering of the larger seaport towns, and the proper paving of their streets. The general work of sanitation has been taken over by the central government of the Island, and work of this character, particularly in Havana, becomes to a large degree national in character. Furthermore, Article V of the Appendix to the Constitution, being one of the so-called Piatt Amendments to said instrument, imposes upon the Government of Cuba the work of carrying out works for the sanitation of the Island, and this considered in connection with the liability of our southern ports to infection from yellow fever brought in from the ports of Cuba, renders this [a] question of international importance and one of special interest to the United States as well as to the Island of Cuba.
In view of the conditions, and in view of the further fact that Havana is the capital of the Republic, and that many of its public buildings and institutions are located there, it seems just and proper that the general government should take over this work, guaranteeing the performance of this contract and advancing the necessary funds. Since the work is of special benefit to the City of Havana, it should bear a part of the cost, and it is assumed that one-third of the cost would be a proper proportion to be borne by the city, the general government paying two-thirds. This division can appropriately be fixed by Decree, since under the proposed municipal law as approved by the Advisory Commission, it is provided that in works of this character where the expense is to be borne by the municipality and the general government, Congress may fix the proportions to be borne by each if the same is not satisfactorily settled by agreement.
It is therefore recommended that the Provisional Governor be authorized to issue his Decree sanctioning the execution of a supplemental contract between the State and the McGivney-Rokeby Construction Company, a New Jersey corporation, which has succeeded to the rights of said McGivney and Rokeby under their contract of January 10, 1902, whereby the State shall undertake the supervision [Page 88] of the execution of said contract and the obligations of the City of Havana thereunder, and the said Company shall agree to the performance of the obligations assumed therein by said McGivney and Rokeby subject to the modifications hereinafter stated, and also fixing the manner of securing payment and the proportion to be reimbursed to the State by the City of Havana.
The modifications of the original contract necessary to be made in view of the delay in the execution of the said contract and the resulting changed conditions and because of the assumption by the national Government of control of the execution of the contract, and, in greater part, of the obligations of the municipality thereunder, have been the subject of conference between representatives of the contractors and of the Government, who have agreed upon a project of supplemental contract which is hereto attached. The covenants of the supplemental contract seem equitable and fair to both parties, thereto, and should, I think, be approved without prejudice to the right to extend the stipulations to cover other matters in respect of which mutual agreement can be had.
In the project of the supplemental contract attached hereto, the contractors have insisted upon such provision being made as to the funds necessary to complete the work as shall absolutely secure them in the due payment of the sums to become due under the contract.
To meet this request, which I think should be acceded to, it is suggested that the Decree authorizing the supplemental contract should fix the proportions of the expense to be borne by the State and municipality respectively, and should contain a pledge for the payments arising under the contract, of ten per cent, of the customs receipts of the port of Havana, next after the fifteen per cent, now set aside for the payment of the principal and interest of what is known as the Speyer Loan of $35,000,000, the same to be set aside in the Treasury, and devoted solely to the disbursements arising under said contract, as assumed by the State. In accordance therewith, a suitable provision should be inserted in the contract.
The Decree should further contain a provision that the city shall reimburse the State to the extent of its due proportion of the expense from year to year, as the same is incurred, including the necessary amounts in its annual or extraordinary budgets for the purpose, reserving, however, the power which it may have under the proposed municipal law of reimbursing itself by charges or assessments against the property benefitted by the works.
It is respectfully recommended that the Provisional Governor be instructed to issue the necessary Decree for carrying the above modifications into effect.
Wm. H. Taft,
Secretary of War
Whereas, it is now a matter of public necessity, as a sanitary measure, to provide the city of Havana with a system of sewers and street pavement substantially as provided for in the above mentioned contract; and[Page 89]
Whereas, the change of conditions since the said contract was made renders it necessary that certain alterations should be made in the plans and methods for carrying out said work; and
Whereas, pursuant to the foregoing correspondence and the direction of the President of the United States, negotiations between the Government of Cuba and the said Construction Company have resulted in an agreement for a new contract to be entered into between the Republic of Cuba by the Acting Secretary of Public Works, thereunto duly authorized party of the first part, and the said McGivney and Rokeby Construction Company, party of the second part, to be celebrated before any Notary Public in Cuba pursuant to law;
Now, therefore, in compliance with the foregoing correspondence and directions, in the exercise of the powers conferred upon me as Provisional Governor, and upon the recommendation of the Acting Secretary of Public Works:
I Hereby Resolve:
Article 1. That the Government of Cuba will enter into a contract in due form with the said McGivney and Rokeby Construction Company containing the same provisions as those contained in said contract of January 10, 1902, the Government of Cuba assuming the same obligations as the City of Havana, and the said McGivney and Rokeby Construction Company assuming the same obligations as the said Samuel P. McGivney and Ralph T. Rokeby, in said contract, except as such provisions are modified by reason of the change in parties, but modified and amended, however, in the manner prescribed in said instructions above quoted, with such other modifications and stipulations as may be necessary and proper to carry out the purposes of said original contract, and as changed conditions may require.
Article 2. That the Acting Secretary of Public Works is hereby authorized on behalf of the Government of Cuba, to celebrate the contract herein provided for with the said McGivney and Rokeby Construction Company, in accordance with the terms and conditions of this Decree, before any Notary Public in Cuba pursuant to law.
Article 3. That the supervision of the execution of said contract shall be considered a part of the duties of the Department of Public Works, and it shall be the duty of the Secretary of that Department to make timely requisition upon the Treasury of the Republic for the necessary funds and to provide for the payments to be made under the said contract according to its terms.
Article 4. That there is hereby reserved and set apart ten per cent of the customs revenues of the port of Havana accruing for a [Page 90] period of seven years, and such additional time thereafter as shall be necessary to complete the payments under such contract, from the date of said contract to be entered into, next after the fifteen per cent thereof now set aside for the payment of the principal and interest of the loan of $35,000,000 known as the Speyer Loan, to meet the payments required by said contract, including the cost of superintendence and management, and also the portion of such payments chargeable to the municipality of Havana, as hereinafter provided, which amounts are to be advanced by the State and reimbursed to it by the municipality as provided in Article 5 of this Decree.
Article 5. That one-third of all payments to be made under the contract herein authorized, including expenses of superintendence and management and the cost of other works of sanitation specified in Article 6 of this Decree, rendered necessary by said work, and which may have to be done at the expense of the State, shall be chargeable to the municipality of Havana, which shall reimburse the same to the National Treasury in quarterly payments covering each quarter year, upon statements to be furnished by the Department of Public Works. The municipal council shall make provision for such reimbursement in its annual or extraordinary budgets, without prejudice to reimbursing the municipal treasury by assessments of the cost on the property benefitted according to the municipal law. The Department of Public Works shall opportunely furnish to the municipal council an estimate of the city’s portion of the expenses on account of such work for the fiscal year in time for incorporation into the said budgets.
Article 6. That the Secretary of Public Works shall, as soon as practicable, prepare and submit to the Chief Executive, plans and estimates for the construction and repair of sidewalks, the repair and betterment of the water supply and distribution system of Havana, and other works necessary to the sanitation of said city and depending on or incident to the execution of the above-named contract, and shall further state the probable amount of money to be required annually for such works until completed.
Article 7. That there is hereby appropriated the said ten (10) per cent of the customs receipts of the port of Havana for the payments required to be made under the contract herein provided for, including expenses of superintendence and management, and sanitary works referred to in the preceeding article, and there are also appropriated for said purposes the amounts reimbursed to the State by the municipality of Havana as provided in Article 5 of this Decree, the said sums to be available until used. And all expenditures hereby authorized under the said contract shall be made upon the approval of the Chief Engineer of the Havana Sewer and Paving [Page 91] Contract appointed as such pursuant to the provisions of the contract provided for herein.
Article 8. The supervision and control of the work done under said contract shall be and the same is hereby vested in an officer to be known as the “Chief Engineer of the Havana Sewer and Paving Contract,” and said office of Chief Engineer of the Havana Sewer and Paving Contract is hereby created, with the powers, privileges and emoluments stated in said contract. Said Chief Engineer shall be appointed in writing by the Provisional Governor of the Island of Cuba or by the Chief Executive of the Republic. The salary of said officer shall be seven thousand five hundred (7,500) dollars per year, payable monthly. Said Chief Engineer of the Havana Sewer and Paving Contract is empowered to appoint, control, and remove any and all personnel required to be employed by the State in the execution of said contract, and to fix the rate of pay of said employees. His tenure of office shall continue from appointment during the term of said contract, unless sooner removed by the Provisional Governor of Cuba or the Chief Executive of the Republic, for cause duly established after due notice and public hearing. In case of the death, resignation, or incapacity to act of said officer, a new Chief Engineer of said Havana Sewer and Paving Contract shall be appointed by the Chief Executive of the Republic, after first hearing the Contractors and the Secretary of Public Works as to the qualifications of their respective nominees for the position.
Article 9. As no new pavements can be laid in the streets of Havana for sometime, and as the problem of the best class of street pavements for cities has not yet been satisfactorily solved, and improvements in such pavements are being made continually the question of the readjustment of the classes of pavement, new or otherwise, to be placed in Havana, and of the prices to be paid for such work, is left to the future, to be determined as herein provided, and in that behalf the Secretary of Public Works is authorized and directed to insert in said new contract herein provided for, a clause to the effect that the stipulations of the same, as well as of the original contract, may be altered, amended or modified at any time hereafter in the prosecution of the work by the mutual consent in writing of the Contractors and the Government.
And full power and authority is hereby granted to the Secretary of Public Works, with the approval of said Chief Executive after first hearing said Chief Engineer, to agree in writing from time to time with said Contractors as to any such alterations, amendments or modifications, as occasion therefor may arise in the prosecution of the work.
Article 10. The consent of the Government is hereby granted to the transfer by Samuel P. McGivney and Ralph T. Rokeby, of [Page 92] all rights which inhere in them to occupy the maritime zone of Atarés Bay, Harbor of Havana, for an asphalt plant and for the purposes of wharfage and storage, under the permit granted them by Major General Leonard Wood, Military Governor, under date of April 22, 1902, to the Contractors, subject to the conditions named in said permit.
Article 11. A section of the Tallapiedra Wharf, sixty-six (66) meters long, next to and west of the west wall of the Arsenal prolonged, is hereby set aside for the exclusive use of the Contractors during the life of the contract.
Said space shall be used for wharfage and for loading and unloading vessels or lighters at said place with the proviso that the said wharf shall not be used as a place for permanent storage for materials, but only as a landing and temporary storage place, the Contractors agreeing to remove the material from said wharf in due course with due diligence.
This permit shall extend during the term of said contract, and shall be used by the Contractors only for the uses and purposes of carrying out this contract and not otherwise.
In addition to the above, and subject to the same conditions, the Contractors are granted, for storage purposes, the use of all the portion, not now occupied, of that parcel of land, the property of the State, lying between San Pedro Street, and a line running westerly parallel to the south front of the San Ambrosio Hospital building, from the northwest corner of the concrete wagonwashing platform of the Department of Public Works, situated on Factoria Street, and ending at the outer wall of the outbuilding of the San Ambrosio Hospital building.
Article 12. Free use of the city water is hereby granted to the Contractors, under reasonable restrictions to prevent waste as prescribed by the Chief Engineer.
Article 13. This Decree shall take effect on and after its date.
D. Lombillo Clark,
Acting Secretary of Public Works