The Indianapolis daily herald. [volume] (Indianapolis, Ind.) 1865-1868, 1865-11-15

We ~ Nl ANt tttaIe nave DflU tfNi mere 20
represent; They do rot want the subject 10 be
left sith the Legislature Thew are willing 70
carry cut IN good faith the arrangement made
with the boadhOlsers OF the State. and to pay
tscnty i've cents tax upon eve-v one hundred
dollars valuation. until the State debt il eItiu-
guished. and they desrie that a clause shall be
inserted IN tie Constitution which shall secure
The application Of this overpius q the extn-
guishment OF tbs principal Of tie State debt
Mr.. Stevenson then followed. opposing Mr..
HOseis amendment, on the ground that taxes
should not be levied 10 The Constitution. aud IN
confusion used these words:
"Sir, this attempt % levy an additional tar
upon the people by u Is al wrong believe
there Is virtue enough IN the people 70 settle
this matter through their representatives. ia the
Legislature, and much prefer u leave i, with
that BODY
Mr.. walpole follo~ed in a speech opposing tie
adoption OF the original section reported by the
Committee. for tie reason that be would do
nothing TO confirm the contract made BY the
State with the boadholders unless there was
also provision requiring the bondholders to
perform their part of the contract.
Nr Mcguire followed 10 support OF the Origi-
nal section a. reported by The Committee. and
referred with appreciation to the calculation,
showing that the then existing rate Of taxation
would pay the debt 10 fifteen or sixteen years. il
the surplus was properly applied from year TO
year in the purchase of our stocks at the market
value.
Mr.. Richie then moved to recommit the sec
ton. with instructions to strike out aud insert
that "the present rate Of taxation--twenty. We
cents on taxable property and seventy five cents
on each poll-shsl be continued until the in
debtedness Of the State is fully liquidated.
Dir, Richie then said.
81 would remark that this is transcript OF
the report Of the Committee on the subject, and
have no doubt il this course il adopted that in
some fifteen or eighteen years the public in
debtedness of the State will cease to exist. I'm
der the action OF the General Assembly We
made this agreement with bondholders in
reference TO the payment of the bonds they held
which constituted the public debt. The adop-
ton of proposition of this kind will not only
increase the credit OF the State, but do away
With any suspicion that We have any disposition
to repudiate the contracts We have made. We
owe il to constituents that should
endeayor to erase the unjust aspersions cast
upon them ia relation to this matter Aud il is
due also to our bondholders that we should re
peat here, in this Convention, the action OF the
Legislature in the arrangement made. by which
in some fifteen years. we will rid our State OF
iis public debt.
Here the debate ended and the original sec
ton adopted. both amendments being laid
upon the table.
/ have referred particularly TO this debate to
show the views entertained by the Committee
reporting the Constitutional provision, and the
understanding of the Convention at the time OF
its adoption. Ii seems clearly to have been
understood by the Convention that the Butler
Bill guaranteed the continuance OF the tax oil
seventy FIVE cents on each poll and twenty FIVE
cents on each one hundred dollars worth oil
property, until the debt was liquidstei, and the
main subject of discussion was whether thi,
guarantee should be specifically incorporated
into the Constitution.
II the levy aud continuance OF specified tar
for the payment OF the principal and interest Of
the debt was guaranteed in the original arrange
ment made by the Legislature with the cred
tors, IL would be conclusive evidence that thu
State and the creditors were looking to the pay
ment Of the principal sum as well as the interest
and that the State could not. in good faith. in
definitely postpone the payment OF the principa
sum.
! But it is equally clear from Mr.. Buffers cal
: culatons. that he did not expect that the take
which were guaranteed would be sufficient 4
> pay the debt by the 18th day of January, lS66
: for, in fact, by his tables, the principal OF ia
! debt could not be paid before 1872 or 1874, ant
when take his tables in correction with tn
: language of the certificate, - redeemable at an,
time after twenty years at the pleasure of tn
;, State" il is manifest that Mr.. Butler had NJ
assurance that the principal OF the debt wou
be paid promptly at the end OF the twenty years
(, 1t turned out however, that the basis Of taxa
ton was far more favorable TO the speedy pay
: ment Of the debt than was contemplated by Mr.
! Butler and the Legislature in 1916, for the aver
age increase OF taxable property, from tina
time until the present, has been, "a before stated
nearly twenty lone millions OF dollars per an
mum. instead of six millions. And calculation
! which have caused to be made, will show tina
il the guaranteed rates of taxation had beer
maintained there would be in the Treasury OIL
> the first day of January, 1866. surplus OF fou
0 millions eight hundred and ten thousand sevel
hundred and four dollars and thirty-onc cents
). (S4,sl0,70i 3D. after defraying the ordinar
expenses of the State Government, and the in
terest on the debt from year TO year and it i
easy to show that il this surplus had been ap
piled from time to time, as it accrued. to thu
purchase Of our stocks at their market value
the whole debt would have been paid by th
e 18th day of January, 1866.
d 1t was we'll understood by Mr.. Butler AID th
bondhoders in 1896 that these rates of taxatio
were all that the State was able to bear at .ha
time, or would be able to bear for many years
and the language of the certificates, making th
:, principal payable latter the end of twenty year
at the pleasure of the State" shows that th
J Legislature entertained doubts whether th
: State would be able to pay promptly at the en-
j of twenty years, and that they did not intend Il
place her in a situation where. if she failed L
: make such payments, she would violate her con
tract, and stand before the world as repudiatin
J. or bankrupt.
}, In 1852 the Legislature departed from thes
; rates of taxation, and reduced the levy t
twenty cents on each one hundred dollars wort
: OF property, and fifty cents on each poll. Thi
90, ~Nlla nnftt. I'D -.
the levy upon taxable property huctuated from
fifteen 10 twenty cents on the one hundred dol
lars from 1853 to 1861.
: In 1852 tie Legislature passed an &C
D creating the State Debt Sinking Fund, and levy
ing tax of two cents on the one hundred dol
lars "for the reduction and ultimate extinction
I of the public debt"
This fund was placed under the control O
three Commissioners, consisting of the Auditor
Treasurer, and Agent of State, who wer
: directed To invest the proceeds of the tax frou
4 time to time in the purchase of the two and a
half and five per cent. stocks. The interest oil
the stocks thus purchased was to bepad semi
annually TO the Commissioners, who were to in
e vest the same in similar stocks, and thus Great
3 a Sinking Fund for the ultimate redemption O
: the stocks created by the Butler Bill.
in 1857 the Legislature failed to levy any tar
for State purposes for the years 1851 and 1855
:. auu Tor those Two years no revenue was cOlleCt
ed. In 1859 an act was passed instructing tn
D Auditor of State to sell the stocks which Ia,
been purchased by the State Debt Sinking Fun,
to the Board OF Commissioners of the Sinking
Fund. in order to raise money to defray the or
binary expenses of the State Government, an,
to supply the Deficiencies in revenue CROWNS
5 out of the failure to levy aud collect taxes TO
e the preceding two years. This act being bel,
void for want of title, the Board of Comms
sioners Of the Sinking Fund refused to act upor
il. but the Auditor OF State treating il as an in
struciion sold the stocks in open market an,
put the money into the Treasury AT the reg.
ular session in le6 il was enacted. that for th,
year 1863, and every year thereafter. five cent
be levied on each one hundred dollars worth O
: property for the reduction and ultimate extinc
ton of the public debt, to be used by the Stat.
> Debt Sinking Fund Commissioners as befor,
described, but at the extra session in the sam,
year. an act was passed dver,ing this tax. anc
that for the years 1861 and 1862, from the Stat,
Debt Sinking Fund. to the pay ment of the Wa
: Loan. which bad just been authorized, with
provision, however, that if the holder OF III,
War Loan Bonds would not sell them 70 Ii,
Stair AT rates NOT voaedpO fhair n1r v.lns III.