New Orleans Republican. [volume] (New Orleans, La) 1867-1878, 1871-05-14
THE STATE DEBT.


| in its various aspects, will be at least in
| teresting, if not satisfactory to the people
| who pay the taxes or hold the obligations.
The first and most natural inquiry is,
| what debts exist against the State which
draw INTEREST," All those debts are in the
shape of bonds issued by the State, drawing
interest at different rates.
The first class of these debts or bonds are
those issued in favor of the property banks,
the Consolidated Association and the Citi-
zens' Bank.
The Auditor reports there is $5il 500 of
the bonds issued by the State in favor of
the Consolidated Association yet out
standing These bonds were issued for
the following purpose: The bank under the
title of the CONSOLIDATED Association of
the Planters of Louisiana" was incorporated
in 1897, with capital stock of s., 600 900, to
be raised by means of a loan to be obtained
by the directors, to procure which they
were authorized to issue the bonds of the
company, bearing five per cent per annum
interest, payable half yearly
Subscriptions to the amount of So 500, 900
to the capital stock intended to secure the
loan of 81. .00o, 900 were authorized to be made
to give mortgage on immOvable property
for the amount of their subscriptions.
In 1923 an amendatory act to the charter
was passed, providing that IN order to faci-
| itate the consolidated association to nego-
tiate the loan provided by the charter, the
faith of the State was pledged for the reim-
bmsement of the capital and interest of the
loan, and bonds were authorized to be sub
scribed by the Governor and Treasurer un-
nf lao Gtatn IN, 20, ,f %I,n
president and directors OF the company. to
be used for that purpose, and the bonds,
| with privileged mortgage of the stock
holders, were required to be deposited as a
guarantee fer the reimbursement of the
principal and interest of the bonds given
by the State; the consolidated Association
being bound and obligated for the payment
of the bonds subscribed by the State at their
| respective maturities, and to pay the semi
| annual interest until the whole was paid.
The Auditor reports there is $4 ,297 1888 50
of the bonds issued by the State i'll favor of
the Citizens Bank yet outstanding. These
bonds were issued under the following cir
cumstances:
The Citizens Bank was incorporated in
1888, with a capital of Sl2000,000, to be
procured by loan TO he obtained by the
directors on bonds to be issued by them,
payable in equal portions in fourteen.
twenty three, thirty-two, forty-One and fifty
years.
The capital stock was only to b. sub
scribed for by owners of real property, and
to be secured by mortgage on real property
which mortgages were to form the basis of
and stand as a tull security for the loan and
the interest thereon to raise the capital
stock, and which mortgages were to IT main
a perpetual pledge to the holders OF the
above bonds.
In 1896 an amendatory act to the chart r
of the Citizens Bank WAS passed. prOvid-
ing that in order to facilitate the Citizens
Bank in negotiating the loan of Sl2 2C00,0J0
capital stock the faith OF the State g
pledged as security for the said $4,000, 600,
and bonds OF the State were authorized to
be issued to the president and directors Of
the bank, not to exceed $4,000, 900, IN
series of IA, %, 81, Al and 50 years from
February |, 1886. For the guarantee of the
principal and interest of those bonds ali
the securities granted by the original act
of incorporation to the holders Of the bonds
authorized to be issued by the directors,
were transferred to the State and the hold
ers of the said State bonds. If the ell
tire amount of Sl2 ,0000O0 were issued
only the two last series, each of s.. 400 600.
due in 1877 and 1886 remain unpaid, an
amount exceeding that reported as out
standing by the Auditor.
No appropriation to pay either the princi-
pal or interest ON any of the bonds of
either of these banks has ever been made
by the Legislature, nor have these bonds
ever been set down by the State officials
as debt proper of the State.
The State never having been called on to
pay any portion of the principal or interest
of these bonds, although having been issued
thirty-five years, and there being such am
pie security to retire those yel outstanding.
and never having been treated as debts
proper of the State, it could never have
been intended to include those bonds as a
part of the.debt of the State under tie in-
tendment of the amendment to the copsti-
tuition.
The next division of the interest bearing
or bonded debt of the State, and which is
classified as debt proper of the State, which
We will examine, is that which existed be-
fore the war.
From 1853 to 1861 there issued in favor
of the Opelousas railroad $50 bonds of
$1,000 each, bearing per cent interest $6500oo
From 1888 to 1858 there was issued 1884
bonds i'll favor of the Jack ckson railroad
OF 1000 each, bearing per cent inter
From 1854 to 1861 there was issued 298
bonds in favor ofthe Vicksburg Shreve-
port and Texas railroad of j 1900 each,
bearing per cent interest. ............ 298 600
In 1882 there were sued 80 bonds in favor
of the Charity Hospital of s 1000 each
bearing per cent interest. ...... $4,000
In 1857 there were issued 457 bonds in favor
of the Nashville railroad OF j 1000 EACH
hearing per cent interest. .....~.. $4,000
In 1889 and 1870 there were issued IS bonds
III favor of the Mexican Gulf railroad
of + 1000 each bearing per cent inter
From 1854 to 1866 there were issued l6o
bonds TO the Baton Rouge, Crosse Tete
and Opelousas railroad of $l 1000 each
bearing per cent interest -, l6O,o 900
IN 1883 there were issued 1900 bonds for
the relief of the State treasury of $500
each bearing per cent Interest,". 10000
III 1857 there were issued 1876 bonds i'll favor
OF the State Seminary of + 1000 each,
bearing per cent interest. ........... l36 900
Ia 1857 there were issued 529 bonds in favor
Of the free school fund OF 5 1000 each,
bearing per cent interest. ............ 529,000
474O bonds making total of .......s s ? ,99O, 900
Amount of annual interest on the above
bonds, $238, 800.
There are now in the hands OF the State
Treasurer of the above bonds held for the
following trusts, to wit: Redemption of
State debt, Seminary fund and free school
fund
125 of the Opelousss railroad bonds ... 3 Sl25 900
375 of the jackson railroad bonds ...... 357 900
18 of the Nashville railroad bonds. 49,. l8,0O0
13l of the relief of State Treasury bonds g., 500
10 OF the Mexican Cult abroad bonds l3 900
50 OF the Vicksburg, Shreveport aud
Texas railroad bonds. ................ $4,000
20 of the Baton Rouge Crosse Tete and
Opeousas railroad bonds ........... 29 900
500 of the free school fund bonds. $4,000
1856 Seminary bonds OBSERVATION-DISCLOSURES. 136 600
1888 Total ......... .............s s. ,322 500
Annual interest on these bonds, $7S, $50.
1t will be perceived from this statement
that of the 4740 bonds, amounting to $780,
600, issued before the war that 1888 of these
bonds, amounting to 81, ,322,500, are in the
State treasury and belong to the State, set
apart as representing funds designated trust
funds by the State; leaving outstanding Of
those bonds 3Sl2 Penresentinp S2.667 .1UU.