Bristol news. [volume] (Bristol, Va. & Tenn.) 1867-189?, 1874-11-24
TIE DEBT OF VIRGINIA.
Proposition from
British BomdhOlders.
Scheme for Retiring the Pres
ent Debt.

Mr.. John J. Mackinnon, represent
ing the American Bond-Funding and
banking Association (limited) of
London, was in Richmond during the
past week or ten days. He came TO
consult with Governor Kemper,
Treasurer Hunter, and some of the
leading, financiers of the city, in re-
gard to the debt of Virginia. His as
soclatien is accredited for fair dealing
and capacity TO execute whatever they
undertake by Duncan, Sherman & Co.,
of New York. Among its members
and stockholders are many of the lar
gest capitalists of Great Britain-such
men as the Rothschilds, Earrings, and
Gilliotts.
They propose to fund the entire
dept of the southern States; and have
already opened negotiations with sew
eral Governors. The matter will be
brought before the Legislatures Of
those States at the sessions to be held
this winter. In reference to the debt
of Virginia, which amounts to about
$50, 900, 900, exclusive of past-due and
unpaid interest and the one-third al
lOtted to West Virginia as her fair
share of the ante 6edltn1 Indebtedness,
Mr.. Mackinnon offered to fund it in
bonds running ten years and bearing
four per cent. interest in gold, or in
bonds running twenty years bearing
five per cent. interest in gold-the
principal and interest to be paid only
in London. The Association pre-
scribes as one of the conditions of the
contract it proposes to make with the
State that the money to pay the prin-
cipal and interest of the funded debt
shall be derived from fixed portion
of the revenue to be inviolably set
apart for that purpose. To accomplish
that end, they furnish copies of such
acts as it will be necessary for the
General Assembly to pass to insure
the desired success.
The scheme, it is said, was drawn
up by eminent counsel in England and
America. It's authors believe it is
amply sufficient to secure payment of
interest and principal as they fall due.
1t provides that the Auditor shall
every year levy such direct tax on the
property of the State as will be suffi-
cient to pay the interest and raise
sinking fund. The money raised by
this taxation is to be kept separate
from all other funds Of the State, and
is to be sacredly appropriated to the
designated object. In case the AuCi-
tor refuses or neglects to raise this tax,
according 10 the plan, any bendhOlder
is to have the right to apply to the
courts for a dnldn0dnlS 10 compel
him to do so ana the courts are to
be armed with the power to make the
Auditor execute his duties under the
contract.
Tie bonds are to be delivered by the
Treasurer to the Association as fast as
the Association or their agents are
ready TO exchange therefor the out
standing bonds in sums not less than
500, 900. The Association is represent
ted to own or control at least 1900
900 of the present bonds Of the State
believe they will have no difficulty in
selling the new bends at q higher
price than "cOnsOlsn now command in
the markets of the country, and thus
will be able to retire the present six
per cent debt Of Virginia and replace
it with the proposed debt bearing four
per cent. interest for ten years, or five
per cent. interest for twenty years.
The whole funding process is practi-
cally to be carried on through this Brit
ish association. The Association, it
is expected, will be reimbursed for its
risk, trouble, and expense, by the en-
HANGED value of the new bonds over
and above the present outstanding
bonds. The new bonds. they calculate
will have such value as will justify
those who own "consOlsn in eXchang-
ing them therefor. In that way the
taX-rr ceivable coupons, now con-
slant source of irritation and trouble
to the state, would nearly all be with
drawn from circulation.
Mr.. Mackinnon left Richmond for
the South yesterterday. 1t was gener-
ally thought in financial circles, where
the matter has been discussed for a
week, that some understanding had
been arrived at between the Governor
and him. 1t was, however believed
that the Governor would not consent to
recommend to the General Assembly
to embark in the scheme unless it
could arrange to have the bonds run for
thirty years and yet bear no greater
interest than four per cent.
Within the past week or two the
bonds of Virginia and of North Caro-
lima have made a decided advance in
the markets of the Union. This, men OF
| information say, is owing to the pros
pect of satisfactory adjustment of the
| debts of the two States as suggested by
this American Funding and Banking
Association of London.