The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1875-11-13
DISTRICT OF COLUMBIA BONDS.

TRUSTEES OF SAVINGS BANKS AUTHORIZED TO
INVEST THEIR FUNDS IN THE 1856 BONDS
OPINION OF THE ATTORNEY GENERAL OF THE
STATE OF NEW YORK.
ALBANY, N. ", Nov. IL, 1875.
The following is Attorney General Pratt's opinion
to investments in District of Columbia bends
STATE or New YORK !
OFFICE or THE ATTORNEY GENERAL,
ALBANY Nov. g. 1875. J
Hon. D. G. ELLIS, Superintendent of Bank Depart
DEAR SIR-Yours OF October 90 1875 with en-
closures, was duly received The Attorney General has
examined with considerable care the questions pro-
pounded to the Superintendent OF the Bank Depart
ment on behalf of several savings banks
IN the city OF New York, and has come
to the conclusion that trustees of savings
banks may, under the statute Of this State lawfully in
vest the moneys deposited in said banks in the 800
bonds of the District of Columbia issued under the act
OF Congress of June 20, 1874 and February 20 1875
BY chapter 81 OF the Session Laws of 1875 section 20
trustees OF savings banks are authorized ITO invest
moneys deposited in those banks in stocks or bonds OF
the United States those for which the faith OF the
United States is pledged TO provide for the payment OF
the interest and principal" BY section of the act OF
Congress of June 20 1874, amended by the act of
February 20 1875 after providing for the issue OF the
bonds in question the form thereof it is further
provided as tollows-
That the faith Of the United States hereby pledged that
the United States will by proportional appropriations
upon properly within District such taxes win do to
provide the 70 pay the on said
sinking fund pay the principal thereof maturity.
The terms of this provision are so similar to those
used in State statute in regard to investments by
trustees OF savings banks TO strong inference
that the trainers OF the latter act must have had the
acts of Congress in relation to the issue
OF these bonds before them, and framed
the act with special reference to these
bonds. That these bonds answered all the require
ments of our statute will not be questioned, unless the
clause prescribing the method of raising the
necessary to redeem the pledges in some i'm
pairs neutralizes the pledge ITSELF | am unable to
consrue that clause SO as TO give II any such effect As
TO that proportion of the obligations which Congress
may decide that the United States ought pay, the
pledge is absolute and unqualified that Congress will
make the necessary appropriation to provide
may be imposed upon the District of Columbia,
the pledge is substantially direct. Congress has
preme legislative power the District of Columbia
and may impose upon the property or inhabitants
rate OF taxation for the payment OF its debts
1t is only by Of taxation Of some kind that The
United States enabled TO discharge its pecunary OBJ
legations and the revenues necessary TO discharge these
obligations OF the District of Columbia may be raised
by taxation upon the property of The District well
by any other method OF taxation There can he
no presumption OF any failure in the amount Of
property subject TO taxation necessary TO- raise
the requisite amount OF revenue; and il there
could be such failure the Attorney General
does not see now the United States could be
relieved from its pledge 1.-The faith Of the United
States is pledged that the United States will by causing
to be levied upon property within said Dstrct such
taxes will do sol provide the revenue necessary 7,
&c The pledge is absolute that the United States
must be deemed TO take the risk Of any failure it's
objects of taxation. The Attorney General therefore
feels constrained upon a deliberate examination
of the question TO modify the opinion heretofore
rendered from this Department to the superintendent
OF the Bank Department and advise that his
opinion, trustees Of savings banks this state
legally authorized invest the funds of said banks IN
the 65 bonds of the District Of Columbia issued under
the acts OF Congress Of June 20, 1874 and February
20, 1875.
All OF which is respectfully submitted,
DANIEL PRATT, Attorney General.