The Princeton union., 1877-12-05
A WONDERFUL SCHEME.
A Sew EEsAEn for Fnying Off Ronds Of
Minnesota and Other states

"A SeN.GFAHM. LOT THylnE OH Bonas OF
.4i4 Minnesota and Other States.
From the New York Times.
. 81. The syndicate before referred to in the
columns Of the q 9'iiass, to found d scheme to
fund defaulted state, county, and NUM-
cipal bonds, have organized under the
laws of this state, under the title of Il >
( Funding Association Of the United
States, and have elected Hugh McCulloct.
ex-Secretary of the treasury, president; !;
J. Pierpont Nogsgaa, of. Drexel,s Morgan &
Go, vice president; Francis Murdoch.
Of the First National Bank, secretary and
/ Charles Lanier, Of Winslow, Lanier &
60, treasurer, Starting out with the idea
that individual holders Of defaulted Sc.
enrities are naturally powerless, the SYM
dacate propose to collect those parties to-
gether for their joint interest, and, acting
on the power thus gained, compel debtor
states, counties, aud towns to offer favor
able terms. 1t is estimated that the. de-
faulted bonds on which the syndicate de-
sign to operate aggregate over $500 ,oo0. ],
600, principally Of western and SOUTH
sern states, counties, and municipalities.
OF this amorat about $300,O00,OO0 are
county, city, or town debts, and $780,
100000 slaie debts. On the. southern
bonds no in;erest has been paid since the
wsr, and on the western bonds none since
the panic. Most Of these bonds have
been purchased by the:r present owners
at not more than from 1 Il to 43 per cent.
Of their par value. The syndlc.ste claim
that the real value Of bond depel DIS
rather on the legislation which authorizes
ITS Issue than on the paying ability or in
ftegrity pf the community which issues ii
a law has been drafted. which is to Is
Submitted to the gover.lors and legisla-
lures OF the States where default exists,
compelling the states, counties, and mu.
|r'cipalities to comply rigidly NTH the
termsof the several compacts, and as an
sinducen, ent 1or Il IFS adoption fhe syndi
|scate are to ofersto fund all bonds bear
ing 8 or 10 per cent. interest at per cent.
for State and 6 for city. The proposed
law provides that the state auditor. with
whom the new bonds are to be registered,
shall l' annually levy a tax upon the as
sessed value Of the property Of the state,
county, or municipality, distinct .frrsodm
ether taxes, and sacredly appropriated for
the payment Of the interest on, and the
creating Of a sinking fund to extip guisn
the Indebtedness. Should the proper
collecting officers neglect or refuse to
comp with this prov ision, the bondhold-
5ers are tohave theright to apply to any
court q in the state, whose duty it shall be
to issue 9 Speremp ptory nnandamus to. The
Ederelict official. 8.
The law further provides that no in
Junction @ or stay of proceedings shall be
granted BY any court or Judge of the
state to prevent or delay the collection OF
the tax. The syndicate hopes that the
legislatures of Virginia, North Carolina
South Carolina, Florida, Alabama, Louis
iana, Mi Mississippi, Arkansas, tx KANSAS.
Texas, Nebraska, Minnesota and Iowa.
to whom this law is to be submitted, will
pass It vt once, It is believed that all
will eagerly avail themselves Of the op-
portunity Of getting rid Of their burdens
and re-establishing their credit, as thew
are nearly all well able to dc. The as.
sessed value, which is one d nartsr 81. the
aetnal value, of the state of Tennessee ,s
5000, ,0o0,O 900; Of Arkan sa's, $200, 600 900. !.
'of the defanlting countiesand munlcinal-
tiles OF Kansas, Ss5O,o o0O, 900. Of { Ne.
braska, $500. .000, ,Go0;;y Of the citv Of
New Orleans, $500, 100000, and 50 on.
The bonded debt Of Tennessee is $40
|a0o0, 900; of Arkansas, $4,000 900; Of
Kansas, $24,O09 900 ;saef sebraskat &1O,-
O00, 600, and OF New Orleans, S23 oOo.-
600. The firms composing the syndicate
arc the First National bank. Drexel.
Morgan d. Co, Hugh. McCullOch "a IN