The sun. [volume] (New York [N.Y.]) 1833-1916, 1879-02-08
Municipal bankruptcy in New Jersey.


tionaly fortunate. This is far from being
the case however. with the taxpayers dwell
ing in certain cities of that state, and cs-
pecially in Railway and Elizabeth. Both Of
those once thriving towns have followed the
same gddy and hoadong course untila last
their reckless. If not dishonest, cXtrava-
gance has plunged them in the evil plight
Of bankruptcy. Under analogous circum-
stances southern city has lately had re-
course to population; but We were not pre-
pared to hear that method OF liquidating
debts mootcd in an Eastern community We
think our New Jersey friends, upon calm
review Of the situation, will find it not only
to their credit but also TO their interest, to
maintain their reputation for probty and
good faith.
We drew attention to the lavish and I'M
scrupulous management of municipal affairs
which promptly led to the bankruptcy OF
Railway at the time when that city refused
to pay the interest on its bonds Tho story
Of Elizabeth's collapse, whose details have
lately been made familiar to our readers, Is
identical in its main features. With pop
ulatiun Of twenty-eight thousand and an
amount Of capital which IT is believed. upon
an impartial and rigorous assessment. would
exceed thirty million dollars, it has hcapcd
up an Indebtedness yariously stated at from
four to about five and half millions. The
amount Of interest accruing a few days ago
was thirty-sX thousand dollars, hut to meet
this demand the city treasury had only three
thousand. II will naturally be asked what
has been done with the money collected
during the past three months. Probably IL
was used TO take up floating loans. for It was
certainly not applied for regular municipal
disbursements. The police force have not
been paid during that period, and II theyarc
not disbandcd will presently disband them
selves. The public school teachers also have
failed 60 receive their stipcnds, and unless
funds are soon forthcoming they will doubt
less solve the school question 10y seeking
employment elsewhere. With her schools
closed, her watchmen and other civil en-
ployecs discharged, and with even the gas
lamps extinguishcd in her thorough,arcs.
not only the amenities Of life in that plens-
ant suburban city seem TO be threatened
with eclipse but even its security.
Those who know something of Elizabeth
can lay their hands on radical vice In It's
fiscal management, which, however, is 10y no
system oftax assessment and collection calls
for sharp investigation and thorough recon-
struction. II is computed. "a We have
said. that the taxable property Of the
city, which at present Is set down at
not much more than twelve millions,
would. upon strict application of
an equitable rule. aggregate nearly
three times that figure. That is the
belief oI the majority Of honest aud intelli-
gent citizens. and we may add that IL is
also the conviction Of the citys creditors
In other words, the interest account which
at present represents an annual tax of some
three per cent. on n spurious appraisemcnt,
would on an honest valuation represent no
more than one per cent Ii Is true that ccr-
tain taxpayers. corporate aud individual
who have heretofore contrived to shift the
bulk of their own burdens upon thclr fellow
townsmen. would be brought under the
wheel. But the city would right itself and
might reasonably look forward To new era
Of prosperity Let the taxpayers as body
see 10 IL that the business OF assessment
and collection is forthwith intrusted To u
committee %. the best citizens, OF competent,
upright, ana energetic men, who have prop
crty and reputation to lose, and they will
find their ovcrturcs of compromised met I'm
different spirit by tho holders Of city bonds
They would probably find it easy to get ac-
commodation, but, what is better, they might
not need it.
Until they can point to more vigorous
measures than have yet been taken. and
show an unhnching purpose to bear the
necessary sacrifices we advise our friends
In Elizabeth not to talk much about COM
promise. II is scarcely the moment for
insisting on n reduction in ratios OF interest
which thoy agreed 90 poy, or for impusning
the validity of any part of debt which has
been formally recognized. And AS To- the
threat OF total or partial Reputation, it
might be we'll to examine the legal question
by what means they would contrivo to cvade
process We cannot believe they would con
seat 10 follow the example Of Memphis, and
| by securing a repeal Of their charter, de-
grade Elizabeth city into n mere tax
ing district of the State Of New Jcr-
soy. They will prefer TO take the mat
/ ter into their own hands, and by n
/ system 81 rigorous assessment and hon
est collection, coupled with still more strin-
| gent rctrenchmcnt than has yet been COM
! passed, convince the citys creditors that
| they will bc paid in fall.