The New Orleans daily Democrat. [volume] (New Orleans, La.) 1877-1880, 1879-01-08
THE NEW ORLEANS DEMoURAT, WEDNESDAY, JANUARY g. 1878

ASOOe
doubt that the funding Of these bonds would
80 Increase the volume Of the funded debt,
That the coupons OF 1874 1876 and 1876, at
tached to the bonds TO be funded. would not
be promptly paid
The government was entering upon its tI,,-
ties under the most adverse circumstances.
The people poor, outstanding personal in
debtedness large, State, parochal and NUM-
cipal affairs suffering from the nismanage-
nent and spoliation Of the past, the books Of
the State had been distracted, and the opera
tions OF the government retarded for causes
not now necessary to fecapitulate. Under
these circumstances the Board Of Liquidation
was called upon to elect Fiscal Agent. The
advantages of the position, so far as the legal
duties are concerned, were all In favor OF the
agent. 1t was suggested that possibly these
advantages were so great that the Board
might utilize them for the obtaining Of some
corresponding advantage to the State. The
result OF this suggestion was an announce
ment by the board In the exercise Of their
power OF election, that they would not con-
sider any person a suitable candidate who
would not be willing to cash the coupons
The contract with the Fiscal Agent was to
pay the coupons Of No. Q, January 1, 1875
No. 4, January 1, 1876 No. G, January1, 1877: .
No. 7, July !, 1877; No. 8, January /, 1878.
1t Is to be remarked that the state con-
tracted no obligation under the promise. It
was to pay no interest. The Fiscal Agent tn
be elected, was In reality to take up the par-
ticular coupons and to wait for payment frora
the interest tax as collected It is true that
the board agreed to elect for four years but
all parties knew that this provision was SUBJ
ject to the power vested In the board OF re-
moval for cause, and subject also to the full
control Of the GeneralAssembly over the whole
subject matter. Prior to the announcement
by the board OF what 1t would consider neces
sary to make candidates eligible, II may use
the expression, It was generally supposed
that there would be number OF applicants
Tor the position, but on the day Of election
only one single candidate offered-the preseat
Fiscal Agent-who was consequently elected
The State National Bank was elected. and was
qualified, and has carried out the obligations
under the stipulation Of the board. 1t Is the
holder OF coupons which are yet unpaid, about
tne IOllOWlng amounts:
1877, funds OF 1876 .............. s7s.547 90
January, 1878, fund OF 1877. ....... 125,oD 90
Iocai. \. s...s...,tf..tas...s S1D5,4H %
With the payment Of the January coupon
Of 1873 its obligations, under the stlpulations
imposed by the board in electing the agent.
ceased, except In SO far as coupons OF former
years. covered by the agreement and annexed
to bonds yet to be funded, after that date, are
concerned, and, therefore, both the agent and
the board fell under the rights and duties OF
each, solely and exclusively, as gagged by the
law. Under this condition Of things, when
the July coupon Of 1878 was about becoming
due, and 1t was apparent that delay would
occur. the Fiscal Agent agreed 10 make a fur
Their advance for the purpose oil securing
prompt payment. The attention OF the Gen
eral Assembly Of 1878 was called TO the
stipulation made by the Board OF Liuui-
dation In electing the Fiscal Agent.
and to the advance made by the Fiscal Agent,
in cashfug coupons covered by the obligations
assumed. Act No. % OF the Extra Session
provided for the reimbursement of the Fiscal
Agent OF the amount Of his advance, together
with the 5 per cent interest thereon from the
redemption Of the debt fusd,e fund to be
composed Of any surplus as mentioned In the
funding act and article Of the constitution
to which referred. / could not give my ap-
prevail to this enactment; first, because 1t
seemed TO allow interest to the Fiscal Agent
from fixed past date, without reference to
the time OF actual payment; and, second, be-
cause 1t delayed the application OF any sum
to the credit Of the redemption OF the debt
fund. until 1t reached the sum OF the advance.
thus compelling the State TO pay interest on
the entire advance. although means to make
partial payments would be on hand
and deposited with the Fiscal Agent.
These objections were, at an early date. COM
to the Fiscal Agent. The enact
ment finally received my approval few days
before the maturity Of the July coupon upon
The presentation to me OF formal waiver on
the part OF the board Of directors OF the Fiscal
Agent OF what / conceived to be the objec-
,ionable features OF the law. NY opinion
hen was and now Is that the provisions of
ict No. Is OF 1878, giving interest were only
applicable to advances made and to be made
~ the Fiscal Agent, under the arrangement
,ntered into at the date OF his election, and
hat the interest on the advances made in |
July, IL deemed proper, would have to be pro- |
'ided for by additional Legislation, the adj |
,ances having already been paid and the in !
crest being for small amount. As the
,eriod for the payment Of the coupons of
January, 1879, approached, 1t became obvious
hat the sum to the credit Of the interest fund
or that year would be inadequate on the first
Il January to the prompt payment Of the |
coupons.
When this fact became reasonably certain
he Board Of Liquidation invited and request |
d the Fiscal Agent to take up and hold for
to account the January coupons until moneys
ould come In to pay them. This the Fiscal |
agent declined to do, for the reasons assigned |
" it In q communication addressed to the
'oard, expressing, however, willingness to |
esign the agency to any bank which would