New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1884-03-11
THE CITY SINKING FUND.
ICED OF A CHANGE IN THE LAWS


THE PRESENT STATUTES SOURCE OF DANGER
The bill "to improve the condition and oper-
aops OF the Sinking Fund" Of the most important
measures concerning this city, before the Leslsa
ture II was recently introduced In the Senate oy MI
Gibbs and in the Assembly by Mr. Van Allen Inc Oil
has the written approval OF such nancies and buslness
men as Jacob d. Vermilye, @. q. williams, John A.
Stewart, william A. Booth and IL. b. Cianln'
and of 80 able a lawyer exJudge Emott. Ihey
state that they "have examined into the stution ana
operations Of the sinking fund Of the city, and ne
eve that the passage Ofthis bill "wi be In furheranco
OF the objects for which this fund was created VIII insure
and perpetate it's security and usefulness; Will remove
threatening Of public corruption, ana Is urgently
called for in the public interest"
The operation Of the city sinking fund, under the act OIL
1878 and previous awss generally understood IL was
established to secure the payment OF some OF the earlier
bonds Including Water bonds Municipal secur-
ties were more novelty with Investors then than now"
To facilitate their negotiation they were naae cnako
upon the sinking fund. and certain fixed revenues OF e
CITY were inalienaby devoted to 1t until the last claim
against It paid These are derived from forty
dsttnct items such rs dock. market ferry and water
rents licenses franchises. fees, fines, penalties etc.
They necessarily grow with the city, rue entire revenue
from such amounts TO SHOOOooO' oi "hion
s.. 900 900 goes into the sinking fund Ihis laCtr
amount increasing at the rate OF about SJOOooO ahu
ally. and under careful management may be made to
"A
years have been made payable from taxation ana not
from the sinking fund But it has been made appcaoe
in the discretion OF the comnssloners 20 te Ry
dice the sinking fund bonds. Another speclh Iuu was
created by act Of 1878 TO redeem the cy Oons
after that date. But all bonds issued sIhce tuae tIo
have been taken by the sinking Fund Commission except
a small amount recently sold to the pubic. tr.
Under the clause IN the state constitution ts
sinking fund will probably have to remain In eKstehee'
with IT'S ina e0a neo S bonds
made a charge upon it become due These bonds dia%
high rate of interest. Their average yearly ma!uriy,
during the forty Our years VIII DC ie nresent
luahenabe revenue Of the sinking lund al Tue present
time exceeds S5OOOOOO Inc theory upOn wNiVn othr
fund operated Is to invest us surplus ~ H.
city bonds and hold them uncanceued that
the 1 the f5S At tbe present time 100000
nuay raised by taxation To the city Interest on ~
ali maturing bonds, the fund increased H4OOOOOO mere
will he only four years in the next forty Tour years Guilg
which the fund must continue when the amount OF bonds
OF all clas-e. falling due will exceed the present income
of the sinking fund. The fund now amounts 70 SSs,-
ton compromising interest and increasing s1rpue ItEe
nues viii amount in sixteen years to over
and yin thereafter multiply ~ an enormous rate. ~,
=, Inc a'erifS !eIy ~ Years is So $50 656 The
terest last year S7,2Jlljl without taxing mo &C
coun the large item and the increase IN the
present resent fixed yearly income all the bond
have a yearIy surplus OF nearly $20OO,OOO besides.
Thcuecessy tor change sooner or later Is yea
The fund viii absorb and hold unpaid the ellre cy "
Besides ia opinion OF tnc men wno ask lot inc Ps7
100 of fine law on tine subject the demand or the shhS
fund surplus for investments oilers altogether Uoo c'9y
a method increasing the gross deDt ~Au 80
keeping up high taxation The existence OF inns .iVI
mO, fund. the possibility or its diversion At luc
hands OF such officials ruled the city not mduS
wears ago. ana rule n again, MAKE
it, in the opinion Of Mr. Nermhye anu VV,ucea >
an element Of danger II has cost the city nearly S4DoO
600 to make good Its part OF the state SINKING Iuu
which va, diverted during Twceds day ana me posSl-
utv OF a loss the same kind, they assert ought
10 ne avoided. Moreover the city taxing sc S-VVO,-
600 year pay Itself interest money ana ISSUING VsH
bonds Increase sinking iund when TINS money might
better be used directly to pay the city expenses CO.,
When any purchased Tor lne Oult'u 7tlt'7
sinking lund they at once cancelled Inc HoNeih-
mrnt officers allowed hold these bonds ucal-
&c led and collect interest tneI - Is done IN Ne"
YorA The city pay its debts with the eVldehces
oil IT'S own indebtedness; would it, creditors, III case
OF financial trouble, accept such security when tneIe
S3yO.OUOOOO OF real property 10 levy upon Hence Tue
hill now the Legislature directs the cancellation OF
ALL bonds sinking fund WOch are III eACeSS
of the stocks bonds. legal charge upon that
fund held by public II has been Thought pes 10 meet
auy possible legal objection, to mold uncancecd enough
bonds TO meet $50 100000 outstanding tCr inc pay
uent OF which this fund created But al bonus mere
alter acquired by sinking lund are 10 Dc al once
cancelled The law OF ISIS, under when Tue cry u an
uuAy taxed large TO increase the SINKING luhu 10
Tenealed such taxation SAID 10 be wholly unneces-
sarv. The surplus OF the sinking fhnd from
it, iuaIenabe income, exclusive Of interest, Will
nav several times the maturing bonds IN the next
forty-fOur years. aud still more than provide OT any IN
crease the city debt, the new bonds having MY years
TO , a.. .,rooa.os
add TO the OF the city bOudhOldefs reduce TAXA
ton remove large extent source OF puDuc ushgcI
while not mpSiring the sinking fuud Inc IacI tha Tue
measure has the approval OF some OF the Destkno
nancers of the city has led Senator Gibbs and Assembly
man Van Allen to Introduce IL IN the Legislature