The Bolivar bulletin. [volume] (Bolivar, Hardeman County, Tenn.) 1865-1888, 1885-05-29
TIE STATE DEBT.

I've state DObu5 Whlcn were sought
to be collected of of the railroads by
their holders may exhaust the funds
IN the state treasury and embarrass
the state in promptly paying the in
terest upon the bonds which have
already been funded. to obviate the
difficulty likely to arise in that con-
tingency, makes the following recon-
mendation;
1T is recommended that the fund
ing board, in order to the execution
Of the full purpose Of the funding act
Of 1888, be further authorized and
required in such cases when a bond
IS hereafter presented for funding,
that the interest past due thereon, as
represented by coupons Of and from
July l, 1888 to July l, 1885, inclu-
siye, shall by said board be incorpo-
rated 10 the face value Of the new or
settlement bond issued in lieu thereof
and that the coupons on SAID new
bond representing interest due on
and from July, /, 1888, to and in
GLIDING that of July 1, 1886 shall be
cancelled by said board.
It's the part of wisdom and states
manship to look ahead and see diff
eulties which may arise in in the ad-
ministration Of governments and to
provide to meet them when they do
arse. We can see how the state may
he embarrassed BY the funding Of all
its outstanding obligations within
short time, provided that nothing is
done to prevent it. and we ara not in
favor Of allowing the state to be plac-
ed IN that embarrassing position. At
the same time we do not believe the
best interests Of the state would be
subserved by adopting the recommen-
dation of the governor. The 50-3 act
provides that the funding board shall
add to the face value of the outstand-
ing bonds, the coupons maturing up
to the 1st of July, 1888, and one-half
of the total sum Of each bond shall
be funded into coupon bonds bearing
interest at the rate Of three per cent.
per annum. And we understand the
governor to recommend that the sos
act be amended 50 as to include in
the now three per cent. bond the IN
terest which natures on.the old bonds
at It's original rate, for the two years
commencing July I, 1888 and ending
July / 1885. Ia other words, it is
proposed to fund one half of the in
terest maturing in that time and put
it into the new three per cent. bonds
and make it principal, to bear inter
est at the rate of three per cent. per
annum. We don't know how mach
Of the debt has been funded, and how
much is still outstanding. We under
stand the whole debt amounts to
about $4,000, 1000 and that about
SO, 600 has already been funded,
leaving about s20,000,00O still out
standing. The interest upon the
outstanding bonds for two years, at
six per cent, would be 81. 400, 900.
To fund one half of this amount into
three per cent bonds would add ST.
100000 to the principal of the state
debt. and add $4,000 per annum to
the interest account. We are oppos-
ed to converting any more of the in
terest upon the bonds of the state into
principal AMI make it interest bearing.
That policy Is a bad one, and is the
prolific source Of all our trouble in
this state on the debt question. The
people Of Tennessee having been kick
ing against that policy for years, We
are stgenuousIy opposed to going
back to it again. More than onehalf
OF the state debt is interest which the
state was unable to pay and which
was from time to time funded into
interest bearing bonds. The holders
Of the outstanding bonds have had
more than two years in which to fund
their bonds and they pefsistently re-
fused to accept the provisions Of the
sos act and many of them have de-
clared that they would not fluid I'M
der il. In view of this fact, the leg
islature, now in session, should net
presume that these holders of Tennes-
see bonds VIII come up and accept
the provisions made for the funding
Of their bonds and we think they
should not provide for that contingen-
cy. But to prevent any possible en-
to the state, we suggest |
that in the appropriations bill they |
provide for the payment Of the inter-
est on all bonds funded up to a certain
late, say June LIST, 1885, and have
he next legislature to provide for the
payment Of the interest on all bonds
Lndcd after that date. It occurs to
is, that this would be much better
han to fund the interest on the bonds
which have been held back fer two
.aqve int0 yrincinal and tharab, ola