Shenandoah herald. [volume] (Woodstock, Va.) 1865-1974, 1886-11-19
THE VIRGINIA DEBT.
A NEW PROPOSITION.


a new proposition for the settle
meDt of the State debt is submitted
to the people of Virginia by the
representatives of holders of bonds
bearing coupons receivable in pay
ment of taxes. Stated briefly, this
proposition Is an offer to accept
such rate of interest on the prlnci-
pal and overdue coupons Of the
bonds in question, aggregating
about 500, 1872, 900, as can be paid
with the present surplus of the
State treasury, after full provision
has been made for certain specific
objects, namely, the general ex-
penses of the government as now
appOrtiOned by law; the expenses
OF the free schools as now provided
for; the amount required to pay in.
terest on the Riddleberger IS. Ac-
cOrding to this plan operations IN.
der the Riddleberger act would be
suspended, and new bonds without
tax receivable coupons would be
issued, to ruI forty years if the
State so desires, and to be redeem
able at the pleasure of the State
1t is not designed, however, to sur.
render the old bonds with their tax.
receivable coupons in exchange for
the new. The old bonds are to be
deposited with a trust company in
New York or Baltimore, and the
company, when a halfyear's inter.
est Oh the new bonds shall have
been paid TO it by the State, will
cut off the balf.year's coupons from
the old bonds and deliver them to
the State. Should the State at any
time fail to pay the interest fallen
due on the new bonds, the tax.re.
ceivable coupons could again be
brought into the field, as at pres.
ent, to intercept the States reve-
nues. For the State the advant-
ages of the proposed arrangement
would be the cessation Of coupon
suits so long as the interest on the
S25, 100000 OF new bonds was
promptly met, and the certainty
that there will hereafter be no need
to increase taxation IT, meet inter.
est on the State debt. The princi-
pal of the debt would, 1t is true,
from the readjuster's point of view,
be increased, as the plan recognizes
as valid the gross amount of the
cOnsOl and McCulloch bonds, and
imposes fresh obligation to pay
it, together with interest on $4,000.
900 OF overdue coupons, but the
taxpayer is in no event to be call.
ed upon to pay more than a given
sum annually in the way OF inter
est. Nor is he to pay less. If the
State sees fit to increase it's expend-
iture for general purposes or gov
eminent, or for the public schools,
it will have to increase its rate of
taxation. The amount to be paid
semiannually into the hands of the
trust company is fixed and invaria.
BILE. What would be the status of
the new bonds when the old have
matured and the taX.receivabIe
coupons have all been exhausted,
is not stated. The offer Of the
bondholders looks like a concession.
Their cOnsols at present bear 6 per
cent, their McCullochs 4 per cent,
but they are willing, it may be in.
ferred, to accept little over per .
GEN.. on their 5000, 600 Of claims. /
The annual surplus Of the State, /
which is at present devoted to the /
purchase of Riddleberger tbrees, if .
divided as proposed among the
bondholders, would give them, it
IS estimated, about that rate of in.
-erest. Whether the people of
after having declared
through the platform Of both
political parties that the Riddleber-
ger bill shall be the final settle
nent of the debt question, will re-
GIVE with openness Of mind any
lew scheme, however attractive, in.
the recognition of the va
idity of the total amount Of the con.
ul and McCulloch bonds, is as yet
Uncertain. A considerable number
# Virginia papers of both parties
ecelve the proposition outlined
bove with favor, their objections
0 1t, if any, applying to details.
he vOtsrs may in the end come
ound to it, but they have a long
1ay round 10 come Bait. Sun.