Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1886-06-26
THE CITY DEBT.
Another LETTER from Bond Commissioner
H. O. Beatty Upon the Subject.

the oath you Published an article by my
self on the bond question. l wish to ado
a few words more on the subject. l gave
in that article a statement of what the city
would have to pay on five different pro
posed bases of settlement. thought then
l had embraced the whole range of pro
posals. But it seems Mayor Brown pro-
poses 10 refund at 20 cents on the face Of
| the bonds and coupons, the new bonds to
| bear per cent. interest. This proposal
was made by Mayor Brown at a meeting
some two weeks since when was present
| but. being somewhat deaf, 1 did not hear
or rightly understand the proposal; hence
| did not include il in my last article.
| will say now this would require an ex-
penditure of ISL 400 per annuni for twenty
years to pay these new bonds. This would
be $4,000 year less than we are now pay
ing. But if l am right in calculating that
the Fund Commissioners can pay the debt
in thirteen years, it takes $3.50, 600 moret tax
to pay the debt than if it was left in its
present state. But the Mayor says it would
take the Fund Commissioners fifteen years
to pay the debt. Admit for the sake of the
argument he is right, still it would take
$500 600 more to pay it under the new ar
rangement than under the one we now
have. Is it worth while to issue new bonds
just for the pleasure of collecting $3.50, 900
for Daniel Meyer 81 Co.?
l think Daniel Meyer has been rather
badly treated by the people of this city ::
he has been soundly abused for trying to
collect what the Court says was legally due
to him. But | am not so liberal as TO be
willing to stand my share of tax amount
ing TO half a million of dollars to soothe
his ruffled feelings am willing to pay
my share of what the law says shall be
paid to the creditors of the city, but | am
not willing to help pay half . million more
than | am legally or morally bound to pay
| have been requested TO state at what
rate it would be advantageous for the city
to refund | will say that on close esti-
nation find that if the debt was refunded
at All cents on the dollar in per cent
bonds it would take just about the same
amount of money to pay the new bonds
that it would take for the Fund Commits
sioners to pay off old bonds. This is on
the supposition that the Fund Commits
sioners would pay in IL years with the
present income. If it would take Is years,
then refunding at So per cent. would be
lust as good and no better than the
old bonds Just as they are. Now
as to the difference of estimate between
Mayor Brown and myself l will
say I have been President of the Board of
Fund Commissioners for fourteen years. l
am very familiar with the operations of
the Board. and every year since L have
been on that Board Except when our hands
were tied up and we were not allowed to
operate) have estimated in advance what
we could accomplish with our annual in
come In every instance we came up to or
exceeded my estimates. In the ten years
| have never overestimated, and | am very
confident have not overestimated in con-
Guiding we can pay the debt in thirteen
years If citizens meeting or The Board
of Trade will appoint three of the most in
telligent financiers in the city-appoint
them from the different banks-men who
understand calculating interest, discount,
etc., think / can convince them | am cor
rect and Mr.. Brown is widely out of the
way.
Before closing, let me say a few words
about the operations of the Fund Commits
sioners. Everywhere l hear from the ig-
| norant part of the community, and not I'M
| frequently from those who ought to know
better, that the Fund Commissioners are
raising our taxes-making them so high
| they are oppressive; we are impoverished
| in paving high taxes; our real estate is I'M
salable and valueless. The Fund Com
missioners first taxed us to buy in our
bonds, and instead Of destroying them and
be done with it, they hold on to those
bonds, collect the interest on them, and
| thus take away the money from the treas
| ury that would otherwise be used to pay
Davis, Meyer and other creditors of the
city, thus preventing the taxpayers from
paying the debt instead IF helping them.
What are the facts? The Fund Commits
sioners did cause the people to be taxed,
| from 1872 to 1881, in the aggregate, say,
| $212, 0S6 0S, with which small sums they
have taken up over million and half of
| the city debt. But for the last five years
the Fund Commissioners have not caused
| the people of the city TO be taxed one single
dime. 1t is true your taxes have been
constantly increasing and have been con-
stantly squandered in foolish and unneces-
sary litigation, nearly all of which could
have been, and ought to have been,
avoided.
Now, about collecting interest on the
| bonds we bought with the peoples money,
| and thus preventing them from: paying
Davis, Meyer e. Co. 1t is true we collect
| the interest annually on the bonds we
bought with the peoples money. But we
do not prevent the people thereby from
paying Meyer, Davis & Co. We enable the
| l'tN.ltlC " pusf LAWS ~ W. q Il cat
| deal faster by that operation. will try to
| make it plain
| Daniel Never got decree, or order, of
| the Supreme Court directing the Trustees
! to levy annually tax of one per cent. on
! all the taxable property in the city, and OF
| this one per cent. to set apart 55 thereof as
| fund out of which to pay the interest on
| its bonds. Now, this amount has to be
raised to pay the coupons and bonds as
| long as there is one bond or coupon out
standing. Whether the Fund Commits
| sioners are operating, or driven out OF
existenre, the same amount has to be raised.
This levy brings about 100000 year into
| the sinking and interest fund to pay Daniel
Meyer sud other holders of coupons.
| Next spring Mr.. Putnam, if he ,emains
| Collector, will collect this 100000 and pay
| it to MI Porter. Daniel Meyer, we will
| but that of all the bondholders, brings
| 100000 of coupons, and says to Mr. Porter:
| Take these coupons; cancel them, and
pay me that $50 000." Mr. Porter says
No, | can't do that; the Fund Commits
sioners are creditors of the city, as well as
yourself and friends. OF the 60,0G0 oldest
coupons they have $4,000; you only have
$4,000. l will pay you $4,000, and the
Fund Commissioners 10000" And so he
distributes the money. He cancels the
$50, O0O coupons handed in by Meyer, and
| also the $4,000 from the Fund Commits
sioners. That's sixty thousand dollars of
the debt taken up. Then the Fund Com-
sioners turn round, and say TO Meyer, We
will take your coupons, but we must have
| $50 eco for our $4,000 in cash-and they
get it. Now, then, Mr.. Porter took
| 100000 of debt with this $G0O00 OF
cash. And the Fund Commissioners
take up 100000 with a part of the same
money So through the means of the Fund
! Commissioners there has been $4,000 of
debt disposed of. But ii may be said $4,000
of that belonged to the city, so that don't
count. Well then let us throw that out,
and still $50 900 of Meyers coupons have
been disposed of. If the Treasurer had paid
this money to Meyer & Co., he would only
have paid sirty thousand Of coupons in
stead of eighty. So the Fund Commits
sioners are not hindering the people from
| paying Meyer e. Co., but are helping them
! Fl. o. BEATTY.
| Sacramento, June %, 1886.
PRISONERS En- RoUTE.-Sherif Mcclellan
of Butte county, brought down yesterday
from Oroville, en- route to San Quentin
| two prisoners. One of them, Anna Thomp.
son, pleaded guilty of grand larceny, in
stealing hog in December, 1885, and was
sentenced to 10 years imprisonment. This
/ fo,-,, lie to hepip aft ba a a form