Pittsburg dispatch. [volume] (Pittsburg [Pa.]) 1880-1923, 1890-10-14
CONTROLLER MORROW SAYS NoTApoL.
LAR HAS BEEN DIVERTED.

He is in Favor of Purchasing Bonds When
ever Obtainab1e-He Suggests Sinking
Fund Board-How the City Lost Money
by Being Paid Interest.
Controller Morrow, one of the defendants
to the suit, took hasty glance at the bill,
and admitted that some of the allegations
appeared to be correct, but he was rot pre-
pared to coincide with all OF them, nor with
deductions of the plaintiff. He said:
LET me impress upon you one thing. Not
one dollar of the sinking fund has been di-
verted from its proper purpose. 1t has been
preserved intact and inviolate. l have been in
favor of purchasing bonds whenever they could
be obtained rather than allow the money to re-
main idle. 1 pursued this course until 1885,
when the subcommittee of the Finance Com
mlttee decided that no further investment
should be made that would not return
80 per cent per annum. In my re-
port to Councils at the close of that year
said that an unwise restriction in favor of
the privileges of the Finance Committee which
was construed to mean that they should have
power to determine in each and every case
what price should or should not be paid for
with them or their representative before any
proposal for the sale of bonds could be ac.
cepted, had the effect of
Suspending All Purchases
for nearly two months. and would, if insisted
upon, have proved a cumbersome and needless
regulation. The language of the resolution re.
ferred to was not changed, but the Finance
Committee conceded to the Controller
the function of buying at will at a max
Imum price, but as the offerings of city bonds
comprise wide range of maturities and rates.
l was of the opinion that the best policy would
be attained by reposing discretion in the Con-
troller to act freely and upon his own judg.
ment, as to what loans should be purchased
and the prices for each that it would be wise
10 pay. All purchases should be reported to
the committee or to the Councils at frequent
intervals, which would secure, as far as at
present can be done. the interest of the city
against improper use of the investment funds
as there is no authority vested anywhere to
part with any securities that have once been
placed in the sinking fund.
Asking for a Sinking Fund Trust.
81 also recommended that the Mayor Con-
troler and Treasurer, who are under bonds be
constituted an ex-oficlo board to make pur-
chases for the sinking funds and that all
matters relating to the care and management
of the same be reposed in their hands, did not
care to assume all the responsibility for the in
vestment of this money, and therefore made
the proposition.
1--WE do not get any interest on our daily
balances, but we used to, and the city was the
loser thereby. Under an ordinance repealed
some years ago the banks bid for the privilege
of being city repositories, and the ones that
offered the highest rate of interest got the
money. Now the Old-eStablished banks doing
a large business would not pay much for the
privilege and were out-bid by smaller and less
conservative concerns. As result the CITY
lost large sums of money by the repositories
failing and going into bankruptcy"