The record-union., 1892-01-27
MARKETING IRRIGATION BONDS.

citizens abroad.
MARKETING IRRIGATION BONDS.
c. P. Huntington, President of the
Southern Pacific Company, has taken an
active personal interest in securing to the
legitimate irrigation bonds proposed to
be issued by the irrigation districts in
California the highest market. Mr..
Huntingtons interest was enlisted from
the first in these schemes, but application
being made to him by representatives of
the various districts for assistance, he
very cheerfully undertook TO investigate
the money markets and to personally
introduce this class of security to in
vestors.
The irrigation districts organized under
the Wright law are offering in the aggre-
gate about SlO,OO0,OOO of securities at face
value. 1t is scarcely to be expected that
all the securities offered are equally
solvent or equally meritorious, and it is
very probable that some among them are
not only doubtful, but actually bad. 1t
is not to be expected that in every case
the money obtained from the sale of
securities will be legitimately and eco
nomically invested in irrigation works.
1t is not to be expected that all works
projected will be judiciously planned, or
that in all cases the land affected by the
bonds will be good security for the re-
payment of money invested in them.
The question has been how to separate
the good from the bad. The knowledge
which establishes this distinction is pos
sessed by the irrigatOrs themselves. The
State Association of Irrigation Districts
comprises thirty organizations The
State Association, by resolution, declared
that it was its object to irrigate every
inch of dry land in the State which could
be successfully irrigated, and to honestly
pay every bond, principal and interest,
which may be issued in furtherance Of
this work.
In entering upon the task of assisting
the representatives Of the State Associa-
ton to market their securities, Mr.. Hunt
ington has suggested that all the first
class irrigation districts of California be
consolidated so as to issue one bond to
one trust company; that all individual
district bonds be as collateral to this one
issue. This would equalize and average
the value of the one paramount bond,
and yet distribute by collateral bonds the
burden of repayment over all the districts
in proportion to the money used upon
them, and also in proportion to the value
of the property within each individual
district. In this way the irrigationists of
California would become responsible for
the character of every district admitted
to the association. Each would be sponsor
for the other. In this way the single
bond issued would sell at once and at
very much higher figure, and the distri-
button of taxation for the discharge of the
collateral bonds as against each individ-
ual district would be at the risk and
charge of each. Thus investment would
be made in the way of subscription to the
single bond representing the aggregate of
all bonded Indebtedness of the irrigation
districts.
[ In a recent communication on this sub
iect, Mr.. Huntington says:
''Of course it goes without saying that
I shall do all can to market these bonds,
and that, too, at the highest rates at
which they can be sold. By the high
est rates 1 mean the rates that ought to be
obtained for a first-class security; but 1
myself must be satisfied that they are
really tirst-class security, before I can
recommend them. Simply to show that
the water and the land are there and that
the latter can be benefited by bringing
the water on to it, is not sufficient. 1t
must be shown that the money paid for
this irrigation is to go into the project,
and not into the pockets Ola few who are
manipulating the schemes. have very
clear and distinct views myself upon
these questions, and shall endeavor to
impress them upon the investing public
whenever am satisfied they they will
make no mistake in putting their money
into these securities"
In addition to this, Mr.. Huntington ex-
presses his profound conviction as to the
ultimate value of the securities when the
districts are so consolidated as that the
whole interests will be unified and stand
ing together.
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