The record-union., 1895-05-03

Mayors JabeZ Turner and John @.
Brown, it is not pro bable that any Trus-
tee since the days of ex-Mayor Swift
ever knew any more of the subject of the
city debt than the Mayor of Milpitas may
be supposed to have known. That diff
cult and unpleasant matter they left to
the Commissioners of the funded debt
sinking fund, doing, or emitting to do
whatever was suggested by the chief OF
the Commission.
In the meantime, not being able to pay
any more than 80 cents for bonds, al
though there was no restriction on the
price that might be paid for coupons, the
fund in the Commissioners hands was
rapidly accumulating. Still adhering to
the old policy, the coupons unpaid were
allowed to increase rather than diminish.
thus continually postponing the day
when the city could take up the business
OF redemption, and remove the last ex-
cuse for the existence of the commission.
AT length, to relieve the plethora OF the
surplus, the commission, in March. 1857,
procured an amendment to the law by
which 1t was authorized to buy bonds at
any price not above par. One can imag-
Inc how the San Francisco syndicate,
which had by this time obtained about
all OF the outstanding bonds, rejoiced. But
Tor this amendment they would have had
no customer for their bonds until such
to the lowest bidders. But for this
amendment. from the very necessity of
the case, the funds in the hands OF the
commission must have been used TO buy
up the coupons. The bonds of 1898 and
l9O3 would have awaited the time when
the city, from the moneys in the sinking
fund, would be ready to redeem them at
the lowest market prices.
The objects of the commission may be
further conjectured by its next move
ment IN the way of amending the law. In
March. 1889, it procured law by which
great ingenuity is displayed in q number
of amendments, all calculated to perpetu-
ate the commission, to increase tho funds
In its hands, and to provide Tor their in
vestment In the various classes Of Sac
ramento County bonds, California State
bonds, or bonds OF any county or lncor-
porated city in the State of California"
The old Act provided only that coupons
purchased by the commission should be
paid TO the President of the commission.
One of these amendments OF 1889 provided
that ''all money payable on any bonds or
coupons belonging to the com mission"
shall be paid to the President of the COM
mission. 1t is evident from this that the
astute Commissioner who devised the
change foresaw that the time was near at
hand when, the back interest being paid
up, redemption by the city would have to
be commenced.
This scheme provides for the payment
OF bonds which have been paid. In other
words, to pay the bonds a second time.
Every bond in the hands of the commits
sion has been once paid to the holder of
it, with the money Of the city collected
these many years by hard taxation,
heavy licenses and water bills, and now
comes this most wonderful invention of
modern times and demands the payment
again of the bonds, so that it may take
the money so paid the second time and
invest it in 1.-THE various classes of county
bonds, California State bonds or bonds of
any county or incorporated city in the
State of California" We have been doing
this all along for years with the coupons.
first paying them To the coupon holder
and paying them again to the. commis-
sion. This folly has been the means of
keeping this commission in existence far
beyond its lawfully predestined time. 10
give it further lease of life for an indefi-
mite period, by paying to it the redeemed
bonds for investment in any securities,
would be beyond endurance. 1t is high
time the people Of Sacramento should
throw off the lethargy which too much
eating of the insane root has laid upon
their faculties.
Fortunately. the Legislature at its last
session passed law which enables the
city to fund its outstanding indebted ness.
1t does uot owe this Funded Debt Com
mission one cent.
OF course it will not recognize it as one
OF its creditors, for every bond and every
coupon 1t holds, or claims To hold was
bought with the money OF the city. This,
of course, 1t does not deny; yet for some
inscrutable reason, outside of the mere
desire to still pose as the controller OF the
city debt, and to keep up that holy show
until time is no more, it is understood
that the members OF the commission are
indignant and aghast at the proposition to
refund the outstanding debt.
Their occupation of dickering with the
San Francisco syndicate would then be
gone. But this Funding Act is the only
relief the city has from the prostrating
and paralyzing effects of the present con-
dition, which exacts 55 per cent OF one
per cent. OF all it's annual revenues to sat-
isfy the law as it now is to meet the de-
mands of this would be Immortal COM
mission"
The advantage of refunding are so OBJ
vious that 1t is strange that there should
be any objection TO it. A per cent. bond
can be fioated more readily now than a 6
per cent. bond could have been ten years
ago. The amount to be refunded is in
round numbers the sum OF S750000. This
is what the city actually owes, including
all bonds and coupons past due and to
become due. Thirty thousand dollars
per year pays the interest. We are now,
and during the past seven years, have
been scooped to the tune of an animal
average OF about $4,000. the following
being the exact figures of the receipts of
the int rest and sinking fund:
Year ending April 1, 1SS9.aS116,O52 81
4 . O. r-o