Birmingham age-herald., 1895-03-17
Governor Oates Finds Her Bonds
 Considered Too Valuable
AMONG MONEY MAGNATES,
And Fails in His MisSion-HiS
 ExceIIenCy and the State st Gilt Edge.

NEw YORK, March. 16.- ISpecial-1 l. Quite u breeze was created in financial cir cles yesterday when it became known that Gov. WilliamC. Oates was in the.city and il was generally understood that the pur- pose of his visit was the fandIng of the state debt. It is well known to many of your readers that the state of Alabama owes nearly S7, 900 ,000 of class A bonds at pres ent bearing per ceut interest; that next January the len-year period of per cent expires, and until 1906, or unless sooner exchanged, will bear 5per cent. Sbe owes s578, ,cO0 of class 5 bonds now bearing per cent, which added to tue A bonds makes S7, ,500, ,000 of bonded debt bearing per cent ana will require for payment of anpual in- terest 1875, ,000. There are Of class ''C'' bonds, bearing per cent interest, s963,. O0O interest to be paid thereon S3S, ,520 an ,nually. The "Seay' bonds, S954 ,0O0, bear ing per cent, will not mature till 1920 and will therefore not be subject to be called for redemption until that date. All the other bonds mature and are subject to be called for redemption in 1906.
 The law recently passed by the legislature authorizes the governor 10 exchange new bonds for any or all of the outstanding bonds, providing he can thereby reduce materially the amount of interest which the state pays. The law authorizes him 10 offer 10 present holders, as an inducement to exchange for their. present holdings, tifty-year bond, and agrees to pay said new bond, interest and principal, in gold. A reduction of l per cent in the rate of in terest would save to the tax payers of the state nearly $100, 1000 per annum.
 he ia doinn a Ia a n c- complish this, but the passage of the law has so strengthened faith in the credit of the state that the bonds have gone up to such premium that Governor Oates sees he can do nothing at present, and returns home 10 await change and fall in the premium. He thinks, however, from his observation, and after carefully analyzing the opinions of various financial magnates with whom he has come in. contact, that an immediate fall in the premium is ex- tremeiy doubtful. That act not only strengthens the credit of the state, but a'so of lhe entire business community of the state as well.
 The governor will not weary in well do- ing, tut will try it again later. He has many acquaintances and friends among tue bankers and monied men of this city who will aid him materially in his effort to fund the state debt.
 To your representative he remarked: My hope is that the offer of an extension of fifty years on-the new issue will be a sui fcient inducement 10 the present owners of the S7, ,5C0 GOO class A and B bonds to tempt them To agree 10 funding of the entire amount at eDce.
 A slight discrepancy between tbe official publication Of house bill No. S73 in the Advertiser ot recent date and the pamphlet published created quite disappointing stir. great many bankers and bond men had gotten hold of copies of the Advertiser immediately after the da.e of publication and had an idea the governor was author ized to issue any amount oi bonds his wis dom dictated, and were very much aston- ished when he informed them that the constitution prohibited the governor from increasing the state debt, and when his att tention was called to the newspaper copy he immediately quoted the language of .he constitution and read copy of the a,t printed in pamphlet form, several of which he bad with him. The | error occurs in the fifth line Of the first | section of the act as printed in the Adver- tiser by the omission of the word snot," and between the words "ainount' aud "exceeding.'
 There was evident disappointment, as a | prominent banker, who is largely inter- ested in Alabama. remarked to your repre- sentative: "Why, sir, we were laboring l under the impression caused by reading | the newspaper copy Of the funding law that | the government would issue and offer at l least s30, ,000, 900 of bonds, which would be | us rapidly taken at 31 per cent as will your &, ,500 ,0CO. Thirty million is no debt for | such a progressive state as Alabama You | are living in the shadow of a consultation l created when Alabama was considered an | agricultural state alone, and one of the 1 poorest in the union for her size. Now her | mineral and manufacturing development | will warrant more liberal constitution |
 If any man in the state can arrange to | have the debt funded Governor Oates is that | man. Alabama is extremely fortunate io | having for governor man in whom the | financial mag mates of this, the money cen ter of the United States, have the utmost | confidence, and who will be able in the | near future 10 save the state great deal of | money.
 His excellency left for Washington this afternoon at 1 o'clock, where be will stop over until Monday and then proceed to Montgomery-so he informed your repre- sentative at parting.
 CALLED TO NEW YORK.
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