The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1896-08-23
he OBJECTS TO GOLD PAYMENT.
Also Saws the Taxpayers Cannot Meet
the Increased Interest,
No Usc OF Issuing Bonds. thu Mayor
Says. Only TO Default Better TO Let
the Warrants stand - The Council
Fails to Pass the Ordinance Over
the Veto.

without his approval The mayors chief
objection 10 the ordinance which provided
fer the funding OF s>1o.esa cf warrants. with
accumulated interest of SSaAeco. was that
the Interest on the city's increased bonded
Indebtedness would be beyond The ability
az the taxpayers to meet. In the face Of
this condition OF affairs, Mayor FaNcest
thinks II wiser 20 allow the interest on the
warrants 10 20 unpaid. piling up at the
rate OF s and 10 per cent. The mayer fur
Their objected 70 the clause in the ordi-
nance which provided that the bonds shah
be payable in gold coin. which sac eharae-
terixes as an attempt TO discredit the
money OF the United States.
In the present depiorabIe condition OF
the city's finances. In which all of the
tax levy save enough 20 pay interest on
the bonded debt - tied up nv an order of
the court. and the city employees are re-
ceiSing very small part of their salaries.
the mayors veto is worth reading. it Is
as follows.
.sro the Honorable. the City Council
Gentlemen; I herewith return ordinances
Ne. 1.i2e. entitled An ordinance to pro-
vide for issuing Of funding bonds with
wAich 10 take slp and cancel tho inaebt-
eaness OF the city or Tacoma. evidenced
by Warrants ISSUED between the i4th day
OF August. 1898. and the 18TH day OF June
1895. now outstanding and unpaid with
my disapproyaL
Under the law upon which this ords-
nance WAS based the city may fund its out
standing warrants issued within the con-
stituslonal limit and those validated by a
vote Of The people. but none other. That
any of the warrants proposed 10 be fund
ed by this ordinance were issued beyond
the constitutional limit cannot be scrl-
ously questioned. The city government
has acknowledged this fact for more than
year past, and no warrants have been
issued for that reason. except when there
was money in a particular fund to meet
their payment Such being the true con-
dftion of aur financial situation. IL does
not seem honest 10 issue a bond contain
ing a recital that in the issuance OF this
bond no constitutional or statutory lmi-
tation OF debt has been exceeded This
recital appears upon the face of the bond
set out in this ordinance This state
ment being untrue. | am unwilling to he
VI party 10 any statement which Is so mis-
leading that all connected with IT may
fairly he charged with attempting TO fund
our Warrants on false preienses.
'+The city has outstanding at this time.
city hall bonds s20An funding bonds.
sas0.Oo0. water and light bonds, s2oso. .0eo,
bridge bonds. si1o.eo1
''rhe interest on the bonds iTss mostly
been paid with borrowed money. for the
reason that money derived from taxation
was Insufficient for the purpose. The
proposition here is 70 Increase our bonded
debt and to oblgate the city TO pay In
terest on these bonds every six months.
The difficulty heretofore experienced IN
raising money 80 meet the interest on
bonds now issued viii not be diminished
by issuing more bonds. The city and
county delinquent tax list clearly shows
that the people have not the means 10 paw
their taxes The fund from which we
nave heretofore Borrowed TO meet our
interest payments IL exhausted. In this
condition OF things I do not consider u
good policy 20 issue more interest bearing
horsle. making the default OF the city
inevitable.
..The holders OF warrants are obliged 30
wait until there is money in tine treasury
te nay them. but when you exchange these
warrants for interest bearing bonds you
must each year levy special taxes TO meet
that interest. These special taxes mean
Rn increase Of taxafion. when 10 II eyf-
dent the people can not pay the rate pow
levied.
1T IS also a questionable measure Of
economy 20 add S900.0o of interest 20
the face value of the warrants and 10 e1-
change these warrants for funding bonds.
by which we agree TO pay interest. even
II the legality OF such transaction ~
unquostioned
~fn 1sr the legislature OF the state
rassa~a an act entitled AN act prescrib-
ing the manner ~ payment or warrants,
which contains the foiiowin. proFiSa
Provided. that no compound interest
shall be paid. directly or Indirectly. on
any Of said warrants This Law has not
been repealed. and when you compute
the interest due on the warrants and adj
this 10 the principal, and give IN eH-
change for the warrants bond IN an
equal amount TO the face value Of me
warrant with interest due on the wAf-
rant added thereto. you violate both the
letter and spirit of the law
This ordinance Is also obteciionable be-
cause II provided that the principal and
interest must be paid In gold coin OF the
United States. The warrants are payahia
an lawful money OF the United states
lawful money OF the United states -
good enough for The ordinary citizen ami
Il should be good enough Tor me h"na
holders. I am not willing 70 subscribe 70
any act which tends % alscfedit the law
ful money Of fas United states
and beyond All this. we have no assar-
anre that auy good can be acco ompiisncf
by this ordinance. No man holding a
warrant drs wfng 70 per cent Interest.
a fgelt the legality o. which there - no
question. viii exchange his warrant for a
questionable funding bond. When he
taxes a bond the identity ~ his warrant
ss laxs. and ~ the bonds are declared Nle-
sraI he nga nothing left but bis void bond.
business men will hardly. under the cir
srtuastanep@. take these bonds IN eH-
change for their warrants. The payment
rs rnoney can only secure the surrender of
sh.se warrants. and Hheu great city
lfka %ew YORK cannot md purchaser
for 90 4 per cent. bonds. what hope -
thsre OF selling the bonds Of tns city os
Taeoma FOR casag
and n these hOn4a cannot - sold for
cash il VIII result IN this. Those ho3osng
srgestjonahle warrants viii exchange them
for bonds. bat not en0ugh warrants can
he funded % snahle the city 70 uss the
money Il has. ard the very object sought
% De accomplished by tais ordinance viii
p~ava 10 he a failure i car beHshi Only
those Who hold warrants the Legality OF
"A ageh i questioned. who. - making eoe
e-xehangs get a bond 20 fAs payment OF
whsrh Ire city can make no defense
II ara % The opanloH that the legal valid
warrants should bs segregated from those
whara nav. been paid. faAf provision
sbss,3a b made Tor their payment. and
fhas alt warTanss once paid should se tg~
.gorsa ssata tns courts compel the city 20
aekrozTsesEe them a. existing obligations.
pv asapttrr ta8s course tha ctty would
tsrsw fsss exact amount % warrants 70 10
,srsvsass fsr. A. v. FAwcKT~T, Mayer"
yTssr ne veto hs1 ben read a motion
as male % pass the 0rdtnaocs OYER if.
kfs moi receiving tne necessary fs5-t1iftis
vote yxas lost TIE vote NaH. Ays@-fsesE.
"a M