The Houston daily post. [volume] (Houston, Tex.) 1886-1903, 1898-12-18

| riod .... .............. $5,9,162 IS
| Transfer under act April l.,
| 1892, TO available school fund 16S,096 46
Total 49,. ......r..... s6S7.s59 II
| Leaving balance cash on band
| August 81 1898 ............ 1857, 1o1 IL
Bonds ON hand August 81, 1s97.s7, AS, o22 u
Bonds purchased during year. 442, 100 90
--------
| 1Otll ......... ...St,o'V,ois -
Bonds redeemed during year. s92S,2Sl 20
Leaving balance bonds on
hand August 81, 1898 ....$6, 962 b31 "a
| invite your especial attention 10 the
| embarrassment that the board 81 cduca-
ton is confronted with In the investment
of the permanent school fund, which fund
is increasing tsnd can not be invested in
such security as Is now provided for by
law.
Table No. 80 shows the bonds OF the
several counties in which the school fund
has been invested.
On September !. 1897, che school fund
held $3.50 sos n of county bonds. During
the fiscal year counties have redeemed
bonds held by the school fund amounting
10 SITS Sps3 The board of education has
purchased county bonds durllng the same
peuiod S4S2, co. which shows total in
vestment OF this fund in county bonds, on
August 81. 1898. S3,ls6,lli.5i, decrease
III lIllS investment at utIt alosp vi tuN i'SNN'
year of $3ii ,49l.23,
The records of this office show 81, 63I 6O2
county bonds registered during the past
fiscal year while the board OF education
has only invested the school fund In $685.
| $50 in uhis class Of securities. which shows
that 81, 3o3.Sl2 has been purchased with prl-
waite capital Under the present law the
| board of education IS restricted TO the
purchase of county bonds at par that bear
| not less than per cent interest. Therefore
| the board could not compete with private
capital in bidding on county bonds.
This 81, 200, coo OF county bonds Issued
| during the past year has gone TO private
| captal mainly because Of the premium
| paid county Officials who are charged
| with these matters naturally desiring to
| make the very best sale possible.
Without undertaking to discuss the Wis
dom of the policy that has been pursued In
| this respect by various county OFFICIALS, We
are confronted with the fact that tho In
| ducement OF premiums offered has placed
| the bonds beyond the reach of the board
! OF education and the cash in tho state
| treasury on December |, 1928, TO the
credit of the permanent school fund mas
reached the sum OF $llS4, 247.l2.
| 1t is platn--the proposition needs no ar
g,lment--that legislation is required in or
| der that This fund which Will doubtless
| continue to increase, may be invested.
| This regard as one OF the most important
subjects that the Legislature will nave 10
deal with. l have thought much along TINS
line, and altar mature consideration SUE :
gest first that the present law should ne
| so amended rs to lodge some discretion
| with the board OF education, In order that
thrv may be placed in a position where
| tho State can through that board, COM
pete with private capital in the anveStmeht
of this fund in interest bearing securities
Second If 1t should be deemed wise 10 open
al m
opinion that the authority for investment
might extend to other State bands OF the
limited States and city bonds of this State
throwing such safeguards around uh,s
fund. through the law, If passed. Whlcr
would make the school fund absolutely
| secure. r,c
PREVIOUS INVESTMENTS.
In view of the contemplated Legislation
on this subject il may be well that
should review the previous investments o
the school FUND in railroad bonds. From
1857 to 1862 the school fund was investeS
in railroad bonds as follows:
Houston ana Texas Central
. railway, original loans...... S4bo,0o0 VI
4 Past interest due May !. 1870,
charged as principal. ....... 225,324 d
Washington County railway,
\ original loans. y. ........... $4,000 "
Past interes, due May l, 1870.
charged az principal ........ 3s,l6o v
Galveston, Harrisburg and San
loans ............ 42O,OOO o
d Past interes, due May i, 1870
: charged as principal. 80. 242. $50 .
Texas and New Orleans rail-
way original loans ........ 430,5OO 0
y Past interest due May !, 1870,
3 charged. as principal ....... 22o,63i 2
Texas and Pacific railway.
: original loans ,........,..... 10000 o
n Past interest due May /, 1870.
y charged as principal ......., 72.i25 0
Houston Tap and Brazoria
4 railway, original loans. 100000 o
N Past interest due May /. 1870,
=, charged as principal ........ 1880 0
"a Total original loans. .......sl 900
!, Total interest charged as prin-
10 cipal -. -. -. ............ 979069 s
n Grand total -. .......,... 81. 795, 069 s
I. These railroads have made the follow
=, ing payments OF sinking fund In lawfu
II money:
u Houston and Texas Central
m railway. ........ S2b3,SoS
i Washington Couuty railway. 1884 /
m Galveston, Harrisburg and San
j. Antonio railway $50. ...... 269.995 8
le Texas and New Orleans rail-
a way ............. ....... 2SS,954 Q
Ne Texas and Pacific railway. 222.l25
"a Houston Tap and Brazoria
J. railway l34,2OV
ICtal .,...el,lc-,iui
r. The Texas and Pacific railway has take
N up its bonds. making the last payment o
N March !. 1898. The Texas and New orlear
Is is still indebted to the school fund In tn
a sum OF $367,l7 This road meets il
l. payment OF interest and sinking fun
10 promptly ON May and November OF eac
I'd year
s. The Houston Tap and Brazorla Railwa
ID company was sold by Il. j. Davis. viii
OF governor for $4,000 for default In ii
1t payment OF the interest and sinking fun
l. due, and said amount was deposited
Of the State treasury Thus the debt OF tn
Ia company was liquidated.
Sc In 1898 and 1894 the Houston and Texl
r Central Railway company and the Calves
Of ton, Harrisburg and San Antonio Railwa
10 company refused to pay further upon the'
i debts. which included the loan to Ii
o. Washington county Railway company an
= the Buffalo Bayou, Brazos and Colorad