The record-union. [volume] (Sacramento, Calif.) 1891-1903, 1898-02-27
WHAT THE CITY OWES.
STATEMENT OF CITY TREAS.
URER FROST TO TRUSTEES.
It Raises Some New Questions Re-
garding the Bonds That Must
Be Considered.

The following letter of City Treasurer
Frost to the Board of City Trustees IS
self-explanatory and raises some new
questions for their consideration.
Sacramento Feb. 26, 1888.
To the Honorable Mayor and Board
of Trustees of the City of Sacramento
Gentlemen: The Act approved April a,
1858. authorized the issuing of $l,6OO.- :
600 of 6 per cent. bonds, and herewith
a definite number of coupons, and di-
rected that, whenever in any year there
shall remain in the interest and sinking
fund a surplus of 81 900, or more. after
paying the interest in accordance with
the Act, it shall be the duty of the
Treasurer to advertise for twenty days
In one of the daily papers published
in this city, stating the amount to be
disposed of, and that he will receive
sealed proposals for the surrender or
such bonds; also, that the lowest bids
shall be accepted at rates not exceed
ing par value, as may redeem the great
est amount of bonds, until the amount
of cash on hand for redemption is ex-
hausted.
On the Sd day of February, 1898, the
City Treasurer and the City Auditor
found that $34 900 remained in the in
1erest and sinking fund after paying
all interest. Your City Treasurer did
thereupon advertise for twenty days in
the Record Union" as per copy hereto
annexed.
No proposals have been received; in
fact. no bonds have been offered for
redemption in any manner during the
present year. There is money in the
treasury to pay all matured coupons
as presented.
Permit me to call your attention to
the following points which have never
been decided:
Frst-Can these bonds be redeemed,
or paid, by the City Treasurer in any
other manner than by advertising for
proposals?
Second-Does the recent advertise
ment stop interest on any bonds?
Third-Have any bonds become out
lawed and have any bondholders be-
gun suit on some bonds to prevent out
lawry?
At the date of issuing said advertise
ment the Act of April "a, 1853, was con-
Strued by good authorities to mean that
the city was exempt from the obligation
to pay interest on it's overdue coupons
and bonds The decision of February
IA, 1898, in Kendall VS.. Porter does
not reverse the previous constituting OF
the Act, but instructs the lower court
to first hear the answer, or return, OF
the City Treasurer thereto.
Permit me to suggest that the recent
advertisement raises the new questions
referred to, and that preparation
should be made for answering the re-
mittitur in the lower court. Respect
fully, A. l.. FROST,
City Treasurer.
The letter of the City Treasurer justi-
fies the following reorganization Of the
city's finances:
The entire indebtedness of the city,
excluding that held by the Fund
ed Debt Commissioners, amounts
OF this total there is due in 19O3.... $4,000
Add back interest under decision
of February IL, 1898. ................ $50, 900
Total immediate liability . s6l7 900
The cash available now Qncludng
county DondS) Is. .S5UO-O ov
Add revenues of 1898. ................ 10, 900
Total -S4Zu,VpV
For the remaining 100000 there can
be issued 4 per cent. bonds, and the
Commissioners can then destroy all the
bonds they hold. In this manner the
city. by January, 1899 can become
free of all debt except the $4,000 due
in 1903, and the new 100000 issue.
A Record Union reporter inter-
viewed Frank Miller. who said he had
no opinion to express, except that the
idle money in the treasury should be
invested in bonds of some kind