The Houston daily post. [volume] (Houston, Tex.) 1886-1903, 1899-07-14
TEXAS AND THE BOND BUYERS
fRy L. A. PETTY

1
cash balance, now amounting to nearly
80 900 600 to the credit of the permanent
sch.ol fund In the State treasury. has be-
! come the source OF no little concern to TINS
MANNERS OF the State government chargea
,,.b ,s care and clothed with the neces-
sary authority to dispose oil 1t In sucn
manner as to cause il to produce revenue
for tho benefit of the available school
fund. Up 10 the beginning OF the Cuiper-
SON administration the State board OF eau
ootion encountered but little competition
In the purchase OF county bonds and found
it comparatively easy matter TO get
securities bearing comfortable rate OF
interest in which to invest such moneys as
it might have on hand belonging to the
permanent fund. About five years ago,
however, Eastern investors began to wake
up to the fact that, in spite of the mouth
ings of a certain school Of nest befouling
Texas politicians, the bond laws Of 1888 are
anything but inlmical to capital and at
once set about to take advantage OF the
opportunities afforded them hereunder 10
plant their wealth to advantage Ia THIS
State From that time on the board OF
education has had to hustle TO keep from
being pushed out of the bond market alto
gether. Bond buyers have overrun me
State in growing numbers and systematic
ally drummed commissioners courts in an
effort 10 get hold of every bond they
might issue, and in some instances induced
them to enter into obligations of when
existing conditions did not warrant the
w "a
sible bonds held by the school fund have
been refunded at a lower rate of interest
than they originally bore and sold to-
agents of Eastern firms who fished for
them with hooks baited with q nominal
and delusiye premium, and various ana
sundry other schemes have been resorted
to by which the board OF education has
been crcumvented. For instance, when
ever it came about that a county found
1t necessary to issue bonds eight or ten
agents of Eastern bond buying concerns
would turn up and enter into what to out
ward appearance was most spirited con-
test for the acquisition thereof.
~ \
In reality there was no competition be-
tween them. They would get together on
the quiet and beforehand agree on tho
limit of premium to be offered as we'll
as upon the party who was to bid said
limit and get the bonds and subsequent
ly divide commissions.
Year after year the success which at
tended the efforts of these people in their
particular line became greater until 1t at
tracted the attention of the legislature
and during the sessions of 1895 and 1897
a Ntata a,.1
of education such latitude as it needed
to hold its own with them. They We're
on hand each time, however, and succeed
ed in preventing the enactment OF any
law that might interfere with their
graft"
Finally their exploits became so no.
torious that Governor Culberson in the
last year of his administration found it
TO take radical steps towards
with the refunding of many
bonds held by the school fund and felt
JAILED upon to issue circular letter to
he commissioners courts of the different
calling their attention 10 the eff
ect of selling bonds to spectators in
stead of letting the school fund have
hem. Subsequently this matter became
issue. Recognizing the import
,nce thereof Governor Sayers paid it
considerable attention on the stump prior
o the election of 1898, and his first mess
ge contained pointed reference thereto
With suggestions for a remedy. Needing
hese suggestions the Twenty sixth legis-
ature passed an act authorizing the State
BOARD of education to purchase municipal
Is well as county bonds. Further than
his the board was given a ten-day option
IN all city and county bond issues and
urned loose on the market, or in other
words, granted leave TO exercise It's dis
retion in the matter of paving premiums
n addition to all this the old statutory
Prohibition against the purchase of bonds
,earing less than per cent interest was
wiped ont.
Fortified in the above manner the board
( education ought from now on be able
o cope with the bond spectators who
ave heretofore been making things so
~ ,
But It will be some months yet before :
he latter can be downed. Anticipating /
he passage of just such an act as the one !
utlined above they got a move on them :
elves and in various ways stimulated c
he issuance of county and municipal
onds this spring to that extent that more
+ this class of securities has already been !
uSphNSN W Auc dllol neg BehsEdl 10 uble i
n approval for 1899 than was presented n
uring the entire year 1898. So great has !,
ne rush become, in fact, that the attorney 4
enersl's department has. after consulta- Il
on with the governor, decided to be in |.
o haste hereafter in passing upon the a
onds which are being showered upon IT, c,
5 1t has developed that they have net only G
cen contracted for by SPECTATORS. but p
nat said spectators have in view a raid h
pom the permanent school fund. expecting 10
turn neat penny by transferring there al
} bonds which they have gobblel since CT
lie first OF the year. This was made an Il
aren't recently by the receipt by the board is
education of proposition from a Cleye- al
md, Ohio, firm Of bond dealers 10 turn
YER to the school fund about 100000 OF XII
and per cent bonds issued by North In
eSas county. The transfer was to be b,
ade upon basis that would leave said n,
ma about per cent per annum on the ne
vcsiment. The offer was rejected and XII
lie beard decided not to buy any bonds ha
ON spectators, and at this writing II il OF
andlAg pat on Its decision, notwlthstand- ha
g the publication a few days ago of re- ch
irls 70 the contrary started by and m
lhted IN the interest OF the spectators tn
Ia thelr agents. Instead OF backing MI
lwn II Is more than likely that the hoard oh