Omaha daily bee., 1899-10-11
NEWS OF INTEREST FROM IOWA.

not disturb the priority OF the old out
standing warrants or impair the rights or
the holders OF these warrants insomuch
that as under the statute OF 1888 the persons
to whom these warrants were Issued re-
ceived contracts which It would be uncon-
stitutonal for any subsequent law to at
tempt to abrogate Judge Smith sustained
the demurrer, thus holding the old warrants
should be paid by the city treasurer before
those issued for current expenses.
The case was taken TO the supreme court
and in November, 1885,, that body handed
down a decision reversing Judge Smith, but
failed to pass on the question of the consti-
tutionaity of the law. 1t was evident that
the supreme court in ruling on the case
had overlooked the fact that Council Bluffs
had not been organized as city of the
first class until subsequent to 1881. The
attention OF the court was called to this
seeming oversight and the decision was
withdrawn. In January of this year the
supreme court handed down It's second rul-
ing, in which 1t held that the warrants
issued for current expenses took precedence
over the old or outstanding warrants. Ac
companying the ruling was a statement in
which the court explained 1t had avoided
touching on the question OF constitutionality,
as that point had not been presented by
counsel in the case.
This decision was deemed so unsatisfactory
that City Treasurer Reed still refused to
pay out any money from the treasury either
on the new or the old warrants and a second
suit was brought. City Treasurer Reed
demurred on the same grounds as before
and Judge Smith sustained the demurrer.
again holding that the old warrants should
| have precedence. An appeal was again
taken and this time the supreme court
| reverses it's former decision and affrms
Judge Smiths ruling.
| What effect the decision of the supreme
court will have upon the issue of the $780,
| 900 refunding bonds remains to be seen.
| The holders of the outstanding warrants
can now demand payment in cash as long
as the money in the city treasury will hold
out. Many of the city officials are of the
opinion, however, that the warrant holders
will not make a raid upon the treasury, as
| the parties floating the issue Of the bonds
will be, it is said, prepared to pay the
! full face value of the warrants and interest
! to date.
The amount standing to the credit of the
! general fund at present is $54 ,66O.20 and to
the water fund, SSS,316.07 The fall turn
over from the county treasurer about No
vember 1 ought to increase the amount in
| these two funds by at least $4,000. On
October / the amount of all warrants out
standing on the general fund was $151 74S 9t
and on the water fund $S9,950. The interest
that has accumulated on these warrants
amounts to about $4,000, some of the war
rants bearing now as much as per cent
interest.
With the refunding bonds to take care
of 100000 of the outstanding warrants and
the cash in treasury, all outstanding in.
debtedness to date can be taken care Of
and the city will then be on a cash basis
and the employees of the municipality viii
be able to receive their salaries in cash in.
stead Of warrants, which they at present are
forced to discount.