Deseret evening news. [volume] (Great Salt Lake City [Utah]) 1867-1920, 1900-01-10
Tells Why He Deposited Funds
in the National City Bank
POLICY FOR MANY YEARS.
Would Not Change It - sums Up a
Long Message in a Few Para
graphs for Congressman.

Washington, Jan. lO.--seeretary Gage
today sent to Congress his replies to
resolutions recently introduced In the
Senate by Mr.. Allen and ia the House
by Mr.. sulzer Of New York. The text
OF his reply, which 10 an exhaustive
exposition Of the management Of that
branch Of the treasury finances under
his administration relating to national
bank repositories, contains about 5000
words, and is supplemented by special
reports from department officials rela-
tive to special Inquiries IN the reSolu-
tons, including copies Of over 1000 let
tiers on the subject under consideration.
In summing up his reply to the In
quirles, the secretary says:
"First--That the reason for utilizing
national banks as repositories for pub
lie moneys, as authorized by law when
the receipts Of the treasury were ex-
ceeding its expenditures, has been to
avoid the disturbance to business, which
the withdrawal Of large sums Of money
from active circulation to the treasury
vaults must inevitably cause The poll
cy thus pursued by me has been the
established policy Of the government
for many years, and departure from
1t under similar conditions would GER
talnly cause disastrous results.
"Second-The reason for directing the
internal revenue receipts into depository
banks at this time is that the revenues
are now largely exceeding disburse-
ments from month to month, and seem
likely TO do 80 for an indefinite time.
This condition would be menace to
the business world II assurance were
not given that this surplus would be
diverted from the treasury vaults TO
public deposltories where, while secure
TO the government, II would remain
available TO the business world.
"Third-The reason for directing all
the internal revenue receipts to one de-
pository was that II was more con-
venient TO collect the receipts Of one
Office in one place and the desired dis
tribution from II than To give instruc-
tons. daily to ll3 collectors The most
convenient agency to effect such dis
q
Der of the New York Clearing House.
"Fourth-The' reason for selecting
the National City bank as such distrib-
uting agent was that az the time the
order was issued IL was one OF but two
banks which had offered bonds sufficient
to cover the amount OF the daily de-
posit. Its bond deposit was $4,000 900,
and that of the Hanover National bank
e1 ON The Nattnt,al ritxr hank
was therefore the most naturally
chosen. OF the sixty-eight banks APP
plying for a share Of the deposits, the
National City bank. the Hanover Ma
tional bank and three Others, applicants
for over $4,000 each are the only ones
out OF the sixty-eight constituting
group one, which have not been sup
piled the full amount for which they
had offered security.
"Fifth-The custom house property
was sold to the National City bank as
the highest bidder on July 3, 1899. I'm
der the terms Of the sale 1t had the
option Of paying in cash all OF the par
chase money al any time, or any part
II might elect above $4,000. which
sum it was absolutely obliged TO pay.
1T exercised this option by choosing
TO pay s3,2l5, 600, leaving $4,000 yet due,
No deed will be executed until full pay
ment has been made.
THE payment received was turned
into the treasury by deposit In the Ma
tional City bank, II having been an es-
tablished custom Of treasury officials, un-
der the counsel Of their legal advisers,
supported by decisions OF the Supreme
court, to consider moneys on deposit TO
the credit Of the treasury Of the United
States in designated repositories as
moneys In the treasury. This deposit
was made In a depository bank for the
same reason that other deposits have
been made in them. viz: Because TO
withdraw the currency into the vaults
Of the treasury where II was not needed
and could not be utilized, would have
required withdrawal OF credit that
was being expended In commercial cir
Giles and TO that end disturbance 10
the natural order Of business would
have followed.
ITO have required It's payment by
the National City, a bank, TO another
designated depository would have been
an ungracious Discrimination without
substantially changing the fact.
Finally, under my administration OF
the treasury department, no discrlm-
nation In favor OF one bank against
another has been made. Generally
speaking when an increase In deposit
tory banks was desired. all have In
vited TO qualify themselves. for receiv-
ing such money, and having been
equally and equltably considered In
their respective relations to the treas