The sun. [volume] (New York [N.Y.]) 1833-1916, 1900-01-23
the United States on its books the sum OF

the United States on its books the sum OF
s3,2i5,0oo on account Of the purchase,
leaving due a balance Of 100000. the presi-
dent OF the bank notifying the Secretary OF
the Treasury Of this credit, and adding the
suggestion: ave shall make the above
payment Of S3,215,000 upon the under
standing, Of course, that we are not to be
liable for any taxes or water rates upon the
property, 80 long AS you remain in posses
sion and the balance Of 100000 remains
unpaid and the deed Is undcli,ercd." To
this notice the Secretary replied on Aug.
-, 500, that THE Departments under
standing Of the matter isthe same as yours,
viz: that So long as the title remains vested
in the United States you will not he liable
for taxes or water rates.
The fact, that the s3,2l5.O 900 thus cred
tied To tho United States, was not actually
paid over to the Treasury in money, but
remained in the bank, subject to check, like
other deposits in dcpositary banks, secured
by United States bonds under See. 40 of
the National Bank act, has no bearing, 1t is
evident, III the question OF the present
ownership Of the custom house. II would
seem, that, according to the terms OF the
contract, the United States, not having
given the bank a deed OF the property, and
being still in the possession and occupancy
of it, is still the owner of it, and that it is,
consequently, not liable to taxation.
The question still, however, remains: BY
what authority was the provision inserted
in the contract for paying the bank interest
on tho purchase money, without taking
from it a lease, as the act OF Congress
directed? The act contains no such author
ity, and It mentions 4 per cent. interest on
the purchase price only as the measure of
the rental under a lease and not rs interest
for the use of the money, Nor has Con-
grcss yet made any appropriation for pay
ing either the rental or the interest,
although Secretary GAGE says that he has
asked for one in his estimates. He at first
insisted that the words Subject to appro-
priation by Congress be inserted in the
stipulation for the 100000, but at the
earnest solicitation Of the bank officers, he
consented to omit them. When the subject
comes up for consideration In Congress, OBJ
lection to the payment will undoubtedly be
made, and it ought to be made.
II would seem, therefore, that II the bank
would secure the stipulated Sl3O,6O0 a
year it must accept a deed Of the property,
give back a lease and pay the tax demanded
by the city authorities. The tax at the ex-
pccted rate Of So Is per 500, will be only
$4,000 year. so that the bank will have
n profit of $500 a year on its invest
mcnt Of s3,2l5,OOO, without counting the
interest it may make by lending out the
S3,2l5,OOO deposited with it AS public
money. The understanding betweenthe
president Of the bank and tho Secretary of
the Treasury, that the bank shall not be
liable for taxes and water rates, so long as
the property remains in the possession of
the United States, is, of course entirely
nugatory as against the city authorities.
Their right to tax the property cannot be
defeated by any agreement to which they
do not consent and are not parties.