The sun., 1900-01-11
be Gives Congress Reasons For
His Action Regarding
Public Funds.
HE DENIES DISCRIMINATION
Says the Utilization OF National
Bank as Repositories Has Been
TO Avoid Disturbance of Busi-
ness by the Withdrawal
Of Money.


by Mr.. Alien Of Nebraska and in the +,
house hy Mr Sulzcr Of Ncw York. The
text Of lis reply which is an exhaustive
exposition Of the management of that \
branch Of the treasury finances under his /,
relating to national bank
dcpostorir>, contains about 5000 words,
which i supplemented by special reports
from department officials rclativ" t. spe-
ral nqEgics iu the resolutions. including
copies Of over 1,UOD letters on NE subject
u.lor consideration ~ summing up his
reply 70 hr inquiries tl4r secretary says;
The reason FOR utilizing national
banks H. drpo.itorr, for Wliiiic moneys,
a- authorized by law when The receipts
If the treasury were exceeding IT'S eX- .
ppnditHirs has been 10 avoid he disturb /
ance to business which Tho NithdraWalbf 4
large sums u money from active cirenlu-
tiun 10 m" treasury vaults must inevita-
bly ,lu-r. 'llr policy thus pursued Us
mr ha been thr established policy of the ,
government for mang years, anil dcpar-
ttirr from It undcr similar conditions
would certainly cause disastrous resurs.
"Thr Irs"n FOR directing the internal
rrveiflr receipts into dcpository banks AT {
T.
largely exceeding disbursements from
month t. month and seem likely 10 10 So
for an indefinite time. This condition
would be- i iuonace - the business world !
If assurance were not given that this sur
plus would IL diverted from The Treasury
vaults tn ppblic repositories where.
while secure ID tho coyernment, il would
remain available 10 business usC.
FOR sake of Convenience.
The reason for directing all OF the
Internal revenue receipts to one dcpos-
itory was that il i more convenient to
first collect the receipts of numerous
Offices into one place and make the de-
sired distribution from it than 10 give
new instructions daily to 1f3 collectors.
| Tho most convenient agency TO effect
such distribution Is hank which is
| member Of the New York clearing house.
"rhe reason for selecting the National
City bank as such distributing agent was
| that at the time the order was issued it
/ was one Of hut two banks which had Of
fered bonds sufficient to cover the
amount Of tho daily deposit. Its bond
/ deposit was Sl0O0,00D and that Of the
Hanover National bank 81 .910,500. The
! National City bank was therefore the one
/ most naturally chosen or the 6S banks
applying for a share Of the deposits the
National City bank, the Hanover Nation
al banl; and three others, applicant for
over $500 900 each, ara the only ones out
OF the IS constituting group / which have
/ not been supplied the full amount for
which they had offered security.
"rhe custom house property was sold
10 the National City bank as the highest.
bidder on July 3. 1899 Under the terms
Of the sale it had the option OF paying
/ In all Of the purchase money ut any time
or any part it might elect above S150,00O,
which sum it was absolutely obliged 70
pay. 1t exercised this option by choos-
ing TO pay S3,2lj,000, leaving $4,000
vet due. No deed will be executed until
full payment has been made.
Established Custom.
The payment received was turned into
the treasury by deposit in the National
City bank, it having been the established
custom of treasury officials, under the
counsel Of their legal advisers supported
by decisions Of the supreme court, to con-
slider moneys on deposit to the credit Of
the treasurer of the United States in deg
ignated repositories MS moneys in the
treasury.
This deposit was made in depository
bank for the same reason that other de-
posits have been made III thcm-viz, be-
cause To withdraw the currency into the
vaults Of the treasury, where 1t was not
needed aud could not BE- utilized, would
have required withdrawal Of credit
that was being extended in commercial
circles. and to that extent disturbance
10 the natural order of business would
have followed. 10 have required its pay
lr- i, ~ Tn H.
other designated depository would have
been an ungracious discrimination with
ont substantially changing the fact.
FINALLY. under my administration Of
the treasury department no discrimina-
ton in favor Of one bank against another
has been made. Generally speaking, when
an increase in depository banks was de-
sired nl have hcen invited 10 qualify
themselves Tor receiving such money and
have been equally and cquitably consid.
cred IL their Respective relations T. the
treasury.
Referred to Committee.
Secretary Cages reply was referred in
the senate 10 tho finance committee and
ordered printed.
The scnotc paid eloquent tributes OF re-
spcct and affection 10 the memory Of the
late vice president. tiarret 4. Hobart.
In a beautiful and impressive invoca-
ton the blind chaplain at thu opening Of
the session referred 10 the distinguished
services of Mr. Hobart and called down
the blessing of God upon ii" bereaved
family.
Mr. Hale Me offered resolution
calling upon the state department for in
formation rs 10 what had been done re,
gardng the seizure by Great Britain ot
American products in Delagoa Bay This
resolution declared the property was dc.
! taiucd nniusty and without warrant
II tho statement that the property was
uniusly detained Mr.. Platt Comm tool
. exception, believing it ought to be mod
ihcd,
Mr. Hale said the resolution presented
a matter of vital Importance and believed
. Great Britain ought 10 be- informed oi
. the sentiment III this country. On objcc
: ton by Mr.. Lodge The resolution wen
. over.
e Mr.. Sewell a. IL then called up tn
! resolutions he had previously offered pro
il y!ding thaJ the businr5' Of the senate d
: suspended in order that the distinguish
L cd public services aud private characte
r 6f Mr. Hobart might r. fttlnGly com
> ,ncmorated.
!. Mr.. Seweil addressed be senate in
3beautiful tribute to the had Statesman
7ribute was also paid Mr. iohart's men
By Mr. Lodge and Mrp Depew. /.
fN