The Billings gazette. [volume] (Billings, Mont.) 1896-1919, 1900-01-12
Secretary It the Treasury Replies
to the Resolutions Of Con-
gress
Asking For Information in Re-
gard to Deposits in National
Banks.
Done to Avoid Business Disturb.
ances by the Piling Up Of
Money.

MOllCys
WASHINGTON, Jan. 11.-Secretar
Gage has sent to congress his reptile
to resolutions recently introduced il
tho senate by MI. Allen Of Nebraska
and in the house by MI. Sulzer Of New
York. The text of his reply, which /
u exhaustive exposition of the mar
agement of that branch of the ~treasur,
finances under his administration, rs
lating to national bank repositories
contains about 1900 words, which j
supplemented by special reports from
department officials relative to specia
inquiries in the resolutions, including
copies of over 1000 letters on the sub
iect under consideration. In summing
up his reply to the inquiries the secre
tary 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 expenditures, has been to avoid
disturbance to business which the with.
drawal Of large sums Of money from
active circulation to the treasury vaults
must inevitably cause. The policy thus
pursued by me has been the established
policy Of the government for many
years and a departure from it under
similar conditions would certainly
cause disastrous results.
Second-The reason for directing the
internal evenue receipts into deposi-
tory banks at this time il that the rev.
enues are now largely exceeding dis
bursements from month to month, and
seem likely to do SO for an indefinite
time. This condition will be a menace
to the business world if assurance were
not given that this surplus would be
diverted from the treasury vaults to
public repositories where, while &C.
cure to the government, it would re.
main available to business use.
Third-The reason for directing all
Of the internal revenue receipts to one
depository was that it Is more conven-
lent to first collect the receipts of the
numerous Offices into one place, and t.
make the desired distribution from it,
than to give new instructions daily to
113 collectors. The most convenient
agency 10 effect such distribution is a
bank which is a member Of anew York
clearing house.
Fourth-The reason tor selecting the
National City bank as such distributing
agent was that at the time the order
was issued, it was Of but two banks
which had offered bonds sufficient to
cover the amount of the daily deposit.
Its bond deposit was -, 600, 900 and
that of the Hanover National bank
81, 1850, 900. The National City bank
was, therefore, the one most naturally
chosen. OF the ~ banks applying for a
share Of the deposits, the National
City bank, the Hanover National and
three other applicants for over $500, 900
each, are the only one out of the 81
constituting group one, which have not
been supplied the full amount for
which they had offered security.
Fifth-The custom house property
was sold to the National City bank az
the highest bidder on July 3, 1899.
Under the terms of the sale it had the
of paying in cash all of the pur.
chase money at any time, OF any part
might elect above $3.50, QUO, which
sum it was absolutely obliged to pay.
It exercised this option by choosing to
pay $3,2l5, 600, leaving $50, 900 yet due.
No deed will be executed until full
payment has been made. The payne
received was turned into the treasur,
by deposit in the National City bank, it
been the established custom
the treasury officials, under
the counsel of their legal ad.
supported by decisions of the
supreme court, to consider moneys or
deposit to the credit of the treasurer of
the United States, in designated depos.
tories, Is moneys in the treasury. This
deposit was made in a depository bank
FOR the same reason that other deposits
have been made in them: Because to
withdraw the currency into the vaults
Of the treasury, where it was not
needed and could not be utilized, would
nave required a withdrawal of credit
hat was being extended in commercial
circles. and to that extent, a disturb
of the natural order of business
would have followed. TO have required
to payment by the National City bank
% another designated depository, would
ave been an ungracious discrimination
substantially changing the
Finally, under my administration of
he treasury department, no discrimin-
in favor Of one bank against
mother has been made. Generally
Ipeaking, when an increase in deposit
DRY banks was desired, all have been
to qualify themselves for re.
such money, and have been
and equitably considered in
heir respective relations to the treas.
Try"
rRIRTITE TO HORARY.