The Red Cloud chief., 1902-11-28
CAN BUY BONDS
Court Approves Purchase CT
Massachusetts, Securities
DECISION Is VERY SHORT
Will Create Revolution In Methods
Board of Educational Lands and
Funds Welcomes the Decision
WI Invest In Securities

With the sanction Of the supreme
court the Nebraska board Of education
al lands and funds will revolutionize
Investment methods by buying $500. 900
state OF massachusetts, bonds. De-
partment No. | of the court. ompris
ing Commissioners Hastings. Kirkpat-
rick and Lobingier, Wednesday last
gave a decision granting a writ of
mandamus requiring State Treasurer
Steuier to pay out not to exceed $780,
600 for Massachusetts bonds In accord
ance with an order OF the board.
The remarkable thing about this
transaction Is that Nebraska will be
the only far western state to hold Sc
curities OF n of the old and rich
states of the far east. The board does
not disguise the fact that they do not
care to buy the bonds of any and every
state In the union. An opportunity re-
Gently onered for the purchased ( Ten
nessee bonds but 1t wis permitted to
pass unnoticed. If the board uses good
judgment in the future il Is believed
the cecision OF the court will result in
nothing btu good for Nebraska.
Inc decision came as the result Of n
test case filed by the board, comprising
Land commissioner Follmer. Secretary
Prout and State Treasurer Steufer. The
board at a meeting held November II
agreed to buy the bonds which were Of
Tered by a firm of brokers of Topeka.
Kelly Il Kelly. Attorney General Prout
a V the board an opinion in which he
said the right of the board to buy the
bonds OF any other state could not be
successfully denied under the constitu-
ton. In order to secure a decision Of
the court Treasurer Steufer declined
to pay out the money for such a pur-
pose and a mandamus suit was filed by
the attorney general.
The petition of the attorney general
states that on November IL the board
accepted the following proposition SUBJ
mttted by Kelly & Kelly. I'VE here
with offer you 5000, 900 state of Massa-
chusetts bonds bearing 3h per cent
interest to net you 3 per cent. IL there
should not be sufficient funds on hand
to take up all at once we will carry
them at a bank In Lincoln where they
can be delivered and taken up as the
funds come In. All bonds offered will
run from thirty to forty years without
option. making a very desirable invest
ment."
The decision Of the court Is very
brief. In substance II holds that the
wording OF the constitution regarding
investments in United States bonds
and state securities and registered
county bonds Of this state means that
not only United States bonds may be
purchased, but that the securities of
any state may be bought.
As a result the uninvested educa-
tional funds Of Nebraska will be in
vested Immediately. The sources of in
vestment are growing scarcer all the
time and are so limited by the consti-
tuition that money Is constantly ac-
cumulating. The decision Of the court
will give much relief but 1t may be
only temporary. About 5000, 900 Of edu-
cational funds are now on hand and by
the first of the year there will be
enough more to take up the $500, 900
bonds offered. The state already holds
many county bonds but these are be-
Ing paid of rapidly with money which
Is accommodating in county treasures.
Maturing land contracts are also bring
Ing In a great deal OF money. Treas
urer Stuefer already feels for his sue
cessor who Is to be the custodian of
this increasing fund. He believes the
board will be called upon to invest
$l2, O00. 900 during the next five years.
All attempts have failed to amend the
constitution so as to permit invest
ment In school district bonds. NUM-
cipal securities will also be favored by
some when the time comes to amend
the constitution.