The Eureka sentinel. [volume] (Eureka, Nev.) 1902-current, 1903-07-04

of she Bonds Exchanged-state
school FUND sacred Trust-Mar
The State Board of Education, having
completed the sale Of United States bonds
which fell due il 1907, makes full state
ment of the facts and reasons which gov
erned them in the transaction for the in
formation Of the people as follows:
HISTORY.
About two years since, Governor Sadler
advocated the sale OF the United States
bonds due 1907, then in the Treasury,
and the purchase OF United States Gov
ernment bonds maturing in 1925. He
showed, and we think clearly, that the
State OF Nevada would benefit very much
by the exchange. The State Board, not
being acquainted with the details Of the
financial operations, hesitated until too
late about accepting the recommendation
OF Governor Sadler.
During the past Winter the attention
OF the State Board of Education was call
ed to the necessity Of making an invest
ment Of the public school funds at once
or losing the benefits by depreciation oi
the bonds and lower rate of interest
that would follow. The members OF the
Committees on Education of the Senate
and the House were called into the Gov
OF 30 anpfar ahnnf tha matter
No definite action was taken by the
members OF the House; but they agreed
that il the Massachusetts, bonds, were
found 10 be valid bonds, the exchange oi
the United States bonds for the Massa-
chusetts bonds seemed to be good and
advantageous exchange for the benefit
OF the Public School Fund OF the State.
Two members Of the Board, keeping IN
mind the recommendlti OF Governor
Sadler two years ago, were in favor oi
making the exchange OF bonds according
to the offer OF Messrs. Kelly Kelly, oil
Topeka, Kansas; but the Governor was
with the amount OF knowledge that he
then had. Correspondence was entered
into with the Treasurer OF the Massa'
chusetts, the Chemical National Bank OF
New York, the First National Bank oi
Chicago and two or three other banks
respecting the value OF these bonds. Let
ters from these various banks gave in
dubitable evidence that the bonds were
4. valua hla NJ
vestment. During this inquiry the fact
was brought out that the Massachusetts,
State bonds had been accepted by the
United States Government as deposits IN
the Treasury in place OF United States
bonds. thus showing the esteem in which
the United States Government held these
bonds. Although this evidence seemed
to place the transaction beyond question,
the Governor requested a member oil the
Board to go TO Chicago. Washington and
Boston and inquire as to the value oil the
Massachusetts bonds before he was will
ing to take any steps toward their pur-
chase. The member of the Board left
Immediately and advised with the otii-
GERS OF the First National Bank oi Chr
cago, with the Assistant Treasurer at
Washington, and with the Treasurer oi
Massachusetts at Boston. The value oil
the Massachusetts bonds was established
beyond question and the fact telegraphed
to Governor Sparks.
THE LAW.
The powers OF the Board OF Education
have been called in question. The stat
ute which applies to the investment OF
funds is found in Section 1887 OF Gut
ting's Revised Statutes. 1t is provided
first. that in no case shall any bonds be
purchased without the State Board oil
Education making due and diligent in
quiry as to the financial standing and
responsibility of the State or States
whose bonds it is proposed to purchase
1t is very clear that the State Board ol
Education complied with the provisions
of the statute and made the fullest in
quiry into the financial standing OF the
State, satisfying itself that the bonds
were safe and valuable investment.
2. The statute says that the Board o.
Education shall require of the Attorney
General Of this State his legal oplniot
as to the validity OF any Act or Acts o
any State in which State bonds are issued
In accordance Herewith, the Board o
Education consulted the Attorney-Gen
eral at every step and obtained his lega
opinion that the Acts on which these
bonds were issued we're valid.