The Hawaiian gazette., 1905-09-15
LIMITS
The LOAN


row only $4,000 of the sl.S77.oo0 loan
authorized by the last Legislature. His
determination was expressed in a let
ter to Territorial Treasurer Campbell.
Executive Chamber.
Honolulu, Hawaii, Sept. 10, 1905.
A. j. Campbell, Esq, Treasurer, Terri
tory OF Hawaii
Dear Sir: After consultations with
you and number Of other gentlemen.
propose to lay down the following
policy In relation to the proposed new
loan, as passed by the last Legislature,
which carries appropriations for ST.
377, 10000.
AS you are aware, our Indebtedness
has increased from the sum of $780,
900. 90 at the time of annexation, until
It is today 50, 10000. Prior to an.
nexation. this community carried a
loan as high as $4,000, 10000. While
that was at higher rate of interest
yet a large proportion of our revenues
came from customs receipts-indirect
taxation-whereas now our only rev.
enue is from direct taxes.
In the early SOS, under the leader
ship of Hon. s. G.. Wilder, this COM
ness and had cash balance on hand.
From that time on each succeeding
form of government and Legislature
has added to the debt so that our peo-
pie have practically never felt the
pinch of not only paying for the main
tenance of the Government, but also
contributing towards the return of the
principal previously borrowed.
| Gil
nexation we have paid off the paltry
sum of 1929, 100000 of our bonded in
debtedness out of the proceeds of land
sales. No Legislature has as yet seen
fit to establish a sinking fund to meet
our Indebtedness. and the last Legis-
lature refused to pass an Act making
the proceeds of our land sales and the
revenue from land applicable to our
debt and it's interest. 1t ought to be
clear to any thinking man that the
rapidity with which we are accumu-
Ilating a debt should be checked, If pos
sible. The question arises, is 1t not
obligatory upon the Administration TO
carry out the mandates of the people
expressed through the Legislature?
A casual examination of this ques-
ton will show that the authority to
issue bonds was established by Act AZ
of the Session of 1903, up to $5,000000,
as from time to time provided for by
the Legislature. A glance at Act Of
the Extra Session of 1905 will show
that the language used in the bill can
mot in any sense be considered manda-
tory.
You will remember that at the time
of signing the bill, I sent message
to the Legislature then in session,
stating that the lateness with which
had received the bill prevented a thor
ough examination, and that had sign
ed 1t, reserving for later time an ex-
animation in detail of the items.
One of the causes which led up tt
the large appropriations is the desire
OF the Representatives from each is
land to secure as large an appropria-
tion as possible for their constituents
land that fear has in some cases blind
ed their judgment as to the necessity
for the appropriation or the need OF
borrowing money to carry out the
work. l believe 1t would be much
wiser policy for the Legislature to al
low the various counties in given cases
which it has passed upon and approved
to issue their own bonds, for then the
espcnsibility of payment being entire
ly upon their own shoulders, more eau
tious action and better judgment would
be exercised in determining the method
= of expenditure.
; / think you will agree with me that
: in the case before us we should not
: necessarily lay down the theory that
no Territorial loan money should be
e>pcr ded upon road work of any kind
but rather that under the present bill
II we deviate from those general APP
preparations which the Legislature has
admitted We're Territorial in every
sense, and make any selections from
those amounts which We're apportion
ed to each island, we must then, II
folrness. undertake proportionatt
amount of work in each of the Other
islands.
Therefore. instead of passing on the
advisability and necessity of those ap'
rrcpria tions, it seems wiser to limit
to $4,000 and to carry out the amount
only of those appropriations that the
LEGISLATURE itself considered to be f)l
the Lepeiit of the whole Territory.
You may, therefore, proceed to Sc
cure the necessary data for the Pres
idents approval, and make the neces-
cary arrangements to issue $3.50, 900 OF
bonds. And l would suggest that the
Territory undertake to place this issue
at 9S or better and at 1-2 per cen in
terest only, thus reducing the interest
1-2 per cent lower than that of any
bond which has ever been issued here
If We fail to get better than 9S and
, these bonds are called in with a short
period then it might be preferable &c
issue per cents at premium. But
to my mind every advantage tends to-
wards the 3 1-2 per cent bonds.
1 am already aware of your full con-
currence in this policy, and shall leave