The Montgomery advertiser., 1905-02-02
GOVERNOR CUNNINGHAM PLANS
 TO FUND THE STATES DEBT

 and see the advantage as well as the patriotism of the States funding it's own debt.
 Bids will be received until l2 m, April 4, 1905. and will be opened the next day. They will be acted upon, and\accepted or rejected, not later than April Is. 1905. I think an examination of the plan will show that 1t afford. an easy method of refundlng the State debt"
 history of old Bonds. The history of the bonds which are to be renewed is interesting in the year just before their maturity. The bonds maturing July 1 are of two classes, A and B. The Glass A bonds amount to s6.S5s, GOO, and for the first five years after they were Issued bore interest at the rate of per cent. For the next five years they bore per cent. inter- est; the next ten years. { per cent, and since 1896 5 per cent.
 The Class B bonds. amounting to $57s. 900. ever since the act of the Leg isIature authorizing their issuance. was approved, February 2s, 1876, have borne per cent. interest straight. They are of the uniform denomination of $1,00o while the Class A bonds are of the de- nominations of S1.Aon. $500 and sf0a
 1nS CIaSb V DOluS, fDcdIihB uhSC VI January 1. 1876, have brought interest at the rate of per cent and mature January 1, 1906.
 All these bonds are the outgrowth of the great adjustment plan following upon the heels of the Constitution of 1875. Then the people of Alabama found themselves face to face with a. very discouraging state of affairs in regard to the public debt. They found that the total amount of the estimated liabilities was $3O.OoO.oo0 and set over against this was a property valuation of only $130, 0,000.o0O.
 The Constitutions makers. however. put their shoulders to the wheel brave ly and one of the first things done at the convention of 1875, which met in Montgomery, was to put a clause In the Constitution prohibiting further debt-making. The States affairs were put on an economical basis.
 Soon after this convention the State appointed Commissioners to negotiate with the bondholders and propose Q settlement. A settlement was effected and an act of the Legislature followed on February 2s, 1878. which authorized an issue and exchange of the States securities. It was in this transaction that the bonds (classes A. B and O were issued, specified to run for thirty years.
 The class B and c bonds, in review Of their individual history. reviews the repugnant memories of the legislative ptofligacy and extravagance which marked the troublous period right af- ter the close of the war between the States The bonds were issued In sub stitution for bonds that had been is- sued in 1872 for State endorsement Of railroads. The class c batch were in exchange for endorsed bonds of the Alabama and Chattanooga Railroad which defaulted in the. Interest on their bonds in January i, 1871.
 The railroad policy of Alabama which began in 1887 was the most reckless that has marked the State government
 On December. 1865. there was issued by the Legislature $1,5OO,000 of gem eral appropriation bonds. Only four teen months later the Legislature passed an act granting aid to all rail- roads which might be built in the State. The aid was in the form of in- dorsing the bonds of the new railroad companies to the extent of s12.O00 per mile for each section of twenty miles constructed.
 So anxious were the law makers some time later to hasten the indus trial progress of the State that in Au- gust, 1868. thes first act was amended so that after the first twenty miles were completed the endorsement should be extended for each i've miles fin- ished, and in September the indorse- ment was increased to $16,000 per mile.
 It was in 1870 that the Alabama and Chattanooga Railroad defaulted- on its interest. The State, of course, as guarantor. was called upon to- make the contract good. No preparation had been made for such an event and a session of the Legislature was nec- essary. The Legislature set to work to recover itself and restore it's credit An act was accordingly passed offer ing to substitute State bonds at the rate of one for every four of the en- dorsed bonds of the railroad presented.
 This arrangement was only effective, however, in small part, as the State defaulted on all its interest in Janu- ary, 1874. In 1876 came the last ad- justment of the entire debt of the State, the authorized debt being fixed at s9.6S6,000. This. of course, includ- ed S1.o0O.OO0 outstanding State certih- cates bearing 8 per cent interest, known as State notes" Under this adjustment interest has been paid reg ularly by the State and the contract has been met satisfactorily to all par ties.
 Previous to the abandon of the Leg ! islature in pursuing Its prodigal inter- nal improvements policy. the only out standing obligation of Alabama was a residue of bonds amounting to S3,1 445.OO0. This was the debt just before the war broke out It was created by the failure of the State Bank and branches in 1S44.
 These valuable facts are related in a publication of the State Department of Archives and History.
 The bonds which the Governor will renew are producing for the current year an aggregate interest of $41O,52O.
 HAS NO POLITICAL AGENTS.