The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1907-07-14
STATE IS HAWKING
ITS CREDIT AGAIN
Has Already Borrowed $685.
600 in 1907 to Pay Its Run
ming Expenses.
PAYS INTEREST ON 1T:
CITY Is PAYING NONE
Sideli ghts on Mormon Methods
Of Financiering in Utah's
Government.

The State Of Utah has already bor-
rowed Sl25,o00 In 1907 to paw the cur
rent expenses Of running the various
departments of the State government.
and is paying 4 per cent interest there
on. Other loans viii be necessary be-
fore taxes begin to come in in Novem-
Der. Last wear the State borrowed
S39O,O00 for current running expenses
and paid out the sum Of S617S in in
tercst
The government ot Salt Lake City,
which is Just now being attacked by
the local Mormon press and being held
up to the world as a BANKRUPT, is doing
the same thing tho State is doing =
namely, anticipating fall tax collections
The difference is that the city is carry
ing an overdraft at the bank upon
which 1T is not paying Il fvc-ccpt piece
In interest, while the State govern
mcnt, which is under the control Of
Mormon elders is going into the money
market and borrowing on interest TO
make both ends meet.
Interest May Be Raised
SO far the States loans this wear
have come from the irreduciblc funds
was borrowed with the express under
standing that at any time the Land
board can place It's money at a higher
rate than 4 Fer cent, the State must
either meet that higher rate of interest
or repay the money. To repay the
money now, of course. the State would
be compelled 10 borrow from banks at
a higher rate than 4 per cent.
Last year the State put itself in soak
IN great shape II borrowed all the
money it could from the Land board
and then ii hawked it's credit around
among the local banks. Finally those
institutions raised the rate OF interest
on it, aud it went to New York, where
it secured q loan from the National
Park bank,
Under the law, of course, all such
loans must be repaid by the State be-
fore the end of the year in which they
are made. The State WAS able last year
10 make repayment before the end OF
the year, on account of tax collections.
BY the same token, Salt Lake City will
be able to meet its ovcrdraft before
the end Of the year, Meanwhile the
State is paying interest and the city
ism T.
No Interest on State Funds.
Neither the State nor the city gets
any interest on the funds they have
on deposit in the banks; but the city
gets what amounts to interest, because
the banks are willing 10 carry an over
draft in its general fund in return for
the deposit and use of other funds
which are not overdrawn.
The State of Utah has hundreds of
thousands OF dollars on deposit in funds
other than its general fund, but either
it cannot or It's officers will not exact
any favors in return from the banks
a 4
The State gets absolutely no return on
a single dollar in any fund which it de
posts in any hank.
Cutters Bank Favored.
The Deseret National bank, ono of
tho church's financial institutions.
which numbers Governor Cutler among
its directors. lent $4,000 TO tho State
last year. As soon as the Land board
shuts down on the State this year, an
effort Will be made to borrow from the
banks. The Governor is chairman of
the State Board of Loan Commission
ers and 1T is a safe bet that his bank !
will not be overlooked in the shuttle.
Governor Cutler never forgets that |
he is interested in the banking business |
The secretary of the State Land board |
usually has large sums TO deposit in !
some bank, and Governor Cutler is in
sisting Tint tins money be deposited In
the Dcseret National bank. Thus far |
he hasn't been able to make Secretary
T c. Caliister see it that way, al !
though Mr. Caliister is the Governor Is I
appointee The bulk OF these funds
Mr.. Callster keeps at the State Bank
Of Utah, of which the prophet of the
Lord is president, and the balance is
kept in Mccormick e. Co. g bank.
John De Grey Dixon, Mr.. Callister s
predecessor. deposited In the same 1nan
sial institutions, and the inability Of his
own bank 10 control The Land board
funds is an exceedingly sore spot with
the Governors; but he has had to yield
the point, owing 10 religious and po-
~ 4;o,l cnnci5 ar ions