The sun., 1908-03-25
THE BAReE CANAL,
one Remarkable item IN the Bwden Of
POlly This State II Carrying.

FROM the Rochester Post.Erp1eAs.
An amazing blunder was made In the LeKs.
lature OF isos-lt Is impossible nov 10 detey.
mine who was primarily responsIbls-whicb
is costing the State N.0OO 900 year.
IN 1908 the barge cana act was submitted
20 the people and Was approved by them
II provided Tor the issuance OF liol 900 .O0D
Of eighteen year bonds, 10 be sold vhss
needed. the proceeds TO be devoted TO barge
canal work. and II provided for a sinking
fund In these words:
There IL hereby imposed for each year ahsr
this sct goes into eject until all the bonds ,susa
under the authority Of this act shsu be dua An
annual tai Of twelve one.thoussndths Of mill
upon each dollar OF valuation Of the real and per
SonAl property In this state subject 10 taxation for
each aud every million dolAp or part ,hereoiin
par value Of said bonds issued and outstu udins In
any OF the said 6sea years. tbe annual amount NJ
such taI 70 be computed by the Comptroller. which
taxes shall he devoted TO the sinking fuAd which
10 hereby created pay msbt from which shall olb
he made 70 the guishment OF the ndebtednsu
created b. the sale Of the aforesaid bonds As ire
said bonds become due, and for no other purpose
whatever.
Here, then vas provision for = sinking
fund into which payments should be made
upon bonds actually Issued and outstanding
In 1905 the people amended the Constih.
ton 90 az 70 mako the bonds run hfty YEAR
instead OF eighteen years In 1908 the Legs
lature passed an act TO conform the statute,
10 this requirement but no doubt if NO.
Willingly did something more, II provided
for the annual payment into the sinking fund
Of the proceeds Of = tax OF lsl.lOOO OF a mill
upon every dollar Of real and personal prop.
erty, not upon the amount OF The bonds ao-
tually issued and outstanding. but upon tha
whole amount OF bonds authorized that is IN
say, upon 500. 900 900 OF bonds. two millions NJ
the sIOl 900 600 having been Issued Ss eighteen
year bonds
In hls discussion Of the finances n the
state which We published recently Senator
Armstrong said: Whereas the whole Smou1t
of outstanding canal bonds on September ~,
including the remainder Of the 90. 100000 loan,
was Sl7 go, 900, the amount Of the canal sink.
ing fund applicable TO that debt was 81 -? ooo.
That is TO say, more than half the debt Il IN
the fund already, and IL will not be necestar-
to pay the debt for atty years, So A. this
rate the amount necessary to redeem the
bonds will be paid into the sinking fund
before the debt il created or the cansl fin.
shed perhaps.
Senator Armstrong says the payment into
the sinking fund should be based upon the
amount OF debt actually created, NOT upon
the amount authorized, and Of course he 10
right about II. n the change wer" made and
the change would be strictly In accord With
business methods. the amount Of money 10 b.
taken annually from the current revenues NJ
the State would be about four millions less
than II Is nov. This Ia very important
matter, for owing TO the present falling on in
tho States revenue drafts must be made upon
the states surplus.
The advocates Of the barge canal are IN
control OF the Legislature and 50 far th"y
have refused 10 permit the passage Of q biz
making the change that Senator Armstrong
suggests Great difficulty has been eNper.
enced in marketing the barge canal bonds.
which draw only per cent interest. Even
the subsidy granted to the banks, amounting
10 per cent. has failed to make the bonds
attractive 10 investors. And 90 the suggestion
has been made TO the barge canal advocates
that they 90 before the people with PROPOSE
tion to enable the Comptroller 70 sell the bonds
al rate ofinteTest which would make the bonds
attractive, the rate OF interest 10 nuctuAte in
accordance 18th the fluctuations OF the money
market: and II this be done the Legislature car
then correct the bunder with regard 10 the
sinking fund But The friends Of the barge
canal are afraid TO allow any proposition to
go TO the people. being fearful Of a reversal In
popular judgment upon the proposition a.
whole. SO that the probability 10 that the
present unbusinessliks and expensive pro.
vision as 10 the sinking fund must continue,
the barge canal advocates being the masters
Of the situation in the Legislature.