New-York tribune., 1908-03-02
RTLLION DOLLAR DEBT.
AssemUyman Bennett Sounds Warn-
ing on City's Finances.
-. Editor of The Tribune

tn
Sir. There is matter before the Legislature
g. the present time which. in NY opinion.
most serious matter now before il, and Vet no
mention is being made of it by the papers by
sry Of the voters My mail is burdened with let
rers regarding woman suffrage Sunday baseball.
1ir1section equal pay for women teachers and such
matters but not one word on the subject Of SWEEP
ius away the constitutional debt limit Of city
Of New York. In my opinion. the same economic
laws apply TO a city that apply TO any other bust
ness corporation 10 individual. The individual
who is a spendthrift must come to poverty. 5"
rhat city which is exJravagant must eventually
come 10 period of enforced poverty, in which the
future generation pays for the extravaganza of the
present When the present constitutional debt limit
vas adopted by the convention Of 1924 il was net
with cry that large. In 1904 how
ever il was increased as TO the city of New York
hy permitting that city 10 take out Of the compu-
tation of its debts when the question of the debt
limit came up all bonds issued for water supply
since January J. 1904
Controller Metz in his report in December came
out as an advocate OF further sweeping away the
debt lini; so far IS New York City is concerned.
A few weeks later the Mayor in his annual mes
sage presented to the Board Of Aldermen on Jan
uary & 1875. advised against Mr. Metzs proposition
saving From a practical standpoint II may be
found dangerous and i'll advised in tempting the
city into enterprises which il the end would re-
suit IA shaking financial stability
II view Of this conflict Of authorities II seems
70 ne that the wise thing is 10 examine caTe1uliy
into the actual condition OF the city's finances be-
fore making this radical departure The report OF
Controller Metz dated December c, 1851 and made
10 the Board OF Estimate and Apportionment. sets
cut The condition of The city page as follows;
Total net debt Of the city. looked at from
he standpoint Of The constitutional deDt 4e 81. 18
u asoertainiug what actual debt Of the
io@ias items.
ss4 Sas bonds s7as issued sine January 1904 55z7s
bonds issued and outstanding &C m
Bonds ana Corporate stock sold February %
T.s, ...... s7o2 s3o POS 0I
To this total should be added the large amount
Ct revenue bonds ISSUED in 1907 10 cover the de-
fciency il taxes Of 1896. From the above you
see that the actual debt Of New York city "flch
The city some time viii have 10 pay. is after TAX
ing out the sinking funds. away over s'oo'oOo'-
COS In additic- to this there has already been
started the Catskin Aqueduct The preliminary
estimate Of the cost OF that project Is ACCORDING
10 the report the Board OF Water supply
SIC egea In addition. according TO page OF
the report Of Controller Metz to the Board OF
Estimate The srno,,nt Of corporate stock author
lied but not vet issued for use by the various
departments for other purposes Is SIso'7
esq II add 62,0O00oe ana SI9''OOo'V00
and s7J1es0@oJ together We have d tota4 III ca
cess of $1,000 000600 Of indebtedness not an oi
II actually incurred. but all Of ii already au-
thorized and this is without beginning any Of the
subwsys and other improvements for when the
city is ciamoring.
Al examination OF the various financial reports
q the city shows that the proceeds of its hI'S-
year bonds and stock are being used 10 pay running
expenses and 10 pay for such temporary supplies
blankets harness bicycles and for such tenn
porsry purposes repaving, sodolng OF paih9'
furniture for schoolhouses 10 the extent OF pet"ee
g,5,ga and sl0Oo0g GO year All Of these matters
should be provided for by annual taxation In MY
rirta -a.a r4Tz- iG all
course tie debt of the city viii be so large In Ten
O. fifteen years that il will be Impossible ior 'e
city 10 sell bonds any terms, and yet the next
generation viii have problems before it OF greater
magnitude than this generation has ever dreaineo
OF because the city will then probably be soldIy
built I'd from the lower end Of Staten Islard 10
Flushing and from Far Rockaway 10 fonkers.
There are two things then consider: First, the
building of the necessary public improvements oe-
nsnded 10y the present generation; and second
TIE preservation of credit Of the city for the
neKt generation In my opinion all the improve
ments nee6ed can be begun and competed without
Increasing the debt limit The following tap4e
shows ;het The city viii have ample revenue Inc
city should have annually the following amount 10
spend.
Fl,t, he annual Increase in the debt margin margin
n@sed Upon 10 cent Of the annual inc[e@s s
ss sssesssd yaI9ation as pes se ef9 ss2 ss7 $50
Redemption Of asDt from taxation. page 100 ooo
Annual in the sinking fund. 100000
Tosi ............... $40, Sf1fsso
In addition since city is in such hnahclal
traits. rather than sweep aside the debt hHlit' II
seems much the wiser course to ADD one
snth % per cent TO the annual tax rate 10 De
oseo either IN redeeming the debt OF for putting
Nlect into permanent improvements On the Dd9i'
U the lnf report this would add S6.Z4oeco 10 tile
@ooVe amount, and the assessed valuation M
eeases by the growth Of the city this amount VIII
" Increased every year
Aho y the city were stopped from using the pro-
leeds of Af;y-year bonds 10 pay running expenses
~Ao pay for temporary departmental supplies tilaI
HeHId add least 10000 year 10 the fund for
armament improvements In other words, there is
~ Eight during the next ten years at least s5vo'-
WV borrowing capacity for the cost Of public
improvements other than supply No i'm
"0l II always takes d number Of years, and the
eeoed improvements can be started and the funds
Ase1 from year 10 year and the city at the same
fns can be kept in paths OF conservation and
Ae Present debt limit be maintained If, how
"' se enlarge the debt limit every time self
'porths public Improvement is finished and the
T al the time issues bonds and stock 10
a. AMOUNT Of the foregoing annual Increase in the
~ margin the debt Of the city inside OF fifteen
s Ell be szoS.15o1Oa. and E.at VIII mean that