New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1909-10-23
III

.s-ss, charges is one of the direct re-
.ults Of the method by which money is
ohtained. through the sale of revenue
bands In excess OF the taxes collected
70 redeem them. 10 pay the cost of city
government.
The city's interest bill upon tax rev.
erues borrowed in anticipation OF their
collection upon revenue bonds in 1879
was only s759.379: in 1908 the amount
had Increased to S5.65O.4 .4O3. The tax
levy in 1889 was 6.1sO.O71. and only
S4sO27. $50 Of that amount was bOr-
rowed on revenue bonds. The tax levy
N 1905 was Sll6,542 500. and the enor-
nous sum Of s127 .e1l.O0O was borrowed
On revenue bonds. The average rate OF
interest in 1899 was little over IL per
cent on the revenue bonds sold during
that wear: the average rate of interest
in 1908 had Increased to nearly AZ per
cent on the revenue bonds disposed Of in
that year.
In the early years following consolida-
tim revenue bonds were not issued n
ANYTHING like the amount Of the tax
,.,,z, The oficial records also lemon
strate that the bonds were practically
su redeemed during the year of issue.
Interest charges were consequently very
much smaller, even upon the amount Of
bonds issued. than in more recent years.
BONDS AGAINST ARREARS.
Al the beginning of 1903 there were
uutstanding 500. 467. 500 Of revenue bonds
al had been issued in 1901 and 1902
srainEt Hncollected taxes Of the levies OF
those years. It was in this year that the
practice Of issuing revenue bonds against
the arrears Of taxes Of former years was
commenced. BY this means So. $4,000
Of these bonds, issued in 1902 against the
taxes Of that year. were refunded for a
further twelve months by the issue OF a
new lot Of bonds.
Another and still more questionable ex-
pedient was resorted 10 by Controller
Grout in 1908 TO take up maturing reve-
nue. bonds that had been issued in previ-
Gus years in excess of the taxes collected
10 redeem them. During that year there
were issued Ss.I00,0OO of revenue bonds,
70 run for a period Of three years. bear
ing interest at A per cent per annuHl-
The issue was divided as follows: One
hundred thousand dollars against arrears
of the 1902 levy, S5.0OO,0O0 against ar
rears Of the 1903 levy and S1.0o0.00O
against arrears of the 1904 levy The
interest paid upon these bonds was
1927. .375 for each Of the three years from
1903 to 1905. thus costing the city an ag-
gregate Of SS92. l25 in interest charges.
Il is very doubtful whether recourse to
this expedient was legal but, be that as
II may. the folly Of such a proceeding
was demonstrated by the results. The
records show that during the three years
that these bonds ran the total collec-
tons Of arrears OF taxes Of the levies
against which they were issued were
only S6.02S. .024, while the expenditure
upon budget appropriations and for the
redemption Of other revenue bonds sub
seQuently issued against arrears of taxes
Of those years was S17.27L225. In 1908
the present Controller was compelled 10
fnd So 100000 10 redeem these revenue
bonds upon which his predecessor OBJ
tained money for redemption purposes
away back in 1908. This is only a
sample Of the condition brought about
By the refunding Of revenue bonds by
the issue Of a new lot Of bonds 10 run for
long periods Of years.
CARRYING OVER OLD DEBTS.
Il was doubtless the working out of
Controller Grouts eXpedient Of taking
up revenue bo-ds and refunding them
50 that their next redemption would be-
come a problem to be solved by = sue
oeeding administration that induced the
Present Controller 70 secure from the
legislature authority to fund all obliga-
nons and debts represented by taxes Of
4eEies prior TO 1905 that were considered
70 be uncollectble. Immediately follow
ing this legislative enactment the Board
u Estimate authorized the issue of S36-
"1VOO Of corporate stock for the pur-
pose. Al the same time authority was
ascareo from the Legislature for the
Doafd of Estimate 10 include in each
.esf budget an appropriation large
~NouSh 70 fund all obligations and deb:c
-'iesented by taxes Of leVies after and
including 1865 that were regarded as un-
eonectible. Thus, al the very beginning
MS term OF Office Controller Metz
.euipped himself with all the necessary
ssl ana administrative authority 10
'lialiy dispose Of and pay of all revenue
D'Has' which, like those that his prede-
9s9f had refunded for a three-year
iA' represented money obtained in
s-s'lous years for budget purposes in
-osas OF the taxes collected 10 redeem
them.
me progressive Increase in the load Of
'siest charges upon revenue bonds
3t has been piled up from year 10 year
Continued on fourth page.
.sgg.ss ,gWsst Point sits among her October hills /