Arizona republican., 1910-04-17
A Fascinating Scheme.

Because of its grOtesque absurdity the proposition that the Salt River Valley Water Users association shal issue it's bonds for some seven ol eight millions of dollars, sell then and from the proceeds return to ths money it has expended on the Salt River project, is interesting. All oi us have witnessed theatrical, produc- tions which were So atrociously punk" that their very lack of all merit served to entertain us. A simi- lar feeling is induced by this bond ing proposition.
 The scheme is so ridiculous that il is entertaining to think about it.
 Just consider The government has constructed for this valley q vast storage ana irrigation enterprise which is nearing completion as a purely irrigation project. Incidental thereto, the project now contemplates the fuli utilization of water power possibilities. to complete which will require two or three years more Pro- Vided that ordinary business judgment is used in handling the affairs of the association. repayment to the govern ment will not begin until the supple mental power project is finished. ia. ha citation will owe the government a sum approxin1ating. let us say eight . millions of dollars. The debt will bear no interest, and will be paid in yearly installments covering a period Of ten years. The revenues from water power converted into electricity will, it is thought, be so large that no land owner will feel the burden of paving his share of the yearly in stallments. At the end of the ten year period. after final completion of the project, the land owners. will own the storage and irrigation and power plant free of all debt. Thereafter the rancher will pay absolutely nothing for his irrigation water. The revenues from power will pay not only the expenses of up-keep for the entire irrigation system, but will yield a profit to the shareholders of the as- .sociatioa. In other words. the ranch CT will pay nothing for his water. and will get dividends on his stock in the association.
 The Salt River valley will have the ideal irrigation system Of the world
 What is the fantastic scheme which is proposed to take the place of this ideal arrangement? It is. in short, proposition that the association shall exchange a short-time debt which bears no interest for a longtime debt bearing interest. Supposing the i'm probable event that the bonds of the 6 per cent, the interest charge on eight million dollars would be the mere trifle of t4SO000 a year, not to speak of the annual assessment nec- essary for a sinking fund with which 10 retire the principal-a charge each year that would be greater than the annual net payments to the govern ment If it be suggested that this annual interest charge of s4SO.OOO would be reduced by the revenues from power. the answer is that any interest charge would be just so much extra and unnecessary burden.
 It is unnecessary to dwell on the many other objections to the scheme which at once suggest themselves. It is sufficient to mention that If any disaster overtakes the project within the ten-year period. the expense of repair will be made good by the gov ernment: that it is infinitely prefer able that the general administration of the project-the distribution of water. and so on-shall remain for some years in the hands of the gov ernment. and that the only beneficiar- ies from the conversion of the project into an interest bearing debt would be the people, to whom "rake-of1 would come for selling the bonds.
 Halley's comet probably is getting in it's work on the mental processes of some of our good citizens.
 Should it ever befound that the estimates of net annual payments to the government are erroneous De- cause of too sanguine figuring Of revenues from power-should it be found that the annual payments have become burdensome-a businessiike solution of the difficulty would be an issue of bonds guaranteed by the state of Arizona Such bonds. bear ing not more than per cent interest. could be sold readily at par. To pro- vide for this possible contingency, and as a matter of wisdom generally. it would be we'll to have our constitu- ton provide for a state guaranty of