Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1910-12-14
CITY COUNCIL

anu MT. n. Il. oShiClt wa iC-SiSStoo
Police Commissioner from the Third
ward by joint meeting.
BOARD OF. ALDERMEN.
| Mr.. Field, from the finance COM
mittee, submitted the final report OF
the committee in reference to the re-
funding of the city debt. The report
will be found in full elsewhere in the
Gazette. -
Mr.. Field said much OF the work in
connection with the exhibit had bee n
accomplished previous to his appoint
ment on the copnaittee which had also
been aided materially byAuditor Price,
Continuing Mr.. Field said:
"As shown in the report just pre-
scented and read, in March, 1909, as the
time of maturity of the bonds OF 1879
approached, it became evident that
there would be somewhere in the
neighborhood OF $4,000 OF our new
civ bonds unexcltauged and unsoid,
and that some provision would have to
be make for tho redemption OF the Id
bonds, either by q temporary foan,co
the sale of the new bonds to the highest
! bidder. The finance committee adper-
tised for bids, or for the s!lbmiss
sion of business FOR fscalI pro-
position whereby the city would be
enabled to pay for the maturing bonds.
Representative of Messrs. Hamble-
ton & Co., bond brokers, of Baltimore,
the Citizens National. and the First
National Banks, Of this city, were
present. The only offer for the pur-
chase OF the bonds was received from
Hambleton d Co., at 95.26 and in
terest. The committee, after con-
sidering thcmatter very carefully,
felt that, in viewof the generous
and patriotic response on the part
OF our people il exchanging che
old 3.65's for tho new As on 4
par basis, in face OF the fact that other
municipals of corresponding values
were selling around 90, it would DO
right and best to make every possible
effort to dispose of the balance OF the
bonds around. par, and for this reason
it would be best to negotiate 4 tent
porary loan, and carry the bonds with
that end in view. The bid OF Hamble-
ton & Co., was therefore, declined, and
an offer OF the First National Bank OF
Alexandria, to negotiate 4 loan Of
800, 0C0- or more, at 3 - per cent.
for four mouths, was accepted. The
loan continued at 3 10 por cent. until
January 1st, 1910 eight months). from
which time it has paid 4 per
cent. Notwithstanding that commercial
PAPER in Philadelphia and Baltimore,
rs we'll rs smaller communities, was
paying per cent. and demand coli
lateral paper WAS freely offered at D
and 81 per cent. I do not mention
this last fact to exploit the success OF
the bank in carrying this loan ut the
low rate, but merely to show condl-
tons az they existed, that wc may see
that we have much upon which to con-
graduate ourselves. We we're not in
cined to be pcssimstic, as regards the
future, or become alarmed by cory
temporary wind that blows, but We
could not coatinue indifferent TO exist.
ing conditions, as regards 4 per cent
securities, which appeared 10 our minds
and to the minds Of those who, in
larger fields, were in betterpositlon TO
Judge as 10 the future OF such securities
After carefully considering the matter,
We felt justified in submitting to you for
your consideration certain facts which
come to us in the experience OF other
communities and in the regular course
Of business, and that now that the COM
mttee had shown its good faith by a
conscientious effort to dispose OF the
remaining bonds on par basis, it was
we'll to yield to conditions and make
1.-THE concession necessary to effect a
sale. City OF Danville and city OF Nor
folk is have been recently offered at
90 and 92I, respectively, yielding
nearly ~ per cent. City Of Lynch
burg As are rather freely offered at 90
and interest, yielding about 4.31 per
cent. These prices include brokers
profits, or commissions. The city OF
Philadelphia opened bids on May 18th
for S9,000,000 OF + per cent. bonds;
only sS47 600 were bid st about par;
and it is said they will have to raise
the rate to float them above par, as
other large cities have had to do.
On May 23rd, the city Of Baltimore
| opened bids on $4,000 OF 4 per
cent. bonds, and only s240, 600 Of this
amount we're bid for as high as par.
These bonds are non. taxable, which
should make them especially attractive,
as, at that price, they are practically a
4 ID per cent. Investment for residents
OF Baltimore. The bids were as low as
95, and averaged 81 IL. We do not
feel that these prices are due i'll any
way to temporary conditions, but are
the result OF a gradual demand on the
part OF investors for higher rate. For
some time the ordinary interest rate,
on municipal bonds especially has
been SO much less than can be real
lied on money used in other channels,
that buyers simply refuse to consider
them. tn the larger money centers
where rates are usually lowest, demand
loans secured by active, listed collaterals
are bringing from 5 per cent. TO s per
cent. It was therefore, unreasonable to
expect that the loan would be carried
much longer at 4 per cent. rate. We
we're therefore, face to face with the
proposition as to- whether it would not
be better to sell the bonds ou basis OF
other Virginia bonds and be rid OF the
matter once for all, or 10 pay the slight