New-York tribune., 1910-03-08
BIG NEW ISSUE
OF CITY BONDS
SINKING FUND FIXES
RATE 1T III.
Controller 1HHOuHccs 5O-Ycar
SO, ,O00, ,000 Sale. 5cith Nezc
Redemption PriJilege.


differ from any the city ever put out be-
fore. In the past il has been usual TO
make the bonds run for a period of fifty
years This issue will be OF ffty-year
bonds, but there will be the provision
that the city may retire them or any
part Of their at the end Of twenty years.
The majority Of bond issues in recent
years have been As. but some of them
have been las. No city bond has ever
been issued before at a Al. per cent
rate
The announcement followed a meeting
of the Sinking Fund Commission late in
the afternoon. at which the rate was
settled. At the meeting last week Con-
troller Prendergast and President Mitchell
of the Board OF Aldermen were the only
ones IN Favor of the AZ per cent rate.
The other members Of the board. includ-
ing the Mayor the City Chamberlain and
Alderman Dowling, chairman Of the
Finance Committee of the Board OF AL
dermen, favored a per cent Issue.
Since then, however. the Mayor 1ad
thought the matter over. and yesterday
he declared ne was willing to accede 70
morning J. p. Morgan. jr of the Nor
gan banking house. had a talk with ths
Mayor regarding the bond issue, and IL
supposed 20 have told him that in the
fresent state of the bond market AZ
per cent Issue would be much better for
the interests of the city
Under the law the bond sale must bs
advertised for at least ten days. The
exact date of the sale will be deter
mixed to-day, a2d tae advertisements
VIII be placed at once.
The Controller announced that the
$.O,U<y0, ,OJU ysouid o. appOrtioned as fol-
lows:
Thirgy-;,,o million C.oi.aTs Tor various
municipal opposes. including the pay
menJ o. ;,loat SiI,lGo,tsO OF awards on
land concentrations.
Tveivc 1...-.ioa t.o!.a-s 10 iro, ide for
The vateE supply.
Six i,-i..iou collars for ih= construction
Of subWays.
Prender5ast Explains issU:.
Ihe following statement regarding the
bono sale y as issued b. TIE Controller:
4
charge al o,tsl~.4.-.i5 o~.4See'"ns ~
Ws..Gs Waica Wee Cu4--4---4ed 'ip TO ian
uary }.'', and $50 - ,---vt 5-".i1l;.,' a.
contract hab'hvIes Ii.t-- t..s IA; Ilhs VIZ
place she city ou a aO-.,ld Cseuit oasis III
It's relations with contractors &Eid the sen
eval public. 1ndtrrIaii. -cuuclhS ln'tre
There is nos awairirs payment approx
inateiy si5.e.ueto IN awards. All or Whth
in Tnanr cases the title to the properties
represented n these awards .-e. -ested IN
the city ivc and SIN years age Moneys ara
due 10 persons Who have been GivsSteo o.
their properties. no payment haElnS rsen
made and III some Instances they have
been reduced To absolute p"nurI- me city
should under ordinary circumstances ne IN
a position - diSc..s.rAe e SCcSe and al Other
oh;i-atirus with veaSouab.a rrCmptituds-
Further. uiue-teuths % rlesc awards ars
dra wing per cent interest The advantages
10 the city of IquidatinS this very heavy
item beJueatGNd by the last administration
is so obvious as 70 require no further COM
The issue OF 100000 will but little re-
duce the city's legal borrowing power o.
SIS 764. .2NT So This legal limit was arrived
al after making allowance for SIS .Is5 0e
Of contract and land liability. large pro
10 which reference has been made. viii b
Iiduidated by the funds made availaole BY
this sale The sum of $1,000 900 OF the issue
applicable TO water purposes IS. OF course.
excluded from the debt limit b. Constitu-
tional provision.
1t is the opinion of the Controller that
if at all possible the city should mako
it's issue of corporate stock at regular in
tervais. and preferably. not more than
twice year. one issue in the spring and
another in the fall.
This policy II followed said the
Controller will impose upon the city
the responsibility OF adjusting its finan-
cial affairs in conformity With this plan.
and will have the advantage of giving
the investing public more definite idea
OF the periods when the city will make
its corporate stock issues"
1t has all along been the opinion OF
Wall Street that heavy new issue OF
city bonds at 4 per cent could not find a
market. but il is believed that the fixing
of the interest rate at AZ per cent will
insure the placing of the issue at prices
satisfactory to the city authorities Tho
4 per cent bonds of 1853 and 1859 which
declined sharply on Friday TO 99fs and
99ss. respectively. on heavy trading. In
duced by the possibility that the new
bonds would be AZ per cents. both closed
yesterday a, 99%.. The 4lss of 1897
closed AT 1US' and the new 412s Of .hs
same year at 1OS1s.
New Features OF the New Bonds.
The redemption privilege. although
new in bonds of this municipality. Is
common with bonds OF railroad and in
dustrial corporations, which. however,
usually grant premium. Several gov
ernment issues have the redemption
clause. among them the war loan ct
1898. redeemabIe at the pleasure of the
after ten years and due and
payable in 1915 and the Panama Canal
loan of sSO.OO0.Oo0, maturing in 1885. but
after August I, 1916. One ~
tho Hawaiian loans combines this feature
with the other novel feature OF the new
city bond issue of A.. per cent interest
this Hawaiian loan of s1.000. 600 ~, per
cents, issued in 1900 and maturing n
1920. being redeemable after January
> 1910.
In the great majority of Instances
bonds bear interest of an even figure or
an even figure and half. as 5 per cent
or AZ per cent. The most conspicuous
example of the splitting OF the fraction
is the French loan of the Pennsylvania
Railroad Company. which bears S& per
cent interest. One OF the subsidiary
OF the Pennsylvania system
has a mortgage at "a per cent and ons