Ottumwa tri-weekly courier. [volume] (Ottumwa, Iowa) 1903-1916, 1910-07-14

PEOPLES Pul PIT.


L
Editor of the Courier,
Sir: Your editorial in yesterdays
issue made manifest the inadvis-
ability of the issuance of county fund
ing bonds as proposed in the so-called
contract signed by George M. Betchel
& Co., Of Davenport, and by the county
treasurer and members of the board
of supervisors AS a business PROPOSE
ton, there would seem to be no ques-
ton that this IL an inopportune time
to sell bonds, because the money
market is tight and such securities DO
not now command as high price or
carry as low a rate Of interest, as they
will when the money market becomes
easier. have talked with number
of bankers, and they all express their
belief that money will be easier In a
few months. The contract for the sale
of the bonds to Bechtel & Co., has
been referred to, but nave not seen
a copy in print. The following Is q
copy of the contract:
! .OttumWa Ia, July 5, 1910.
ITO Jas. v. Curran and Members Of the
Board Of Supervisors, Of Wapello
] County, Ottumwa, Iowa.
"Gentlemen:
| fOT approximately $0V,uOO 90 luAiu
| ing bonds to be issued by the county
under date Of July l. 1910 and to be-
come due and payable one-ffth April
first of the following years, viz: 1921,
1922 1923. 1924, 1925 we will pay you
$4,000, pay any accrued interest that
may accrue between the date of the
bonds and the date Of their delivery
and in addition furnish the blank
bonds and legal proceedings free OF
expense to the county.
the county. n
"The county to furnish us with certi-
fed copies OF all proceedings sufficient
to evidence the validity of the bonds to
the satisfaction of our attorney
Respectfully submitted,
Geo. M. Bechtel & Co.,
"By Geo. Wait
"The above and foregoing PROPOSE
ton being accepted we agree to deliver
Bechtel & Co., Davenport, Iowa, when
issued
The above is signed by the county
treasurer and the members of the
board Of supervisors.
In my opinion the above contract
is invalid for the reasons given below.
| The county treasurer has furnished
| to me list Of the Indebtedness of the
county which 1t is proposed to fund
Eby the issuance Of the bonds contem-
plated in the above writing:
County farm .............$ 5,l92.O9
| County bridge warrants. 49,. 7,Oo9.l4
County warrants, general
fund lo,USf.ff
County fund, overdrawn. 80. 13,345.73
lOS6l ........E.i.i.... -. 9fl,ooA'1o
The county treasurer advises me
that it is now the purpose to issue
$4,000 in funding bonds. Therefore,
1t is plain that the bonds will include
the Indebtedness Of $7.059.14 repre-
scented by county bridge warrants.
Taxes to pay the bonds will be levied
on all property in the county, includ-
ing property in the city of Ottumwa.
Under the law the city of Ottumwa
constitutes bridge district by itself
and the county outside Ottumwa con-
stitutes another and distinct bridge
district The supervisors have no
authority to levy bridge taxes in OF
tumwa, and the above Indebtedness
of $7,059.14 is for the construction and
repair of bridges outside of Ottumwa.
At present property in Ottumwa is
not taxable for the purpose Of paying
such bridge warrants If the funding
bonds are issued as proposed, then
property in Ottumwa will be taxed to
pay the principal and interest of all
the bonds. Including interest, the tax
payers Of Ottumwa would have to pay
at least $4,000 upon bonds represent
ing bridge warrants and for this there
Is no warrant of law to assess them.
That city property cannot be taxed for
| such a purpose was decided In the
case of Benjamin F. SHUTS VS.. R. P.
Dana county treasurer ct al, decided
by the supreme court of Iowa in 1903,
and reported in 1873 Iowa, at page 244.
In that case the only Indebtedness
represented by the bonds was on ac-
count of county bridge warrants. In
the present case. II county funding
bonds were issued as proposed, the
Indebtedness on account of bridges
would be so combined with other obli-
cations that it would seem to be i'm
practicable to separate the different
items The law permits the issuance
Of bonds to take up the Indebtedness
Of county incurred in the construc-
ton and repair of bridges. but taxes
to pay the principal and interest o.
such bonds are to be levied only on
property outside the limits of city OF
the class Of Ottumwa. BY. the con-
tract set out above, 1t does not appear
that separate bonds are to be issued
to fund the county bridge warrants OF
$7,059. IA I have no doubt the board
Of supervisors will correct this evil
dent oversight, for they would not
wish to saddle debt Of $4,000 on the
tax payers Of Ottumwa without any
justification or warrant of law.
From q reading Of the statutes !
am convinced that the above contract
is not enforceable against the county
for another reason. The treasurer
and the members of the board OF sup
ervisors not being lawyers. it is not
surprising that this phase Of the tran
saction has not occurred to them.
Section 404 of the code provides that