Little Falls herald. [volume] (Little Falls, Morrison County, Minn.) 1889-1950, 1912-07-05
NIN MINNESOTA
TWENTY-THIRD ARTICLE -EHX
@e COST OF GOVERNMENT N !,
81 MINNESOTA @ q, i


was called to the fundamental dis
tinction between general revenues. d.
rived from taxes, licenses, fines, etc,
special assessments and the earnin0
Of public service enterprises; and Il
was pointed out that unless these class
es Of income are reported separately,
no one can find out how much or hsW
little OF burden the government
really imposes on the people.
On the side of expenditures, m
equally fundamental distinction M-
lists between maintenance charges 2asE
the cost Of permanent improvements.
Under maintenance are included cur
rent expenses Of all sorts, ordinary rs
pairs, and such per cent for depreeia-
tion as will be sufficient to renew tbs
physical plant by the time it is worn
out. This sort Of accounting is CUSTOM
ary in all well-managed private enter
prises; it is equally indispensable IN
all public service enterprises under
taken by the municipality; and it 10
essential in the ordinary operations df
government, if the public is to haHe
the means of knowing what is tho reA
cost of government, and whether cur
rent revenues are equal to the ! ex-
| penditures properly chargeable against
, them.
Permanent improvements, on the eth
er hand, cover investments in lands
buildings, bridges, new highways ana
other physical properties which are
! designed to serve for a. number ct
years. Expenditures for such purposes
are often met in whole or in part by
public loans; and in any case they a1o
not properly part Of the cost of gov
eminent in any one year, but should be
spread out over number of years cor
responding to the durability Of tho in
provements in question. s.
It is therefore absolutely necessary
to- separate payments for maintenaAno
from payments for permanent improve
ments, both in public service enter
prises managed by the municipality
and in the ordinary operations Of tho
| government. Unless this is done Cand
in the systems of accounting used By
municipalities it is often not done) No
one on earth can tell what is the trne
cost of government, nor whether pub-
lie service enterprises conducted by tie
government are really making money or
losing it, nor whether the present Ken-
GRAFTON is paying it's way, or saddlinE
upon the future not only the cost of
! permanent improvemfnts but .. pa1e 06
1.-The expendituTee9f fer the salaries IS II
public Officials and other ctfr6n .a1E-
penses. - -<.:.: .
In fact there is no doubt that various
municipalities actually have revenues
insufficient to pay maintenance charg-
es plus interest on the public debt, and
as result are every year going deep
or into debt to meet current expenses
by piling up larger masses of unpaid
warrants, or overdrawing at the bank,
or borrowing money and using part
of it to pay bills which should be paid
from revenues. This is clearly the road
to financial ruin, yet it IS to be fear
ed that some communities are treadinR
it,, quite unconsciously, because Their
public accounts neglect these fund.-
mental distinctions; and unless these
distinctions are observed, financiA
statement tells little which it. is in
portant for the public to know. ..
It was in view Of considerations sue6
as the foregoing that the schedules fR
the present Investigation into the cen
of government in Minnesota were pres,,'
pared so as to call for q Sc eparation .m
| SpcC1d1 dSSSSSulouCS 1rOHu Cd4Se, Of k04".
eral revenues from commercial. rev
enues, Of all ordinary receipts. fren
loans and other extraordinary receipts,
of maintenance charges and interest
from payments for permanent improve
ments and debt reduction, and finally,
for a classification of the outstanding
debt according to it's character and tho
purpose for which it was incurred. This
undertaking is unavoidably more or lees
burdensome for the accounting officers
who are called upon to divide some of
their accounts in order to fill out the
schedules, and it is not less burdensome
for those in charge Of the investiga-
tion; but it will be well worth doing
if it brings more clearly to view ths
real cost Of government in Minnesota.
In subsequent article, later in the
summer, it is hoped to give some Of the
results Of this investigation into the
cost Of government in Minnesota.