The Union times. [volume] (Union, S.C.) 1894-1918, 1913-09-19
This Act Was Introduced
by Hon. L. J. Browning
of Union i'm 1912.
1t was One of the Important Acts
During Recent Years-Acf of
1912 Saves the State Many
Thousands of Dollars Annual
Iy-Blease Refused TO Sign
Bill, But Supreme Conr De-
ciares II Constitutional.


The Supreme Court has just rem
dered decision declaring the Re-
funding Act of 1912, constitutional
in every particular. AS this Act was
introduced by one of Union county's
representatives, the Hon. Lowndes j.
Browning, and as it is the most i'm
portant piece of financial legislation
that has been acted upon by the Cen
eral Assembly of South Carolina in
years, we have taken the trouble to
look up the records as given in the
Journals of the House and Senate.
It was introduced to amend in va
rious particulars, the Refunding Act
of 1892, which provided that the
state debt should be funded in Brown
Consol Bonds, known as 2O-4O's,
which means that they can run 40
years, or the State can pay them off
at the expiration of 20 years. The
State could exercise this option Jan.
1, 1913, and at any later date to Jan.
1, 1888, when the 40 years period
would expire. II
The old Act of 1892 provided that
the Bonds should bear 1-2 per cent
interest. The new Act of 1918 pro-
vided that they should bear per
cent interest, saving Of 1-2 per
cent interest per annum for 20 years.
~ The Act of 1892 proyided tAat ths
II +yS& Az, ~ " 1tt<@<
should sell these bonds, and for the
necessary expenses for carrying
through this transaction, should have
at their disposal, all the funds in the
State Sinking Fund.
The Act of 1912 provided that the
Sinking Fund Commission, which is
composed of the Governor, State
Treasurer, the Comptroller General,
Chairman of the Finance Committee
of the Senate, and the Chairman of
the Ways and Means Committee of
the House, shall float the new bonds,
and that for this purpose they shall
be allowed to use $4,000 of the
State Sinking Fund, and that the re-
mainder of this fund, amounting to
nearly a million dollars, shall be used
for calling in, and paying off that
amount of the indebtedness of the
State
The Act of 1892 provided that the
capital stock of any corporation in
vested in these State bonds, should
be exempt from all State, County,
Municipal or other taxes. The u. S.
Statutes provide that no State can
discriminate against National secur-
tiles in favor of their own State Sc.
curities. therefore, all capital stock
of corporations invested in U. S.
bonds in this State for the past 90
years, have been exempt from taxa.
tion. 1t is estimated that there is
now at least $s,OOO,OOO of the capt.
tai stock of the banks of South Caro-
lima invested in National and State
bonds, and therefore are now escap-
ing all taxation.
AS the banking interests of the
State grow, this will continue to
grow, and it is very provable that by
1888, at least $20,OO0,OO0 will be thus
escaping all taxation.
The Act of 1912 struck out this
provision, the author of the bill tind-
ing upon investigation that the cred
it of no other State except ours was
so poor that this inducement had 10
be offered to capital.
This bill was introduced by Mr..
Browning land we are now quoting
from the House JournaD Jan. Is,
1912, and referred to the Ways and
Means Committee. 1t received a ia
vorable report the same day at the
night session. 1t received its Sc .ond
reading in the House Jan. 20, and it
is the only instance on record where
a bill involving millions of dollars
was passed without yea and nay
vote. This was very high comp.i-
ment to the author of the bill 1t re-
ceived its third reading Jan. 80, and
then went to the Senate.
On Jan. 81, 1--WE are now quoting
from the Senate JournaD it was read
the first time in the Senate and re-
ferred to the Finance Committee of
that body. Feb. it received ia
vorable report from that committee.
Feb. 13 it received its second read