Lincoln County times. (Jerome, Idaho) 1911-1919, 1914-12-24
IRRIGATION SECURITIES.
nil Now Before Congress Having
far It's Purpose the Strengthen
ing of These Securities.


,onsIdered. is OF momentuous import
,uee TO the people OF Idaho. not 80
much that they are large holders OF
irrigation bonds. but from the fact
that these bonds must carry with
them some value in order to find a
place In the financial markets The
hll calls for the guaranteeing OF
these bonds by the government, and
the benefits TO be derived by this
state through the passage or this
measure Is clearly pointed out In Il
letter from Governor Haines, copy
Of which follows. and We believe the
sentiments OF the Governor as herein
expressed will find hearty endorse
ment by the citizens generally
throughout the state.
Mr. l. NJ Rice. 72l Riggs Bldg.
Washington. ID. c.
Ny Dear Sir:-I have your letter
Of December 10th enclosing a COPY
Of Senate Bill No. 6S27 introduced
into the senate OF the United States
by Senator Jones OF Washington. and
relating TO the reclamation OF arid
and overflow lands through district
organization and endorsing govern
ment aid therefor
You request me to express an opin-
Ian 70 h.. 81 81 l.. 4
In reply viii say that the principle
Of the bill has my unqualified ap-
proyal
The State OF Idaho has 100000
acres OF land reclaimed by irrigation,
and with Senator Jones' bill in ope-
ration We could build irrigation
works for the reclamation OF $780,
600 acres more. No new irrigation
works are being built in the State OF
Idaho at the present time for the
reason that there is no market for
Irrigation securities. and the princi-
pal reason that there is no market
for irrigation securities is because Of
a lack OF faith IN the financial sue
cess OF irrigation projects
About ten years ago great many
western enterprises We're undertaken
In the West withou; due investiga-
uon and consideration. with the re-
suit that a number OF them were f.
nancial failures. Heavy bond issues
were placed against these enterprises
and these bonds were purchased all
over the United States and many OF
them were sold In foreign countries
The losses that followed have caused
the purchasing public to become very
skeptical In reference to the nnan-
cial end OF irrigation enterprises
This might all be cured by the
Jones bill. II these bonds were made
to run for a long Leriod and the in
terest on them were guaranteed by
the United States government. they
would be almost as attractive as gov
o.nincnt bonds and would sell at a
very low rate OF interest. possibly 1
per cent. With a market for such Sc
curities we could readily finance g.
100000 acres In Idaho. We have the
land and the water. This would af-
ford homes for many thousands OF
worthy and Industrious citizens OF
the United States and add to the gen
eral greatness OF the country.
Not only would the Jones bin en-
able us to reclaim this vast area, but
1t would enable us to reclaim 1t at
practically one-half the cost that we
have paid for reclamation In the past.
AS before stated, there is no pres
ent market for irrigation bonds sold
at from 60c to soc on the dollar
with a liberal supply of the capital
stock OF the company thrown In foi
good measure.
For example. II 1t was desired t.
raise 81, 100000 to build given pro-
ject, It would be necessary to issue
securities against 1t amounting t'
Sl,66O,OOO. These would ther b'
discounted at 60c to raise the reqnir
ed s1,OOO,O00. Not only we're tn
bonds sold at a ruinous discount bu
the interest rate was higher and o.
the basis OF the discount II was a
enormous burden for the construct
Ing company to carry. Consider'h
the interest and discount charges
think | am entirely safe In sayin
that project could be built for on'
half the sum that 1t cost under IL
system that we were pursuing IL
cause interest on government qua
anteed bonds at per cent won
sell at par.
The government OF the Unit'
States could very properly and safe
guarantee the interest on the
bonds in view of the fact that befo
such guarantee was given the fea'
bility Of the project was to be inv'
tigated and approved by the unit
States Reclamation service. 1
United States Reclamation servl
has established n splendid organi;