The evening herald. [volume] (Albuquerque, New Mexico) 1914-1922, 1915-10-01
GErTING RIsuITs.

ANlRNE Mho may &c ihAtlHth W
"A doub, the capacity for useful
4 = ness OF n Taxpayers associa-
ton. such % that which Taxpayers all
over New Mexico are now fiockiHg TO
Join. may read with profit reports and
bulletins Of the results which have
been achieved by a similar association
in Arizona. and OF specific results in
counties and cities where The local
organizations, conducted in conjunc-
ton with the general state associa-
lions. have been able 10 take hold OF
specific problems of public admins
tration which need correction. An in
stance directly in point is given in
the current number Of sunset Mag
aziBe." in lis financial section. II Il.
reproduced here:
In corporate and municipal finance
the sinking fund. the annual accumu-
lation Of fixed lnstallmcnts to retire
outstanding bonds. has been more or
less Of a joke perpetrated by the
bookkeeper. In most cities the sink
ing fund r. a pleasant fiction; il exists
on paper. hut the cash isn't there
When the bonds fall due they are re-
funded, which means that other
bonds are issued 10 take .heir place
snd the debt Is handed on TO postcritY
To remedy this situation the 1919
Arizona legislature passed a law COM
peliing all municipalities aud coun-
ties 10 levy an annual tax sufficient to.
retire any bond issue within the per-
iod the bonds run. II. for instance. a
bond issue falls due In thirty years.
the city or county must annually levy
a tax equivalent TO one-thirtieth OF
the total issue.
Tucson had issued sis5.ooO worth
OF waterwaras bonds; in 1915 another
issue 90 ge3a.O00 wac sold. Under the
provisions of the state law Tucson.
would be obliged to raise every year
Si3.4eG 10 AXE care Of sinking fund
requirements. In addition 20 the in
tercst. This item would give the tax
rate OF Tucson a boost which would
make itself plainly felt in the tax
bills.
Now Pima county. Of which Tucson
is the heart. has a taxpayers asaocia-
tion whose secretary. George "A.
smalley. Is charged with the duty Of
%scrutinIzing every bill and item Of cx-
pense n OF suggesting ways and
means to keep expenses down. Mr.
Smalley suggested a method by which
the bond issue Of $4,000 could be-
retired through a total tax ic.y OF
only S62,6Is: by the same method
the taxpayers would have to raise only
s90,To2 to wipe oHt the $3.50, 900 md
issue Of the present year.
Instead OF taking the money raised
by taxation for the redemption fund
and dcpositing 1t IN a bank where Il
would draw only two per rent inter
cst and whence Il might be diverted
into the fund Of some city depart
ment, he proposed that the eity iayest
the annual tax proceeds ia street i'm
provcmeut bonds bearing SIX per cent
interest and payable In ten years The
annual interest was 60 be rcInycstcd
in the same class OF bonds n the
interest would thus be compounded
az six per cent Instead OF ieyylug
an annual tax of $500 90 retire the
SlG5.00O issue. the totai amount to
hc raised and invested IN street iW-
provcmcut bonds would be only
ga.JsO ON the t239 600 issue AN au-
nual tax Of 1896 wac necessary To-
retire the principal iu thirty years.
by investing f3.os3 a year BOO street
Improvement bonds the compound iu-
tcrcst would accomplish the same ob-
icct IN other words, the Investment
81 tho sinking fund 90 the improve
mcnt bonds viii save tho taxpayer.
E250Gs0 In thirty years. sat OF 4.
total Of only y1ci,0o0.
The city council mas adopted 90,
association suggestion % is thorcbS
SAVING the |uixpayors $500 "a year
besides providing a hlna-rde sink.
ing fund and "a good market for loc1'
Improvement bonds other muuici.
palities throughout the west mas with
profit adopt tho Tucson method
LOVE OF HEALTH ~. FEAR or