Arizona republican., 1916-11-19


 of Arizona attended the federal farm loan meeting held in the federal build- ing here yesterday afternoon. A suffi- cient amount of evidence relative to the farm loan needs of the state was given the board to keep the members busy for several days.
 The Farm Loan commission was late in reaching Phoenix and proceeded at once to a luncheon with the local re- ception committee at the Hotel Adams presided over by George J. Stoneman. At Mir McAdoo's suggestion. speaking at the luncheon was dispensed with and the visitors proceeded to the Fed eral court room where the public hear ing was at once opened, the commits sion, comprising Secretary McAdoo and Messrs. Quick, Morris, Lobdell and Smith being present.
 Secretary McAdoo opened the meet ing with a general outline of the Ob- ject of the farm loan act, telling of its advantages to the farmers. Its pur- pose was to serve the community as a whole. not farmers in any one specified district.
 The farm loan banks will be opened not later than February of next year, stated Secretary McAdoo. There is possibility that all preliminary work will be completed in sufficient time to warrant their opening at an earlier date, but we cannot positively give as surance that everything will be in read mess before the first of February, he said.
 The farmers will be able to borrow in such amounts as he may desire. sub ject to the limitations of the act, for period of not less than five or more than forty years In any case. 1t Is announced. certain proportion of the principal must be paid each year with the annual installment of interest.
 The twelve federal farm loan banks will start operations with a capitallza- ton of $9.000.000 or s750.O00 each. This amount win be but a small percentage of the amount that will be required for the purposes of the act. After the in- itial amount of $750 900 for each bank has been exhausted, additional funds will be procured bv the issuance of fed eral bonds against mortgages which will be their security. For the conven- fence of the small investor these fed eral farm loan bonds will be issued in denominations of $25 and up and will be exempt from federal, state or local taxation.
 Another purpose of conducting the hearing here yesterday afternoon was to establish the boundaries for the IWeiNe HcSc beiilhS will, of course, be established in com munities where they are the most needed. On the testimony offered by Arizona farmers Saturday afternoon, 1t is believed that Phoenix has an excel lent chance of being awarded one of the federal institutions.
 The process of securing a loan from one of the federal banks will be ex ceedingly simple. it was announced. The general belief was that in procur- ing a loan under this act the farmer would be forced to go through long tedious process
 Commissioner Norris referred to the high rates of interest that farmers are now obliged to pay on loans in certain sections. The object of this farm loan act, he said, was to give the farmers chance to develop their property at a reasonable rate of interest.
 He explained the formation of the numerous local loan associations, which must consist of at least ten members but may be as large as is desired. No territorial limits are plaSed upon these associations with the single exception that their boundaries shall lie entirely within the region served by one or the twelve regional banks.
 Each local farm association must elect a board of directors and choose a secretary treasurer and loan com mittee of three members. The ten or more men composing the loan board must desire to borrow at least S2O.OOO when the board is formed and can take in other members as desired. The ap- plication for a loan is first passed upon, without expense to the applicant. by the local loan board, none of whom can be interested in the loan. It is then forwarded to the bank and an of ficial appraiser sent to verify the re- port of the board. This appraisal be- ing approved, the borrower receives his money without delay.
 The limit of the loan. it was stated. will be fifty per cent of the value of the lands. plus twenty per cent of the value of the insured permanent inn provements.
 Speculation is discouraged by the fact that loans will be made only to farmers actually cultivating the lands on which the loan is made, and fur ther by the fact that no borrower can secure more than $10,000 in any one loan.
 After the very clear and lucid pres