The Rathdrum tribune. (Rathdrum, Idaho) 1903-1963, 1916-03-17

has formulated a plan FOR making |
state loans, collecting interest and /,
principal thereon, and selling state
lands, which he believes will mater.
Tally Affect taxation, reduce interest !,
rates, enhance the states endowment
funds, simplify the method of doing
business and reduce the cost. His
plan Is submitted at this time, as it |
will require legislative action, and he
desires full and free discussion OF his |
suggestions before the legislature
meets, says the Statesman.
Idaho has over two and one half
million dollars invested 10 farm mort
cages, bearing 6 and per cent inter
est, payable seml-annual!Y. It has
about the same amount invested in
school bonds at the same interest rate,
and about five. .million dollars IN land
sale contracts bearing 6 per cent in
terest, payable annually. In other
words. the state is getting about 6
per cent interest on over ten million
dollars from the sale of its permanent
endowment fund lands.
The state has still for sale approx
/ matelY three million acres OF endow-
ment fund lands, about seven hun.
dred thousand acres of which are
covered with merchantable timber.
1t is estimated that when all this
land and timber are sold the state
should have upwards of one hundred
| million dollars to invest 10 farm loans
and school bonds.
Th vast sum of money. IL secured
and used for public benefit, as it ac-
cumulates, will control and lower the
interest rates charged in the state. in
the opinion OF Mr.. Eagleson. In any
event, he states, present interest
rates must be reduced from time to
time TO meet commercial rates. Why
not reduce them now, he asks, 10
order to get other possible benefits?
The recent extension of time for
the payment Of state land purchases
, from is to 40 years has greatly stimu.
lated their sale.
Mr.. Eagleson recommends the sale
OF state lands on per cent basis;
that is, per cent interest and per
cent amortization of principal.
BY placing ali school bonds. sale
contracts and mortgages on a 6 per
cent senii-aunual payment basis, 5
per cent TO apply as interest and the
balance on the amortization OF the
/ principal, the state would actually
save money. This would put all land
sales, loans and school bonds on a
36 year basis. The purchaser of land
or hOrro Her OF state money would
dispose of his entire debt in SO years
The annual payments would be SO
light that he could we'll afford to
meet them.
The treasurer takes for Illustration
note for $1,000, dated January !,
1917, at 6 per cent interest and amor
tization, payable semi-annually,
which would be $40 every six months
at the rate now charged. Instead OF
counting all of the $50 as interest
each time, the state would, under the
amortization plan, take per cent
semi-annually, and apply the balance
of the payment to amortlzating the
principal, thus reducing the principal
each payment and also the amount OF
int rest paid, hut increasing the
amount 10 apply on the principal.
Thus the interest on $1,000 at s pei
cent for six months would he $25,
which would permit So to apply on
the principal. This would leave 1895
on which to figure interest for The
next six months at per cent, 0I
$24 SO, and S5.!2 to apply on the
principal. For the third period OF
six mouths there would be $989 88 on
. which to figure interest, or $24 Is,
and S. % 10 apply on the principal
For the fourth period OF six months
/, there would remain $9S4,6 to figure
interest on at Ier cent for 81,
months, or $24 SO, with So 38 to ap
ply on the principal, and SO on for 81