The herald and news. [volume] (Newberry S.C.) 1903-1937, 1917-01-23
REFUNDING or
THE STATE DEBT

Columbia, Jan. 20.-In his annual
report to the comptroller general, to
be by him trasmitted to the general
assembly, State Treasurer S. T. Car
ter will call attention to the refund
ing Of the State debt, and to the say
ing effected thereby. His estimate is
"a total saving each year of from $780,
600 tC 100000
In regard to the refund;n2 of the
debt and the sale of the bonds, the
State treasurer will say in his report:
The general assembly at its 1912
session passed an act providing for
the State to exercise its option to re-
fund the 4 l-2 per cent redemption OF
Brown Consols d, bI. The money mar
ket was such that only one time dur
ing the previous four years could the
! 4 per cent refunding bonds have bee.l
sold. Had the issue been disposed OF
at that time the saving in interest and
taxes to this year would have amount
ed tc more than a quarter OF a million
dollars. When the money market in
1915 afforded an opportunity to dis
pose OF the bonds it was promptly
taken advantage of. The bonds were
/ placed upon the market in February
and had the date of sale been delay
ed thirty days they could not have
been disposed of at anything like the
price realized, and probably could not
have been sold at par.
"The refunding bonds, amounting to
S4,731, ,72O, were sold on February IT,
1916, to syndicate headed by Massrs.
Stacy and Braun, of Toledo Ohio, and
New York city. The amount paid was
par and accrued interest to February
Is, and premium Of All per cent, or
, sl9,731.27. The bonds were to be de-
itVered as soon as they could be pre-
pared and executed, but by agreement
| between the sinking fund commission
and the purchasers the date of deliy
cry was fixed for April 1st. the pur-
chasers agreeing to pay additional in
terest for the time that would elapse
/ between the date the bonds could have
been delivered and April 1st. The ad-
dltlonal interest amounted to $3,927.-
%. BY this arrangement the State
was able to arrange and advertise for
the call and redemption OF The 4 -
per cent bonds for April 1st, thus en-
abllng the two transactions to be
handled simultaneously, thereby
avoiding overlapping interest of the
two issues.
''The clerical work entailed upon
this office in preparing for issuing the
new bonds and redeeming the old is.
sue was enormous, and the clerks in
the department are to be commended
for the prompt and efficient manner
IN which they handled, the transac-
tions. Their work attracted attention
and favorable comment of bond deal
ers in other States. 1t has hereto
lore been necessary to employ addi-
tlonal help in similar transactions.
but in this instance the regular Office
force did the work. and there was no,
hitch and no additional expense was
incurred.
The sale of the per cent refund
ing bonds and redemption of the re.
demption Brown Consols bonds has
resulted in large annual saving to
the State. After paying accrued in
terest on the 4. 1-2 per cent bonds,
: We are covering into the treasury
s7,S2966 of the interest appropriated
in 1916, and we have on hand s19.-
1927 received from premium on the
refunding bonds. The difference in
interest resulting from the reduction
OF the rate and retiring a part Of the
principal of the State debt will be
$63.754.76 annually. The refundins
bonds have not the "tax deduction"
feature, as did the Brown bonds, and
this will add to the taxable property
annroximately one and a half million
dollars. which will increase revenue
for all purposes about $4,000 annual
. ly, making a total saving each year
of from $4,000 to 100000.
"The sale of this issue was handled
by the officers charged with that duty
and it was not necessary to call on
brokers or others for assistance iu
selling the bonds No commission in
any form was paid to anyone and no.
a penny Of the $4,000 allowed by the
bond act of 1912, for commission, was
used''