El Nuevo mexicano., 1918-03-21
ALLEGATIONS MADE IN
REPORT TO THE GOVERNOR

All of the following is 9 statement
and summary of the report by Mr..
James. The statement and its pub
LEGATION were approved by the govern
or and Mr.. James; and allegations
which follow are published as being
allegations in the report
A. e. James, director of the tax
paysrs' association, has filed with
the governor his report On the issue
OF state bonds of Series G. The re-
portaissa lengthy one and goes fully
into the history Of the railroad debts
of Grant and Santa Fe counties
which the state assumed and refund
ed.
Santa Re county in 1880 and 1887
and Grant county in 1888 issued
bonds in aid of railroad construction.
Although held valid in the state
courts these bonds were held in
valid by the U. s. supreme court
and Santa Fe county refused to pay
either principal or interest on the
two issues of $150,O00 each which
it had made. In 1897 congress val.
idated the bonds Of 1883 of Grant
county and bond issues of Santa Fe
county of 1891 and 1892 which re-
funded the original county railroad
debt.
Santa Fe county continued to de-
fault in its interest not only on the
railroad bonds but on all others and
the debt grew as the interest piled
up. Interest accumulated on the de-
faulted interest and it became ap-
parent that the county never could
hope to pay out without oppressive
taxation.
Under these circumstances con.
gress granted the state in the enab-
ling act one million acres of land
upon condition that the state assume
and pay the railroad debt of Grant
and Santa Fe counties and provided
that any balance remaining from the
proceeds of these lands after paying
these debts should go to the common
school permanent fund and congress
also stipulated that only debts valid
and subsisting'' on June 20, . 1910,
should be paid by the state and re-
served the right to see that the
trust was properly administered.
The state legislature in 1912 Gre
ated a state loan commission con-
sisting Of the auditor, treasurer and
attorney general charged with the
duty to ascertain the railroad debt
of Grant and Santa Fe counties and
to refund this debt and the accrued
and unpaid interest with new bonds
known as bonds of Series G these
and the interest thereon to be paid
from the proceeds of the million
acres of land granted to the state.
The report goes at length into
each transaction of the loan commits
sion involving either the issue of
bonds or the payment of money TO
persons claiming to own the old
Santa Fe county Indebtedness. The
Grant county indebtedness was not
refunded but the state paid the in
terest on it to Grant county.
The examination discloses that the
loan board recognized and paid inter
est on the delinquent Santa Fe coi-
pons representing interest on the
railroad bonds in an amount which
cannot be ascertained to the cent but
which is in excess OF 1886, 313.79.
This was correct in principle but the
were allowed to carry such in
terest at 6 per cent in some cases
for four years after the state was
ready and able to pay the princi-
pal and the only fault lay with the
claimants in not presenting the
promptly. This excessive al
lowance OF interest on interest alone
amounts to $2532s32.
A large number Of coupons from
OF Santa Fe county were on
June 20, 1910, barred by the statute
Of limitations and as the holders Of
the coupons which were not barred
collected their full legal claim includ-