The Birmingham age-herald., 1918-01-18
MCDONALD CASES ARE AFF|RMEDBY
 SUPREME COURT City Has No Authority to Use Sinking Fund to Pay Interest, Is Ruling PUBLIC UTILITY BOND ISSUE IS HELD VALID City Attorney M. M. Ullman Makes Statement as to Effect of De-
 cision on the City of
 Birmingham

Montgomery, January f.-tSpeciat) The municipality of Birmingham fe- ceived a body blow from the supreme court of Alabama Thursday when 1t heid in the famous McDonald suits that the city commission had no authority to use the special interest and sinking funo tax authorized by the constitution ol 1901 in paying interest on bond issues totaling S3OO0,00o, which were autnorlaeo by the voters June 3, 1916, for the pur- chase of public school property, the con- struction of city auditorium and the purchase or acquisition of an electric light and power plant.
 Every penny of the special tax Of IF of 1 per cent authorized by section 2l6 of the constitution of 1901 must be used in paying interest on bonds issued prior to the adoption of the constitution, in the creation of a sinking fund for the ultimate retiremet of the bond issues and for the payment of interest on any bond issues at that time authorized but not placed on the market-and the supreme court in reaching this decision held that the constitution in recognizing as legal the payment of interest from this special fund on issues already authorized by law meant a bond issue of s1,0oO,0oO which had been authorized for the construction of an electric plant prior to the adoption of the constitution.
 RULED WITH CITY
 In the companion suit, the supreme court ruled with the city commission of Birmingham that it had authority to use portion of the bond issue in the pur- chase or acquisition of an electric light and power plant
 In both instances, the supreme court upheld decisions of the Birmingham city court and the net result is that the city commission of Birmingham now has authority to issue bonds to the amount of S2, GOO for the purchase of school property, of $50o,000 for the construction or purchase of city auditorium and of s5O0C00 for the requirement of an electric light and power plant, but it can use no portion of the special interest and sink ing fund of 11s per cent, authorized by section 216 of the constitution. in paying the interest on the issues.
 MCDONALD CONVENTIONS
 T. c. Mcdonald, tax payer of Bir- n1ingham and former member of the state house of representatives from Jeff ferson county, brought the suits soon after the voters had authorized the bond issues He contended that the city com mission was about to disregard the pro- vision of section 216 of the constitution and to issue the bonds with the idea of meeting the interest from the special tax when the constitutional section ex- pressly provided that the special tax was to be used in meeting interest on bonds issued prior to the adoption of the con stitution or authorized at that time and in the creation of a sinking fund for the intimate payment of the bond issues. He asked the court for an injunction preventing the issuance of the bonds un- til some other arrangement had been made for the payment of interest
 SPECIAL INTEREST FUND
 The Birmingham city court refused to grant an injunction preventing the is- suance of the bonds, but did hold that the special interest fund could not bo used, and granted Mcdonald an injunc- tion preventing the use of any portion of the special fund in paying interest. As the city had contemplated the use of the special fund in paying interest and had not other plan in mind, the sale of the bonds was stopped pending final decision.
 In another case McDonald sought an injunction preventing the issuance of bonds to the amout of $500,0o0 for the acquisition of an electric light and power plant He admitted that the law per mitted the issuance of bonds for elec- tric lighting plant, but maintained that an electric power plant could not come within the meaning of the law. The Birmingham city court denied the re- quest for an injunction, holding that an electric lighting plant and an electric power plant were one and the same thing, and that an electric power plant was necessary before electric lights could be produced. The supreme court upheld the decision of the lower court
 Justice Gardner wrote the opinions in the two cases. In the case involving the use of the special fund, the opinion was concurred in by Chief Justice Ander- son and Justices Mcclellan and Somer- vile. In the power plant case, the opin- ion was concurred in by Chief Justice