The daily morning oasis., 1919-11-22
City Sinking Fund
Continued from page one)

S55,OOO that Is offered by the Build
ing and Lean Association is not, how
ever, the happiest feature involved.
The chief and everlasting benefit
through the handling Of these de-
posts by the Association would be
the creation of thirty to forty addi-
tional new homes running up to con-
siderable value. Should the city see
fit to deposit the money with the
Association the city within one year
after the first deposit would begin
to derive taxes on property repre-
senting that very money, and so on
increasingly afd indefinitely. I can
not conceive of a better, safer, or
more profitable method of paying off
the bonded debt Placing the sink
ing fund money in the bank does not
run it to the erection of any homes.
The article you published stated that
some of the Aldermen thought that
the investment of the funds with the
Association might tie up the money
so the city could not have it when
needed. The time when the money
will be needed is when the bonds be-
come due, and if the money is de-
posted with the Association and left
there as outlined, the entire $4,000
will be ready for the bonds at least
six months before they become pay
able. Moreover, the Association would
then be also able to point where the
handling of the money had resulted
in a large addition of property to the
assessment roll. However, should the
city at any time become dissatisfied
with the Association as a depository
the city could have it's money back
with accrued interest. The Associa-
ton does not guarantee the payment
of any fixed rate of interest, there
fore, the mention of 10 per cent per
annum in your article of the 10Th
was unauthorized. The interest divi-
dends of the Association are based
on the annual earnings, and with
twenty years of successful experience
the Association has a rather reliable
basis for calculating upon the future
with a fair degree of accuracy, and
this is why it is in a position to ex-
hibit to the Council the probable re-
suits in the handling of money. Am
confident that the money with the
Association would do far better than
stated for my propositions are fig
ured on the remote possibility Of adj
verse conditions. 1t is not unlawful
for the city to deposit the money
with the Association. AS good legal
advice as there is in Nogales can so
tell the Council. The Council can
find no law directing it to place the
money in the First National Bank, or
in any other bank. The selection of
the depository lies in the discretion of
the Council. At any rate the Council
could deposit the money with the As
ISOLATION and should there be any
successful exception to the action the
money could be handed back to-
gether with whatever interest &C
crued. There would be no resulting
harm or penalty. Besides this sink
ing fund money there is also another
item in connection with the bonds. In
terest to the extent of $500 is being
paid annually. This is something
that cannot be evaded, sidestepped or
postponed, however, the Building and
Loan Association is in a position to
direct the Council to a means of eff
fecting a saving on this tax of an
amount equal to the sum of seven
years. interest and still permit the
city to decrease it's financial efforts
relating to the present bonded indebt-
edness. The opportunity to realize
saving to the city of at least $780,
coo and in so doing to largely in
crease the number of dwellings in
Nogales, is not a matter that should
be lightly shunted aside. The sub
ject is really worthy of preferred and
serious attention by the Council.