The commercial. (Union City, Tenn.) 190?-193?, 1919-11-07
The Sinking Fund.

over in some respects. When the first
bonds were issued by the city for the
water and light plant, in 1891,
clause was put in bonds and made
uart of the contract, that a sinking
fund was to be collected annually to
make certain payment OF the bonds
at their maturity. The fund provid-
ed at that time, and it has been kept
mn in all subsequent issues Of bonds,
was 10 cents on the 500 OF assessed
valuation, and it was provided IN
the law that this money should be
loaned out and kept intact and in
violate, except for the purposes Tor
which it was issued.
This fund was not preserved until
after the election for Mayor OF jan
uary /, 1896, when fund was &C
cumulated sufficient by January l,
1900. to cover the sinking fund on
theS So, 900 in bonds issued under that
act I'D to date. From various caus-
es, not necessary to mention here
that fund was neglected by the next
Mayor and by all subsequent Mayors
from that time until this, although
of course, the law has never been
changed and the contract is existing
between the city and all the bond
holders of the city, that this fund
shall be collected and preserved. 1t
could be used in the purchase ana
retiring of city bonds, or loaned out
at the discretion of the Board OF
Mayor and Aldermen, but 1T is just
as incumbent on any Board OF Mayor
and Aldermen to preserve that fund
| now as it ever was.
It is not certain what the result
| would be on city officials, should trou-
BILE ever arise in regard to this mat
ter. but those neglecting their duty
in particular could probably be held
responsible, individually, for their
neglect of duty.
| The writer is not inclined to let
the present opportunity pass to call
the attention of the next Mayor and
/ Aldermen to what he thinks is their
duty in taking care of the city n
nance and relieving it from the
large debt that has accumulated upon
it during the last several years, aside
from the regular bonded indebtedness
of the city. OF course when public
necessities arise the incentive is great
/ to borrow money and contract debts
to relieve present necessities, but
every informed person knows the ci-
ty has no right to contract debt
except for ordinary expenses OF city
government, unless it is done by per-
mission of the Legislature and an
election held and such issue author
lied by the voters of the town. There
has been a limit set, wisely, as to
how many bonds any municipality
can issue, and the only trouble that
appears to the writer in this particu-
lar is that the limit has been placed
too high.
The only way to get rid of debts Is
to pay them, and it is not right to
contract debts on the part of the city,
unless it is done legally and unless 1T
apr ears to be for temporary purpos-
es. 1t is not intended to make any re-
Election upon the present or any past
administration for any debts OF this
kind it might have created, for the
same has been done by administra-
tions that have gone before, and the
debts that the present administra-
ton finds itself bound for now, were
contracted largely probably by pre-
ceding administrations. They have
simply been carried along. Every
well regulated town or city now pro-
vides at the beginning of the year
budget setting out in detail what
money may be spent during the year
and setting bounds which are not to
be passed. At the same time an es-
, innate is made Of the income the
city may expect during the ensuing
year and the city of course is moi
allowed to spend beyond its income
. In cases like that confronting thu
, city at the present time, of course
, there ought to be a wide margin
left to pay existing debts that hav'
, been contracted and are the onl,
liabilities on the city resting on ths
honor of the Board Of Mayor and AL
. dermen in power when they come due
: These obligations are, without ex
, ception no doubt, secured by citizens
, of the town and the holders of then
. incur no risk whatever, as to theil
future payment nor would they incu
. any liability probably If there wa
' no security whatever. The cit.
| having gotten value received, no ad
, ministration would refuse to pay sucl
. debts, but emergencies could aris'
/ when there might be trouble IL Their,
= werc too great an amount of such OBJ