Evening capital and Maryland gazette. (Annapolis, Md.) 1910-1922, 1920-10-25
Mr.. &. II. Clements GIyes His Figures
And Views ADout SeslooI BoRd
Very frlils years
JAMES a. NATION

4Hu VIEWS Auuut ssSa1VVA A*SxsW
hin.
To the Editor III he Evening Capital
have been asked 80 frequently ot
late 10 make computations concerning
yari1ns features of the proposed
School bond ssuc or to check the
computation OF others, that would
like space in your paper 70 answer
publicly some of these questions, and
to make some comments on features
oil the loan
The sinking fund provisions are
not accurately drawn Payments Of
SIS 900 at the end % each year, aeenm-
uIated with interest at 4 per cent pay
able annually Will amount 9 $4,000
in about % years and 70 Sl6S,254Sl
lin so years "a ANIMAL payment ct
$685. into the sinking fund would
have been sufficient THE amour Of
~ assumes that the payment Of So
900 il made In full at the beginning OF
sire. 22s III vous caitoriaI of October
each year, and that interest Is added
al the rate OF ? per cent each sin
months Under such terms it would
Of course, take less than Is wears 70
accumulate Sl5O0Oo, or require less
than s2.675 yearls Tor the sinking
fund
2. The claim that the money Will
cost us only 3 IA per cent IL based
on an obvious fallacv That state
ment is true only OH The assumption
that no interest be paid until the end
Of the 80 years, when il shall all be
paid in lump sum without cam-
pounding and money isn't being
loaned that way Payments 81 $40,
500 at he end of each year for &c
years are sufficient to pay on j DEBT o.
$4,000 With interest III 223 per
cent Therefore. This money would
actually cost lis : 20 per cent per
year. assuming that the bonds could
be sold at par
8 Il 1a-gear bond issue. retired
seriaiiy, would seem to be a much bet
ter proposition for the taxpayer If
We assume that the bonds would he is
sued in 500 pieces SO that they might
be gSAierallg purchased by friends Of
he $&h0@ls (which means all Of us1.
then bysa series Of Is payments thc
largs# Of which would be Sl4.500 tins
honelss could be retired serially in f.
years at 4 total cost Of s216.635 fhe
fotal cost on the proposed issue VIII
be $3l5,960 a difference Of s9S.3GS.
Thus an average increaseeol lsss than
$4,000 over IKE present CARRYING
charges of Sf050q during each of the
first / 4 wears would make entirely IN.
necessary any payments at al during
Tie lass Is years; amt IS Years would
seem more desirable life for the
bonds Than 80 years for sother rea-
sons
y il il hard work paying FOR &
dead horse particularly ii you need
the money 3 buy live one. A funda-
mental requirement for the soundness
Of bond issues Of the sort proposed is
thar the period of the bonds shall BE-
somewhat less than THE average life OF
the things for which the proceeds os
the sale are 10 be expended Because
Of the high cost Of building at the
present time. and Of the many admit
ted needs this money would have to
be spent largely for frame structures
and there would be imperative need
for further extensions and replace
ments long before the end Of the 30
year period We are making ii diRi-
cult TO provide for these needs that
arc sure to arise I'm the future, Ii ia
the nineteen forties we must still he
paying for then obsolete structures
built ii 1921
5. There Is little doubt lat i bond
issue for school bildinss could he
ratified by i large majority Tho oh
lection Is 10 this particular scheme
Rejection Of this particular loan does
rot mean Rejection OF improvement TT
our school property Il means that
We feel NE must POSTPONE expendi-
lures on 50 large scale until the
next Legislature shall have authorized
bonds more TO our liking In tfe
We csn have i careful sur
vey made of our needs and have i we'll
thought out plan OF action ready al
hand when the funds shall Re made
available. thus involving after All oaly
a moderate delay in making the ad-
mittelly much needed improvements
And we max reasonably hope by this
slight DELAY 70 gain both boster terms.
for the loan and better terms on the
building contracts.
G. r. CLEMENTS.
Murray avenue
Annapolis Md.