Omaha daily bee., 1920-01-30
Municipal Financing
From the Daily Bond Buyer.

Financing the permanent improvements OF
American states, counties, cities and smaller
sorbed about $3.50 100000 of the funds of Ameri-
Gan investors. This is larger amount by. over
$25000o,000 than the total borrowings Of this
character in any previous year and is in re-
markabe comparison with the total for 1918,
viz: $262,Sl8,844. However, a study of the
esting fact that the amount borrowed by states
and municipalities in the two years 1918 and
1919 was little in excess of the borrowing in
1916 and 1917, or in 1915 and 1916. In other
words, the tremendous volume of public
financing effected during the year just closed
about in 1918, through the agency of the Capital
Issues Committee, as a war measure.
In 1918, it will be recalled, no state, county
or town could issue securities for the purpose
Of building road or bridge or school without
obtaining the consent Of the Capital Issues
necessary to convince the Committee of the
urgent necessity of the improvement The re-
suit was, Of course, an immediate curtalment
OF public construction activities and incident
ally, a vast reduction in the volume of public
bond issues. The Capital Issues Committee
suspended operations on December 81, 1918, in
view of the signing of the armistice. Immedi-
ately states and municipalities took up their
greatly delayed public works programs, nvolv-
ing. the issuance Of millions Of dollars worth
of bonds.
When everything is considered it Is surpris-
ing that the past year has not witnessed even
greater expenditures for work of this kind. Un-
doubtedly the scarcity of labor, materials and
transportation is the only reason why another
three or four hundred millions were not OBJ
tanned through the sale of bonds and invested
in city halls and electric light and power
plants. There was certainly no limit in 1918 to
the amount of municipal bonds the investment
markets would have absorbed and it is clear
from the records that only aSsmall part of the
bonds authorized by voters and legislatures
have actually been offered for sale. The total
borrowings, $748,20s,783, while larger than
those OF any previous year, do not represent
the amount of Improvements that this sum
would have purchased few years ago, which
is a fact of some importance when considering
the tendency of municipalities to increase the
volume of bond issuance.
An outstanding feature of present day mt
nicpal finance is the good roads movement
which has swept the country in the last few
years and has been taken up by the public with
the greatest energy and enthusiasm since the
war; due, no doubt, to the wartime demonstra-
ton of the economy, efficiency and profitable
ness of shipping by motor truck over good
roads. The construction of new highways ac-
counts for substantial part of the financing of
the counties in 1919 and will in coming years
keep the market supplied with millions of dol
lars worth of bonds, the proceeds of the sale
of which will pay for additional roads and their
upkeep.
With some reports missing for the last few
months of 1919, here is the record of state and
municipal bond hotations for the last ten years,
as compiled from reports to The Daily Bond