Crossville chronicle. [volume] (Crossville, Tenn.) 1894-current, 1921-10-12
CITY BONDS MAY SELL;
OPTION GIVEN TO OCT. 20
Par to Be Bid With an Expense Ac-
eount That Makes Selling Price
Areund Ninty Cents.

Atthe meeting of the Board of May
or and Aldermen, Friday night. Z. n.
Little representing |. B. Tigrett and
Company, Memphis and Jackson, was
present and made an offer for the
$4,000 of school bonds authorized by
the voters of the corpoation some
months ago for the erection OF a pun
lie school building.
Repeated efforts have been made
to dispose of the bonds but in no IN
stance has par offer been received.
In this case it is understood that a
par bid will be made and that $500
will be allowed as an attorneys tee
for passing on the validity of the
bonds and $500 for furnishing the
bonds. That will virtually mean a
reduction of the actual cost OF the
bonds of $4,000, which would bring the
net price to the city down to 90 cents
or "a total of $4,000
While the law specifically states
that the bonds shall not sell for less
than par, the supreme court has IN
several instances ruled that the ex-
pense feature was within the provi-
sions of the law and makes the sale
legal.
1t was understood, and SO stated in
the city court records, that in case
the bonds are purchased by the comp
any represented by Mr.. Little that
Mr.. Little's company will pay the
cost of the attorneys fee for passing
and rendering opinion on the valid
ity of the bond issue. In case Mr..
s,ie's company does not become the
purchasers of the bonds, the cost
of the opinion as to validity of assure
shall not exceed SIS to the city.
1t was realized that before the
bonds could be sold an opinion would
have to be secured from some well
known bond attorneys and that the
SIS paid for that service was not ex-
cessive.
1t is very unpleasant to think that
our town must lose ten percent on
bonds issued for the erection of a
public school building, but the bond
market has been such ever since the
bonds were authorized that sale at
par was impossible. This condition
is due almost entirely to the fact
that so many government bonds is
sued for war purposes can be bought
below par and at such reduction as
makes Crossvile city bonds not read
lily saleable in spite Of the fact that
they bear interest at six percent and
government bonds bear only five and
a half. One can readily see how gov
ernment bonds at that slight differ
ence on interest should be more
sought after than Crossville city bond.
Conditions have been such that war
bonds have been purchased at as low
as 80 cents on the dollar. At this
time they are considerable higher
and are constantly advancing, but the
point has not yet been reached when
they are not more desirable than
our city bonds.
Some may be inclined to censure
the city fathers for selling the bonds
at this season of the year as it will
be impossible to use the money for
a few months, yet they would be draw
ing interest. Cashier ]. S. Reed was
present and proffered on the part Of
the bank to take care of the interest
for four months, provided the funds
were deposited in the First national
Bank, Crossville.
The option given was to expire
October FL. 1t was further agreed
that should any person desire the
bonds at a higher compensation, the
city would be at liberty to sell them
to any other person at the higher
rate. The only condition being that
the city shoul not go into the market
seeking buyer until after the option