Great Falls daily tribune. [volume] (Great Falls, Mont.) 1895-1921, 1921-01-05

Der o5l were delinquent.
THE total interest received ON
these loans for the two years ending
November 80, 1920, amounts to the
sum of $231, 320,82, while the amount
of interest delinquent was estimated
at $12o,381.15, or the equivalent of
1871 per cent.
During the year ending November
80, 1920, there was invested in farm
loans $1,056,60 as against only $780,
600 in school district bonds, although,
during the same period there were
offered and denied rs applications
for the purchase of school district
bonds aggregating $3,438,0o0.
"The farm loan expense for the
year was $28,S46.67, all Of which was
paid out of the common school fund,
which is permanently depleted to that
amount. The register estimates that
20 per cent of this expense was for
work in connection with rejected APP
plications for loans"
This is mighty serious condition
of affairs. The school funds of the
state have always been considered a
sacred heritage we hold in trust for
the children of our posterity to be
handed down to. them intact. Gov.
Dixon informs US that nearly thirty
thousand dollars of these funds have
been used up and spent in investiga-
ton of farm loan applications, a
good many of which were rejected
because the security was insufficient.
That money should be put back in
the school fund at once, and the law
SO changed that our permanent school
fund can no longer be depleted in
that manner. 1t appears that the
present law puts all the expense of
investigating applications for farm
loans on the state, and the state has
been paying these expenses out Of
our permanent school funds. Gov.
Dixon says this should stop and the
expense be charged to the applicant
for the loan. We greet that recon-
mendation with loud amen. But
that is not all of the governors rev.
Citations on this subject. 1t appears
nearly third of the farm loans made
out of the permanent school funds
of the state are delinquent. The in
terest is not paid on them. These
delinquent loans number 651 out of
total of 1928 loans, and the interest
due and unpaid on the 65l loans rep
resenting about a million and a third
in principal is some S12o, 381.15. Nor
is the whole story told yet. Gov.
Dixon informs US that in many cases
not only is the interest delinquent
on these loans, but the taxes are de-
linquent also and in order to protect
our security more money must be
advanced to pay these taxes with.
From other sources than the gov
ernor's message The Tribune is in
formed that in a considerable num-
Der of these delinquent farm loans
made out of the permanent school
funds the parties who have borrowed
the money have abandoned their
farms and left the country leaving |
the state to hold the sack, and that |
in some of them it is shrewdly sus-
pected that the state authorities who |
are responsible for making the loans
were deceived as to the true value of |
the property and loaned too much
money on the land SO that it appears |
likely that it will involve loss when /
the mortgage is foseclosed.
These farm loans bear only six per |
cent interest. They, furnish cheap
money to farmers, cheaper than any
business man can get it, no matter
how good his credit. The Anaconda
Copper Company with no debt and
refined copper on hand almost to the
value Of their bond issue had to pay
eight per cent on an eight-year loan
the other day secured by first mort
gage on all their property. We are
lending the school money of the state
to farmers at six per cent, and we
certainly ought to get absolute Sc
curity for loans made at that price.
We can get six per cent now by in
vesting our school money in United
States government bonds.
Gov. Dixon is entitled to credit for
bringing this matter boldly to the
attention of the legislature. 1t is not
a pleasant task. Evidently the gov--
ernor feels this, because he prefaces
his statement with the remark that
he would be remiss in his duty" if
he did not do it. That is SO. 1t will
not be pleasant task for the legis!a-
ture to rectify the matter either, but
they will be "remiss in their duty"iif
they do not. We cannot afford to
waste the inheritance of the school
children of the future by making bad
e Il Al