The Birmingham age-herald., 1921-07-07
COMMITTEES REPORT

supreme court held this to rbe an evasion of the law and would not permit the payment of the commits sion, resulting in loss of s50,000 to the road contractors who had paid the cash into the county treasury. The law that time limited the interest rate on county obligations to per cent and did not permit the sale of bonds below par and accrued interest.
 The county then found itself in a most embarrassing position. It had let contracts for about S2,000, 900 or road work expecting to make pay ment out of the proceeds of the bond sale and great part of the work had been started and was in various stages of progress. To abandon the work would mean the loss of several hundred thousand dollars of federal aid money already allocated to the county; 1t would mean the payment of damages to contractors for breach or contract; it would mean that a great part of the work already done would become value1ess by reason o. completion. 1t would mean a se- rious blot on the county's integrity.
 The only way out was to issue interest bearing warrants to con tractors in payment for their esti- mates as they became due. which the contractors could convert into cash. These warrants bore per cent inter- est. and they found ready market with investors. The board of revenue fully realized that this was entirely too high rate of interest to pay. but they elected to proceed in this manner rather than accept the only other alternative.
 At the special session of the legis lature held in 1920, bill was passed authorizing counties to pay up to ' per cent for money. Jefferson coun- ty at once undertook to sell bonds under this act but the supreme court troactive--it only applied to bonds voted since the passage of the act.
 Charge of Conspiracy
 ''The board then asked for bids for a large amount of road work to be paid for in bonds at par. Inasmuch as the bonds were only salable at a substantial discount. leading bond at- torneys advised bond houses that they entertained grave fear that anyone who purchased the bonds from the contractors, knowing that the con- tractor must have added the discount to his bid for the road work, would be in danger of being held to have participated in conspiracy to evade the law, and might be required to pay the discount into the county treasury.
 "On the rendering of this decision, the board of revenue announced that it would not let the jobs for which bids were to be submitted. and it is now considering the submission 10 the voters of new bond issue to bear a rate of interest that the present law your committee thinks the chamber your, committee things the chamber should offer its recommendations.
 Your committee suggests the fol- lowing:
 Recommendation
 "1. Jefferson county shou6 not ex- cept under most unusual circum- stances. contract indebtedness up to the maximum. We believe margin of $1.000.000 shoud always be main tained between outstanding debt and authorized debt, to be made use of only in the event an emergency should arise.
 "2. Good roads are of vital impor- tance and we will always advocate their construction. But the entire resources of the county should not be expended in any one direction. We consider new courthouse and jail ev be crying need. and believe that sum of about $750.0o0 should be pro- vided for this purpose in the next bond election.
 8. We believe both good roads and courthouse bonds would be passed fol- lowing careful campaign. Young men are almost a unit in favoring i'm provements, but just at this time. several thousand ef the younger vete