Imperial Valley press., 1922-07-17
S487,500 Sc 7
AS SELLING
COST
Irrigation District Plan
Now Figures AS Deal
At Below Par
w ILL BUY S1,O0O,0OO
Mutual Companies and
Board in Session on Offer
BY Banks

Directors of the Imperial Irrigation
District and representatives of the
mutual water companies are today con
sidering whether it is necessary or de
sirable to pay banking interests and
bond houses $4S7 800 to sell a six per-
cent bond to the public. The prOpos-
ition promised when the bonds were
offered for sale on July II, as develop
ed this morning, involved exactly this
tidy sum which will some time or other
come out of the pockets of the taxpay-
ers of this county, if the proposition is
finally accepted.
Roll call when the meeting was
called to order this morning showed all
companies in the valley with the ex-
ception of Imperial Water Co. No.
and South Alamo represented by from
one to five directors. Eastside was rep
resented bv its entire board
McPherrin Presents Proposition
President McPherrin of the irriga
ton district board gave u summary Of
the proposition presented to the meet
ing in Los Angeles between directors
of the district and representatives of
the financial bloc which has offered to
undertake TO market the $7,500,0C0 in
ty on June l. Mr.. McPherrin stated
the matter impartially, outlining the
representations made by the financial
interests, detailing the difficulties
which they find in the way and making
mention of the phases of the matter
which are claimed to lend a hopeful as
pect to the situation.
He said in conclusion that district of
fieials were now presenting the pfopOs-
ition to the water companies and it was
for the meeting to consider what it
might be wise to do under the circum-
stances.
Mr.. McPherrin was followed by j.
w. Harrison of the Anglo London and
Paris Company ,one of the parties to
the syndicate, who elaborated some
what more fully upon the explanation
made by Mr.. McPherrin. Mr. Harrison
admitted that fear or pre- judice in the
minds of the bond consuming public
with reference to irrigation district Sc
curities was more of n superstition than
anything else and yet, he maintained,
that it. is something which must be
dealt with. He presented the formal
proposition of the syndicate to which
he said there is to be added q clause
agreeing to give the district refund
of all sums received from the bonds in
excess of par.
Interest Exceeds Six Percent
This proposition places the bonds on
basis of 6.55 percent interest for the
whole period. Should a premium be
obtained for the bonds, for example of
] percent, that parcel of bonds would
net the district 945 instead of 935
Any part of the issue which NAV be
taken by the public at as high a figure
as 1868 would net the district par and
if the imagination in it's flight could
take in a figure of 40, the district
would be that much richer.
The only bonds of which there is an
actual sale, however, are $1,000,O00
p worth and they are to bring 93.5 sub
ject to credits which may accrue to the
district on resale. The limit of the
commitments of the syndicate is
$l,O00,000 with an option on the other
$65O0,000 and if the public does not
absorb the latter sum the district is
simply out of luck.
All of this was frankly brought ont
by Mr.. Harrison who also emphasized
the advantages. that would accrue
should $7,5OO,000 in real money! find
its way into the valley and be turned
over and over in financing the hundred
and one things which need to be done.
Objects TO Mutuals Taking S5,OOO,OO0
ID. +. HARRISON suggested that the
syndicate might extend its commit,
ment to purchase $2,500,000 of the
bonds to be expended for purposes of
drainage and the people of the valley
themselves would take care of the $5,-
900 O,OO0ffor consolidation purposes. Mr..
Harrison agreed that this might be
done sbut objected that the $5,0oo,000 or
a considerable part thereof, would i'm
mediately be thrown on the market to
again demoralize sale of irrigation dis
trict securities.
vt was not made clear why the same
$6,000,0O0 if sold through the agencies
of the syndicate, might not likewise
~ find their way into the market for re-
sale.
In his reply to Mr.. HARRISON, Mr.
Harrison again emphasized the desira
bility of having the "entire $7,500,O0C