Belt Valley times. [volume] (Armington, Mont.) 1894-1977, 1923-04-12
THE ONLY SENSIBLE PLAN.
(From the Whitefish Pilot)

(From the Whitefish Pilot
The last year or so people who have come into possession of
warrants of the city of Whitefsh, and attempted to get face value
for them have in most cases been rudely disappointed. Practically
all warrants have been discounted and warrants on some funds are
not attractive even at a big discount. This situation has made
people who have dealings with the city charge more by far than
they would have had the warrants been on a cash basis. 1t is not
too much to say that under present conditions the city has, and
will continue to pay l5 to 20 per cent more than 1t should, due TO
the big discount on warrants.
The Union Trust Company of Spokane had a representative
here at . special council meeting last Monday evening, and will
have another representative here at the meeting next Monday
night. This company offered to buy the bonds to fund the out
standing warrants at 100 cents on the dollar at six per cent, the
same rate that the warrants bear. The market is favorable now,
due to the demand for investments at the beginning of the new
year. These bonds would be serial bonds, a part due annually for
10 years. payments to start at 10 years from date The money is
advanced to put the city funds on a cash basis, and after 10 years,
with more wealth, the city will begin to pay back on the annual IN
staHment plan. And in addition by funding these warrants, the
city will be on a cash basis and can secure the things it buys for
about 20 per cent less. The only substantial objection to the fund
ing of the warrants on the part of the councilmen is the fear that
when the various funds are all square that the city will feel pros
porous and proceed to spend money faster than it comes in from
the regular levies. The Pilot is quite sure that the present council
will not do that and it thinks the voters of Whitefish have horse
sense enough to not approve the election of anyone in the future
with ~spendthrift inclinations.
To the Pilot it seems the only sensible, businesslke thing to
do is for the council to accept this highly favorable offer on fund
ing bonds and put the city on a cash basis. And what is more, we
are sure that there is not a banker in Montana who would not give
the same advice. A business that was paying a premium of 20 per
cent on overdraft checks would soon find itself in a fine jackpot.
The same rule holds for a municipal corporation. The Pilot hopes
to see the council rise to the occasion.
This editorial was written for the Whitefsh Pilot by the edi-
tor last December and because of its peculiar fitness for the Belt
situation, it is reproduced here.
To state the matter briefly, Belt has q floating indebtedness
of $4,000 including accrued interest. The general fund is in the
red, the contingent fund likewise while the road fund was lost sight
of long ago, buried under a mass of warrants.
The city council can do nothing for a reasonable price. Who
wants to work on the streets when it may be several years before
the pay checks are as good as cash. Who can afford to discount
city warrants Is per cent and sell the city merchandise at a rea-
sonable profit. 1t can't be done.
Were the city warrants exchanged for bonds it would put the
city on a cash basis once more when would arise the temptation to
exceed the city's income in expenditures on streets and improve
ments. The Times does not believe that any of the council or coun-
cimen-elect would countenance such a proceeding. Neither will
the people of the city stand for it. i
Refund the warrants and then plan a budget for the fiscal
year which will not permit the cty's Indebtedness to be increased
one penny. We all pay taxes and it is to our interest to see that
the city's revenue shall cover every financial outlay.
If the money is not provided, we must do without and then
in about 10 years we may hope to get our ears above the flood of
debt.