The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1923-06-16
FINANCES OF
PUBLIC GO ON
CASH BASIS
North Dakota Counties, Cities.
Schools to Enter New
Period of Financing
REDUCE WARRANT EVIL
Issuance of Bonds and Certiii-
Gates of Indebtedness are
Provided For

A new period in financing OF
counties. cities. school districts and
other subdivisions of the state will
be inaugurated July l when house
bill No. 1923 of the 1923 legislature
becomes effective. Public finances
must be placed on a cash basis.
"The question has been asked
whether taxing districts are obliged
to bond or to issue certificates of
indebtedness after July I, 1928"
says Tax Commissioner c. c. Con
verse in an exhaustive statement on
the new law. "The answer is that
one of the provisions of the law
which is compulsory is that public
affairs shall be placed upon cash
basis in some way, so that warrants
shall not be issued unless there is
cash in the hands of the treasurer
of the district to meet the warrants
upon presentation"
Answering the question. must
bonds be issued, the tax commission
er says: .. ...
"The issuance of bonds is not
compulsory if, without the issuance
of bonds, a way can be contrived to
arrive at the result aimed at in the
statute, namely the placing Of the
affairs of the taxing district upon
cash basis. The provision Of the
law regarding the issuance of bonds
was made necessary by the fact that
some taxing districts had issued
warrants in excess of taxes levied
They are not permitted to issue
certificates Of indebtedness in ex
cess of taxes levied and therefore
provision was necessary to per
nit them to bond to take care OF
the excess of outstanding indebted
ness over taxes levied. 1t is moi
necessary for district to bond un
| less it's outstanding indebtedness il
in excess of uncollected taxes. Take:
| of 1922 must not be included in thi:
computation, for collections Of 1872.
taxes are depended upon to supply
| the cash necessary so that the dis
trict may continue to operate"
Depends on Situation
Many of the financial actions t'
be taken depend upon the status OF
the individual district.
Suppose a taxing district has
outstanding warrants, but also has
outstanding taxes of an equal or
greater amount" says Mr.. Con
verse. 1T is clear that it will bt
required to issue certificates of in
debtedness, but for what amount
Must it Immediately retire all out
standing warrants? No, it may dc
so but is not required to unles'
that course is preferred by th'
board.
"The board may choose either o.
two courses 1t smay sell enough
certificates of Indebtedness to re
tire all outstanding warrants an'
provide q cash balance besides, or
on the other hand it may do nothing
in the direction Of retiring outstand
ing warrants, but allow them to b.
taken care of from tax collections
In the latter case it will be neces
sary to sell only sufficient certlfl
Gates of Indebtedness to take car
Of future expenditures until sucl
time as all warrants outstandin'
July 1 1923 have been retired b.
tax collections"
Do not Get Priority
Holders of registered warrant
are not entitled to priority of pay
ment, except in proceeds OF ia
collections; they are not entitled .
payment out of borrowed money.
In case a district finds it impossi
BILE to market certificates of indeb
tedness, or short-time notes, tn
district may register its warrants
as is being done at the present time
but they are not permitted to re
pister warrants until they have az
tempted to sell certificates OF IN
debtedness. "This attempt mus
consist of advertisement OF sal
! and receipt of no bids, the tax com
missioner holds.