Perth Amboy evening news. [volume] (Perth Amboy, N.J.) 1903-1959, 1923-04-21
After State Meets Obligations
for Money Already Spent by
the Counties
PIERS0N OFFERS PLAN
Taxpayers Likely to be Sad
died With Interest Charges
on Bonds of S., ,625, 900

TRENTON. April 21.-If pro-
posed change in the plans of the
states financial officers for the
floating Of the $4o,oo0,O00 highway
and bridge bonds suggested to MEM
bers of the State House Commission
is adopted, the taxpayers of New
Jersey will be saddled with an extra
cost of interest charges on the bonds
estimated at s5,625,0o0.
The plan has been offered by
State Senator Arthur N. Pierson of
Union county, who has expressed
the fear to State Comptroller Bug
bee and State Treasurer Read that
the announced program of issuing
the bonds for ten-year periods and
the bridge bonds for fifteen years.
may fail to provide sufficient funds
for all the obligations, which 1t is
designed the issue shall cover. In
other words, according to Mr.. Pier
sons theory, under the plan evolved
by the State House Commission and
the State Highway Commission,
there may not be enough money to
build $40,000,000 worth of roads and
bridges after the state meets its OBJ
blSdLlOA15 " COdHtiCS AOE IIlOi1Gy Ill
ready spent under the reimburse
ment act and provides for the interest
and sinking funds to pay off the
bonds.
The Pierson plan is to have both
the road bonds and the bridge bonds
issued for fifteen-year periods. Un-
der this scheme, he figures that the
,oad bonds could be issued at an in
terest of 4H per cent. instead of 4 X /,
as has already been worked out.
This would entail jump in the total
interest charges on the entire bond
issue of $5,625, 900, which, coupled
with the s13,221,1S5. which it is es-
timated will be the total interest
charges under the plan already
worked out, would mean that the
taxpayers ofe New Jersey ultimately
would be called upon to bear the
burden of interest totalling approxi-
mately $19,000,000, instead of the
s13,221.1S5 already planned. 1t Is
not und erstood that the Pierson plan
involves any change in the interest
rates on the bonds to be issued GOV.
ering the cost of the bridges.
AS worked out by the state road
and financial officials, it is planned
10 divide the $40,000,000 up into
S30,000,000 for roads on ten-year
bonds at An per cent, and to spend
the other $10,000,000 on the bridges
to connect the roads with fifteen
year bonds at Az per cent.
1t is not the understanding here
that there is any fear upon the part
of state officials that sufficient
moneys to meet all obligations and
still have the full $40,000.000 for
highway purposes will be lacking.
Rather is it figured that there will
be surplus funds each year after
all charges and obligations are met.
In 1927 or 1928 it is figured there
may be a bookkeeping deficit OF
$4,000, but the states financial Of
flcials have estimated that the sur
plus of the other years invested at
the states usual rate of two per
cent will provide enough to meet
this deficit without in any way jeop-
ardizing the $40.o00,0o0.
1t is understood. however, that
Senator Pierson takes the view that
the intention OF the legislature was
TO get more money for highway
construction that the actual amount
named in the bond bill. But Messrs.
Bugbee and Read, told Mr.. Pierson
that when the people voted "Forty
million dollars" for roads. they did
SO with the understanding that that
amount, land no more" was to be
raised and it is UP to the states
financial authorities to float the
bond issue on the most economical
basis for the taxpayers.
Senator Pierson made the sugges-
tion that there will be unforeseen
extras in the road program and
more money would be needed than
was provided.