Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1925-01-23
Facts Allow of No Controversy
He Declares-Financial Con-
dition of State Sound Des-
pite Cash Balances for Past
40 Years Have Not Been
Enough to Cover Reserves

William L. Bonney. State Treasur-
err. n an announcement made Thurs
day t. Kennebec Journal represen-
tative, took up The cudgel to effec-
tually squelch further discussion and
perverted controversy on the ques-
ton of State Trust Funds, Reserves.
etc.
There can be no real controversy
over this matter" Mr.. Bonney de-
clared. 1T serves as something to
talk about in a political way, and
furnishes material for newspaper
Stories"
Ihese reserves may be represent =
ed by. actual securities, by cash, or
they may be regarded as simple Ii
abilities which the State carries and
on which the State pays interest
each year; liabilities, for the most
part. which the State will never be
called upon to liquidate.
Deficit for 40 Years
Some of the Trust Funds, like the
Levi M. Stuart Fund, contain the
provision In the deed of gift that the
principal shall be safely inve.ted and
the interest each year paid over for
q certain purpose. Other Trust Funds
and Reserves carry NJ such provision
and the laws of the State do not re-
quire cash to be retained in the
treasury as an offset to such funds
An examination of the annual re-
r from this office for the last &C
years will show that at the end OF
each fiscal year there never has been
sufficient cash in the treasury to
cover these reserves. 1t would be as
sensible to require the State to keer
as it would to oil 'ige business cor
poration to keep it's capital in the
form of cash.
"When I took over this office we
had s5,500,000 on hand, but after de-
Quoting what we owed the Soldiers
Bonus War BOND Issue, Highway
Loan and Farm Loan it left our Cen
eral Fund too little to cover our re-
serves.
Reserves and Trust Funds Worth Par
III the bonds of the State are
worth 100 cents on the dollar the Re-
serves and Trust Funds are worth
par.
I'm the sos the State received
from the Federal Government S11S.-
800 for the support o" the University
Of Maine. The State spent the
money and issued to the State Col
lege one Unacceptable bond for the
above sum, a 80. ear. five per cent
bond This bond was renewed in
1919 for 80 years. If this Legislature
would make this negotiable I'll guar
antee to sell it for more than it's face
value. OF course. in the year this
money accrued to the State in the
sos, the tax assessed was less by
$118,S0O. The bond is a direct liabil-
ity, probably will never be paid by
tn. State and I presume the L. of NJ
has no fear that it will lose it's yearly
interest.
"If 1 wanted to leave the income
on $4,000 for the support of any in
stitution / think l should prefer to
have the State take the $4,000 and
g,.-rantee to pay over a fixed per-
centage each year than to leave such
a sum in securities to the State. I'd
sooner trust the honesty and good
faith Of future generations than trust
In addition their financial judgement.
State Financial Condition Sound
"Three weeks ago Governor Baxter
te', the people Of Maine that the
financial condition of the State was
creiitable and sound. and l know he
spoke the truth although we have
not the amount Of cash he started
with or anywhere near it, and we
have something in the way OF unpaid
bills"