The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1929-02-21
ARMORY QUIZ
STILL UNDER
DOUBT CLOUD
Probers Fail to Get All
Answers to important
Finance Questions.
M'WHIRTER IS WRATHY
Peoples Bank President in
Clash With Senator on
Tax Exempt Issue.

Senate investigation of armorv
construction under the "closed cor
poration" plan neared completion
today, with important questions still
unanswered.
These include the manner in
which the ar1nories were built on q,
so-called ''cost-plus' plan, with the
bond issue made before construc-
ton started.
How estimated building costs, as
testified to before the senate probe
committee, we're far below the build
ing costs as listed in the report of
Adjutant General William H.
Kershner
Why it was necessary for the Os-
from Realty and Construction Com
pany to discount tax-exempt bonds
when turning them over to the
Peoples State bank, it's parent in-
stitution
How the bank sold the bonds. ad-
vertised at a premium, because they
were tax exempt and alleged to be
state backed.
AL ABOUT that tax exemption.
Bankers Ire Reused
The last named matter was the
cause of a clash today between
President Felix M. McWhirter of
the Peoples State bank and Senator
Carl M. Gray. Petersburg, member
of the senate investigating commit
tee.
The bank president sent Gray a
letter taking him to task because of
comments the senator is said to
have made about the tax free
bonds.
These bonds we're handled by the
Peoples State bank and all con-
Struction of arrnorieS, during the
jackson regime, when the system
was effective, was done by the
Ostrom company.
In McWhirter's letter to GRAY. he
calls attention to what he calls 'the
official opinion of the state board
OF tax commissioners" regarding tax
exempting the armory bonds. Gray
is said to have remarked that tax
exemption was based on "a flirnsy
letter from the tax board"
McWhirter Is Caustic
McWhirter's letter commented as
follows:
Your statement shows degree
of temerity on your part"
The Indianapolis Times called at
tentlon early in the investigation
that the bonds were made tax ex-
empt on a letter, merely an opinion,
sent by John j. Brown, then chair
man OF the state tax commission.
to the Peoples State bank, Brown.
now secretary to Governor Harry G.
Leslie, said that he set up certain
qualifications in the letter and
didn't know whether the present ar
mory bonds had met them or not.
Search of tax board records today
failed to reveal the official opinion
referred to by McWhirter, and Will
liam A. Hough, present chairman.
declared that long ago he expressed
the opinion that the bonds should
not be tax free.
McWhirter also sent a letter to
w. w, Suckow, trustee of the
armory at Franklin, declaring that
he (SuckoW), had signed all in
strulnentS necessary to carry on
construction under the trusteeship
plan approved by the state armory
board.
Listed at 100000
SuckoW had testified before the
senate committee that he signed a
single paper and admitted that the
trustees were mere fgureheads.
A Franklin contractor testified
that he would estimate the con-
struction costs at approximately
$4,000.
The building is listed by Adju-
tant- General William A. Kershner
with $4,000 construction costs and
the state will pay 100000 for it,
through the lease-rental system, ac-
cording to the budget clerk of the
state board of accounts.
Senator Alonzo H. Lindley, King
man, chairman of the probe com
mittee, stated that the report will be
completed tonight and ready for the
senate Friday.
He received some figures on bond
issues today from the state board of
accounts, he declared.
Times Gets Data
An example of the sort of data
obtained are the following figures
obtained by The Times:
Anderson arrnory, bond issue
$4,000. total interest to be paid
$14,602.50, in twenty-seyen pay
mentS of $4,000 mi-annually and
final payment OF 60,250.
Ft. Wayne armory. bond issue
SIPS, 900, interest S44,947.50, semi
annual payment s6,250.