The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1931-09-17
STATE FACES
BANKRUPTCY,
DEPUTY SAYS
CoSgrove, Auditors Aid,
Gives Warning of Huge
Deficit Danger.
ASKS SPECIAL SESSION
Slash by Institutions Seen
as Only Other Course to
Avert Disaster.
BY BEN STERN

Bankruptcy, with deficit OF ap-
proximately $1,500, coo, faces the In
diana state government.
This was the warning sounded to-
day by William Cosgrove, deputy
auditor OF state, at a meeting OF
Democratic leaders at headquarters
in the Claypool hotel.
All that can save Indiana from
this situation, Cosgrove said, is to:
Slash state expenditures. or
Increase the state levy from %
cents to approximately "a cents.
If state expenditures will not be
slashed voluntarily by institution
heads, then a special session OF the
general assembly should be convened
to make the necessary reductions,
was the warning.
Party Leaders Here
Call for the conference was issued
Wednesday night by R. Earl Peters,
Democratic state chairman, when he
was acquainted with the precarious
condition of the states finances.
Those meeting here, besides Pet
ers and Cosgrove, are Representa-
tives Walter Myers, Speaker OF the
house; DELPHI McKesson of Plym-
outh, house majority leader, and
Earl Crawford of Milton. house
caucus chairman; Senator Walter
Chambers of Newcastle, minority
leader; Senator Francis Lochard of
Milan, senate caucus chairman;
Fred Van Nuys, Democratic execu-
tive committee chairman in the
last campaign; Evans Woollen, In
dianapolis banker and 1923 favorite
son candidate for President, and
Mrs. A. P. Flynn Of Logansport,
state vice chairman.
Crawford announced his plan for
a special session at the opening OF
the conference.
Demands Appropriation Slash
He pointed out that there has been
such a decrease in commodity
prices that the appropriations bill
passed early this year, although
containing practically the same
figures as two years ago, amounts
to almost a 100 per cent increase.
1--WE have but two remedies open
if we are to keep down the state
levy. One is a special session,
which would be called for one spe-
cific purpose, to slash the appropria-
tions for institutions, or in line of
this Governor Harry G. Leslie
should consult with members of both
houses and order institution heads
to reduce expenditures.
1.-THE expenses of the session,
which should last about three days
and be only for the purpose Of cut
ting the appropriation bills, should
be borne by the members, if it
would be called"
Hopes Leslie Will Act
Crawford expressed the hope that
the Governor would see fit to order
the reduction in expenses without
the need of special session.
Cosgrove pointed out that when
Leslie took office in January, 1929,
there was a balance on hand of
more than $4,00O,O 900 and since that
time it has dropped to approx
mately $1,500,0OO.
THE present general fund levy
rate of 1885 cents is not sufficient
to meet the appropriations for the
next biennium, Cosgrove declared.
THE balance on hand at the end
of the fiscal year, Sept. 30, will not
be sufficient to operate the state
government until the December tax
payments are received. And even
when this is on hand, there will be
a deficit Cosgrove declared.
Reading his tabulations for the
1931-1932 fiscal year, Cosgrove
pointed out that the estimated bal
ance Oct. l, 1881, will be 81 500 900;
receipts other than by direct taxa
ton will total $5,50O,000, and esti-
mated December tax payment
should be, under normal conditions.
S4,000,000, thereby providing for a
total of $11, 100000
THE 1931-1932 budget calls for a
total of S14,537,79i, which would abb
serb the entire balance, and that
even If the normal tax expectancy
OF $13,800,000 would be raised
which really can not occur under
present conditions-there would be
deficit of $751; 9I."
The 1932-1933 budget calls for
sl4,4O4,437 and the receipts, under
normal conditions, would be but
$4,000. 600, making for deficit that
year Of $604, 437.
This would make a total deficit
for the two years of 1892 600"
Cosgrove pointed out. "And we are
sure that under present conditions
tnlS is minimum figure.
Operates at Loss
Very few people know that the
state has been operated at a deficit
OF slightly more than $1,000. 600 a
year since the Leslie administration
assumed Office.
The estimate of all receipts is
based on a 100 per cent collection
Of property tax.
Tax collections this fiscal year
alone were s260,452 short of the
estimate and it was necessary to din
into the balances" Cosgrove pointed
out.
1t was pointed out that the state
tax board has the power to cut the
general fund levy of 1885 cent and
the teachers retirement fund of
.024 cent.
The state levy is to be fixed next
Wednesday and The statutes provide
that it must have the approval OF
Governor Leslie and Auditor Floyd
Williamson 50 srnadu acfinnn ir