The Sauk Centre herald. (Sauk Centre, Stearns County, Minn.) 1886-current, 1932-04-07
CREDIT BUREAU
COSTS INCREASE
Olson Administration Has
Been Expensive Luxury
for Minnesota Farmer
DEPLORABLE CONDITION
State Auditor King DisclOses
Some Startling Facts In
Recent Statement

Preliminary Investigations of the
Rural Credits Bureau Instituted as
a result of the refusal of the In
vestment Board to vote additional
funds for the Bureau have already
revealed that the Gaarenstroom-
Frankson regime has increased the
Rural Credits payroll enormously
and undertaken refinancing pro-
jects designed to help eastern
money lenders. .-..-..--
Stafford King. state auditor and
member of the Investment Board,
has charged that the present adj
ministration of the Rural Credits
department is not worthy Of furth-
er support from the Public school
trust funds.
The vouchers of the Department
Of Rural Credits introduced to the
state auditor by the Rural Credit
officials shows that travel expense
for the year 1880 aggregated $685.
573.97, while for the year 1881 ira
vel expenses aggregated $73, 223.01,
or a total increase Of SIC, 649.04, Mr..
King reported. Similar records on
file in my office show salary in
creases for the Department Of Ru-
raj Credits in 1881 over 1880 to be
SAT ,220.99. salaries having been in
creased from $156, 650.37 for 1880 to
SOS, 871.36 for 1881. These two items
of salaries and travel alone show
an increase to the taxpayers of the
State of Minnesota in the Depart
ment of Rural Credits of $5,312.50 a
month, or $63,750 per year. This
known and definite increase in the
cost of administration does not
give me confidence that still other
increases may not have been made,
or that still further losses upon
loans may not be incurred.
Moreover, I have in my file the
records of some six loans made
during the administration of Mr..
Gaarenstroom which show pay
ments to insurance companies,
trust companies, and banks out of
moneys applied for by farmers. I
am of the opinion that these loans
are simply refinancing loans, and
that the only possible way the
farmer could benefit would be
through the securing of a lower
rate of interest, while the State is
left holding the sack, and the or
iginal investment company secures
a return of 100 percent on it's origi-
nal loan plus interest during the
period thereof. am ABSOLUTELY OPP
posed to any funds of the Depart
ment of Rural Credits being used
for the refinancing of loans in such
cases, and object to the sending of
the money of Minnesota to fill the
Golfers of the Eastern bankers.
I voted against the withdrawal
of an additional 100000 from the
trust funds for the use of the Bur
eau Of Rural Credits. When so
cast my vote, was thinking more
of my duty as a trustee of public
moneys than about the functioning
Of any particular Bureau or De-
partment of the State. was think
ing Of the taxpayers of the State Of
Minnesota, and more especially the
farmers upon whom the present
tax burden is almost unbearable.
AS state auditor, it is my duty
and by no means a pleasant one, to
spread the tax levy in the State.
Comparative figures show that this
levy this year is higher than 1t has
been at any time since 1919 when
the State Of Minnesota issued
$40, 600, 900 Soldier Bonus.
There is nothing to prohibit the
Bureau from selling its bonds in
the open market. It has already
sold some $33, 900, 900 there without
increasing the rate of interest to
the farmer. agree with Mr.. Gaar-
enstroom that the farmers of Min
nesota need cheap money, and re-
spectfully suggest that all other
citizens of the state need it also, and
I call attention to the fact that any
loss from the public trust funds
must be made up by additional tax
levies. Under the Constitution these
funds must be kept inviolate and
undiminished.
The State Investment Board has
already extended credit of 500, 1885,
600. to the Rural Credits Bureau
from Minnesotats Trust Fund. This
is 37-14 percent of the total
amount in those funds and nearly
so percent of the entire Rural
Credits issue.
resent the implication of Mr..
Gaarenstroom and his fellowmem-
Der of the Rural Credit board that
my. vote against any further loan
from the public trust funds of the
State to their Bureau is one of OBJ
struction, or that it is contrary to