The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1933-01-07
INTEREST EATS
BIC SHARE OF
SCHOOL FUNDS
$102,460 Paid on Library
Bond Issue, With None
of Principal Retired.
BY LOWELL NUssBAUM

BY LOWELL NUSSBAUM
Back in 1911. the citizenry Of IN
dianapois deemed it advisable to
build a new public library, and the
school board obliged by purchasing
site at Meridian and st. Clair
streets, paying for it by issuing
SIPS, 900 in bonds.
Today, the school city still owns
the site, on which handsome
structure has been built, but it also
owes the entire $l25,OOO bond issue,
despite the fact $1O2, 400 in interest
has been paid The bonds will not
mature until 1916.
This incident, together with many
similar ones, shown in a report
compiled today by A. B. Good,
schools business director, provides
a strong argument for hackers of
the -you-go' plan.
Since 1872, when the first Indi-
annapolis school bonds we're sold, the
school city has issued a total of
SIS, 674, 300 in bonds 1t still owes
1854, 900 Of that total.
Cost Is Enormous
Bond totaling only $5,O3O,300 have
been paid off in thai Cougar period,
but the staggering sum of $7O53 ,688
has been required thus far for the
privilege of keeping up with the
building needs of a growing school
population, and passing the bills on
to posterity.
The practice of issuing bonds was
started by the school city in 1872,
when 100000 bonds were sold.
At that time the board was in
formed by its attorney, school rec
ords reveal, that the law permitted
it to assume an indebtedness no
greater than that sum, and required
that the bonds be retired within
five years.
To meet this retirement provision,
the board refunded the issue four
times, until the bonding power was
enlarged in the 'ninetieS
After that, issuance of bonds to
meet cost of constructing school
buildings and acquiring sites became
a regular practice, but no extensive
issues we're sold until 1919 when
the board issued $1,3OO,0O0 for unit
at Tech, for repairs and real estate.
Amount Keeps Increasing
In 1920 issues sold totaled $4,236,-
600, while in 1921 an even greater
amount of bonds, $4,736OOO were is
sued.
Nearly $12,000,000 of the total
amount of bonds issued in the sixty
year period was sold in the last
thirteen years.
Thirty years ago, in 1903, an is
sue of 100000 was sold. OF this
amount, $4,000 still is outstanding
and will not be retired until 1884
and 1885. Interest thus far has to-
tailed $183,365. These are the oldest
bonds still outstanding.
The following year the board
floated an issue Of $150,000, on which
$140,962 interest has been paid and
$4,000 of the bonds still are out
standing
Although the main library site
pwas acquired in 1911 bonds for the
library building we're not author
lied until 1915, when a $500 900 issue
was sold, the entire issue to mature
in 1855.
Only One Bond Retired
Only one $1,000 bond has been
retired, leaving $4,000 outstand-
ing, and the school city paying out
$4,000 interest annually on the is
sue. Thus far, interest on The IL
brary building has totaled 1851 ,228
Thus the library site and build
ing bonds totaled 1925 ,000 of which
only $1,000 has been paid, and on
which interest already has amount
ed to $50l 200, and which at their
maturity. will total ST. ,055 ,29O, which
is $43O,OOO more than the bonds.
Many other amazing facts are
shown by Goods summary of the
cNAOOAo bOilNCQ QCOb. III 1899. Tie
school city sold $4,000 issue
which has been paid off, but which
cost $62,l00 in interest.
An issue of $1,645 900 for build.
ing the Teen shop and power house
and Schools % and &c was sold il
1920. These bonds will not mature
until 1910, but the board ha.
bought up and retired 100000. In.
terest on this issue has cost $947. 95G
thus far, and by 1910 will have cost
$1,496, 2O2.
Interest Equals Principal
Considering the fact that the
bonds were sold at a discount o.
nearly 100000, The interest il
twenty years will equal the princi-
pal.
The present school board, Coco
pointed out, has retired more bonds
than it has issued.
Since Jan. /, 1880 when the
present board came into power
bonds totaling only 100000 have
been issued, while other bonds to.
falling S1247,000 have been retired
a net reduction in the bonded deb
of $5470O0.
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