The Waterbury Democrat., 1941-08-12

1, The prospectus states that Wa terbury has favorable debt rec ord," with 60 per cent of its general bonds due to be retired within the next 10 years. It is pointed out that the present gross funded debt of $16,940,500 is $2,300,O 900 below the peak figure of 1888 and $900,000 be- low total in effect at the beginning of 1930.
 The investment firm praises the city's handling of the relief prob lem during the depression years, citing the fact that relief bonds were issued only once. Tax delin- quency has been improved, it states, and operating surpluses have been achieved by the city during the past several years.
 The city is 1auded in the prospec- tus for not resortng to the practice of debt refunding since 1888, in con- trast to other cities which pay off bonded debt by issuing new bonds.
 Summarizing, the prospectus says the city's cash position is strong, tax delinquency is moderate, re- serves are sufficient and debt is be- ing reduced substantially. Again, it states: 'The city is not resorting to refunding."
 The text of the Lazard Freres 6 Co. prospectus is as follows:
 The debt record of the City of Waterbury during the depression period and particularly during the last few years, we believe, has been definitely favorable. The present gross funded debt of SIG, 6,940,5OO is $2,300,000 below the peak reached in 1898 and $900,O0O below the amount outstanding at the begin ming of 1930. After deduction of water debt, general bonds outstand- ing amount to $10,108,500 or more than $2,500,Oo0 less than the 1888 peak. As indicated by the ratio to assessed valuation of 5.9% and the per capita figure of $102, this gen. eral debt is moderate in amount. The entire debt is in serial form with no sinking funds required and is scheduled for orderly retirement with more than 60% of the general bonds maturing during the next ten years.
 The City's favorable debt record, we believe, is in large part result of the City's handling of the relief problem. In an industrial city such as Waterbury, it is natural to ex- pect 8 relatively heavy relief bur- den during periods of depression Yet Waterbury, owing to a system of employer -employe contributions for relief and to the use of current revenues for welfare purposes, iS- sued relief bonds only once during the deperSsion period. Since the funding of relief costs in 1886, the City'S share of expenses for both home and work relief has been met by current revenues. Furthermore, Waterbury has not resorted to the practice of refunding since 1888, whereas debt retirement in many other cities is being retarded by continued reliance on refunding.
 Tax delinquency naturally in- creased materially during the de- precision years but the increase was less than average as indicated by the Dun & Bradstreet survey for 150 cities of 50,000 population which showed an increase between 1930 and the peak year of 10.6 percentage points for Waterbury, as compared with median increase of 1892 points. Current tax delinquency now is moderate and is more than covered by budgetary reserves. AL though cash operating deficiency was accumulated during the depres- sion period, it never reached serious proportions, in our opinion, and was in part result of relief financing from current revenues. During the last three years, annual operating surpluses have been achieved and at the end of 1940 g substantial cash surplus was reported.
 The past administrative abuses