Evening star., 1949-11-09
.MontgomerY's S
Credit Secure,
New York Experts
Report Finances
On Sound Bosis
D.. D 7~s
By ]. B. Zotmon

VII SSS'S S~SsS
By J. B. Zotmon
Montgomery County is in sound
health and its credit po-
sition is secure" according to a
survey just completed by a New
York firm of fiscal experts.
Results of the survey, which
also covered the operations of the
Suburban Sanitary
c Commission and the Maryland
National Capital Park and Plan
ming Commission, are contained
in a 116-page booklet made public
at the County Councils meeting
yesterday in Rockville.
Accompanying the report were
several recommendations intended
to help the county maintain its
high financial standing.
The study, which cost $4,000,
was authorized by the council
last March. Its purpose, according
to Council President Frederic P.
Lee, was to compile a readily
available source of information
on the county's financial affairs.
Credit Rating Cited.
He said such information also
was needed as a result of the
action of credit agencies in rat
ing down" the value of county
bonds, thus making them more
difficult to sell and forcing the
county to pay higher interest rates.
Mr.. Lee attributed this condi-
ton principally to the practice of
former Boards of County Com
mlssioners in refunding bonds
when they came due, rather than
paying them off. This policy
changed in 1947, he said, and the
county now pays its obligations
when they mature.
One of the recommendations,
submitted by the firm of VAIN
wright, Ramsey & Lancaster, calls
for the county to include a pro-
vision in its bonds to permit them
to be paid off before they come
due. If the market interest rates
drop after the bonds are sold.
This, it was explained, would en-
able the county to issue new bonds
at the lower rates.
Service Charge Urged.
Another urged the county to
charge the sanitary and planning
commission, incorporated towns
and special improvement areas for
its services in collecting their
taxes for them.
Under a third recommendation
the county would fix a uniform
charge for all road construction
and maintenance, rather than
treating these projects in the sub
urban areas as matters of special
benefit"
Eventually, the report stated,
the cost of highway construction
and maintenance should be paid
out of the county's general tax
fund, and not from special assess
ments. as at present.
In a series of conclusions,
the report described the present
county tax burden as relatively
light" The firm added that the
county's proposed $4,000, 900 cap
ital improvement program for the
current fiscal year "can be safely
undertaken if the budget is con-
sistently balanced and taxes are
increased to meet the needs"
1--WE do not believe" the report
said. that the costs of carrying
the added debt burden will strain
the taxpaying ability of the people
of the county"
improvements Reported.
In discussing the county's new
charter form of government, the
report said the change from the
old commissioner setup "is re-
sulting in improvements in the
conduct of the county's govern
mental and financial affairs"
Members of the County Council
and the county's administrative
heads also came in for high praise
in the report.
Their approach to the prob
lens connected with the county's
growth the report asserted, has
been realistic and their planning
OF the financing of new improve
ments is following sound lines"
The county's population as Of
July l, -1949, was estimated at
$4,000 and its assessable base at
1926. 759, 900. Prince Georges
County's assessable base, accord
ing to officials there, is about
$211 1000 900.
In percentages of high school
and college graduates in the
county, Montgomery ranked first
among all metropolitan counties
in the United States, according to
the report.
Finances sound"
The financial structure of the
Washington Suburban Sanitary
Commission, treated in a separate
section. was described as Sound"
Referring to the county's liabil-
ity for payment of commission
bonds, the report said the possi-
bility Of the commission default
ing on its bonds sis very remote"
In addition, the report said the
present practice under which the
county guarantees the sanitary
agency's obligations 'has a psy-
Geological advantage in the minds
of prospective buyers of the
bonds
AS result of this procedure.
the report said, the interest rate
on commission bonds is relatively
low "and there Is no reason to
discontinue it. We do not believe
the county's credit would be Inn
proved by removing that guar
antee."
At the same time, the surveying
firm recommended that the county
and commission officials consult
,ryifI,