Evening star. [volume] (Washington, D.C.) 1854-1972, 1956-04-08
Prince GEORGES.
Told Saturation
On Credit Nears
BY CHARLES A. McALEER

Prince Georges County's bond
ed indebtedness has reached a
point where its future credit rat
ing may be imperiled, county Of
f1cials said yesterday.
The county already has $3.50
million in bonds outstanding and
authority to sell two more bond
issues, which would bring the
total indebtedness to over $37.4
million. "
Officials say they have been
advised by bankers and invest
ment brokers in New York that
the safe limit" on bonded in,
debtedness should be not more
than seven per cent Of the coun.
tvs assessable base.
Prince Georges new assessable
base exceeds $526.8 millions, and
seven per cent of that would be
about 1868 million-less than
the total indebtedness If the
county disposes of the two bond
issues.
Bigger Debt Seen
Even greater Indebtedness lies
ahead, however, based on new
pleas for bond issues. One such
request, it was learned, is due
to come shortly from the County
School Board. q.
School officials contend that Q
conservative estimate of future
school construction needs will
require expenditure of $40 mill
lion a year for the next six years.
County School Supt. William
S. Schmidt said the School
Board hopes more bonds can be
sold next fall.
Only about $2.2 million in
bonds are scheduled to mature
next year, according to County
] Controller Carl Mace.
i The seven per cent limit is
not statutory in Prince Georges
County. although it is in some
other Maryland counties, officials
said. They said, however, that
investment bankers advise that
to exceed that margin would
cause interest rates to rise and,
possibly, hurt the county's
. credit rating.
legislature OK'd Bonds
The two bond issues as yet un-
sold were authorized by the State
Legislature. One would be for
$1.l5 million for an addition at
the County Courthouse, Upper
Marlboro, and other county Of
fee facilities. The other proposed
bond issue would be SIS million
for expansion of the Prince
Georges General Hospital.
OF the 1888 million bonds out
; standing. $31 .60o.390 are CLASH
, fed as general bonds. with most
, of the proceeds being used for
school construction. The other
, lS2, 206,0 900 are metropolitan dis
trict improvement bonds.
= The School Board. which has
spent over S42.7 million for
school construction since 1945.
received more than 1854 million
through bond sales yearly from
1945 to last year. 500
1t also has borrowed over SIG
million from the State, making
up the rest of the total spent
! for school construction from
State Federal grants.
New Buildings Planned
Meanwhile, school officials
rapidly are nearing completion
! of a new construction program.
The county already has some
1901 classrooms in 103 schools,
with 81 more schools under con-
. struction. School officials still
see the need for some lao more
secondary school rooms and 633
, elementary rooms. They esti-
mated the cost at some S62.5
. million.
Final decision on the bond
sale matter will be up to the
county commissioners, to whom
the school board plans to SUBJ
NIT its request.
County Assessor Louis w.
Kutsch advanced several solu-
lions to alleviate the problem
% additional help from outside
sources such as the Federal Gov
: eminent and State. (2) raising
the tax base either by increas-
: ing property assessments from
; their present so per cent of
market values or by attracting
new industry to the county, or
: ~ getting relief for some Of
the numerous exemptions now
permitted.
;, Mr.. KutSch estimated that
land value alone of the exempt
ed portion would total an esti-
mated $l2.l million. about S7.4
. million of which would take IN
, Federal land reservations in the
county.