OCR Text |
Show A STUPID DEFENSE. It Is astonishing to see to what extremities ex-tremities the County Commissioners of this county are obliged to resort In defense de-fense of their bond deal. They sold the other day ?350,000 of refunding , bends of Salt Lake county." After calling call-ing for bids on these bonds, they awarded the sale to a concern which took them on a four and a half per cent Interest basis. After tho bids wero opened, thf Commissioners went Into secret session and allowed representatives representa-tives of some of the bidders who were hero to add to the bids certain Inducements Induce-ments for awarding them the contract. Among these Inducements was a present pres-ent concession amounting to 5S3C0 and a free trip for-two of the Commissioners Commission-ers to the East. Another "bidder put in a straight bid for the 'bonds on the basis of four and one-eighth per cent. Th refunding bonds were to run twenty years. The difference. between four, and one-eighth per cent and four and one-half per cent, If we allow for all tho subsequent personal concessions made by the representatives rep-resentatives of tho bond houses present pres-ent (theso concessions having bcn made after tho bids were opened), we still find that the county will eventually event-ually pay on the twenty-year basis $17,000 moro in fulfilling the contract entered into between the Commissioners Commission-ers and the firm to which thoy awarded tho bonds, than tho county would have paid in a clean, straightforward acceptance ac-ceptance of the four and one-eighth per cent interest bid. To avoid the force of this, the Commissioners Com-missioners now urge that the bonds are redeemable after ton years; therefore, they say that tho bonds can be taken up at tho end of ten years and a new issue made for four per conL This figures fig-ures out a couple of hundred dollars or so in favor of their action. But what assurance is there that ten years hence they can sell bonds on a four per cent basis? If it is merely the purpose pur-pose to excuse their present bad financiering, finan-ciering, why not say, as they could just as well say, that ten years henco these bonds could be sold on a three per cent Interest basis, or even a two per cent basis, for that matter? As long as one goes into the wild guesses of a ten year's futurity, what Is the particular use of restricting the low-ness low-ness of the interest rate to four per cent? Two per cent Avould make a much better showing. The Commissioners Commis-sioners do not deal with futurity, but , with the present. The childishness of that kind of financiering, the rldlqulous folly of making that sort of a statement state-ment as a present financial showing, Is too patent . to need any argument. The plain fact is that I he contract was awarded on tho twenty-year basis. There is no likelihood that the bonds will be taken up at tho end of ten years, or refunded if the attempt to do so was made; or that a more favorable fa-vorable rate than four and one-half per cent could be had. It Is wholly a matter of guesswork and entirely outside out-side of the domain of present financiering finan-ciering to urge any such pretense as this. Besides that, the Commissioners were guilty of doing this business In secret, so that the public does not know even now Just what quirks and quibbles and disadvantages it may have to face in the future. It is true, also, that the representatives of the bond buyers who were present were allowed to come In after tho opening of the bids and amend their bids to the disadvantage of those buyers who did not have representatives representa-tives on the groufidl To allow concessions conces-sions to be made after the bids were opened, was In law to reopen the whole question. It was accepting an amendment amend-ment of a bid without any public notice and without any warrant of law. The advertisement put, out by the, Commissioners Commis-sioners was, and Us only lawful effect could be, to tho purport thut the bids that were opened at tho time specified speci-fied were the bids that would bo considered. con-sidered. It was no part of-the transaction trans-action that the representatives of the bond buyers who. might be present could, como in and add to or take away from the bids as submitted. It was unfair to the bidders who were trusting trust-ing to the good faith of the advertisement advertise-ment and the honesty of the Commissioners. Commis-sioners. The effect of it must necessarily neces-sarily be to discredit Salt Lake county's flnanclul management, and If at the end of ten years, or any other time, Salt Lake should attempt to advertise for bids on a refunding Issue or any Issue of bonds, the bond buyers would be wary of bidding unless they wero prepared to send a representative to this city to be present at the opening and have an opportunity to add or take away by word of mouth from the offers made, sealed and delivered. , It is a bad business all around. Bad for the- financial repute ot the county, and bad for the taxpayers who will be required to put up $17,000 additional interest in-terest money because the County Commissioners Com-missioners were not financiers, did not act In- good faith, and have put the financial standing of the county In jeopardy. A short time ago, the same firm which was awarded these Salt Lake county bonds, bought a four and a half per cent Issue of Ogden bonds. They arc now offering these on the Kastern market at four per cent pro-, mlum. They will no doubt put these' Salt Lako county bonds on the mkr-ket mkr-ket at as high a rate. What was the matter with making a negotiation of sale which would give this county some of the ndvanlagos of this premium? The answer Is, that Salt Lake county was represented by such poor financiers finan-ciers that they were outwitted at every turn. And the taxpayers pay thousands thou-sands of dollars for the Commissioners' stupidity. |