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Show Urges Serial Bonds. Editor Trlbunft A creat clenl is being be-ing said and printed about proposed new city and county bond lenucs. Wc read that tho city is noon to put out an l3suo of $757,000, with" which to redeem an old lssuo about to fall due. This will bo In addition to tho lssuo for water Improvements, Improve-ments, upon which tho taxpayers aro Bhortly to vote. Tho county cxpucta to como along by and by with $1,000,000 of special roud bonds. With no Intention ; of befogging the question of vhother or j not these Issues are advisable. It occms worth while to aslc what form these bondsi shall take. In case thoy aro authorized. au-thorized. Shall Salt l.ako City and county stick to tho old-fashioned sinking sink-ing fund syatem, which lb rapidly becoming- obsolete, or shall they adopt tho serial bond method, as the most advanced ad-vanced communities are now doing? A bond Issue means borrowing money, and provision must be mado to pay off the debt. Under the sinking fund method meth-od a certain sum Is raised annually, by taxation, which, with accumulations by compound Interest, will pay off tho loan nt maturity, Ey means of serial bonds tho loan Is paid off by crjual annual In-Klalhncnts In-Klalhncnts of tho principal, plus tho Interest In-terest on the unpaid balance. Verified computations show that on an lesuo of SI, 000,000 of A per cont bonds, running twenty years, tho diffcrenco In cost In favor of sorlnl bonds as compared com-pared with sinking fund Ik $40,231. Sinking funds arc complicated, and requires re-quires Intrlcnto mathematical calculations to be accurate. They entail keeping and investing largo sums of money through a long term of years, and ure, therefore moro or loss subject to neglect, mismanagement, mis-management, loss, theft, or diversion to other purposes. The aerlul bond Is simplicity Itself. A certain portion of the debt Is paid off each year, and thnt Is the end of It. These bondB work on tho prlnclplo thnt "tho beat way to sink a dobt Is to pay It." Massachusetts prohibits sinking funds for municipal loans. The constitution of West Virginia says: "The payment of any liability other than that of the ordinary or-dinary expenses of tho state shall be distributed ovor a period of at least twenty years." In Canada they have oorao to tho conclusion that tho toy of tho sinking fund Is PVf.Mnal v curse to the average municipality. Tho tlmo seems opportune for Salt Lake Cltv and county to pay some atlen-Uon atlen-Uon to this Phaao of tho bond question. It should at least c '00JcdHm,ERN Bait Lako City. January 20. 19H. |