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Show AUDIT STUDIED Oil LAUD BOARD BOND DEALINGS Report Follows Probe by Legislative Committee Acceptance or rejection of the long awaited audit of state land board bond transactions was being be-ing debated behind closed doors by board members at the capilol late Thursday. Rumors were current la the statehouae, however, that sensational sensa-tional disclosures are contained la the audit, which was made aa the result of a- probe launched by a special Investigating committee, of the hut state legislature. For what was believed to be the first time in Utah's state government govern-ment history, an auditor's report was delivered to the department concerned the state land board in this case and not immediately made public. Despite a comment from Attorney General Joseph Ches that the "audit report was publie property," members- o the land board remained closeted In executive session Thursday Thurs-day afternoon to hear the audit report read by R. R.' Carey, accountant ac-countant in the state auditor's office, of-fice, and declined to release the audit to press representatives. Rejection of the audit, it was contended by the board, will prevent pre-vent its publication. May Reject Audit "We may not pass on the audit until tomorrow,' reported John F. Tolton, Beaver, land board chairman, chair-man, "and, don't forget, we have the right to reject the audit and prevent its publication." H. Warren Taylor, board secretary, secre-tary, backed Mr. Telton In this stand. The secrecy with which the land board was cloaking its deliberations delibera-tions gave rise to the wildest sort of rumors at the cepitol. but it was felt in usually well-informed quarters quar-ters that the audit requested a grand jury inquiry of bond investments invest-ments of the land board. State Auditor John Guy disclosed that a partial audit report was ready for the land board October T, but the board declined to accept it and at the regular meeting October 21 there was no quorum so the completed com-pleted audit could not be presented then. Audit Discussed Mr. Guy and Mr. Carey called upon Governor Henry H. Blood Thursday morning and. although Mr. Guy declined to comment, it was learned that "certain angles" of the land board audit were discussed. dis-cussed. Since this audit follows on the heels of a partial audit made by a special investigating committee appointed ap-pointed by the last legislature, it is expected to probe deeper into some of the transactions disclosed before the legislature and be sharply critical criti-cal of the handling of bonds by the state land board. One of the cases cited by the legislature's leg-islature's investigating committee involved the sale of refunding bonds of the South Sanpete school district to the state industrial commission by "a certain broker" two months before the original bonds were released re-leased by the state land board. Particular Case In this particular case, the South Sanpete school board, desirous of refunding $34,000 in bonds held by the state land board, was told that the state did not wish to sell the bonds, even though it was assured that no loss would result. Shortly latsr. however, a Salt Lake City broker allegedly informed the south Sanpete board he had the (Coutlnoee: on Pact Sna) -t Column Ofkcl I AUDIT ON BOND I ; DEALSJIUDIED (CoflthtiMd from Pas On) desired bonds In his vaults and would be pleased to handle the refunding re-funding deal. The legislative committee's audit cited records to show that the in-dustrial in-dustrial commission purchased the (34,000 in refunding bonds for a total to-tal of 68.000 on October 14, 1938. Stats land board records ahowedt however, that the original $56,000 in bonds to be refunded were not sold to the broker until more then two "TBSMhrlaterrDecember 17, 1M, at a price of (61,471. Bate Reduced Only concession to the South Sanpete San-pete school board was a Vi of 1 per cent interest rate reduction, and the difference between the price paid by the industrial commission and the amount received by the state land board represented a loss to the state of $7529. Soma intimation as to the tenseness tense-ness of the situation at the capitol was aeen late Wednesday in a clash between Mr. Carey and Deputy Attorney At-torney General Grover A. Giles at i a session of the state loan commission. com-mission. Mr. Carey's assertion that "it is the duty of the attorney general's office to trace every bond Issue back to its beginning" brought an immediate im-mediate challenge Trom Mr. GileJ. "All the attorney general's office requires is a transcript from the atata agency concerned in the bond transaction," Mr. Giles insisted. "It would require the full time of another an-other deputy added to the staff to check and examine all bond issues." No Indication The land board reconvened at 1:30 p. m, but there was no indication indica-tion as to what action it would take. It was expected around the capitol, capi-tol, however, that since the audit just completed concerns only bond transactions, another dealing with rentals, sales and general management manage-ment of public lands by the land board will follow shortly. Members of the board, and their date of appointment, are Mr. Tolton, 1933; LeRoy D. White, Brigham City, 1934, who represents the Utah State Agricultural college; Elias Hansen, Salt Lake City, 1935, representing repre-senting the University of Utah; Mr. i Taylor, 1936, who represents the state school system, and L. R. Anderson. An-derson. Manti, 1937. Mr. Hansen and Mr. Anderson are Republicans, the other three Democrats. Demo-crats. George A. Fisher is executive secretary sec-retary of the board. |