Show TXIE ANSWER ass ANS welt empina lish t I 1 OFFICE OP tiie tire AUDITOR I 1 I 1 eb 1894 friia fraid francis i cope cop LE esy esq sq U 0 it 7 R sait sail lake city liy ily ley my dear deap str sir I 1 have your very interesting te c r st ink ing letter of bf the ath dinst ln stin in re fe ference to building association matters and also a copy of the constitution and by laws of zions benefit building society I 1 have looked carefully over the constitution and by laws and with one or two trifling exceptions consider them very carefully drawn r do I 1 however think that the interests of building societies societies require that each stockholder should have but one vote the arhe laws of utah require that the numb number ea of votes held by any shareholder in a dorp corp corporation oration shall be according to the number of shares assessed by him editor D N and also that the society will need to exercise unusual care if they as sis a body under undertake the building or alteration of hoil hotl houses ses to be paid for foi out of the funds of the society of course the society can ran do this wor work kandI kandl and I 1 only say that they will need to be extremely careful As already said the tho constitution and by laws are carefully drawn but it is to the practical workings ol 01 of the society that you will have to look abr success or failure there is no reason why building societies should not be conducted with entire success and from the tenor of yop conr r letter I 1 am satisfied Is that yo your urso society clety will be a complete piete success you thoroughly corni the airas ainas and ud object 0 a baud ing sc society lety and when men of integrity and ability evince such an interest in them as your letter dis discloses closs I 1 feel more inore than satisfied of their complete success yau very pro properly erly remark that yours is llo lio not intend stid much tor for investors as it is to enable the members to acquire homes through iland this i is s really the grand object 1 of I building societies in general whilst building societies are principally intended for enabling people eople to acquire homes or to liquia liquidate ate some indebtedness on one perhaps already acquired 0 or to do any other laudable work still still it must be understood that if properly conducted they offer a safe and profitable table tabie investment for those who do do not wish to borrow and as it is well weli known thac all cannot become borrowers there should be no discrimination between borrowers and non borrowers the real business of building societies is very verj very simple and consists mainly in receiving and invest in vesting the dues or deposits of m mem embers members bers beis but I 1 need hardly remark that there is a very grave duty involved in investing tile the funds that is in loaning it t to 0 tei teb the e members because this is its legitimate use the hoara board of directors should see that the security offered is s to protect the society and in thus protecting the society they tiley are also guarding in the individual members interest of course they should not use nse their authority authority so as to prevent a member fro from sharing ing the benefits the society is intended to confer all ali they should want is to be reasonably sure the society ethwill will not suffer there should be no funds in the treasury the funds at all times should if possible be in use by the members and if there should a perlo period d arrive when the money cannot be prevented from accumulating in the treasury and thenis no stock near maturity there should be some provision made for distributing it that is by loans to the members the point is that the paid wald up capital should be always working in in regard to the rate of interest charged I 1 do not see sec that it makes much difference whether the rate is 8 or 10 per cent it would however have been as good to have it the legal rate although I 1 think without knowing in the actual workings of your society that 8 per percent cent will i more ore nearly equalize I 1 z L the interests of borrowers and non uon b borrowers 0 rr in reference to your method of aawar awarding sin rin loans I 1 would at this dl distance prefer selling them and betes deter ming t the ie party by the amount of premium bids eve even if this premium were g returned to them n again when stock matures but I 1 have no objections what whatever everto to your our plan pian providing atae it accomplishes comp lishes tn the desired object and antl of aliis you vou are the judge there Is a bare possibility of bf favoritism being shown udder the application plan pian which could not ve very well weil happen under open competition the plan under which you are working is one which has a tendency to lengthen the life of the association but this is no fault on the tile contrary it has ilas its advantages I 1 as I 1 think the equllia equillo i hium between betge en tho tha borrowed and non borrowed shares is better preserved than in those which charge a premia ai and retain it and in ili addition charge 10 per cent interest if there is any rivalry aunon among g the different societies you will labor under some sonie ap apparent pare ut disadvantage ta L as others may show s h w larger gains gains during a certain time but this a vantage advantage is id only apparent and not real but jud it is hardly necessary to ti make these observations aarons I 1 because I 1 1 am sure from your lett iett letter ietter er that this matter i clear to you eroin froin the number of shares you intend lassu iasu ing I 1 presume they will be issued in series and if this is the case when you come colne to define the values of the shares in the different series it is necessary that you ou should start with the tile correct principle and uius ulus s save trouble and lanor the general er practice here is to elect a competent and responsible solicitor to ta look aftel legal matters who is paid by the members taking loans in real estate that is he hie draws up the nen necessary essary papers pe in connection with the loan makes all searches and sees that the society as well as the member is protected and for this service is paid by the individual u I 1 member of course the society whilst not directly Inte interested reste d ought to know that the charge is reasonable I 1 may sum up by saying that on the whole I 1 like your system or plan of working and have llave no doubt whatever of its ultimate success providing the majority of its members show the same interest inter pst as is manifest manliest od b by y you building societies will get along well under tinder any plau piau lau lan providing the right men take hold hoid and recognize the responsibility they assume and have the ability to banige manage its affairs properly this after all is the great secret there is so much that could be said of building societies the good they are arc doing and the laudable iau ian dable objects they have in view that after saying so much I 1 have really but touched the surface surf ace and must for formant want of time and perhaps for saying sayin some thiap that may not have interested you bring my letter to a close whilst my time is fully occupied as I 1 too am in the railroad business like yourself yet I 1 am always glad to respond ond as promptly as possible pos to such a letter ietter as you have written me because I 1 know that it ift is with the lau iau laudable habie hable object of bene fitting conr fellow men that you ou address me moe and w whilst sit I 1 may not te be of any particular service to you this fact does not detract from your object wishing your society that success which as I 1 have already ald said aid I 1 am confident it will attain I 1 am very truly yours THOMAS |