New-York tribune. [volume], August 19, 1921, Page 4, Image 4

About New-York tribune. [volume] (New York [N.Y.]) 1866-1924

Image provided by: Library of Congress, Washington, DC

                
Court Must
Unsnarl City
Debt Limit;
(Continued fron naje en?)
nenta and gave him 'from now until ?
toomsday to sustain then."
Mr. Craig began his side of the debt
Imit controversy with tho statement
?bat Mr. Brown has based his stand
hat the city was "overboard'' 0:1 the
following four assumptions:
That notes are debts and therefore
nust 09 charged against the debt limit.
Thnt special revenue bonds in one
roar?that is, at tho end of 1017?
k-ere outstanding in excess of the lim
tations place.; by the constitution.
Deductions Are (Questioned
That there was r.n insufficient deduc?
tion of the assets of tho waiter sinking
?und in arriving at the net debt as dis?
tinguished from the pros, debt.
That 5117.000,000. which had been ex
?mpted as the result of dock and rapid
ransit improvements could root be used
'or any other purpose savw docks and
:apid transit betterments, and that the
mu? thereof had to be dedhicted in ar?
riving at the debt margin as it is at
?resent.
Mr-. Brown here s^id he hid modi?
fied his views fis to the special revenue
bonds, and was in doubt* n* to tax
notes, and was willing lo strike out
these notes from his estimate of the
?mount the city had exceeded its debt
limit.
Mr. Cnaig then went into a long and
technical explanation in connection
rith the insufficient deduction of as
tcts from the water sinking ?und. in
listing that it was not necessary to
r.ake the deduction as had Mr. Brown.
Coming to the $117.000,000, he said the
money had long ago been used for
Hock and rrpid transit purposes and
should not be included in the debt
timit.
Mr. Brown took up th\e argument here
fry saying that the who?e matter was a
legal quesdon and that the deductions
ihould not lirve been made even at
the direction of the Appellate Division
in January 31, 1913, as the court had
tio jurisdiction, lie admit? d that his
iomp'aintavas against th? g%\T ng cf the
Appellate Division and T.:,;:inBt the
?anner in -which the subject had been
[?laced before the Appellate ??vision
by the city officials.
Comptroller Cites Law
Mr. Craifl: cited Section 10, Article 8.
?s the provision of the constitution un
?er which the money was excluded from
calculation of the debt limit and the
Jrround upon which the Appellate Di
rision acted. ,Mr. Brown insisted that
Dn the ground of tho same Section 10?
\rticle 8, the money should have
been counted in as part o?. the debt
limit and so send the city "overboard."
Mr. Craig, in, presenting this sec?
tion of the .aw for the record, said:
"After prescribing that the debt(
limit shall not etxreed 10 per cent of
the assessed valu..';on, and after cer-'
tain exceptions xcnich are not mate?
rial to this subject, the provision goes
on to state, 'Except, further, that any
Indebtedness heretofore incurred by
the city of New York for any rapid
transit or dock investment may be so
excluded proportionately to the extent
to which the current net revenue re?
ceived by such city therefrom 6hall
meet the interest and amortization in?
stallments thereof, provided that any
Increase in the debt incurring power
of the city of New York, which shall
result from the exclusion of the debts
heretofore, incurred shal be available
only for the acquisition or construction
of properties to be used for rapid tran?
sit or dock purposes.'
"Under that provision of the con?
stitution," added Mr. Craig, there wan
exempted in 1010 and subsequent years
in round figures a little less than *70,
000,000 of dock bonds and about $47.
000,000 of rapid bonds. That gives that,
total of $117,000,000. which you claim
^%?^^/k The Mortgage
^^^^^^ OnThisHotne?
^^a?lA?lL is for $4,500. It is held by a Brooklyn
5 0^^^0^?^^^" Trust Company, and is guaranteed
? ?? ? l'I^fei^^V t,y US at 5 '" ?"' ^ie Pr?f,crt>'' which
! -JlaL "T^''^Igj^tl^ *s *n r^at^usn? vvas purchased this
? ."%^W?f$'"s^^T''^ month by a lumber merchant for
n "?^^^^? ??_ ?v $9,750, over twice the amount of
JfL?*^ ,?m. ^--X the loan.
Mortgages on homes are the highest type of security. We have
j many such ready for immediate sale. We ?vil! be glad to show you
these homes, without obligation to you. There is no commission or
other expense to be paid by the investor. We guarantee the mort
, gages, absolutely.
Send for ?ooblet on Guaranteed Mortgages
HOME TITLE
IK'S URAN CE COMPANY
> BROOKLYN AND JAMAICA
T*"flsai ' '" - ??? - ?- "-. ?-mim iMMiiiTTi
could not be used for any other pur?
pose than dock ov rapid transit under
1 the constitution."
Authorizing of Bonds
"At the time that the debt statement
for July !. 1921, v/as compiled," went
: on Mr. Craig, "far in excess of $117,
000,000 bonds had been authorized for
: dock and rapid transit purposes, and
| on that basis the unencumbered debt
; margin- strictly speaking, the debt
limit on July 1 en that basis was
$183,590,054.01. But we always charge
against the actual legal debt limit any
; liabilities that we know are on the way.
"So that, making the deduction of ail
those items, which amounted to $46,
098,343.47, much of which has not been
spent yet, don't you see it left the un?
incumbered debt margin on July 1
$137,491,710.54, and I think that is the
thiny that there ought not to be any
question about."
Mr. Brown here began his reply, also
quoting Section 10, Article 8, of the
constitution, adding tho following ex?
cerpt from the provision by which tho
Appellate Division may exempt, moneys
from inclusion in the debt limit;
"The Legislature shall prescribe the
method by which atid the terms and
conditions under which the amount of
any debt to be so excluded shall be de
term ?tied, and no such debt shall be ex?
cluded except in accordance with the
determination ho prescribed. The Leg?
islature may in its discretion confer
appropriate jurisdiction on the Appel?
late Division of the Supreme Court in
the First Judicial District for the pur?
pose of determining the amount of any
debt to be so excluded."
Mr. Brown continued: "Now, there
lias been a misapprehension about the
purpose of this amendment, and 1 will
: tell you in my opinion what it is.
There is no such word as exempted
i bonds as applied to bonds of this char
! acter in the Constitution. They are
j excluded for a specific purpose, and
I for a specific purpose only. In the
cuse of future indebtedness the ex
! elusion or exemption is clear, and the
j deduction from the sum total of the
I debt unmistakable, permanent, unless
the investment becomes non-self-sus
j taining, and then it can no longer be
I deducted-"
"To that extent," broko in Mr. Craig.
Question of Restoration
: "Oh, 1 suppose if it became self-sus?
taining again it would be restored," ,
? rt'n': ?() Mr. Hrown.
?'Do you know of any way the da?!
!suli\..i., contracts couiu have been en- '
tered into CNcept by charging them :
against this $117,000,000?" asked Mr.
i Craig.
"Ko, but T know how the city could
have been relieved from an emuarraas
ment, namely, by making an investment
which was self-sustaining ?that waa the
. iota! excluded, and they ought riot to
i do it."
"Well, that was because the people
| wanted subways, and the Interborough,
i that had contracts for existing lines
; was too strong for any other kind of a
; contract, and the contract was made,"
' said the Comptroller.
"The city was not compelled to issue
a non-self-sustaining enterprise."
"Well, let us get it clear. It is ad?
mitted now that the dual contracts
No. 3 and No. 4 could not have been
entered into unless they were charged
against this $117,000,000 exemption; we
are agreed on that?" was Mr. Cralg's
query.
"Absolutely," replied Mr. Brown.
"They are bound to be illegal, if what
you claim is true."
The Summer Beverage "Par Excellence"
it's So Refreshing. JUST TRY IT!
' 111 ' umvm mwmmmimmmm'i? mm
* ' The mighty Olympic has carried a greater number
fof distinguished passengers to and from Europe this
summer than ever before.
To thousands of travelers, she has given a new
revelation of delightful living aboard ship.
With her luxurious, accommodations, magnificent
and spacious public rooms, long sweeps of deck, a
swimming pool and gymnasium and her unexcelled
White Star service, the Olympic represents the ulti?
mate in comfort at sea*
Splendid accommodations are available for sailings
from New York to Cherbourg and Southampton
September 3, September 24 and October 15.
The White Star, Red Star and American Lines
operate the following passenger services with fre?
quent sailings:
RED STAR LINE
Kvw York t? Plymouth,
Cbarbour?-. Antwerp
LEYLAND LINB
Bo?ton to Liverpool
Na'wOrlear,? to Liverpool
WHITE STAR
Nrw York and Roaton to Atorra,
Gibraltar, Naplei and Oenoj
Philadelphia to Liverpool"
Lwurvinut Winter Cruise*
to the Welt Indirt.
Write for details.
AMERICAN LINB
New York to Hamburg
via Cherbourg
WHITE STAR ?DOMINION
Montreal, Quebee to Liverpool
Bhort. scenic St. La wren ce rout?.
Only four day? at ira.
^white Star Line ts!
American Line v. ^?ujkA^ - V Red Star Lime
International Mercantile Marine Company
9 Broadway, New York
"I do not claim they are illegal."
. "Now, don't change you-- position,"
came back Mr. Craig.
"I am as firm as a rock," declared
Mr. Brown.
"Twice I asked you and twice you
answered that the subway contracts
?Nos. 3 and 4 could not have been en?
tered into unless they were charged
against thi:? debt exemption. Unless
this method of handling it is a valid
method of handling it and is a method
j sanctioned by the court of Appeals, the
i Court of Appeals never could have sus
; taiaed the contracte in the Admiralty
realty case," said .Mr. Craig.
?Subway Contracts Involved
To which Mr. Brown replied, "It is
not whether the contract is valid or
I not, but, having entered into that con?
tract and the city having spent $120,
I 000,000 for subways that were not self
i sustaining, whether the city has af
! fected its limit of debt for other pur
; poses. 1 say it would not have affected
I'ho city's debt limit if it had entered
into a contract for an enterprise which
I was self-sustaining."
"That $117,000.000 has been deducted
; in arriving at tho present debt margin
1 of $137,000,000," was Mr. Craig's re
i joinder.
"Yes, and should not have been."
"Should not have been?" the Comp?
troller queried.
"No."
"Well, then our debt margin would
be $204,000,000. Wo have actually
spent that $117,000,000 and a lot more,
and it has all been charged against the
debt margin, and we still have $137,
000,000 left," returned Mr. Craig.
"And you have credited yourself for
other purposes with $180,000,000 of in
j vestments made ?"
"You are in error, Senator."
"It was not expected," continued Mr.
Brown, "or intended by this constitu?
tional amendment to exclude the $120,
000,000 of a self-sustaining investment
theretofore made to enable the city to
invest $120,000,000 in a frozen credit
for docks or rapid transit."
"Senator, that is just a pure asser?
tion. There is no authority for it."
"You and I are both making asser?
tions."
"I notice in the order exempting them
by the Appellate Division, went on
Senator Brown, "that it is subject to
the provisions of Section 10 of Article
8, and when you read the provisions of
Section 10 of Article 8 in connection
with the fact that not a dollar has ever
gone into the Treasury of the City of
New York for those bonds you show a
complete lack of jurisdiction for the
purpose cf exempting them."
"This criticism is aimed at the Ap
-,--_ I
? pc?lato Division. It is not aimed at'
? anybody hereabouts now. That is cor- !
| rect."
City Officer? Scored
l
! Mr. Brown?Yes, and the officers of :
the city and the manner in which they
! presented it to the Appellate Division. I
"Senator, maybe your conclusion will !
also say that the contracts with thej
Interborough and the B. R. T. were '
illegal?" I
Mr. Brown?On the contrary, I think I
: they were legal.
"Wait a minute," came back Mr.
Craig. "They vero certainly against
appropriations that could not be made
except upon tho foundation of the
: Appellate Division action. If the Ap?
pellate Division is wrong that strikes
the whole foundation frofn it and
maybe to-day wo can get relief from
those contracts."
".Maybe.'?
"Maybe the committee will make a
| recommendation of that kind. My I
? suggest that it be considered?" was Mr.
! Craig's query.
"I will consider it. I think those
: questions are being considered by an
; other commission with plenary power."
Mr. Craig?W?iy, Senator, tho ef
I feet of what you say would be to ex
i parid '.he debt margin by $117,000,000.
I "I think in view of your criticism
j of the Appellate Division," Mr. Craig
I then added, "if you have any doubt of
' tlie validity of their action, it is your
duty to bring it to their attention
without any delay."
The tax limit issue wa3 taken up by
the Comptroller with a discussion of
s the meaning of the words, "last assess?
ment roll," contained in Article 3, Sac
j tion 10, of tho constitution, limiting
! tho tax to 2 per cent of the assessed
! valuation of real and personal prop
. erty.
D?finition of Assessment
It was Mr. Brown's contention that
the last assessment roll meant the roil
! of the preceding year, ar.d not those
: which are delivered to the Board of
I Aldermen on March 1 of the year in
which the tax rate is determined. The
Comptroller held that these assess?
ments are begun in October 1 of the
preceding year and could be consid?
eran the valuation of the previous year.
This was denied by Mr. Brown, who
said it was a matter of opinion and
legal decision.
"There is not the slightest doubt
about its legality," came back Crs'g.
"If I had had any doubts about it, the
tax would not have been levied at all."
The committee adjourned until next
Tuesday morning, when the Mayor will
oi.ee again take the stand, to be fol?
lowed later by the Comptroller again.
Senate to Favor House
Dye Curb to Save Time
WASHINGTON, Aug. IS.?The Senate!
Finance Committee completed ?fiarir.gs i
to-day on the chemical schedule d.' the ?
permanent tariff bill, amended the
House bill provision for an import
duty c-.i reimported war supplies sold
by this government to France, arid de?
cided to press for passage of the Hou.se
resolution extending the life of the
dye emhargo in the emergency tariff
act without urgir./ i t -^ own amendment
to continue the entire emergency law
to January 1.
The amendment affecting war sup?
plies would exempt from the TO per.
cent tariff voted by the House all such
stocks purchased prior to August 15.
One group of witnesses, seeking the
amendment, said their purchases
amounted to $30,000,000, but gave no
estimate of what shipments awaited
cargo space.
The decision of the committee not to
press its own amendment to the dye
embargo resolution -xas reached, mem?
bers explained, to avoid endless debate
and the delay of a conference with the
House so that the resolutions may be
passed before the proposed recess.
A Marmon 34 will be
sent to your office or
home and you will be
taken upon a demon?
stration that will give
you exact information
for comparing different
cars. Arrange now.
Mancon Automobile Co. of N.Y., Inc.,
13S0 Broadw*y-62d St., N. Y. City.
i'hone Colombus 5090
M?RMON 54
Tiffany & Co.
Fifth Avenue &- 37"n? Street
Fine China Plates
Minton, Grown S'l\ffordshire,Cauldon,Doulton
Crow Derby, Copeiand, Coalport and Lenox
CHARM and BEAUTY
in a white Enamel
depend upon its remaining pure white permanently;
arid on its ability to stand thorough cleaning.
S-W Old Dutch Enamel
"beats the Dutch" for a whiteness which is excep?
tionally pure and permanent. It also stands clean?
ing repeatedly and thoroughly for years. Made in
White, Ivory and French Gray; and in a rich gloss
or a soft, flat, velvety finish.
&uy iront y nor mearrest dealer*
Watch oar lizts for hut address.
FiEW YORK, no W?t 32 nd St. phonm Chola*. ?06
BROOKLYN. 102 FUtbush At?., pbon? Sterling 173?
BRONX. S59 East KSth Sit, char? M?lros* 0013
WHOLES ALB DEPT., ?16 We? 32 8?,
WAREHOUSE. 52 TltowtHH* S%.
?'
T pays to be careful about your gasoline?
to choose the best and stick to it*
"Socony Gasoline is made and tested by the most up-to
date refining and laboratory methods, with the fifty years'
experience of "Standard Oil" back of them. You can
depend upon its quality month in and month out. Clean,
pure, chock-full of power and mileage.
"If you want to get the most out of your car, always fill
up at a Socony pump."
STANDARD OIL CO. OF NEW YORK
26 Broadway