OCR Interpretation

The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, February 07, 1925, Image 3

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Persistent link: https://chroniclingamerica.loc.gov/lccn/sn85042243/1925-02-07/ed-1/seq-3/

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Bank Legislation Pending
Introduced by Senator F. F. Babcock
No comment is made uncn the wisdom or oiV rwise of this resolution, but it is believed that the it to he submitted by initiative petition prepared b y some'person or group of persons having their own
jmyfr question involved is of such import arc« iK-i H must sooner or later be submitted to the people, interests uppermost. In the latter case it would have to be voted upon without opportunity for consid
and coofoding that the officers.of this association are of the opinion that it could be formulated and eration or amendment and in the exact language in which it might be prepared. Constituents grp re
submitted by the legislative assembly in such shape that if adopted, it would work the minimum of quested to. read the resolution carefully and communicate their views to their representatives and den
injury to any person and the pifliimmn of benefit to the unfortunate depositors rather than permit ators at Bismarck.
A Concurrent Resolution
For an Amendment to the Constitution, In
creasing the Debt Limit, Providing for the
Sale of Bonds to ProVide Funds to Liqui
date the Liabilities of Insolvent Banks, to
Levy Taxes to Pay the Principal and In
•terest of Said Bonds, to Provide for the Dis
busement of the Moneys Arising There
from, and to Protect the State in the Re
covery or Recoupment Thereof. /
BE IT RESOLVED by the Senate of the State
of North Dakota, the House of Represent
tives Concurring:
' That the following* proposed Amendment to
the Constitution of the State of North Dakota
is agreed to and that the same be submitted to
the qualified electors of the State for approval
or rejection, at a Special election to be held on
the fifth day of May, A. D. 1925, between the
hours of nine o'clock A. M. and six o'clock P.
M., in the manner provided by law for the call
ing, holding and certifying of special elections
for the amendment of the constitution.
The Constitution of the State of North Da
kota is hereby amended by the addition of the
following Article to-wit:
' 1. That in addition to all other indebted
x ness heretofore or hereafter authorized, the
State may contract debts not to exceed Ten
Million ($10,000,000.00) Dollars, and may issue
and sell its bonds in that amount for the pur
pose of providing funds to reimburse deposi
tors in state banks which may have been ad
judged insolvent prior to the first day of May,
A. D. 1925, and subsequent to the first day of
July A. D. 1921. ,
2, The State Treasurer is hereby directed
to prepare, and the Governor and the State
Treasurer are hereby directed to issue, negoti
able bonds of the State of North Dakota, in the
aggregate of said amount. They shall be exe
cuted by the Governor and the State Treasurer
linder the great seal of the State of North Da
kota, and shall be attested by the Secretary of
State. The, Auditor and the Secretary of State
shall endorse and sign upon each bond a certi
ficate showing that it is issued pursuant to law
and is within the debt limit. The bonds so is
sued shall be designated “BONDS OF NORTH
Said bonds shall be payable to the bearer, and
shall be subject to registration as provided by
law. They shall be issued in denominations of
One Thousand ($1000.00) Dollars, shall be
* dated on July Ist, 1925 and payable in thirty
(30) years from that date: They shall bear
interest at the rate of five per cent (5%) per
annum from that date, until maturity, payable
semi-annually on the first days of January and
July each year.
Such bonds have attached coupons evi
dencing the amount of interest payable on
each semi-annual period. Principal and in
terest shall be payable at the office of the State
Treasurer in the City of Bismarck. Bonds and
coupons must be presented for payment with
/ in six (6) years after maturity, and- no such
bonds and coupons shall bear interest after
, maturity, unless payment thereof shall not
have been made upon such presentation. Such
bonds shall be exempt from all State, County
and Mui>icipal taxes. The above conditions
shall be set out in the bonds.
North Dakota Bankers Association
i * v. : *ByW. fd MacFaddeni Secretary. Fargo, N. D. ■>' *
. / ...
3. Such bonds shall be sold by the BANK
OF NORTH DAKOTA at the highest obtain
able price and for not less than par and ac
crued interest, and at such times and in such
amounts as in the judgment of the Industrial
Commission shall be necessary to carry out the
provisions and intent of this amendment.
The proceeds arisingffrom the sale of such
bonds shall be covered into the State Treasur
ery and there kept in a fund to be designated
paid out and disbursed in the manner herein
after provided.
4. There is hereby levied upon and against
all of the taxable property within the State an
annual tax for each year, beginning with the
year 1925, and continuing until said bonds
shdll have been paid, sufficient to pay the in
terest upon said bonds and to create a sinking
maturity ,having Regard for the amount here
fund sufficient to retire the principal thereof ai;
inafter otherwise provided for—and it is here
by made the duty of the State Board of Equali
zation and such other officers or boards as may
be by law charged with such duty, to levy and
collect such taxes in the manner provided by
law, and to provide for the segregation and
safety thereof.
All moneys received by the State Treasurer
from the proceeds of' such taxes, and from all
other sources hereinafter provided for, or
from legislative appropriations or otherwise
made applicable to the payment of such bonds,
shall be by him kept in an account or fund dis
tinct from all other moneys, and shall be dis- *
bursed by him only for such purpose; and no
other disposition shall ever be made of such
money in said fund until such bonds shall be
fully paid, or unless there be a surplus in such
fund, but this shall not be construed as pre
. venting the State Treasurer from depositing
said funds in any depository designated by law
with respect to other public funds.
5. There is hereby appropriated all of the
money received as proceeds of the tax provid
ed for herein, and all other moneys received
from the other sources provided for herein, to
pay the interest and principal upon such
bonds, as payment thereof shall become due,
or shall be presented for payment, and when
ever any of said bonds or coupons thereon
shall become due and shall be presented for
payment, the State Treasurer shall pay the
same out of the. fund applicable thereto.
6. Whenever the amount in such fund
shall, in the judgment of the Industrial Com
mission, be sufficient to warrant doing so, it
may purchase any of such bonds which may be
in the market and for sale, at such price as
may be deemed by said Industrial commission
for the best interests of the State and bonds so
purchased shall be held as a part of said fund.
*7. That immediately upon the approval of
this resolution there shall be established in
for the audit and approval of the claims of de
positors in the insolvent banks hereinbefore
mentioned, and the officials of said BANK OF
NORTH DAKOTA shall establish and promul
gate rules and regulations for the auditing,
* approval and payment of such claims, subject
to the limitations herein provided for.
8. All'claims audited and allowed by the
Bureau herein provided for, shall then be sub
mitted to the STATE AUDITING BOARD and
by it audited, and upon its approval shall be
paid out of the fund created therefor, a#d in
the manner as other claims against the State
are paid.
9. The expense of administration shall be
charged to and paid out of the fund. v
10. No claim of any depositor, or the suc
cessor in interest of any depositor, shall be
paid in an amount exceeding Seventy-five per
cent of the principal thereof. No assignment
of any claim for the purpose of collection may
be recognized, unless made to the BANK OF
NORTH DAKOTA, and no assignment for
any purpose may be recognized for an amount
in excess of the sum paid therefor, proof of
such payments shall be made upon oath of the
assignee. No garnishment, levy upon execu
tion or attachment of other mense process
shall be sustained, nor recognized, nor shall
injunction or other order to prevent the dis
tribution of any part of said fund be recog
nized or permitted.
11. Depositors accepting payment of their
claims in the amount herein provided for shall
be forever barred from recovering any other
or further amount thereon from any other
12. The State of North Dakta shall immediately and au
tomatically be subrogated to all the rights of persons firms
or corporations whose claims may be paid out of said fund as
against the assets of the insolvent bank, the receivers and
stockholders, and in all such other funds herein provided for,
and it shall be the duty of the Attorney General to promptly
proceed to recover for the state upon such subrogation.
13. All moneys recovered by reason of or thru the pay
ment and assignment of such claims, shall be covered into the
State Treasury and by the State Treasurer credited to and
kept in the BANK LIQUIDATION FUND herein provided
for; the Industrial Commission or the Legislative Assembly
may from time to time transfer from said fund to other
funds of the State any excess there may be therein beyond
the amount necessary to pay the interest and at maturity, the
principal of all bonds herein provided for.
14. Nothing herein contained shall be held to limit the
exercise of the powers of the Courts as set forth by Senate
Bill No. 267 of the Legislative Session of 1923 (Chapter 137
Laws 1923) for the liquidation of the affairs of insolvent
banks, but immediately upon the taking effect of this amend
ment THE BANK OF NORTH DAKOTA shall be appointed
to supercede, and shall continue to supercede the Receiver of
all insolvent banks, and said THE BANK OF NORTH
DAKOTA is hereby authorized and empowered under the
supervision and direction of the court aforesaid, to perform
all the acts and things and assume all of the duties of such
Receiver, with the same authority and power such Receiver
now has or might have.
15. .This amendment shall in all things be held to be man
datory and self-executing, and in the absence of any necessary
administrative directions or regulations to carry out the pur
pose, spirit and intent hereof, the same shall be supplied by
the District Court of Burleigh County in the exercise of its
equity powers, and subject to the supervision of and review
by the Supreme Court of the State, as now provided by law.
16. That immediately upon the approval of this amend
ment, the GUARANTEE FUND COMMISSION as now con
stituted, shall cease its active duties, and all of the duties and
powers • now devolving upon and possessed by said GUAR
ANTEE FUND COMMISSION as provided by law, shall be
exercised and carried out by THE BANK OF NORTH DA
KOTA, and it may levy and collect from the solvent and oper
ating state banks within the State of North Dakota, such
moneys and assessments as are now being levied and collected
by said GUARANTEE FUND COMMISSION for the protec
tion of deposits, in the manner provided by law, until De
cember 31st, 1926; provided, however, that any money then in
the GUARANTEE FUND to an amount not exceeding $500,-
000.00, may be by the Legislative Assembly of the State of
North Dakota, or by the Industrial Commission, set aside as
a permanent fund to be used for such Jjrotective or adminis
trative purposes as may be by law provided with respect to
the control, regulation and operation of state banks; and pro
vided further that any excess over said $500,000.00 shall be
at once covered into the BANK LIQUIDATION FUND and
be disbursed as herein provided for. If at the time of
taking effect of this amendment there shall be Less than $500,-
000.00 in the GUARANTEE FUND there shall be transferred
thereto from the BANK LIQUIDATION FUND sufficient to
make the total amount $500,000.00.
17. That upon the adoption of this amendment the so
called “GUARANTEE FUND” shall thereafter be known as
the “Bank Protective Fund,” and the use of the words “Depos
itors Guarantee Fund,” “Depositors Guarantee Fund Commis
sion,” or equivalent words or indications, which would imply
that deposits in State Banks are insured by the state, or by
the Banks of the State, or by any department of the state,
shall be prohibited-
Referred to Committee on State Affairs.

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