BOROUGH LOAN PROPOSALS.

Gisborne Times, Volume XXVI, Issue 2315, 7 October 1908, Page 2

BOROUGH LOAN PROPOSALS.

FINANCE COMMITTEE’S REPORT. At tho mooting of tlio Borough Council last night the Finance .Committee submitted their report on the loan proposals, and a- financial statement prepared by the Town Clerk was also read. REPORT. TlieFinanceCommittee met on Monday, sth October, 1908, at 7.30 p.m., there being present the Mayor and Crs. Mann, Pettio, and Sheridan. Your Committee have to report that they have gone carefully into the financial aspect of the loan proposals, and the following is the position of each year’s expenditure. For the purposes of computation the revenue has been estimated on present day values. The result will bo, if present values unvaried, a rate of 2s 6.1(1 in £ after expenditure of loan of £52,000, or a rate, of 2s 4ld in £ after expenditure of loan of £41,390. it will bo seen by comparison that for the pasc five years it is found that tlie general rate collected amounted to £29,592, anil the expenditure upon streets to £29,648, practically the samo amount. Therefore it is evident that the general affairs of the borough could, outside of streets, be administered entirely from revenue independent of the general rate, which it can bo assumed is available for street requirements. Therefore your committee have not considered other items of revenue or expenditure.

LOAN PROPOSALS—£S2,OOO.

First year, 1909: Amount required "VVaimata Bridge £5060, recreation grounds £6150, machinery £3323, streets improvements £7600; total, £22,133. Interest on this amount will bo paid out of loan money, the amount required for street maintenance this year being £3876. Second year, 1910 Amount of street loan raised £7600. Interest on this to be paid out of loan, but interest will have to bo found oil tho £22,133, viz. £llO6, add for street maintenance £3876; total, £4,982. Third year, 1911: Amount of loan raised £7600. Interest on this will also be paid out of loan, but 5 per cent on £29,733 will have to be found £1,456, add for street maintenance £3876; totalling £5362. Fourth year, 1912: Amount of loan raised £7600. Outside of interest on this amount 5 per cent on £37,333 must be found £1866, add street maintenance £3876; total, £SL. 2. Fifth year, 1913: Balance of loan £7667. Outside of interest on balance paid out of loan 5 per cent oil £44,933 is required' £2247, add c'roet maintenance £3876 ; total £5742. Year 1914 and onwards: "Whole loan £52,600 expended. Interest required £2630, street maintenance £8911; total, 11,541.

LOAN PROPOSALS—£4I,39O.

First year: Part of loan required (including machinery £3323) £10,923. Interest paid out of loan, amount wanted for streets £3876. Second year; Amount of loan raised £7600. Besides interest out of loan 5 per cent on £10,923 is required £546, add street maintenance £3876; total, £4422. Third!.year: Loan raised £7600. Interest oil £18,523 required^£926, add street maintenance £3876; total, £4902. . Fourth year: Loan raised £7600. Interest on £26,123 £1306, add street maintenance £3876; total, £5182. Fifth year: Balance of loan £7667. Outside of interest on balance paid out of loan, interest on £33,723 at 5 per cent required £1686, add street maintenance £3876; total £5562. Sixth year and onwards: Whole loan £41,390 expended. Interest required £2069, street maintenance £8911; £10,980.

FINANCIAL STATEMENT.

Upon comparison for the past- five years it is found that the general rate collected amounted to £29,392, and the expenditure upon streets to £29,648, practically the same amount. Therefore it is evident that the general affairs of the borough could, outside of streets, be administered entirely from revenue independent of the general rate, which it can bo assumed is available for street requirements. The average yearly increase in valuation for the past/three years has been £7900, the value in 1908 being £91,500, and in 1904 £52,000, therefore if .for the next ton years it is put down, say, at £SOOO per annum, it should l be on the safe side, making an annual rate of 2s on this basis, it would leave the position thus: Year 1909, amount of rate £9500 (say first instalment of loan £15,000 taken up, £750 interest would bo paid out of loan) full amount of £9500 available for street maintenance. Year 1910, rate £IO,OOO (another £15,000 of loan money expended, £ISOO interest paid out of loan, full rate again available for expenditure. Year 1911, rate £10,650 (balance of loan £12,600 expended), £2630 interest would have to be taken from rate, leaving £BO2O for street maintenance. next year there would be another £SOO to aid for expenditure on streets, viz., £8530. This £SOO can now bo added each year during term winding up with a rate in 1917 of £13,650, less interest £2630, leaving £11,020 for street requirements. The Mayor said that perhaps it would he better to take each head of the report separately. To that effect he would move that the Council agree to the loan for street work of £41,309. The matter had been referred twice to the Finance and Works Committees and fully thrashed out, and both t'he committees had raised the amount originally mentioned. The rate would be 2s while the money was being expended, and afterwards on iwesent valuations the rate would be 2s 4|d. Cr. Sheridan seconded the motion, and said that ho was in favor of letting the question go to the ratepayers.

Cr. Bright said the whole of the Council had done good work in reviewing tho question. The report was more in keeping with his own views. He did not think the work of the Council had been wasted, hut thought the ratepayers had a. right to look to tho Council for guidance as to whether the time was opportune or not. Tho whole country was laboring under a state of financial stringency. He moved the following amendment —“That in view of the report of the Finance Committee, and in view of the present financial position of the country, no further steps be taken for the present in placing the loan liroposals before tho rateuavers.” Cr. Mann seconded the amendment. Cr. Darton said ho would have preferred to lnve seen a resolution that some loan proposals be put before the. ratepayers. It now appeared that the raising of ,a loan would raise the rates from Is 10d to 2s 6d. He did not ''think, in view of the drainage proposals, it would be wise to ask the ratepayers at the present time to increase their rates. He also pointed out that the maintenance was an increasing amount, and the rates would he correspondingly increased. Only ten miles of the work was permanent, and the other 30 miles temporary. In a few years they would want to renew the expenditure. He would like a proposal for a loan for some permanent work, with a reduction in maintenance. Cr. Pettie snoke in a similar strain. He thought if they got a loan of £30,000 for permanent work they would be doing good work, but it would be necessary tlion to set aside £SOOO or £6OOO out of the revenuo for the maintenance of other works. He thought they could spend a fairly large amount without increasing their rates. He quoted figures at length in sunndrt of his argument, and was strongly in favor of the spending of any money on' permanent works. If they nut a proposal before the people that was going to raise the rates from Is lOd to 2 S 6d they had no chance of getting such proposals passed. He could not vote for the amendment, as lie would like to see some forward move made an the matter. Cr. "Williams said lie thought there was a great deal in what Cr. Bright had said regirding the time being .inopportune to'borrow money. Tie would like to see something done ill the matter, but was utterly opposed to any temporary or patching work being done out of the loan money.

I Ho thou gilt they would bo wits or' to borrow money to do permanent work i:i tlio main streets, an'd in the incuntimo leave out tlio outlying streets. While not altogether opposing tlio proposals,, ho still could not vote for tlio amendment. Or. Wliiimiy felt undocided on the question, but could not shut his eyes to the matter of tlio amendment. The time was certainly not opportune for borrowing, and ho would like to see the matter left in abeyance for the time being. Cr. iSomorvoll also thought that tlio drainage projiosals should bo placed before the r itepayers as well as tlio loan proposals. Ho was in favor of doing only jiormanont works from loan money. Cr. Sheridan said that the annual maintenance would not bo increased, lie thought they wore taking an extreme view in going oil tlio basis of present values. The worst that could happen would he a rate of 4s 4id for drainage, water, and general. He hoped the proposals would be put before’the ratepayers. The Mayor congratulated the councillors on the way that they had received tlio ‘loan proposals, lie said it had practically come to a question of whether it was ail opportune time for borrowing or not. 'J.'he financial stringency showed a great roison why the Council should go in for the loan proposals, as otherwise they would bo compelled to increase the rates. They- were right up to their limit, and with flic altered conditions in the noxt five years they would have a saving of .£19,461. They had got to x practical point, and ‘it should be dealt with and referred to the ratepayers, and if they threw it out lie would be content. If they did not send it to the ratepayers they would clearly bo failing in tlieir duty. Cr. Bright’s amendment, on being put to the meeting, was lost by five to three. Cr. Dalton moved an amendment.— “That this Council place before the ratepayers a proposal to borrow £2/3,000 for expenditure on the purchase of machinery and formation of roads and footpaths; only permanent works to be constructed out of loan moneys.” , This amendment lapsed for want of a seconder. Cr. Williams moved as a further amendment. —“That this Council, having now full information before them with regard to the proposed loan for street improvements, etc., the whole matter be allowed to stand over till the question of drainage has been considered and a decision arrived at as to what sum it is desirable to borrow for that purpose.” Cr. Somervell seconded tlio amendment. After. .considerable discussion, Cr. Williams’ amendment was then put -o the meeting and lost. Cr. Fright wished to move another amend ..lent, but tlio Mayor ruled him out of order. Cr. Bright: Then I might as well go home. Cr. Mann protested strongly against the ruling. A councillor could move six amendments or more if lie wished. Cr. Bright was about to withdraw from the meeting, but remained while the rule was referred to. The Mayor said that all rules of debate forbade any person from moving a second amendment. As there was no special rule dealing with the matter, and if it was the wish of the Council he would allow Cr. Bright to move a further amendment. Cr. Bright: Ido not want it as a favor—but as a right. Cr. Bright then moved as a further amendment —“That the proposal to borrow £41,000 for street improvements bo deferred until the schedule of the'specific works to be undertaken is prepared.” Cr. Darton seconded the motion. Afler further discussion. Cr. Bright’s amendment was put to the meeting and lost. Tlio original motion was then put a ltd ca vried. The Mayor then moved —“That a separate poll be takmi on the question of recreation grounds. Cr. Sawyer seconded the motion, and Cr. Mann supported it. Cr. Sheridan spoke against the motion. The proposal was carried. The amount for the Waimata bridge was then put by the Mayor, and lapsed for avant of a seconder.