BOROUGH FINANCE.

Hauraki Plains Gazette, Volume XXXVI, Issue 4889, 12 October 1925, Page 2

BOROUGH FINANCE.

DELEGATION TO WELLINGTON.

REPORT ON ARRANGEMENTS. At the Paeroa Borough Council meeting on Thursday Last His Worship the Mayor (Mr W. Marshall) and Cr. P. E. Brenan, reported on their visit to Wellington in connection with borough financial matters. “In connection with the loan of £6OOO for sewerage improvement works .and the loan of £4.000 for street improvements which the council require to raise to cover amounts already expeded and which have been obtaied by overdraft from the Bank of New Zealad on the security of hypothecated debentures., we have to report that at the present time it is impossible to ob.tain any advances from the State Advances Department, and therefore no purpose can be served by waiting till a later date. Definite arrangements have therefore been made to obtain these .amounts from the Public Trustee for a term of 20 years at 6 per cent. This is the best rate at which the council can borrow at .the present time, and by obtaining the money from the Public Trustee there is practically no expense in raising the loan, there being neither brokerage nor exchange charges. “The rate of interest and .the. term of the loan are a departure from the authorisation, and a special Order-in-Council will be required to enable the

arrangements to be carried out. The necessary applications have been made for these. “The sinking fund will remain at 1 per cent, per annum, and as approximately 36% years are required at this rate to accumulate sufficient to meet the loan in 20 years’ time, but it ia a sound policy when paying a high rate of interest to have a short term. For this reason we have also applied for an Order-in-Council to raise the council chambens loan of £2OOO for a term of 20 years. “Concerning the balance of the street improvements loan of £62'50, which the council has decided to' ex-

pend, arrangements have been made pendig the raising of same to secure an .advance from the Bank of New Zealand by way of -overdraft on the * security of hypothecated debentures, This arrangement saves the council paying interest on any money not > actually expended, and represents a considerable saving in interest. “We ask that these arrangements be endoreed by the council and the necessary legal resolution passed to give effect to same,” On the motion of Or. Edwards the delegates were thanked for their efforts on behalf of the council.