LOANS TO LOCAL BODIES.

King Country Chronicle, Volume VII, Issue 521, 27 November 1912, Page 5

LOANS TO LOCAL BODIES.

INCREASED INTEREST KATE. A RETROSPECTIVE ADVANCE. [HY TKT.W.Ji.U'IT. I'IIKSS ASSOCIATION". J Dargaville, Tuesday. What appears to bo an extraordinary development; in connection with the loans to local bodies has just been brought under notice. The Borough Cuuncil applied for an instalment of ,£6OOO on account of the £20,000 loan which has been approved. The Advancs Office wired that payment had been delayed in consequence of tho amending Act of 11)111. A subsequent telegram from the Advances Office stated: "The amending Act, require* all moneys paid after passing of the Act to be at tho rate at which tho money was raised, pluw two .shillings and sixpence per cent, per annum administration expenses. Cannot say at present wnat rale will be. Act also requires a vrsolute v n by the local authority pledging il to pay the increased rate. The l'oria oi' resolution not yet gazetted. If your Council will give an|oini!ort;',!<ing to pnKii Ihe resolution to pay the increased rato and cancel debentures already signed for the amount to )»•• advanced, tho department, will :uilhoriso payment; of ,£1)00(1 on ae"o;m!." The money being urgently required to pay for contjacls in progress, tho Mayor, on behalf of the Council, gave the undertaking asked ior. The Council last, night, passed a resolution against the " unprecedented action" of (.he department ro tho charge for adnuniiilralioH expenses," and increasing the rales o! interest, also requesting the department to strictly comply with the, contract entered into between it and tho Council, that; the rate of interest bo £3 10s per cent, per annum with a sinking fund of XI 7s (id, tho loan being repayable in .'hi. 1 , years. Tho Council condemned tho alteration of terms on which the loan was agreed to by the ratepayers, the department over-riding the evicting agreement and making the increased rato retrospective.