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IRV e IOBOO (P el - e FBoemelT 2 - s o \nw THE CHICAGO TRIBUNE: SUNDAY. FEBRUARY 10, 1878—SIXTEEN PAGES. 3 e Supreme Court Decision on Certificates of Indebt- edness. “Th Text of the Majority and Mi- i nority Opinions of the Court. Officers as Yet Unwilling to Say Anything on the Subject. A1 Doclare that the Outstand- ing Oertificates Will All Be Paid, "Bt fhe Finance Committee Talk -Over the Matter of Reducing Expenses. Opinion Regarding {he. Detision—What ¢ ot {be Bankers Have to Sav CITY CERTIFICATES. TAE SCPREME COURT DECISION. The all-sbsorbing subject of discussion ai the Gity-Hall, smong the city employes every- where, amone citizens, and among corporatioas ‘polding certificates of 1debtedness, was the Sacelon rendered by the Supreme Court fu the e of Law vs. Huck, an abstract :whm was given in yesterday’s ‘fmrn- rse. 1t was koown that the decision . 1n question declared absolutely void the certif- cates fssued unaer the Colvin-Rayes Adminis- trgion, being those prior to 1576, but it was pot known esactly how far it ioterfered with {hose waich have been Issued since that time under the decision made by Judge McAllister 12 47, 1576, or how fur this decision would in- ferfere with the city’s auticipating its revenues, orthe raising of money for the purpose of pay- jor expenses up to the time of the collection of jts taxes. Even after acopy of the important document had been received and had been pon- gered over by those immediately interested, it issome little tune before they could thor- {uehly digest it and appreciate its gravity and eextent to which jt went. The two opin- fone—majority aud minority—and the views of éty officers and others regarding them will be toand below. THE MAJORITY. . JUDGE WALEER. The following is the majority op inion: THE FACTS. are that the bonded indebtedness of the fi]-.;'vyrwmugu Das at all times since the adoption of our present Conetitution been more thand per ezt o0 the asseseed value of the taxable property jothe city, a8 aecertained from State and county lanstion. And it further ppears, that, notiwith- fiing sach bonded {ndebtednees, the city has £sch ear eince 1872, if not before thac time, {s- §2ed certificatea of indebtedness for temporars Jouzs besring futerest mtended to de paid oat of Derevenue lovied for the current year, snd upon ¥hich money was loaned to and used by the city to et the expensct of its Fovernment. Onthe 10:h day of August, 1875 the city, by or- tinwee, Tevied in detail various sumsto meet the expenses of the varions departmenta of the City Gorerament, amounting in the aggresate to §5,- 121005.29, Teciting that 1t was the total amount efsyorapriations made previously for the purpose foweordance withthe law. It appearsthat among the fems thus spproriated and levied there are a nom- ber for inlercst on temporary loame. One U for paymeni of interest on genmeral dnded (@uuicipal) dobr of the city, ~and @ temporary loans in sdditton to the un- fipenaed. balance Abril 1, 1875, and to amounts fitinserest, $300,000; another, for entertaining oftia] visitore, $2,000; for interest on temporary fotus for the (water) fund, $40,000; for interest mtemporary loas for .'ir¢ Department, $25,000; for interces on temporary loans (Police Depart- £, $25,000. These ainounts were respectively Jvied in pursuance to an ordinance which bad been adopted on the 30th of June, 1875, making the several appropriations for the purposcs named. Itappears that there were ontstanding on the 1st of Aprll. 1875, certificates for temporary loans is- med afer the Constitution went into effect, and belore * that $3,000,000 or more; that o the 3lst of December, 1873, the tetificates for temporary _ loans, and then ontetanding, smounted 10 $4,500,000; and the eridence shows the item of $300,000 appropristed +10d levied 2 before stated was for interest on tho bmced dsbt and on temporary losns then out- £anding, and for the former the sum of §251,310, sudthe remainder to meet interest on temporary IT 1S INSISTED 1hatall of the firet jtem levied for interest on tem- porary loans is void, and that all of thic other items tbove specified weré levied without any suthority. Toat the city bad Dot only no power, but is ex- presly prohibited by the Constitution and their darter from majang these loans, as the city was o the time indebted beyond the constitutional Imit when the debts were incurred to pay the in- zreet for which this levy was made. ~That, the &b being fllezal and_void, the city had no power 1 lovy a tax 1o pay interest on o void debt, and the 1ax cangot be ecforced. ~The constitutional Forision supposed to be violated is the frst clause dthe twelfth section of Art IX., and is this: 3o county, clty, township. school distriet, or other SETa? Cirporaiton shall be. ilowed o bicome - Ehica In ahy Inaaner or fur suy purpose to an amount, Leinging existing {odebtednes:, in the JgEresate ex- eedlng 5 per centon Lhe value of the ta¥able roperty therein, to be ascertained by the Jast asscasment for €uateand county taxes previous to the Incurring of axchindebledness. The language of this clanse is clear, explicit, acd emphatic that no city shall be allowed to be- come indebted in any manner or for any purpose besond the limited amont. The City of Chicago wes indebted beyond tuc limited amount when these certificates were {ksued, and if they in any nawver or {rom any purpose Create an aaditionul ndedtedness they are clearly prohibited. The unuace proubiting indebtedness beyond the #inltid €0 piain as to admit of no doubt, aud for- bide &) conetruction, and the provision must be enfored as it i written. « ,\hen the intention of the framers of the Con- Mitution {¢ ascertained, it muet, as all will con- gede, be held paramount 1o a!l other powers in the &ute. 1t embodics the sovereirn power of the State, by virtue of which, and by which alone, 2l legislative, executive, sud judicial power Lsexercised. It is the source to which_all of the Cepartments of Governmentand all its ofiicers mut ultimately lovk to suthorize or sustain their offiealacts. 1t not only confers power, but it also ita iis exercise. Pl probibition timits the power of the General enbly, the municipality, and ail others in the » erealion ‘of indebtedness by such bodlesto the 30wt named, and they canuot_either separately €rcjointiy transcend that limit. 1515 the com- Tund of the supreme power of the State, and most obeyed. Kor isthere lodged in onr form of &oterument sny. authoiity to dispense with its Protitions or requirements, but to them all, wheth- & oflcers or people, must ' yield obedience. The rts muet therefore enforce its provisions and uirements as they are found. eIzt aiso been repeatedly held, and is regarded Haetiled doctrine, that all negative or prohiditory 1465 of this character fonnd in the fundamentsi jiv Sxecule themselvee, a3 legisiative provis- i in the eame or otherterms prohibiting the pjrating scch indebtedness could be no_ mare ingor forcible than the Constitutfon itself. Gener] Assembly might add a eection 1o the {iovision by amposing penalties snd forfeitures on oeewho should violate its provisions, Lut that II:‘: ?nl?nd nom force 1"1’;&“"" pmhfllman.‘ Such 'Y enactmey Ve its vi et noting mmm might prevent its violation, e DID THESE CERTIFICATES, semed to procure temporary loane, in 30y manner *or any purpose create an indebtedness? _When doueq, Degotiated, and desivered, aid they become thist That they were, scems to be so plain a gfflmflflnn that we zrceralossto know how to moussitor renderit more manifest than by o ere statement of the proposition. We apprehend Th theee certificates, SL‘IIH:E that the city owes dl{l holder the snm 'named. and promising or QB the <~ Tressurer to pay it 2 time named, are debts roondiag to the definition of any English lexicog- Pher, and we apprehend that smong the people {bone, according 10 the gencral understsnding of demord, would ay they were not evidence of in- tednets by the aity, ~Nor could the framers of o aw have intended 1o use the_term in Gagpnense tlat the sum wmust be du to be an in- fonedaess. 35 that would huve created no limita- don ¥hatever, es such debis are seldom, if ever, ognien they azc created. To 6o hold Would ab- {oeate this provieion, and wholly defeat the inten- o2 of the framers of that section, and of the peo- B dopting 1t would render the eflect to dopt Gtx and municinal indebtedneas futile, and . gofeat the supreme will of the State thus clearly 2uddeliberatelr expressed. ut 1t 15 eaid that it will, to <o hold, £ading WORK GREAT HARDSHIP fod injustice on the holders of these certificates of s ces. The same may be frequently said o 808 other persun wwho violates the oo 2T Goes " acls contrary to s Rgrjons.. The persons loaning this mopey 20 5,0 the facc of this constitutional provision, 3o the £1th claus¢ of the 62d cction of the chap- Tritited - Citice, Villagee, and Towns * (. S gl 216), which expressiy probibite such i ‘eeaness. Sueh municipal bodies can only ex- bty 20¢h pawers as are conferred upon them by tter. 2nd oll persons dealing with them d to ece that they have power to per- Sags proposed act. Sorporations are created for fovernmental (1 2 e e and not for commercial purposes. And hence no power to borrow money is incident {o the perform- ance of the duties their charters impose, and it 15 by grant of power only they can create’ debts, and 10 one has the right to presume the existence of such power, and perons proposing to loan monoy toa city should e that there is such power. d Audaf the holders of these certificates omitted to 00, when they loaned thelr moncy. it was their own fault. The constitutional and statutory probibition from incurring euch indebted- ness i3 g0 plain that we cannot Euppoge that men of ordinary business intelligence could, had they read it, have failed tosee that such indebtedness \as uneguivocally prohibited when the limit ¢hould be reached, and they could before Dparting with their money have casily learned tnat 3t had been passed for years. Lut even if it should work o hardship to individs uale, that cannot form the slightest reason for vio- lating a clear provision of the Constitution, ar for wholly perverting its languuge from its meaning to afford relief. Nor is there any force in the consid~ eration thiat it will occasion inconvenience to the gity ofiicials in conforming to the requiremcnt. ‘They can only exercise the powers granted to them by tnelr chirter snd regulated by ordimance. Neither the city nor its officials have any Inberent power in governing the city. 1t fs all delegated and limited by the charter and ordinauces adopted to carry such delegnted power into effect. And the question with us and the city authoritics {s not, What would be the most suitable powers to be conferred? but What have been con- ferred? The people, through their representa- tives, are thesole judgesof what power shall be granted, what withlield, 2ud what prohibited from being exercieed. and that when legally expressed must be obeyed by courts and municipalities most certainly in its fall spirit_and meaning. The con- stitution ana_charter must be enforced, although it way occusion inconvenience in conformingto their requirements, “These certiflcates, then. befng evidence of debts, and the city baving' before their issue reached tho limit created by the constitution and ite charter to incor more indebtedness, there was no power to levy a tax or make an_appropriation for their pay- medt. And the debt having been made, and the certificates issued in direct violation of law, they were void, and being g, they could draw no {nter- est, and if they did, it would be equally void with the principal, and tne levy of a tix or an appropriation for the payment of the interest is us efectually pro- hibited a8 to incur or pay the principaldebt. The interest 6 as much a debt ns the sum borrowed, and i no more lawful or bind- ing, Itthen follows, the sppropriution and levy of this tax to pay ‘nterest on these temporary loans were void and ean have no fegal ellect. But it is claymed that this is but ANTICIPATING THE REVENUE aiready levied and to be collected, and these loans are, therofore, not indebtedness. ~They purport to bind the city for their payment, and have all the form of an Indebtedness. And if from any caueo they should not be discharged from the tax then levied, the lender wauld, 1f not prohibited by law, cxpuct and claim that hé be paid by the city from soine other source. When tac attempt was made to create these debts we must sapposc the city of- Acials expected to pay the money nowwithstanding the prohibition of the Constitution snd thelr charter, and the lender, if he knew, as he is pre- sumed fo have known, of the prohibition, expected to receive payment. This 13 notan _anticipation of the revenue pro- vided. Itismorc than that, It is indebtedness to be paid from such revenue if collected, and, if not, then from other revenue. The manucr of ‘augici- pating revenue already levied was _before usand Tuily considered, n the casc of the City of Spring- fleld va. Edwards (84111, 620), and on the able arsuments flied in this Case we sce no reason to change the rule then announced. The questions are cascutlally the same in the two cages, and that must govern ihis, on this s well as the other con- stitutional questions. The Court below therefore crred in rendering judzment for the tax levied o meet the intereston these temporary loxns. We Liave not been reterreq o, nor have we found auy other provision of the Constitution shich has in the shightest degree limited or qualified the first clanee, unless it be the last clause of the tection \which authorizes these bodies 10 issue bonds in com- plunce with any vole of the people hnd before the adoption of the Constitution, in pursuance of law providing therefor. In the consideration of this quesifon, we_ have, as the rules of inter- pretation require, given the language its plain, Common, 3nd well-ascertained and well-known meaning. We have no aathority to give 1 any ather. Nor are there temporars loans sanctioned by the case of SPRINGFIELD VS, EDWARDS, supra, as bere thesc certificates of indebtedness are held as claime againt the city, and the city i3 levying taxes to poy the intercst on them; and the debt of the city is ehown to bave been increased Dby these certificates to the extent of §1,500,000 from the 1stof April till the dlstof Décember, 1875. In Springfield vs. Edwards, eupra, it was held that after the tax was levied the city might anticipate it by drawing againet it, if the person performing 1200t or farnishing articles o the City yould receive the warrant in discharge of all lia- bility on the part of the city, and look alone to the oficers abd not to the city for payment. That a_city could not thus make a debt aud call it anticipating the taxes already Jevied. That the warrant hus jseucd must be re- ceived in full for the labor performed or articles furnished, aund, if not pxid, the city incurred no Tiability. ' That it was al the risk of the person re- ceiving the warrant. Whilst n the case at bar, the city is endeavoring to recognize and pay at jeast the inlerest on certifcates_ thus lssucd, thos en- deavoring o create indebtedness beyond the limit prescribed. The liability to pay interest, on such warranis 15 not a discharge of the city, and looking alone to an ¥iiicer, but it is looking to the city at Ieast for its payment. When the constitutionsl Iimit has been resched, and a corporarion then 13sucs bonds, certificates, or other inetruments drawing intercst, and are in form evidence of indebtedness in addition to the limited nmount, We must presume they are pro- hibjted and_void, and if such instruments muay, under any clrcumttances, be lawfully issucd, it must devolve on the corporation 1o cetsblish the fact, In this case fho_proof shows that the limit had ‘Deen reached before these certlfcates of indebred- ness were issued, and the city hus ehown nothing 10 osercome the presuiaotion hat ey ore anau: thorized &nd vois The other question presented by the record is, whether the city has the power to provide a fund Dby the levy of a fax to ENTERTAIN OFFICIAL VISITORS who might come 1o the city. There 1 no ciaim {hiat it is expressly authorlzed by the charter under which the city is now actinz. But it is claimed that the amendatory act of the former charter, ap- proved March 9, 1867 (Vol. 1., Private Laws, 771 confers the power. And fhat as that provision i not inconsistent with the present charter by force of the elxth section of the cherter, the power may be exercised. That section provides that all lawa and parts of Iaws not inconsistent with the zeneral Iaw sball continae in force and be applicabie to any citv or villige adopting the gen- eral law, the gsme as though the change of organlzation had not taken place. I, then, that provieion inconsistent with the provisions of the charterf The sixty-second section of the Gen- cral law bos In the most ample and speciiic man- ner defined the powers of the city. It is so full ana definite that there wonld seem o be no room 10 donbt that the General Assembly intended such bodics to cxercise no other power than those granted by that section. \Whilst the General law doce not in terms probibit the exercise of the powet, it does in spint. When that section eays such orzunization **shail have the following pow- ers,” it by strong 1mplication prohivits or denivs the exercise of other nowers. When the city was authorized fo exercise the powers and_perform tbe duties imposed by the sixty-second section of the charter, it by implica- tion conferred the power to levy and col- Ject revenne mecessary to carry out those powers. And the Illth section of ~the Bet provides that the City Council may assoss and collect taxes for corporate purposes in the following manner: *‘The Comncil . . . shall, on or before the second Taesday fn Septem- ber (August) in each year, ascertain the total smount of appropriations for all corporate pur- poses legally made ana to be collccted from the tax Jevs of tat fiscal year, and by ordinance levy and asseax such amonnt o0 ascertained upon the real and pereonal property within the city . . . subject fo tasations as the same 18 assessed for Statc and county purposes for the current year. "I'his section anthorizes the levy of taxes for cor- porate purposes and legally appropristed. In hat manner shall we ascoriain whether the tax 18 for 4 corporate purpose? Manifeatly by turning to that portion of the charter which confers the pow- er to perform dutics and exercise powers. 1f the tar js necessary to carry out amy of these powers, of to perform any of these dutles, then it s for & corporate purpose. If the appropriation is to enable the Gity to discharze any of these duties or to exereise any of these powers, then it {8 lezally made. i the appropriation is made or the tax levied for come other ar diferent purpose, then the Sppro- priation is iliegal, and there is no powerto levy Ench a 1ax. i A The leryof & fax toraisca fand to entertain official visitors is not one of the powers granted Dy the sisty-second section of thecharter. and as its cerciee is repugnant to tie CXPress pawers grant- d, the scction of the old charter under considera- tion cannot be held toue apartof the present Charter. Aunicipal corporationa can only exercise euch powers s arc conferred upon theg by thc Geueral Assembly; and the grantof plwer must be cxpress or from implication, from the ne- Ccessity of ite oxercise to carry out 2ome power that Rae been expressly cranted. * Tiae power contended foris mot granted, nor is ita cxercise esseatial to carry ont any other power. We are of the opinlon that this section, in spirit, conflicts with the pro- vigions of the present charter. < 1t is urced that the ordinance making the appro- pristions for the varions parpozs for the fiecal vear {8 voud. because in its tile is ueed the word ‘‘common” instead of the word **eity, ™ as prescribed by the present charter. When this ordinance was adopted there had been 1> election held after the adoption of tl.» present charter, and the Councilmen undet the old cuarter were still performing the duties devolved on tne YLegislative Department of the City Governinent, and 1t may be that body was etill the Common Conncil nntil mew Aldermen ehould be elected. And if so, then the title was strictly correct. Iiut be this as it may, the Lwo terms are 8o_nearly pre- cieely the eame 1n meaning, that we regard it immaterial which term _was used in such an_ ordinsnce. Even if - the Word **city” ehould tecanically have been nsed, the adoption of the lanzuage ** Common Council \ould not be grounds for reversinz this judgment. “The other questions presentod by this record have been discussed by my brother Scotr, and I n from thelr discussion. 5 T a1 but the city taxes, we perceive no orror 1n'the jaaement, and, as to them. the Judgment is afirmed. DBut, for the errors indicated a8 1o the 6. the judgment is reversed and the cause ‘rig:l:;cd. thaé the Court below mas. iender judg- ment for the correct amonnt of the city taxes, after dedactiog the portion illegally leried s sbove in- licated. Judgment afirmed In part and reversed in part. THE MINORITY. JUDGE ECOTT. The following minority opinion, though long, fs yet of value, since it aids to interpret the views of the majority of the Court, and,ifa rehearing be granted, the sentiments here enun- ciated mey become the law.] After sustalnine, es in previous decislons, the State Board of Equalization and its manner of making the sssessment, the Judge says: Among the taxes conterted ia ono levied upon property in the City of Chicago to mect an appro- priation made by ordinanco to pay interest on what are termed **temporary loans,” and _that, it is said, Is illcgal, It may be assumed as proven the appropriations made were for the payment of {utereston_temporary loans for the fiscal year from April 1, 1875, to A%fll 1, 1876, and being the fiscal year for which the taxes contested were levied, The Comptroller Is positive iu his state- ment the Aporopriation ordinance contains no propriation for interest on temporary loans ior fothat date. Elaborate c:guments have been mwade on fhin_ branch of the case, ond the dificult questions ralsed have been the subject of mnch discussion and reflection on the part of the Court. The restriction upon the power of municipalities to contract in- deutednes is contained in the flrst clause of Sec. 12, Art. IX. of the Constitution. Prior to the agoption of the present Constitution, the funded dent of the City of Chicago exceeded the limita- tion fixed by that instrument, and has not since peen reduced, Therels alto what Is called a float- 1ing indebtedaess of many thousand dollars in addi- tion to the bonded indebtodnese, much of which, if not all, has been contracted since the adoption of the Constitution, but the amount of that in- dabtedness, and when contracted, are uot in my view matters that aflect the decisions of the ques- tions made. The direct question comes up for decision, Can a wanicipal corporution, the indebt- edness of which exceeds the constitutional limita- tion, anticipile the taxes levied for ¢ any current year, 80 ns to make them avail- able for’ that iscal year! The limitations imposcd by the Constitution in such matters as we are considering should be construcd with refer- ence (o exlsting facts, and with a view to the prac- tical working of tuat instrument. Buch literal coustruction should not be adobted 23 would de- feat the object to be attained. 1t was no doubt the purpose in framing the Constitution to afford prolection to municipal corporations. They con- stitute elicient]aids to government thal cannot well bo dispensed with.” Self-preservation is a right inherent in_cverything capanle of exerclaing it, and may be sald 1o pertaln to artificial as well as natural persons. Unless pronivited by positive Iaw, » municipal corporation may do ull things fairly within the scope of powers conferred to ac- complish tie purpose for Which it was created. Only general powers can be conferred upon municipal corporations, " and from that source must be inferred all necessary power to render practicable that which s “conferred by thegeneral tecms employed. - Express authority i3 given to do anything for the protection of the life and property of the citizen,and with that grant. of power must necesgarily be connccted authority to provide for the expenses attendant upon the maintenzuce of municipal government; otherwise tno grantof power, however comprehensive, wonld De valoeless and unavailing. The taxes levica for uny year should be for the expenses of that fiseal year. Unless SUCH TAXES CAN BE ANTICIPATED IN SOME MODE, 1t is not practicable to make them avallable for that purpose. Its 3 matter of which courts must take judicial notice, and taxes levied forany ane year are scldom if ever all collected within that fiseal year. Accordingly, when appropriations for ordinary expenscs have been mude, and taxes levied 10 meet the same, the revenne so appro- priated inlegal contemplation is regarded as already n the treasury of the corporation imposing such taxes. The principle 18 thut when taxes bave been levicd to meat Juwiul appropriations the corporate authorities may proceed with the espenditure of suct funds for the purnoses for which the levies were made in suticipation of their collection. This view of the law has been distinctly recognized by this Court in Newell's case, §0 111.,” 592. Other courts, where the Constitutions of the Scites con- tain provisions similar, if not identical with our own as to Jimitations ipon contracting municipal indebtedness, have reached the same conclusion, Grant vs. Cify of Davenport, 36 la., 390; People ve. Pachee, 27 Cal., 175; State ve. Maberry, 7 Oblo Siate K., nolds vs. Mayor.” 13 Louisiana Annusl, 428, Appropriations for ordi- mary municipal expenses may be made in anticipa~ tion of taxes levied in uny year, snd contracts payable out of such uppropristions when the tevenue shall be collected are not re- garded in amy just sense s contracting {ndobtedness by the corporation, 'T'he revenue hay already been provided and set apart for a specific purpose, 3nd 1n contemplation of Iaw it 18 in the treasury of the corporation. 1t is obvious, there- fore, if the appropriations do not exceed the taxes levied for payment of the same, no additional cor- porate indebicdness is created. Assuming a8 1do that the propoition that a municipal corporation may appropriate Ita revenues in snticipation of their receipt as eflectually as when actually in its treasury may be maintained both on principle ana authority, the questioy occurs, What s the moet feasible mode of anticipating such taxes? and no better plan sugzests itself than by > TEMPORARY LOANS.” It has for its support_considerations. of conven- ience and econowmy. 1tis not practicable to agree with persons in the service of the corporation in the various departments 1o wait for their wages untll the revenucs for the year in which the services were rendered have been collected. 'That might in many instances be beyond the term of their employment. An insuperable ohjection to that mode of defraving all ordinary expentcs for any year out of the revenue of that year is the taxes so levied are mot all collected within the fiscal year in which the services are rendered. No prudent man would nndertake to manage his pri- vate afinirs in that way. Implied in the power to make such **temporary loans ™ in anticipation of taxes levied is the nuthority to pay iuterest on the same a3 an incident to the principal thing done. One is 8s luwtul as the otlier. City of Galena vs. Corwitn, 48 Ill., 423. But the question of most eceming difference i8 whether *‘tempurary loans " aflected with a view to snticipaic the reve- nue of - any fiscal year is coutracting municipal _indebtedness ~ in the sense that 1e: used in the Constitution, 1 am of the opinon fi {s not. Both principai and Interest of guch **temporary loans™ urc payable out of the revenues for the fiscal year for which they were made. It can make no possible difference, in o legal point of view, whether the revenues for any fiscal year are anticipated in this mode to ralse funds for Immediate use with whicn to defrey or- dinary expenses for which uppropriations have been made, or whether i¢ 1s done by contracts with persous in the service of the corporation to wait for {heir wages until the revennes of thai partic lor year as a matter of fact come into fhe Trea: ury.. The former would be u practical and cco- nomical way of anticipating such revenncs, while the latter would involve the necessity of paying in- creased wazes for everything done for the corpora- tion, whicl would be équivalent to & discount of the teual rate of interest for that period, if not greatly in_excess of it. The cases cited supra wustain the view of the law we ha taken. The smme cases wero cited Dby this Court in_ the 3Masor of Springficld ve. Edwards (Jan. 7, 1877), and the rule recognized in them was assented to by the membersof the ncurring in that oplition with twa qualifi- catior 1. The tax appropriated mast at toe time be actually levied: and 2, by the lesal effect of tuc contruct between the corporation and the indiyid- nal, made at the time of the approprintion and is- ening and accepting an order on the Treasury for its payment when collected, must operate to pre- vent any liability on_ the contruct azainst the cor- poration. It was Uhen said that the principle is that there I8 in such cases no debt, because one thiug i3 simply given and accepted in_exchunge for unother. That fs the precise case presented by this record. All ‘‘temporary loans™ for which aporopriations for the payment of interest were made were obtained after April 1, 1875, and, as far as we can kuow, boih principal and in: terest were specifically made_basabic ont of the revenue of that fiscal year. No proof {3 made to the contrars, and o presutnpiions wil be indulged tuey will not be paid in that way. Suficient ap- propristions were made for that distinct purpose, und in_the absence of nroof it must be understood that which the luw requires the municipul ofiicers to do will be done. Whether these are **tempo- rary loans” that were contracted in previons years that constitute municipal indebteaness and there- fore nvalid, because inhibited by the Constitation, i 8 question notbefore us, nor does it in any way affect the present decision, and for that reason I forbear to remark upon it. RAILROAD TRACKS. The point is made that the Revenue act in that provision which requires the State Boards of Equalization to **valuc railroad-tracks” and divide the aggregate between the several connties and_other munjcipalities in _proportion lo the length, situated therein, violates the rale of uniformity, waich the Constitution requires shall be observed, in valuation of property for taxation. The reazon assigned is that 1t deprives counties, and citics of the value of this class of prop- uated within their limits a3 3 basis of tax- As the taxes In this case were levied on the ation. basms indicated, 1t is #aid that all taxes, except State taxes, are alike uncqual and vold, because the law fixes the basis of assessment forbiduen by the - Constitution. The fallacy of this urgu- ment is, that it rejects the definition given by the Lourt 'n Porter ve. K. R. 1. §. and St L. 3t R., 701l 501 of this ciass of prop- erty, that a railroad and its cquipments constitute 3 single entire property. AS was nd in that case, “‘the costof construciion in any particalar town or county affords no criterion of the value of that portion of the road. for cvery intle of the road is Cauully indispensasic to fis_existence as a whole, und contributes broportionately to its principal earnings.” It may be that in centres of traflica Yinited mumber of feetor rods of a raflroad may carn by way of rent from other companies a larze percentage’ of its costs exceoding the proportion earned by the balance of the roud in its ordinary and fegitimate businesa; but It is apprehendedl euch increased earnings are duc to the fact that uch compsnies havo extended lines that bring the products and trade of a wide expanse of _ conntrs over them, &nd butfor euch extended lines, ‘crowding business into great centres, no snch rents could be realized. 1tis in that way every mile_of the road, whether in one county or another, without reference to it actual cost in any locality, whether 1aid with_steel oriron rails, orover laad worth much ur little, wmeasured by 1ts acreage, **contributes proportions ately to ita principal earnings.” What may be the relative value of lands 1n the several counties over swhich the trackis lafd, is not a periinent inquiry in assessing the value of the track us wuch. Itsuse by the raroad company Is exclusive for a einzle | contrived as deflnite parpose, and it i8 wotth no more in one locality T snother for road-bed. Keeping {n view the facta railroad and its equipments must be regarded for most, if not for all, purposes **as & unit, or as constituting & single entire. broperty, ™ the ' mode prescribéd in the statute for assessing it for tasation s one that best observes that rale of uniformity which the Constitation enjolns. The State Railroad Tax Cases; 2 Otto, 575, arosc under the laws of Tlli- nos, 1n which the precise point wus made as in this case, that ** the railroad track, capital stock, and franchise is not assessed In tach county where it lies nccording to its value there, but according 10 an aggregate value of the whole, ‘in which coun- ty, city, or town collects taXes according to the Jength of the track withinits imits, " and ina well- reasoned opinion this provision of onr Revenneact was sustained. ASSESSOR AND TAX COMMISSIONER. ‘Among the appropriations made was one moking provisions for the expeuse of the oflices of Asses- sor and Tux Commissioner within the City of Chi- cago, and objection 18 urged against the tax levied to poy the same, on the ground that there conld be 00 sueh ofiices in thatcity under the General Incor- poration act. 'The city became incorporated under the general law, Apni23, 1875, and on the 3d day of May, 1875, the City Conncil by ordinance de- clared 'sl) municipal ofiicers in ofiice at that date should continue in office and exerciso the eame powers and perform the €ame uties s before, unil their succeasors should be elected and quali- fied, and nuti] otherwize provided for by law or ordinance, 1t woa declared in The People ya. Brown, 84 Tll., 45, the organization of a city under {lie General Incorporation act determines the terms of all officers under ite special charter, ex- copt such as are within the saving cluuss of that act. The saving clause, however, includes no such officers a8 Assessor and Tax Commissioner, But under the general Iaw, the City Conncil hud power I lts discretion, from time to time,” by _ordinance passed by a vots of two-thirds of ail the Afdermen elected, to provide for the clection by the legal voters of tho ¢ity, or the appoiutment by the Mayor, with the spproval of the City Council, of certuin enumerated ofiicers, and **such ofher ofiicers as tmuy by eaid Counctl be decmed necessary or ex- cdient.” Under the comprenensive power con- Forred, no reason is perceived why the Gity Conncil could notin its discretion, subject to constitutional restrictions, create any ofilce it deemed nccessary to the cfficent administration of the City Govorn- ment, sud establish or provide for filling such offices by election orappointinent. That discrazion cxisted, and, in the absence of evidence to tho con- trary, the presumption ought to be indulged, the City Councl had in sowe lawful way exercised the discretionary power with which it is clothed in the creation of such ofiices, or else it would huve been gullty of the extreme folly of muking the approprinuions for paying the exvenses of such ofiices when vone existed. In 1 coilateral pro- ceeding thero is no warrant for declaring incum. bents were not rightfully exercising the functions of uch offices and entitled to recelve the emolu- ‘ments connected therewith. EXPENSES OF VISITORS, A enm, insignificant 1 smount, was aleo ap- ‘propriated to pay expenscs of entertaining official visitors, and the point is preszed on_the attention of the court, but not with much earnestness, that that s an illegal purpose, aud hence the tax lovied to pay the same 18 void. " No warrant is found 1n she Appropriation act for any such appropriations, but the special charter under waich the city was incorporated contained a provision expressly anthorizing expenditures for entertainment of_of- ficial visitors, By a provision in the gencral law, cities adopting it may still exercise &nch powers ns were couferred by the specfal charter by which they lnd previously been incorporated a3 are not inconsistent with the General Incurpora- tion act. _That was so declared inThe People vs. Brown, cited supra. No coufict exists between that provision of the special churtor sathorizing cxpense of entertaining official visitors and the greneral law, and a3 to the propriety of such uppro- Priations, that ia with the Uity Council. "The csse in hand presents some questions abont whica I am NOT ENTIRELY FREE FROM DOUBT, and impresees the mind with the exceeding great difficulty experienced in makiug assesements and collectlag _revenues wherc so many kinds of taxes are involved under a complicated revenne system. In the sume proceeding may be favolved State and county taxes, municipal taxes, opark taxcs, epecial assessments and epecial _ taxea for local improvements, and asgeased by different corporate bodies under differ- ent enabllng acts, That some slight crror may - torvene is 10 be expecied, and 1 am more thun ever impressed with the reasonableness of the rule deolared in Penuington vs. The People, 79 1il., 11, that mere formal objections to municipal ‘and other tases should not be entertalned when the irreguiarities complained of do not atfect unjascly the interests of the citizen. A taxis treated by sriters on political cconomy 23 a *‘just debt™ due from the citizens to the State for protection to Jifo and prop- he is under both moral orty; that and jegal obligations to discharge, and the with- Biolding of whiich is deewed u public wrong. It1s said the oblivation proceeds from the hizhest con- siderations that concern the public_welfare. The captious objector is one who Is unwilliug to pay u due proportion of the expense of government that sccures that protection to_his property, that gives it all the value it has, and without which he Could not emjoy 1t. VWithout such protection it would be 3 prey 10 _every luwless desperado who mighi posscss uuilelent physical power to appro: priate it to his individus) use. Our law is that all needful tax shall be levied by valuation, £o thut cvery person and corporation shali psy u tax iu provortion to the valne of his or its = property, and such taxes shall Y nniform fu respect to the persons and property within the jurisdiction of the body fmposine the same. But exact uniformity, elther in respect to ‘persons or proverty, i8 not attainable. An approx- imation to such result jeall that can be exvected. All property, were it posaible, shiould be made to bear its just’ burden of taxation, but mere irregu- laritles that may lutervene, either in making valu- ations or in levying taxes, will not vitiate tie tax unless it is apparcat such frrezularitics affect sub- stantially the justness of the tax Jevied, or debars th citizen of some important right secured by luw, Ttiva cardinal principle every tax should be so to toke from the people as little possible over what il brings to the treasury of the hody imposing it. 1t onght not to e wasted upon annecessary ofli- cers, nor frittered away by forfeitures 25 suilered {0 the State,—a practice now much resorted to, as it scems to be favored by the existing Revenue law. In thisway a tax 18 sometimes rendercd more burdensome to the people than beneficial w the State, Some system ought to be adopted that wonld induce prompt payment of sll needful taxcs imposed. Suctia result woald lessen, in o great degree, the ageregnte amonnt of taxes re- Quired to be'levied.” Uncertainty 1n_taxation en- courages persons who wonld 4pay no taxes svhat- ever, unless the law seized toeir property and ap- propriated it to that purpose. Deficiencies arising as from non-paymeni must be made up in ~ some way from other taxpoyers, and toelr burdens in this respect are nnjustly Increased. Uniformity in payment of taxes is quite as indispeusable as uniformity in Jevying taxes to effect the purpose of the Cobsti- tution, and cvery person and corporation shall be compelled to pay & tax in proportion to the value of bis or 1ts property. ‘The prescul is o time of nnosual financial embar- rassment, and even a needful tax becomes u bur- den on the owner of property, but there cxists no authority in courts to relax the rulea of law on that account. A precedent sel now in that respect would be productive of evil resuits, when this great depresslon is removed, as it must needs soon e, and would thereafter embarruss the collections of revenne indispensableto the government of o pros- perous people. Greatcaro stould betukentolevy 10 more tax than is needful, and prompt pagment should be enforced. Tiere'are and can be 10 just grounds for compluint that the proverty of con- testants In this case hus been made to bear more than its just burden of taxation, and in my opin- fon the judgment ought 1o be afiirmed as to all the taxes lizated. All the members of the Court concur in this opin- ion except us to what is said as to _the validity of taxes levied by the City of Chicazo to poy intercst on temporury foany, and also s to the toxes levied by lexc city to pay expenses for entertaining ofiicial visitors. CITY OFFICERS. WIAT THET THINK OF IT. As a usual thing, it is not very diflicult to get an expression of opinion from a city official in regard to city affairs. The Supreme Court de- cision in the matter of the revenue warrants, however, had such au effect upon them- as to deprive them of the power of speech. They were get-at-able, but were dumb when ques- tions were asked. The opinion scems to have acted like an electric shock, exciting therh even beyond power of speech. They are extremely anxious, and the question mow uppermost in their thoughts is, * How is the city to be rua this year#? THE MAYOR, “What are your views of the situation?” said a reporter to Mayor Heath. * have no opinion at present. There are s0 many things to think of 1 haven’t had time to form oue.” As soon as I can make up my mind, Iil gladly let you know my conclusions.” “Whai is yroiug to be the effces of the de- cision? " was the question asked _ CORPORATION-COUSSEL 1O : “ Young man,it wouldn’s be politic for me to £ay auything now. *What are you going to do abont it?" “I intend applyine for a rehearing. ! “Do you think you will gec it §" “Ihope s0.” crrr-atronsPr rennL a5 more communicative, “What is your opinion?” aid the reporter. “I canuot sec that, the decision is substantial- 1y different from the opinion of Judze McAllis- ter, and sustained, as 1 understand it in the Springicld case.” It does not declare void the present certifi- cates—those fssued after May, 15767 “No. -They were not before the Court. The drift of the decision is to the effect that taxes may be anticipated and certificates drawn as now against a specific_fund mentioned {n the Aporopriation bill. The Court savs, in the Sprincfleld case, that that does not establish a liabllity of the city, but the city cannot be sued upon the certiicates.” i ** Then it is a debs of honor?"” “ Not that exactly. There is another remed; for the collection of certificaies as edicient and as promyt as sueing and getting judgment.” & What is that?” ““The law proyvides that the officers shall pay out the taxes, when collected, for the purposes for which they were originally appropriated. Wheu the taxes are collected they are in the City Treasury. Their collection has been an- ticipated, and warrants have been drawn against these tax-levies. A comes in with a warrant and says, ‘I want my money; you have collected it. ‘I'ke money he had ndvanced was put into, say the Police Fund, and was used to pay nolice- men. Whoen the fund’s money is collected it belongs to him. There never will be any dispo- sition on. the part of any public officer in Chicago to violate that law which says they must pay out the taxes, when collected, for the purpose for which they were appro- Driated. This will amply protect the holders of certificates. 1f any officer attempted to do otherwise, any person could o before the Grand Jury and have bim indicted for malfeas- ance in oflice and sent to the Penitentiary. And there ie another remedy. A holder of the cer- tifieates could apply to & Court for s mandamus to compel the oflicer 10 pay out the money in the Treasury due on_the warrnnts. If Theld one of the certificates T should feel a great deal safer than if I had a picce of paper onwhich I could sue the city.” = *What will be the effect?? ‘I think it will make capitalists nueasy for a time,—until the full bearing of the matter is understood. Ido mot believe it is going to make it impossible for the city to obtain money as it has been obtaining it for the-last two yecars. I do. mot belicve it is going to block the wheels of the Government. It ap- pears to me that the sccurity is so ample and cfticient that prople who have money to loan yrill tind it out, ana buy the certiflcates as usual. The simple fact that they cannot sue the city on them will not deter them from trasting to the city's honor to pay them. Tley are se- cured the same as United States or State bonds. ‘The honor of the community is pledzed. You cannot coerce the State or the United States.” “You do not think the decision touches the certiticates issued since May, 18761 “Noj;only those issucd prior, which are simply time warrants, promises of the city to pay 50 much money at a fixed time, and not ayable out. of any particular tax-levy, Judge McAllister held that they were fnvalid—that they created no liability against the city.” ‘The next one interviewed was COMPTROLLER FARWELL. “How do you regard the situation? #] have nothiug to say at prescat.” * What will be the eflcet#”” ] couldu’t tell you to-day. I haven’t had time to consider the matter.” “Will you pay the certificates issued since May, 185761 “Of course we will pay them. You cannot gt the people of Chicazo to repudiate even the old certificates.” © Are you going to issue any more?”’ Ve can't issue any more until the appro- riation for 1878 is made?” il you pay thosewhich fall due sfonday?" “Yes,—pay all as they fall due. We bave taken up $33,000 (including interest) this mopth."” i «How are you going to get grease for the wheels?” 1 don’t know; Ican't tell yet.” “«Will you bave to put oun the brakes and stop—shut down?"” “Shut down? That means anarchy and chaos.” “What arc yon going to do?? “J am not CErep:arcul to say.”? “How much will you give for a $2,000 certifi- cate!”? “Tts face, if I had the money. It is worth just a3 much as it was worth yesterday.” “ And how much was that “Dollar for dollar. I bave a conundrum which T would like to propound to the Supreme Court. In 1877 au appropriation of $4,000,000 was mude. Suppose we borrowed within say even 10 per cent of that. We paid the current cxpenses of 1877, for which the taxes were levied, by borrowing from A, B, and C, and gave them certificates, Now, if these certificates are not good, I should 1ike to know what I am goiog to do with the moucy in the Treasury, levied and collected to pay the current expenses of 1877 if I cannot take up the certiticates with it? 1. certainly will not pay it out for anything else, because T don’t want to spend the remainder of my life in the Penitentiary. The money was approbri- ated for o specific purpose, and it cannot be di- verted.” ‘The reporter then ran across ASOTHER CITY OFZICIAL, who consented to talk after, exacting a promise that his name should not be fisea. “ This decision covers about $1438,000 of the taxes of 1875,—items in’ the Appropristion bill for interest on temporary loans. The rest of the levy is sustained. The Court, in holding “that the items for {nterest were illezal - and void, took the ground that temporary loans werc a debt iwithin the meaning of the Constitution, and therefore that the certillcates issued in 1875 were no good. Those certificates were entirely different from the ones which bave been issued lately, being drawn gencrally acajnst the revenues of the city and not payable out of any particular fund. “Che prescnt certificates are drawn in anticipa~ tiou of the taxes of the curreut year, aud are payable out of the particular fund on which they are drawn. Tax-fighters can derive no ad- vantage or benefit from the decisiou as to the Jevies of 1870 or 1877, for the reason that the jtems for temporary loaus are not stated in those appropriations.” It is still a question, not- withstanding the opinion of the majority of the Court, and following strictly the ogic of the Seringficld_case, and without taking into con- sideration the reasoning of Judge Scott, whether or uot the certificates Jately issucd by the city would be sustained by the Supreme Court.” . ; ALD. SEATON. # What do you think of it « It is an outrage.” * Will the city pay?? s Certalnly; every cent. If necessary,we will make a regular :lppmim’;\uon, cut down ex- penses, and have a surplus.” ALD. ROSENBERG. “ What. is your opinion ¢/ «Well, we bave got the money to pay the certificates and will pay them. It cannot be di- verted.”” ALD. PEARSONS. « TWhat are your views of the situation?? 4 It is very interesting indeed.” 3 < \What will the city do ¢ “ e are zoing to do the best we can.” «« Repudiate?” « Not u dollar, sir. Every dollar will be paid. There is an clement in this city which will not permit a certifieate to £0 to protest.’” “What cffect will the decision have?” « It will bring us into a better financial con- dition after a little white than we ever have been, or we would have been without it.” “ You can borrow no more money ?? “ No. We are goine to run the City Govern- ment the next year, but will cut everything down to zgro.” ~ « % Do vod really Enow what you will do?" “ Candidly, no. We bavea't had time to talk the matter over, but you can rest assured that every dollar will be pald.” ALD. COLLERTON. « Unbosom YourselL.” 1 don't thiok the 1876 and 1877 certificates are affeeted.” 4 The eity will pay?” “ Certaiuly.” “ lil’?w ar¢ you going to get through this year ’ “T'be people will see to it that tLe Govern- ment is provided with means, It fs absurd to talk about shuttin down. The people will not stand it. They think too much of Chicago.” Otber Aldermen were also seen, but as they cxpressed the same views as those already given, it is not necessary to repeat them. THE FINANCE COMMITTEE. TALKING IT OVER. The Finance Committee of the Council bad o meluncholy meeting yesterday afternoon. It bad been the intention of the Committee to take up the estimates, beginning with the Board of Public Works, and make sueh reduc- tions as might seem necessary to them. But the decision relative to city certificates came across their path, and was so uncxpected and 50 surprisiug as to prevent their begiumng with their task of revising the cstimates. They sat and talked the matter over, almost in despair; ignorant where to begin to do suthing, or, in- deed, what to do. There was a little talk about cutting down on a small scele, by dispensinz with the Gas Inspector, ‘or the Mayor's Secrctary, or some such minor officers, but it was decided, after 3 waile, that the cutting down must be more radical. It was decided, withont a dissenting voice, that the city certificates must be paid. To their redemption the lonor of the city and of the Aldermen was pledged. Come what might, they must be provided for. - That point set- tied, the question arosc as to how the City Gov- crnment was to be carried on during the pres- cutyear. It was the opinion of the busincas men composing the Committee that no banks would be found willing to lend money upon inserest-bearing certificates after thelf validity had been impuzned. 1t was comsid- crod questionable whether any one would juvest in a security _concerning which these comld be a shadow of doubt. Tos, even though o rehearini were granted and the’ aecision were reversed, Yeb many months Iust elapse before any such conclusion could be reached, and in'the meantinte all would Loid aloo? from city certificates. They all seemed to agree, 100, it was understood that this business of borrowlag wasa bad one and was getting worse from year to year. They did not see Bow the Revenue law could be so changed ns to enable the city to colleet during 1878 the money which Was to pay the expenses of 1878. It was suggested by one of them that the city ought, like a business man, to have 3 copital—a surplus—on_ which it could do business during 1878, or until that time in 1879 when the taxes of the prior vear were collected. 1f it had sach a capital on hand, if it were forehanded, it would not re- quire to £o to the banks or orivate individuals to get money to pay its cxpenses. But then they came back to the problem, TIOW THEY COULD GET THROUGH 1878 without ability to borrow moncy for the pay- ment of police, firemen, school-teachers, or in- torest.on the bonded debt. Some of them thought the best thing to do would be to stop all improvements, to reduce the police force to 300 men, to buy no new engines, to cut down the appropriation for the Board of Public Works from $300,000 to $100,000, to make no street improvements, to do nothing which was not absolutely necesssry during the present year, to make such appropriation for these items it was absolutely necessary, and then to make an appropriation for a_contingent {fund,—perhaps an aporopriation of $2,000,000,— 50 that they might ultimately have a surplus un hand with which to do business for themselves. But even though they cut down_eversthing to the narrowest limit, yet they did noi see how the money which would be required to pay for. the policc and Hremen whom they kept, or for the interest on the bonded debt, could be obtalned, and they had not settled that point wnen they adjourned. The meeting, in fact, was held too soon after the decision was recelved, and before the mem- bers of the Committee had had time todigestit. Attention was also -called to the fact that $800,000 was appropriated last year for sewers. Of that_amount $125,000 has becn expended, leaving $175,000 which ought to be collected during the year, and which will begin coming in very soon. Of course, this money has been ap- propriated for the construction of sewers, and cannot be diverted for any other purpose—that is, it cannot be appropristed for the pay of policemen, or for building en- gine-houses, It was sugmested, however, that that omount could remain unexpended in the Treasury to the credit of the Sewer-Tax Fund, but couid be borrowed by the city for other purposes, just precisely as other funds. such as the Water Fund, have been borrowed from. Such borrowing would be a mere matter of bookkeeping. It would really be a sum of about $175,000 which toe city would bave at its disposal, and which it could use without paying ingerest on it. The Committee was also concerned about the sugeested appropriation of $200,000 for a. City-Hall. he " members will prob- ably decide to leave in the appropriation, because the city Las pledged itself to make ood the amount which it borrowed from the ‘anal - Redemption Fund, but, at the same time, it is not likely that there will be any an- tivipation of it, so that no work will be done on the city’s part of the Court-House this year. It was also believed that a more rigid en- forcement of the license laws would hring into the Treasury a considerable amount of money which now mnever reaches it; and that the re- ceipts from that source would go a good way towards paywg off the most pressing claims upon the Treasury. It was thought that the schools might be run with such economy that the pc!:{ of the teachers could be substantinily provided for by the rents from school lands aud by the amount received from the State. And it was also hoved that something micht be borrowed from the Water Fund, the receipts from water rents coming in in great quantities in May. ‘The Committee will meet again to-morrow. MR. ROBY. 1S OPINION REGARDING THE DECISION. *Well,” said a reporter to Mr. Edward Roby yesterday, **what is your oplnfon of this decis- ion?” “1¢ 45, said Mr. Roby, “that it absolutely Drohibits the city from borrowing mouey in any manner, shape, or form in ¢xgess of the consti- tutional limitatlon, and that it declares illegal the city certificates which have been {ssued.” “The decision relates directly to the city cer- tificates which were issued prior to 1876, and de- clares those fllezal and void. There are out- standing certiflcates of that issue to the amount of about $500,000. There are yet uncollected real-estate back taxes for 1873 and 1874 to about $1,000,000. Now, cannot the Comptroller use those taxes as they come in for the purpose of paying those certilleates?’ % “He capnot without a perversion of the money, and without becoming liable to the sec- tion of the law which Mr. Farwell quoted in his letter of yesterday to Tie TRIBUNE, which says that if hé pays any money out illegally heis subject to a fine of about $10,000.” #Canthe Council make an appropriation for the pavment of those certificates” 4No. The Council has no power to give away city money."" “Suppose it does make an appropriation?” “ There is o oflicer who could pay out under it without being ameuable to that section of the criminal code which I referred to.” “THEN WEAT IS TO BE DONE WITH THIS BACK-TAX MONEY when it does come ini” ¥ Use it for city purposes.” «But it has already been appropristed for certain specific purposesP? “Where an appropriation lapses—for In- stance, if mouey_ should be collected for light- ing the City-Hall, and the - City-Hall should burn” down so you could not light 1t, sud the money should be collected, the city could then appropriate it to other purposes, provided they were corporate purposes of the city, for which the corporation is authorizea tospend money by its charter. Any tax 80 paid, if paid voluntarily, i3 8 gift to the city, just like the illegal taxes of 1872, which were levied without any Tcolor of the au- thority oflaw, and were collected to tne extent J of nearly £5,000,000. That money was a gift to the city, and, like any othor gift the city was au- thorized to receive, it could apply it according to its trust for corporate purposes. It would nave no_power, however, to apply it to other than lesitimate corporate purposcs.’ “ You hold, then, that this will be true of the money cotlected on the 1875 levy for paying these illegal interest appropriations #Yes. That money thus collected, or which bas been contributed by the taxpayers, can be used for any legitimate corporate purpose.” #To use it for paying these outstanding cer- tifieates would be a perversion?” “Doubtless. Paying o debt that did not ex- ist would be a perversion.” “ Cannot the city make these temporary loans if it at the same time makes provision for the payment of them, and for paying the interest on themi” “ As I understand the Constitation, no debt can be-created in excess of the 5 per cent limita- tion, and then it can only be created by an ordi- pance which shall levy the tax for paying the iuterest, and also for discharzing the principal of the debt within twenty years, and if the charter does nmnot vest the power to pass such an ordiuance it is entirely oot of the power of the city to be indebted one dollar, even within the limit of the Conpstitution. On the matter of running in debt, I understand these taxes levied to be debts from the citizens to the city, or county, or State, after the levy, for it hos been so decided in a great many cases thut they are simply debts owed by the eitizen to_the taxing corporation, which be is under obligation to pay at certain times, and which, if he does not ay, may be collected as rents are collected, or asdebts upon promissory motes or obligations are collected. If the creditor wants to spend some money equal to that which is to be col- lectea hereafter, he must borrow money, or give his paper, or other obligation, ~Dpayable when Tihe “debt is _collected. 'Then the creditor runs in debt to that extent, and there is no form of words that can chauge the character of that becoming indebt- od. s Iunderstand, the city cannot become indebted upon the pledge or mortgage of future taxes, or any anticipation of collecting debts due to it, any more than any private_individual could. If it bad the power that old Govern- ments bad to sell itsclaim for the debt, to trapsfer it without recourse, so that the pur- chaser could go and collcet thic tax as his right without recourse fo tlie city. it might raise money upon such debts, but if it has to take any band in the collection and in the paying over of the money, it is bound to collect it” be- fore it can g0 act as to fncur an obligatfon on its own part in any form.” “ Can the city get around the difficulty by passing an ordinance preliminary to an a; propriation ordinauce, setting forth that it f,f necessery for it to borrow 4,000,000, and then procecding to levy & tax for the collection of that amount, and;providing for the fnterest on that loani” XNo; for two reasons. First, the constitu~ tional limit of indebtedness has been reached; second, the Charter does not-invest the Coun- cil with any power to pass snch an ordinance.” GETTING A SURPLUS. “In what way can the city get out of the vicious system into which it has gotten?” . ‘.By baving on band a surplus which will en~ able it to bridge over the chasm—the gup of one year. In 1870, just before the new Coustf~ tution went into effect, the city sold $3,000,000 of bonds. If the money derived from them had been kept in the Treasury, iustead of putting It futo sewers and school-houses, it might have Jetc. been used from year to year for the uxgaae of runoing the city until the taxes welepcnl ected. If, too, after the adoption of the new Constitu- tion, when the Leeislatore met the subsequent winter, the necessary leislation bad been se- cured, there would have been nodifficnlty like the present one. If, in 1671-'2, when the State gave to the city substantiglly §2,500,000, the mouney had been husbanded, and legislation, it any were necessary, had been then obtained, the difficulty would have been bridged over. Or if, in either of these cases, the money that ot into the Treasury unn}:moprlnxed had been used to pay for the time for which the city offi- cers were accustomed to borrow money in antici- pation of revenucsuntil the tax lcvies had begun to come in, and then the bookkeeper— for the Comptrolier is nothing but s bookkeep- er, and has no business to step out of that posi- tion—if be had kept an account of the moneys actually in the Treasury, and only drawn a warrant for payment when there was money there to be paid, affalrs would have been kept wholly out of confusion: and to-day, without additional legislation, if this temporary loan now outstanding is feft to take care of itself, and If moncys to be paid into the City Treasury and uow in are used for the carrent expenses of the city, no debt belng incurred for these current expenses, the ssme end will be accomplished. Of. course, the rcmedy is a severc one, but the persons who loaned had no business to loan the money. The amount used in excess of appropriations each vear since 1870 would considefably exceed $1,000,000, and it has been the willinguess of persous to loan that bas tempted the officers of the city to. get the city into a scrape. There is noth- ing that will now prevent their continuing to = loau, and to add to the confusfon, but_leaving them to their legal rights, and using the reve- nues as the Constitution intended, to vay the current expenses until the time of tne colles- tlon of the taxes.” dt“ g,m the Legislature do anything to help the v ‘It can do nothing that will vitalize that debt, or make it any other thanan embezzle- meant of the city money to pay a dollar pfjit2? ¥ “Well, then "the city must make a beavy ap- ‘propriation to enable it some time orother'to getout of the woods. Is therc asy limitation - on city taxation!” i i The General Revenue law and City Charter, ‘when adopted, cicarly repealed ali limit to city taxation, and it was in the power of the city at any time after July 1, 1572, to levy a gross sum of 310,000,000 for city purposes Uf mecessars, withont regard tothe percentage that that wonld be upon the State assessment. The power to Icvi a gross sum before the assessment was made was cmbaced in Sec. 122 of the Revenue law. This provision, taking the place of the vprovision {n the former charter, that certain per- centages should be levied for particular pur- poses upon an assessment already made, is evidently o complete repeal of the limitation to percentages, for, at the time the levy should be made under Sec. 122, jt would be impossible to ascertain what the percentage would be upon the assessment to be conrpleted after that time, and there was no limit in the Revenue act upon the gross sum which tke city might levy.” i Can the city then make an appropriation for a contingent surplus fund which may be used hereafter to save it from the necessity of borrowing money ! “That will depend to some extent on ths Supreme Court, and probably tkey will sustain its validity.” THE BANKERS. WIAT THEY THINK OF IT. With a view of ascertaining how far the de- cision of the Supreme Courtaffected the holders of the purse-strings, a TRIBUNE reporter yester- day afternoon called oo the Casbier of one of the largest banking institutions in the- city,— one that has for over a year past made a spe- cialty of buying and sclling city obligations. As the reporter entered the counting-room, he saw smultaneously the Cashier and the absence of the legend, “City certificates bought and sold here.” ““What's the mntter,l’,"!aid the scribe; ¢ taken 1 your siga, have you! e, tow many people have been n to-day asking questions.” 4 Well, what do you think of it?” It oaly applies to the certificates fssned un- der the Colvin Administration. We haven’t got any of that kind.” * How many of them are out?"” “ Don't know exactly, but I think not more than $350,000.” “* Who has them?” «J think they are scattered through the panks of New England. One of the last things ! that Colvin and Hares did before they retiredd from office was to 2o Fast and negotiate a larze amount of these certificates.” “How many do you think are outstand- ing & “Over a quarter of a million, I am informed, g&ho\lzh it is stated that the amount is $400,- " « Are any of them here?” 4] think not.”” “What do you think of the certificates jssued since then?” : “] have confidence in them. Some s yere in asking me what I would give, and I sud 1 wonld take all that were offered, provided the sellers would make them equivalent to 10 pe cent—that is, at a sufficient discount to make, {ucluaing the accrued interest, 10 per cent per annum on their face value.” “As some understand ft, the decisfon pro- nounces all certificates vola.” ] don’t think so. The certificates issued since the exit of the Colvin Administration are based on certsin funds. The Council author- ized the issue to the extent of 75 per cent, when passed ucpon by the Mayor, Comptroller, and Finance Committee.”y “Then vou have no fears about them?” «Not_in the least. Chicago will not re pudiate ber indebtedness.” * Looking at the tuture, how will it affect the clty's credit?”? It will undonbtedly cause inconveniencs. It witl postpone the payment of salaries to the teachers and other employes. The foct is that the system is wrong. The city ought always to have a large working balance on hand to meek, any contingency that might arise.” 3 *Then you haye no fears concerning the new certificates?” o “None in the lcast. If yon bave any certifi- cates, figure, them on the ~ basis of 10 per cent and I will take them.” ‘The reporter expressed his recrets that he did not have them, and accordingly took his Iesve. The baukers gencrally declined to say any- thing regarding a decision with which they were unfamiliar, but all agreed that they did not feel inclined to lend any noney on a doubtful ses curity, such as they must for the present con- sider city certificates to be. They did not feel Iike lending money without Interest aud taking thelr chances of getting the principal. OLD AND NEW. DIFFERENT FORMS OF CERTIFICATES. Following is the form of certificate of indebt. edness now jssued: This is to certify that John Doe has advanced to the City of Chicago $1,000 lawful money of the Tnited States to meet that part of the carreat ex- enses of the year 1677 for which un appropriationr as been made for sald year for the General Appro- priatlon Fand, and thal said sum will be oaid. (o Jobn Doe or’order noon the 2lat of July, 1676, withont grace, at the ofiico of the Treasurer of the City of Chicago, with semi-an- nual interést thercon at the rate of 6 por cent per annum {rom date ot of the taxes levied for safd fscal year, said tax-lovy bav ‘been heretofore actaally made, The Treasurer of the city is hereby ordered to make sald psyment 28 aforesaid, and charge to General Appropriation fand. This warrant is lszued for un amount not excecding the appropriation for the above accoun! znd not exceeding the amomnt of mncollecte taxes apoortioned to ita payment, and which will be heid aud applied therewo. "All ‘of _which is ssnctioned by the Mayor’ and Flnace Committee, and duly authorized by law and the ordinances of said clty. In testimony whereof the fayor and Comptroller of the said city hase signea and the Clerk countersigned these presents, and cansed the seal of eaid city ta be hereunto af- fixed, this 21stday of July, 1877, Moxnoe Hearn, Mayor, J. FARWELL, Comptroller. Caspan Butz, City Clerk. Jacos Roszxnera, A. G. Tusoor, M. ScuwsisTuAL, 2. Finance Committee. ‘The following was the 1875 certificate, which was the one passed upon directly by the Su preme Court: 2 ‘This i8 to certify that the City of Chicsgo ac- knowledges to owe to John Doe the sum of $1,000 lawful money of the United States of America, which sum the eald city promises to pay toesld Jobn Doe. or order, — months after date hereof (without %flca) at the oftice of the Treasurer of the ty of Chicago. with intercst thereon at the ruto of — per cent per snnum, from Hay 1, 1675, This loan having been authorized by Sec. 28 of amendments to the City Charter, approved Feb.15, 1885, and by Sec. 7 of act of General Assembly of the State of Iilirois amending the City Charter, I:A roved April 19, 1860, In testimony whereof the ayor and Comptroller of said city bave signed, ** LET THERE BE LIGHT.” To the Editor of The Tribune. Crcago, Feb. 8—On the corners of Stste and Randolph streets it {s o very dangerous crossing, there are o many cars passing along there. Will not the railroad companies in the city have more tamps and larger burners placed there at once? B A A