THAMES FINANCES.

Auckland Star, Volume LXIII, Issue 93, 20 April 1932, Page 3

THAMES FINANCES.

BONDHOLDERS AND COUNCIL RATEPAYERS ACCEPT AGREEMENT. CONTROL BY COMMISSION. (By Telegraph.—Own CorreKpondent.) THAMES, Friday. The statement that an agreement with tho bondholders committee had been reached concerning- the borough's financial difficulties was made by the Mayor, Mr. S. Elisor, at a largely-attended meeting of ratepayers in St. James' Hall this evening. The Mayor reviewed the position as recently made public. The period, 193132, was commenced on April 1 with, a debit in the district fund account of £9083 10/ ( J. Coupons for interest and sinking fund charges, amounting to £3689 5/, were met on April 1, making the actual debit at the bank to commence the year £12,772 11/9. On May 1 a further sum of £2105 10/, due for interest, sinking fund and instalment on loans, had to bo met. The limit fixed by the bank was £20,000. "Every avenue for effecting economies has been explored by the present council and tho committee at Wellington," said the Mayor, and it appeared that little moro can be done other than to conserve the interests of the ratepayers, at the same time giving the maximum return possible under the circumstances to the bondholders. Private holders were becoming restive and he was anxious to sco some settlement. The decision arrived at by tho council had been unanimous. Terms of Agreement.

The terms of the agreement were presented to the meeting by Mr. J. Snell, of Wellington, chairman of the bondholders' committee. They were as follows:— (1) That a commissioner bo appointed by the bondholders, the commissioner to be given all the powers at present possessed by the council, and such other powers as may be necessary for the proper discharge of his duties; the committee of bondholders to have the power to discharge the commissioner and to appoint another. (2) That an advisory committee of four members be appointed by the Govcrnor-General-in-Council on the nomination of the council, the present Mayor to be the chairman of such advisory committee. (3) That the appointment of the commissioner shall be subject to the consent of the Governor-General-in-Council, and that the name of the proposed commissioner shall bo submitted to the council at least seven days before his appointment. (4) That the advisory committee be at liberty to tender "advice on any matter relating to the management and administration of the borough. (5) That if the commissioner, on any question excepting the fixing, levying and collection of rates, does not accept such advice, reference ehall be made to an independent arbitrator, who shall be a magistrate or some other person mutually agreed upon, whose decision shall bo final. (6) That power bo given to the advisory committee to appoint supplementary committees (e.g., water, electricity, library, works, finance, etc.), to tender advico to and co-operato with the commissioner in the administration of these particular matters. Mayor to Retain Office. (7) That the present Mayor retain his office during the currency of this agreement, but have no powers conflicting with those of the commissioner, the honorarium to be fixed by the commissioner on the recommendation of the advisory committee. In the event of the death or retirement of the Mayor his successor shall be appointed on the same terms by the advisory committee. (8) That this agreement shall continue in force until March 31, 1935.

(9) That the scheme outlined in the schedule for the repayment of sinking funds and capitalisation of outstanding interest be put into operation. (10) That all future rates collected be allocated to the respective accounts, and in the case of partial payment, be apportioned equitably, and that any amounts drawn from the general account for the payment of interest or sinking fund shall bo reimbursed from the next available proceeds from the appropriate special rate. (11) That all rates outstanding as at March 31, 1032, be credited to the council's general account in repayment of advances made to the interest and sinking fund accounts until the full amount of° £10,451) 4/5 so advanced has been repaid. (12) That the pinking fund rates or an equitable proportion in relation to the rates for interest shall continue to be levied throughout the term of this agreement. (13) That the amounts available from the loan interest accounts for any year, and paid by the commissioner, shall be accepted by"the bondholders in full settlement of that year's interest.

(14) That the remuneration and incidental expenses of the commissioner shall bo a first charge on all revenue of the borough, and shall bo borne by the respective accounts in proportion to the amount credited to each.

(15) That all necessary legislation to five effect to this agreement be prepared by the Public Trustee on behalf of the bondholders, and that the incidental cost of the preparation and the passing of the legislation be made a charge on the available moneys in the general account of the borough. Draft Legislation. (16) That the requisite draft legislation be submitted to the council for its comments and any representations it may desire to make. Tlio schedule referred to was as follows: — (a) Accumulated sinking funds to be released by the Public Trustee. (b) Proportionate payments of the sinking funds to be made to all debenture holders in lieu of interest for the current year. (e) Current year's interest to be capitalised by all debenture holders, (d) Balance of each loan plus capitalised interest to be extended for the period originally fixed for the loan. Mr. Snell said that these terms had to be ratified by a majority of the debenture holders. He did not anticipate anv hitch in obtaining the necessary legislation. Mr. C. S. Donovan, president of the Chamber of Commerce, moved that one of the advisory committee be chosen directly from the business people of Pollen' Street, who were paying 4.3 per cent of the rates. This was seconded and supported by prominent business men, and finally carried by an overwhelming majority. The meeting unanimously accepted the agreement. Mr. Snell said he had been quite sure that the ratepayers of Thames meant to honour their obligations.