CITY ENDOWMENT

Evening Post, Volume LXXXVII, Issue 43, 20 February 1914, Page 4

CITY ENDOWMENT

SHOULD IT BE SOLD? BUSINESS PROPOSITIONS Having carefully considered the question of the Mangahao Endowment, the Legislation and Reclaimed Land Leases Committee of the City Council approved of the sale of the freehold, and recommended the City Council last night that the matter be referred to the Finance Committee for the purpose of completing the financial aspects of the question. The recommendation led to considerable debate, in which the issues of the freehold and leasehold and good business were rather involved. Councillor Buddie, chairman of the committee, explained that the matter had been before the council at various times for about three years. The land was situated at Mangahao, near Pahiatua, was valued at about £18,000, and was divided into leases, of which the lessees had the right of renewal, practically in perpetuity, on a basis of 4 per cent, rental on the unimproved value of the 'and. The committee had obtained reports as to whether this land was likely to increase in value, and the reports all showed that this was not likely. [ The committee, therefore, considered that it would be advisable for the council to accede to the petition of the lessees and grant them the freehold. The lessees were not improving the Jand in the way they should. They could not be compelled to, and in order to keep their rents down they were neglecting the land. The council had its capital tied up at the rate of 4 per cent. Possibly it would be urged that the lessees would make something out of the freehold, That might be so, but the point was that the City Council would also improve its position by obtaining the money, which it could then invest in some more profitable wa-y. OPPOSED ON PRINCIPLE. Councillor Hindmarsh opposed the motion on the ground that, without special circumstances, they should not dispose of the freehold of the citizens' property first consulting them. He believed that the land would improve in value. As to the statement that the lessees were not improving the land, he believed, with due respect to Councillor Buddie, that that was all fudge. It was to the interest of tenants to get the best Value from the land, and when they found 'that they could not get the freehold he thought they would start to improve their property. _ They thought at present that; if they did not do anything to the land, they would get the freehold. Councillor Fletcher opposed the dale of the municipal endowment on principle. Councillor Thompson asked how could it be said that the land would not increase in value when the valuation was now stated at £18,400, as against £16, 745 when the question was before the council some seven months ago? Tie opposed the sale. ' QUESTIONS OF VALUE. Councillor Luckie said there was no analogy between the sale of 1.1.p. lands by the Government and the sale .of this property, which could be revalued every tourteen years, and the rental fixed on a 4 per cent, basis. The land was bound to increase in value within the next ten years, as all farm land would. The anxiety displayed by the lessees to secure the freehold was in itself an argument in favour of the council retaining the freehold. He did not think there was anything in the statement that the land was being neglected. Councillor Frost, having visited the lands, was of opinion that neither the council nor the tenants were getting tho most out of the lands under thf» present tenure. The tenants were neglect ing these lands, while tlisy were improving adjacent freehold lands. He would move, however, that the whole matter stand over for consideration at a future meeting, and that information supplied to a previous council some twelve months ago be put in the hands of members of the present council. MERELY AN EXCHANGE. Councillor Barber seconded the amendment. He said that he would oppose the absolute sale of the property, but he understood that this was not an absolute sale, as the money was to be earmarked and invested in another endowment in or near the city. He agreed that the property was being neglected by the tenants. Councillor M'Kenzie : They wouldn't give up their -leasesj though. Councillor Fitzgerald suggested that some older members of the council should make themselves conversant with the question instead of advising young councillors to do so. He knew the property and believed it to b<s a good endowment and a good investment which it would be absolute folly to part with. Within a year or two the land would be worth £15 an acre, as against £11 at present. Was a man holding perpetual rights over the property going to neglect it against his own interests? He would oppose both amendment and motion. Councillor Buddie sairl he would agree to the matter being referred back for further consideration. Councillor Fuller said that it was "just a mere matter of serfdom" for the holder of rural lands on short term leases such as this. The leases should at any rate be extended to 21 years, so that tenants could borrow money on them. Councillor M'Kenzie said Councillor Fuller overlooked the fact that the leases were practically perpetual. Though tenants, said the lands were neglected they would not part with them. Councillor Wrigjht asked if the council had^already disposed of land at Pahiatua. The Mayor replied that there was only a small piece disposed of for drainage works. Councillor Wright raised the question of whether the lessees proposed to pay cash. If they did not, as he was given to understand, the council could not make a reinvestment. Councillor Hislop considered that the effect, of the adoption of the report would only be to obtain a report from the Finance Committee, Some councillors, however, wished the matter to be dealt with before it had been duly considered. The Mayor sai-d the committee was not desirous of parting with this endowment on the issue of freehold or leasehold, but on what would be the best bargain for the city. They were not getting the best out of the endowment at present. He favoured the questions going back for further information. Councillor Luckie asked was it businesslike to sell a property which was increasing in value and ,buy property which was not so increasing ? Councillor Buddie 'said that, on the price they could get for the land, the rent_ they were receiving now and would 'receive for some time was only 3^ per cent. Councillor Thompson said the value had increased. It had not ; the taxation value was the same now as some time ago, but a special valuaticn had been made for the council's special committee, and that was the increase quoted. The amendment was agreed to on the voices, and consideration of tho ques : tion postponed.