PATEA COUNTY COUNCIL

Hawera & Normanby Star, Volume LXVIII, Issue LXVIII, 13 October 1914, Page 2

PATEA COUNTY COUNCIL

MONTHLY MEETING

_;The us-;al monthly meeting of the Council was held on Monday. Present: Crs S. Blake (chairman), 'Wm Kennedy, S. Death, K. H. Cave, A. Symes, 11. Greager, and H. Dickie.

HURSTHOUSE ItOAD

Mr Mitchell interviewed the Council . and reminded them cf the resolution passed some three or four meetings ago ordering the removal-of fences-and obstructions from the Hursthouse road. Most of the fences had been removed excepting a few chains at each' end, which the owners appeared disinclined to displace. These obstructions still compelled anyone- desirous of using the road to trespass on private property. It was resolved, on tha motion of Cr Dickie, seconded by Cr Byrnes; to give notice to the owners in question to" remove the v fences complained of within fourteen days, otherwise the Council will do the work at the owners' expense. • A LEGAL QUESTION. At the last meeting of the Council the financial position disclosed the fact that the bank limit, by -way of overdraft, had been reached, 'and that there were commitments* amounting to, approximately, £4000, to be met before the end of the year. The Council, to provide temporary "relief, .decided to get the necessary extra ad--va'nce from the bank on a "joint of several." Councillors then .signed' a joint and several at the" bank for advances up to £4000; the account was opened in the names of Messrs. Pearce, Blake, Death and Dickie, and from this account advances were made to the Council. j Cr Cave, upon considering the matter later, put the following questions to the clerk: : _ (1) How can it be legal for councillors to lend money on interest to their own Council? •-"' .! (2) How can a local body borrow money legally when it has reached its maximum?. . In reply, Mr Homer. wrote, inter alia, as follows: , ■ ~ i Reading the Act and Mr Martin's opinion, it appeared that the Council can only borrow from the bank by way of overdraft to the extent of the ordinary receipts during the previous financial year. This limit, according to the bank's reading, is now reached, and consequently they refused .to ad- - vance any more by way of overdraft, but I think the bank is in error in, respect cf the receipts as they only take rates and rants, but decline .to admit the Government subsidy. The latter, to my mind, is an ordinary receipt, and is payable on legitimate-in-come from time to time. It certainly is not fixed, as the Government could stop it any year or reduce it, but. to my mind it is a legitimate receipt for past term. The above is, however, beside the question you ask as to the power, of councillors to lend money to their own council. In the first place, although the councillors' names are on the guarantee, they are not re-cited on the deed as councillors, but only as Pearce, Blake, Cave, etc. On reading sub-seption 3 of section 125, Counties Act,-and also Mr Martin's opinion, it appears to me that the Council has power to borrow money (I presume in any way best suited) as many local bodies accept deposits at. interest, no doubt to save interest to • the bank, and' by way of getting the money cheap. The limit, however, of subsection 3 of .section 125 seems to me to aliow moneys to be borrowed "up to the ordinary income, of the body for that.year," "that year" meaning the ■present year (and not-the "past" year as per the matter of overdraft), so i-iat if it is legal to borrow (presumably, any. way ■it thinks best) the Council- can do so up to the extent of its present year's ordinary income. I :may be wrong, as the Act'is rather obscure as to its intention, and I give my opinion with all diffidence. You will note that I think the maximum is not reached until the ordinary income for "this" year (ending next March) is reached. This income, to my mind, consists of general and separate rates, Government sxibsidy, rents, and r.il receipts that can be used ior ou'.nary county purposes. Cr Cave, in speaking on the matter, said that he agreed to the "joint and several" without giving the mat- ' ter. much consideration, relying on the'business knowledge of his fellow' councillors. On more mature consider- i ation the position appeared to him to : be illegal and serious, and he moved-' that it be referred to Mr Martin for ' an- opinion. It was all very well for i them to "think" they were acting1 legally, but supposing the Auditor, General thought otherwise. He desired • to know whether they, were on sound i legal ground in this procedure- Ho ! did not feel called upon to accept aj liability of £500 for the ■ benefit ■of the' rest of the ratepayers, and if ihey were j going, individually, to be responsible for this money they might just as well J cut it short at once. To him the whole procedure now looked illegal, irregular, I and improper, notwithstanding that councillors were, getting no possible advantage out of it.—Cr Dickie agreed with Cr Cave that it might be as well j if a legal - opinion were obtained, ai- I thought he was not faeling uncomfort- ! able' about it. He reminded ccv.~>Mi- i lors that their present financial posi- i tion was brought about by their having put up about a thmousand pounds worth of buildings , (the engineer's house and two Workmen's cottages) 1 the general all-round increase in! wages, and the extra metal purchased. I ihis was all done out of ordinary rev- ! enue, whereas the . buildings (which ! were a permanent asset earning 71. per cent, 'interest) should really have "been ' built out of a special loan.—Cr Death jridiculed the apprehension expressed by Cr'Cave. They had purchased practically two years' mfetal in the one yi»ar and, in. special circumstances, n-any other county councils had had to do the same as the Patea Council had done —Lr Greager agreed with Cr Cave lneir 'joint and several" in any case was only a temporary expedient and made no provision for paying c,f t'leir back liabilities. It seemed tv him that the .Council.would have to f-rect some great economies in the future—The chairman pointed out that the Council had to find the money, and' en en if i the_ solicitor, advised them that their I position was illegal they were no' better otr. He thought it a mistake to have stirred the matter up.—Finally xT,?O^ 11"1 decided to refer the points to Mr Martin for a decision ' '

FINANCIAL

The Clerk briefly reported on the Council's financial position as at Octber Ist. Their liabilities were: Bank overdraft, £5044; joint and several account, 5 Wait otara-Moumohaki Road District account, £461'; Kapara aooount, £440; interest on loan £276: grants, to Road Boards, £2000- accounts for payment (October 12th), *£SK" n Thelr ,assets wei-e: Rates, jxmFT' overnment grants accruing, £290; outlying districts, £387; probable licenses and rents, £350; Govern-

rnent subsidy (approximate), '£I€o@.— JJ Cr. Dickie said the position,:, in a'nutshell, was that they had only their bank overdraft limit to work on for the ! ensuing year.—The Chairman, con-i s:dered that the next Council should appoint a Finance Committee. That Committee cou® then watch the expenditure closely in regard to the contracts that were let. That was where the Council was misled. GENERAL.

! Tne ■" native rate trouble again cropped tip. The Clerk remarked that the Council had £300 outstanding, and ne had not collected enough to pay for ; postage stamps. One native already ! owed £120. The Act was ambiguous, I and it was. a question whether until judgment had been obtained, a. lien could be registered against the ' property .—lt was resolved that the Clerk irame questions bearing on the am- ; pisjuities, to be submitted to Mr. Mar- ; tif, counties' solicitor. . j Mr. W. J. Arundell notified the | Council that a spark from the county ! roller had caused a five, which resulted in the destruction of his fence, and had swept the hillside, destroying native bush. He asked the Council to repair tile damage as" far as possible —The engineer thought that" very little damage had been done, and practically it was only br?ck<m that was burntIt was resolved that Cr. Death and ths engineer meet and confer with .my AruncMl on the spot. j Messrs Hatrick and Co. wrote eni closiiip; cheoue for £1 for rates due' in j regard to Profit's property at Alton ! and not:fym<r that the property had i^p*, «, n l d t0 Mr. John Ridge' of Hur- , leyville, j-' ;[he Chairsfm reported that the com- ! raittpe appointed for the purpose had ed'J Wso for the Council for t-*i 10s._ Authority was given to buy | «n° reqmsit© harness. J The Council decided to fix the subwlv tor the outlying Eoad Boards' dis19 l"i - 6 SA™ e as last year> namely, 12s 6d m the £ where no rate was .struck, and .7s 6d in the £ where a rate was levied. \ ENGINEER'S REPORT. -'The engineer reported -as follows:— Metal —A total of about 1500 cubic ; yards of metal has been delivered during the month, nearly all of which has been carted out and laid. As instructed at your last meeting, I arranged with contractor supplying the metal, and had tne original order reduced by between 400 and 500 cubic yards I Mam South Road.—A total distance or 55 chains has been remetalled on ; vlus road on a portion of which, however, only a very thin layer of new metal was laid. Maintenance for the month has consisted for the most part •in raking up loose stones, claying, and backing up metal. The junction of this road with Whenuakura Station road has been improved, the Whenuakura- , Waitotara Road Board paying half the cost of the work. -Patea Bridge.—The work of rej decking this bridge has been proceedad j with, though very,little more can be I done \\ntil a further supply of timber j arrives, from Australia. ' l _ Patea East.—The metalling authorised :r. this portion of the county is now practically completed, the lengths laid during the month, being Little laranaki road (28 chains), and Freezing Works road (3 chains), the latter ; work being subsidised by the Freezing Company £ for £. Several new cement pipe culverts have been put in and general repairs carried out ■j Patea West.—A total length of 15 chains has been metalled on Lower , Ball road, and a start made with the i metalling authorised on Taumaha (Hamilton's) road. The. work of re- : ducing the cutting at the top end of i Ball road : in order to ease the grade, has now been completed, and after , the new formation has consolidated the I .metal will be laid. The new .concrete j water troughs at Alton Gorge are now : in position, and 100 feet of piping put .i in to connect with spring. A lot of ; general repair work has also been car- ; ried- out on different by-roads in the I district, which are now for the most part in very fair order. Ball Road. —As-instructed I have laid off some work on this road, but before ■ proceeding further with the work I , thought it advisable to consult your Council, as the grades certainly' will not run out as stated by the P.W.D. Manutahi Beach Metal.—l would sup-o;est that your.Council permit me to : call for tenders "for about 750- cubic ; yards of boulders from Manutahi beach, for use on main road between Manaj wapou and 6-mile peg. My reason for ; suggesting this is that the metal we : are obtaining this year costs the Coun- , cil about 11s 6d delivered at the Manu- ' tahi township, whereas the beach. . boulders, even if hand-napped, would : not cost more than about 10s 6d per cubic yard, and if crushed probably not • more than 6s per cubic yard. This in ; the latter case would effect a, saving jof over £137 in the 750 cubic yards. j This stone can, of course, only be I carted during the summer, and the i contract would require to be let very I soon to be sure of obtaining the rej quired quantity. j [The remainder, of the report re- ! ferred to the Waitotara end of .the county.] • The engineer was authorised to call tenders for 750 yards of Manutahi beach metal, to be delivered at Manutahi. Tenders to be in by nest Council meeting.