The news and herald. (Winnsboro, S.C.) 1901-1982, July 18, 1906, Image 1
N;
PUBLISHED WEEKLY WINNSBORO, S. C. WEDNESDAY, JULY 18, 1906. ESTABLISHED 1844
On the Financial Affairs of Fairfield
County.
LEGAL INDEBTEDNESS $24,000; OTHER INDEBT
EDNESS $4,000.
Irregular Practises Condemned--No Dishonesty on
Part of Officials--Important Legislation
Suggested.
To His Excellency, D. C. Heyward, Governor:
Pursuant to the Joint Resolution of the General Assembly, entitled
"A Joint Resolution to authorize the Governor to appoint a Commis
sion to examine into and report the financial affairs of Fairfield County,"
approved the 17th day of February, 1906, we respectfully -submit our
report:
Under the provisions of the Resolution creating this commission, it
was required, "to ascertain what the legal indebtedness of said county
is and how it has been created, for what purposes, what rate of interest
has been or-is being paid, and if any of said indebtedness has been in
curred contrary to the provisions of the statute law," with'power to
extend the examination to the past operations of this county as far as
may be deemed necessary.
Most of our time was devoted to the office of the County Supervisor,
and necessarily so, as it is in that office, claims are audited and allowed.
An expert accountant was employed, and, with his assistance, a tho
rough examination was made for the fiscal years 1899, 1900,4901, 1902,
1903, 1904 and 1905, and claims approved for the present year up to the
time of our investigation were also examined. Our examination, there
fore, covered two years of the administration of B. G. Tennant, the four
years of Supervisor A. D. Hood (Dec. 21, 1900, to Dec. 22, 1904), and
the administration of J. B. Burley, the present incumbent.
We are glad to report that we find no evidence of dishonesty, such as
has been reported in some counties, but we find many irregularities, to
which attention will hereinafter be directed.
A fire occurred in the Supervisor's office in August, 1905. Many of
the original claims were badly charred, and some entirely destroyed.
Some time after the fire, the claims were placed in boxes, but in great
confusion. We began first to arrange and systematize these papers, and
check them off with the "File Books," containing all claims audited and.
allowed, thus ascertaining how many had been entirely destroyed and
their amounts. Comparatively few were entirely missing, and our work
has, therefore, been more satisfactory than we had anticipated.
Our next step was to check off all claims in the Supervisor's office by
the warrants issued in payment thereof and with the Treasurer's book,
with the view of ascertaining the outstanding unpaid claims, and at the
~isaetime ascertaining that the Treasurer had vouchers for his disburse
ments. We had no difficulty in identifying each claim for the years
1899 and 1900, and up to the middle of 1901, with the particular'warrant
drawn in its payment, but in July, 1901, the practice was adopted of
issuing one warrant for the aggregate of several claims, without spt4ify
ing on the warrant the particular claim, or designating in any definite
way, on the face of the warrant or otherwise, the claim such warrant
was in payment. Great confusion, in consequence, resulted in endeav
oring to check the Supervisor's office with that of the Treasurer. Prior
to July, 1901, each warrant bore the same number as the claim it paid,
and, besides, it specified the number of the claim for which it was issued.
Every claim for the year 1899, except the balance due on a note held by
the 5Winnsboro Bank, to which reference wvill be made hereafter, was
checked off as paid by warrants, as wvell as all claims for the fiscal years
1900. In the other years which our investigation covered this method~
of examination was impossible, on account of the system in issuing war-i
rants as indicated above. Where a person held only one claim, his
warrant specified his particular claim, gad4 warrants of this class could
be identified. Generally, in such cases, the nwmber of the warrant and
the claim corresponded; hence we eliminated all of these by checking
with the warrant; but where a person had bought, say tweity claims,
often his warrant was issued in his favor in payment of "twenty etsims/7
without specifying each of the claims. W~e, therefore, eliminated all
claims that .could be identified by the warrants issued in payment of
claims for the fiscal years since the adoption of the irregular practice,.
and then took the aggregate of die claims for these fiscal years that
could rmt be identified with the warratt drawn on account of claims for
these years. and s4btracted t-he total of such unklgntified warrants fromI
the total of the unidentified claims, and the result was $46.55 in excess
of what purports to be tde fatal outstanding claims against the~ ggQnty,
a very slight discrepancy considering the long period covered.
It may be mentioned in this conisection that the present Supervisor,
Mr. J. B. Burley, haying seen a practica'l demonstration of the confusion
caused by the irregularity ua me system of draswing wvarrants, has, very
properly, corrected it,. so that -warranuk now drawi .may ibe positively
identified with tbe clais.
Thue practice of atkowing so-calied discount gad apeyjp claims,
with the interest or discount added by the Supervisor to the face ofti
claim; presented for approval, has 'ontributed 'largeiy 4 hbe indei~d
ness of the county. The sebiedules annxexed .to this report will illustrate,
how this illegal system has deyeloped. We -took ech ~claim for each
firca year, anid ascertajaed the &otai added to claims by 'te Supervisor
in the way of dilscowat. lIn J899, in which year less than one hundred
dollars worth of cams are mssing, this discount amounted to only
$222.38. It was added in that year to s srertain class of claims, princi
paly for extra work on the roads. While Mr. Tataggtn the then Super
visor, testifies that he thought this had been don~e for several.yggrg prior
to 1899, we found, upon an inspection of the claims themselves, that a
far back as 1890, 1891 and 1892, they do not show it, and in the inter
rening years (1892-1899), of Mr. Tennant's own administration, it is
exceedingly rare to find a claim in which this was done. Mr. Tennant
testified from his impressions, and not from an inspection of the record.
In 1900, this- discount increased to $401.91, with less than one hundred
dollars worth of claims missing for that year other than "State Case"
claims, and in the latter class of claims the discount was seldom added.
In 1901. it was $645.30,' with about three hundred dollars worth of
claims missing other than State Case claims, and in 1902, $678.46, with
about two thousand dollars worth o( claims missing other than State
Cases. In 1903, with about two thousand doiitars worth of claims miss
ing, this discount was $802.29, and in 1904. by wvhich tima such discount
was confined to no particular class of claims, but is not included in offi
about two thousand dollars worth of clainas mssing. In 1905 this dis
count had increased to $1,143.10.
By this system, the county has been paying in some instances as- high
as 42 per cent. per annum; in other instances 28 per cent., 14 per cent.,
21 per cent. and so on; in fact, prior to 1905, 8 per cent. was added to
the face of the claim, so that the rate per annum would be even higher.
This discount is included in the amount for which the claim is approved,
and that, too, without regard as to the time of payment. As an illus
tration, some are paid within three or four months after the claim is
made, so that the rate per annum, in such instances, would be 28 per
cent. and 21 per cent.; or 32 per cent. and 24 per cent., when 8 per cent.
was added.
Our own Supreme Court has decided that an approved claim does not
draw interest (Holmes & Calder vs. Charleston County, 14 S. C., 146).
How much less reason and authority for adding discount to claims and
approving them with it included? The Courts of other jurisdictions
have been particularly severe in their animadversions upon these dis
count transactions, and condemned them as essentially illegal and as
being inherently and highly dangerous, and likely to lead to most disas
trous results, and warrants issued on account of claims including it, by
which it is sought to maintain the market value of county paper at par,
are void to the extent of the discount included. It is unfortunate that
county paper is not at par, but the Legislature has not seen proper to
delegate power to County Board of Commissioners to maintain its sell
ing price at face value, by this method.
Fairfield County has been borrowing from the Sinking Fund Com
mission, for several years, varying from $7,200 to $7,400, and for its
payment the taxes levied for the particular year in which the money is
borrowed are pledged. We find that since 1900 this money has been
used, almost immediately upon its receipt, for the payngient of claims for
the preceding fiscal year. This money is borrowed, under authority
contained in the several Supply Acts for the years covering this exami
nation, and is borrowed "for court expenses, jail fees and other defi
ciencies." By using this borrowed money to pay claims of the preced
ing year, and that, too, for claims on which a full year's interest has
already been allowed, under this discount system, not only is the already
high rate of interest increased, but the treasury is thereby depleted of
funds to meet current expenses. The unwisdom of such financial policy,
even if it was legal, is obvious. Nearly all of the money borrowed for
the present year from the Sinking Fund Commission was wholly used in
payment of claims for the fiscal year 1905, held by the Young Men's
Saving and Loan Association, a corporation of this State. We merely
mention this as an illustration, for the practice seems to have obtained in
other years. The Supply Act of 1906 (Acts, 1906, p. 190), authorized
this loan for "Court expenses, jail fees and other deficiencies," and ap
propriates $1,800 for past indebtedness, so that it would seem that not
exceeding the amount appropriated could be so used for past indebted
ness. and the same application of,all in excess of the appropriation is
without statutory authority. Similar provisions are contained in the
Supply Acts of other years, except for the year 1904 no specific amount
is appropriated for past indebtedness.
It will appear by this report that all of the indebtedness of the county
except the Sinking Fund loan ($7,400) and the note held by the Winns
boro Bank ($1,160.48), arose on account of claims for the fiscal years
1903, 1904 and 1905, and especially 1904. In this connection attention
should be called to another irregular practice of the last three or four
years. Occasionally where a person or corporation had bought a large
number of claims for a given fiscal year, and the funds were insufficient
to pay the debts of that year, a new claim was made in favor of such
person or corporation, for the deficiency with interest added, in addition
to the discount already allowed in the separate claims, and the new claim
repysenting the aggregate deficiency, was carried as a claim for the
current yer gcd paid out of the taxes for that year. For instance, a
claim (No. 367) wa.s migdp in favor of the Merchants' Building and
Loan A4ssociation1, dated May 1?th, 1.90w, ftg pqying shgrtage on last
year's indebtedness, $I,000., diseaunt $86,95," making $1,086,95, and,
though a debt, in fact, represented by the unpaid balances on nlumerous1.
separa:e claims for the fiscal year 1901, it was carried as one single
claim for 19D2, and was paid out of the taxes of 1902, on 18th March,
1903. Of course, this course of proceeding was without authority of
law, to say nothing of the discount added. Similar instances might be
given for the years 1902 and 1903, which amount, in effect, to applying
the taxes of those years to the debts of the preceding year.
In some instances, claims are not entered on the file book, subsequent
to 1900, for the correct fiscal year, but we have taken the claims them
selves and made up the schedule annexed for the proper fiscal year.
In the fall of 1902, A. D. Hood, as County Supervisor, through W. A.
Neil. as agent for the Good Rdads Machine Co., of Erie, Pa., bought
certaij n masinery, and gave his note as County Supervisor for $1,769,
dated sometime during taig gjrs part of the year 1903, payable Deccm
ber 31st, 1903, with interest at six pev cent. An agreement is in the
County Supervisor's officc, signed by W. A. Neal as agent, agreeing to
renew this note from time to time for five years. It has been renewved
from year to year, the last renewal being for $1,759.00, dated January
16th, 1905, payable 31st December, 1905, with interest from date at six
per cent. per annum. Some conflict appears in the testimony as to
whether there was a formal meeting of the Board of County Commis
sioners authrn~zing this purchase, but since the County Supervisor has
no authpority to borrow mgnppy, #1 fue ahsenpe of 4 statute expressly
aithorizing it, and is expressly prohibited by Section 609, Code o'f
Laws, 1902, from issuing any certificate of indebtedness, this note is null
and void and all payments made on it, or interest paid thereon, are with
out authority of law.
The county now has only the plough of this road mechinery. The
tractig ggjje wvas sold to a Mr. R. V. Vaughn, of Jennings, S. C., in
Janpary or FebrpaarydI9h0 fe $%Q, flit ?upervisor taking his note; laut
nothing was paid except $10; and the succeeding Superviser took it back
and sold it for $200 cash, paying the-money over to the Treasurer.
As the note is null and void we cannot report this, under the present
icrcumstances, as a legal debt against the county. While the county
may be liable not upon the note, but upon the original contract of pur
chase. for whatever benefit received, subjct to credit for all amounts
paid, whether as principal .or -interest, that question, however, must be
agitid by the proper tribunal. It is certainly not now an approved
claim again4- t1g ggpnty, and your Commissioners are not vested with,
power to audit and allow glaim~s.
The~ Winn~sboro Bank, of WInnsboro, s. e., holds a note for S1.160.46,I
upon which the interest has been paid to December 1st, 1906. This
note represents balance on original note for $2,548.77 for money bor
rowed pursuant to a resolution of the Board of County Commissioners
on 23d March, 1897, by virtue of authority contained in the Supply Act
for 1897 (22 Stat., 553). This is the only outstanding debt prior to
1903.
IDuring the year 1903, Mrs. J. A. Williford, of Winnsboro, through
her agent. L. E. Owens, bought some county claims amounting to
$897.80. Many of these claims, Mr. Owens testifies, had the discount
added, and had bez purchased at different times during the year 1903.
a certificate (No. 669) for an approved claim of $960.65, which repre
sented the aggregate of the claims, with a year's interest. The making
out and approvii a new claim, in substitution for the original claims,
was unauthorized. It should be stated this new claim is not entered on
the file book among the audited and approved claims. The legal debt
is $8D7.80 without ir.terest. In 1904. "Mrs. I. A. Williford, through the
same agent. purchased claims aggregating S510.81. all of which were
approved, and a cerificate for each separate claim was issued to her
certifying the number of the clzim, the amount, etc.. and these certifi
cates were prcduced. These original claims show on their face, except
those for Magistrates' and Constables' salaries, 7 per cent. discount in
cluded in the amounts for which they are approved, the total discount so!
allowed being $21.15. To the extent of this discount they are illegal.
The legal debt is $48!).66.
For several years previous to and including 1904. the Merchants'
Building and Loan Association, of Winnsboro. a corporation of this
State, and now liquidated, had been buying claims against the county.
This corporation was the owner of claims, at the close of'the year 1904,
amounting to S17.538.37. One of which claims for S2,203.40,. which,
as a matter of fact, represented claims bought for the fiscal year 1903,
but a new claim substituted, as in other instances already mentioned;
$203.40 thereof being the discotrnt added. Nothing appears on the
Supervisor's bo ks to indicate what particular claims this corporation
bought, or owned, but its books were produced and its secretary and
treasurer examined, and under the system adopted by the association,
by which its paper was numbered, we had no difficulty in tracing and
finding a large part of the original claims, and they were identified by
this officer as well as by the Supervisor. Some are informally approved.,
but they are entered on the file book as audited and allowed claims,,and
we have so treated them. The present Supervisor issued two checks or
warrants on the Treasurer,.one for $7,400, the other for $138.37. which
were in par+ payment of these claims. leaving a balance of S10,000. He
borrowed from Mrs. MY. R. McMaster. as executrix of J. F. McMaster,
deceased, $10,000, giving his note, dated March 2, 1905, for $10,700,
payable 2d March, 1906, signing it as County Supervisor. He was paid
the $10,000, and the same was paid over by him to the Merchants' Build
ing and Loan. Association. The original claims'have never been re
ceipted or marked paid. The County Supervisor had no power, in the
absence of statutory authority, to borrow this money, and the note is
null and void. A very small part of the original claims are missing, but
it appears from those that were found, that discount was included in
them to the extent of $948.73, and as to this portion they are illegal.
The balance legally due on their account is $9,051.27. While Mrs.
McMaster's note is void, as against the county. she is entitled to the
legal amount due on these claims through subrogation to the rights of
the Merchants' Building and Loan Association.
Besides the note hereinbefore mentioned, the Winnsboro Bank, of
Winnsboro, holds jury, witness, and constable tickets, representing the
Court expenses for 1904, amounting to $1,834.72, and there is legally
due this amount without interest. It has been the practice for.several
years, to allow banks purchasing these jury and witness pay certificates t
interest on them for the time they remain unpaid, but there is no statu- t
tory or other legal authority for it.
D. V. Walker, of Winnsboro, bought from the original owners, claims
for the fiscal year 1904, which aggregated $842.37, and they included
$30.37 bf illegal discount in the amounts for which they are approved.
A. note was given by the present Supervisor for these claims adding one t
yeai's interest to the $842.37. This note is null and void for v:ant of
authority. The legal debt is $812.37. f
Mr. J. B. Burley, "County Supervisor," made his promissory note to I
Mrs. F. M. Habenicht, for $1,070, dated August 5th, 1905, payable on
March 1st, 1906, with interest after piaturity.at eight per cent. per an
num. Mrs. Habenicht bought, during the year 1905, claims for that
fiscal year which were approved 'for $1,032.89. This note represented. t
$1,000 gf these glaims and $70 as interest to accrue from the date of the
note: to its maturity, i mnonths anad 26 days. By examining the original
claims, it appears that $67.69 in the way of discount had been included
in them. By warrant or check, of the County Supervisor, No. 149,
dated 26th March, 1906, on the County Treasurer, seventy dollars were
paid as interest on this note, and a renewal note made, payable 16th
January, 1907. For reasons already stated these notes are void, and the
true evidence of the debt is represented by the ori'ginal claims. The
legal amount due is $1,032.89, less $70.00, part payment, and less $67.69. -
the amount of illegal discount included in the claims, leaving a balancej
of $895.20.
T. WV. Taylor is the owner of claims bought by him from th.e. original
owners, for the fiscal year* 1905,.aggregating $2.108.29, but which are
illegal to the extent of $137.63, discount inl~ded, The legal debt is
$1,970.66.
We find and report that the legal p~ast indebtedness of Fairfield]
Counmty is as follows:
Fiscal year 1902...............................$ 2 00 .'
Fiscal year 1903................................... 3,665 65
Fiscal year 1904................................... 9,418 1,7
It
Fiscal year 1905.................................. ;86 86 r
WVinnsboro Bank above...............,... 1,16 048 t
I
The Singing Pimnd loan for the fiscal year 190G3 is $7.400, at the rat'
of 5 per: cent. per annum, for the payment of which this year's taxe s are!
pledgedl.
The schedules marked A. B. C. D. E, F and G. show the antount of
approved claims for each fiscal year. for wvhat purposes, and the amount
of discount includled, and they also indlicate amount of claims missing
or destroyed by the fire. All nioted as missing are on the books. On
the Books of the Supervisor. under the Road and Bridge Account, is
included the expenses of the chain gang as well as all dlisbursemnents on
account of the public roads,.12l under "The Poor IHouse Accounit" are
included the disbursements on account of the poor house and aid ex
tendled paupers outside of it. WVe have separated the claims to show
how much has been expended for each, but where the original claims are
missing they, of course. could not be so classified. In justice to the
present Supervisor, it should be stated1 that while the expenditure on
account of public buildings for 1905. as shown by schedule G. is in
excess of other years, this is due largely to' repairing the Court House.
and the money collected from the insurance policy was used' for' this
putrpose. it should also be noted that in 190-i muies were bought for
about S920 with the discount included, and this amotunt is included in
the expenses of the chain gang for 1904. These schedules show a
steady increase, within the last seven years, in expenditures. more espe
cially in aid extended paupers. the latter amounting to S1.93:3.94 in
190.5, and in maintenance of the chain gang. which, from the best infor
mnation we could obtain, averages from 12 to 15 convicts. .
While it is generally asserted that a very large proportion of those
liable for road duty pay the commutation road tax, yet the tax averages
only between $600 to S700 pe annum. W\e must conclude that a great
many are escaping the tax and avoiding the road duty.
East Blackstock Notes.
This section is favored with
very good crops, especially corn.
The cotton is somewhat spotted.
The grass is nearly all cleaned
out. Messrs Lathan, McDonald
and Morrison have some very
fine corn and sorghum. My
friend, Sam Mc Donald, still has
some fine hogs.
Miss Bettie McCarley, from the
Columbia College for Women,
spent several days with hei sister,
Mrs. Sam McDonald, and friends
here last week before leaving for
her home at Boardman, Fla.
- Mrs. C. A. Lucas and daughter,
Mrs. Bradford, of Dupont, Ga.,
are visiting her father and other
relatives here. Their many friends
are happy to see then.
Mr. Turner McCarley of Board
man, Fla., spent -last week here
with his daughter, Mrs Sam Mc
Donald, and brother, Mr. William
McCarley.
Miss Lillie DuPee of Tampa,
Fla., was the guest this week of
the Misses McDonald.
Mr. R. S. Lathan returned last
Saturday to Savannah, Ga., after
spending some weeks with his
parents, Mr. and Mrs. W. J.
Lathan.
Miss Sara Lathan left Tuesday
or her school at Sharon, S. C.
Mr. Jno. H. Neil of White -
Jak spent a few days here with
*riends and old comrades this
eek.
Mr. E. E. Lathan and family
risited their uncle, Mr. W. J.
Lathan, this week.
July 14, 1906. Uno.
Only 82 Years Old.
"I am only 82 years old and
on't expect even when I get to
>e real old to feel that way as
6ng as I can get Electric Bitters,"
ays Mrs. E. H. Brunson, of Dub
in, Ga. Surely there's nothing
se keeps the old as young Ana
akes the weak as strong as this
rand tonic medicine. Dyspep
ia, torpid liver, inflamed kidneys
)r chronic constipation are un
,nown after taking Electric -Bit
ers a reasonable time. Guaran
eed by Jno. H. McMaster & Co.,
iruggists. Price 50c.
Not That Kind.
There had been a quarrel be
ween the two families.
The woman of the third-floor
[at had emptied a quantity of
itchen slops on the second-dloor
[at, and the subsequent proceed
2gs were in process of investi
,ation in in the police court. -
"I will ask you, madam," said
e justice, 'to name the princi
~as of this affair.'
"There wasn't any, your honor,"
napped the complaining witness.
It was the most unprnciple
ing I ever saw in my life!"
hicago Tribune.
Does evil still, your whole life fill?
Does who betide?
Your thoughts abide on suicide?
You need alpill!
~ow for prose -and facts-DeWitt's
Attle Early Ris'ers are the most pleas
it and reliable, pills known to-day.
'hey never gripe. Sold by Jno. H,.
cMaster &; Co.
Banner Wheat Yield,
Messrs. Burnett, Dillard and
boipson, owners of Fernwood
arms,~ near city, are champion
rheat growers, having produced
*,218 bushels of wheat on 40
res-more than thirty bushels
the acre. This is a splendid
ecord, one to be proud of, for
his crop of wheat was made in
e face of bad season and heavy
ains during the early stages of
e crops, doing considerable
amage.-Spartanburg JIournal.
For Over Sixty Years.
Mis. wissow's SCOTHrso smwI
ns been used for over 60 years by mil
ions of mothers for their children
vhile teething, with perfect success.
t sothes the child, softens the gums,
Inys all pain; eures wind colic, and
; the best remedy for Diarrhma. It
-ill relieve the poor little sufferer imn.
iediatly. Sold by druggists in every
)art of the world. T wenty-five cents
bottle. Be sure and ask for "Mrs
Vinslow's Soothin~g Syrup," and take
o other kind.
All's Quiet on. the Potomac.
t's strangely still in Washing
ton,
They miss the Cannon's roar;
?he voice of South Car'Iina' son
No longer thrills the floor.
one is each legislative head
That banged the bills about;
nd Washington is very dead
since Congress has let out!
-Cleveland Plain Dealer,.
. little love, a little wealth.
A little borne for you ~.nd me;
t' atll I ask except good beah,
Tea. Juio. H. McMaster & Co.
If you hear anythicg .creep
ing up behind you, you need not
look around it's probab y only a
ca-idate-News and Conrier.