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THE ARRANTS VOID. NEARLY HALF-MILLION OF TACOMA PAPER DECLARED WORTHLESS. The Supreme Court. in Affirming the Decision of the Local Court, Holds Boggs' Warrant Transactions 11legal They Were Purchased in Violation of the Law and Reissued by Tacoma's Treasurer. TACOMA. June 27.-It will require a close examination of the decision of the supreme court in the Bardsley warrant case to enable the city authorities and those interested in the Boggs warrants to decide just how far-reaching the decision will be. It is conceded that the decision, by which thousands of dollars' worth of city warrants issued between August, 1892. and April, 1894, are held to be invalid and void. is the most important step. that has been taken by the courts in setting the Tacoma warrant muddle, which/has been a disturbing factor in city finances for nearly three years past. Viewed to another light, the decision may be regarded as affecting the transactions in warrants which have been carried on by other city and county treasurers in the state in purchasi or redeeming and then selling warrants issued by the county or city. The supreme court in the Bardsley case affirms the decision of the Pierce county superior court rendered last Mar h, in which it is held that warrants issued by a municipal corporation when once cashed by the treasurer, become canceled, dead and worthless from that time on as an obligation of the corporation. This doctrine, which was laid down by Judge Williamson in a long and carefully prepared opinion. is practically sustained by the supreme court. At this time it is utterly impossible to predict the effect of the decision on Tacoma's municipal finances. The Boggs warrants" have long formed an issue between certain factions in the city, and in the controversy growing out of them much ill-feeling has been engendered. On one side the city has been held up as a repudiator if she failed or refused to redeem the Boggs warrants, or issue funding bonds and with the proceeds take them up. Last summer the city council passed funding ordinance providing for the Issuance of nearly $1,000,000 in bonds, which were to be sold and the proceeds applied to the payment of these warrants, which aggregate. with interest. $1,300,000. This enormous fleating indebtedness was laid on the city during the boom days, when George W Boggs, now of Walla Walla was the city treasurer. The city's running expenses in those days was nearly $60,000 per month In the summer of 1892 warrants for this amount were issued every month in payment of princely salaries, street and sewer improvements and supplies. Although there was then a large amount of general fund warrants outstanding, Boggs, instead of applying the receipts from the tax levies to their redemption. purchased or cashed these current warrants as they were issued and then sold them to bankers and warrant dealers Some of the banks paid him a premium, and it is said that he made $150,000 per year out of the office. This process was kept up till the fall of 1894, when the Taeoma banks began to go under. Then the citizens becoming panicstricken. called on Boggs to desist, but he refused. although threatened with prosecution. Boggs unlawful dealings in warrants were fully exposed by the Post Intelligencer, but the local papers remained silent and often blamed the Post Intelligencer for intruding into Tacoma's muaffairs. nicipal In the winter of 1893-4, the city received from Charles B. Wright of Philadelphia, $330,000 in payment for the extension bonds issued for the purpose of extending the water plant which the city had bought from Wright at a fabulous price. Boggs was short of funds that is, the banks in which he kept the city's accounts were hard pressed for money, holding large blocks of the warrants which he had purchased to keep them from going below par, as they would have done if thrown on the market and which the banks receipted for as cash. In his extremity Boggs caused the council to pass resolution instructing him to invest this $330,000. or a large part of It, in general fund warrants of current issue. The warrants in payment of the police and fire department pay rolls and other expenses of the municipality were issued to Boggs in denominations of $500 and 000. and under the authority of the council Boggs took the money derived from the sale of the water extension bonds and without being exposed in his nefarious work by the local papers, proceeded to establish an "endless chain' which has brought more woe to Tacoma than any of her other troubles. Boggs was terested in a number of banks in which he kept his accounts. and was a heavy borrower In one bank the State Savings, Boggs had a balance of about $90,000 when he went out of office, consisting principally of warrants. The receiver of this bank paid a 10 per cent. dividend In the bank's vaults were found the notes of Boggs and his political friends many of whom have since left Tacoma and who were worthless as security Other creditors of the bank came into court and denied that they had recelved anything for their notes. The note of one of Boggs clerks for a large amount was found in the bank and an expense item for $5,000 haracterized as election expenses' formed another of the 'assets. In another "bank the Tacoma Trust and Savings bank. Boggs was a borrower for nearly $60,000. and President W B. Allen of the bank was indebted to it for $75,000 The receiver has realized practically nothing from these assets. It was in such banks as these that Boggs deposited the warrants purchased with the $330,000 received from the water bonds The warrants have now been decla void by the supreme court It is estimated that Boggs "cashed" between $300,000 and $800,000 of these warrants. Perhaps the former figure is nearer correct although people here who claim to be well posted Tacoma's financial af. fairs assert that the amount is over half a million There was a time when no one without a political pull could get Boggs' to cash a warrant althoug there was no money to meet It. Then they sold at a premium of 1 to 21/2 per cent. The present litigation over the warrants was begun in the fall of 1896 when D. F Murry a member of the fac opposed to the payment of these warrants. began a suit to restrain the city council from 18suing bonds. Judge Stalleup then decided the case In favor of Murry though City Attorney sleford made strong fight for the funding plan. be lieving that every effort ought to be made to ascertain the exact legal status of the warrants Judge Stallcup's decision was couched in language bordering on the sensational, and be severely excoriated Boggs and his official acts Later W Bardsley began a suit to the to pay these warrants and Mr Shackleford assumed an attitude in defense of the City diametrically opposed to his former position This was the of the case Judge W illiamson in March de-
