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15 years but with the right to extend to
25 only upon the three-fifths majority I
just explained to you.
We took this up with some of the legis-
lative leaders, and they, too, agreed that
if it is to be without any restriction they
would rather have 15, but if it is going to
be in this form — and I do not call it a
compromise: I call this reaching the practi-
calities of a situation that may develop in
years to come, giving the State the flexi-
bility it needs in a field which is so com-
plex that its top fiscal advisers and officers
should have their eyes directly attuned to
this problem when and if it comes up.
By so doing you eliminate the answer
which is glibly given: Well, if you make it
25 years, they will all be 25 years. But
this is not so by reason of the manner in
which this provision is drafted.
Now, there is another official of the State
of Maryland whom every legislator knows
about, and who the public gradually is be-
ginning to learn about. He has his name,
rightly or wrongly, attached to something
called a "tax bill", and I am referring to
Dr. Paul Cooper, the head of the Fiscal
Research Bureau. I laid this matter before
him, and his answer was the same as Mr.
Rennie's, the former Director of the Budget,
and his answer was the same as Mr. Luet-
kemeyer, and the same as other members
of the General Assembly.
Now, with this, our Committee has ap-
proved this provision: "All state indebted-
ness shall mature within 15 years from the
time when such indebtedness is incurred,
except at the time of authorizing the in-
debtedness the General Assembly may ex-
tend the period to not more than 25 years
by the affirmative vote of three-fifths of all
the members of each house."
We believe that what we have done in
the committee, as I have said, is to give us
the 15 year provision that has served well,
to give us the opportunity to go up and
beyond that, whether it is 1G, 18, 24, 25 —
no more than 25 — by a three-fifths vote
it can be done when these occasions arise.
Now, there is another reason for having1
this flexibility. The State of Maryland, hav-
ing this excellent rating, paying- less inter-
est, is in a position where it can aid its own
political subdivisions. One of the greatest
needs in the State of Maryland has been,
and for a long time will be the need for
additional school construction. Those po-
litical subdivisions that are unable to pay
their higher interest rates and pay over a
long period of tima struggle with this prob-
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lem and do the best they can, never quite
catching up.
So, when the State of Maryland says to
them, "You may use our credit for school
construction and pay us back in the 15 year
period," they say, "We cannot do it." The
burden on the county is just too great.
This will mean that when, in the wisdom
of the legislature and the governor there
comes a time when there will be additional
school construction bonds issued for the
benefit of the counties so that the counties
can pay it back, the State will then he in a
position where it can, under such circum-
stances, be of greater aid to the counties
by providing them with a means of paying
back over the longer period of time, up to
25 years.
Now, when you reach this particular
point in the debates there will be several
amendments offered. I find that sometimes
I would that I had not written what I see
before me, because I just got through say-
ing that I do not treat this truly as a com-
promise; but I find that in our work paper
here, our "explanation," we call it, of
course, our memorandum, I say "The ac-
tion of the committee represents a com-
promise."
Do not chastise me too severely. You can
call it a compromise. We think it is the
best end result you can achieve at a time
like this when you cannot guess what is
going to happen in the future.
We are going to ask you to approve what
I have just discussed. You will be asked,
however, by some of the minority who —
by the way, ours was approved by a ma-
jority of 11 to 3, with one abstention. You
will be asked to take the other view, to
hold it down to 15 years.
We think this is a mistake. We think it
is a serious mistake. You will be asked to
g-o to the other extreme of taking- out any
maturity date. We think that is a mistake,
a very serious mistake. We hope that when
that time comes you will adopt the views
of the best advice available on this subject.
Now, while I am talking about it, I
want you to know that we have had the
advice of bankers and investment people.
They are just as interested in the State,
even though they are in the banking- busi-
ness, as any person here present. They
have given us their advice. They, too, have
said this is the perfectly satisfactory way
of accomplishing- what the State is seeking;
namely, to hold on to what you have. Try
to keep the flexibility for what may some
day be needed.
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