FINANCING THE INVESTMENT 



it is highly important that the location be one 

 in which tax rates are not excessive. On the 

 other hand, an exceedingly low tax rate may 

 indicate lack of progressiveness in the com- 

 munity and lack of facilities which from many 

 angles would lessen the value of the tract as a 

 place of residence. In most localities, the tax 

 rate is based principally upon the costs of 

 building and maintaining highways and schools. 

 Good facilities in both of these respects are 

 highly desirable, and yet excessive expenditures 

 in either direction may so advance the tax rate 

 as to make them expensive luxuries. 



In many rural communities, taxing districts 

 are burdened with the costs of building monu- 

 mental schools or a very elaborate system of 

 roads, undertaken at some time through the 

 flotation of bond issues. The establishment of a 

 sinking fund for payment of interest and 

 amortization of these bonds frequently con- 

 stitutes a very heavy drain upon the residents 

 of the district. It is, therefore, necessary to 

 determine not only the tax rate in the locality 

 under consideration, but also to know definitely 

 what are the current charges for maintenance 

 of government. Taxing methods vary so widely, 

 even in adjoining districts, that the only method 

 of determining the annual charges for taxes 

 is to secure from the present owner or from the 



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