740 AGRICULTURAL ECONOMICS 



$10 per acre, which furnished sufficient security for a debt of less than 

 $2 per acre. By supplementing the drainage with additional work, 

 an efficient system was produced. At the present time all of this land 

 is in cultivation and is worth from $75 to $150 per acre. The bonds 

 matured serially from two to fifteen years, the interest was always 

 promptly paid and the different instalments retired at maturity. 

 The taxes amounted to but a few cents per acre, were not burdensome, 

 and were gladly paid. I watched the payment of these bonds and 

 the development of this land with a great deal of interest because it 

 furnished a concrete example of the organization of a drainage dis- 

 trict, the completion and satisfactory maintenance of the work, and 

 the prompt payment of the principal and interest of the bonds. At 

 the present tune the district is out of debt and its excellent record is 

 a justification of the issuance of drainage bonds and their purchase by 

 conservative investors. 



Another district, organized fifteen years ago, embraced 100,000 

 acres and issued $200,000 of bonds maturing within twenty years. 

 The work was completed promptly, has been efficiently maintained, 

 and the land is in cultivation and covered with substantial improve- 

 ments. Although but five instalments of the bonds are outstanding 

 the district has surplus funds to cover the last two instalments and 

 will probably only collect three additional tax levies. Fifteen years 

 ago this land was worth $15 per acre; today the average value is at 

 least $100 per acre. 



Another district, organized five years ago, embraced 45,000 acres 

 of land and issued $350,000 of bonds. The drainage system is com- 

 plete and 75 per cent of the land is in cultivation. Five instalments 

 of the tax have been paid without controversy and three serial 

 maturities of bonds retired, leaving fifteea more to be cared for. At 

 the present rate, all of the district should be in cultivation within two 

 or three years, and it is evident that the remaining taxes will be 

 promptly paid so that the bonds may be retired on or before maturity. 

 Since the organization of this district the land has doubled in 

 value. 



The merits of drainage bonds are obvious. They present a com- 

 bination of highly advantageous features. It is, therefore, only a 

 natural result that they should be attractive to investors desiring a 

 bond payable by taxation, free from income tax, and yielding a higher 

 rate than is offered by direct obligations. These qualities insure a 

 great demand. We can also foresee the supply for this demand 



