4 BULLETIN 393^ U. S. DEPARTMENT OF AGEICULTURE. 



made. The bonds, amounting to $500,000 at 5 per cent, run from 

 10 to 50 years under the deferred serial method. 



Lauderdale County, -Miss., which issued $500,000 of 5 and 5^ 

 per cent bonds, adopted the deferred serial-bond method, with the 

 first payment coming 11 years from the date of issue and the last 

 payment 25 years. If the county had issued the bonds on the 6-25 

 year basis the cost would have been $906,875, as compared with the 

 cost on the basis adopted of $972,232, or a difference of $65,367. 



It would seem that the most economical form of bond to issue is 

 the deferred serial with the first payment at the end of the sixth 

 year and the payments then extending to a final term varying in 

 length according to local conditions, but never exceeding 30 years. 

 By having the first payment deferred to the sixth year the county 

 has an opportunity to complete its road system and enjoy the 

 benefits before beginning payment, but if the deferred period is much 

 greater all of the evils of the sinking-fund plan with no corresponding 

 merits are adopted. If local communities throughout the United 

 States could profit by these examples the result would be the saving 

 of many miUions of dollars. 



In one of the counties it was found that an amount probably 

 aggregating as much as $5,000 had been lost to the coimty through 

 a premature sale' of the bonds; that is, in selling the bonds before the 

 funds actually were needed. This resulted in the payment of interest 

 much in excess of that which could be obtained upon cash balances 

 in bank. Counties should pay due regard to this feature of road 

 finance, even though the necessary precautions would save only a 

 small amount. 



MANAGEMENT OF THE IMPROVEMENTS. 



In the eight counties selected several forms of management were 

 in effect and a noticeable tendency was demonstrated on the part 

 of county authorities to select and designate for improvement a larger 

 mileage of roads than the funds contemplated were adequate to con- 

 struct. This was especially true in those counties where a consider- 

 able amount of grading was involved and where comparatively ex- 

 pensive types of construction were contemplated. Naturally these 

 faulty estimates resulted in dissatisfaction and distrust among the 

 taxpayers and to require either additional heavy outlays or the 

 leaving of the project in a partially completed state. Judging from 

 these examples, it is quite obviously essential that where any county 

 contemplates comprehensive improvements involving large outlays 

 and expensive types of construction, the detailed advice and esti- 

 mate of a competent highway engineer be secured before the people 

 are asked to approve the bond issue. In the case of the four Virginia 

 counties the actual work of constructins: the roads after the bonds 



