CAMDEN, NEW JERSEY
During the height of the Depression in the 1930s, Camden, like many other municipalities in New Jersey and the United States, was having problems paying its bills.
During this period the City Government paid its bills through the issuance of Scrip, bills that could be applied against city fees and taxes. Below are examples of such bills, from 1933, signed by Mayor Roy R. Stewart and Commissioner of Finance Harold W. Bennett; and from 1936, signed by Mayor Frederick Von Nieda, and Commissioner George H. Brunner, who would succeed Von Nieda as Mayor.
|Camden Courier-Post - June 25, 1933|
TO PASS MILLION THIS WEEK
Camden city scrip issued since April 1, will reach more than $1,000,000 worth when the city meets its end-of-the-month payroll with a new issue of $220,000 this week for 1500 employees.
County scrip since the first of April totals $481,000, according to County Treasurer J. Wesley Sell. Of that total, $311,000 has been re deemed. A new $25,000 county issue of scrip will be circulated this week in meeting the county payroll for 300 employees.
Of the, city scrip, $610,000 already has been redeemed as taxes, according to records of City Comptroller Sidney P. McCord.
City and county officials said they did not know how much longer they will be issuing scrip or when they would be in a position to announce a definite redemption date.
The officials pointed out that through the issuance of scrip they have been able to meet current obligations and have averted payless paydays for city and county employees.
In addition to operating expenses, the city has to meet a total of $2,415,000 in bonds and interest due between July 1 and the end of the year. McCord said efforts are being made to have bondholders agree to refund these bonds to mature In later years, so that, along with scrip, the city will be able to conserve as much cash as possible. Cash conservation has been difficult, McCord said, because tax collections have been far below those in previous years.
Asked whether the issuance of scrip will enable the city to conserve enough cash to meet the obligations, McCord said he did not know.
County bonds maturing this year total $330,000, but these are to be refunded for later maturity under a resolution adopted by the board of freeholders June 15 which also authorized the refunding of $2,352;000 worth of bonds maturing next year. Sell said the county will not default on any of its obligations,
City Commissioner Harold W. Bennett, director of revenue and finance, said the end of June city payroll of $220,000 will be entirely in scrip, as wall the $48,000 mid-June payroll. It will be the last pay for city teachers until their return from vacation in September.
Bennett pointed out that one of the reasons scrip had to be resorted to was because the city could not borrow the money it needed to pay salaries and operate in anticipation of tax collections. The scrip, he said, conserves what cash the city receives to, meet debt items. Neither he nor McCord said he was free to reveal the amount of cash the City has on hand, nor the amount the city has received since April in proportion to scrip.
McCord said he will not know until the end of the year what affect the issuance of scrip will have on the city's financial situation.
"We won't know until we balance out books at, the close of the year," he said. "I do know that one of the advantages of scrip is that less of it has been issued than the city would have borrowed cash in the market, and so the city saves at least in interest charges.
"Other than to keep the city going, I don't know what financial advantage scrip is to Camden, except perhaps for a saving in interest on loans we could not make. All I know is that scrip has enabled us to meet our payrolls; we don't have to borrow in the market, and we are conserving cash to meet our bonds, interest and other obligations when they come due. Cash receipts, how ever, are slow because of the slump in tax payments.
"The only, way I see for the city to be in a better financial position is for it to receive more of the taxes due it for this and previous years. Non-payment of taxes, with delinquencies enormous during the last few years, has been one of the main reasons the city had to go on scrip. Little money was coming in and we couldn't· borrow it as in former years. So the city· had to issue the scrip, a promise to pay with interest. Otherwise it would have been unable to pay its employees and it would have had to default on bonds and interest. Scrip, therefore, has kept the city going and it has been able to meet all its bills as they fall due."
Commissioner Bennett said prompter payment of taxes has been encouraged through the issuance of scrip. Taxpayers receiving it have redeemed it as taxes. In other cases, where they have cash, they have bought the scrip from others and used it to meet their debts to the city. Thus, he said the scrip has been kept in circulation and readily exchanged.
"Merchants of the city are to be commended for their co-operation," Bennett said. "They have received scrip since April for purchases made at their stores. In turn, they have met their taxes with the scrip offered by customers, many of whom have been doing their buying exclusively in Camden since circulation of scrip, thereby stimulating business here.
"In addition, various concerns and. individuals have been buying up the city scrip for investment, saving it for redemption at a later date to profit by the interest it carries.
"Through scrip, city employees have been saved from going without food, clothing and other necessities. We have averted payless paydays, and we are better off than other cities, whose plight is much worse than that of Camden."
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