I 
 
4 6 / 
 I s-s-f 
 

MUNICIPAL 
 
 FINANCES AND ACCOUNTS 
 
 AND 
 
 RELATIVE LEGISLATION. 
 
 BY 
 
 WILLIAM POWIS, F.C.A. 
 
 READ IN MANUSCRIPT 
 
 TO 
 
 THE INSTITUTE OF CHARTERED ACCOUNTANTS OF ONTARIO, 
 
 BY REQUEST 
 
 TORONTO, 20th DECEMBER, 1888, 
 
 WITH 
 
 A SUPPLEMENTARY PAPER 
 
 ON 
 
 MUNI C1P A L A I) MIN1S T E A T10 N ■ 
 
 TOKONTO; 
 
 EOWSELL AND HUTCHISON, PRINTEIiS. 
 
^ Cs'vsA'*^V\ 
 
 Entered according to Act of the Parliament of Canada in the year one thousand 
 eight hundred and eighty-nine, by William Powis, in the office of the 
 Minister of Agriculture. 
 
 All rights reserved. 
 
MUNICIPAL 
 
 FINANCES AND ACCOUNTS 
 
 AND 
 
 RELATIVE LEGISLATION. 
 
 LEGISLATION CONCERNING MUNICIPAL AFFAIRS. 
 
 In entering upon the consideration of municipal affairs, so 
 vast is the subject in its comprehensivene.ss, and so diversified 
 the subject matter, that the stoutest heart might reasonably 
 feel overwhelmed whilst contemplating the extent of the scope 
 afforded for the exercise of thought, and the application of one 
 man’s limited experience. 
 
 The only way to arrive at satisfactory results, is, for each 
 member of each community to contribute, as occasion may arise, 
 that which his own talents and experience enable him to suggest, 
 in the interest of the public at large. 
 
 As it is generally understood that, the Provincial Parliament 
 will, at the approaching session, take into consideration municipal 
 affairs, and legislate thereon, I have been requested by the secre¬ 
 tary of our Institute, to contribute a paper on a branch of the 
 subject, upon which it is desirable, that, accountants should 
 express an opinion. The necessity, at the present time, for an 
 expression of opinion from some source, competent to judge, is so 
 apparent, that to omit it, would seem to involve culpable negli¬ 
 gence, on the part of some one or some body of men. I trust I 
 ma}" be pardoned for adding, that, the same necessity is apparent, 
 as regards other branches of the same subject. 
 
 While placing before you the results of m\^ study of this branch 
 of the subject, I would ask every hearer or reader of what I 
 have to say, to pause and probe deeply into the merits of every 
 suggestion, before condemning what may not, at first sight, appear 
 appreciable. 
 
4 
 
 The subject is so pregnant with intrinsic interest, that, I trust, 
 my hearers will consider the merits of the thoughts sought to be 
 conveyed, and not the manner in which the ideas are expressed. 
 
 MANAGEMENT. 
 
 In the management of municipal affairs, there should be (tem¬ 
 pered with prudence and caution) a bold and comprehensive 
 policy pursued; in each case, looking to the welfare of the whole 
 municipal community, in the future as well as the present. 
 
 MAYOR, WARDEN, OR REEVE. 
 
 The Revised Statutes, chapter 184, section 244, (see page 1832),. 
 in the recital of the duties of the head of each municipal council, 
 supplies us with this eloquent sentence, [that it shall be his duty] 
 
 “ to communicate from time to time to the council all such informa¬ 
 tion, and recommend such measures within the powers of the 
 council as may tend to the improvement of the finances, health, 
 security, cleanliness, comfort, and ornament of the municipality.’' 
 
 It were well if every aspirant to this honorable position, and 
 every elector, would bear in mind the onerous duties of this office 
 when effectively filled. Electors should endeavour to secure the 
 best man available for the position ; who should be possessed of 
 the ability, and be able to command the time, necessary for an 
 efficient discharge of the duties. No one should offer himself, or 
 encourage the ratepayers to elect him, unless he intends, and is in a 
 position, to devote any amount of time necessary to master the 
 situation, and fulfil its requirements. 
 
 CLERK. 
 
 The position of clerk is one of the most, if not the most, 
 important of the offices to be properly filled. The mayor, warden, 
 or reeve, it is true, is the head of the executive as well as the 
 governmental organization. The councillors, along with him, 
 constitute the controlling power or governing body of the muni¬ 
 cipality. These, however, are elected annually, affording an 
 excellent opportunity for the introduction of new ideas and the 
 operation of diversified talents. The clerk, however, is intended 
 to be a permanent officer for life. 
 
In order to force into prominence the idea I wish to convey, 
 suffer me to style the mayor president and the council a board of 
 directors. Then who and what should the clerk be but manager 
 under their control ? 
 
 To ensure good management, there must be some one permanent 
 officer to take an interest in all the affairs of the municipality. 
 He should devise, contrive, and arrange schemes for its benefit, 
 whether general or departmental. He should bring before the 
 mayor, warden, or reeve, as the case maybe, anything and every¬ 
 thing which occurs to his mind as affecting the interests of the 
 municipality, whether resulting from his knowledge, wisdom, or 
 excogitations. He should inform, and seek to guide, the council 
 on all matters where it appears to him that they might otherwise 
 err. Who is there, of all the permanent officers, in a position to 
 do this but the clerk? Unlike the government elected annually, 
 he has had the opportunity of hearing the ideas and arguments of 
 the several members of the various councils, at the board and in 
 committees, and is conversant with the prevailing opinion on each 
 matter dealt with. He has also been in a position to trace the 
 results in detail of the various acts of each council. 
 
 If I am right in my high conception of the nature of the duties 
 which should devolve upon the clerk of each municipalit}^, the 
 greatest care and pains should be taken to secure the best talent 
 available for the position. The right man in the right place” 
 in this connection is a treasure, though he be not in the treasury 
 department. 
 
 'fhe clerk should be relieved of all details not necessarily and 
 unavoidably appertaining to his office ; so as to give him the 
 fullest possible opportunities of exercising his talents and experi¬ 
 ence, in the general oversight of the municipal affairs, and in 
 devising and suggesting measures with a comprehensive view to 
 the permanent maintaining of a consistent and progressive policy. 
 
 The provisions of section 245 (page 1833) that the clerk “shall 
 keep the books, records, and accounts of the council, and shall 
 preserve and file all accounts acted upon by the council,” is a 
 great mistake; and as far as I am aware, very generally disre¬ 
 garded. The treasurer should keep the vouchers; and so long as 
 there is no separate office of accountant, the treasurer is the party 
 
6 
 
 who should keep the books and accounts recording the fiscal 
 transactions. 
 
 Section 250 (page 1834) makes the treasurer simply the banker. 
 DEBENTURES. 
 
 A very important matter in the management of municipal 
 affairs, is the governing of the debenture debt; both as regards 
 its amount and maturity, and the value and durability of what 
 has been procured thereby. 
 
 Debt. —It is often wiser and more economical, to incur a large 
 debt for durable works of great utility, than to keep down the 
 debt at the sacrifice of other important considerations. At the 
 same time, while judicious expenditure, that can only be accom¬ 
 plished by borrowing, is commendable, the amount of debt should 
 be watched and adjusted so that it may not grow beyond the 
 limits of prudence or justice. 
 
 Powers. —When debentures are issued, they should never be 
 made payable at a date beyond the time when the works thus 
 paid for are expected to be worn out, renewed, or replaced. This 
 I am happy to say is required by existing law. See section 621, 
 sub-section 2 (page 1991.) 
 
 Permanent works which might last for centuries, the construc¬ 
 tion of which might be the truest economy, should in my opinion 
 be the occa^^ion of debenture issues at very long dates. What 
 has been contemplated in the framing of the statutes with respect 
 to this matter, is difficult to ascertain, as the provisions are 
 inconsistent. 
 
 Section 340, sub-section 2, (page 1860) provides that if the 
 debt be “ not contracted for gas or water-works, or for the 'pur¬ 
 chase of public vjorks,” the debentures “ shall be made payable in 
 twenty years at furthest, and if the debt is contracted for o-as or 
 water-works, in thirty years at furthest.” This leaves i^open 
 as to the date of payment of debentures issued for public works 
 other than gas-works or water-works. 
 
 Chapter 190 section 17, sub-section 6, (page 2057) authorizes 
 the issue of Park debentures payable in forty years. This is 
 quite in accordance with the provisions of chapter 184, section 
 340, sub-section 2, referred to. 
 
7 
 
 In chapter 184, section 342, sub-section 1, (page 1861) referring 
 to re-payment by annual instalments, the time is limited as 
 follows: “ not exceeding thirty years, if the debt is for gas or 
 water-works, and not exceeding twenty years if the debt is for 
 any other purpose,” 
 
 By these provisions, while debentures payable by annual 
 instalments, other than those issued for construction of gas or 
 water-works, must be made payable within twenty years, even 
 though they be issued for parks or works ; debentures for parks 
 may be issued payable in one sum in forty years, and for works 
 at unlimited date if payable in one sum, provided they be not 
 for gas or water-works, and that they be made payable “ within 
 the probable life of the work,” (section 621, sub-section 2.) 
 
 As payment by instalments, is the surest and safest means of 
 securing redemption, the technical rendering of the enactments 
 can scarcely be the intention of the legislators. 
 
 I am of opinion, that, there should be no restriction as to 
 date of payment of debentures issued for permanent works, pro¬ 
 vided that the provisions of section 621, sub-section 2, be strictly 
 adhered to. There is a vast difference between the most inde.s- 
 tructible and the mo.st perishable of public works; and almost 
 all shades of difference between the two extremes. Many 
 improvements may very properly V)e the occasion of debenture 
 debt, with great financial advantage, and yet not warrant defer¬ 
 ring redemption, even for twenty j^ears. 
 
 On no account should permanent debentures be issued by any 
 municipality, unless and until, permanent and comparatively ever¬ 
 lasting works have been acquired to an equivalent value. Deben¬ 
 tures issued for payment of land purchased for a public park, 
 may be made permanent, not only with prudence and propriety, 
 but with the greatest possible attending benefit to the community. 
 I assume, that, as a matter of common sense, legal restrictions 
 will be enacted governing the issue of permanent debentures 
 This being done, of course property so purchased, will be required 
 to be permanently and untransfer ably vested in the municipality; 
 unless and until powers of sale given to the holders of the deben¬ 
 tures is exercised, owing to non-payment of interest. Thus the 
 painful and shameful calamity can never happen to the inhabitants 
 
8 
 
 of seeing their city oases encroached upon until they grow into 
 nothingness. The amount expended in transforming the natural 
 land into a beautiful park, may justly and quite properly be added 
 to the amount of debentures made permanent, to the extent of the 
 value of the improvements that are permanent. More latitude 
 can be allowed in the case of land, than in any other investment, 
 because, in cities, the old saying, “ res crescunt,” is usually applic¬ 
 able to the value of land. The purchase of land of any kind by 
 a municipalitj’^ may and should be the occasion of the issue of 
 permanent debentures. Justice to the rate-payers demands it. 
 Nothing but land, unless there could be a municipal monopoly of 
 air or water, should be purchased with the proceeds of perma¬ 
 nent debentures. Buildings constructed of blocks of granitoid 
 stone, adhered to each other by thin layers of cement instead of 
 mortar, on an indubitably solid foundation, which might last for 
 many centuries, might at first sight seem to warrant the issue of 
 permanent debentures for their construction. It is far better, how¬ 
 ever, to make the debentures payable at some very long date, as 
 nothing can be absolutely everlas ting but the land. The date of 
 payment may, however, be so far remote as to reduce the annual 
 sinking fund to a comparative trifle. 
 
 The ju'inciple governing the date of payment, in justice to the 
 latepayers, both of the future and the present, should be, as far 
 as is possible, to make the period during which interest and 
 sinking fund are being paid, agree with the period during which 
 the inhabitants or owners for the time being are enjoying the 
 results of the application of the funds borrowed. A careful con¬ 
 sideration of what I have said will convince the hearer or reader 
 that, if the principles I liave enunciated be strictly adhered to, 
 this result will be accomplished as nearly as the mists which veil 
 the future will admit of. 
 
 Exercise of Powers. —Should any municipality have become 
 involved to an extent rendering it inconvenient to the ratepayers 
 to meet the obligations, it would be right and extremely convenient 
 to adjust the payments by reorganizing the debt on the principles 
 I have laid down. That is, to issue permanent debentures for 
 land acquired, and other debentures at various dates corresponding 
 with the expectant life of each work respectively, the proceeds to 
 be applied in purchasing and redeeming existing debentures. 
 
9 
 
 In considering the expediency of incurring any debenture debt, 
 of course it is unnecessary to say, that, the first question to be 
 looked to, is, the ability of the ratepayers to meet the interest and 
 sinking fund, without having to pay an excessive rate of taxation. 
 In this connection, however, the result of the work forms a very 
 important element. The work to be undertaken may replace that 
 which is a source of great expense. Then again the construction 
 of the new work may be calculated to increase the ratepaying 
 power of the municipality. 
 
 Before any work is undertaken, or estimates therefor adopted 
 or anj; by-law drafted for authorizing an issue of debentures, a 
 careful comparison should be made of the relative annual cost to 
 the ratepayers, of all the various modes of construction that are 
 worthy of consideration The sinking fund necessary to be set 
 aside annually, is so very much less in proportion to the debt, on 
 long date debentures, than on those of comparatively short date, 
 that this question is of vital importance, assuming, as I do, that 
 power will be given (if indeed it does not alread}^ exist) to issue 
 debentures at any date warranted by the durability of the work.s. 
 The effect of compound interest on the annual amount invested as 
 sinking fund, is such, that by deferring the time for the ledemp- 
 tion of the debt, a work of much greater durability, utility, or 
 other advantage, may be secured at the same annual cost to the 
 ratepayers. 
 
 I give an example here, which it must be remembered is not 
 adjusted from actual estimates of any work, but is only for the 
 purpose of illustrating the principle. 
 
 A certain work is proposed. The engineer reports that it can be 
 constructed for 8500,000, but that if another $200,000 be expended, 
 it can be made almost indestructible. An estimate is made of 
 the relative cost to the ratepayers as follows: 
 
 Amount. Tine. Sinking Fund. Interest. , , 
 
 Annual Kate. 
 
 $500,000. . . .20 yeans,. . .. $15,121.30. . . .$25,000. . . .$40,121.80 
 700,000 - 50 years, - 3,343.72_ 35,000_ 88,343.72 
 
 The interest, as you will see, is assumed to be 5 ])er cent. The 
 valuation of the yearly sinking fund is made at the same rate, 
 capitalized yearly according to law. 
 
 2 
 
10 
 
 Assuming interest to be 4 per cent, the figures will be : 
 
 Amount. Time. Sinking Fund. Interest. Total. 
 
 $.500,000. ... 20 years . . . .$16,790.87. . . .$20,000. . . .$36,790.87' 
 700,000. ... 50 years .... 4,585.14. . .. 28,000. . . . 32,585.14 
 
 I have computed the annual amount of sinking fund according 
 to present law—compounding the interest yearly. 
 
 It should always be the aim of municipal boards to secure 
 works that will outlive the redemption of the debts incurred for 
 their construction. This re.sult is more likely to be attained by 
 acquiring works of the greatest durability,notwithstanding defer¬ 
 ment of redemption. The nearer the approach is to the everlast¬ 
 ing, the least costly is the work in the end. 
 
 RECITAL OF DEBTS. 
 
 The provisions of chapter 184, section 628, sub-section 2 (page 
 1996), excluding from the recital of debts of a municipality, in 
 its by-laws, debts incurred on the security of local assessments, is 
 a radical mistake. It is well to state how much of the debt is 
 thus secured, but full particulars are justly due to purchasers of 
 debentures, and when given tend to increase the standing of the 
 municipality at home and abroad. 
 
 REGISTRATION. 
 
 The provision of section 353 (page 1865) is, if possible, still more 
 strange and unaccountable. It provides that debentures issued for 
 local improvements, may or may not be registered, at the option 
 of the municipality. The utility of registration is greatly lessened 
 thereby. Not only should reference to the registry office reveal 
 the general debt, but every debt of the municij^ality. Indeed debts 
 for local improvements call for registration more than gene¬ 
 ral debts, because a special and preferential lien on certain 
 properties is thereby created, and such lien should be exhibited 
 by the records of the registry office for reference concerning the 
 properties affected. There is no valid reason why the registry 
 office should not exhibit every lien upon the municipality as a 
 whole or locally, just as fully as in the case of separate properties 
 held by individual owners. It is needless to add that every 
 cancellation of a b 3 '-law .should also be registered. 
 
11 
 
 SINKING FUND. 
 
 Computation. —Section 340, sub-section 4, (page 1860) provides, 
 that, in estimating the sum to be raised annually as sinking fund, 
 the interest is to be capitalized yearl 3 ^ As almost all debentures* 
 bear interest payable half yearly, the statute should read “ capital¬ 
 ized half-yearly on a yearly estimate.” The amount provided as 
 sinking fund, may be assumed to be raised annually, but so soon 
 as the annual amount is actually invested, it bears in most, if not 
 in all, cases, half-yearly interest, and such interest is, or should be 
 re-invested immediately it is received. 
 
 Adjustment. —Each year, before placing in the estimates the 
 amount required to be raised for sinking fund, under the var¬ 
 ious by-laws, a valuation should be made to ascertain whether the 
 existing investments have amounted to the sum originally com¬ 
 puted as that which would be on hand at that date. If the fund 
 be deficient it must be augmented by adding the necessary 
 amount to the ordinary yearly appropriation. 
 
 If it be found that the rate of interest being realized is less than 
 that assumed in making the original computation, the annual 
 amount to be set aside as sinking fund must be re-estimated on 
 the basis of the decreased rate of interest. 
 
 Should it be the case that any municipality has neglected these 
 necessary precautions for some years, it would be well in such 
 instances to cover present deficiency in the computation of the 
 necessaiy annual amount in the future. 
 
 If these precautions are taken, fractional adjustments are 
 effected from year to year, which prevent the possibility of such 
 an awkward predicament as that of finding the fund short when 
 the debentures mature. 
 
 Should any work become useless or require renewal before the 
 debentures issued for its construction are redeemed, if it is prac¬ 
 ticable, provision should be made for setting aside the present 
 value of the interest and sinking fund to mature in respect of 
 such debentures before other debentures are issued for re-con¬ 
 struction. 
 
 Investment. —I am very decidedly of opinion that the invest¬ 
 ment of the sinking fund should, as far as is possible, be the 
 purchasing of the debentures of the same municipality. This 
 
12 
 
 system has all the advantages of paying debentures by instalments, 
 while at the same time it does not interfere with the profitable 
 sale in the first instance. There is no risk of loss, and there are 
 no collections to make in realizing on investments. 
 
 A municipality quietly buying in its own debentures creates a 
 demand for them in the market. The result is, that, investors 
 finding at all times a ready sale for them at good prices, the 
 demand increases and is always brisk. The tendency is, to enable 
 such a municipality to decrease the rate of interest on subsequent 
 issues. 
 
 It must, of course, be borne in mind that, if the sinking fund 
 is so invested, the amount of the coupons must be paid to sinking 
 fund and invested in that behalf, the same as though the deben¬ 
 tures bought were those of another corporation. 
 
 EXPENDITURE. 
 
 The period between the elections and the time for striking the 
 rate, should be largely occupied by the council in discussing the 
 entire needs of the municipality. In dealing with the question of 
 ]-epairs, it should, in each instance, be deliberately considered 
 whether a new w’ork would be less expensive in the end, than 
 patching and mending for temporary necessities. Comparative 
 statements should be submitted, shewing, in each case, what 
 annual amount would be necessary to provide for interest and 
 sinking fund to secure a new work, and what amount would 
 otherwise be necessary for ) epairs. 
 
 The interests of the several wards or parts of a municipality 
 should be duly considered, but not in such a way as to lose sight 
 of the general welfare of the whole. II' from any cause there 
 remains a balance unexpended of the previous year, it is right 
 and equitalj^e that such surplus should be credited to the wards 
 or divisions, in proportion to their contributions as per assessment 
 rolls. If this were done, there would be less jealousy regarding 
 the amount expended in each division in an}^ particular 3 ^ear. 
 Expenditure in this cojmection, not provided for by local taxa¬ 
 tion, would, of course, be charged respectively. It is not neces¬ 
 sary that, in each and every year, a proper ]>roportion of the 
 taxes raised and available, should be actually expended in that 
 
18 
 
 year, in eacli locality. One ward may be allowed certain improve¬ 
 ments in one year, and another in another 5 ’ear. The necessities 
 in each case should be considered for the time being, while the 
 permanent standard should be maintained. 
 
 If the council is aware, that, from any cause, the ratepaying 
 power of the municipality is weak during the year current, and 
 there is a balance unexpended of the taxes of the previous year, 
 it is right to appropriate such balance towards the reduction of 
 the taxes for the current year. 
 
 STRIKING THE RATE. 
 
 Chapter 184, section 357 (page 1867) provides, that, the aggre¬ 
 gate rate, exclusive of school taxes, must not exceed two cents in 
 the dollar on the actual value As such a rate, on a five per cent, 
 valuation, would be equal to forty per cent, of the income, in 
 addition to school rates, it needs no ai’gument to show that such 
 extreme limit should never be a})proached. It is my opinion that, 
 with the qualification of sub-section 2 , the limit .should be reduced 
 nearly one-half. 
 
 In striking a general rate, the various local assessments should 
 always be taken into consideration, because the owners or inhabi¬ 
 tants in each locality, cannot be supposed to be able to bear an 
 excessive rate of taxation, even though they have improvements 
 peculiar to themselves. School or other general rates, to be levied 
 separately, must also be taken into consideration for very similar 
 reasons. 
 
 The e.stimates should be considered in order ; 
 
 1 . Demands for government, county, law, school, or other e.sti¬ 
 mates of amounts to be raised separately or otherwise. 
 
 Interest and sinking fund for the year, including amount, if 
 any, neces.sary to adju.st the sinking fund. * 
 
 Unpaid claims of all kinds, matured and not satisfied or provi¬ 
 ded for. 
 
 Local assessments of all kinds. 
 
 2 . Expen.ses. 
 
 3. Contingent expenses. 
 
 4. Repairs. ^ 
 
 5. Improvements. 
 
14 
 
 The first group of items must be provided for. 
 
 If current expenses added, requires a heavy rate, each item of 
 expense should be carefully considered, with a view to possible 
 retrenchment. 
 
 If the question of repairs has been duly considered, in relation 
 to new works, this item can be intelligently dealt with at the 
 meeting. 
 
 The securing of improvements out of current revenue, can only 
 be entertained when provision for the other items would require 
 blit a low rate of taxation. 
 
 If it be clearly seen, that, improvements of a temporary nature 
 not warranting debenture debt, can be accomplished out of rates 
 to be levied, it is well to arrange that the cost of the improve¬ 
 ments decided upon, be charged to the ward or division benefited ; 
 and that at the end of the year, each ward or division be credited 
 with its proper proportion of the surplus of taxes after providing 
 for the unavoidable expenditure. By this system, it will be seen 
 from year to year, what the relative claims of the various wards 
 or divisions are, upon the general funds. At the same time it will 
 prevent wasting the funds, by dividing them for expenditure in 
 each year. 
 
 Should it be found that the rate necessary to provide for the 
 entire estimates is extremely low, it is well to consider whether 
 any circumstances will probably necessitate a much higher rate in 
 the following year. Also to antici|)ate improvements not war- 
 1 anting debenture debt, but* yet too costly for the amount to be 
 levied in any one year. 
 
 Provision may very properly be made to meet such future 
 demands, without inconvenience to the ratepayers, by adding a 
 suitable portion of the prospective expenditure to the amount of 
 the estimates, to be covered by current assessment. 
 
 It may often occur that, by husbanding the resources of two 
 or more years, preparation may be made for more satisfactory 
 repairs or improvements than could possibly be effected by 
 spending each year the total amount collected. 
 
 In computing the amount of taxes resulting from a given rate 
 due allowance must, of course, be made for unrealized taxes under 
 such rate. 
 
15 
 
 ASSESSMENT. 
 
 The principles adopted in legislating should, by enactment, be 
 applied consistently and equitably ; and due means should be 
 provided for carrying out the system imposed. The provisions 
 of the Assessment Act, chapter 193, Revised Statutes, are very 
 far from meeting these requirements. 
 
 Section 31 (page 2099) provides, that interest on debts owing 
 ma}- be deducted from amount of income to be assessed. 
 
 Section 7, sub-section 21 (page 2088), provides, that debts 
 owing, not secured on real estate or due or owing on a purchase 
 of real estate, may be deducted from the value of the personal 
 property to be assessed. 
 
 Observe here, that, as regards personal property, the principle 
 is established that liabilities are to be deducted from assets. 
 
 Sub-section 16 of the same section provides, that, mortgages 
 upon land, or balances due for sale of land still held, and deben¬ 
 tures of the Dominion, Province, or any municipality are exempt. 
 
 Sub-section 26 incidentally mentions, that interest on mortgages 
 is not exempt. It reads, “ Rental or other income derived from 
 real estate, except interest on mortgages.” 
 
 I have not observed anj^ mention in the Act, of interest on 
 debentures, but as sub-section 16 ends with these words, “and 
 such debentures,” and as debentures carry coupons representing 
 the interest, the inference is, that, even the interest on debentures 
 is exempt. 
 
 Sub-section 19 provides, that, stock in railway companies, 
 building societie.s, and companies for lending on real estate, is 
 exempt, but that the income derived therefrom .shall be assessed. 
 
 Sub-section 17 provides, that, stock in banks is exempt, and 
 that only the income derived .shall be asse.ssed. 
 
 Section 34, sub-section 2 (p. 2100) provides, that, the personal 
 property of banks, railway companies, and certain other corporate 
 bodies is exempt; but that the shareholders shall be assessed on 
 the income they derive from such companies. 
 
 Mortgages. —It will be seen that, the principle of deducting 
 liabilities from assets, has been established by law, in asses.sing 
 personal property. Why should not the same principle be carried 
 out in assessing real property ? 
 
16 
 
 Tlie holder of a mortgage is, practically, the holder of the real 
 estate. The equity of redemption is all that is held or owned by 
 the nominal holder. Technically the mortgagee is the owner or 
 holder, subject to this equity of redemption. 
 
 So long as the nominal holder of real estate is assessed for 
 the full value, notwithstanding encumbrances existing, it is right^ 
 that neither the individual holder of a mortgage, nor the com¬ 
 pany advancing money thereon, should be also assessed for any 
 portion of the value of such property ; nor indeed for the inter, 
 est, ail}’ more than if it were rent ; but why should not each 
 party pay taxes for the proportionate interest he holds in such 
 real estate ? 
 
 This question is of much greater moment than would be sup- 
 ])osed at a superficial glance; and the ramifications of the evil of 
 thus viewing assessments from an erroneous standpoint are 
 almost illimitable. 
 
 At first sight, it M^ould appear that, from a municipal point of 
 view, it matter.? little who pays the taxes, so long as they are 
 secured on the real estate. On consideration, however, it will be 
 found, that, a principle underlies this question, which materially 
 affects other provisions of the law, by which a large amount of 
 what should be assessed is exempted from taxation. This amount 
 goes on increasing, year after year, as fast as capital is withdrawn 
 from active business. 
 
 Before pnssing on to the question of exemptions generally, let 
 us pause and consider the working of the assessing of real estate 
 under existing law. 
 
 One man invests his capital in real estate ; he must pay taxes 
 on the full value. Another man lends his money on the security 
 ot real estate and the personal security of the borrower ; he is 
 free from taxes except as regards those levied on the amount of 
 the interest earned. Is this right ? 
 
 Again, a man borrows money on his real estate, to improve it 
 Redoes not add to his capital thereby; he only increases the 
 value of the property which he'then only nominally , holds. He 
 must pay taxes on the increased value, wnile the ca}.ital lent to 
 him IS free from taxation except as regards interest. Is this 
 right ? 
 
17 
 
 Again, a merchant mortgages his real estate for a certain sum, 
 and puts the money into his business. He must pay increased 
 taxes to the extent of rates levied on this additional amount of 
 personal property, while no reduction is made on the taxes pay¬ 
 able by him on his real estate, although his capital has not been 
 increased. Is this right ? 
 
 Once more, one man rents a farm from the owner; he pays no 
 taxes on the land. Another owns a farm subject to a mortgage, 
 the interest upon which would represent the rental of more than 
 half his farm ; he has to pay taxes on the whole value. Is this 
 right ? 
 
 I have no prejudice in favour of one class of the community any 
 more than another. My object is to contribute ideas towards 
 the solution of questions affecting the well-being of the commun¬ 
 ity at large. While I assert with emphasis that the capital invested 
 in mortgages should be taxed as against the mortgagees, and the 
 nominal holder of land relieved to that extent; I fail to see why 
 the holder of a mortgage, who thereby acquires an interest in a 
 property miles away from the boundary of the municipality in 
 which he lives, should be taxed where he may happen to reside, 
 even on the interest he derives from this investment. The mere 
 fact of his living in a certain municipality and spending his income 
 there assists many other classes of ratejmyers to meet their just 
 taxes. Indeed I cannot see why interest on mortgages should be 
 taxed at all any more than rental. The taxes have been paid by 
 some one on the whole property from which such income has been 
 derived. 
 
 It is within the verge of possibility, if not probability, that 
 the taxes on certain farm lands might be even less than city 
 taxes on the income derived therefrom. 
 
 It may be argued, that, in the case of city properties, the assess¬ 
 ing of mortgagees, as owners of real estate to the extent of the 
 claims under such mortgages, would only have the effect of 
 increasing the rate of interest charged on such loans. We have 
 nothing to do with this, in the discussion of municipal affairs, any 
 more than we have with the effects produced on the price of goods 
 by taxing the personal property of the merchant. These things 
 must adjust themselves from the result of competition and the 
 3 
 
18 
 
 proportion which supply bears to demand. What is right should 
 prevail, and the issues will take care of themselves. 
 
 Assuming that my views were endorsed by the public at large, 
 the next question is, how could they be carried out ? I would 
 say by a very simple process. Section 24 (page 2097) provides 
 that, “ any occupant may deduct from his i-ent an}'- taxes paid by 
 him if the same could also have been recovered from the owner 
 or previous occupant, unless there is a special agreement between 
 the occupant and the owner to the contrary.” The liability, once 
 established by law, a clause of similar purport to above, is all that 
 is necessary. In the ease of a property occupied, this would suffice 
 for the convenience of both mortgagor and mortgagee. In the 
 event of a property being unoccupied, the mortgagee has to look 
 after taxes to secure himself even under existing law. 
 
 Personal Property. —It will be seen, by the provisions of 
 the Assessment Act, that the farmer, manufacturer, or merchant 
 is to be assessed on the amount of capital invested in his busi¬ 
 ness ; while the man, who, having accumulated capital, has with¬ 
 drawn from active enterpiise and invested his money in deben¬ 
 tures, loans on real estate, bank or railway stocks, &;c., is only 
 assessed for the amount of interest earned thereon; and appar¬ 
 ently not even for all of that! Is this right ? Is it just ? Is it 
 equitable ? 
 
 The law governing assessment should provide for the consis¬ 
 tent carrying out of some well-defined principle. Either incomes 
 should be assessed in all cases, or capital, no matter how invested. 
 
 There are grave difficulties in the way of carrying out the 
 income basis, both as regards unproductive real estate, and vari¬ 
 able and nnascertainable incomes. These matters are so well 
 understood That it is needless to enlarge. Assuming then, that 
 the basis must, of necessity, be that of capital, it becomes neces¬ 
 sary to assess every member of the community on this basis. 
 
 Why .should he who makes a large percentage on his capital, 
 accompanied by heavy risk, in active business, pay taxes on his 
 capital, while at the .same time, one who has retired from active 
 business, and earns a smaller percentage with less risk, pays only 
 on a portion of his income, reckoned as his capital ? It is simply 
 absurd! On an income ba,sis, each would be assessed on the 
 
19 
 
 profits earned on their respective investments. On a capital 
 basis, the capital should in every instance be assessed no matter 
 how invested, even though it be only deposited in a bank or laid 
 by in an old stocking. 
 
 Of course, if income be taxed, the capital producing it should 
 not, and if capital be taxed, the income derived therefrom should 
 not. 
 
 It seems perfectly right, not to tax a bank or a railway for its 
 capital, because the stock may be, and usually is, contributed 
 argely from those outside the municipality where the head oflSce 
 is situated. Even locally, the personal property held at the 
 agencies, bears no direct relation to the stock held by the inhabi¬ 
 tants at such places respectively. The same principle, however, 
 applies with equal force to many other corporate bodies. In every 
 instance, the stockholders personally should be asse.ssed. If, how¬ 
 ever, the companies be assessed, the stockholders should not be 
 individuall}’^ assessed for the same capital, nor for the interest or 
 profits earned thereon. 
 
 The taxing of all capital, or all income, as the case may be, either 
 one or the other, exclusively, is of vital importance to each muni¬ 
 cipality, and necessary to its permanent welfare. The exemptions 
 in favour of capitalists out of active business, are simply appalling 
 to the contemplation of the struggling mass of the active popula¬ 
 tion. The very men who ought to contribute the heaviest, are 
 those comparatively exempt from taxation. Debentures! mort¬ 
 gages ! building and loaning companies’ stock ! bank and railway 
 stocks! almost all capital, exempt, not invested in agricultural, 
 manufacturing, or mercantile business ! Every debenture bought, 
 every loan granted on real estate, every share taken in a bank, 
 railway, or building or loaning company, by a farmer, manufac- 
 turei', or merchant, removes so much capital from the reach of 
 taxation. 
 
 If the provisions for assessing were consistent and uniform, the 
 result would be a material increase in the aggregate amount 
 assessable on a capital basis, or the same result to ratepayers on 
 an income basis. More than this, a growing evil would be checked. 
 The comparative depletion in the amount assessable, compared 
 with the increase of wealth, would be prevented ; and the amount 
 
20 
 
 assessed would steadily increase with the increasing prosperity of 
 the commimity. 
 
 Since the compilation of the Revised Statutes, I notice that 
 at the last session of the Provincial Legislature, another exemp¬ 
 tion has been added to swell the lists—namely, farmers live stock. 
 See 51 Vic. ch. 29, sec. 3. Why the live-stock of a farmer should 
 be exempt any more than the inanimate machinery or plant of a 
 manufacturer, I fiiil to see ! 
 
 Personal Earnings. —The provisions for assessing personal 
 earnings, literally construed, are somewhat amusing. 
 
 Among the exemptions named in section 7, sub-section 23 
 (page 2088) reads thus: “The annual income of any person 
 derived from his personal earnings, provided the same does not 
 exceed $700.” The inference to be drawn from this, technically 
 and grammatically, is, that if the earnings exceed $700, neither 
 the whole nor any part is exempt. 
 
 Sub-section 24, however, reads : “ The annual income of any 
 person to the amount of $400, provided the same does not exceed 
 $ 1 , 000 . 
 
 Section 31 (page 2099) provides, that “no person deriving an 
 income exceeding $400 per annum from any trade, calling, office, 
 profession, or other source whatsoever, not declared exempt by 
 this Act, shall be assessed for a less sum as the amount of his 
 net personal property, than the amount of such income during 
 the year then last past, in excess of the said sum of $400.” 
 
 By these enactments it will be seen that, so long as the salary 
 of a clerk does not exceed $700, it cannot be taxed. If, however, 
 it is increased to $750, it must be taxed to the extent of $350, 
 When it reaches $1,050, it must be taxed for the full amount. 
 Surely this cannot have been the intention of the legislators! 
 
 I am of opinion that, if personal eai’nings, whether spent or 
 not. are taxed, there should be some definite fixed sum out of 
 such income declared exempt. For my own part, however, I am 
 quite convinced that income from personal earnings should not 
 be taxed at all. To tax personal earnings is no more nor less 
 than taxing labor. This I conceive to be wrong from every 
 point of view; unsound in principle and unwise in policy. 
 
21 
 
 ASSESSING. 
 
 It is of the utmost importance, both as regards the municipal 
 •treasury and the individual ratepayers, that the valuation of the 
 property assessed, should be as exact as possible ; and that nothing 
 assessable be omitted from the rolls. If this be not effected, the 
 candid and conscientious ratepayers are those who suffer. 
 
 Under-valuation tends to injure the credit of the municipality, 
 because not only does the property appear less valuable than it 
 really is ; but the rate levied is necessarily higher to produce the 
 required amount of taxes. The municipality thus appears to be 
 not only less -wealthy, but also more extravagant, than is really 
 the case. 
 
 It is, however, equally important that there should be no over 
 valuation ; for, not only is this dishonest to the creditors of the 
 municipality, but dangerous to the ratepayers as encouraging 
 heavy taxation. 
 
 Assessors are too apt to err in under-valuing. It is to be feared 
 that this is done to a very great extent, in most cases of personal 
 property, especially where the amounts are large. Why should 
 not the amount in every instance be an exact valuation ? This is 
 required by law, as I shall proceed to show; but if it were the 
 practice, and known to be so, ratepayers would be more candid 
 with asssesors and more likely to reveal correct values. 
 
 In assessing personal property, it would appear that, a guess is 
 ventured, and if there be no appeal, it stands at that amount. 
 
 In valuing real property, it is simply a matter of appraisement ; 
 but how is it possible to appraise the capital of a manufacturer, 
 or a merchant, or the income of a professional man ? 
 
 The theoretical provision of the law is plain enough. Section 
 26, sub-section 1 (page 2097) reads, “ except in the case of mineral 
 lands hereinafter provided for, real and personal property shall be 
 estimated at their actual cash value, as they would be appraised 
 in payment of a just debt from a solvent debtor.” 
 
 How is it possible for an assessor to value the amount of liabili¬ 
 ties in excess of outstanding assets, to know what may be deducted 
 from the visible machinery, tools, merchandise, &c., which are 
 tangible, unless he examines the books in which the transactions 
 ■of each business respectively are recorded ? How is it possible 
 
22 
 
 for him to value the income of a professional man, commission 
 merchant, broker, and such like, unless he is shown all the trans¬ 
 actions ? 
 
 Section 42, sub-section 1, (p. 2101), provides that, “ It shall be 
 the duty of every person assessable for real or personal property,” 
 “to give all necessary information to the assessors, and if required 
 by the assessor,” “ he shall deliver to him a statement in writing, 
 signed by such person (or by his agent,if the person himself is absent) 
 containing all the particulars respecting the real or personal pro¬ 
 perty assessable against such person, which are required in the 
 assessment roll; and if any reasonable doubt is entertained by 
 the assessor of the correctness of any information given by the 
 party applied to, the assessor shall require from him such written 
 statement.” 
 
 How is the assessor to know, in the first instance, whether the 
 information given is correct or not ? What is the practical effect 
 of these provisions ? Immediately an assessor asks for a state¬ 
 ment in writing, he proclaims to the ratepayer that he doubts his 
 word ! When he gets it, he is no better able to judge of its cor¬ 
 rectness in writing than by word of mouth ! Is this, however, a 
 proper position to place the assessor in ? Is he to be expected to 
 make such an invidious distinction between one ratepayer and 
 another ? The statement should, in every case without exception, 
 be made in writing and under oath. Why should not each rate¬ 
 payer be required to make returns of the actual value of his 
 personal property, and be held responsible for his statements, with 
 the same exactitude as would be required of him in respect of 
 imposts or excise duties ? 
 
 ACCOUNTS. 
 
 Before proceeding to enunciate my views regarding the keep¬ 
 ing of municipal accounts it is neces.sary to deal with questions 
 which affect the preparation of the books to be used. 
 
 Arrears.— There should be, in my opinion, a more simple and 
 concise method of dealing with arrears of taxes. It would serve 
 no purpose in view, to recite in this paper the various enact¬ 
 ments from section 140 to 159 inclusive, and those of 204 to 209 
 inclusive, providing the most cumbrous system that could well be 
 
23 
 
 imagined, because if my views should prevail these provisions 
 would necessarily be re-modelled. 
 
 I fail to perceive that any advantage is to be gained by anyone 
 from the reporting of arrears by the minor municipality to the 
 county, unless and until the arrears have reached that point when 
 the land is liable to be soldior taxes. 
 
 After the time has passed during which taxes ought to be paid 
 in each j^ear, a return should be made by the minor municipality 
 to the county, shewing what properties are then liable to be sold 
 for taxes. Only between such date and the day of sale, and oidy 
 concerning such properties as are liable to be sold, should it be 
 necessary to apply to the county officer at all. A sale should be 
 held by the county officer once only in each year, when there is 
 any property liable to be sold. Such sale should be held before 
 the time for striking the rate by the minor municipality. Immo 
 diately after such sale the county officer should make a return to 
 the minor municipality, showing the result of each sale, and remit¬ 
 ting the money collected, after deducting his charges, if he be en¬ 
 titled by law to make any charge. The transactions of each year 
 should thus be closed and balanced. The only record necessary 
 on the part of the county officer is a full account of the circum¬ 
 stances connected with each sale and its result. It is not neces¬ 
 sary that the county officer should keep any further account con¬ 
 cerning arrears of taxes. This system and process .should go on 
 from year to year, the county officer acting each time solely on 
 the new report handed him from the minor municipality. 
 
 It is quite immaterial, to my mind, which county officer is 
 responsible for the holding and carrying out of these sales. If 
 I had the framing of the statutes, I should be inclined to enact 
 that the .sale .should be held by the sheriff". 
 
 The full record of arrears .should remain permanently and 
 continuously with the minor municipality, in the rolls brought 
 forward from year to year. Thus the arrears are kept alive 
 against each property not sold, for the continual use of collect¬ 
 ors, treasurers, clerks, and ratepayers in the several municipali¬ 
 ties where the assessments were originally made. Each sale 
 should also be recorded in the several rolls respectively. 
 
 In the case of cities, the treasurer is, or should be, in posse.ssion 
 
24 
 
 of the necessary information, and has simply to record the sales 
 he effects. 
 
 Time of Balancing —It is extremely desirable, in organizing 
 the simplest method of keeping accounts, to arrange for the bal¬ 
 ancing and annual statements to be rendered at the proper time. 
 
 The present system of balancing at 31st December, is extremely 
 awkward. A considerable amount of taxes assumed to be collected 
 by that date, are, as a matter of fact, collected afterwards. The 
 date of the balancing of the books, need not, and does not, influ¬ 
 ence results in this respect. Punctual payment has to be en¬ 
 couraged either by discount allowed, fine for omission, or summary 
 measures. 
 
 The proper time for balancing the books of a municipality is 
 when ? Do you not all grasp the idea before it is expressed ? 
 When should it be, but after the assessment is completed, the 
 revision is ended, the rate is struck, the clerk has had the taxes 
 extended and is ready to insert in the new rolls the arrears of 
 taxes from the rolls in use, and all is otherwise ready for the 
 collector to commence his work in connection with the new roll ? 
 Then it is that the treasurer should close his books and hand over 
 to the clerk the old rolls. While the clerk is entering the arrears 
 in the new rolls, the treasurer should be balancing his books. 
 
 The clerk, while entering the arrears in the new roll, having 
 thus both before him, can detect any omission or inconsistency in 
 the new rolls. 
 
 When the clerk has completed his entries of arrears in the new 
 rolls, the treasurer should check these entries as agreeing with 
 the old rolls, which may then be filed away as a record of the 
 past. 
 
 The clerk should, as at present provided by law (section 135, 
 page 2130), be the party to notify all ratepayers in arrears. The 
 wisdom of this arrangement is so apparent that comment is need¬ 
 less. It is really refreshing to be able to eulogize a provision in 
 Statutes such as the Municipal and Assessment Acts. 
 
 Assuming that amendments, such as I have recommended, are 
 effected as regards arrears and date of balancing, I now proceed to 
 describe the system of accounts which I have to suggest, begin¬ 
 ning with the assessment roll. 
 
25 
 
 It should be a fundamental principle, in devising any system 
 of accounts, to avoid all unnecessary repetition of labour. Where 
 this is accomplished, liability to error is necessarily reduced, and 
 time is saved whenever it becomes necessary to refer to original 
 records. 
 
 ASSESSMENT EOLLS. 
 
 The assessment rolls, being the source from whence the taxes 
 due by each ratepayer are computed, should unquestionably, if 
 practicable, without sacrificing other necessary considerations, be 
 the same books in which the payments under the assessment are 
 recorded. 
 
 In the case of a township or village this cannot be done without 
 very serious objections, more than sufficient to counterbalance the 
 advantages to be gained. The collectors, as a rule, have their 
 offices at their own dwellings, and the collectors’ rolls are in 
 private hands, at private residences or carried about. They 
 might be lost or destroyed by fire. If no other record of the 
 assessment existed, should the necessity arise for the reproduc¬ 
 tion of collectors’ rolls, a new assessment would also be required. 
 The remotest possibility of such chaotic results is sufficient to 
 banish all idea of using the assessment rolls as collectors’ rolls 
 in the minor municipalities. The labour, however, of re-writing 
 the names, addresses, amounts, Szc., in the case of a township, is 
 comparatively light. 
 
 With regard to cities it is very different. The collector’s office 
 is, or should be, in the municipal buildings. Indeed, it ought to 
 be adjoining the treasurer’s office. The rolls should never be 
 removed from the municipal offices. After all the ratepayers 
 have been duly served with notices of taxes payable, the rolls can 
 be kept in the treasurer’s office. They would, however, be per¬ 
 fectly safe in the collector’s office, should they be required for use 
 there. They could, in that case, be obtained from the treasurer 
 every morning and returned to him every night, if such a pre¬ 
 caution were deemed necessary. 
 
 If the statements rendered to the ratepayers, show all the 
 component parts of the taxes payable, precisely as they are 
 extended in the rolls, as should always be the case ; and if these 
 4 
 
26 
 
 statements be required to be brought to the collector’s office, 
 when payments are made; and if the collector’s cash book has. 
 the necessary columns identical with those in the rolls, the 
 posting should be done in the treasurer’s office. 
 
 After very careful consideration, I fail to discover any objection 
 to an assessment roll for a city being used as collector’s roll, 
 beyond such as, if valid, would necessitate every record of the 
 municipality being kept in duplicate. 
 
 The size of the book necessary might frighten one at first 
 thought, I find, however, on analyzing the provisions of the 
 statutes, section 14, sub-section 3, (page 2091) that many columns 
 of the assessment roll are applicable only to farm lands and to 
 those engaged in agricultural pursuits. By omitting these the 
 horizontal space occupied by the necessary columns is reduced 
 nearly one half ; so that no insurmountable difficulty exists as to 
 the size of the book required to serve for both purposes. 
 
 I would note here that section 119 (page 2125) requiring the 
 clerk to make out separate rolls, would have to be amended, as 
 well as section 1 i. 
 
 COLLECTOR’S ROLLS. 
 
 As I have endeavoured to show, the collectoj-’s rolls in cities 
 should be, the extension of the assessment rolls. It remains to 
 exhibit what columns should be added to provide for collecting. 
 When this is done, the same form is available for separate collec¬ 
 tor’s rolls, in addition to those columns of the assessment roll which 
 have to be copied. In either case, the last column to the right, 
 preceding those I shall name, should show the value of the property 
 assessed. The two columns immediately preceding the assessed 
 value, .should contain the name and address of the ratepayer. 
 
 I will proceed to the right hand, numbering the columns for 
 brevity and convenience. 
 
 1. T wo money columns ; one for additions to, and the other for 
 subtractions from, the assessed value. 
 
 2. Two columns; one broad and the other for money; to record 
 revised assessments, and the authority therefor. 
 
 3. Current rates in detail; as many money columns, as there 
 are various rates to be kept separate in the ledger. 
 
27 
 
 4. Total current taxes payable in each case. 
 
 5. Date of demand by the collector, or the serving of the notice,, 
 as may be required by law. 
 
 6. Repetition of the number on the roll. The clerk should fill 
 in the number in this column, when the rates are extended. 
 This is a check upon the extending of the taxes on the right line. 
 The collector is reminded by this, to mark the number on the bill 
 of taxes. It also facilitates the posting of payments in the rolls. 
 
 7. Current taxes paid; columns for date of payment, number 
 and folio of collector’s cash book, and amount. 
 
 8. Arrears of taxes ; as many sets of columns as there are years 
 of arrears necessary to be kept separate. Each set of columns 
 should have one for each rate kept separate in the ledger. 
 
 9. Arrears of taxes paid ; columns for date of payment, num¬ 
 ber and folio of collector’s cash book, and amount. 
 
 10. Date of report to county treasurer of lands liable to be 
 sold for taxes. This column can be utilized by the treasurer of a 
 city, for remarks pertinent to the same subject, such as date of 
 advertising sale, &c., &c. 
 
 11. Date of sale for taxes, with room for further particulars 
 and remarks. 
 
 12. Taxes written off by the authority of the council, columns 
 for money and reference to minutes. 
 
 In cases where taxes are payable by instalments, there should 
 be, between the lines showing the amount due by each ratepayer 
 as many faint blue horizontal lines as there are instalments which 
 may be paid separately. 
 
 To use a hackneyed phrase, “ imagine the thing done, and see 
 what it looks like.” 
 
 For cities, the routine would then be as follows: The assessors 
 take the blank rolls, and fill in the particulars and valuations 
 required by law; adding up the columns requiring addition and 
 initialing the totals, they sign their reports, making the necessary 
 affidavits, and hand the rolls to the clerk, completed as far as 
 their work is concerned. Thenceforth the rolls are lodged in the 
 public offices of the municipality, never to be removed, unless 
 and until, from lapse of time, they become utterly useless, and are 
 destroyed as rubbish by authority of the council. After the 
 
28 
 
 Court of Revision has com|)leted its work, and every revised 
 assessment has been recorded on the rolls in the presence of the 
 Court, the clerk extends the various rates and the total payable 
 by each party assessed; adding up all the columns and certifying 
 to the correctness of the work, he awaits the arrival of the day 
 fixed for closing the books. When that day arrives, the treasurer 
 hands the old rolls to the clerk, posted to date. As I said before, 
 while the clerk is entering the arrears the treasurer is balancing 
 his books, which of course have been kept balanced every month. 
 When the clerk announces that the arrears are brought forward 
 in the new roll, and added up respectively, the treasurer checks 
 the totals, by seeing that taxes paid and written off, if any, added 
 to arrears, balance exactly with taxes levied in every division of 
 each year’s taxes. The treasurer then certifies to the correctness 
 of the clerk’s certificate as regards arrears. The clerk then 
 notifies all parties in arrear, and hands the rolls to the collector. 
 The collector makes out the accounts, numbering each one, as 
 numbered on the rolls. The printed form used for this purpose 
 should specify each separate rate, and in the same order in which 
 they appear on the rolls. There should be a notice thereon, 
 requiring each ratepayer to present it when tendering payment, 
 and stating that if lost or mislaid, a duplicate must be applied 
 for of, and will be supplied by, the treasurer. This will effectually 
 prevent the collector being worried, by having to give informa¬ 
 tion, while his hands are full receiving money; while at the same 
 time it will remove all difficulty in the way of keeping the rolls 
 in the treasurer’s office. This notice should be printed in ink of 
 a different colour from that used in printing the body of the tax 
 account, and should be made conspicuous. There should also be 
 a notice, printed in heavy type, demanding payment on or before 
 a certain day, and reciting the loss or penalty incurred by non¬ 
 payment then or previously. This notice should specify exactly 
 where such payment is to be made, giving the number or other 
 full description of the collector’s office, in the municipal buildings. 
 The collector serves these notices, recording the date of service in 
 each case; and so soon as all notices are served, he certifies to 
 the fact on the rolls and hands them to the treasurer. 
 
 Just here, a thought occurs to me. Would it not be a mercy to 
 
29 
 
 the employees in the collector’s office,as well as a great convenience 
 to the ratepayers, if the by-law of a city fixing the date, on or 
 before which taxes must be paid, were to name a separate day for 
 each ward ? 
 
 COLLECTOR’S CASH BOOK. 
 
 The collector’s cash books must next be considered. For a 
 township, village, or small town, where the payments are not too 
 numerous to admit of one person at a time receiving cash, of 
 course one cash book is all that is necessary each da 3 \ This, how¬ 
 ever, should be in two volumes ; each used alternately during the 
 day, week, or month, respectively, intervening between the 
 periodical deposits with the treasurer. 
 
 In the case of cities, however, at certain periods of the year, 
 it requires several persons to wait on the ratepayers simultan¬ 
 eously. For want of a proper system, I have known loose sheets 
 of paper to be used by the collector’s assistants. Yet, it almost 
 seems insulting to the good sense of the public, to say noth¬ 
 ing of the judgment of an expert, to utter anything so self- 
 evident as to say that this should never be done under any 
 circumstances. There should be a sufficient number of subsi¬ 
 diary cash books to serve the purpose. These should be in two 
 sets; each set in consecutive alternate numbers; one odd and 
 the other even. The odd-numbered set should be used one 
 day, and that with even numbers the next; and so on contin¬ 
 uously. These books should be ruled precisely the same as the 
 collector’s general cash book. 
 
 For the guidance of inexperienced young men, who may be 
 entrusted with the receiving of money, I would note, that, the 
 amount received, should, in every instance, be entered in the cash 
 book, before the receipt is signed, or the money placed in the 
 till. Only one assistant should use the same cash book on the 
 .same day ; and he should keep the cash received by him separate 
 from all other cash received. At the close of the day, each assist¬ 
 ant should balance his cash, and sign his name opposite the amount 
 in the book which he has used. The collector should also sign 
 his name in the same book, acknowledging receipt of the amount 
 from his assistant. The collector should enter in his general cash 
 
30 
 
 book, the totals of each subsidiary book, and balance his cash, then 
 and there, and hand over to the treasurer the amount along with 
 all the subsidiary cash books containing the details. When such a 
 collector personally receives payments of taxes, he must also use 
 one of the subsidiary books for recording the details. If from any 
 cause, such as extreme press of business or deficiency in his staff, 
 the collector has not secured the proper filling in of the compo¬ 
 nent parts of the taxes in all the subsidiary books, the details 
 neglected can be filled up in these books on the following day in 
 the treasurer’s office. 
 
 With regard to the cash received from the ratepayers, by the 
 collectors, it seems needless to state, as I have done, that in cities 
 it should be paid over daily to the treasurer; the propriety, 
 utility, and convenience being .so apparent. Yet I have known 
 a collector to bank the money himself, and hand cheques to the 
 treasurer from time to time for round sums. In minor munici¬ 
 palities, where the officers often live miles apart from one another, 
 and where there are no municipal offices, properly so called, the 
 collector cannot report and account to the treasurer daily. He 
 can, however, monthly, or even weekly, and every time it should 
 be the handing over of the exact amount collected to that date, 
 with the full particulars. In fact, as explained, the handing over 
 of the cash book last used, along with the cash collected. 
 
 The collector’s cash books and the subsidiary cash books should 
 all be ruled as follows, commencing at the left hand and proceed¬ 
 ing to the right: 
 
 1. Date of receipt. 
 
 2. Name of ratepayer. # 
 
 3. Address of i-atepayer. 
 
 4. Number on the roll. 
 
 5. Amount of taxes received (total). 
 
 6. A set of columns corresponding with the roll, shewing com¬ 
 ponent parts of current taxes, the totals of which have to be 
 posted separately in the ledger. 
 
 7. The same set of columns, for as many years of arrears as are 
 necessary to be kept separate. The last of these to contain the 
 oldest arrears, including all not separately provided for. 
 
 8. Date and amount of money paid over by assistant to col¬ 
 lector, or collector to treasurer, as the case may be. 
 
31 
 
 9. Two spaces for signatures ; one certifying to correctness, the 
 other acknowledging receipt of amount. 
 
 Columns 2, 3, and 4, in the general cash book, can be utilized 
 for inserting the name of the assistant, and the designation of 
 the subsidiary book used by him. Thus one printed form will 
 answer for both purposes. 
 
 It now remains to point out the surprising provisions of the 
 statute regarding collectors. Chapter 193, section 132 (page 2129) 
 reads thus: 
 
 “ In towns, villages, and townships, every collector shall return 
 his roll to the treasurer on or before the 14th day of December, in 
 each 3 ’ear, or on such day in the next year, not later than the 1st 
 day^ of February, as the council of the municipality" may appoint, 
 and shall pay over the amount payable to such treasurer, specify¬ 
 ing in a separate column on his roll how much of the whole 
 amount paid over is on account of each separate rate; and shall 
 make oath before the treasurer that the date of the demand of 
 pay^ment and transmission of statement, and demand of taxes 
 required by sections 123 and 125 in each case, has been truly 
 stated by him in the roll.” 
 
 Section 134 reads: “ The council of every city may'^, by by-law, 
 fix the times for the return of the collector’s rolls, and any enlarge¬ 
 ments of the same.” 
 
 The return of the rolls, and the payment of the cash are in both 
 cases assumed to be at the same time, and such time that of the 
 final report by the collector! 
 
 The reader stands aghast! Is the treasurer to lend the muni- 
 pality all the funds wanted for disbursements, until the collector 
 has finished his work ? Is the collector to be allowed to make all 
 the interest he can upon his collections, until the time comes when 
 he must make his final report, and hand over the money collected ? 
 Or what is to be understood by these provisions ? 
 
 TREASURER’S CASH BOOK. 
 
 The Treasurer should have a column cash book in two volumes 
 —one for receipts and bank deposits the other for bank cheque.s 
 and payments. In every instance where deposits are made in 
 more than one bank, or special deposits in the same bank, a sepa- 
 
32 
 
 rate column with suitable headings must be used in each volume. 
 The advantages of this system are so obvious that to suggest it^ is 
 all that is necessary. The volume for receipts shows the entire 
 revenue and where it has been banked. The volume for payments 
 shows the entire expenditure, and from what bank account the 
 money has been withdrawn. The room for columns in the same 
 sized book is doubled as compared with attempting to show both 
 receipts and pavments in the same volume. The convenience in 
 use and during audit is strikingly apparent. 
 
 The volume for receipts should, in addition to the date column 
 and that for describing the entry, which for convenience we 
 will call 1 and 2, be provided with the following: proceeding 
 to the right. 
 
 3. Ledger folio for items posted separately. 
 
 4. Such items. 
 
 5. A few blank columns for new sources of revenues arising 
 with frequent transactions, or for unexpected increase of trans¬ 
 actions, in accounts not pre-supposed to require separate columns. 
 
 6. A separate column for each source of revenue kept separate 
 in the ledger, the transactions concerning which are frequent dur¬ 
 ing the month. These columns must embrace, as the last to the 
 right hand, an exact repetition of the tax columns in the collector’s 
 cash books. 
 
 7. Total amounts received daily from collector. This column 
 shews simply the addition of the tax columns, but is necessary 
 in case that, from press of business, the collector cannot at the 
 moment of payment, exhibit the component parts of his receipts. 
 It serves as an exhibit of collector’s account. It should be dis- 
 tinguised from all other columns, say by perpendicular lines of 
 ink of a different colour from the rest. There should be in this 
 column a sub-column, for the number and folio of collector’s 
 cash book. 
 
 8. As many columns as are necessary for bank deposits, with 
 a date column to each; or, if necessary, to economise space, one 
 date column for the whole. These should be to the extreme rio-ht, 
 except a margin if the paper will admit of it. 
 
 The volume for payments should have columns arranged in 
 the following order ; proceeding from left to right: 
 
33 
 
 1. Number of voucher. 
 
 2. Cheque numbers. 
 
 3. Cash columns for the cheques on each bank account separately. 
 
 4. Cheques cashed by the treasurer for petty or other payments- 
 
 5. Such payments made by treasurer from proceeds of such 
 cheques. These two columns should be enclosed by perpendicular 
 lines of a different colour from the rest. All the payments, of 
 course, should be extended in the proper columns for posting, and 
 all the cheques in the proper bank columns. The total expenditure 
 deducted from the bank cheques exhibits the cash which the 
 treasurer should have on hand, while the repeated items in the 
 treasurer’s column deducted from the repeated cheques shows the 
 same balance. 
 
 6. Date. 
 
 7. Description of the entry. 
 
 8. Ledger folio for items posted separately. 
 
 9. Such items. 
 
 10. As many columns as there are ledger accounts, the items 
 of which occur constantly during the month. 
 
 11. A few blank money columns for new accounts not foreseen, 
 concerning which transactions may be frequent. 
 
 VOUCHERS. 
 
 The most convenient way of numbering vouchers is, to adopt, 
 in every instance, the number of the cheque. If there be a 
 number of payments made from the proceeds of one cheque, such 
 as disbursements by the treasurer in money out of the proceeds 
 of a cheque in his favour, the vouchers should be sub-numbered, 
 with the prefix of the number of the cheque Should a number 
 of cheques be issued, the receipts for which are covered by one 
 voucher, such as that of the officers’ pay roll or otherwise, the 
 voucher should carry the several cheque numbers. If there be 
 more than one bank account, there is nothing to prevent as many 
 series of voucher numbers as there are bank accounts. 
 
 There should be an index to vouchers—a complex index for 
 ready reference. A large number of vouchers can be indexed 
 under classified groupings. Many will be for regular periodical 
 payments, against the classification of which in the index it will 
 5 
 
84 
 
 be sufficient to record, “monthly,” “weekly,” &c., without further 
 posting. All vouchers for payments on account of contracts, or 
 for goods purchased, and the like, should be indexed under the 
 name of the individual, firm, or company to whom the payment 
 is due. 
 
 The treasurer should not pay any money, or deliver any 
 cheque, without receiving a voucher reciting full particulars 
 concerning the payment, even though there be only one item, or 
 that the cheque be made payable to order. 
 
 On making any payment, the last voucher from the same party 
 or parties should always be referred to, to make sure that the 
 same item is not charged more than once. 
 
 Every voucher should have recorded on it the number of the 
 last one received from the same jDarty, 
 
 PAY ROLLS. 
 
 There should be as man}^ pa 3 '--rolIs (or more properly speaking 
 pay-registers) as there are pay-masters. If, lor instance, the 
 wages certified to by the citj’' engineer, or any other head of a 
 department, are paid out by several clerks, each party pajdng the 
 wages and taking the receipts should be supplied with a separate 
 pay-roll and the proceeds of a separate cheque. The separate 
 pay-rolls must, of cour.se, be made out in such a way as to enable 
 each workman to know who to apply to for his wages. 
 
 The pay-rolls should, in every instance, be books ; never on any 
 account should loose or unbound sheets be used. 
 
 There should be, to the extreme left hand, a column for the 
 folio of the time book or other record from which the wages are 
 made up. If there be no time register, other than the time books 
 of the foremen, column 
 
 1, should be wiae, and the name of each foreman respectively 
 should be recorded. 
 
 2. Designation of the work on which the labour has been 
 bestowed. 
 
 8. Designation of the accounts to which it is to be charged. 
 
 4. Name of labourer. 
 
 o. A column lor each day intervening between pay days for 
 lecoi ding dail}’^ time that is, if there be no separate general time 
 
35 
 
 Tegister, also a column for the total number of days’ work, or this 
 latter column only if there be a time register. 
 
 6. Rate of wages per day. 
 
 7, Amount of wages due ; 8. Totals, per ledger accounts. 
 
 9. Signatures acknowledging receipt 
 
 10. Remarks. Note here that remarks should never be written 
 in the column for signatures. There should remain a blank 
 against every amount, the receipt of which is not acknowledged. 
 If paid and not acknowledged, the fact can be recorded in the 
 column for remarks, and the signature obtained at first opportunity. 
 
 11. As many money columns as there are ledger accounts 
 affected by the payments. 
 
 The wages, after being made up and duly checked and certified 
 to by the engineer and other heads of departments, respectively, 
 should be extended in the classified money columns and added 
 up. As I said, a separate cheque should be made out for each 
 roll. This should be made payable to the order of the officer 
 responsible, no matter who he may justly and properly entrust 
 with the paying of the wages. Such responsible officer should 
 sign a receipt for each cheque to his order, reciting therein: 
 
 For week ending pay-roll folio 
 
 This cheque should be entered in the cash book, and also the 
 totals of the classified columns of the pa 3 ^-roll, as the details of 
 the expenditure covered by such cheque, before the cheque passes 
 out of the hands of the treasurer. 
 
 Should it happen that any wages are unclaimed by the time 
 that the next cheque is issued under the same pay-roll, the 
 unclaimed amounts should be deducted from the new totals of all 
 the columns affected, and a new cheque issued for the balance of 
 cash required, and so on continuously. 
 
 If it be thought preferable, or more strictly correct, to record 
 unclaimed wages as a liability, the amount not applied for may 
 be returned to the treasurer in cash and credited to “ unclaimed 
 wages.” 
 
 DEBENTURE REGISTER. 
 
 A properly prepared and carefully kept debenture register is of 
 ^reat importance. Not only does it serve purposes of ready refer¬ 
 ence as to debenture debt, but also as regards maturity. Nor is 
 
36 
 
 this all. It should exhibit such information as will effectually 
 prevent the necessity for keeping separate ledger accounts for 
 each issue of debentures and each relative sinking fund. 
 
 The debenture register should have the following columns, com¬ 
 mencing from the left hand : 
 
 1. Number of by-law. 
 
 2. Date. 
 
 3. Number of years to run. 
 
 4. The work for which they are issued. 
 
 5. Debenture numbers, singly, one on each line, no matter how 
 small each debenture or how numerous the whole issue. 
 
 6. The sterling amount of each debenture payable in sterling, 
 ruled for pounds, shillings, and pence. 
 
 7. The currency amount of each debenture payable in currency, 
 ruled for dollars and cents. 
 
 8. Total in sterling of sterling debentures. 
 
 9. Total in currency of currency debentures. 
 
 10. Eate of interest payable. 
 
 11. Yearly sinking fund to be provided. This should be ruled 
 for rate of interest at which the sum is computed, and for the 
 annual amount. 
 
 12. Where payable. 
 
 13. When due—day, month, and year. 
 
 ] 4. When interest is payable—day and two months. 
 
 15. Twelve columns, one for each month in the year; each 
 divided into three : 1. Year of maturity. 2. Sterling amount of 
 interest payable in sterling. 3. Currency amount of interest pay¬ 
 able in currency. 
 
 16. When paid and cash book folio. 
 
 Unless in my haste I have overlooked anything, the foregoing 
 is a complete debenture register. 
 
 If the number of debenture issues of a municipality are small 
 and not likely to increase much, the space can be curtailed and a 
 smaller book used, by substituting for columns numbered 15 twelve 
 narrow single columns, one for each month of the year, in which 
 to insert the years of maturity, and say “ Int.” in the months in 
 which the principal and interest mature respectively. 
 
 If all interest be made payable on the same two days in each 
 
37 
 
 year, and all principal on the same day in the respective years, 
 columns numbered 15 will not be required at all; 13 will only 
 require one column for year of maturity, and for 14 two columns 
 .substituted for amount of sterling and currency interest respect¬ 
 ively. 
 
 Whenever any debentures are paid, other than as investment 
 of sinking fund, the total amount paid should be deducted from the 
 running grand total of debentures issued. The amount of yearly 
 sinking fund in respect of such debentures paid, must also be 
 deducted from the grand total of yearly sinking fund. The 
 interest thus ceasing must also be deducted from the grand totals 
 of interest payable. The totals of the debenture register will, 
 thus, always shew the debenture debt and the annual sinking fund 
 required. 
 
 It must always be remembered that debentures redeemed 
 before maturity by investment of sinking funds, must never be 
 thus written off until they mature, as pointed out under the 
 heading of sinking fund. 
 
 Local debentures may either be recorded in a separate part of 
 the same register, or in a separate volume. 
 
 JOURNAL. 
 
 With regard to the journal, I can only say what every expert 
 will at once endorse, that the entries should be no more than are 
 unavoidable. As a rule, the introduction of the rates levied into 
 the ledger, the correction of errors, and the closing of the accounts, 
 embrace all the entries that should find a lodgment in this most 
 essential but most abused medium of effecting ledger entries. 
 
 LEDGER. 
 
 The ledger of a municipality is, of course, no exception to the 
 general rule. There should be no more accounts opened, than are 
 necessary for purposes of management, the exhibiting of re.sults, 
 and convenient adjusting of the various transactions. A balance 
 sheet taken from the ledger, should at all times show, in a concise 
 form, the salient points regarding the working and financial 
 position of the municipality. 
 
 As it is necessary that a ledger should .show all assets and 
 
38 
 
 liabilities, as well as receipts and expenditure ; I have no hesita¬ 
 tion in asserting, that, so soon as the collector’s rolls are completed 
 by the clerk, and before they are handed over to the collector, 
 the treasurer should make a journal entry, charging the various 
 tax accounts with the rates assessed and crediting, say, “ assess¬ 
 ment account ” with the total. 
 
 Whenever a minute is passed by the council authorizing the 
 writing off of taxes known to be irrecoverably lost, the treasurer 
 should make a journal entry charging '' assessment account,” and 
 crediting the various tax accounts in detail. 
 
 Cash receipts should, of course, be credited to the various tax 
 accounts as received. Cash payments to school trustees, county 
 treasurers, and so forth, should be charged direct to them as if 
 personal accounts. In the same way, the expenditure of moneys 
 received on local assessments, must be charged to the work or 
 expense for which the tax is raised. At the end of the year, school 
 trustees, county treasurer, and local expenses, &;c., are all credited 
 with the respective amounts actually realized ; sinking fund is. 
 credited with the necessary amount, and revenue with the balance 
 available. The whole is charged to assessment account. The 
 balance remaining at the credit of “ assessments,” will then exactly 
 balance with the several amounts of uncollected taxes at the debit 
 of the various tax accounts. These will also exactly agree with 
 the arrears brought forward in the new rolls. 
 
 With regard to debentures I am in favour of one account in the 
 ledger for general debentures, and one for local, with two corres¬ 
 ponding sinking funds. The register should supply all the details- 
 that are necessary. 
 
 The amounts credited to sinking fund, and all interest earned 
 thereon, must remain at the credit of the fund; and no 
 debit whatever be made until debentures fall due and are 
 paid. As each issue of debentures is paid, of course the cash 
 payment of the whole issue, is charged to the debenture account. 
 Immediately the payment is effected, an entry must be made 
 charging sinking fund and crediting capital account with the 
 portion of the sinking fund which has been accumulated in res¬ 
 pect of such debentures, which should be the amount of the 
 debentures. 
 
39 
 
 The investments of the money at credit of sinking fund, must 
 of course, be charged to the debtors under such investments. The 
 interest may, and most properly should, in the first instance as 
 received, be credited to the debtor’s accounts to exhibit how they 
 stand ; but on closing the books each year be carried to credit 
 of the sinking fund. When the principal of these investments is 
 collected, it will of course be credited to the debtors respectively. 
 When the sinking fund moneys are all invested in redemption of 
 the debentures, the investments will be comprised in one account, 
 say “ sinking fund debentures,” which will have to be treated 
 precisely the same as though the municipality was the debtor. 
 
 There should be a separate ledger account for every permanent 
 work. These should all be in the same part of the ledger. They 
 should appear on the balance sheet, monthly as well as yearly, in the 
 margin ; extended in one sum. Assets of any kind, provided 
 for and paid out of the current revenue, should be charged to, and 
 remain at the debit of suitabl}' designated accounts, intelligibly 
 setting forth the nature of such assets. The amounts so paid, 
 must be charged to revenue and credited to capital, at the end of 
 the year. It is well, in the headings of the ledger account for 
 
 works, to state “ under by-law No.- debentures issued for 
 
 $- on such a date.” When debentures issued at the same date 
 
 under the same by-law, cover more than one work; it should be 
 added, “of which $ - for this work.” 
 
 Capital account should be charged, and the various works 
 credited, at the close of each year, with the amount of depreciation 
 in value, so as to reduce the amount at the debit of each work to 
 the then actual value. 
 
 Repairs should be charged to each work respectively, ad-interim, 
 but written off if the increased value does not wai rant the addition, 
 or so much thereof as is necessary to reduce the total amount at 
 debit to the actual value. 
 
 Ward accounts should also be together in the same part of the 
 ledger. They may be extended separately or together on the 
 balance sheet. Each ward should be charged with the expendi¬ 
 ture specially arranged to be incurred out of the general taxes. 
 A.t the end of the year, each ward should be credited with its 
 proper proportion of the surplus taxes including such expendi- 
 
1 
 
 40 
 
 tore, closing revenue account ; leaving the actual expenditure so 
 incurred, at the debit of the ward benefited, and its share only 
 of the surplus taxes at its credit. 
 
 In closing the books at the end of each year, interest should 
 be charged, and accrued interest credited, with the amount of 
 interest accrued on debentures but not due or not paid to date. 
 
 Immediately after the closing of the books, this entry should 
 be reversed. 
 
 With regard to expenses : it is worse than useless to have an 
 unlimited number of accounts opened, as is the practice almost 
 universally. The council should carefully and deliberately 
 consider in consultation with the officer who keeps the 
 accounts, what expenses should be recorded separately for 
 economic purposes. A system should be arranged by which 
 the balance sheet will exhibit at a glance the totals sought 
 to be known. A column ledger greatly facilitates the exhibiting 
 of such detailed information as the council or ratepaj^ers may 
 desire. The fewer the accounts the better, and the less sub-divi¬ 
 sion there is, the greater is the attention paid to the items. The 
 ledger accounts should be only such as are absolutely necessary 
 to shew a distinction between the expenses arising from varying 
 circumstances. For instance, salaries, miscellaneous expenses, 
 incidental expenses, donations and relief, all these are governed 
 by a separate set of circumstances respectively, and the totals 
 should be shown on the balance sheet. For convenient analysis, 
 however, salaries may be divided in the marginal columns of the 
 ledger into departments: such as cit}’^ offices, city engineer’s 
 department, assessment and licence commissioners, or any sub¬ 
 division to suit the fancy. Expenses might be sub-divided into 
 “ Rent, fuel, and light,” “ Printing, advertising, and stationery,” 
 and so forth, the fewer the better. So with incidental expenses 
 and donations. 
 
 STATEMENTS. 
 
 If the ledger be properly kept, the statements will partake of 
 the same systematic character. 
 
 In exhibiting receipts and expenditure, the details, as far as are 
 necessary to digest the transactions in a lucid manner, should be 
 
noted in the margin, and the totals so extended as to show a brief 
 condensed epitome of the whole. For instance, expenditure should 
 be extended in totals, with a view to exhibiting at a glance the 
 salient points, such as “ Annual expenses,” “ Incidental expenses,’ 
 “Repairs,” “Improvements,” “Public works,” “Buildings,” “Land,” 
 “ Sinking Fund Investments,” and so forth. 
 
 Liabilities and assets should be dealt with in a similar way. 
 
 MINUTES. 
 
 Chapter 184, section 245 (page 1832), provides that the clerk 
 must record minutes “without note or comment.” This is no 
 doubt to be understood as enforcing faithful record of proceedings 
 of council. Technically speaking, however, it precludes a very 
 important necessity, viz., that of classifying and thereafter 
 indexing minutes, so as to be easily referred to. It should be 
 added, “other than headings or marginal references as to the 
 subject of the resolution and other minutes relating theretoand 
 it might very properly be added, that “all minutes shall be 
 indexed under the designation of such headings or references.” 
 
 The comptroller, or auditor, as the case may be, should have 
 power to alter such headings or references, so as to express more 
 clearly, if necessary, the nature and bearing of every minute, and 
 to see that the corresponding alteration, if any, in each case, is 
 duly made in the index. 
 
 GOVERNMENT SUPERVISION. 
 
 There is an old adage that “ prevention is better than cure.” I 
 am of opinion that there should be Government supervision of 
 municipal accounts carried on through a superintendent of ability 
 and experience as an expert accountant. 
 
 Such an officer would be in a position to advise and assist the 
 Government in framing proposed legislation concerning municipal 
 matters as occasion required. He should be empowered, and it 
 should be his duty, to prescribe the methods and forms to be ad¬ 
 hered to in the keeping of municipal accounts and rendering of 
 annual statements. All returns required to be made to the Gov¬ 
 ernment, and copies of all annual statements should be forwarded 
 to him. Returns by the respective treasurers should, in my opinion, 
 
42 
 
 be made on oath. The superintendent should have power to ex¬ 
 amine any municipal officer on oath touching any financial matter 
 affecting any municipality. 
 
 In case of any alleged or suspected contravention of the statutes, 
 misappropi-iation of funds, misconduct, or any other irregularity, 
 not involving, priina facie, a felony; or if there be evident mis¬ 
 management, it should be the duty of the superintendent to 
 promptly make a preliminary investigation. He should first- 
 ascertain whether any grounds exist for such suspicion or com¬ 
 plaint. If so, he should proceed to consider the nature and extent 
 of the evil, and the probable ramifications of the errors occasioned; 
 and take such steps as he may think fit, for procuring a full dis¬ 
 closure and exhibit, not only of the primary defaults, errors or 
 omissions discovered, if any, but also the nature and amount of' 
 all erroneous receipts or payments, charges, or credits which have 
 resulted. He should then consider what party or parties are 
 responsible or implicated, not only as regards the effecting of 
 each transaction or entry involved, but also as regards quasi 
 consent thereto, by any officer passing it over whose duty 
 it was to have prevented or reported it; and also as regards 
 incompetency on the part of any officer, ignorant of the facts, 
 whose duty it was to have discovered them. Upon ascer¬ 
 taining all necessary details, it should be the duty of the 
 superintendent to see that the errors are rectified, and to 
 require that any officer found unfit for his position be removed 
 therefrom If it appears that an}^ party has been guilty of a 
 wilful breach of the law, the superintendent should see that the 
 necessary steps are taken to have the case tried by a competent 
 tribunal. If a 2 ^rima facie case of felony arises, the same course 
 should be pursued, except as regards the party or parties accused, 
 whose arrest would not, of course, await even the preliminary 
 investigation. 
 
 For convenient reference, I note here that chapter 184, section 
 477, would have to be repealed, and provision made for reference 
 to a judge only as regards the persons of offenders. I would also 
 note that sections 248 and 252, and chapter 186, sections 5 and 
 6, regarding returns, would need amending. 
 
43 
 
 COMPTROLLERS FOR CITIES. 
 
 Cities, in my opinion, should each have a comptroller. Tho 
 duties of such an oiB&cer are too well known to need any explana¬ 
 tion. Before any payment is made his signature or initials should 
 be compulsory. Thus every item becomes audited at the right 
 moment. Every comptroller should be an expert accountant of 
 known integrity. The superintendent, however, should have the 
 right of investigating the affairs of any municipality, at any time, 
 without notice. The appointment of comptroller should rest 
 with the Government, it being provided by Act of Parliament 
 that only an expert accountant of ability, experience, and integ¬ 
 rity, and between certain ages is eligible. If any difficulty arises 
 between the comptroller and the Mayor or Board of Aldermen, 
 the superintendant should have the power, and be required, to 
 give definite instructions to the comptroller, upon application by 
 him or the corporation, and such decision should be final. 
 
 AUDITORS. 
 
 For municipalities, other than cities, my opinion is, that the 
 Government should appoint auditors, under suitable restrictions, 
 provided by Act of Parliament, as to qualifications. 
 
 PATRONAGE. 
 
 If it be urged that the patronage of the Government is liable 
 to be exercised with political bias, I would reply that this is imma¬ 
 terial, provided that suitable qualifications are required by law. If 
 this answer is unsatisfactory, I would point to the fact, that if the 
 Government does not make the appointment, it devolves upon the 
 very men who control the treasurer to do so. Of the two evils 
 which is the least ? 
 
 I note here, that, chapter 184, sections 258 to 268 inclusive 
 (page 1837) would have to be re-written in amending the Act. 
 
 DUTIES OF AUDITORS 
 
 AS AT PRESENT PROVIDED BY LAW. 
 
 If no change is effected in the mode of appointing auditors, it 
 remains to point out impractical provisions and contraposed 
 enactments in the statutes as they now stand. 
 
44 
 
 Chapter 184, section 258, (p. 1837) provides for the appointing 
 of auditors at the first meeting of every council in January, 
 subject to the provisions of sections 259 and 260. 
 
 Section 259, sub-section 1, requires that the auditors for the 
 City of Toronto, be appointed in December. 
 
 Section 260, sub-section 1, allows the same course to be adop¬ 
 ted by other cities. 
 
 Section 263, sub-section 1, provides that the auditors shall 
 report on all matters for the year ending 31st December preced¬ 
 ing their appointment. 
 
 Section 263, sub-section 2, provides that the auditors shall 
 make their report within one month after their appointment. 
 
 Section 259, sub-section 2, requires that the auditors for the 
 City of Toronto, shall discharge the duties imposed upon audi¬ 
 tors by section 263, sub-section 2, within one month after the 31st 
 of December in each year. 
 
 Construing section 263, sub-section 1, technically (no exception 
 being mentioned), the auditors appointed by the City of Toronto 
 in December would have to audit the accounts for the year 
 ending 31st of the previous December. Setting this aside and 
 taking the whole of section 263, and sub-section 2 of section 259 
 together, and bearing in mind the immediate connection between 
 sub-sections 1 and 2 of section 263, the liberal construction would 
 appear to be, that the accounts of the year just ending, or ended, 
 were to be audited, and that auditors appointed in December were 
 to complete their labours by 31st January, and those appointed 
 in January within one month of the date of appointment. In 
 the case of cities and large towns (not to speak of other munici¬ 
 palities where the same objection arises in a le.ss degree) such a 
 provision is too absurd to the mind of an experienced accountant 
 to need any comment. 
 
 But, strange as it appears, in the face of the provisions 
 cited, section 261 I’equires the auditors to examine and report 
 upon the accounts “ every month, commencing at the end of the 
 first month in the year following the said month of December, 
 and so on to the end of such year.” 
 
 It is simply impossible to reconcile these provisions. It is clear, 
 however, that the enactment of section 261 is sound, and the 
 
45 
 
 other provisions should be so amended as to reconcile them 'with 
 this clause. 
 
 In order that I may not be accused of keeping out of sight any 
 provision that might be construed as bearing on the provisions I 
 have quoted, I insert here sec. 260, sub-sec. 2, in full, which reads 
 thus: “Notwithstanding this section or any such by-law the pro¬ 
 visions of sec. 258 of this Act as to the appointment of auditors 
 shall apply to the audit of the accounts of the year in which such 
 by-law takes effect.” 
 
 Section 258 is the substantive clause regarding appointing of 
 auditors, and neither this clause nor section 260 mentions aii}^- 
 thing concerning the duties of the auditors. We are, therefore, 
 thrown entirely upon the provisions of the by-law and the inter¬ 
 pretation of the words, “ takes effect,” in order to apply this 
 provision. 
 
 Enough has been said, however, to show that such amendments 
 are necessary under existing circumstances as would effectually 
 cause the annulling of this sub-section. Should any change be 
 made as to the mode of appointing auditors such as I have 
 advocated, all the provisions would have to be re-written. 
 
 CONCLUDING REMAKES. 
 
 Mr. Chairman and gentlemen, I have stated all that I am pre¬ 
 pared to advance on the present occasion. I have endeavoured 
 to take a comprehensive view of the subject. I have not spared 
 time or pains, in endeavouring to bring befoi-e you interesting 
 points connected with my theme, whether or not I have hit upon 
 the desideratum in each particular. If my views can be improved 
 upon, I shall be the first to rejoice at any advance made towards 
 the solution of the questions dealt with. If I have omitted much 
 that would be interesting, or that I ought to have commented 
 upon ; or if I have but barely touched upon matters that I ought 
 to have digested, I think I may justly claim a free pardon, as the 
 theme embraces, necessarily, such an extensive combination of 
 relative subjects. If I have tripped and fallen into any absurdi¬ 
 ties, such as that of cutting two holes in the door to let the kitten 
 in as well as the cat, I trust that I shall also be pardoned; as the 
 crowding together of such multitudinous thoughts into a short 
 
46 
 
 essay in a limited space of time, is apt to have the effect of 
 eausing the mind to overlook the most commonplace, self-evident 
 truths amidst the grandeur of the thoughts which prompt the 
 schemes. 
 
 With regard to my suggestions as to how municipal accounts 
 should be kept, I would observe that all who have had extensive 
 experience in dictating to others how accounts ought to be kept, 
 will agree with me, that as a rule, the men whose time is fully 
 occupied in recording the transactions of any municjpalit}^ com¬ 
 pany, or firm, are the least likely to discern what the best method 
 is. The old saying, that the looker on sees the best of the game, 
 is peculiarly applicable in this connection. It is true, that a 
 thorough knowledge of the business to be recorded is necessary. 
 Something more than this, however, is required. It needs that 
 probing thought which only calm and deliberate reflection can 
 accomplish, to perceive how work can be lessened and records 
 systematized, and leisure to work out a complete system. Even 
 Moses required the wise suggestions of his father-in-law to pre¬ 
 vent him from working himself to death. With such an instance as 
 this before us, let not any municipal officer judge it to be arrogant 
 for an expert of diversified experience to point out how the labours 
 of municipal officers may be made a pleasure rather than a 
 drudgery. 
 
 In conclusion, I would say that while I am aware that a com¬ 
 mission has been sitting in some way connected with municipal 
 affairs, I have not read the report of this commis.sion; and I am 
 glad that it is so. If any of the views I have expressed agree 
 with the findings or ideas of the commissioners, I know it not; 
 and if anything that I have said conflict with their views, I am 
 equally ignorant. Such as they are, the views I have expressed 
 are entirely original. My attention was drawn to a paragraph in 
 the report of the commissioners, and I have purposely, studiously 
 avoided any allusion to the subject matter of that paragraph. 
 
 In commencing my paper, I was very careful to note the 
 various provisions of the statutes bearing upon the matters dis¬ 
 cussed which, in my ojiinion, required amending. 
 
 I can safely say, in concluding, that, after a full perusal of the 
 statutes ]-elatmg to municipal affairs, I find that the enactments 
 
47 
 
 require, not only amendment, but entire revision, re-classification, 
 and condensation. 
 
 I trust that we all have the same object in view—the public 
 good. May the best measures prevail, regardless of the source 
 from whence they emanate. 
 
 WILLIAM POWIS, F. C. A. 
 
 Toronto, 13th December, 1888. 
 
 MDIS’ICIPAL ADMINISTRATION. 
 
 Since writing my paper on “ Municipal Finances and Accounts, 
 and Relative Legislation,” I have had the pleasure of reading the 
 “First Report of the Commission on Municipal Institutions 
 appointed by the Government of the Province of Ontario.” 
 
 The historical sketch of Municipal Institutions at home and 
 abroad, is extremely interesting; I experienced, however, a feel¬ 
 ing of regret that, after obtaining so much valuable information 
 from the report, pregnant with suggestiveness, I could find jio 
 definite suggestion as to how the defects of our own system, as 
 regards municipal administration, can best be remedied. 
 
 Such recommendations as I find contained in the Report, are 
 unquestionably excellent and deserve universal approval. That, 
 however, which most of all redounds to the credit of the Commis¬ 
 sioners, is their conclusion that a Superintendent should be 
 appointed. 
 
 That I should have been driven to the same conclusion as these 
 gentlemen, without being in possession of the information con¬ 
 tained in their report, points to the fact 'that, the idea is not an 
 enterprising venture, nor indeed, a mere matter of opinion, but 
 evolved as the natural outcome of study. 
 
 This is really the point to begin at, to accompli.sh improvements 
 in our system and in our statutory enactments connected there- 
 
48 
 
 with. If the right man be appointed, it will hav,e the effect of 
 guiding legislation, and prevent that patchwork in the statutes 
 relating to municipal affairs, which has had the effect of producing 
 confusing and even contraposed enactments. 
 
 To my mind, the information contained in the report of the 
 Commissioners, points to a very simple and effective remedy for 
 the defects felt in our present system of municipal administration 
 in cities. 
 
 MAYOR 
 
 In my opinion the Mayor should be elected, as at present, by 
 the ratepayers. He should occupy the position of Governor of 
 the City and head of the executive body, but not that of Pre¬ 
 sident or Chairman of the Council. 
 
 ALDERMEN. 
 
 Wards.— I cannot see that there would be any advantage 
 gained by abolishing ward representation. It is quite analogous 
 to the representation of constituencies in Parliament, and not 
 necessarily objectionable. 
 
 It does not appear that the law, as it now' stands, requires that 
 representatives of a ward must reside in the ward w’^hich they 
 represent. It has, however, as far as I am aware, become a very 
 general, if not universal, custom that it should be so. I think it 
 would be well that the Statutes should state speciHcally that 
 residence in the ward represented is not a necessary qualifica¬ 
 tion. It would not prevent the exercise of the right to select 
 local residents, while at the same time it would markedly point 
 to the possibility of other selections being desirable and pave the 
 w'ay for more general selections of members of Council, if it 
 should be deemed desirable. 
 
 Number representing each Ward.— In my last paper, I 
 recommended that the expenditure in wards should be in pro¬ 
 portion to their contributions to available funds, continuously 
 but not necessarily in each and every year respectively. The 
 number of representatives, however, should be in direct proportion 
 to population. 
 
49 
 
 CHAIRMAN OF COUNCIL. 
 
 At the first meeting of each Council, a chairman would have 
 to be elected to hold office during the term for which the Council 
 had been elected to serve. All subsequent meetings of the Council 
 would be called by him. It should be made compulsory for him 
 to call a meeting whenever requested to do so by the Executive. 
 He would, however, have the right to call meetings also on his 
 own responsibility. 
 
 EXECUTIVE OR BOARD OF COMMISSIONERS. 
 
 The desideratum is to obtain an efficient and conscientious 
 Executive. 
 
 I proceed on the assumption that a municipaliry should manage 
 its own affairs. It is repugnant to the spirit of the age, that in 
 any matters of merely local interest, the central Government 
 should interfere. This principle is recognized in the confedera¬ 
 tion of the Provinces, and should be consistently carried out in 
 municipal affairs. It is right for a government officer, by auditing 
 or otherwise, to see that the law is carried out. It is. however, 
 quite a different matter for the Government to interfere in the 
 management of municipal matters, as would be the case if Com¬ 
 missioners managing the affairs of a city corporation, were 
 appointed by the Government. 
 
 The committee system is both cumbrous and irresponsible. 
 The division of the Council into committees, the members of 
 which, must, to do their duty, devote a considerable amount of 
 time to their work, and also attend frequent meetings of the 
 Council, without any remuneration ; necessarily excludes from 
 the Council all those who cannot afford to devote the necessary 
 amount of time to the interests of the city without compensation. 
 It therefore naturally tends to draw to the Council those who 
 hope to derive some indirect advantage by their position, or who 
 hope to accomplish by their influence something in which they 
 are directly interested. Neither idea should ever be entertained 
 by a candidate for municipal honours. 
 
 In a country like this, where there are comparatively few men 
 of means and leisure combined, who are able and willing to devote 
 
 7 
 
50 
 
 their time to public matters without remuneration; in order to 
 induce general interest and activity in aspiring to office and 
 selecting representatives; we must either pay for the services 
 rendered directly by way of salary or devise some means whereby 
 very little time need be occupied by each in the discharge of his 
 duties. It needs no argumen t to show that under the present 
 system we cannot do either one or the other. A careful perusal 
 of the report of the C ommission suggests to my mind that we can 
 do both by the change in our system which I now propose. 
 
 I would recommend that at the first meeting of the Council, 
 immediately it is organized by the election of Chairman, a board 
 of Commissioners be elected from amongst the members ; one only 
 for each department. These, with the Mayor as chairman, to form 
 the Executive, and undertake the entire management of the affairs 
 of the corporation. The legislative functions alone to remain with 
 the Council; such as levying the rates, authorizing appropriations, 
 considering debenture issues, fee. 
 
 I would have the number of the Commissioners, the nature of 
 each commission and the salaries (including that of the Mayor) 
 fixed by Act of Parliament. The salaries on a sliding scale, in 
 proportion to population. 
 
 The departments I would suggest to be as follows : 
 
 Life and Health. —This to embrace inspection of buildings 
 and egress therefrom; analyzing of water used ; prevention or 
 neutralization of sewer gas; cleaning of streets; management of 
 hospitals and all matters relating to life and health. 
 
 PoiJCE AND Fire Brigades. 
 
 Assessments and Licenses. 
 
 Permanent Way—or Streets and Sidewalks. 
 
 Public Works. —This might be subdivided if necessary. 
 
 Law. 
 
 Finance. 
 
 By such a classification, citizens would know who to apply 
 to, and who to hold responsible concerning each municipal matter 
 or question arising. 
 
 By the appointment of Commissioners the evils of the irre¬ 
 sponsibility of the committee system would disappear. The 
 
51 
 
 Commissioners themselves would feel that the citizens were 
 entitled to their unremitting attention to their duties as the 
 qmd pro quo for the salaries received. The remuneration should 
 in my opinion, be liberal; leaving no excuse for inattention to 
 the duties devolving upon them. 
 
 It should be provided by law, that, the Commissioner of life 
 and health be a doctor of medicine of such experience and stand¬ 
 ing as that profession may advise in the framing of the statute • 
 that the Law Commissioner be a barrister of such standing as 
 that profession may advise ; that the Finance Commissioner be a 
 Fellow of the Institute of Chartered Accountants of the Province. 
 The Council might probably be unrestricted in their choice of the 
 other Commissioners. 
 
 Each Commissioner would manage his own department, but 
 would have the benefit of the advice of the others at board 
 meetings. 
 
 Meetings should be frequent. In fact, as their ofiices should 
 he in the same building, they might meet daily. 
 
 TERM OF OFFICE. 
 
 The question naturally arises as to the term of holding office. 
 It is quite clear that to submit the Commissioners to the risk of 
 not being re-elected at the end of one year, would frustrate the 
 objects of the proposed scheme. No professional man could afibrd 
 , to dissipate an existing business at the risk of having to begin 
 life over again at the end of one year. If, however, after shewing 
 his hand for some few years, he fails to get re-elected, it must be 
 ■either from his not giving satisfaction, or from a desire for change 
 on the part of the electors. In either, case the electors ought to 
 have the opportunity of pronouncing at intervals. I would 
 recommend that the members of council be elected for the same 
 jjeriod of time as members of the Legislature. 
 
 If this system were in operation, men of all classes would be 
 willing to represent the citizens as members of the City Council; 
 because they would know that if not elected as Commissioners 
 their duties would not involve the loss of much time. 
 
52 
 
 LIQUOR LICENSES. 
 
 I am very decidedly of opinion that each municipality should 
 regulate the sale of intoxicating liquors. I am opposed to the- 
 license system entirely, and am of opinion that in its place there 
 should he compulsory registration, and that only. If, however, 
 public opinion is not educated up to the point of discerning that 
 the very way to decrease the inordinate use of liquor is to take 
 no notice of it further than to acquaint the authorities of the 
 places where it is sold, and if the licensing system is meantime 
 deemed to be necessary, the municipality and not the Government 
 should regulate such matters. 
 
 Much could be said to shew that licensing is only a protective 
 system to the privileged few, and not in any measure regulative 
 as regards inordinate use of liquor. The only point, however, 
 that falls within the limits of my paper is that the municipalities- 
 and not the Government should regulate that matter. 
 
 I would repeat that I am entirely indebted to the Commis¬ 
 sioners for the conception of the ideas I have enunciated as to 
 the apparent desideratum with regard to the Executive of city 
 corporations. 
 
 Although this appendix to my paper is not directly connected 
 with my theme, and indeed, not considered suitable for discussion 
 by our Institute, the interest just now attaching to such matters 
 will of itself be sufficient apology for introducing suggestions 
 contributed towards the solution of Municipal questions. 
 
 19 Imperial Bank Buildings, 
 
 Toronto, 24th January, 1889. 
 
 WILLIAM POWIS, F.C.A.