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"No $11 Gin Fizz or $7 Cocktail While I'm

Auditor," Says Roady.

Cites Graft and Waste in Other Strike Wars by the Military as Reason for Care Now -Law Sustains His Present Policy.

Because of the criticism of his acts as state auditor in holding up the bills presented by the military authorities of the state for expenses incurred in the occupation of the coal camps of Southern Colorado by the soldiers, Roady Kenehan has issued a statement defining his duties and answering the attacks.

He quotes from the decision of the supreme court of Colorado and says that it not only orders him to "audit" the bills but to "adjust" them as well. Owing to the refusal of the chief justice of the supreme court to interpret certain language in their recent opinion, the state auditor says that he is still "sitting on the lid."

Auditor Kenehan's statement in full:

The editorial "Let us have common sense” in the November 25th issue of the News and your personal offer of space to me for a defense of my policy regarding the issue of certificates of indebtedness, prompts me to "take the people into my confidence."

I have always believed in the people of Colorado. I consider the citizens of this state to be fair and just. Whenever they were seemingly unfair or unjust, they had been misinformed or misguided. As a state official I have always been plain with the people and they have been very fair with me.

No $11 GIN FIZZ OR $7 COCKTAIL. My policy is simply not to tolerate or connive in any scheme that may force the taxpayers to pay $11 for a single gin fizz, $7 for a single cocktail or thousands of dollars for balls, parties and other entertainments of the military to which questionable women were invited and hundreds of dollars for carriages to take these women to the land of the forbidden.

These things have happened in Colorado within ten years and the taxpayers are now shouldering a debt of $1,500,000, because the state auditor's office did not prevent it. Ask General Chase. He was a member of the military board which audited the bills; or come to my office at the capitol and see the records. Such things will never happen while I am auditor of state. Also I am opposed to borrowing money to pay a debt that does not exist.

Let us consider what is meant by a certifi'cate of indebtedness. It is a confession by the

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state that out of money collected from taxpayers for the two years of the administration there is not enough to meet expenses. means the taxpayers' pockets must suffer a deeper probe later on to make up the debt. When a crisis arises in a state, as example when the militia is called out, the state must meet the additional expenses or issue certificates of indebtedness, after a debt has been contracted.

REDEMPTION NO HAPPY PROCESS.

The taxpayers do not throw their hats into the air with glee when they are called upon You to redeem certificates of indebtedness. will remember that the debts contracted by the perfidious Robber Seventh general assembly and the so-called Peabody War were submitted to the people at the polls three times. The first time the debts were repudiated by the taxpayers. The second time the holders of the warrants agreed to take the principal and let the state keep the interest, which amounted to more than the principal, but again the people voted "No."

The third time the honor of the people was appealed to. They were told the Eastern bankers would not take any of our securities so long as we refused to pay our debts that had been certified by a state auditor. The people grudgingly voted, by a narrow majority, to accept the shameful debt with interest, but so narrow was the majority that the election was protested by the Denver Post at the request of numerous taxpayers. A recount of the vote was made by the state canvassing board and the result finally stood 40,054 for, 39,441 against, majority for, 613.

The Denver Post brought suit and carried the case to the United States Supreme Court, but the bondholders won out.

MUST AUDIT AND ADJUST ALL CLAIMS.

We and our children and an unborn generation will have to pay that debt during the next fifty years, and when the final day of reckoning comes it will have cost the state $6,083,750. As a matter of fact, there was no need of such debt. I checked the accounts after the people had voted on the question, and I discovered that for the Lake City, Trinidad (1903), Telluride, Colorado City and Cripple Creek strike certificates of indebtedness were issued to the amount of $758,737.80.

I went over the records with General Chase, who was a member of the military board that approved these bills. He admitted to me that the actual cost of the strikes was not more than

one-half that sum. The balance was squandered shamelessly by as scurvy a lot of grafters as ever disgraced a state. And the state auditor did not stop it. His signature gives legality to the steal.

"I asked General Chase why he, as a member of the military board, had approved bills for $7 cocktails and $11 gin fizzes, and entertainments and carriages for women of questionable character. He said these bills were passed in his absence and that the minutes falsely showed him present, and that when he did attend meetings the board adjourned without considering bills.

The bonds for the Robber Seventh debts bear interest at 3 per cent. They are selling on the market today at 76 to 78 cents on the dollar. The bonds of the so-called Peabody war are worth today only 85 cents on the dollar. But the people must redeem them with interest dollar for dollar. Talk about injuring the state's credit!

RATE OF INTEREST FOUND TOO HIGH.

As auditor of state, it is my duty to audit and adjust all claims against the state. Το "audit" is to ascertain and certify if an account is legally and properly drawn; to "adjust" is to determine if an account is correct in detail. For instance, a bill for lumber purchased may be legally and properly presented, but it may contain an overcharge or omit an important detail, and the auditor must adjust it. If the auditor audits and adjusts an unlawful claim he is liable to criminal prosecution.

Governor Ammons and Attorney General Farrar maintained that the auditor is merely a ministerial officer or a clerk, and that when the military board, governor and attorney general approve bills, as they did on the Cripple Creek war, he must affix his signature to the certificate of indebtedness without right of protest.

At the time the militia was called there were and there are today sufficient funds in the state treasurer to meet all expenses for some time to come. It was not my contention that I would not issue deficiency warrants, but that I would not do so while there was $500,000 in the treasury. I maintained that the military are as much entitled to actual cash for their services as the governor, auditor or supreme court, and that so long as the funds lasted all should be paid alike. When the cash was exhausted. the governor, auditor, attorney general and military and all state officials alike should be given certificates of indebtedness. The governor and attorney general said state officials should be paid in cash and the military given scrip.

About ten days before the military was called Governor Ammons told me that arrangements had been made with Denver bankers to take $150,000 of certificates of indebtedness at 6 per cent and asked me to issue them. He said Attorney General Farrar had given his legal opinion in favor of this.

I knew that certificates of indebtedness could

not bear a higher rate of interest than 4 per cent according to law, and I felt satisfied that I should not issue certificates until a debt had been contracted. Therefore, I sought other counsel. I consulted several of the most able attorneys in the state and certain judges. Everyone of them informed me that it was clearly illegal to issue certificates of indebtedness until a debt had been contracted, and that if I issued them I was subject to criminal prosecution.

I was instructed that if I could issue certificates for $150,000 I could issue them for $10,000,000 at the behest of any state department or institution and thus plunge the state into hopeless debt. My attorneys based their opinions on sections 6,239 and 4,409 of the revised statutes, Colorado, 1903, which I invited attorneys to read. Two lawyers who were, I believe, angry because I had refused to issue the certificates, looked up the law, and when I chanced to meet them they told me they were surprised at the reading of the law and that I was unquestionably right in my position.

STATE POSITION TO THE BANKERS.

I read the following communication to the representatives of the Denver Clearing House Association at a meeting in the governor's office, October 26:

"Hon. E. M. Ammons, Governor of Colorado. "Pursuant to your request to know my attitude on the issuance of certificates of indebtedress at this time, I desire to state that at this time there is nothing for me to pass upon. If any demand is made upon me at any time in the future for the issuance of certificates of indebtedness I will at that time do that which the law requires me to do, viz., pass on the demand in accordance with the law. Under no circumstances would I issue any certificates of indebtedness unless the claim against the state was a legal and valid one."

I have been a regular delegate and attendant at all the conventions of the American Federation of Labor for the last twenty-nine years. It was known to the governor and all others interested on November 1, that I would leave on November 6 to attend the convention in Seattle. There was no attempt to evade an issue by leaving the city. As a matter of fact I did not leave until a day later in order to get this matter settled, but the military board delayed the thing four days.

The military board met November 6 and passed on a payroll and bills contracted by the soldiers then in the field. I was informed the next morning that the bills would be sent to me immediately. Later I was told they would be delivered at 3 o'clock. I sent for the bills at 3 o'clock, but could not get them. They were not delivered at my office until three days later.

OFFICE ADHERES TO KENEHAN POLICY.

Deputy Auditor, N. A. Ballou, wrote C. M. Fairchild, military secretary, on the 11th that he had communicated with me and was await

ing my advice and direction. His letter concluded as follows: "This office will proceed to audit and adjust said alleged claims as expeditiously as possible." I have already explained what is meant by audit and adjust.

Attorney General Farrar rushed into the supreme court and obtained a writ of mandamus compelling me to issue certificates of indebtedness immediately without auditing or adjusting. I was given until the following Monday to show why I should not obey the order of the court. When the case was heard the attorney general said he wished the court to define my duties. He declared I was merely a ministerial officer, notwithstanding that the late Judge Bliss, of the Denver district court, ruled in a previous case that my duties are numerous and complex, and that I am the sole judge of them until mandamus suit has been brought and the courts have instructed me otherwise.

Attorney General Farrar used the illustration that if the governor bought a horse for $300 worth only $100, I should pay without question, and similarly if the military board purchased shoes for the men at $7, when they were worth only $1.

SAYS COURT UPHELD HIM.

The supreme court decided in my favor that I had the right to audit and adjust, and that I was not merely a ministerial officer, but an executive officer. Furthermore, the court did not instruct me to issue certificates of indebtedness to the amount of $150,000 or any other amount, but the court decided that Section 4409 did not make appropriation for the militia, and I must proceed under Section 6329.

In short, that the militia be paid in certificates of indebtedness after they had rendered service. I have contended that certificates be not issued until the available cash in the treasury has been used. The merchant supplying groceries and clothing to the militia must take scrip in payment, the court held, but the merchant supplying any other department can get cash.

The decision of the supreme court was not clear to me regarding the manner in which the certificates of indebtedness should be issued. This is not unusual. I sought an interview with Chief Justice Musser and asked him whether I should issue the certificates to the pay-master general of the militia or to the individual soldiers and merchants. He refused to construe the law, declaring the court would not pass on the duties of the state auditor.

WHOLE QUESTION UP TO AUDITOR AGAIN.

So the whole question has been passed up again to me for final determination. I notice, however, the News on Wednesday was more liberal. Your editorial seems to tell me what to do, but the chief justice of the supreme court will not incur such risk.

State auditors in the past, by harkening to public clamor and newspaper agitation, have issued warrants for debts amounting to $873,071.84 which were repudiated, principal and

interest, by the supreme court of Colorado. You will find the three cases referred to in No. 23, Colorado Reports, Mutual Benefit Life Insurance Company vs. State Treasurer. These claims were disposed of in the east to investors, including widows and orphans, at a premium. The people lost every cent, notwithstanding the state apparently was behind the debts.

Would it not have been better for the credit of the state and more to the honor of the state auditors if they had not mentioned such illegal debts? Would it not have been better for the courts to have told the auditor what to have done before, rather than afterwards tell him what he should have done, and let innocent investors hold the bag?

CITES HYPOTHETICAL CASES AS PROOF.

Suppose I had listened to the News and certain other newspapers in the state; issued certificates of indebtedness indiscriminately to the inspector general to pay expenses of militia as I had been strongly advised; or suppose I had issued certificates to the banks in the amount of $150,000 before a debt had been contracted against the state, would I not have been more severely criticised than I have been?

It was on Monday, the 24th day of November, that the governor advised me not to issue any certificates until after a meeting of the Clearing House Association, which would meet in his office at 3:30 p. m., and that the manner of issuing the certificates was to be approved by the association, as they were the most concerned and were putting up the money, and the certificates must be acceptable to them.

After this meeting the matter was left in the hands of the attorneys for the Clearing House Association, with the understanding that they would submit to the auditor what would be acceptable to them and also decide if the auditor could legally issue these certificates to the paymaster general in a bulk sum for the payment of the militia. On November 28th, Attorney Rogers, Ellis & Johnson, representing the Clearing House Association, delivered a letter to me, which, in part, reads as follows:

At a conference of representatives of the banks composing the Denver Clearing house, just held, it was agreed that the proposed certifiates to be issued for services of the National Guard and for transportation, supplies, subsistence, etc., may be delivered to the claimants by the auditor, without the intervention of the inspector general.

After court decisions and other advice given freely, the Clearing House Association lawyers decided to whom I was to issue these certificates.

STILL SETTING ON STATE LID.

I wish to "take the people into my confidence," as the News suggested editorially, and to assure them that my signature will not knowingly be affixed to any unlawful account against the state, and when I issue certificates they will be for bona fide debts that have been contracted. I have already rejected several bills submitted to me by the state military boards this month and

stamped across their face, "Not Allowed by the State Auditor," because they did not comply with the law in giving proper details. With my twoedged sword, "Audit and adjust," newly sharpened by the supreme court, I am still sitting on the lid.

ROADY KENEHAN, State Auditor.

Council Warns Laboring People

to Stay Away From
Los Angeles.

Forced finally by existing conditions in the labor market in Los Angeles, which has been glutted by the false and misleading advertisements that have been scattered broadcast over the country by business interests that craftily planned to reduce wages by competition among the workers, the city council Saturday took official notice of the situation and issued a warning to non-resident workers to stay away from Los Angeles.

The resolution was introduced by Councilman John W. Snowden at the suggestion of Acting Mayor F. J. Whiffen, following a conference on the unemployed situation at the office of the civil service commission, where the passage of the resolution was discussed.

Councilman Fred C. Wheeler seconded the motion to adopt the resolution, and Councilman Martin Betkouski said: "I'm heartily in favor of it." Then came the roll call, and the vote was unanimous.

Here's the resolution:

WHEREAS, There is a large number of unemployed in Los Angeles, many of them floaters, who have been attracted here by climatic conditions and misrepresentations that there was a superabundance of work at high wages to be found; and

WHEREAS, The city council has been compelled to appropriate funds to provide additional employment for the class of citizenry that has enjoyed a twelve-months' residence; and

WHEREAS, The city is unable to provide employment for more workers than are now within the city confines; therefore be it

Resolved, That the City Council of Los Angeles does hereby warn and advise all nonresident unemployed not to conre to Los Angeles with the hope of securing employment; and be it further

Resolved, That the City Council request the

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newspapers and press associations to give this resolution the fullest publicity throughout the country, in order that those who are contemplating coming to Los Angeles may be fully advised of the real conditions of the labor market in this municipality.-Los Angeles Record.

DOES UNIONISM PAY?

WATERLOO, IOWA.-The local Typographical Union has just signed a new contract with employers, which increases the day and night scale of $18 and $21 to $19 and $22 for job, ad, and floor men for one year, starting January 1, 1914. During the next two years a $1 increase will be granted, and from 1917 to 1919 the rate will be $21 and $24. Machine operators' wages will range from $22 to $25 the first year to $24 and $27 during the years of 1917-1919. This fiveyear contract will result in the following aggregate increases: First year, $2,860; second year, $5,720; third year, $5,720; fourth year, $8,850; fifth year, $8,850. Waterloo printers point to these figures as a result of trade-unionism, and compare them with the weekly wage of $12 a week, which prevailed here a few years ago under non-union conditions.

FIGHTING WHITE PLAGUE.

JOPLIN, Mo.-Trade-unionists in this locality have joined hands with various anti-tuberculosis societies in an effort to combat the white plague. At a recent convention of unions to discuss this question it was decided to ask the county authorities to provide quarters in the proposed hospital for tuberculosis cases in their first stages.

MEAT FAMINE POSSIBLE. PARIS.-The Slaughterefs' Union has decided upon an immediate strike because their employers have refused to consider a reduction of hours from fourtcen to ten.

SHORTER HOURS FOR GIRLS. TRENTON.-Organized labor started a crusade against the long hour system under which waitresses in this city are forced to labor. It is shown that the girls are worked fifteen hours a day in many cases.

ing my advice and direction. His letter concluded as follows: "This office will proceed to audit and adjust said alleged claims as expeditiously as possible." I have already explained what is meant by audit and adjust.

Attorney General Farrar rushed into the supreme court and obtained a writ of mandamus compelling me to issue certificates of indebtedness immediately without auditing or adjusting. I was given until the following Monday to show why I should not obey the order of the court. When the case was heard the attorney general said he wished the court to define my duties. He declared I was merely a ministerial officer, notwithstanding that the late Judge Bliss, of the Denver district court, ruled in a previous case that my duties are numerous and complex, and that I am the sole judge of them until mandamus suit has been brought and the courts have instructed me otherwise.

Attorney General Farrar used the illustration that if the governor bought a horse for $300 worth only $100, I should pay without question, and similarly if the military board purchased shoes for the men at $7, when they were worth only $1.

SAYS COURT UPHELD HIM.

The supreme court decided in my favor that I had the right to audit and adjust, and that I was not merely a ministerial officer, but an executive officer. Furthermore, the court did not instruct me to issue certificates of indebtedness to the amount of $150,000 or any other amount, but the court decided that Section 4409 did not make appropriation for the militia, and I must proceed under Section 6329.

In short, that the militia be paid in certificates of indebtedness after they had rendered service. I have contended that certificates be not issued until the available cash in the treasury has been used. The merchant supplying groceries and clothing to the militia must take scrip in payment, the court held, but the merchant supplying any other department can get cash.

The decision of the supreme court was not clear to me regarding the manner in which the certificates of indebtedness should be issued. This is not unusual. I sought an interview with Chief Justice Musser and asked him whether I should issue the certificates to the pay-master general of the militia or to the individual soldiers and merchants. He refused to construe the law, declaring the court would not pass on the duties of the state auditor.

WHOLE QUESTION UP TO AUDITOR AGAIN.

So the whole question has been passed up again to me for final determination. I notice, however, the News on Wednesday was more liberal. Your editorial seems to tell me what to do, but the chief justice of the supreme court will not incur such risk.

State auditors in the past, by harkening to public clamor and newspaper agitation, have issued warrants for debts amounting to $873,071.84 which were repudiated, principal and

interest, by the supreme court of Colorado. You will find the three cases referred to in No. 23, Colorado Reports, Mutual Benefit Life Insurance Company vs. State Treasurer. These claims were disposed of in the east to investors, including widows and orphans, at a premium. The people lost every cent, notwithstanding the state apparently was behind the debts.

Would it not have been better for the credit of the state and more to the honor of the state auditors if they had not mentioned such illegal debts? Would it not have been better for the courts to have told the auditor what to have done before, rather than afterwards tell him what he should have done, and let innocent investors hold the bag?

CITES HYPOTHETICAL CASES AS PROOF.

Suppose I had listened to the News and certain other newspapers in the state; issued certificates of indebtedness indiscriminately to the inspector general to pay expenses of militia as I had been strongly advised; or suppose I had issued certificates to the banks in the amount of $150,000 before a debt had been contracted against the state, would I not have been more severely criticised than I have been?

It was on Monday, the 24th day of November, that the governor advised me not to issue any certificates until after a meeting of the Clearing House Association, which would meet in his office at 3:30 p. m., and that the manner of issuing the certificates was to be approved by the association, as they were the most concerned and were putting up the money, and the certificates must be acceptable to them.

After this meeting the matter was left in the hands of the attorneys for the Clearing House Association, with the understanding that they would submit to the auditor what would be acceptable to them and also decide if the auditor could legally issue these certificates to the paymaster general in a bulk sum for the payment of the militia. On November 28th, Attorney Rogers, Ellis & Johnson, representing the Clearing House Association, delivered a letter to me, which, in part, reads as follows:

At a conference of representatives of the banks composing the Denver Clearing house, just held, it was agreed that the proposed certifiates to be issued for services of the National Guard and for transportation, supplies, subsistence, etc., may be delivered to the claimants by the auditor, without the intervention of the inspector general.

After court decisions and other advice given freely, the Clearing House Association lawyers decided to whom I was to issue these certificates.

STILL SETTING ON STATE LID.

I wish to "take the people into my confidence," as the News suggested editorially, and to assure them that my signature will not knowingly be affixed to any unlawful account against the state, and when I issue certificates they will be for bona fide debts that have been contracted. I have already rejected several bills submitted to me by the state military boards this month and

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