nonpayment of personal tax is ten per cent. When the property is sold in default of the payment of tax, the delinquent may redeem it within two years.

116. Sources of State Revenue. The three important state funds are the general-revenue fund, the sinking fund, and the common-school fund. The first is employed in the support of the state officers, public works, and benevolent institutions; the second is used to pay the interest on the public debt; and the third is applied to the public schools of the state.

The auditor reports taxes from the following sources: county treasurers, show licenses, auction duties, cigarette traffic, liquor traffic, inheritance taxes, collateral inheritance, excise taxes, insurance department, and funds from various state officers, especially the secretary of state.

117. Restrictions in Taxation. The power of taxation is restricted to strict observance of certain laws. Taxes must be applied to the objects named in the laws, and can be drawn from the treasury only by direct appropriation. The state limits its debt-contracting power for current expenses to three quarters of a million dollars. This is a restriction upon the borrowing capacity of the state. Likewise limits in borrowing are placed upon both the county and township, not only in amounts but also in length of time for payment and rate of interest to be paid. In addition to these state funds there are county, township, municipal, and school-district funds. As in the provisions for the state, the laws permit the county and municipality to maintain a sinking fund to take care of the interest and to reduce the principal of the public debt. This fund is supplied through taxation. The public funds are further pro

tected by a provision requiring all officers handling any part of them to give security for faithful performance of their duties. They must submit to the auditing of their books, and also to an investigation of their accounts at stated periods. Moreover, weekly reports must be made to the state treasurer, and weekly comparisons are required between the auditor and treasurer. The bureau of inspection of state officers, with the auditor as chairman, insures accurate accounts in all the financial dealings of the state. The public debt of the state on the fifteenth day of November, 1909, was $1665. This debt was due many years ago, but has never been presented for payment. It is based upon a domestic loan for which a bond was issued, which is probably lost.

QUESTIONS ON THE TEXT

1. Name and locate the various state benevolent institutions aside from the hospitals.

2. Name and locate the various hospitals for the insane.

3. Name and locate the penal institutions.

4. How are these institutions controlled?

5. Define paternalism, and distinguish it from individualism.

6. Specify cases of paternalism in Ohio.

7. Cite cases of the state's protective function.

8. Indicate the state's activity in an attempt to regulate capital and labor.

9. Point out the state's authority over highways.

10. Define corporation. Show that it is a modern institution.

11. Why is the question of vested rights an important one in Ohio ? 12. Enumerate the steps in the formation of a corporation.

13. What is the greatest problem a city, county, or state has to solve?

14. How are taxes assessed?

15. What method is used to render taxation equitable?

16. Explain the method of collecting taxes.

17. Enumerate the sources of revenue.

18. Indicate the amount of taxes raised for current expenses annually.

19. Discuss the limitation of taxation in Ohio.

20. What was the public debt of Ohio in November, 1909? Account for it.

CHAPTER VII

PUBLIC EDUCATION

118. Early History. The clause of the ordinance of 1787 most frequently quoted is that which pertains to the beginnings of the public-school system of the country. It is as follows: "Religion, morality, and knowledge being necessary to good government and the happiness of mankind, schools and the means of education shall forever be encouraged." "The perpetuity of a democratic government depends upon the intelligence of the citizen" is a maxim in the New World. Authority for the establishment of a school system was incorporated in each constitution adopted by the state. At the very beginning the state reserved one thirty-sixth of the township to be used for school purposes. For a time the schools were largely a local matter, but in 1825 the state undertook their supervision, and by means of a system of taxation schools were established in every township. The graded schools and high schools were not a part of the system until 1850. In the preceding year authority was given to create high schools, and they soon became established in the cities. Three years later boards of education were given power to levy a tax to erect schoolhouses.

In 1892 the township became the unit in rural districts, and the township board of education was created.

119. Superintendent of Public Instruction. The constitution of Ohio provides for the appointment of a

superintendent of public instruction by the governor of the state, and it is his duty to collate and distribute the school laws and to provide such forms of regulation and instruction for the organization and government of schools as he may deem necessary. He may require local officials to furnish reports and information with respect to the condition and management of schools and school funds, and he may, upon complaint and through examiners, investigate the condition of school funds and report any irregularities and misapplication of such funds to the proper officials for such action as they may be required by law to take. He has supervisory management of the schools of the state and appoints high-school inspectors and four district supervisors of agricultural education, whose duties are to inspect high schools and to assist in classifying and grading the same and to give direction to agricultural instruction. This power enables him to maintain a uniform and proper course of study for such high schools, so that they may be recognized by the higher institutions of learning. His term of office is four years, and he is required to make an annual report to the governor relative to the educational interest of the state.

120. Classification of Schools. The school districts of the state are classified and styled as city school districts, village school districts, rural school districts, and county school districts.

Each city of the state, together with the territory attached to it for school purposes and excluding the territory detached for school purposes, constitutes a city school district.

Each village, together with the territory attached to it for school purposes and excluding the territory detached for school purposes, constitutes a village school district.