Government Bonds of the Liberty and Victory Loan Issues, providing that such bonds as should be so secured by said applicant, were thereupon to be held and used by it as capital assets and not sold without the approval of this Commission until and as the market price of the same should be equal to the par value thereof, pending which the applicant might use the same as collateral security for loans and procure funds for the discharge of the purposes prescribed for the expenditure of the proceeds arising from the sale of said capital stock, and providing further that any discount arising from a sale of any of said bonds for less than the par value thereof should be amortized as by the Commission directed.

This day said matter came on for further consideration upon the Second Supplemental Application of said The Millersburg,, Wooster, and Orrville Telephone Company, representing that, pursuant to the authority of said Supplemental Order and by exchange, at par, of its common capital stock therefore, it has acquired United States Government Bonds of the Liberty and Victory Loan Issues of the principal sum of six thousand dollars, which bonds are now pledged, as collateral security, for a loan of five thousand dollars upon which interest at the rate of seven percentum per annum is being paid while the interest received upon said bonds is at the rate of four and one-fourth percentum per annum, and asking the consent and authority of this Commission to sell, at the market price therefore, plus accrued interest, said United States Government Bonds.

Upon consideration whereof, and being fully advised in the premises, and it appearing that the applicant now has a unappropriated corporate surplus from which may be appropriated the discount at which it will now be necessary to dispose of said bonds the Commission is satisfied that, if and as the applicant shall forthwith amortize the discount at which said bonds be sold, consent and authority for the disposition of the sum should be granted. It is, therefore,

Ordered That said The Millersburg, Wooster and Orrville Telephone Company be, and hereby it is authorized to sell, at the market price thereof plus accrued interest, the six thousand dollars, ($6,000.00), principal sum, of United States Government Bonds, of the Liberty and Victory Loan issues which it obtained by exchange for its common capital stock, and to use the proceeds thereof for the payment and discharge of its promissory notes of a principal sum equal to the proceeds of said bonds. It is further

Ordered, That said The Millersburg, Wooster and Orrville Telephone Company be, and hereby it is directed, forthwith upon the sale of said bonds, to amortize the discount at which the same are sold by charging the same against its corporate surplus. It is further

Ordered, That said company make a verified report of its exercise of the authority herein granted and the amortization of the discount arising from the sale of said bonds.

I. and S. Docket No. 57-In the Matter of the Suspension of Supplement No. 30 to W. J. Kelly's Coal Tariff, Ohio No. 688, Filed by F. V. Davis as Agent, to Become Effective February 28, 1921.Prayer Denied.

(Dated March 29, 1921.)

It appearing that upon January 20, 1921, F. V. Davis, as agent, filed Supplement No. 30 to his Bituminous Coal Tariff known and designated as Ohio No. 688 (W. J. Kelly, agent), to become effective February 28, 1941, and upon protest received from the National Fire Proofing Company as to the increased rate on coal from Haydenville to Altman, Ohio, an order was issued on February 15, 1921, assigning hearing for ten a. m., February 25, 1921; and it appearing that a hearing of the matters and things complained against was had and by order dated Februry 25, 1921, said Supplement No. 30 was suspended from February 28 to March 30, 1921; and it further appearing that sufficient cause had not been made to appear for the increase of this rate beyond the forty per cent. authorized by the Interstate Commerce Commission and concurred in by this Commission, the Commission being fully advised in the premises, find that said proposed increased rate is unjust and unreasonable. It is, therefore,

Ordered, That Supplement No. 30 as issued by F. V. Davis as agent to Bituminous Coal Tariff, Ohio No. 688 (W. J. Kelly, agent) be and the same is hereby rejected. It is further

Ordered, That a copy of this order be filed with the tariff in question now on file with the Commission, and that F. V. Davis as agent be directed to issue a supplement at once notifying all carriers and their agents, parties to said tariff, that Supplement No. 30 has been rejected, and that he be required to issue another supplement within a period of fifteen days from and after the date of this order bringing forward the rates in Supplement No. 30 with proper corrections.

ATTORNEY GENERAL

Where the County Board of Education has Assumed Control of the Schools in a Local School District Under the Provisions of Section 7610-1 G. C., the Moneys Expended by the County Board in Such Local District Become a Charge Against the Local School District and the Amounts so Paid From the General Fund in the County Treasury by the County Board of Education Shall be Retained From the Proper Funds Due Such Local School District at the Time of Making the Semi-annual Distribution of Taxes. Where the County Board of Education has Assumed Control of the Schools in a Local District Because of the Default of the Local Board and the Funds of Such Local District are Exhausted, it Becomes the Duty of the Board of Education in the Local District to Raise the Monev Necessary to Meet the Obligations Incured in Such Local District by the County Board of Education in Keeping the Schools Going. For Local School Purposes Boards of Education in Local Districts May Levy a Tax to the Extent of Three Mills Irrespective of All Limitations Upon Vote of the Electors, as Set Forth in Section 5649-4, 5649-5 and 5649-5a G. C For the Finding of Those Obligations Which are Valid, Existing and Binding, Including the Pay of Teachers, Janitors and School Drivers, Local Boards of Education May Borrow, or Issue Bonds, Without a Vote of the Electors, in the Manner Provided in Sections 5656 and 5658 General Code.

No. 1889-(Opinion Dated March 2, 1921.)

Hon. W. R. White, Prosecuting Attorney, Gallipolis, Ohio. Dear Sir: Acknowledgment is made of the receipt of your request for an opinion upon the following statement of facts:

"One of the townships of this county, to-wit, Clay township, failed to authorize by special election an additional three mill levy so as to enable them to participate in the $500,000 reserve, and the funds of the township for school purposes have been exhausted, and the board refuses and neglects to issue or offer to issue bonds under authority of Sections 5656 and 5658 of the General Code of Ohio as suggested in your Opinion No. 1508, and refuses to carry on the school. The amount of the Clay township school fund to be distributed at the February settlement will not be sufficient to pay the salaries of the teachers or refund any money paid out by the county school board which has now assumed the right to em

ploy the teachers under the provisions of Section 7610-1 G. C. 1. Can the county board of education, under the above statement of facts, proceed to issue bonds under authority of Sections 5656 and 5658 of the General Code-the township board failing and refusing so to do.

2. If so, can they issue the bonds before the employment of the teacher is completed?

There is some question whether the bonds would sell and of the county continues to pay the teachers the county would lose the amount so paid out. If the county board cannot issue bonds the school must close."

Pertinent sections of the statutes are as follows:

"Section 7610: If a board of education in a district fails in any year to estimate and certify the levy for a contingent fund as required by this chapter, or if the amount so certified is deemed insufficient for school purposes, the commissioners of the county to which such district belongs, upon being advised and satisfied thereof, shall perform any or all such duties and acts, in the same manner as the board of education by this title is authorized to perform them."

"Section 7610-1: If the board of education in a district fails to provide sufficient school privileges for all the youth of school age in the district, or to provide for the continuance of any school in the district for at least thirty-two weeks in the year, or to provide for each school an equitable share of school advantages as required by this title, or to provide suitable school houses for all the schools under its control, or to elect a superintendent or teachers, or to pay their salaries, or to pay out any other school money, needed in school administration, or to fill any vacancies in the board within the period of thirty days after such vacancies occur the county board of education of the county to which such district belongs, upon being advised and satisfied thereof, shall perform any and all of such duties or acts, in the same manner as the board of education by this title is authorized to perform them. All salaries and other money so paid by the county board of education shall be paid out of the county treasury on vouchers signed by the president of the county board of education, but they shall be a charge against the school district for which the money was paid. The amount so paid shall be retained by the county auditor from the proper funds due to such school districts, at the time of making the semi-annual distribution of taxes."

"Section 5656: The *** board of education of a school district * *for the purpose of extending the time of payment of any indebtedness, which from its limits of taxation such *** district *** is unable to pay at maturity, may borrow money or issue the bonds thereof, so as to change, but not increase the indebtedness in the amounts, for the

length of time and at the rate of interest that said board *** deem proper, not to exceed the rate of six per cent per annum, payable semi-annually."

"Section 5658: No indebtedness of a school district *** shall be funded, refunded or extended unless such indebtedness is first determined to be an existing, valid and

*

binding obligation of such * * school district * * * by a

formal resolution of the *** board of education * * * thereof. Such resolution shall state the amount of the existing indebtedness to be funded, refunded or extended, the aggregate amount of bonds to be issued therefore, their number and denomination, the date of their maturity, the rate of interest they shall bear and the place of payment of principal and interest."

"Section 5659: For the payment of the bonds issued under the next three preceding sections, the board of education *** shall levy a tax, in addition to the amount otherwise authorized, each year during the period the bonds have to run sufficient in amount to pay the accruing interest and the bonds as they mature.'

In your statement of facts you indicate that the board of education of the Clay township school district "refuses and neglects to issue or offer to issue bonds under authority of Sections 5656 and 5658 of the General Code," for the purpose of the further operation and maintenance of the schools in such district. You further indicate that the county board of education has taken over the operation and maintenance of such schools in this district and has been paying the teachers the necessary expenses of such operation under the provisions of Section 7610-1 G. C. supra, and that "the amount of Clay township school funds to be distributed at the February settlement, will not be sufficient to pay the salaries of teachers or refund any money paid out by the county school board." You desire to know whether the county board of education, under Sections 5655 and 5658 G. C., supra, can proceed to issue bonds in accordance with the provisions of such sections, the local board of education having refused to do so, as authorized in Opinion No. 1508 (Opinions of the Attorney General for 1940).

An examination of the provisions of Section 7610-1 shows that the section is very sweeping in its character in the authority given to a county board of education, for it says:

"The county board of education of the county to which such district belongs, upon being advised and satisfied thereof, shall perform any and all of such duties and acts, in the same manner as the board of education by this title is authorized to perform them."