CHAPTER IV

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THE REVENUE OF GARDEN CITY--GENERAL OBSERVATIONS ON ITS EXPENDITURE.

Before entering upon the question which presented itself at the conclusion of the last chapter--that of endeavouring to ascertain whether the estimated net available income of Garden City (£50,000 per annum) would be sufficient for its municipal needs, I will very shortly state how it is proposed to raise the money required for commencing operations. The money would be borrowed on “B” debentures,[9] and would be secured by a charge upon the “rate-rent,” subject, of course, to the payment of interest and sinking fund in respect of the “A” debentures on which the purchase money of the estate is raised. It is, perhaps, superfluous to remark that, though in the case of the land purchase it might be requisite to raise the whole, or at least some very considerable part of the purchase money before possession would be given of the estate, or operations upon it commenced, yet in regard to public works to be carried out upon the estate, the case is quite different, and it would be by no means necessary or advisable to defer the commencement of operations until the whole sum which might be ultimately required should be raised. Probably no town was ever built on such onerous conditions as would be involved in the raising at the outset of such a very considerable sum as would defray the cost of all its public works; and though the circumstances under which Garden City is to be built may be unique, there is, as will by and by be seen, not only no need for making an exception of the town in respect of initial capital, but quite exceptional reasons will become more and more apparent which make the overlaying of the enterprise with superabundant capital altogether unnecessary, and therefore inexpedient; although, of course, there must be a sufficient sum to enable all real economies to be readily effected.

Perhaps it may be well in this connection to draw a distinction as to the amount of capital required between the case of the building of a town and the building, let us say, of a large iron bridge across an estuary. In the case of the bridge it is highly expedient to raise the entire sum required before commencing operations, for the simple reason that the bridge is not a bridge until the last rivet is driven home, nor, until its entire completion and its connection with the railways or roadways at either end, has it any revenue-earning power. Except, therefore, on the assumption that it is to be fully completed, it offers very little security for the capital sunk upon it. Hence it would be very natural for those who are asked to invest to say, “We will not put any money into this enterprise until you show us that you can get enough to complete it.” But the money which it is proposed to raise for the development of Garden City site leads to speedy results. It is to be expended upon roads, schools, etc. These works will be carried out with due regard to the number of lots which have been let to tenants, who undertake to build as from a certain date; and, therefore, the money expended will very soon begin to yield a return in the shape of a rate-rent, representing, in reality, a greatly-improved ground-rent; when those who have advanced money on the “B” debentures will have a really first-class security, and further sums should be easily obtainable, and at a reduced rate of interest. Again, it is an important part of the project that each ward, or one-sixth part of the city, should be in some sense a complete town by itself, and thus the school buildings might serve, in the earlier stages, not only as schools, but as places for religious worship, for concerts, for libraries, and for meetings of various kinds, so that all outlay on expensive municipal and other buildings might be deferred until the later stages of the enterprise. Work, too, would be practically completed in one ward before commencing on another, and the operations in the various wards would be taken up in due and proper sequence, so that those portions of the town site on which building operations were not in progress would also be a source of revenue, either as allotments, cow-pastures, or, perhaps, as brickfields.

Let us now deal with the subject immediately before us. Will the principles on which Garden City is to be built have any bearing on the effectiveness of its municipal expenditure? In other words, will a given revenue yield greater results than under ordinary conditions? These questions will be answered in the affirmative. It will be shown that, pound for pound, money will be more effectively spent than elsewhere, and that there will be many great and obvious economies which cannot be expressed in figures with much accuracy, but which would certainly represent in the aggregate a very large sum.

The first great economy to be noticed is that the item of “landlord’s rent,” which, under ordinary conditions, largely enters into municipal expenditure, will, in Garden City, scarcely enter at all. Thus, all well-ordered towns require administrative buildings, schools, swimming baths, libraries, parks; and the sites which these and other corporate undertakings occupy are usually purchased. In such cases the money necessary for the purchase of the sites is generally borrowed on the security of the rates; and thus it is that a very considerable part of the total rates levied by a municipality are ordinarily applied, not to productive works, but either to what we have termed “landlord’s rent,” in the shape of interest on money borrowed to effect the purchase, or to the provision of a sinking fund in payment of the purchase money of the land so acquired, which is landlord’s rent in a capitalised form.

Now, in Garden City, all such expenditure, with such exceptions as road sites on the agricultural estate, has been already provided for. Thus, the 250 acres for public parks, the sites for schools and other public buildings, will cost the ratepayers nothing whatever, or, to put it more correctly, their cost, which was really £40 per acre, has been covered, as we have seen, by the annual average contribution of 1s. 1d. per head, which each person is supposed to make in discharge of landlord’s rent; and the revenue of the town, £50,000, is the _net_ revenue after all interest and sinking fund in respect of the whole site has been deducted. In considering, therefore, the question whether £50,000 is a sufficient revenue, it must be remembered that in no case has any cost of municipal sites to be first deducted from that amount.

Another item in which a great economy will be effected will be found in a comparison between Garden City and any old city like London. London wishes to breathe a fuller municipal spirit, and so proceeds to construct schools, to pull down slums, to erect libraries, swimming baths, etc. In these cases, it has not only to purchase the freeholds of the sites, but also has usually to pay for the buildings which had been previously erected thereon, and which are purchased solely, of course, with a view to their demolition and to a clearing of the ground, and frequently it has also to meet claims for business-disturbance, together with heavy legal expenses in settling claims. In this connection it may be remarked that the inclusive cost of _sites_ of schools purchased by the London School Board since its constitution, _i.e._, the cost, including old buildings, business-disturbance, law charges, etc., has already reached the enormous sum of £3,516,072,[10] and the exclusive cost of the sites (370 acres in extent) ready for building by the Board is equal, on the average, to £9,500 per acre.

At this rate the cost of the 24 acres of school sites for Garden City would be £228,000, so that another site for a model city could be purchased out of what would be saved in Garden City in respect of school sites alone. “Oh, but,” it may be said, “the school sites of Garden City are extravagantly large, and would be out of the question in London, and it is altogether unfair to compare a small town like Garden City with London, the wealthy capital of a mighty Empire.” I would reply, “It is quite true that the cost of land in London would make such sites extravagant, not to say prohibitive--they would cost about £40,000,000 sterling--but does not this of itself suggest a most serious defect of system, and that at a most vital part? Can children be better taught where land costs £9,500 an acre than where it costs £40? Whatever may be the real economic value of the London site, for other purposes--as to which we may have something to say at a later stage--for school purposes, wherein lies the advantage that the sites on which its schools are built are frequently surrounded by dingy factories or crowded courts and alleys? If Lombard Street is an ideal place for banks, is not a park like the Central Avenue of Garden City an ideal place for schools?--and is not the welfare of our children the primary consideration with any well-ordered community?” “But,” it may be said, “the children must be educated near their homes, and these homes must be near the places where their parents work.” Precisely; but does not the scheme provide for this in the most effective manner, and in that respect also are not the school sites of Garden City superior to those of London? The children will have to expend less than an average amount of energy in going to school, a matter, as all educationists admit, of immense importance, especially in the winter. But further, have we not heard from Professor Marshall (see heading to