270 THE FISCAL PROBLEM IN MISSOURI 
and public school buildings. Of this amount, the $2.1 
million for public school buildings could be excluded from 
the program of capital financing if it were decided to 
provide for this form of aid, along with other forms of 
state aid to consolidated districts, out of current revenue. 
An important phase of the problem of capital financing 
grows out of the need for certain vital adjustments that 
seem necessary in the revenue system of the state! An 
attempt to finance a large amount of capital needs out of 
current revenues, before or during the time when important 
changes in the revenue system, particularly in the adminis- 
trative machinery, are put into effect, might readily bring 
about an increase in rates of taxation out of proportion to 
the actual requirements. A greater degree of equity can 
be obtained if the capital needs are financed by means of a 
bond issue, since it will be possible to make the adjustments 
in the revenue system before a large part of the funds neces- 
sary for debt service are raised. 
The conclusion that a bond issue represents the most 
logical solution of the problem of financing capital expendi- 
tures that are in the nature of an accumulated deficiency 
has not been reached without considering all angles of the 
problem. The excessive use of credit is not commendable, 
and Missouri has been conservative in using its credit re- 
sources to provide capital facilities. A credit position has 
been maintained which would enable the state to borrow at 
favorable rates should the exigency arise. At the present 
time the only outstanding indebtedness of any conse- 
quence is that incurred for highways and the payment of the 
soldiers’ bonus, and ample provision has been made to 
service this indebtedness. 
If the bond issue plan of financing the present capital 
requirements were adopted, it would be desirable to develop 
a workable plan of financing the capital needs that may 
develop later. It is obviously difficult to determine in 
advance just what capital requirements will be in evidence 
a number of years hence. In formulating such a plan, not 
all factors could be taken into account, but it should go a 
1 The adjustments in the revenue system referred to are considered in detail in 
Chapter XI.