the taxing or licensing power of government." The court held to be unconstitutional the act of 1896, chap. 448, which, among other things, required every owner of a dog in specified cities to pay to an incorporated society for the prevention of cruelty to animals an annual license fee. "If the appropriation to the defendant of license fees prescribed by this statute is a gift of money to, or in aid of, an association, corporation, or private undertaking, then it is in conflict with the constitutional provision." The society is not a subordinate governmental agency, and the statute, "so far as it compels the owners of dogs to pay license fees to the defendant for the purposes prescribed in the statute, is an unauthorized appropriation of public moneys, and is in conflict with the Constitution."

In People ex rel. New York Inst. for Blind v. Fitch (1897) 154 N. Y. 14, 38 L. R. A. 591, 47 N. E. 983, it was held that "the state could appropriate its funds for the education and support of the blind, and that counties might appropriate the sum required for clothing the indigent pupils therein who were residents of the county making the appropriation."

§ 10. [Counties, cities, and towns not to give or loan money or credit; limitation of indebtedness. ]-No county, city, town, or village shall hereafter give any money or property, or loan its money or credit to or in aid of any individual, association, or corporation, or become directly or indirectly the owner of stock in, or bonds of, any association or corporation; nor shall any such county, city, town, or village be allowed to incur any indebtedness except for county, city, town, or village purposes. This section shall not prevent such county, city, town, or village from making such provision for the aid or support of its poor as may be authorized by law. No county or city shall be allowed to become indebted for any purpose or in any manner to an amount which, including existing indebtedness, shall exceed ten per centum of the assessed valuation of the real estate of such county or city subject to taxation, as it appeared by the assessment-rolls of said county or city on the last assessment for state or county taxes prior to the incurring of such indebtedness; and all indebt

edness in excess of such limitation, except such as may now exist, shall be absolutely void, except as herein otherwise provided. No county or city whose present indebtedness exceeds ten per centum of the assessed valuation of its real estate subject to taxation shall be allowed to become indebted in any further amount until such indebtedness shall be reduced within such limit. This section shall not be construed to prevent the issuing of certificates of indebtedness or revenue bonds issued in anticipation of the collection of taxes for amounts actually contained, or to be contained, in the taxes for the year when such certificates or revenue bonds are issued and payable out of such taxes. Nor shall this section be construed to prevent the issue of bonds to provide for the supply of water; but the term of the bonds issued to provide the supply of water shall not exceed twenty years, and a sinking fund shall be created on the issuing of the said bonds for their redemption, by raising annually a sum which will produce an amount equal to the sum of the principal and interest of said bonds at their maturity. All certificates of indebtedness or revenue bonds issued in anticipation of the collection of taxes, which are not retired within five years after their date of issue, and bonds issued to provide for the supply of water, and any debt hereafter incurred by any portion or part of a city, if there shall be any such debt, shall be included in ascertaining the power of the city to become otherwise indebted. Whenever the boundaries of any city are the same as those of a county, or when any city shall include within its boundaries more than one county, the power of any county wholly included within such city to become indebted shall cease, but the debt of the county, heretofore existing, shall not, for the purposes of this section, be reckoned as a part of the city debt. The amount hereafter to be raised by tax for county or city purposes, in any county containing a city of over one hundred thousand in

habitants, or any such city of this state, in addition to providing for the principal and interest of existing debt, shall not, in the aggregate, exceed in any one year two per centum of the assessed valuation of the real and personal estate of such county or city, to be ascertained as prescribed in this section in respect to county or city debt.

[As amended in 1899, Am. 1874; Am. 1884; Const. 1894, art. 8, § 10.]

The legislature of 1903 adopted an amendment to be submitted in 1905, adding to the seventh sentence of this section a provision relating to water debts in the city of New York.

The amended sentence reads as follows:

All certificates of indebtedness or revenue bonds issued in anticipation of the collection of taxes, which are not retired within five years after their date of issue, and bonds to provide for the supply of water, and any debt hereafter incurred by any portion or part of a city, if there shall be any such debt, shall be included in ascertaining the power of the city to become otherwise indebted; except that debts incurred by the city of New York after the first day of January, nineteen hundred and four, to provide for the supply of water, shall not be so included.

The remainder of the section was not changed. See last paragraph of preface to this volume.

In the chapters on the Convention of 1867 and on the Commission of 1872, I have given a sketch of the history of this provision, which was proposed in the Convention, once agreed to, and afterwards abandoned, and which was considered again and recommended by the Commission, and included in the amendments adopted in 1874. The second part of the section, relating to the limitation of local indebtedness, was added in 1884, by legislative

amendment. This provision was further modified by the Convention of 1894, and by a legislative amendment adopted in 1899.

This section has no retroactive effect. Rogers v. Smith (1875) 5 Hun, 475.

This section, adopted in 1874, had the effect to abrogate all provisions of law authorizing the bonding of towns for railroad purposes, and took away the power of railroad commissioners to subscribe for stock; but the amendment did not affect existing contracts. Buffalo & J. R. Co. v. Railroad Comrs. (1875) 5 Hun, 485; People ex rel. Hetfield v. Ft. Edward (1877) 70 N. Y. 28; Falconer v. Buffalo & J. R. Co. (1877) 69 N. Y. 491, affirmed in (1880) 103 U. S. 821, 26 L. ed. 471; Cherry Creek v. Becker (1890) 123 N. Y. 161, 25 N. E. 369.

A municipal corporation cannot, against its consent, be compelled to take stock in a railroad corporation. People ex rel. Dunkirk, W. & P. R. Co. v. Batchellor (1873) 53 N. Y. 128, 13 Am. Rep. 480.

GRATUITIES.

The act of 1876, chap. 445, directing the issue of bonds by the city of Albany for a specified street improvement, and providing for the reimbursement of the city by taxation of the property benefited, was not a loan of the city's credit. The primary liability was upon the city, but the ultimate liability was upon the property and persons benefited by the improvement. People ex rel. Washington Park v. Banks (1876) 67 N. Y. 568. The same statute was also considered in Hurlburt v. Banks (1876) 52 How. Pr. 196.

The act (1876, chap. 66) authorizing municipalities to exchange railroad bonds for stock of the company, which bonds had been exchanged for municipal bonds given to aid in the construction of the road, was held to be a violation of the provision against loaning municipal credit to private corporations. Wheatland v. Taylor (1883) 29 Hun, 70.

A town collector deposited a part of the taxes collected by him in a bank which afterwards failed, and the money so deposited was lost. The collector was not relieved from liability by the failure of the bank and the loss of the money. "The legislature can not authorize, and the county and town authorities cannot make, a levy and take the property of the taxpayer to relieve the collector from his loss." Such taxation was an appropriation of private

property for a private purpose, and was a mere gratuity. The collector had no equitable claim against the town. Mercer v. Floyd (1898) 24 Misc. 164, 53 N. Y. Supp. 433.

The act of 1900, chap. 614, authorizing the rehearing of a case which had passed to final judgment, and directing the payment of the amount which might be found due on such a rehearing, was an unconstitutional interference with the rights of parties as determined by the judgment. Where a final judgment "is upon the merits, for the legislature to vacate or disregard it, and direct the levy of a tax to pay it, either without a new trial or with judgment upon it, would be the bestowal of a gratuity. But where such judgment is not upon the merits, but because of some defect in the authority of the officers to bind the municipal body for which they assume to act, and thus in good conscience is not decisive against the justice of the claim, the legislature may, in order that justice shall prevail, direct its re-examination and determination, and, if found to be just, direct that it be provided for by taxation." In this case the judgment passed against the receiver upon a full examination of the merits, and not because of any disability of the county to do right, or lack of liability to respond, as the merits might require. The legislature had no power to open the judgment. Re Greene (1901) 166 N. Y. 485, 60 N. E. 183.

A contract for a street improvement which requires a city to raise the amount of the contract price by assessment upon property benefited, and pay it to the contractors, does not violate the provision against aiding corporations or individuals. Kronsbein v. Rochester (1902) 76 App. Div. 494, 78 N. Y. Supp. 813.

The act of 1899, chap. 711, authorizing the board of revision and assessments of the city of New York to ascertain and determine the damages caused by the change of grade of certain streets, did not authorize the payment of damages to a person who acquired title to adjoining property after the change had been made. The municipality was under no legal or moral obligation to pay to him damages which may have accrued to his predecessor. Payment to the present owner in such a case would be a mere gratuity. People ex rel. Stephens v. Phillips (1903) 88 App. Div. 560, 85 N. Y. Supp. 200.

The grants to the Mount Sinai hospital of certain lands in the city of New York, pursuant to Laws 1898, chap. 257, and Laws 1900, chap. 166, were "in all essential respects gifts and endowments," and operated "in legal effect as a gift of public property for a