Money grows on trees

Who says money doesn't grow on trees?

More than sixty years ago the city of North Bend, Oregon found its way out of a financial crisis by using the richly-grained and multi-hued wood to produce emergency money. And it's money that is as good today as it was back in 1933!



This story begins on February 11, 1933, when North Bend's only banking facility locked its doors. This was more than a month before President Franklin Roosevelt ordered a nationwide bank closure to end depositors' "runs" and to reorganize the banking system under the Glass-Steagall Act. According to bank officials, the sudden and unannounced local closure was to be temporary, giving the institution time to gather additional resources.



Among depositors of the locked bank was the city of North Bend. Lacking access to their impounded funds, officials were unable to pay employee salaries and other bills for the city of nearly 4,000. The city was by no means insolvent; it just could not get its municipal hands on the monies needed. The First National Bank of North Bend remained closed, but was not bankrupt!



At the March meeting of the city council, Ordinance #653 was given its mandatory three readings and passed with "aye" votes from Councilmen A.E. Morten, William Dolan, M.H. Klockers, J. Ryan, and M. Richardson. The ordinance authorized the issuance of $1,000 worth of myrtlewood discs to be used temporarily to pay salaries and bills.



The tokens; in amounts of $.50, $1, $2.50, $5, and $10, were to be redeemed by the city from June 15 through July 15 of that year. The city council expected the bank to be fully operational by that time.



The mayor, Edgar McDaniel, and Irvin Ross, an employee of Duncan's Myrtlewood Crofters(our original namesake), collaborated on designing and printing a sample coin. The council rejected the sample. They ordered this first sample "run" to be destroyed. W.H. Wann, a public accountant and a very serious amateur coin collector, had a sense of value. He strongly advised the council that a more attractive design would be more suitable to convey community pride.



Only one two-sided example of that first experimental printing survives as it missed the furnace door, rolling unseen into a wall niche behind the furnace at the myrtlewood crofters. It was not found until nearly 20 years later during a remodeling project.



George Vaughn, a local artist, recalls being consulted about a design, but believes a commercial firm did the actual graphics. Rose prepared quarter-inch thick discs in five different diameters. Harold McDaniel did the actual stamping and printing on a small Chandler-Price press in his father's newspaper office.



The young pressman remembers the task as a slow and tedious one as each disc required varying amounts of pressure, according to the softness or hardness of the wood. Discs snapped too often when too much or uneven weight was exerted on the platen.

To preserve the printing, another employee, Mrs. Fred B. Hollister, wife of the City Recorder, brushed each circle with shellac.

The March 10 issue of the "Harbor" carried the news that the script would be issued under a surety bond to be secured by City Treasurer, Irwin N. Hartley. Hartley was also keeping all available city funds in a safe in his office.

A week later the newspaper printed the following article:



…"The money will go into circulation at once in payment of salaries of employees of the city. They in turn will pass it out to merchants for merchandise or purchases of whatsoever nature, and the merchant will pass it out to his employees. Those who receive the money through their regular channels of business should make an effort to keep the money in circulation, instead of storing some away. In this manner, the fullest possible benefit may be obtained."



Although exactly $1,000 was the amount authorized, no record is available of the amount actually put into circulation, nor of the exact number of coins of each denomination. It is interesting to note that the North Bend City Council minutes make no mention of the formal receipt of money. Also, there is no record of a surety bond guaranteeing the financial solvency of the emergency money.



A brisk demand for the mintage by souvenir hunters and coin collectors developed. Mrs. Etta Black, assistant in the March 24 edition of the "Harbor" urged the townspeople, "Bring your wooden money to us" because "Myrtlewood Money is Good Money". More than 30 stores, businesses, and professional services participated.



Due to the success of the first issue, Wann appeared before the April 11 meeting of the city council to present a plan for a second $1,000 issue of coinage. In just eleven days the new issuance was cut, printed, and in circulation, bearing a redemption date of December 1, 1933. Face values were altered so that the $2.50 was dropped and a 25-cent coin was added. The new set now had values of $.25, $.50, $1, $5, and $10, and were slightly smaller than the first issue. A circle of myrtlewood leaves formed the outside edge of the disc, thus helping to equalize the pressure during printing, and cutting down on the number of broken coins.

To remind citizens of the need to circulate the myrtlewood coins, the city sponsored a full-page newspaper ad in late May to congratulate the 50 graduates of North Bend High School, and to encourage district patrons to pay their street assessments with myrtlewood money.

Although bank funds remained impounded, the City Treasurer had managed to gather enough ready cash by early June to call for the redemption of the first issue. It was hoped that actual cash out in general circulation would be helpful to the economy of the entire area.


Later, several other appeals for redemption were made. Speculation grew on just how much money would be kept in private hands. (And, remember that there was no record of the actual value of the myrtlewood tokens issued.)



Perhaps one of the reasons North Bend citizens were able to put away a few pieces was that they did not feel the 1933 depression so acutely. The "real depression" had hit North Bend in 1926 when fire destroyed the city's principal employer, the "A" section of the Stout Mill complex.



Interest in the novel money was not limited to the local area. The Chase Manhattan Bank of New York wrote to the City Treasurer to inform him that they had placed a full issue of myrtlewood script on permanent display in their coin collection. They complimented the city on the quality of the coinage.



Although city officials planned to destroy the wooden money after it had served its purpose, so many citizens kept their pieces that it was decided to leave the coins in circulation. Neither issuance had carried a final redemption date. In other words, there is no date beyond which the city will honor the coins and exchange them for "real cash".



Until recent years, the myrtlewood discs would occasionally be cashed in at local banks and then redeemed by the city. The coins were placed on sale at face value from an informal cardboard box container kept in the city hall safe. It is no longer possible to secure a coin in this manner.



The saga of the First National Bank of North Bend had a happy ending. Approximately two years after the closure, a new bank took over and paid all depositors one-half of their funds. Later the bank stood good for the remainder, plus interest as allowed by the government. No one lost money, just the use of it for a two-year period.



So, the "money-grown-on-trees" venture turned out to be a profitable one for the city of North Bend. Its happy ending includes the addition to the world of numismatics of a highly prized and valuable set of wooden tokens that are really much more than just tokens. Remember "Myrtlewood Money is Good Money".



How many complete 10-piece sets are in existence today is a controversial subject among collectors. The answer is probably somewhere between four and six. The rarest and most difficult coin to obtain is the first issue $10 piece. And don't bother to ask about the value! No collector is willing to sell, and no one is willing to quote a price.



SPECIAL NOTE: As part of North Bend's celebration of Oregon's Centennial, in 1959, the Chamber of Commerce promoted souvenir tokens with a $.50 redeemable face value. The discs were sold to the public with the Chamber receiving the profit. Although easily confused due to the myrtlewood used, printed design and sponsor distinguish the 1959 issues. Only the 1933 coins are still redeemable and recognized currency within the city.

From Myrtlewood Money