The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1874-07-25
Taxation of Railroads.

The question of the taxation of railway cor
porations, under the law of last winter, is ex-
citing considerable attention in official, Legal
and railroad circles, in view of the hostile atti-
ttude Of some of the companies. The ground
OF objection to the payment of the taxss is the
provision in the charter of several of our roads
that they shall pay to the state some portion
of their profits above a fixed amount, and
shall be exempt from all other axes. For
instance, in the Androscoggin and Kennebec
charter, which will be practically the charter
for the whole Maine Central system, when
consolidation, shall have been fully consum
mated. is an express stipulation that when the
net earnings of the road shall exceed 10 per
centum of the cost the road shall pay to the
state one-half, or such other portion as the
Legislature may order, of such excess: anu
that mo other tax than herein is provided
shall ever be levied or assessed on said corpor
alton, or any of their privileges or franchises"
This, of course, is conclusive if the legislature
bad right to make any such guarantee and
concession. 1t is held, however, by eminent
counsel that any such attempt to circum-
scribe the power of future legislatures in the
matter of levying taxes is unconstitutional
and void; aud that no legislature is compe-
tent to cede away or limit the sovereignty and
eminent domain of the state. The illustra-
tion is made that if the doctrine of the rail
roads be correct a legislature might repeal all
laws affecting the sale of Intoxicating liquors
and then grant franchises to sell such liquors
f)r some specified consideration, with pro-
vision that no further restriction or taxation
should ever be imposed. which would fore
close any future legislature from passing any
reguative or prohibitory law which should
impair these granted rights.
The decision of the United States
Supreme Court seem very strongly in
favor of the railroad view of the situation.
In the ca,e of Humphrey VS.. Pegnes, 16
Wallace, 249-a South Carolina RAILROAD tax
case, involving substantially the same points
as are presented in this state,-Mr. Justice
Hunt closes an elaborate opinion against the
legality of the tax as follows:
Another question is raised to wit:-That
legislature does not possess the power to
grant to corporation a perpetual immunity
from taxation. 1t is said that the power OF
a
sovereign state; that its exercise is political
necessity, without which the state must cease
to exist, and that it is not competent for one !
legislature, by binding its successors, to com
pass the death of the state. 1t is too late TO
raise this question in this court. 1t has been
held that the legislature has the power to
bind the state in relin gushing its powers to
tax corporation. Jefferson Bank VS.. Shelly,
Black, 1861. 1t has been held that such
provision in the charter Of an Incorporate N
constitutes a contract which the state NAV
not subsequently impair. providence Bank
VS. BILLINGS, Peters, 514. Dartmouth Col
Iege VS.. Woodward. Wheaton, SIS. Bing-
hampton Bridge, 3 Wallace, 51) These doc
trines have been reiterated and re-affirmed SO
re rentIy as the year 1871, in an opinion de-
livered by Mr.. } .lstice Davis, in the case OF
the Viii nington Railroad VS.. Reid (13 Wal
lace. 264). They must be considered settled
in this court.
recent decision, not yet published, is said
to distinctly re-afirm aud approve this DO
sition.
Whether the railroads will carry their ap-
parent disposition to avoid the tax to its
logical conclusion will be seen shortly. 1t is
certainly worth their while TO consider if
graceful submission be not the wiser course =;
for if the state be defeated in this effort the
roadbeds may be exposed to municipal taxa
ton by simple repeal of the general statute
exempting them. This would throw open
more thaa $20,OoOOOO worth of property to
the imposition of locol taxes, and would be
much mole burdensome to the roads than the
tax of last winter.