The Portland daily press., 1875-01-16
The Governors Message Oh the Rail-
Roads.
To the Editor of the Press:


in relation to the tax on railroads is so re-
markable as to challenge criticism. When
the chief magistrate of state recommends
course of action for the legislature, it is, or
ought to be, presumed that he is master of the
facts in the case and that his recommenda'
tions if carried out will not be in violation OF
his oath of office and that of the legislature,
to support the constitution OF the states and
of the United States. After reciting the pro-
ceedngs of the last year in regard to taxing
the franchises and property of certain rail-
roads IN this state and stating the names OF
the corporations whose property was taxed
and of those that have not paid, the Gov
ernor says ''neither of the other companies
(the Atlantic and st. Lawrence, the Maine
Central, &C., &c.,) has paid any part OF the
tax assessed upon them or gives any eXplana-
ton for non-payment. From unofficial sources
it has been ascertained that the Atlantic q
St. Lawrence and the Maine Central COM
panies claim that clause in their charters ex
empts them from all taxation, until the dI-
rectors of the corporation shall report 10 the
legislature that the net income OF the company
is ten per cent on the cost OF the road ana us
appendaees and Incidental expenses (Which
report has not been made and is not likely to
the corporation shall be limited tax on the
net income of the road above said ten per
cent" Now it is well to examine right here
and see what these companies, the Atlantic
aud st. LAWRENCE, the Name Centrai ana
others do claim. Take the case of the A. & st.
Lawrence-row the Granl Trunk road-the
best known in this city and the acts Incor-
poratng the others are substantially
the same as this. The history of the
granting of this charter is interest
;,c md win do tho GoVprn0r harm to
be informed of it. In 1874 leading citizens OF
Portland conceived the plan of connecting their
city with Montreal by railroad, thus developing
the resources of vast territory, besides CON
Meeting their city with Canada and the West
by means of the railroads then being built
from Montreal, a grand scheme aud one, the
accomplishment of which has been OF vast
benefits to the people OF Maine. But 10 Sc
cure the capital wberewlth to construct sucn
a road was the difficult problem. No cautlons
man then would invest his money in rail-
road to be under the control OF the legislature
nor will they now. The old hostility to cor
porations had engrafted on the statute book
of Maine the act of 1881 sublectlng every cor
poratlon created by the Legislature to the con-
troll of that body, unless especially exempted
In the act creating it. Several acts lncorporat-
ing railroad companies had been passed win
clauses exempting them from the operation
of that act, but only one OF the roads mad Deen
built under them.-the Portland. Saco and
Portsmouth. This simple exemption from the
operations of that act was not sufficient 10 IN
duce cautious men with capital to invest u IN
the building of railroads. And yet IL tne
state were to maintain its position among the
states and retain its population railroads must
be. built The internal commerce OF the s'ate
could not be carried on without them, mucn
less could manufactures be introduced. Ihese
men of Portland led by Judge Preble, John
Anderson, John A. Poor and others,-all now
passed away-went to Augusta at the session
of the legislature of 1915 to procure such an
act of incorporation as would enable them to
secure the money from individuals and cor
porations to build road connecting that city
with Montreal They did not go there to but
ton hole'' or bribe the legislators after the
fashion of the modern lobby but to convince
them by open argument and public discus
sions that the old policy OF the state or
rather of the then dominant party must be
reversed in the interest of the people of the state
That the legislative authority under our consti-
tuition s'to make and establish all reasonable
laws and regulations for the defence and beneht
of the people of the state were ample to au-
thorize them togrant such an act OF lncorpora-
tion as they desired, and that the legislature
was convinced and passed the act incorporat
ing this company and several others now em.
| braced in the charter of the Maine Central
| Company is evident And who doubts
the wisdom and policy of such a grant
oven now. The communities through
which these roads extend, show about the
only increase in wealth. population and
manufacturing industries in the state. Inc
manufacturing towns of Lewiston and Auburn
were little else than open helds when inese
| grants were made. And without the facilities
| of these roads no such enterprise would now be
| found there and so of all the towns through
| which the railroads extend.
1t was the intention of Judge Preble and tie
| others engaged in procuring this act OF lncor-
| poraton to draw it so that the powers and du-
| ties and rights of this company should be clear
| and distinct, while the authority OF the lesis-
| lature over it should also be well dehned ana
| understood. While the power to secure and
| maintain the public safety was retained by the
| state, the power TO alter, repeal or amend the
charter or to alter or regulate the tolls, or tax
| the franchise or property was surrendered OF
agreed not to be exercised except N the man
| ner and to the extent therein PROVIDED. Inc
section containing these provisions IS as fol-
| lows: s16th-Al real estate purchased by SAID
| corporation for the use of the same, under the
ffth section of this act shall be taxable to said
| Corporation by the several towns, cities and
| plantations in which said lands may lie in the
| same manner as lands owned by private per
| sons and shall in the valuation lists be esti-
mated the same as other real estate OF the same
! quality in such town, city or plantation and
| not otherwise, and the shares owned by the
| respective stockholders shall be deemed per-
| sonal estate and be taxable as such to the own
| ers thereof in the places where they may reside
| ana have their home. And whenever the net
| income of said corporation shall have amount
! ed to ten per centum per annum upon the COST
of the road and its appendages and incidental
| expenses. the directors shall make special re-
| port of the fact to the legislature; from and
| after which time one mOiety, or such other por-
| ton as the Legislature may from time to time
| determine, of the net income from said rail-
road accrung thereafter over and above ten
| per centum per anEum, first to be paid to the
| stock holders, shall annually be paid over Dy
| the treasurer of said corporation, as tax, into
the treasury of the state for the use OF the state
| And the state may have and martain an ac-
| hon against said corporation therefor to recov-
| er the same. But no other tao than herein is
provided shall eUer be leyied or assessed on said
| corporation, or any of their privileges or fran
| chses." Can any thing be more distinct and
plain? Every such act of incorporation is
contract between the state and individuSls,
which the state is prohibited by the constitu-
ton both of the state and United States from
passing any act to impair This principle has
| been too long and too often decided by the
court of last resort in the country to be ques-
toned. Aud such extracts are in good faith
binding alike upon the state and the Individu
al In the language of the court in memora-
BILE case "a contract between the state and IN
dIviduals is as obligatory as any other con-
tract Until a state is lost to all sense OF JUS
tice and propriety, she will scppousy abide by
her contracts more Scrupulously than she will
exact the fulfillment by the opposite contract
Ing party" Now the legislature OF 1874 passed
an act authorizing aud directing the Governor
and property of the Atlantic & st. Lawrence
Railroad Co. aud other corporations of the
state of like character of one and one half per
cent upon the value of the franchise and prop
erty. This has been done and the amounG of
tax against the Atlantic & st. Lawrence Co. is
$50 O7S "a, and the Governor does not seem
TO understand why it has not been paid.
He says that from "atnotictal sources it has
been asGertaned that the companies claim that
a clause in their charter exempts them from all
taxation etc. This is very singular. These
charters are public laws which every man,
much more the Governor, is presumed to know
and understand.
In a case precisely like this of the Atlantic &
| st. Lawrence II. Il. and other companies, re-
Gently decided by the Supreme judicial Court
Of the United States, the court says: sit has
been SO often decided by this court that char
| ter of Incorporation granted by state creates
| a contract between the state and the corpo-
| 1atlops which the state cannot violate, that it
| would be work of supererogation to repeat
| the reasons on which the argument is founded.
| 1t is true when corporation claims an ex-
| emption from taxation it must show that the
| power to tax has been clearly rel:nquished by
| the state; if there be a reasonable doubt about
| this having been done, that doubt must be
solved in favor of the state. If however the con
= I