The Portland daily press., 1878-11-09
The report was signed by L. G. Downes an
Charles e. Jose.

20
The report was signed by L. G. Downes and
Charles e. Jose.
THE MINORITY REPORT.
The Standing Committee .on Taxation and
Expenditures, to which was referred the COM
municaton of Hon. j. 81. Drummond in be.
half of the Maine Central Railroad Company,
asking reduction of the state tax assessed
against said corporation for the years 1874-5-6-7
after full hearing Of the matter and a care
full investigation, are unable to agree as to the
market value Of the stock of said company for
the years above named.
The undersigned respectfully submits M.
Dority report, with an order authorizing such
abatement Tor those years as in his judgment
is just and proper.
1t is somewhat difficult to arrive at o correct
valuation of the shares of the corpora ton
Tie language of the second section of the "act
relating to the taxation Of railroad corpora
tons" rather increases the diff Guilty. 1t pro.
vides shat the Governor and Council shall as
certain the true market value of the shares of
each railroad corporation in the state, and shall
estimate therefrom the fair cash valuation of
all OF said shares, constituting the capital stock
Of said corporation on the first day of April
next preceding, which shall be taken as the
true value of its corporate franchises for the
purposes of this act" The valuation of shares
depends somewhat upon the construction of
this section of said act. The true market
value Of shares in any corporation, as re-
fired to in this act. must be the price at which
actual sales are made. 1t is quite clear that
the Governor and Council assessed the tax up
on that basis. [ cannot see how proper tax
could be assessed upol any other construction
of the law.
The Maine Central Railroad Company has
control over more than three hundred miles of
road, has valuation exceeding ten millions Of
dollars, is protected by the laws Of the State,
and should bear its just proportion Of the bur
dens of taxation. Claiming exemption under
their charter, they have for nearly four years
resisted, by legal means, the collection of the
their efforts at law, they now sesk relief at the
hands of the Governor and Council, as provid-
ed in chapter AZ. laws Of 1878.
1t is well known that a very large number Of
shares CT this corporation changed hands in
1873 at fcom sixty to one hundred dollars Der
share, and that the friends Of the company
were active in purchasing shares at these fig
ures. The value OF the shares could not have
materially changed at the date of the assess
NETT in 1874. The tax of that year, in my opin-
ion, is not excessive. and only such an abats-
ment should be made as is necessary to correct
errors in the amount paid by the company fJr
local taxes.
1t appears from recent returns, showing the
amount that this corporation paid on account
of local taxation, that the Council, in assessing
the railroad tax in 1896, did not deduct the
foil amount paid by said corporation for local
taxes. This error was the fault of the compa-
ny in not furnishing the necessary information
on that point. The correction of this error er-
titles the company to an abatement of fifteen
hundred dollars on the tax assessed against
them for each Of the years 1S745-6. The off
GERS of the company, neglecting to appear be-
fore the Governor and Council when the tax
was assessed, ought not at this late day to COM
plain that the tax OF that year was excessive.
The value of the shares of this corporations
in 1875 it is more difficult to fix, as bat few
shares for the year previous changed hands,
The Council of that year made careful in
quiries as to its market value. The large stocR-
holders OF 1873 still retained their stock, which
is good evidence that they continued their con-
fdence ia its value. Had it largely deprecated
they could have appeared before the Council,
when the tax was assessed, and shown that
fact; lot appearing, it is fair to presume that
they preferred to accept the Judgment of the
board as to its market value. In view of all
the facts and circumstances connected with the
assessment of 1875, am OF the opinion that
f, rty dollars per share would not bs excessive.
TIE corporation is entitled to credit for error in
the amount deducted for local taxation for that
year.
Nearly the same difficulty arises in fixing the
valuation of shares for 1876, the stock being
held by the same parties If held for the pur-
pose OF controlling this gigantic corporation, it
certainly had value. Large holders were not
only were sold, hardly enough to establish its
value. Nevertheless, in the absence of
definite basis for valuation, the sum of thirty
dollars per share may bs accepted for 1876.
On the tax for 1877 no abatement should be
allowed.
The total tax assessed for the years 1S74-5.6,
against this corpor alton, was $50, $50 81 De.
ductiDg error on account of local taxation and
excessive valuation of shares, say S1O.4l2 "a,
leaves b dance due the state of $45, 126 81,
the interest on which to Oct. Isl, 1873, is
IS 902.9l, making the sum of 1914 02978 due
the state for the tax and interest of thnsa wars
The accompanying order, the passage of which
is recommended, authorizes the ATTACHMENTS and
direc the State Treasurer to collect interest on
the several assessments from the date they
became due and payable, together with cost of
suits prosecuted by the state for the collection
of said taxes
Respectfully submitted,
s. G. HATCH
The order referred to makes the abatement
for errors, of $40, 412