Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1880-03-18
THE REVENUE BILL.
A Delegation of Bankers and others Gall
upon the Governor and ask him
IN Veto the Bill

| u Vow OA-4'
A delegation representing the principal
savings banks of San Francisco, Oakland,
and other places, called upon the Governor
Yesterday afternoon at the Executive office in
the Capitol, to protest against the revenue
and taxation bill which recently passed the
Legislature, and to petition the Governor to
exercise his prerogative by vetoing the BILL
Among those present were James de Frem-
cry, D. G. McRuer, w. A. Aldrich, Jerome
Lincoln, o. f. Won Rhein, L. Gottig and
John Ziegenbein from San Francisco Sam
uel Merritt, L. c. Sessions and II. A. Palm
er, Oakland John O'Br;en and L. U. Ship
pee, Stockton, besides large number of
Senators and Assemblymen and prominent
citizens OF Sacramento. At the commence
ment OF the interview ID. G. McRuer said
he was requested, in behalf of the gentlemen
present, to read the following address
To His Excellency George C. Perkins, Governor
OF the State of California; The undersigned officers
OF savings banks respectfully call the attention of
your EXcellency to the express provision for double
taxation contained in the revenue and taxation bill
| Assembly Bill No. 404( which now awaits your ap-
provo or dsapprova.
We refer to the requirements that deposits shall
be assessed for taxation to their respective owners
at the same time that the banks in which they are
lodged are assessed all their assets not exempt
from taxation IL is self-evident that when the de-
positors money is taxed in the form OF coin in the
bank vault, in the shape Of mortgages or other
| loans made by the bank, such tax dminishes his
dividend, and is his part very palpable contri
button to the support Of government II in addi-
ton his credit or Iass-book Is taxed it IS double
| taxation.
Moreover, as the assets of savings banks are in
/ and in "a larrra limited
| bonds, not taxable, the deposition who is assessed
| for his credit or passboO pays IN part taxes on
property which is by the United States laws exempt
| from such burden. The justice which should per-
| wade all legislation public policy, which should
courage proyident habits and equity between the
taxpayers demand that the depOstor should not be
burdened with such double tax, when all other cit
liens pay but once, nor with such single tax upon
property exempt by the laws of the United States.
! The depositOrs themselves have already remonstra
ted against the injustice by the presentation to the
| Legislature Of numerously signed petitions, TO
which the undersigned beg leave to refer. They
have failed to prevent the imposition of the double
tax referred to. The undersigned submit that the
bill states, in effect and in positive terms though
not in these precise words: "All property in the
State shall be taxed once except deposits in savings
banks which shall be taxed twice" practical re-
suit Of the proposed legislation, worthy OF every
careful consideration, is the following:
The onerous discriminating taxation in question
will SO far reduce the net income Of savings bank
depositors that other Investments will be sought
United States bonds and bonds OF the several States
and OF railroads and other CORPORATIONS will be pur-
chased the effect being the withdrawal frem crcula
ton and active in California Of these funds which
have so long and so materially aided in developing
the resources of the State and which has contributed
50 largely to the growth Of towns and cities and by
means Of which persons Of moderate means have |
heen enabled to acquire farms and honesteads |
When the oansble funds in community are main |
y those OF capitalists, who lend only in large
and whose loans made solely with reference to |
their own immediate interest and convenience the |
class OF people who borrow money will realize the |
loss they sustain by the Gripping crushing out of
savings banks. In behalf of their depositOrs in |
fur herance OF the true principles of republican gov
ernment-in the interest OF the public, which |
needs savings banks, as evidenced by the large |
number well of their depOsitors as Of their Dor
rowers, and in accordance with the views laid down
in your Excellencys inaugural address, wherein you |
declare yourself most emphatically and unalter-
ably opposed to double taXaton-the undersigned |
respectfully and earnestly appeal TO your EXcelency
exercise the high prerogative OF your office by
vetoing the and taxation bill in question:
on the ground that it is unequal and unjust, |
placing as it does an undue share OF taxation the
shoulders of savings bank depositOrs, whose only
offense in this connection is that they prudent
industrious and thrifty.
(Sgned) James de Fremery, President San Fran
cisco Savings Union l.. GOttig, President German
Savings Loan Society," Miles D. Sweeney President
HbeInia Savings and Loan Society; Samuel
Cowles, President of the Savings and Loan Society
Security Savings Bank, by Jerome Lincoln, Vice
President A. Well, President Franco American
Savings Bank Adolph C. Weber, President Hum
bOldt Savings and Loan Society.
At the conclusion of the reading Mr.. Nc
Ruer further stated that if the present bill
should become a law it would not only effect
great hardship and injustice to the de-
positors in these banks, which are largely
small depositors, but would also prove disas-
trous to the financial interests of the
State, for if these savings banks are COM
! PEELED to pay or more per cent.
greater tax than other Institutions, they will
all go out of existence that they had been of
vast benefit to the interests Of the State. 1t
seems that the only justification for signing
the bill would be upon the ground that this
tax cannot be collected from the depositors
The presumption is that this law will be en-
forced, and if it is enforced, it will be great
burden upon those who deposit their savings
in these institutions 1t will also have ten
dency TO corrupt these depositors. They will
feel justified in avoiding to pay the second
tax upon this property, and we think that if
you withhold your approval of this bill you
will be acting within the spirit of the Consti-
tuition.
The Governor-I would like to have those
present who have considered this bill so thor.
oughly in the Legislature have an opportunity
to. ask questions if they desire.
Mr.. Wendell-How can we exempt this
form of credit in savings banks and still tax
all other credits in the State?
Answer-In the case of commercial banks
they pay ON their assets. The assets of saw
ing banks are in mortgages which are subject
to taxation, and they are not allowed to de-
duct what is owing their depositors if they
were, there would be nc objection to this bill
QUESTIONABLE not commercial banks taxed
upon their mortgages?
Answer-Yes, but they do not let their
money on real estate, as a general thing but
whenever they did. then there would be
double taxation. Their money is mostly
loaned upon iIdorsed paper, and they thereby
escape principally the evils of this bill, The
direct operation of this law will be to tax
savings bank depositors double to that taxed
to any other individuals.
Mr.. Enos-How would you have drawn the
bill, so as to have avoided this so-called
double taxation?
Answer-The Constitutionrequires all prop
erty to be assessed in proportion to its value.
If 1 have a thousand dollars and you another
thousand, it does not require that your money
shall be taxed twice because [ invest mine
simply in another way.
Governor-Do you not believe that the
Constitution, in taxing credits, admits of
double taxation?
Answer-No, 1 don't believe the spirit of
the Constitution admits OF that
Governor-But the letter does, does it not
Answer-Well, that's questionable.
Governor-If the Constitution permits or
directs this double taxation, then where can
YOU find authority for me to withhold my
signature from this bill?
Mr. Sears called attention to the fact that
this discussion was taking q different range,
and different direction, from what it did in
the Senate, and he would like to have it de-
fined whether q depositor in a savings bank
made the bank its agent, or did the bank be-
come borrower?
Mr.. Wendell replied that if he makes a
special deposit then the bank has nothing to
do with it, but if the bank treats it as its own
then that, is another thing. If the money
still belongs to the depositor after it goes into
| the savings bank, then does the depositor
| have any interest in the security?
| Mr.. Aldrich-Yes, he has an interest all
the way through. A better explanation is
this A capitalist in England sends money
TO an agent in San Francisco for investment
upon real estate 1t is invested andsthere is
but one tax. A depositor goes to a savings
bank and puts his money in. there as his
agent and the bank loans it for him. The
| bank is taxed upon the mortgage, and the de-
positor is also taxed upon his credit with the
bank and there is double taxation. Do the
gentlemen from the Senate, who defend this
bill, admit that double taxation is contained
/ in the Constitution
| Mr. Wepdell-According to nv views of