The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1891-02-05
THE QUESTION OF TAXATION.

One of the acknowledged impedlments
to Helena's growth in population and
prosperity is the holding of large blocks
of real estate within the city limits by
persons who will put no improvements
upon the land, but are willing to reap
whore they have not sown and grow
rich by the enterprise of other people.
The only way to compel such persons to
contribute their share toward the gem
eral welfare is to make it Improbable
for them to hold unimproved property
by a we'll devised system of taxation. Is
it not the right time to move in this
matter now when we are forming a new
city charter?
Prof. Richard 7. Ely, the well known
lecturer on political economy at the
Johns Hopkins university, who has
made a profound study of the subject,
says in his work on ''Taxation in Amer
lean States and Cities" that there is an
almost universal tendency in nj cities
to exempt the non-progressive from the
burdens of government and put them
upon the enterprising. Taxation" he
says, should be SO administered as not
to appear to be a penalty for improve
ments and a encouragement for the en-
terprising. All assessors should be by
law especially directed to assess to the
last dollar of it's true value all
real estate held for speculative pur-
poses. There is a common and ubiquitous
practice, which | observed everywhere
in my Investigations, of undertaking
land held for a rise, ard not used at all,
or used only for some unnatural pur-
pose, as when city sots are utilized as
cow-pastures such land IS occasionally
actually valued as farm land"
Prof. Ely's observations must have ex-
tended to points within a thousand
miles of Last Chance gulch, for he says:
'8Thus men. without a stroke of work,
and even while obstructing the natural
growth of cities, see their property
steadily increase in value, and this is
solely due to the industry and thrift of
their fellows. An aggravated case Of
this sort was reported to me as existing
in Cleveland, and l was told that the
assessed value OF land was increased in
Savannah, Georgia, the moment it was
improved. Much of the property in that
city appears to be assessed at sixty per
cent of its actual selling value, but un-
improved property is assessed for a
smaller relative amount, and thus a
premium put on speculation. One gen
tleman told me that four lots which had
been sold for $4,000 were assessed for
only S1,l00, and that a lot next to one,
he had improved was assessed for only
$1,000 whereas it could not be bought
for less than $500. This gentleman
had bought a lot for 5000 of the city. It's
valuation for taxation was shortly in
creased to $1,000, and as soon as he put.
up a house OF it, the valuation of the
lot was raised to 81 ,90o.'
Investigation by Prof. Ely shows that
the direct effect of such discrimination
against improved property is to discour-
age enterprise and he has found many
communities in which building was re.
tarded because of tho certainty OF in
creased taxation. In his opinion an
exemption of improvements from taxa
ton for two or three years, say until the
third tax levy from the beginning of the
improvement, is a measure to be de-
cidedly recommended. Such a system
would encourage thrift and public spirit,
and induce the Industrious and frugal
to put their savings into homes. On
the other hand the higher assessment
of unimproved property would tend to
break up the large holdings which SO
embarrass the city's progress, and lead
owners of lots to put improvements up
on them that would bring them in
creased
Taxation should be SO adjusted as to
promote enterprise and discourage fos-
silization.