The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1891-08-27
RAILROAD

RAILROAD PROPERTY.
The Tax Commissioner Give Ear to the Rep
rescntatives of Improbable Lines.
At their evening session the State Tax
Commissioner disposed of most of the
railroads which had not Yet been consid-
cred, about the only companies now remain
ing to be heard being the Lake Erie Il
Western. Indianapolis Union, Indianapolis
Belt and Louisville & Nashville. j. b.
Meagher. of Chicago, one of the attorneys
for the Michigan Central. was the first to be
heard. He said his company last year
returned its main track at $40,
600 a mile, and the board raised
the assessment to SCI, 600. The Michigan
Central was generally regarded as one OF
the three wealthy roads running from Chi
cagO to the East, but in reality 1t could not
compare III earning capacity with either
the Pittsbura. Fort WAYNE Il Chicago.
both of which pass through the finest coun-
try in the United States. In order to sub
stantiate this claim. Mr.. Meagher produced
figures showing that the Lake Shores
as against the Michigan Centrals Sl4. 400
000. The gross earnings per mile were:
Lake Shore. SD, 437; Michigan Central, So
004. and TIE net earnings: Lake Shore, S4.-
597; Michigan Central, 1885. Despite this
inequality in earnings, both roads were as
sessed alike on main u second track and
sidings. and the Michigan Centrals rolling.
stock was valued for taxation at $4,000 a
mile, against $500 for the Lake Shore. All
this. he declared. was not only unjust but
outrageous. The Michigan Central has
nearly forty-two and q half miles of main
track in Indiana.
Mr.. Meagher called the boards attention
to n branch line known as the Joliet *
Northern Indiana, fifteen miles of which
lay in this State. This road was assessed
last year at $4,000 a mile for main track.
1t was once a good line. and the assess
ment was then probably all right, but it
had ceased TO DO so and q reduction was
asked. He then told how some
small capitalists conceived the idea
that it was paying enormously,
and decided to parallel it. Accordingly
they asked the State of Illinois TO help
them ont financially and 1t accommodate
ingly taxed tine Joliet ~ Northern Indiana
heavily and handed the proceeds over TO
the new company. That was the way in
which the road was paraileled. and he be-
lleved that If IL was deemed desirable TO
build a third line Illinois would simply
take the Joliet & Northern Indiana from
them, sell it and n the proceeds over TO
the new company. They had been taxed
to death in both States OH the branch.
Mr.. MeaGhe Is a lively ralker. and the
commissioner rather enjoyed his state
ment.
TRUE ASH yALUE
George d.. Penniman, of Baltimore. assist
ant counsel of the Baltimore Ohio ~ Chi
cage Railroad Company. called the boards
attention TO the financial condition of the
road as the controlling element in determln.
ing it's true cash value. The road runs from
Chicago Junction. ", to within eight and
one. half miles Of Chicago. The corporation
ia antiraIv inhaDnpGaut Of The Ralfi-
more ~ Ohio company. The towns
through which 10 runs in Indiana
are small. ranging. from 1000 to 5000. while
IN Ohio they run from $500 to 1000 lnhab-
itants. The earnings OF the are
derived principally. therefore, from the
business originating In Ohio and from the
connection of the line with the other Balti-
more 81 ohio line at Chicago junction.
Lake county, in this State. Mr.. Pennlman
said. was absolutely reproductive, and
furnishes very little or no business to his
company. BY reason of large terminal
exp enses at Chicago the net results
from the operation OF this road
ale reduced to u very small sum. and the
the earnings. being S2.13 per cent. of the
gross earnings. This is u per cent. cOnsid-
erably greater than that of any road run
ming into Chicago.
Tie valuation in the return made by the
company. Mr.. Penninan said. is $500 a
mile for main track. This track could be
made at present for $1,000 a mile, and
the $500 valuation represents the
natural depreciation Of the prop
erty from sage, most of the rail
having been laid ten or twelve years ago.
The Indiana assessment is much higher
than that of other States. OHIO assesses at
$4,000 u mile, including right OF way, and in
that State there Is n much better local bus
in consequence. The buildings in Indiana
are small and of wood. with the exception
of those at Garrett. The road has
but two iron bridges in Indiana: 1t
owns but 500 freight cars. and depends Oh
the Baltimore ~ Ohio for niDety-One loco
1,1l6 freight cars. The road has never been
able to meet it's liked charges in the neces-
sary cost of operation, taxes and interest
on Its bonded and other indebtedness, and
it's deficit last year amounted to 1854. 724.9S
The total amount of its deficit up
to this time amounts to 4.3G6. 0S9.
The stock has no market value, he said,
and, as 1T has never been for sale, 1t was
impossible to give the figures in this re-
gard requested by the board. The bonds
are guaranteed by the Baltimore IL Ohio
company. The net earnings of the road
represent only 2ls per cent. on the amount
invested. and this amount is more
than absorbed by interest on its
In Ohio. where roads are examined and
assessed much moro carefully than is posi-.
BILE under the Indiana system. Mr.. Penni-
man said. the property of the Baltimore &
Ohio is valued for taxation much lower
than here. Commissioner Walker suggest
ed that in Ohio they did not pretend TO az.
sess more than two-thirds of the value OF
the property. Mr.. Penniman replied that
he thought they tried TO get as near as pos
sible to the true value OF railroad property.
His road ran through a much poorer eoun-
try in this State than in Ohio. He did not
like to come before the board and make
q poor mouth" but he was compelled to
urge IL TO take into consideration the roads
financial condition. While the termina
expenses at Chicago drained the very life
blood OF the road, they would be compelled
to ask the Tax Commissioners indulgence
and that the assessment be- made less thar
last year and as low as possible. The state
ment from which the attorney read most o
the above was prepared by B0bert Is
Campbell, general superintendent of thu
road.
AN EXCESSIVE ASSESSMENT.
The Kentucky and Indiana Bridge Com
pany was represented by Col. j. G.. Nc
Leod. who said the cost of their propert,
in Indiana was 81. 200. and that it had
naturally. deprecated IN value since it wa
first constructed. Their last years assess
ment was about S60.U00. which he regarde,
as excessive. The New Albany Belt, Col