The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1893-02-09
Z axation of Railroad Franchises.

axation of Railroad Franchises.
To the Editor of the Press:
The question of taxation of railroads,
or their franchises, is of late one of the
chief subjects of discussion, and many
are the arguments, pro and con, that are
presented favoring an increase, or giving
reasons why the tax should not be i'm
posed at any greater extent. None of
these discussions seemed to throw any
light upon the fact as to whether they
were paying a fair share of the burdens
of the State, and the reasons offered
were more in the light Of an excuse rath-
er than right the State should exer-
else, or forego if it saw fit for reasons
other than that of justice or equality.
Desiring to ascertain for myself
whether the railroads were paving fair
proportion of the taxes required by the
State, have taken the Maine Central
Railroad, as the one most often men
toned, and made careful examination
of the, taxable value of that system,
which the Statr has right to tax, and l
am surprised to find what seems to me,
has been overlooked by those who take
it for granted that the road does not now
pay it's full share of tax, secured by the
rule now adopted by the State in the
as essment of State taxes.
It is not claimed that the State has any
right or desire to tax other than the
franchise of the road. What is the value
of this franchise. It is represented by a
capital stock of "a, All, 900, and in order
to secure revenue for the right. to op,
crate the road, the State by means of
scale or per cents, a ia is assessed upon
its gross transportation earnin Sand
the tax is thus secured upon its fran
chise.
By this method the State received in
1892, $50, 1896. In addition to this
railroad commissioners tax amounting
to S., 1870 was further assessed. max
ing in all $50, 92O.46 The different mu-
inequalities taxed the property of the
road (which is part of its franchise)
$32, 1860 more, or in ALL $SS, S94. As.
This is $1.9S per cent upon every dollar
of capital stock representing its fran
chise, tax greater than the average
municipal taxation. This large amount
will be increased several thousand dol
lars in 1898, owing to an increase of earn
ings.
The report of the railroad commission
ers is taken for authority. i'm which a
complete exp. Sc of all their transactions
is to be found. Another striking fact,
which has not likely been considered, is,
that according to the Bank Examiners
report of 1891, the savings banks own
ST. 70s, s59.51 of Maine Central bonds,
which under the law taxing savings
banks, the State gets direct without any
expense $40, 313.25, making total of
tire franchise. These are significant fig
ures. If it be urged that this does not
represent the whole value of the road,
but that it's bonded debt should be added
thereto, the fact that the State does not
claim to tax any but the franchise, and
the further fact that the bonds are taxa
BILE under the laws, and by both methods
all the property is open to taxation, is
sufficient answer to this supposed objec
ton. -
These bonds referred to, owned by the
savings banks, worth much more than
their par value, are mostly long bonds,
and afford a security or investment that
make it possible for these banks to pay
depositors a larger rate of interest than
otherwise could be done, and the fact
that any legislation that will affect adj
verselv the interest of this road, must
not only affect the interest of the deposit
tor, but will have depreciating effect
upon every dollar of bonds, or stock of
the road wherever owned.
A bill is already before the legislature,
calling for discrimination in relation to
taxes upon-investments of savings banks /
which are invested in the State. This
bill recognizes the justice of dealing lib
orally with Investments which add to
the prosperity of the people. If it is
important to foster such investments,
can the benefits that come to the State,
and must be dominating factor in our
future advancement, be lost sight Of or
ignored ,,,simplyIbecause they accrue from
The operations of railroad corporation?
The loyal and superb management of
The Maine Central railroad has already
added many millions of additional prop
srty, from which the State is getting its
benefits by way of taxation. Towns
have and are receiving a wonderful de-
gree of prosperity, which could not have
come, except through the energy and
management of eroad. If
capitalists desire to establish manu-
featuring industry, open a quarry
to develop any particular bust
ness, every facility to encourage
the same, even to the building of |
branch roads is quickly responded to |
by the managers. No one who |
will review the past and present care
fully but must observe that from every
part of the country the attention of many
persons is being centered as never before
upon Maine; its opportunities for bust
ness, its health giving climate, its great |
play ground, each, and all are getting a
strong hold upon the business men,
health and pleasure seekers. This era
If prosperity that has come to Maine is
caused largely and almost entirely by the |
systematic policy adopted by this road
which by the expenditure of large sums
Of money, in advertising and otherwise,
who have believed in the future Of Maine,
and backed up their confidence, by I'M
relaxing efforts to center the attention of
the country upon it's varied possibilities.
No doubt great future awaits onr good
state, if the elements now. working. for
,,x,4 Il rroI