The Yale expositor. (Yale, St. Clair County, Mich.) 1894-current, 1898-04-01

lions for building up state institutions The
eriod Includes the years OF the war between
1861 and 1865, during which the burdens upon
the taxpayers We're greatly Increased and enur-
NOUS sacrifices bad 10 be made. Durin& this
period the percentage of taxes OF the ordinary
taxpayer increased with great rapidity. In 1900,
when the first Republican legislature convened
the rate OF taxation for state purposes was less
than one-third of mill ON the dollar and about
six cents per capita. In 1865 at the end Of the
war, the taxes for state purposes were less than
four mills the dollar and only 81 cents per
capita. In 1895 oar taxes for state purposes had
Increased TO 81 81 per capita (Auditor-General' 3
report for 1896, pages 800 and 800 During the
same period the proportion OF taxes paid by the
railroad companies decreased. In 1850 the rail
roads paid ~ per cent of all the taxes levied
for state purposes In 1895 the percentage had
dropped TO 81 7-1O per cent This percentage
refers TO state taxes alone. The other taxpayers
of the state were called upon to meet a similar
Increase in taxes for local purposes, from winch
the railroad companies in the state have been
entirely free.
The history OF railroad taxation in this state is
very interesting. Under the special charters OF
1S4U the roads were required 10 pay AFTER 1891,
an annual tax OF three quarters OF 4 per cent
upon their capital stock paid In and upon all
loans made by the company for the purpose OF
construction. Upon this basis the taxes upon
railroads In 1895 would have been 2,201 .523 81
instead of S7i1, 40S II. In 1880 the general raj
road law was passed by the first Republican
the taxes OF railroad companies organized under
II at l per cent upon the capital stock paid In.
Under this act, If IL had been left undisturbod
and applied to all railroads, the state would have
received In 1875 S., OBI As instead OF SAL
0iS r. In 1863 tine act was amei ded so as TO re-
qulre the companies TO pay In addition TO the
above 1 per cent upon all moneys realized from
loans muicpa, aid and other sources used In the
construction Of the roads. Every change in the
tystem OF taxation from 1859 TO the present time
with the exception OF the act passed in 1897, has
resulted in decreasing the proportion or taxes
paid by the railroads. In the meantime the
burden of taxation on Others, as already shown,
has enormously increased.
The system of tax on earnings was not adopt
ed until 1874. At that time the railroad com
panies were paying nearly 80 per cent of the
whole tax, not including taxes for municipal pur-
poses. The effect OF the legislation was 10 de
crease the percentage pai6 by railroads In two
years to less than IS per cent. Even the change
made in the Michigan Central charter in lS93,
by which the people were led to believe that the
Michigan Central RailrOad Co, in coming under
the General law as 10 taxation had made a con
cession favorable to other taxpayers, has OPP
Grated 20 decrease the burdens OF that company
The report of the Michigan Central Railroad
Co.. foun, in the railroad commissioners report
for 1896 at page SOL, shows the cost OF Ihe ~
miles OF that road in Michigan TO BE- SO, 4O2.-
G32 ID IaNes computed upon this sulh ulucI VIZ
amount to Sl9O.069 ~ The taxes paid by the
company in 1SO5. under the new act were SID,
515 OF. making the state loser by the change OF
Si5 454 70. This is the loss for a single year.
The repeal Of the charter was made to cover
the taxes Of 1892, that the state has aread'
lost by the change made in 1898 more than
While these reductions were being made in Tn
taxes paid by the railroads they were receiyins
immense favOrs from the state. In 1886 the gen
eral government gave TO the state, 10 ald IN IN
construction OF railroads six sections of land Tor
every mile of railroad that should be built. The
state legislature passed acts TO aid the construc
ton OF numerous railroads and turned over 20
the companies the land given to the state by the
general government. and also exempted the lane
from taxation for seven years in the lower PENN
sua and ten years IN me uppJr Pehlhsu.a
The acts making these grants required the coin
pames TO pay specific annual tax OF ! per cen
gave the Legislature power TO levy fuither la
after ten years OF per cent on the gross earn
ings OF the roads. Under this act the stat
should be now receiving from the companies
aided at least three millions OF dollars every
year, besides the per cent on earnings. Tn ?
1alde Of the lands thus given away is almost
beyond computation. They We're covered with
MAGNIFICENT forests OF pine and hardwood and be-
Meath the surface there was untold mineral
wealth. Alternate sectionS " - given e tie
companies and the otheIs so,d t. actual settle
Every acre cleared by the pioneer and every
road built by him to enable him TO reach
market with his products enhanced the value
Of the railroad land. The settlers were not onl,
required TO build roads through their own sec
tiors. but through the railroads sections,
fact which added materially 70 the burdens
the home builders. Their children were com
PEELED. in many cases, to cross these unimprovc
sections for the purpose Of reaching The schools
The railroads were put In a position where the
got the advantage OF development when Cos
them nothing.
panles to pay / per cent on the cost OF tn road
has been violated from the first 50 that the stat
has never realized anything substantial from H.
In most Instances the land grants made 70 IN
companies have been separated from the own
ership OF the railroads and treated as prohts uy
the promoters In this way the state has been
left to deal with crippled and impoverishc' cor
porations while the generous gifts 10 a'd then
have passed into other hands. The land them
selves have in many cases been stripped Of thci
timber during the period OF their exemption IRON
taxation and have returned TO the state IN q
worthless condition for the non-payment OF SUI
sequent taxes.
government 10 the state TO aid In building tall-
roads immense tracts were given 10 cid In drain
ing and reclaiming the low lands Of the state.
As to these lands the state was simply trust
The trust should have been regarded as sacred
The governor cites several instances whore the
legislature has given away large tracts OF "a
lands to the railroads and showing that roau
have never fulfilled their part ot the contract
10 drain the lands etc, and have evaded taS,
on them I'm nearly every instance. The governor
These are only samples Of many TO be found
I'm our statute books during that ueriod of plum
der and spoliation. They followed each other H.
raJid succession until the generous CUTS OF t.
national government to the state had been ah-
sorted nv the railroad companies and untA IN
lands in the hands Of the railroad companie.
~ from ali ttXation. ludr
what pretense can the railroad companies OF this
state after having received these generous gttts,
ask to be exempted from their contract obliga-
tionsf How can any honest man now otgeGt 70
making the companies thus richly endowed by
the state pay ut least their share oil the PUBIC
burdens? They have already reapcd g9deh
harvest from these gifts. They have realize
enormous sums from the sale OF THINKER and IL
transportation TO market, ana from SAFE OF MN
eral lands and the transportation OF ores.
am aware that 1t Is claimed by the railroad
companies that their business Is SO deprcsse
and Michigan affords such poor field for ther
opera lions that they cannot afford TO contribut,
their share towards the necessary expenses o
the state. As to this excuse can only repeat
what / said in my message of May u, 1881: !
regard IL as n SANDER upon the commonwealth
TO say that Michigan Is not as favorably SIT
uated for railroad operations as any Of her sister
states. She has been considered unusually rich
I'm resources, and resources OF that character
which make business for railroads Michigan II
first in the production Of lumber; first In the
production Of salt; first In the production OF
copper first in the production OF iron; she is fai
above the average in the production OF wheat.
corn potatoes wool and fruit; she has an in
dustrious and thrifty population; she lies In
the path OF through commerce and certainly en-
Joys her full share of it,"
/ am aware too, of the suggestion made by
interested persons that railroads constitute pc
culiar kind OF property which should be treated
differently from the other property OF the state.
II is suggested that II taxes are raised the rates
charged for carrying freight and passengers
must also be raised. II this the case II
would afford no excuse for taxing railroad prop
erty at a lower rate than that which IL paid by
the owners Of other property. We have no right
10 tax the people large for the benefit OF those
who ship freight or ride upon railroads. This
kind OF an argument may be made by anyone
who wants a special privilege for himself.
The suggestion has been lndustrIUnsly circj-
lated that Michigan enjoys unusually low rail-
road rates The interstate commerce commission
groups Michigan. Indiana, Ohio, Pennsylvania
and New York together The average rate OF
freight in this group Is .O0J42 per ton per mile.
This was In 1895. The rate In Michigan for the