The daily morning journal and courier., 1898-11-23

reasonable, then recourse must De nau to some other method, and in determin- ing what that method should be the true meaning of the word value" should be borne In mind, Webster de- fines it as the property or aggregate properties of thing by which it is rem dered useful or desirable.
 What is the value of railroad? Is it what it cost to build? Yes, but not wholly, for the road would not possess value according to the definition if it did not earn enough to give some worth to it's cost; it may be urged that value may attach to it by reason of it's loca- tion in competition with another line, to which answer might be made that it's value then becomes what the other line is willing to pay for it to eliminate | 1t as a competitor. But the fact re- mains that the amount of money 1t is | able to earn determines in a measure, at least, its value.
 Which, then, shall be the determining factor, the gross or the net earnings? We all know that gross earnings result from the peculiarities of the road itself which very materially affect their re- lating to the cost of operation and thereby to the net earnings,
 One road by reason of it's location through a succession of thiclkly settled communities has insured to it heavy and steady local business, while an other traversing a sparsely settled country can never secure enough local business for sslf-sustenance and must, of necessity be dependent upon through traffic transported at ruling competitive rates, or it may be at even less rates
 Where these rates, as it oftentimes happens, are so low as to preclude the | possibility, even with the most eco- nomical and efficient administration, of netting little beyond the cost of opera tion it can readily be seen that gross i earnings as a determining factor are neither safe nor equitable. It would seem, therefore, that the test of value must be the earnings that remain after the operating expenses, taxes and rentals are paid. This re- mainder will be what is left for income on the bonds and stock which, presum- ably, represent the money that was ex- pended for the construction and equip ment, or, in other words, the cost of the road.
 Gauged, then, by the net earnings, l erating expenses, taxes and rentals, let of the New York, New Haven and Hartford railroad, Valley and Housa- tonic railroads.
 The net earnings of the New York New Haven and Hartford railroad for the fiscal year ending June 30, 1898 were $4972, ,771.55.
 The mileage was 415.93.
 The net earnings per mile (s4,972, ,771- 55 divided by 415.93) were $11, ,95579.
 The net earnings of the Valley road the last year when it was operated as a separate corporation QSS6), which is certainly the most favorable to it, were $37, ,320.S9
 The mileage waa 46.20,
 The net earnings per mic ($37, ,320. .S9 divided by 46.20) were $SO7.S1.
 The per cent. of Valley net earnings per mile to New York, New Haven and Hartford net earnings per mile is 6.S The net earnings of the Housatonic road the last year when it was operated as separate corporation QS92), which is certainly the most favorable to it, were s215,535.05.
 The mileage was 9012
 The net earnings per mile (s215 535 05, divided by 90.12) were $2,39164.
 The per cent. of Housatonic net earn ings per mile to New York, New Haven and Hartford net earnings per mile is 20.
 The value of the Shepaug road, fig ures on the same bases, is:
 (Valuation according to statute) Six thousand shares, say at 175, $1,- 05O, ,000
 Mileage, 32.2S.
 Valuation per mile, $32,527SS.
 Per cent. of Shepaug to trunk road 9.3.
 Net earnings:
 Net earnings year ending June 30 1892 probably the most favorable, $612343.
 Net earnings per mile, $1S969.
 Per cent of Shepaug to trunk road 1.5.
 Considered, therefore, from tht standpoint of actual cost or earning ca. pacity, every one of these branch lines must be found by this board to be oi less yaIue ner mile than onefourth of the average value per mile of the trunk road.
 This fact cannot be disputed, and having been eSCaDllSneQ, SeCIlOn 3Szl Ol the statutes compels this board to rec ognize it and estimate every sucf branch at it's true and just value" fol purposes of taxation
 This is all we ask at the hands of the board, and upon this we must insist We have made this claim after full de liberation and careful examination oI the law and facts involved and believe that our claim is both legally and nor. ally just.
 What the result may be in the calcu. lation of our taxes is not a matter ot the slightest consequence in this con sideration. The question is one of prin ciple first and figures afterwards. Set tie the principle and let the figures talk, care Of themselves.
 Our claim is either legally right ant can be maintained in the courts, where we certainly must seek justice if refus. ed it here, or it is legally wrong ant cannot be maintained anywhere I am confident that upon a thorough examination of the questions involved you will very quickly arrive at the con. clusion that both justice and equity re- quire you to sustain our claim as to the taxation of these branch lines.
 Respectfully submitted,
 JOHN M. HALL, For New York New Haven and Hart