The Yale expositor. (Yale, St. Clair County, Mich.) 1894-current, 1898-04-01
STRIKES THEM HARD.
GOV. PINGREE'S MESSAGE TO
THE LEGISLATURE.
Accuses Railroads of Evading Taxation
and Says the Legislature Helped EN-
do IL After Giving Them Big Land
Grants-After Other Corporations, too

GERS chosen at the last regular session at
their places. The desks of the late Rep
resentatives Lee and Rowley, in the House
are draped in mourxing and decorated
with flowers. Assistant Sergeant-at-Arms
VIM. Stocking was chosen TO fill the va
cancy of Sergeant-at-Arms Gibson. All
of the Representatives were In their
places except Edgar. Colvin, Oberdorffer
Peck, Tefft Vought and Williams. Col
vim came In later. All OF the Senators
were present at roll-call, except Covell
In the Senate protests were made against
the seating of Senators Covel and Pres
ton, because they are now federal office
holders and against Senator Hughes, be-
cause he has moved out of his district.
The protests were referred to a committee
Of five. Sergeant-at-Arms Armstrong
rendered his resignation, and First Assist
ant Sergeant-at-Arms Nose Parshelsky,
OF Detroit, was promoted to fill the va
cancy. Three stenographers, representing
the governor, were granted space on the
floor of the Senate during the session.
The two Houses met in joint session
and heard the reading Of the governors
message with close attention.
Gov. Pingree's message to the joint session OF
the state legislature assembled in eXtra session
first quotes his proclamation calling for the eX-
ira session. and then continues, in substance. as
follows:
You are called upon to consider the question OF
taxing railroad companies. express companies.
telephone companies and telegraph companies
and for no other purpose l deem the occasion
an extraordinary one. The inequality or our
system of taxation IS great that it should not
be permitted to continue for another year. i
have therefore called you together IN extraordl-
nary session to consider IL and TO provide proper
remedies. l regret the Inconvenience and eX-
pense OF such session. have called II because
j deemed IL the most practical way Of obtaining
reforms TO which the people CT the state are ell
titled. When convened In extra session the
Legislature is enabled to give the subjects sub
mitted careful. and deliberate consideration which
cannot be expected at a general session.
No one can read the constitution OF Michigan
without coming TO the CONCLUSION that lIs ram,
ers intended that all taxes 10 be levied should
be based upon the cash value Of the properly.
While IT permits the Legislature to provide for
the collection Of specific taxes under the laws as
they then existed. and to collect specific
taxes from corporations thereafter TO be organ
lied, II expressly requires that all assessments
thereafter authorized shall be upon property at
Its value. This provision OF the constitution
applies as well to specific and to general taxes.
Its continued violation since 1871 has led to
many evils. At the time the constitution was
adopted specific taxes. except upon values, were
unknown 10 the legislation OF the state.
Taxes are defined 10 be burdens CT charges i'm
posed by the legislative i6Scr upon persons or
property to raise money for public purposes The
power to tax rests upon necessity and Is inner
government can exist without II. and no arbl-
trary government, without regular and steady
taxation. could be anything but an oppressive
and yeXatious despotism. since the only a.terna-
tive Of taxation would be forced extortion FOR
the needs OF government from such persons OF
opJec.g the men in power might select as
Victims Cooley on constitutional Limitations,
page 419)
-. E5;crnor then quotes chief Justice Mar
shall this point and the" continues. the
first essential OF just taxation Is that 1t shall
be equal. To exempt one person from taxation
isSto rob another. To provide low rate Tor one
and high rate for another Is deSpotlc. In my
message OF January @. 1897. / called your et-
tention to this subject and suggested that
board should be appointed which should deter
mine the exact value Of all corporate property
not now taxed locally and levy taxes thereon in
the same proportion as private property now
bears, In my message OF May O, 1897, again
called your attention to the subject and ex-
pressed the hope that you might devise some
means Of eq',a,'-iug, IN a measure at least, the
burdens Of taxation
At your last session an act was passed increas-
ing TO some extent the taxes now levied upon
the earnings Of railroad companies. II was as
serted that this act would bring into the treas
ury between two and three hundred thousand
dollars. No taxes have yet been collected under
st. hut from the most reliable estimates that can
now be made Il viii yield only about one hundred
thousand dollars. The Michigan Central and
Lake Shore & Michigan Southern companies. TIE
two most wealthy and powerful companies in the
state claim that the bill does not apply to
them. They assert that they are protected II I
II by their special charters IL Is more than IKE
~ that the act will lead to serious and pro-
longed litigation. II the contention OF the com
panies should be sustained the result viii be
that as between the railroads themselves the ad-
ditiunal taxes proposed by the act OF the last
session will fall upon the companies least able
The system OF taxing earnings is wrong IN
principle and unsatisfactory in results and
places the state absolutely at the mercy OF the
railroad company. 1t Is compelled to take such
reports as are made to 1t. The privilege OF ex-
aiming the books of the company Is a useless
one. The work would be almost endless, and
even IL well DONE uncertain In its results. do
not wish TO charge fraud upon any OF the COM
panies doing business In this state. What In
sist upon Is that the state should never be at the
mercy of any taxpayer. and that a system so
open TO frauds should never have been adopted,
and having been adopted should be abandoned
at the earliest possible moment for one under
which the ostensible property Of the company can
be fairly and honestly taxed.
Railroad companies in this state are not bear
Ing their just proportion Of taxes. For the pur-
pose OF illustration l desire to call your atten-
tion to the official figures OF 1885, which are not
materially different from those of the present
year, and which, having been acted upon are
more certain for the purpose OF computation. The
In 1895, equalized by the boards Of supervis-
ors, was Ss1S 0SG 100 The vOard OF review. act
ms under section 1889 of Howel's statutes, fixed
the average rate OF taxes for state, county and
municipal purposes, at OPS The total cost OF
railroad property in the state. as returned by
the companies and verified by the afiidavits OK
their officers Tor the same year. was S3Ol'VO3, :
las ~. III the companies had been assessed upoli
this sworn valuation their taxes for that year,
at the average rate, would have amounted 10
IS 42S 0SS 10. The taxes which they paid were
Sal HOS a. Their tax amounted TO a little less
than one-Quarter OF l per cent upon their own
sworn valuation. Ii was less than one eleventh
OF the percentage paid by other taxpayers of the
state. The average rate OF taxation, fixed by
the beard OF review for the year 1891 is reported
20 me as per cent. The taxes to be paid by
the railroads do not materially differ from those
collected In 1895.
we are confronted with this situation: The
ordinary taxpayers of the state are bearing an
annual burden OF per cent upon the value of
heir property. The railroad companies are pay
ing less than one-quarter OF per cent upon
Nhalr md laaa han af
The proportion borne by others. One set OF tax
payers are bearing an excessive share OF the pub
lie burdens. Another set OF taxpayers are al
most exempted from any share.
The system of specific taxes, when applied 10
only a part OF the property of the state. cannot
be continued for any great length OF time with
out producing great injustice. 1t VIII be readily
seen that &c all the property OF the state to
be taxed specifically and at n fixed rate deter
mined upon in advance II would be impossible
90 meet any OF the emergencies which from time
TO time arise. IT, for instance. in 1916. the leg
islature had fixed three-quarters % 1 per cent
as the taxes which should be paid by all tax
payers as Il did fix the taxes to be paid by the
chartered railroad companies there would have
been no way TO provide for the increase OF taxes
which has since occurred.
Under the special charters specific taxes were
Raced in 1916 at three-quarters OF 1 per cent
upon the capital stock paid in and such moneys
as were realized from ,oans used I'm the construc-
ton OF railroads. This rate OF taxation was
made 20 commence in 1851. IL will be noticed
while this rate fixed a specific tax 10