The San Francisco call., 1899-07-04

fixing the rate of taxation for the main
tenance of the State.
There is one class of bonds, that of
railroads and other quasi public cor
porations, which caused some doubt IN
the minds of Mr.. Ford and Me. Abbott.
While personally they believe that such
are subject to taxation, stin there are
decisions by the Supreme Court which
leave the question open to doubt. The
opinion was given in response to the
following inquiry by Mr.. Brown:
The State Board of Equalization would
like your opinion as to what bonds are
assessable under the provisions of section
l, article XIII of the constitution of this
State. Specifically, the board wishes to
be advised as to the accessibility of bonds
of the State of California of the counties
and municipalities thereof, of the smaller
districts, such as school districts, therein,
the bonds Of railroad companies, such as
the Southern Pacific, the San Francisco
and San Joaquin Valley and other like
corporations, the bonds of the Market
Street Railway in San Francisco, the
Spring Valley Water Works Company,
gas and electric light companies and all
other private, quasi public and public cor
pOrations, except the bonds issued by the
Government of the United States under an
act OF congress, WnGn SuCn pOiluS are ueIu
by private persons and corporations
To this the States Attorneys answer:
In reply will state that the sovereign
power of the State to tax all property
within the State cannot be questioned.
The constitution OF this State, in arti-
Gle XIII, section /, has provided that all
property in this State, not exempt un-
der the laws of the United States. shall
be taxed in proportion to its value to
be ascertained as provided by law. and
enumerates money, credits, bonds,
stocks, dues, franchises, etc, as within
the meaning of the word property"
this section also provides for certain
exemptions.
The exemptions noted are young
orchards and vineyards, growing crops,
free Libraries, etc, and all stocks,
bonds, treasury notes and other obli
cations of the United States. AS to the
assessability of the bonds of the State
of California, it has been held that the
same are personal property within the
meaning of the revenue laws of this
State. Bonds of counties and munich
palities also have been held to be per
sonal property and likewise are liable
to taxation as such.
The assessa bility of bonds of railroad
companies, etc, proved a stickler for
the attorneys. Under the State consti-
tuition all property in this State, not
exempt under the laws of the United
States, shall be taxed, and the word
property as used in this article and
section Cart. XIII, Sec. u is hereby de-
clared to include moneys, credits,
bonds, stocks, dues, franchises and all
other matters and things, real, per-
sonal and mixed, capable of private
ownership"
Section 3617 of the Political Code
seems to exempt railroad bonds, for
it says:
Whenever the terms mentioned in
this section are employed in this act
they are employed in the sense herein
after affixed to them: First. The term
property includes moneys, credits,
bonds Except of railroad or quasi
public corporations), stocks, dues,
franchises and all other matters and
things, real, personal and mixed, cap
able of private ownership"
According to article XI. section 13,
of the State Constitution of 1863 there
does not seem to be any exemption.
In dealing with the proposition of as
sessing railroad bonds it would seem,
according to the opinion, that lawyers,
Legislature and court are at sea upon
the question. The Political Code ex-
empts these securities and this was
recognized by the Supreme Court in
the case of Mackay VS.. San Francisco,
wherein it was claimed that the taxa
ton of the bonds of railroad was lille
gal for the reason that the code ex-
pressly exempted them. Upon this the
opinion says:
The only possible objection that might
he urged against the taxing of the bonds
of railroads and other quasi public cor
nora tions is that II would be t'double tax
alton" and therefore prohibited by the
constitution and law of this State.
Were it not for the decisions of the Su-
preme Court of this State last above re-
ferred TO in relation TO double taxation,
should unhesitatingly say that the bonds
of railroads and other quasi public cor
porations are subject to taxation in the
same manner as is other personal prop
erty in this State. The precise question,
however has never been directly decided
by the Supreme Court of this State, and,
as you can readily see, the matter is not
wholly free from doubt. would there
fore advise that all bonds of this char
SCISSORS of the several counties, and If
such assessment be contested the matter
can then be speedily tested in the courts
and definitely settled. Very truly yours,
TREY l.. FORD, Attorney General.
BY WILLIAM Nj. ABBOTT,
Deputy Attorney General.
Bonds similar to those discussed by
the Attorney General are assessed in
other States, and Assessor Dodge be-
lieves they should be taxed in this
State. In speaking generally yesterday
of his assessment and it's meaning he
said:
II hope the taxpayers of this city will
see that the way to secure low taxes
and a low rate is honestly to return
their property to the Assessor. If this
were done dollar rate in few years
would be regarded as exorbtant as a
rate Of 81 81 is now. This city, unlike
auv other city in the United States of
over 100, 900 population, has no bonded
debt to provide a sinking fund for
through yearly taxation. Think of
Chicago, with 66 cents in each tax levy
FUND and interest on levy