The Bourbon news., 1899-03-21
Which Is the Better Policy?

with the largest wholesale and manu-
featuring business outside of Louisville,
has compromised the franchise taxes on
all it's corporations at the uniform rate
Of fifty cents on the dollar. This in
cludes the street railway, banks,
electric companies and all other corpo-
rations of semi-public nature.
The compromise is the adoption OF no
new policy with Paducah. The citizens
recognized long ago that the arbitrary
requirement Of the new Constitution
were incompatible with their business
interests, for capital could not be at
tracted to city where the pound of
flesh, nominated in the bond was to be
exacted. The banks had contracts,
agreements with the State, whereby in
consideration of the REIMBURSEMENT of
certain old chartered rights they acceded
to an increase of 90 per cent. in their
taxation, and were guaranteed contin-
uance of that rate. The new Consti-
! tuition apparently overrode this agree
ment, and demanded the ad valorem
assessment of bank capital and all other
property. Here was a serious dilemma.
The banks had undoubtedly a cause of
action, both in law and in equity, and
| it was plain that not only must long
and expensive litigation result should
there be an attempt to enforce the ad
&c 90 IY1f
was also the reasonable certainty that
capital would be driven away, thereby
contracting business and restricting en-
ployment. Under these circumstances
the citizens of Paducah cut.the Gordian
knot by straight, square-out compro-
mise that provided a largely in
creased revenue for the city, while, at
the same time, it conceded literally to
the fact that if the hanks had ma de
hard bargain under the Hewitt law it
was bargain, nevertheless, that had been
fully sanctioned by the State authorities.
Then, as it would not be right to treat
one set of corporations one way and an
other in a different fashion, and as the
same reasons against excessive taxation
held with them, they were given the
same terms. All were treated alike; all
placed upon a common level.
How different the case in another |
busy city in the famous ''Pennyrile''
section--a city with much the same nat !
ural advantages as Paducah. In Hop |
kinsville there is bank that has had
capitalization of $3.50, 1000, which is very
large for a town Of that size. This |
bank, like others in the State, applied |
refused. Negotiations dragged along, !
and, finally, as we understand it, the |
City Council absolutely refused to COZ i
slider a compromise, insisting that the |
full amount of the taxes be paid. The |
result was that last week the Bank of |
Hopkinsville filed articles in the Office |
of the Secretary Of State, reducing it's |
capital stock from $3.50, 900 TO 800, 900, |
Oh which it will hereafter be assessed. |
The othsr $150,0O0 will probably be so
invested in bonds that it will escape the |
Assessor and will contribute nothing to
its share of the public burdens At the
same time the banking capital of Hop
kincville being thus contracted and tax |
alton on what remains being higher, the |
rate of interest will be increased and
borrowers will have to pay the penalty
of Hopkinsville's severe policy. |
The action of the Bank of hopkins |
vile has been in line with that of many
banks OF Louisville, Lexington, Dan
vile, Covington, Newport, Middlesbor-
Ough and every other town and city in |
the State. An instance in point: In |
Glasgow is an old and weIl-estaolished |
private bank managed with skill and |
conservatism that have been of great |
benefit to the business development of |
Barren county and that section, while |
at the same time the owner has &C
cumulated fortune This bank had a
capital Of $4,000 and surplus of $20,-
0O0-total, 100000 When it became |
evident that the ad valOrem rate OF taxa
tion would be insisted upon the head of |
the bank made what bargain adver- |
tisements would term "a sweeping re- |
ductIon" of capital, and is now paying |
taxes on $4,000 instead Of $780, His |
policy was the same as that which has |
taken many millions of dollars out of |
the banks and other corporations in this
State and may result in driving out |
millions more
The Paducah policy has been salts
factory to the citizens Of the beautiful |
and prosperous capital of the "Pur-
chase" The policy pursued elsewhere |
has antagonized enterprise and capital, |
and business and labor have had to |
suffer, while In the aggregate the rev.
enues of the State have been greatly |
reduced. Which is the better?
-TErOfn tho Hnuo.'e or Ioa,rn17