Omaha daily bee., 1902-07-19

cuualizing. his board acted unfairly or dis
honestly. All that is said is that they did
not consider the franchises which we're OF
a particular value. Therefore, there is
no allegation here that they did not con-
slider the fair relative value Of all railroad
property, and with that element out of the
way there is no fraud charged In this case.
There is nothing perhaps In modern days
more complex for the PURPOSE Of taxation
than railroad property. l presume the
trainers OF our constitution and Of the con-
stitutions OF every state, were we'll advised
Of that fact. Railroads OF modern times
are no longer confined to one particular
state. but are made up Of great trunk lines
which penetrate dozens Of states, and the
difficulty OF taxing these railroads fairly
has been considered by the legislatures Of
every state, by the great economists Of
modern times, and the difficulties are still
considered insuperable- Perhaps It was with
that view Of the case that the legislature
in enacting this particular section said
You must assess and you are required to
assess all the property of the railroad in
Guiding the franchise, but re leave to you
the formula by which that shall be accom-
plished, that is for you"
Now II this board has reached a fair and
satisfactory conclusion upon the thing com
mjtted to its charge to be done, 1t is not
for this court to review its action. II
1t has fairly responded to the requirements
of this act, then its act is conclusive, and
its judgment final unless reviewed in the
manner pointed out by statute.
The counsel for the relator insist that
the proper methods by which to admeasure
the valuation Of railroads is by a considera-
tion of their stocks and bonds. For this
reason I have given some consideration to
the stock and bond quotations or values of
the Chicago, Burlington & Quincy Railroad
company, which operates a railroad in this
state. l believe from a consideration or
inspection Of its annual report, that In
1901 1t operated S,374 miles. understand
that since that report was issued 1t has
added several hundreds of miles to that,
at least that is the information which l OBJ
tanned by application to our auditor for
that purpose. This report, which the re-
lators have introduced In evidence, shows
on page 22 the cost Of the road and equip
ments. On the same page are made deduc-
lions for stocks and securities held by this
company issued by other railroads. Now,
assuming that the mileage Of this road is
1914 miles and hat the cost OF the road
is $2SS, 900. 900, the cost per mile on the
basis Of the number Of miles that 1 have
given would be $s6, 63s-that would be for
the entire system traversing the eleven
states, made UP Of the expensive terminals
in st. Louis, Kansas City, st. Paul, Mime
apolis, Chicago and elsewhere. That is
the entire railroad from its beginning point
to its ending point, and It only shows $780,
600 a mile. II you take the capital stock
at Sic. SIT, 700 and multiply It by 2, because
| thav saw fhfa afnnH oold IN thn Yaorl,n4 g.
! 5000 a share, you get the sum Of 1921, 1856,
400, and II you add to that the total bonded
debt Of about Sill, 900, 000, which is the total
bonded debt less the bonds held as repre-
senting other roads. you get about $34, O0C
per mile when you divide by the number OF
miles that I have given. So that by any
theory that you may formulate, the assess
ment of the Chicago, Burlington & Quincy
railroad In this state, $4,000 a mile is an
absolutely excessive assessment as CON-
pared with the assessment Of other property
In this state.
/ have prepared here a number Of tables
on this proposition and I read from SEIZED.
ule A. You take the funded debt at Sat.
O0o, 900 and the capital stock at par value
$780, 00. 900, and the total would be $751;.
0 $1,000. Their you divide the total by thu
total number of miles, and you get 9
valuation per mile OF $40, 900. II YOU
take schedule B., and lake the stock a
1892 per share (for 1t is a fact, as = I'm.
de%rstand, that the great bulk Of this stool
sold for 1892 per share, and only a small
part sold for 5000, you call 1t S192
share. Then you get for stock $212, 900, 900
and you get the funded debt at S147, 900, 900
and If you divide that by the mileag,
above, on that basis you get a little NOR,
than $40. 900 a mile.
Now, your honors. there has been an ap,
peal made here for the method OF de,
termining this value by the market quota
tions. The average value Of the Chicago
Burlington & Quincy stock for the clever
years last past was a little over $40.
a share. This is shown by the table which
Is found in the brief, and which is correct
and shows the highest and lowest quota
lions for each of those years. How d.
you propose to get at the industrial wortl
Of the stock by using the market quota
tions? Suppose that on March 1 OF an.
year the market quotation of stock is be
low par; on the 18th, par; on the 25th
s25 above par: on the S0th, par; on tn
day the board fixes the value. below o
above par; is II going to use the quota
ton Of those days II p~erchance 1t is be
low par, or will It rather ascertain tn
true industrial worth of the property It
self? My insistence is that you canno
get at the value by a consideration Of tn
market value of stocks and bonds.
After the Goggin case had been decide
by the supreme court OF Illinois-some tw
months after-the assessing board of thu
state, which had power to assess the rail
roads, met and, in response to that decis
ion equalized and assessed the railroa
properties, and the result Of that considers
tion has been introduced in evidence in tn
case, and that board after applying til
rules and principles set forth in that d.
cision, actually reduced the assessment G
compared with the previous assessment
the previous year. That was the assess
ment of the railroads In Illinois. The Oh.
cago, Burlington & Quincy railroad, l thin
was assessed at a little less than $4,000
mile. including. Of course, Its expensiN
, terminals in Cook county. The Chicag
Burlington & Northern Railroad compan.
which is a proprietary line Of the Chicag
Burlington & Quincy. was assessed. l thin
at less than $1,000 a mile, and the assesi
ment there was on a 20 per cent basis
the railroad. II 1t is valued on a 20 p'
|, cent basis. then the value OF that railros
in Illinois was s42, 900 or 5000 a mil
/. Now, speaking about the value OF railroad
: the Kansas City & Omaha line was puI
chased not long ago by the Chicago, Blu
~lington q Quincy Railroad company. 1t ge
, ting something like 200 miles Of road
J thIa state and the Durchase Drice was som,