The Red Cloud chief., 1902-08-15
The Distribution Of Railroad Value a Benefit to Outside Counties.
ISSUED UNDER AUIAMIY OF HE RAlR0AOS OF NEBRASKA

property has been virtually exempted from municipal
taxation. An Investigation of the matter VIII readily
show that this charge has no foundation in fact.
In pursuance of the requirements of law, the rail
road companies have each year submitted for the con-
sidcration of the Board, sworn statements or schedules
of their tangible property, setting forth in detail. Tie
mileage of main and side tracks in each county, the
number of depots, station houses, tool houses, stock
yards, etc, and complete lists of the rolling stock and
movable property on the right of way and depot
grounds. They have also made to the State Auditor,
statements under oath of the revenues of the conpan-
les, gross and net, their ca pitalization and the interest
paid on their bonded indebtedness:
The valuations reported in the property schedules
havebeen recently criticised, but the valuationsin such
valuations are easily explained by the fact that some
companies report what they believe to be tho proper
assessable value of the various items, in conformity
with the assessment of other property in the state,
while other companies approximate the actual value
Of the items, depending upon the board to FIX the
scale of uniformity.
The board has never relied upon the valuations re-
ported in the railroad schedules asa guide in fixing its
assessments,b but has al way - diligently soug hit the most
accurate sources of information within it, reach. Ithas
in some cases had before il the data showing actual
cost of construction Of the properties, and in others,
the carefully prepared estimates of expert engineers.
For several years past, the respective boards have had
access to and have considered the testimony in the
maximum rate cases, where the roads were not likely
to show dimunutive valuations.
In the case of the Union Pacific, the record shows
that the present ASSESSED valuation of its main line
represents more than Is per cent Of the cost Of repro
duction as given in the testimony in the Nebraska
rate case,' and az 10 per cent has been shown in
recent controversies to be amply sufficient for the
equaized valuation of the tangible property, the
additioeal IS per cent, or thereabouts, is either excess
assessment, or it may be said that this three 6fths
additional assessment may cover all possibilities of
intangible values that may pertain to the property az
"going concern its earning capacity, good will,
etc.
So in the same estimates or testimony relating to
the Union Pacific line from Kearney to the Wyoming
state line, which comprises over one-half of the mile
age across the state, the testimony shows that the
assessed valuation of $4,000 per mile through those
counties represents about 10 per cent. of all the tan
giblc property of the railroad on that section of the
line. 1t is, however, incorrect and misleading to state
that any single portion of the road either in Douglas
County or in Cheyenne or Kimball County is assessed
at $1,000 per mile.
This rate per mile, as entered on the tax lists,
represents merely the distributive share accruing TO
the county or municipality, of the entire valuation of
the whole road, which distributive share is explicitly
designated by the laws of the state as a ratable mile
age proportion Of the valuation of the entire line.
In this way the terminals in Omaha Except headquar-
ters, Shops and vacant terminal lands, which are
assessed locality are distributed and taxed in every
city, village and school district along the whole line
from the eastern to the western boundary of the state.
This method of apportionment is upheld by the
Supreme Court in a recent decision, relating to the
Rulo bridge, in the following language:
"What was the purpose of the legislature in re-
curing the right of way, roadbed and superstructuce
of a railway to be assessed as a unit? The common
sense view of the subject would seem to be that such
purpose was to enable the proper authorities to diSt,i-
6nte the arabs of taxation equitably among all the
municipal subdivisions through which a road may
pass, in the ratio which the number of miles within
such subdivision bears to the total number of miles of
road within the state, treating each mile as equal in
value to every other mile, and regardless of whence
came the power under which any particular portion
of the road is constructed. A railroad might have
vast terminals at one point, worth as much as the
remainder of the line, though ii extended through 4
dozen counties. The subdivision in which these ter
minals are located 10 not, under this law, permitted to
reap an advantage over other localities by reason of
the mere accident of location, but must share it's ad-
vantages with these others pro rata. That, evidently,
is the reason behind and under this legislation"
1t has been alleged that the outside counties have
been "buncoed' by this method of distribution. A
careful study and analysis of the foregoing statement
of facts and figures must convince the people of those
counties that this form of buncoing leaves little to be
desired except more of the same kind. -