River Falls journal. [volume] (River Falls, Pierce County, Wis.) 1872-2019, 1903-01-22
TO THE LEGISLATORS.
Gov. LaFollette's Second Inaugural
Message.
Deals with Important subjects--Fa-
vors Much Legislation Along Re-
form Lines That VIII Effect the
Railroads and the Trusts.

Gov. La FoIIettes' second inaugural mes
sage to the state legislature Is a lengthy
document Of more than 10000 words, the
greater part Of which is devoted TO thor
ough discussion Of the following subjects:
Condition Of the state finances; taxation,
including the taxation of railway property;
the control Of freight rates in Wisconsin;
nominations by direct vote Of the people,
combinations in restraint Of trade ana ed-
ucation The remainder Of the message y
given to consideration Of the various
state institutions and to recommendations
for general legislation
OF the states financial condition the gov
ernor says:
THE balance in the general fund OF the
state treasury on January !, 1903. was $780,
8S4.54 q sum sufficient to meet all current
expenses, Including those incident TO the
legislative session, until license ices ana
other considerable revenues OF the state
are again received. During the last two
years no transfer from the trust funds to
the general fund has been made for the
purpose Of meeting temporary denclts. me
state treasury has been able to keep the
trust funds fully and profitably invested as
the law contemplates should be done. In
order to maintain this desirable condition,
IT was found necessary by the executive to
delay the expenditure Of some eXtraordl-
nary appropriations during the year OF
1901, when legislative expenses were met,
year 1902"
The subject Of taxation is dealt with ex-
haustively, attention being called to the
enactment Of the law providing for tax
commission and the work Of the commls-
sion IS approved, though the last leSlsla-
ture Is criticised for not having adopted
the measures proposed by the commission
that would have resulted in leVying equlta-
bic taxation against the public-serVice cor
porations In this connection the governor
says:
with a unanimity not usual in any leg
fslatiYe body the bills designed TO secure
aunif0rm and more complete assessment OF
the property Of individuals and private cor
DoTatiOns were passed through both
branches Of the legislature, although the
bills designed to insure the pay meht Oh d
more Justly prOportiOnate share or the taxes
from railroad and other pubIic-serVice cor
porations were defeated in the assembly
late in the session, and were never reported
for action from the committee to winch
they were referred in the senate"
Of the efforts that he believes should be
made 30 assess and tax what he terms the
intangible property Of the state the gov
ernor says:
''With the rapid accumulation of wealth,
the increase in the amount and value of
intangible property but strengthens year
by year the reason and justice Of its tax
alton IN some form. That vast accumuIa-
lions Of wealth may be invested in inter-
est-bearing securities insuring large in
comes to the holders who throw their share
of the expense of maintaining streets and
schools and public institutions, and all the
burdens of municipal and state govern
ment upon the owners of factories and
shops and stores and farms and homes,
violates every principle Of equal rights and
equal responsibilities guaranteed to each
American citizen.
mo student of the subject, however is
unmindful Of the difficulties encountered in
the administration of laws to secure the
direct taxation of all intangible property.
While the subject is not new one, thor
ough-g going, scientific investigation of it
conjoned with practical test has still
wide field to explore.
with respect to mortgage taxation,
which ii is to be remembered represents
only a part of the vast amount of intan-
gible property subject to taxation, it Is not
so difficult to discover and secure the
sessment Of the property interest repre-
scented by the mortgage. This may easily
be done by assessing the mortgage as an
interest in realty, and providing that if the
tax levied thereon be not paid by the own
or Of the mortgage interest, it may be paid
by the owner Of the mortgaged property
and deducted from the amount of the mort
gage debt AS, no piece of taxable proper
ty should be taxed twice, wherever this
plan is proposed it Is agreed that the owner
l0OTJRdRGu
the valuation of the assessment upon his
mortgaged premises reduced at the time
of the assessment, by deducting from the
value thereof the amount of the mortgage
thereon"
In referring to the increase of the mill
tax, the law for which was enacted in 1885,
for public school purposes, and recon-
mending a change in it's operation, the gov
ernor says:
This law, which has been in force for
nearly 20 years. has annually produced for
the benefit of the common schools a
state tax of about 100000 The state board
Of assessment following the commands of
the statute, fixed the value of the taxable
property of the state ut its full value, in
creasing it from $500 OC0 600 in 1900 to ST. 1885,
2S40gO in 1901 and to 81 ,504 GAG, 600 in 1902 in
creasing the state mill tax from $500. 900 in
1900 to $1456,2S4 in 1901, and to 81, 5O4, S46 in
1902.
This is an average increase for the last
two years amounting to $S40,315. Under
this law the older and richer counties of the
state contributed to those counties with
4 relatively larger number of children of
school age and taxable property of less
value. This Is in a measure justified be-
cause of the general interest which all citi-
zens have in maintaining a we'll developed
and well balanced school system through
out the state. / am advised, however, by
the tax commission that the amount raised
under the mill tax levy, together with the
corresponding tax levied by the county
board upon the towns, produced such a
sum of money in the aggregate when APP
portioned to the different school districts
as to render it quite unnecessary to levy
any school district tax in order to main
tain the school. Indeed, in some instances
the district school was maintained without
the levy of any local tax and a surplus left
over in the district treasury.
"It could never have been the purpose of
the legislature to raise so large an amount
by such a tax and relieve the school district
from any taxation. 1t is manifest that the
continued operation of such law would
tend to diminish local interest in the COM
mon school, and be prejudicial rather than
helpful. 1t violates the principle that the
expenses of local government should be
borne largely by local taxation as neces-
sary check upon reckless and eXtraVagant
expenditures.
Il recommend that seiate bill go limiting
the amount which can be collected under
the mill tax law to $3.50, coo, be enacted into
law, and l commend to your examination
the strong presentation of this entire sub
ject in the report of the tax commission
which doubtless will soon be placed before
you"
He recommends the passing of an inheri-
tance tax law along the lines suggested by
the tax commission, and such as Will stand
the test of the courts
The governor reviews the efforts MADE to
impose upon the railroads of the state their
lust share of taxation, which resulted in
1899 in the passage of the act creating the
tax commission, and reviews the work of
that commission in their attempt to arrive
at an equitable basis fer railroad taxation
and says: