The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-05-04
Special Franchises Are Not Real
Estate.

The Tribune, in an editorial published
on Saturday morning, takes issue with
The Sun on the question whether special
franchises are real estate or not, and
argues that the 3220 900, 900 declared to be
the value Of the special franchises should
be included in the assessed valuation
Of real estate of this city, and therefore,
should be used to enlarge the city's
borrowing capacity. The Tribune says:
is II no, more natural to construe the words
OF tho Constitution 10 per centum OF the assessed
value Of the real estate OF such county or city sub
ject TO taxation. as II appeared by the assessmen,
rolls Of said county or city, meaning to Include
whatever the tax law defines as real esta,e,-
The answer to this question Is: Call
ing horse COW, in an act of the Legis-
lature, does not transform the horse into
q COW, and when the State Constitution
uses the words " the real estate OF such
city subject to tardtion as il appeared By
the assessment rolls of said city it means
real property and tangible real property
only, as those words were used at the
time OF the adoption OF the State Con-
stitution, and prior to the fanoiful no.
menclature OF the Franchise Tax law.
Suppose, for instance, that the Legis-
lature should pass law declaring that
there should be but one assessment roll
of tho whole city, and that all personal
property should be included in the words
real estate Would such an act make
personal property real estate by the
mere force OF its enactment, and 80 relate
back to the Constitution as to enhance
the borrowing capacity of the city? The
guide is to be found in the language of
the Court OF Appeals. and no higher
authority can be cited than the words
OF Judge VANN. Judge vANN says:
The Legislature found property scattered
oil over the State worth nearly two hundred mil
lions Of dollars which was not taxed al ALL and had
never been taxed. This property consisted wholly
Of special franchises or privileges given by tho
STATE. mainly 10 corporations furnishing 10 the
public transportation. water. gh, and other neces-
aues or oonvsniences OF daily life. : The
n<p kind Of properly Vas termed real .,tate Just
as might hors been termed personal properly or
ns@'aI properly. sctihoui changing as nature. which
The new properly 10 real estate IN name
but not In reality. for IL Is a mere privilege TO do
something In public streets and places. not per.
nitted TO ctIssns generally"
Tho above citations from the unani-
nous opinion Of the Court Of Appeals are
conclusive. As the special franchises
arc real estate in name but not in reality,
they cannot be included in the words
the real estate of said city as used by
tho trainers Of the State Constitution
Of lsse, for the makers Of that Constitu-
ton could not have meant to include
in real estate this new kind Of property,
which the Court OF Appeals says might
have been termed personal property
or neutral property
1t matters not whether the value Of the
right to collect wharfage has been taxed
as real estate by this city heretofore or
not; precedent or error in administrative
officers cannot override the plain mean
ing Of the State Constitution.