Evening star. [volume] (Washington, D.C.) 1854-1972, 1904-04-15
PAYMENT DEMANDED
LOCAL RAILWAY COMPANY SAID
TO BE DELINQUENT.
Personal Taxes for 1908 Alleged to Be
$50, 335-The Company's
View of Matter.

Acting upon the recommendation of Hope
we'll H. Darneilie. the District assessor. and
an opinion of Corporation Counsel A Il.
Duvall, the Commissioners today. ordered
that the collector of taxes make written
demand upon the Washington Railway and
e Electric Company for the payment within
ten days of $3o.3S56l. the amount claimed
by the District TO be due from the company
for personal taxes against the Metropoli-
tan Railroad Company and the Columbia
Railway Company. branch lines Of the
Washington Railway and Electric Com
pany, for the year ending June 30. 1908.
The Commissioners also order that in de-
fault of such payment within the time men,
toned the collector of taxes shall proceed
to make levy upon the rolling stock ana
other tangible personal property OF the
Metropolitan and Columbia railroad COM
panes.
accidental to the action of the Commits
: sioners with respect to the metropolitan ana
-Columbla railway companies their approVai
of the assessors recommendations IN erect
directs the collector of taxes also to render
bills to each railroad company in the DIS
trict, with the exception of the two compa-
MES mentioned, for their FRANCHISE taxes Ior
the calendar years 1902 and 1903. The IRAN
chise taxes are based on the gross earnings
of the companies on which the railroads are
required to pay per cent per annum Inc
amount due the Ii dh-
chise tax against the various railroads, IL
is stated, amounts 10 considerably more
than 100000. -
In a communication submitted to the Dis
trict Commissioners the Washington Railway
and Electric Company claims that when the
Washington railway and Electric Company
acquired by purchase the properties ana
franchises of thu. Metropolitan and Column
~ railway companies, these companies
Is went out of existence. and the capital stock
OF the corporations mentioned ceased 10
have any value: that any estimates based
upon an assumption Oh value of the STOCKS
of the companies must be erroneous.
A Further Claim.
The Washington Railway and Electric
Company also claims that the requirement
contained in the act of April 1, 1902, pro-
viding that "street railroad companies
shall continue to pay the per cent per an
mum on their gross receipts and other taxes
as provided by existing law does not
apply to that portion of its road formerly
:. embraced in the Metropolitan and Column
f.. bia railway companies. because these COM
panies were required by their charters to
-~ pay on their capital stock.
~ This technicality." says Assessor OAR
nellie in his report sis mere bubble and
-. without sound foundation"
= The assessor states that the street rail-
way companies operating in the District
and required to pay a franchise tax of 4
per cent year on their gross earnings
fOlIOWS. Inc AndCOStld fOlo-
: mac River Railroad Company, Brightwood
Railway Company. Capital Traction Com
-spany. City and Suburban Railway Com
pany, Georgetown and Tenleytown Railway
Company Washington, Alexandra and
Mount Vernon Electric Railway Company.
OF the lines embraced in the Washington
Railway and Electric Company the Wash
ington and Great Falls Electric Company Is
required to pay franchise tax of per
cent a year, but the Metropolitan and Co
lumbia companies were required to pay I
personal tax based upon the assessed valua-
ton of their capital stock.
Summary of Assessors Report.
In summarizing his report Assessor OAR
nellie says:
each of the street railroad companies
in the District of Columbia Except those
portions of the Washington Railway and
Electric Company formerly embraced in
the Metropolitan and Columbia railway
companies) is by its charter required to
pay as franchise tax 4 per cent per
-tannum on it's grvss earnings.
The Metropolitan and Columbia railroad
companies were required by their charters
to pay for personal taxes 1i2 per cent per
annum on the appraised valuation of their
capital stock; and, for approximately the
past ten years. the stock of these roads
was SO assessed that the tax charged was
equivalent to per cent of their gross earn
ings. This method was approved by the
former owners of the roads and acquiesced
in by the present owners.
Because of the fact that the reports OF
the railroad companies of their gross earn
ings were made by calendar years, and that
this was not coincident with the tax year.
each street railroad company except the
Metropolitan and Columbia, Is in arrears
for the franchise taxes on its gross earn
ings for two years. the calendar years 1902
and 1903. In this category is included that
portion OF the Washington Railway and
Electric Company'S system formerly en-
braced n the Great Falls railroad.
The Act of 1902
THE act of July 1. 1902. provided that
all street railroad companies should CON
tinue to pay the per centum per annum
their gross receipts" 1t was the in
tention of Congress that this should be
construed to apply to all street railroad
companies, the impression having been given
the congressional committees that the
s Metropolitan and Columbia were paying
on their gross receipts. which, In fact, Was
the case. although to comply with the law
the taxes were apparently based on the
appraised valuation of their capital stock.
1T was clearly the intention of Con-
gress before the passage of the act of July
1. 1902. that each street railroad company.
except the Metropolitan and Columbia,
should pay for the privilege of operating
per centum per annum on every dollar
earned by it, and that the Metropolitan
and Columbia should pay an annual per-
sonal tax for every year they were in OPP
Grafton.
The present owners of the Washington
Railway and Electric Company. which, as
= Is understood. comprises the Great Falls,
the Metropolitan and Columbia, place
themselves on record as declining to pay
s any personal tax whatsoever for the Metro
politan and Columbia roads for the fiscal
year 1903
Il think it is perfectly apparent" says
MIR. Darneile that this is clear contra
vention OF the Intention of Congress and
an attempt to evade the Just obligations of
the roads. There Is also no doubt that
p each of the other roads. including the
Great Falls division OF the Washingto
Railway and Electric Company are in ar
rears for the franchise taxes upon their
gross earnings for the calendar years 1902
and 1908"
In view of these conclusions Mr.. Darneille
recommended the action taken by the Com
mssioners as indicated.
THE DISTRICT BILL.