Gloucester County Democrat. (Woodbury, N.J.) 1878-1932, 1906-01-11

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The taxpayer Iii the municipalities has
sum contributed II be derives no benefit
therefrom in reduced tax bills. Our boast
Cd system Of corporate taxation fails II it
constitutes only an increased fund for
the tax spender and affords no dividends
to the taxpayer There are 50 taxing dis
tricts IN the state with tax rates between
Sc and So rs, SO with rates between 81 Is and
$3.50, SO with rates between $3.50 and IS. 70
with rates between 50 and $3.50 and 8 with
rates above $3.50. AS l said in my In
augural, the expenditures in twenty-six
cities in this state increased in ten years
70 per cent, while the valuations increased
only 40 per cent. SO that such tax rates as
these, IL valuations are honest and the
listing of ratables complete. mean confis-
cation II property. They must be capable
of reduction with greater economy and
wiser business methods In municipal af
fairs. Otherwise we are forced to the
confession that confiscation of property
is necessary to raise the money to carry
ON our municipal governments. That
economy Is possible is shown In the case
OF Hunterdon county. A change in the
method of management of county affairs
from that of a board Of freeholders to a
more compact board of county commits
sioners has in one year resulted in re-
duction Of $4,000 in county expenditures.
II reduction in expenses has been sue
cessful1y accomplished in one place it Is
worthy Of effort in others.
Taxation Of Main Stem.
The last legislature passed an act pro-
yfding that second class railroad property
should be taxed at local rates and that
the revenue from this source should as
Heretofore be turned into the treasures
Of the municipalities where such property
is situate. This law increased by $4S5,00a
the amount of taxes annually to be paid
by the railroads. The same legislature, in
pursuance of the policy inaugurated two
years ago, referred to the state board OF
equalization of taxes under joint reso.
luton, '.the further consideration of the
taxation of railroad property" This re.
ferred to the main stem, or right of way.
which is confined to strip not exceeding
100 feet in width and in some cases moi
exceeding sixty-six feet in width. The
main stem is thus the railroad highway
of limited width traversing the state. The
board of equalization has made recon-
mendation upon this class of railroad
property, and that recommendation is be-
fore you in separate report 1t pro-
vides, in brief, for the taxation OF this
class of railroad property as other prop
erty at the average tax rate of the state.
Railroads should pay the same proper.
ton of taxes as is paid by other property;
no more, no less. AS Governor Albeit
said, Equal burdens and equal rights for
ALL corporations as well as individuals,
are the principles that should control our
tax legislation In order to produce this
equality not only the rate. but valuation,
must be weighed One class of property
may pay the same rate as another, but II
1t is subject to a lower or higher valua-
ton the principles of equal taxation are
violated.
There are two distinct methods by which
this class 81 property may be taxed-one
by taxing it locally, the other by taxing
1t by the state.
Taxation by Local Assessors.
The taxation of the main stem by local
assessors involves the cutting up Of this
class of property into sections, contermi-
nous with the boundaries of the taxing
districts through which it passes This
would destroy for purposes of taxation
the value which it derives by virtue OF
its continuity from terminal to terminal
and would result in a corresponding loss
in revenue. AS / said in my inaugural:
property OF this kind is valued as
whole. Divide it and yon destroy it,
One mile of the main stem of a railroad
is as valuable as any other mile for the
purpose for which it is designed, and yet
under system of local assessments one
mile of railroad would be valued at one
rate, another at another. One mile, for
example, might be valued at $4,000, an
other at 25,0O0 another at $4,000 The
mere statement of this fact shows the
possible inequality of such scheme.
Taxation by the State.
The main stem is class of property
particularly fitted to be set aside for tax
alton by the state. 1t belongs to no one
J,,r% 1c1a In
various counties and municipalities of the
state. Its patronage is derived not from
one section, but from all sections Of the
state, and the interstate traffic, which
adds greatly to the value of our railroad
highways, cannot be claimed by any one
section, but by all sections Of the state.
The revenues out of which the taxes are
paid are either contributed by the people
OF the state or derived from a source in
which they can all claim equal right. In
deed, the authority of the railroad to do
business is granted by the legislature
representing all sections of the state
Equitable considerations therefore would
seem to regard this class of property as
a source Of revenue for all the people of
the commonwealth. If the main stem
should be taxed in this way the applica-
ton to this property Of the average tax
rate of the state would seem to be logical
of equal taxation.
The average tax rate OF this state Is
about per cent The main stem, includ-
ing franchises which are figured in the
value of the main stem, together with the
personal property, produces a revenue to
the state OF a little over 1851, 200. II the
average rate of the state were applied
this class Of property, instead Of paying
$951, 900, would pay, subject to equalization
Of valuation about 50, 100000 within $500,
600 Of the present total state income from
all sources. The railroads now pay taxes
OF over $l,140000 a year, which is turned
directly over to the municipalities, SO that
this would make the total taxes paid by
for all purposes about 81, 100000,
or nearly Is per cent of the total taxes
now paid by all the property Of the state
Methods Of Distribution.
The distribution of the tax derived from
the main stem is a separate and distinct
from the method of taxation.
The state might retain a portion of the
tax and distribute the balance to the mu-
through which the main stem
passes, according to the proportion of the
main stem lying within each municipal.
ty This tax might be devoted to the