The Washington times., 1906-05-23
CONTINUED from First Page.)

computation. the street railways are
now paying on two-thirds the amount
for which they concede the lines can be
reproduced. about the same rate that
the private citizen is paying. This cal
eulation is made without any reference
whatever to the valGe OF the franchises
that are being enjoyed by the COM
panies.
IF we apply to them the rule that
prevails here Of levying a tax upon two
thirds OF the value OF the property these
coroorations, under a IA per cent levy.
wou,1 pay approximately $4,000 a year.
Should this bill become q law. they
would pay $SS5.o0o, which is Su5,0o0 less
than under the private individual rate.
There is clause in the proposed sec
ton OF the bill relating TO taxation
which directs the proper officials Of the
District TO make an appraisement OF
these properties as a basis for future
taxation If such appraisement were
10 fix the valuation OF the street rail-
way properties at 81. go. .000-the amount
for which the management say they
can be experimentation they are paying
little more than l per cent under ex-
listing law. as against ~ per cent paid
by the private citizen. II the assessed
valuation were fixed by such proposed
appraisement at two-thiTds OF their
total capitalization. they would pay. un-
der existing law. $40 OF / per cent. II
based upon the total capitalization Of
$8l.0Oo.oOo. the rate would be e-lO OF l
per cent.
Some idea OF the value Of these fran
chises may be had when IL is understood
that I'm the case Of the Capital Traction
market at from SI44 20 $50 per share.
the par value being 800 per share The
Washington Railway and Electric Com
Dany preferred stock Is selling az about
go per share. and the cOmomn at $40 per
share.
Last year the companies paid S2.Os7.-
se0 dividends and interest on nearly $50
100000 OF stocks and bonds.
Question Of Just Compensation.
These facts impressed the committee
with the necessity OF making some in
quiry into the question OF whether this
Is Just compensation within the fun
meaning OF the term Has a public ser
vice corporation a just right to exact,
and should Congress allow. so great a
return upon an inflated capitalization.
and, II so, should II be relieved from
the payment Of q proportionate sum IN
the way Of taxes?
There is no present COMPLAINT against
the rates OF fare which these companies
are authorized 20 charge. but the great
disparity between the physical value
OF the property and the amount upon
which profits are being derived argue
strongly in favor Of increased taxation
The committee therefore recommends,
IN addition 10 the tax upon the gross
earnings OF pUblic-service corporations
In the District OF Columbia. a tax Of i
per cent upon their net earnings This
VIII bring The taxes OF these corpora
uons up 10 a figure nearly equal 20 the
tax rate that Is being paid by the
Pirate citizen II would also esta blish
hCre n tax system unCer which those
corpora tiOns would pay according 70
their ability FOR the valuable franchises
they now en1ov. 1t would at the same
time be in the Interest OF those concerns
which thus far have been unable to
lated railway lines OF the Washington
Railway and Electric Company, which
are used as feeders for the parent COM
pany and are instrumental IN swelling
its net receipts.