The Owosso times. (Owosso, Mich.) 1897-1926, 1906-04-06
Michigan Wins Victory In Famous
Railroad Tax Case.
MILLIONS NOW DUE STATE
Supreme Court Renders Decision
Against the Transportation co-por-
ationa-Justice Brewer Hands Down
the verdlct-MichIssn Has $4,000
GOO Due Her.

Washington, April 3.-The supreme
court of the United States Monday
decided the Michigan railroad tax
cases, involving the taxes Of all the
railroads in that state for several
years past, against the railroads. The
opinion was handed down by Justice
Brewer.
Justice Brewer accepted as final the
decision OF the Michigan court as to
the validity of the tax law under the
state constitution. He said:
There is no general supervision on
the part Of the nation over state tax
alton and in respect to the latter the
state has, speaking generally, the free
dom of a sovereign both as to objects
and methods"
Remarking upon the contention of
the railroad companies that the fixing
OF the rate Of taxation by the state
authorities as authorized by the state
law is legislative function, Justice
Brewer touched upon a point which
is now receiving much attention from
congress, and said:
"The statute prescribes as the rate
of taxation upon railroad property the
average rate of taxation on all other
property subject to ad valorem taxes.
II provides the most direct way for
ascertaining such average rate, de-
ducing it from a consideration of all
the other rates. No authority is given
to the local assessors to apply their
judgment to the question of the rail-
road rate. Their authority in respect
to the matter of taxation is precisely
the same as it was before and inde-
pendently of this statute.
"Why is it necessary that the legis-
lature be convened to add its formal
of the integrity of the action
of the local officers? Why not it en-
trust the mathematical computation to
the state board of assessors and if so
may it not likewise act upon the as
that the local assessors will
their duties with an eye to
those duties and irrespective of the
effect upon the railroad rate?"
In closing he said:
unless there be some specific pro-
visions in the state constitution COM
polling other action the state may
treat it's entire territory as composing
but a single taxing district and deal
with all property as within the dis.
trict and subject to taxation accord
ingly."
By this decision Michigan's primary
school interest fund will be swelled
by approximately $10,OO0,OOO, which
the railroads will have to pay forth.
with.
There were q of these cases. all
involving the validity of act No. 173
OF the Michigan legislature of 1901,
passed under authority given by an
amendment to the state constitution
adopted in 1900. This law changed
the method of taxing railroad and
kindred corporations fltpm the old
system of exacting the payment of a
certain per cent of their gross earn.
lpgs to an ad valorem system, pro-
viding for the fixing of the tax rate
If the railroads on the average rate
1t which other property in the state
S taxed.
The railroad companies have been
paying since 1902 on the old system,
to obey the new law which
hey have contested in the courts
without success Each year since the
companies have refused to pay the
Inference so that the suits involved |
n accumulation of about $780, 900 a
ear, with interest of one per cent per
month on that portion of the taxes |
lot paid over to the auditor-genecal.