Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1907-01-25
SENATOR LEES REPORT TO THE
COUNTY COMMISSIONERS.

SENATOR LEES REPORT TO THE
COUNTY COMMISSIONERS.
To the Honorable Board Of County Com.
missioners for Montgomery County, Md.
Gentlemen You authorized me on Tues.
day last to communicate with Honorable
Buchanan Schley, State Tax Commissioner,
on the subject Of the assessment of corpora
lions and the exemptions secured by them
by making Investments 10 Baltimore City
stock. Inclosed is copy Of the letter sent him,
which briefly states my opinion on certain
phases Of the matter affecting this county.
No reply has as yet been received from Col
onel Schley to this letter, which was mailed
to him on the 18th Of January in duplicate
form TO Annapolis and Hagerstown.
In view Of the present high rate of taxes
in this county and the condition Of the
schools and roads and other proper objects
Of county expenditure, the claim to be ex-
empt from taxation as TO large and increas-
ing amounts OF property, held by those
most capable Of paying taxes, should be
)ealously scrutinized and resisted, where
unlawful. 10 my judgment, the present
immunity from taxation claimed Is unlaw
fol. On this subject, consider the language
OF Chief Judge McSherry in 90 Md, 633 !:
"The taxing power 10 never presumed TO be
surrendered and therefore every assertion
that 1t has been relinquished must, TO be eff.
cacious, be distinctly supported BY clear
and unambiguous legislative enactment To
doubt Is to deny an exemption"
The only legitimate object OF Article 81,
section 100, under which this freedom from
taxation Is claimed In behalf Of corporations
investing in Baltimore City stock, is to pro-
vide against double taxation and to 30 or
range that taxes elsewhere paid shall not bs
claimed or assessed twice. There is no sug-
gestion anywhere In this section Of surren.
denng the power to tax locally on account
oil this stock, or freeing corporations from
payiIg local, county and municipal taxes,
because State taxes only have been paid
elsewhere.
1t should be observed In this connection,
that It is not claimed that the corporations
getting the benefits Of these exemptions pay
any county or municipal tax Whatsoever by
reason Of the Baltimore City stock held by
them, nor ls 1t paid for them by anyone else,
although they seek credit and are being
allowed q deduction BY the State Tax Com
missioner just as though they had paid these
taxes or they had been paid for them.
am advised that the amount of Balti.
more CITY stock held by various corpora.
tions in this county has increased of late
and is now about $225, 10000. What is
said liz the inclosed letter 10 Colonel Schley
as TO deducting at 3 different value than that
taken for assessing is intended 10 refer only
TO Baltimore City stock.
By reference to the books In your posses
sion, the heavy burden upon real estate
owners OF this county 10 obvious and the
duty TO protect them from unlawful increase
of this burden would seem clear.
This whole matter has been sufficiently
Investigated for me to now recommend and
urge upon you the Importance OF appoint
ing counsel to make ready at once to pro
coed with such litigation as may be neces
sary for the protection Of the general tax
payers Of the county. According to your
resolution directing this preliminary inves.
tigation, no charge is made Tor the same
Whoever you may employ, l will be pleased
to supply him with such more detailed In.
formation and data as have collected.
Respectfully yours,
BLAIR LER.
Silver Spring, Md, January 81, 1907.
Silver Spring, Md, January is, 1907.
Hon. Buchanan Schey, State Tax Com
missioner, HsgersIown, Maryland.
Dear Sir:-Pursusnt TO resolution oil the
Board OF County Commissioners for Mont
gomery county, nave been investigating,
for the Board, the matter OF the taxation OF
corporations 10 our county. Under iurlher
resolution, passed oy the Board to-day, Al
my sugs estion and as proper towards you,
am authorized 10 communicate with yon
on the subject with view to the correction
by your Office oil what we conceive 10 be
grave errors and thereby avoid, # possible,
the litigation which would otherwise nstur-
ally follow.
II has been your practice, 10 assessing the
shares oil capital stock Of Maryland corpora
lions holding city stock Of the City of Baltl-
more, 10 deduct the amount OF such city stock
upon which State taxes have been paid or
are payable by said cily) from the gross
Va uaIlon VI the corporation's shares. 10 such
q way as 10 allow credit TO the corpora
ton not merely in the basis OF State TAXA
ton but also 10 the basis Of local taxation.
In other words, by your method OF reach
ing the assessed taxable value Of the shares,
the corporations escape local taxation on
the shares TO the extent that the capital stock
of the corporations Is Invested in Baltimore
City stock; and this, Notwithstanding the
fact that only State taxes have been paid on
such city stock.
After thorough examination into the
surject.matter / am oil the opinion that the
oct OF 1885. chapter sl9, (now embodied In
Code OF 1904. Art 81. sec, 1907 never coptem
plated anything more than that the corpora
ton should receive as "credit in the set-
Element Of the taxes" an allowance for the
amount Of the tax which had been actually
paid or was payable BY the City OF Balti.
more on such city stock. The only tax paid
or payable by the city is the State tax, and
this, in my judgment, is all that the LegIsla.
ture intended to ''credit In the settlement of
the taxes"
Under your method, city stock on which
merely State tax has been paid is treated
exactly like real estate upon which both
local and State taxes have been paid. That
this is not justifiable would appear not only
from the general intent merely to avoid q
second payment Of the same tax Tor ih
aouIvalantl lint alao frnun the ai0pI6c.n,