Los Angeles herald. [microfilm reel] (Los Angeles [Calif.]) 1900-1911, 1907-08-13
AUDITOR DECLARES COLLECTOR
is NEGLIGENT
SAYS CITY HAS LOST MANY
THOUSANDS
E. E. johnson Must Appear Before
Council Next Monday and Ex-
plain Failure to Collect
Certain Licenses

to collect Will be brought into the city
treasury at once through the city attor-
neys office.
In report bristling with sensational
statements City Auditor w. c. Mushet
told the city council yesterday how his
force of experts had uncovered numerous
cases where the city lost thousands be-
cause the collectors failed to go after
the money or to press the collections
This is but the beginning of Auditor
Mushet's investigation into conditions
showing how the city has been misman-
aged and is being mismanaged through
carlessness. ignorance or worse, on the
part of certain city officials or their dep
uties.
Regardless of individuals, corporations
or interests Mr.. Mushet has announced
that he viii keep on working in obedi-
ence to what he considers his duty laid
out by the charter, and revelations may
be expected that will startle.
At the suggestion of Councilman Wal
lace, Collector Johnson was cited to ap-
pear before the city council next Monday
to explain why the collections had not
been made. The invitation had been eX-
tended to Mr.. Johnson in time to hear
the reading of the Mushet report yester-
day, but tNhe did not appear.
Acting President of the Council Henry
Lyon stated that Collector Johnson could
not appear yesterday. He also agreed
that 1t would be best to let the collector
state his siue of the question next Mon
day.
The Mustet report was as follows:
To the City Council Some time ago 1t came
IT, my knowledge that of the license or
dinances of the city not being enforced
at all. and that in other cases only a part of
those subject to license were being collected
from, and that in other cases the full amount
OF the license under the ordinance not be-
ing collected
Having satisfied myself that this fact.
1 asked W. j. Palethorpe, president Of the
Western Audit company of this city to assist
me in paking investigation. At the sam
time 1 employed number of outside men TO
work under the direction of Mr.. Palethorpe.
We have got this investigation we'll under
way and wish at this time to make a prelim
mary report.
We find that for some reason or other the
city is not collecting from great many per-
sons at all, and that In other cases the city is
only collecting part of the money to which
1t Is entitled and that in several cases ths
ordinance is being entirely disregarded and iio
collections certain lines of business are be-
ing made at all.
Not All Lost
1 think it but fair to say that in a great
many of the cases that have come under
notice the parties affected have been perfectly
willing to pay the license required by the city
and to adjust differences covering the last two
years when the matter has been explained to
them.
The neglect of those charged with the collec-
tion of licenses TO enforce the city ordinances
for years past has cost this city tens of thou
sands of dollars per year.
In many cases we can adjust the loss which
the city has sustained during the last two years,
but in great majority of the cases, owing to
the nature of the various businesses, 1t will be
impossible to do more than to place matters
Oh a correct basis from this time on and tn
city will have to stand the loss which has
been occasioned by this neglect.
I will call attention the fact that n
Ger the license ordinance 1t is the duty of all
police officers to examine all places of busi-
ness and persons in their respective beats liza
BILE to pay license, and that they are required
to make out monthly report of all persons
doing business on their beat without city
license, and that in case of neglect SO to do
liable to suspension or dismissal.
Police Ignore Law
This is absolutely dead letter" so far as
the police corporation is concerned. and l
think that steps should be Immediately taken
to enforce this part of the ordinance.
Let me say thai L have Laken up this mat |
ter of the examination of license collections |
simply as matter of duty. the charter COM
pelling me to exercise jurisdiction the col
lection of city revenues. and that in so doing |
am refraining from considering the 'consti |
tutionality or inoeed the justice of any Of
ficer of the city TO suspend or repeal in effect
an ordinance which has been established by |
the legislative body of this city.
1 will call your attention to these specific
matters:
Bankers License
The banks of this city subject to
monthly license on graduated scale running
from $40 to $50 1 find that in many cases |
for years past many of the banks have been
paying on the lower instead of on the higher |
scale. For instance, where a certain bank
should pay a monthly license of $40 it was be- |
ing required by the city to pay only $40.
The banks, almost without exception. very |
willingly agreed to pay the higher rate and
also have settled with the city for deltnquen- |
cies covering period of two years last past
In this adjustment there were seventeen banks |
involved. We have been able to adjust matters
with thirteen of the seventeen,
leaving four banks yet under discussion.
The thirteen banks which have adjusted mat
ters with the city should pay a monthly IL
cense of $40. The city was collecting $3.50 or
S13O less than they should pay. The delin-
quency of these thirteen banks, covering |
period Of the last two years, amounted to
$685..
Office Buildings
The ordinance requires every person, firm or
corporation maintaining, managing or conduct
ing a building for the purpose OF letting othce
rooms store rooms to pay license to the
city. These office buildings should produce
yearly income TO the city of S69O1.
The arrearage which is susceptible to collec-
ton amounts to $17, 500.
From investigation 1t would seem that an
attempt was made to collect this license some
years ago, but that the large owners pro
tested against the paying of the license and
that the matter allowed to drop no tur-
ther effort being made to collect the same.
1 have notified all the parties involved In the
matter of my intentions to enforce the ordl-
nance and collect the license. and am furnish
ing the city attorneys office with detailed
particulars so that he may at once commence
understand that the parties involved have
organized and intend to resist the collection
of this license claiming that the license is un-
constitutional
Insurance Agents
Insurance agents are subject to a tax of s.
quarter. An investigation discloses that less
than 25 per cent of those who should pay this
tax were actually paying.
We have not completed our work in this de-
partment as we have 1853 cases still pending
and which do not enter into the following fig
lres.
The cases which we have investigated will
produce an additional quarterly tax OF S625,
and of these cases there is delinquent tax TO
be collected amounting to Si44O
For Selling Water
The ordinance providing that all persons.
firms or corporations. other than municipal
or carrying on the business OF vend-
ing water for domestic purposes shall pay a