The Owosso times. (Owosso, Mich.) 1897-1926, 1911-02-10
State to Continue Flight Against o., q.
n s. NJ. Ry.

Plans are being considered by tn
legislature to renew the attack on tn
Detroit, Grand Haven 81 Milwaukee
railroad. which is paying at presen
about one fifth of the tax which tn
state believes that railroad should pay
Fortified by an incorporation law secur
ed in the pioneer days Of the state thi
big corporation in paying the SAM
rate of taxation it did in the days whel
Michigan was sparsely populated
state with practically none of the grea
industries or agricultural INTEREST,"
which make railrosding a profitable
Investments in these times.
For years the state has been carrying
on legal battle with the company In
an effort to force it to come under The
same system of taxation as other rail
roads in Michigan. Thus far every
case has failed, but there is another
pending in which state officials have
some hope of success. and now certain
prominent members of the legislature
are asking IL there can be found q way
in which the state can institute opera
tions Of reprisal, and force the railroad
to bear its share of the expense OF
government. While they will not dis.
cuss the details of the plan until there
has been q further investigation to
determine the prospects Of enacting a
law which will make the big corpora
ton amenable as are others to state
taxation laws, it is known that these
state officers whom they have consult
ed believe there is way.
In this connection the suggestion is
made that the state should announce q
definite policy of warfare with the
railroad until the corporation makes
some concessions. State. officers have
declared that this company has no
excuse for avoiding its share
of the tax spread against all property.
They point out that while the company
has fought to avoid coming under the
ad yalorem tax system, it has kept
down the small specific tax it is assess
ed by methods which other corporations
in this state abandoned years ago. In
fact the story of the d., q. FL. & M, in
Michigan is not such, they say, as to
entitle it to any consideration by the
state. and it is believed that the legis.
ture when the facts are laid before it
will act promptly to enact the required
legislation.
State officers declare the case against
the railroad is proven by the opera
lions of its managers. The original
capital Of the D., G.. A. & M. was
Be, 339, 154. and the company still insists
On paying tax of one per cent on that
original investment, as provided in the
aot Of incorporation, although they
~ officials of the company have ad-
nitted in law suits, 80 that it is a mat.
Ter of record, that the real capital
stock today is about 100000 Sin
the company is paying an
1ually to the state about $25 900 in
;axes when. except for technical subter-
,uges, the road should be paying $7O.-
100 on capitalization of $7,000,000.
Adding to the irritation over the situa-
ion is the general understanding that
he Grand Trunk, Canadian road, owns
most if not all the stock of the COM
,any, whereby the profits ii earns are
AIKEN out of the state On a basis of
axation as the state tax commission
las valued the road, and proportionate
o the taxes other railroads are paying,
he D.. G. 81. & M. should be paying a |
ak of approximately $4,000. In
Their words the company has avoided |
aging over 81, 000,000 in taxes to the
tate since the time an ad yalorem
axation system was established and
Their railroads were forced to contribute
heir fair share of the expenses of
overnment. Since 1860 the company
as issued over ~, 600, 900 in preferred
tock as well as turned back in earn
lgs 81, 046, 900 and issued treasury
took of approximately S2,0OO,0 900.
'hese facts have been brought out in
be course of the states war with the
ompany and Attorney General Kuhn
as in the courts case in which he is
to force the company to at
,ast pay taxes on its real capital which
epresents somewhere near what the
bad is worth today, instead of allow
1g it to continue to hide behind that
ct of incorporation granted in days
7hen the. people of Michigan were
early ready to mortgage their homes
D induce railroad building in the state
Lansing Journal Republican.
Sees Rum In New Treaty
Former Secretary of the Treasury
,eslie M. Shaw in Philadelphia in.
srview took positive ground against
he Canadian trade policy of the ad.
although admitting that
l. 900 80 %I~.o Do--lp