The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1913-05-25
STATE GRANTED
WRIT OF ERROR
Auditors Effort to Tax Municipal
Properties Goes Now to-
Supreme Court.
SHOW PLANTS EARN MONEY
Writ of Error Also in Proceed
ing Against Lynchburg
Y. M. c. A.

The Commonwealth won the first
skirmish In its fight to have cities
pay taxes on profit-earning munich
pal properties when the State Su-
preme Court of Appeals granted a
writ OF error yesterday In answer to
the petition filed by Attorney
Williams in tho test case Of the Com
monwealth against the city OF Rich
mond. The case was brought UP from
the Hastings Court OF Richmond, IN
which, by due process OF law. the city
obtained tho customary exemption
from taxation on January 3, 1918.
The sum claimed by the State from
the city OF Richmond In taxes Ia
$36,63s75. the greater part OF the as
easement having been levied on the
productive municipal gas and water
plants
Tho state is making no effort to coll
lect taxes on property owned by the
oity, used exclusively for city pur-
poses and for the benefit OF the people.
but is endeavoring 10 remove the ex-
emption from such municipal enter
prises as are earning profits. All
schools. parks. the City Hall, jails and
property of n similar character do not
figure In the present controversy. Tho
Commissioner of Revenue assessed
taxes Of S3o.639.75 upon the following
proht-earning city holdings: the First
and Second Markets. the City Audi
torium. the Reservoir. settling basins,
pump house. gas plant gas mains.
water and sewerage mains
Sells Water to Outsiders.
missioner OF Revenue. the city water
system in 1911 received, over and
above the expenses of operation, the
sum OF $4,000. Moreover, the State
declares. water is supplied at n proft
TO persons and industries outside the
city limits. and on that account the mu-
nicipal water system Is no longer
used exclusively for city purposes, as
laid down In the Constitution. Tho
gas plan was assessed for earnings.
over and above the cost OF mainte-
nance. Of $4,000, and together with
the gas mains, taxed for sI2,25o.l9.
The sewerage system was taxed for
s7,S75. From the rent OF stalls In the
markets, according to the State, tho
city obtained in one year. over and
above expenses. se,Ss3.ss. The City
Auditorium earned SS45 net
The argument advanced by the state
authorities is that these city proper
ties are no longer exempt from taAa-
ton, having ceased TO be strictly mu-
nicipal utilities. and grown into rev.
enue-earn!ng industries. The assess-
mont itself Is not questioned: II Is ad-
mittcd TO be reasonable. Tho city is
nghGng CO retain the exemption con-
ferred by the Constitution under GER
tain conditions. The amount involved
in this particular case represents only
n small portion CT the revenue which
would roll into the State Golfers If
the States construction OF the Con-
stitu,ion is upheld by the courts. The
as a test case. and no effort Will be
mads by the State to collect taxes
from other Virginia cities until this
case IS finally decided.
Writ In Y. NJ. G. A.. Cnse.
Another test tax case, of immense
Importance to Young Mems Christian
Associations and public organizations
OF n kindred character was also ad-
mitted to the State Supreme Court
yesterday. A writ OF error was grant
ed the Commonwealth In its sui,
against the Lynchburg Young Mems
Christian Association, brought up from
the Corporation Court or I.ynchburg
The same question involved in the
case: the State claims the exemption
from taxation is removed when the
Young Mons Christian Association
uses IT'S building for earning money
The Commissioner of Revenue as
sess ed taxes of s16S against the Lynch
burg Young Mems Christian Associa-
ton on its $4,000 building and eighty
foot lot on Church Street. According
to the requirements of the statute, the
association appeared in the Corpora
tino Court on March 3, 1913, claimed
erroneous assessment and was reliev.
ed OF taxation by the Judge. The
State appealed
While admitting that the associa-
ton is actually conducted at none
tary loss. the State alleges that by
renting bedrooms on the two upper
floors and operating a billiard room and
bowling alley in the basement, the
association ceases to be conducted foI
purely religious and educational pur-
poses. Should this test case be won
all Young Mems Christian Association
and Young Women's Christian Asso-
citation property In the State will be-
come liable for taxation.