Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1914-04-01

saying that the taxes would be less. 1t
was pointed out to him at the time that
he had inadvertently used a wrong per-
centage in his computation and after re-
viewing his figures he later on stated TO
the committee that the computation sub
mitted by the Railroad Company was
correct. l only mention this incident as
possibly accounting for the understand
ing that the taxes were to be decreased
to which you refer. l did my best to
correct any false impression which might
have gotten out, but experience has
taught me that it is exceedingly difficult
to ever fully repair the damage done by
a false report once in circulation.
The figures presented to the committee
were estimates of what would take place
in the future If the bill became a law;
1t may interest you to see briefly stated
what actually did take place
At the date of the hearing the taxes
for the year 1911 had not been assessed
but would accrue as OF the following
April LIST, and would be based on the
arnings of the year ending June 10th,
1910 These taxes assessed upon the sep
arate proportion amounted TO S4li,hoo,5i
and were subject to the $500 rebate, max,
ing the net tax s401, a6s. 20, which was paid
to the State treasurer. Had they been
assessed upon the properties as one,
merged under the terms OF the bill, tnev
would have amounted to S4li,56S or an IN
crease of 81, 299. 30 These figures were
all available at the time of the hearing,
SO it was known exactly what the result
of the merger would nave Deen On eHS
taxes of 1911, could il have been applied
to them.
The tax of 1912 was to be assessed upon
the earnings of the year which would not
end until the following June goth. ana
hence only an estimate could be present
ed for that year, but it was evident that
the tax must be greater under the nheT-
ger than otherwise AS matter OF tact,
the tax assessed and paid by the Name
Central for the year 1912 was si22 723.5s,
while the net taxes which would nave
been collected, had there been no Mer-
ger Act, would have amounted to S4v.,-
1853. Is, showing gain OF a, sl9,os''s4 10 'ie
State by reason or the merger.
The tax paid for 1918 on the entire
merged properties was assessed upon tne
earnings of the year ending June DoIh,
1912 These earnings accrued after tne
merger took effect. and were not Kept
separate as to the original properties,
and hence 1T is impossible to tell exactly
what the tax would have been had there
been no merger. But, we Know .hae tue tue
creased s579 .33 for the year as com
pared with the year preceding, and II we
assume that such increase was un11orm
on the original properties which were
merged the net tax figured upon the
basis which prevailed before the merger
would have been si35, 70, while the tax
actually assessed a ga the Maine tde Central
was 1863, 00S91, being a gain of s27,ioe u
in the amount received in taxes for the
year 1913 by reason of the merger.
The prediction made at the hearing
seems to have been fully Justified by the
actual results obtained, and | DO not
think that any one who followed the
hearing was under the impression Una.
ed 1T Is quite evident that no promise
as to mileage rates could have been
made in consideration of reduction In
taxes when the railroad company and
the State auditor agreed that an increase
Of such taxes would be the result OF the
merger. 81, =
formed as to what took place at the
hearing had any idea that promise
was made to maintain two cent miieage.
but rather knew that 1t was expressly
stated that no such promise could pc
made or assurance given. Let me re-
call the conditions then existing. the
Washington County Railway was selling
a mileage book, the Som efss 6 Gnnsral
had its own books on sale. Neither OF
the books were good on either or the
other roads, but think the washington
County differed in price and the Somerset
in conditions--the latter not good mile
for mile above Bingham .
1t was stated at the hearing that in
case the merger bill became law, the
Maine Central books would be good over
the entire system. The question was
asked if the rate of two cents for the
Maine Central books was to be main
tanned, and the reply was that while
there was no expectation of any change
at that time, no agreement could be
made that the rate would always De
maintained. In fact. it was stated that
the Railroad Company, in view .., OF the ne
unfortunate situation then existing in
New Hampshire arising from some rates
which had been established by contract ct;
sides to be unjustifiable, and in further
view of the rapidly. increasing cost OF
operation, felt that it would not be JUS
tilted in making any agreement whatever
as to rates. The only assurance was
that the Maine Central books at
whatever rate issued would be good
over the entire system, and this
assurance was embodied in a letter filed
with the committee of which the follow
ing Is copy:
Portland, Maine, February g. 1911
Mr. Seth M. Carter,
Attorney, Maine Central Railroad,
Augusta, Maine.
Dear Sir:
If the proposed merger of the Washing
ton County Railway, Somerset Railway.
and Sebasticook and Moosehead Railroad
with the Maine Central Railroad, under
the terms of the bill now pending in the
LEGISLATURE is made 1t would be our in