Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1914-02-14

Editor Times epu blican: In recent
! issues Of the T.-R. there have been
published in regard to the comparison
OF farm and city taxes and values as
placed on property by the assessor. to
the conclusion Of whici, the farmers
are entitled to take excerlioa. First.
we ask for definition Of the term
actual value" and selling price
Many consider them synonymous; but
they are altogether distinct and separ
ate terms, requiring Inherent defini-
tons. No sane person would consider
as actual value the price obtained for
property which would declare divi-
dend of per cent when 5 per cent to
s per cent would be the legitimate ear
ing capacity of the money invested.
From this reasoning we form the de-
duction that selling price is usually
the price paid by some misinformed
purchaser, or Spectator which will
not return a legitimate compensation
on the investment. The actual value
is price paid which will return a
reasonable rate of interest on the in
vestment.
In your article for comparison you
gave for an illustration a 160-acre
farm valued at $4,000 and $4,000 in
vested in city residences, with taxes
on the farm as amounting to ss5.16 and
Of the city as 1850 You say nothing
as to earning capacity of each, which
is the real foundation for actual value
and ability to pay taxation. In the
case Of the farm it will rent for about
Sc per acre. After deduoting for main
tenance of fences, drains, water system
and al! farm buildings would require
an expenditure Of at least $3.50. which
would leave the magnificent sum Of 2
per cent return on the selling price.
The farmer then pays his taxes Of
ss5.16 and finds that his net income has
been reduced to / 2-5 per cent on the
investment The man owning the city
lots will readily rent each Of the ten
for $50 per month or total of $1,000
for the year. After having paid the
repairs on his city properties Of about
$3.50 he has per cent left on his In
vestrnent After deducting $3.50 taxes
he yet has over 1-3 per cent on the
investment Can't the owner OF the
city properties afford to pay his tax OF
$3.50 more readily than the farmer his
s95l6. 1t is self evident fact that
should speculation in farm land cease
and the selling price OF farm products
remain as now. then the selling price OF
farms must fall to their real value
An adjoining unimproved farm OF
$50 acres having a selling price of
$4,000 is difficult to rent for 50 per
acre. This farm is valued at $50 per
acre for taxation purposes. Consider
ing what the real value is learning
capacity is not this farm assessed for
more than 1t is actually worth? When
the value for taxation purposes OF ran
roads was determined nearly year
go was not their real value based on
a net earning capacity OF per cent?
II that was the correct method OF ar
irving at their values why not also OF
farmso BY that deduction the farm
adjoining should be assessed al value
of s43 per acre Farms in this neigh
borhood within the consolidated Iowa
township school district are paying
tax Of about $3.50 per acre. and when
we consider the earning capacity of our
farms we know we have an excessive
burden. Should misfortune overtake
us and we have an additional tax. to
nave public highways. then the earn