New-York tribune., 1919-01-16
Measure
Meets Vigorous
Protest Here
Real Estate Men in Confer
cnce With the Controller
Tell Of Many Objections
Aims to Relieve Really
Holders of Long-T Term Bonds
to Pay and Owners Of
Intangible Property

State Controller Travis's pet meas
ure, an annual tax on mortgages, which
he proposes to present to the Legisa-
ture soon, is scheduled for the hardest
kind of fighting by local real estate
interests if expressions heard yester-
day at a conference on the measure
count for anything. The measure is
considered a most vicious one, which
would have untold harmful effect on
the mortgage and real estate interests
Of the state.
At closed conference in the Con-
troller's Office in the Woolworth Build
ing yesterday number of real estate
leaders of this city gathered, includ-
! ing Cyril II. Burdett, vice-pres sident Of
the New York Title and Mortgage Com
pany; Bernard NJ. Hurd, president OF
the Lawyers Mortgage Company;
Richard C. Babbage, of the United
States Realty and Improvement
Company, and who represented
the Real Estate Board Of New York;
Walter Lindner, of the Title Guaran-
tee and Trust Company; Alfred E. Mar
ling, Of Horace E. Ely 6. Co., and presi-
dent Of the Chamber of Commerce; !;
Alfred Milbank, representing the Advi-
sorry Council of Real Estate interests; Z;
Nathan Hirsch, chairman of the
Mayors Committee on Taxation, and
Adolph Block. of the same committee.
Controller Travis told of his plan to
introduce into the Legislature a meas
ure which would tax mortgages at the
rate of So on every $1,000 annually,
after a certain period of exemption,
which he has not definitely decided
upon. Mr.. Travis explained that the
measure was necessary in order to in
crease the revenue of the state and
that mortgages would have to be taxed
annually and also lot Of things, such
as savings bank deposits and invest
mcnts. if new revenue sources other
than those mentioned were not discov-
cred, because the financial situation Of
the state is acute.
The Controllers suggestion was met
with protest from the gathering. Every
man who spoke told the Controller that
such measure would be harmful to
real estate, and that it would not lift
the burden from realty, which was
supposed to be the Controllers ann.
He said that a bill such as he sug-
gested would help real estate because
the tax would reach intangible prop
erty and in that way return revenue
to the state, reducing the heavy duty
on real property IT was explained
intangible property in this state that
is free of taxation by the payment of
a mortgage recording tax of one-half of
l per cent of the value represented
bV the instrument
This intangible property has value
equal to two-thirds of the value of
the property, which must pay the cost
of operating and maintaining the state.
About so per cent of the intangible
property valuation, it was said, is
corporate trust fund mortgages run
ming for many years, 10 per cent of
this intangible valuation represents
short term mortgages, and the remain
ing 40 per cent mortgages on homes
and land of the state.
earned for the state $50, ,0000 900 in
twelve years. 1t should earn more, Mr..
Travis said. In taxing intangible
property annually, the Controller
pointed out, 70 per cent of the tax
would come on things not real estate
and that this new revenue would re-
lieve real estate by increasing the
funds Of the state.
But the real estate men could not
see things that way. They claim that
the tax suggested would be an addi
tional burden on real estate, no matter
from what angle the situation was
looked at.
Walter Lindner told the Controller
that an annual mortgage tax was not
comprehensive. of you tax the bonds
Of public service corporations this
will go to our relief, but to place an
annual tax on mortgages will increase
the burden on the man who owns
home, or farm, or any real estate
which carries a mortgage. An annual
tax is burden on land and must be
paid by the owner of that land. When
you tax money you increase its value.
This will have the effect Of changing
the mortgage situation. 1t was said
that there is $6,500 100000 loaned on
property in this city. If a new tax
is placed on mortgages it means that
the mortgage holder can claim his
money under a clause in all mortgage
documents made for the last twenty
years
The Controller asked Mr. Lindncr
if this was a threat by the title COM
panies.
Mr.. Lindncr suggested that p state
income tax be passed instead OF tax
or mortgages as a means of increasing
the revenue of the state. The Con
troller said he was opposed to meas
ure which paralleled a Federal measure,
as a state income tax would do at
this time.
Mr.. Babhage. who was there to talk
for his own interests as we'll as the
combination Of interests represented
by the Real Estate Board of New York,
said that the Controllers plan for
taxing mortgages was poor way 10
relieve real estate. The Real Estate
Board Of New York is for exemption of
all tax on real estate mortgages. He
said that there were a lot of other
means available in the state for the
Controller and the Legislature to levy
on for new revenue.
Mr.. Block, speaking for the Mayors
Committee on Taxation, opposed the
Controllers suggested new form of
revenue because he said that tax on
mortgage would result in $4,000, 900 900
invested in New York City mortgages
coming due. He told the Controller
that the Mayors committee had a num-
Der of measures under consideration.
any one of which would more than
equal the return that could be had BY
placing a periodical tax on mortgages.
The cimmlttee will ask that the
Emerson bill, which is the measure in
troduced a few years ago taxing ma
ri ho