Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1922-08-24
s11,000,o)0 BOOST
IN POWER COMPANY
VALUATION SOUGHT
Dixon Supports Haugen's Fig
ures, While Firm Protests
Strongly.
(Tribune's Helena Bureau.)


Helena, Aug. 23.-While figures
collected by tax men both in the en-
ploy of the state and of the large
taxpaying corporations go to show that
the general property in Montana is
assessed this year at not to exceed so
per cent of the true value, the state
administration is this year endeavor-
irg, through a valuation figured by
Nils P. Haugen. tax expert of the
state board of equalization, and
energetically supported by Governor
Dixon, to increase the assessment of
the Montana Power company to a
figure 81 100000 or more in excess
of that of last year
This was brought out at a hearing
Wednesday before the board, upon the
assessment of the pewer company, at
which l.. o. Evans, Frank M. Kerr,
Dan M. Kelly and other representa-
tives of the company appeared to pro-
test the proposed increase.
In his tentative assessment, Mr..
Haugen figured the net earnings over
a five-year period, after deducting in
terest charges, of s1,965, 1885, which
when capitalized at eight per cent
equaled $24, ,564, $50 adding to this
figure the average market value of
stock and bonds of the company over
five year period, making S2S, ,637. .667,
giving total of S53, ,202, ,517, the figure
which the administration seeks to
assess the power company this year,
IN comparison with an assessment of
Sal ,265,0 900 for 1921.
includes Falls Company
This assessment includes the hold
tnua nf tho Groof Eo1io
pany and the Thompson Falls Power
company.
L. o. Evans, appearing as attorney
for the power company, protested that
Mr.. Haugen's method did the company
an injustice He said it was different
from the enterprise with which MIR.
Haugen dealt in Wisconsin In that to
a great degree it is a mining venture,
half of its investment being based on
mining operations. He said the com
pany was taxed on its full value last
year and that even if the board should
equalize the assessment by making it
so per cent of this valuation it would
still be above other property valu-
ations.
F. NJ. Kerr, manager of the power
company, held the state should take
the actual property value in this case,
holding the property value to be
around $50, 100000. Even by averaging
the inventory the gross income and the
capitalization of net earnings, he said
the result would be around S35 90. 600
He insisted that the proposed valua-
ton would so increase the tax charges
that it would affect net earnings and
thereby have its effect on the new
valuations for next year.
Stocks and Bonds Figured
1t was shown that the average mar
ket of the stock over a period Of five
years was $38 1865, 1888, and the average
market value of the bonds, SOS, ,637, ,667.
making a total of $67, 7,O06,650, which
amount Governor Dixon said should
really be the value of the company for
taxation purposes.
Mr.. Kerr explained the injustice of
this method and said that if the com
pany had been wholly financed by issu-
ance of capital stock instead of by the
sale of bonds, the valuation by this
method would be SS,000,000 less than
the present valuation. He showed that
in state, city and county taxes, ex-
elusive of federal taxes, $685. 900, or
more than 10 per cent of its gross
earnings. He sought to impress the
board that it's duty is to equalize the
taxes of the power company in accord
with the taxes upon other property in
the state. He informed the board
that other property in the state is gen.
orally assessed at least 20 per cent
below the true value and that figures
collected by the comyany's tax depart
ment proved it.
Comparisons Cited
He presented table showing that
comparisons made in all counties up
to 1920 showed general assessments at
70 per cent of the true value; that
81 counties carried down to 1921 show
ed assessments of but rs per cent of
the true value, and % counties in 1922
show but 695 per cent of the full value.
Mr. Haugen said his figure was in
tended to show the true value of the
company but he believed it should be
equalized to other property, probably
on an so per cent basis.
No action was taken by the board
and it adjourned without further dis
cussion of the question, which will
probably be disposed of some fine fol-
lowing the urinary election.