The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1924-08-26
RAILR0ADSIN
| SHARP DEMAND
FOR TAX CUTS
Tell State Board of Equaliza-
tion They Are Taxed Un-
fairly in N. d.
ALSO PLEAD POVERTY
Declare That Showing on
Earnings Is Such That
Economy Must Be Had
ALSO PLEAD POVERTY

ia have placed their plea for a reduc-
tlon in taxes through lowered valua.
tion before the state board of equal
lzatlon. The representatives Of the
roads have come before the board
with unusual emphasis this year, de.
claring they are not prosperous and
that they are unfairly taxed.
The railroads representatives have
told the state board they are taxed
higher in North Dakota than
other Northwestern states, being
much higher taxed here than in Wis.
consin, the home of Senator LaFol.
lette. The state boards figures arc
pointed to by the railroads. The
scientific method used of figuring
the railroad valuation in 1923, which
was by taking the average of the
capitalization of the system net oper-
ating income, on five, three and one
year basis, the U. S. rental, not oper-
ating income plus federal guarantee
averaged 19l91923, capitalized at G
percent, and the net market value OF
stocks and bonds, deducting estimat-
ed value of incorporating property
gives a much lower basis than that
on which the roads are taxed.
Higher Than Minnesota
The railroads also point out that
If they were taxed in North Dakota
as in Minnesota-on a gross earnings
basis-their tax would be cut re.
markably.
''In 1923 this board placed valua
tion of $75,574.275 upon the operat.
ing property of the Northern Pacific
Railway Company in North Dakota
reads the statement Of that road ia
the state board of equalization. 1.-The
property is not worth that sum, nor
is it worth for taxation any sum ap-
preaching that figure. This is OBJ.
v$ously true when it is considered
that we have not, and cannot make
fair and reasonable return on that
valuation
For 1928, the road asserts, its gross
revenue in North Dakota was nearly
$lO,O0O,O0O short of being enough to
enable it to produce a net return OF
S 3-4 percent on its investment.
"North Dakota" said the roads
representative, because of her geo.
graphy, is especially in need of new
railroad construction. and therefore
ought to offer every inducement to
such construction. and not penalize
the company in the way of excessive
taxes.
"From North Dakota, and elsewhere
comes an insistent demand for the
reduction of freight rates, and moth
ing would please the railways better
than to be able to reduce the rates;
but how can that be done when 81
cents out of every dollar received has
to be expended in operating costs
and taxes?"
In concluding the roads represen-
tative, M. T. Sanders, tax commission
er declared: "North Dakota railroads
cannot grow, and the state cannot
reach its full measure of growth and
prosperity if the railroad companies
are not permitted to earn enough to
build new lines and add constantly to
their facilities and equipment
Freight rates cannot be reduced to a
point satisfactory alike to the rail
roads and the shippers if you take
from the companies all their profits
by way of taxation. We ask that
our valuation for 1924 be reduced
materially from that of 1928"
Spend Too Much
North Dakota's difficulties with re-
spect to taxation, declared James T.
Maher. right of way, land and tax
commissioner, are that the state is
spending too much money.
"North Dakota is trying to do in
a few years what it has taken sister
states like Iowa, Minnesota and ILL.,
inois, great many years to accom-
plish," he said. "Then, too, there
are no great reservoirs of wealth to
draw on outside of the railroads
light and power companies and like
corporations. In other words North
Dakota is trying to keep up with
the jones' If we want paved streets,
cluster lights, arterial highways, fine
state and county buildings, good
schools (and we should have good
schools) We must pay for them. If
we put the state in the business OF
operating elevators, packing plants
and banks. we must pay for these en-
terprises, but let US get at the facts
and stop charging the other fellow
with evading his taxes until we know
the real situation"
The 500 line, in addition to COM
planning of the valuation in general,
declares its lines in North Dakota
are assessed too high in comparison
to other roads.
ut has come to pass that the rail-
road representatives who appear be-
fore this board no longer discuss the
right of sufficient net earnings to
warrant further expansion: now in
desperation they are mostly concern
ed with the privilege of continuing
operations on the actual basis of ex-
penses." said the 500 line statement.
500 Line Reduction
A material reduction in the valua-
tion of the 500 line for 1924 taxa
tion is justified, it was declared. The