Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1926-11-04

used and this fee of SIT is translated
! into a tax it would give a value of
only S445 on this new model of the
current year. l doubt whether that
tax value would be acceptable to
many OF the assessors.
Il do not question the wisdom ex-
| pressed in this scale, for prabably 1t
| was compiled after much study and
| to meet certain conditions, but to fit
requirements in our State where the
average tax rate is over SO mills the
| reduction in revenue would be too
great"
Mr.. Kurdish then explained the
, method of establishing the proposed
fees to determine a method of valua-
! ton and the discounts to be made
from the companies price lists in
| succeeding years in figuring auto
| valuations. For easy figuring we will
| take a car listed by the makers at
| $1,000. Discount this by so per cent,
! and you have a total value of $500
| for the first year. Now multiply this
! amount by the average tax rate of
/ SO mills and the result is $3.50.
LAS a time saver and incidentally
as revenue producer we wilt adopt
| the round figure of 81 mills which
you will note is four-tenths of a mill
| that 1t can be adopted without In
! flicting a great hardship on anybody.
| The remaining figures of the Fee List
! can be explained in a similar man
ner."
| In conclusion, the speaker gave an
! explanation of several of the techni-
cal points Of the New Hampshire
! laws.
, Names Nominating Committee
At the opening of 'he Wednesday
| meeting, President StetSon named the
members of the nominating committee,
| whose report was adopted at the aft
| ernoon session. Members of the COM
| mittee We're: George +. Hathaway of
| Norway. Howard G. Wakefield of Bux-
| ton, and Henry G. Hodgdon of Bath.
| The assessors were welcomed to the
convention by President Stetson, who
| introduced as the first speaker. John
| f. Goodwin, acting chief engineer of
| the Public Utilities Commission.
| Address by Engineer Goodwin
| Expounding the topic, Valuation of
| Public Utility Property as a Basis
| of Taxation" Mr. Goodwin pointed
out that in Maine there are about 400
| public utilities, including IS electric
. light and power companies, 159 water
| mainder being steam and electric
| railroads, steamboat companies, ex-
| press companies, telegraph companies,
| etc. The electric light and power COM
| panies have an aggregate book value
amounting to about S115,3 goo 900 and
! pay in taxes about Sf,070,000 yearly.
| These tax figures include Federal in
/ come taxes in the case of the water
! companies and some of the smaller
utilities of other classes.
| "a common delusion that the pay
| ment of large amounts of taxes by
. the utility companies results in q
| reduction of taxes ultimately paid by
! the members OF A community seems
| to exist" he said THE fallacy of
| this reasoning is quickly apparent
, when one considers that all taxes paid
| by a utility are reflected in the rates
charged for its service, since under
| odern methods of accounting. taxes
| are deducted from gross revenues,
| which makes them in effect an item of
, operating expense"
Mr.. Goodwin stated that valuations
of public utility property are made
upon several different bases, depend
| ing upon the purpose for which they
are made, the common bases being:
Original cost, reproduction cost, and
reproduction cost less depreciation
After explaining these three bases, he
showed that while they are not definite
| indications of value, they are at least
elements which must be fairly con-
| sidered in a determination of fair
value.
THAT the use of such bases re-
auires assessing bodies of wide expe-
rience and ability, who can devote
great deal Of time TO the subject, is
an objection to this method of valua-
tion," he asserted. Further, such
| method does not take into account a
very important element of value as
| a tax base-namely, the earning ca
pacity of the plant. 1t is conceivable
that two plants Of identical charac-
teristics as far as physical property
is concerned should pay taxes upon
entirely different values, dependent
upon their individual earning abili-
ties"
The speaker then discussed the base
Of value termed Sales Value" or
Market Value" this term compre-
of sale from a willing seller to
willing purchaser. This seems to be
, the accepted basis In cases of ad va
| loren assessment of taxes"
He pointed out that the determine
ton of value cannot be reduced to
mathematical basis and that there
| must be exercised in each case ma
terial amount OF judgment, which will
so combine the effects of the various
elements as to yield a result which is
truly representative of value under
. the prevailing conditions.
Chief Engineer Sargent Speaks
Describing the extent of the high
way work in Maine, Chief Engineer
Paul D. Sargent of the State High
ay department, at the afternoon ses-
sion of the convention stated that the
first appropriation for State aid was
made % years ago, $4,000 of which
$4,000 was used in paying State aid.
, This called for an expenditure by
towns of $4,000.
In 1925 the towns expended $685.
505.25 for State aid road. The State
expended $740,16S29. The total for
State aid road for 1925 was S1,339.5S.
The State Highway Commission
was organized 10 years ago next
July and has built highways for ~
years. The sum of S52,000,000 has
been expended under the direction of
the Commission. Miles of road built
number 1900. There were 500 miles
of State aid when the Commission
undertook the work. The number of
miles of improved road now is $500.
There will be 1870 miles of i'm
proved State highways when work
now under construction is completed;
90 miles of concrete. 240 miles of bit
luminous macadam, 500 miles of sur
face-treated gravel and 400 miles of
plain gravel. There will be 1900