192 MISC. PUBLICATION 218, U. S. DEPT. OF AGRICULTURE 
property. This may be illustrated by the comparative trends in the 
index numbers of farm prices (30 items) and the index numbers of 
farm taxes from 1914 to 1930 in table 66. 
TaBLE 66.—Comparative trends in the index numbers of farm price (30 ttems) and 
farm taxes, 1914-30 ! 
Farm | Farm Farm | Farm Farm | Farm 
Year prices | taxes | Year prices | taxes Year prices | taxes 
| 
AQUA ee cee ee a ie 101 LOO 21920 Bee ee 99 GY Hp dh Pa eis 87 253 
TOUS Ree eee 95 LOQs WO 2 Tee ee ae 75 217 LOD 75 2 ee re lets, 85 258 
WONG cho see 95 LOSS O22 2 eee 81 PADS IRS prey y Lce  ee 90 263 
ON ee se 118 106 TODS eee Te ages ska 88 AG || eel G29 sees teres 89 267 
nie ose ead aes SEE 112 118 1G 2A Niet Sie eee Cs 87 249 LOZ Qa Se es 80 266 
1919S Se sew elas 102 PSOe | lO 25a eee 92 250 
1 Source of data: (82, pp. 16, 18). 
Real estate rarely earns a high rate of return, and this is particularly 
true of farm property. Thus, if a farm income was 20 percent less 
in 1930 than in 1914 and farm taxes were 166 percent higher, and 
taxes took 20 percent of the income in 1914, they would be taking 
66.5 percent in 1930. Since the basic value of property, particularly 
real estate, is its capitalized earning capacity, a tax that promises to 
absorb a large share of the income comes close to confiscation of the 
property. Land that, in the long run, offers no prospect of a substan- 
tial net income after taxes is not likely to remain long in private 
ownership. The sheer burden of property taxation unquestionably 
contributes to delinquency, and particularly so in the case of deferred- 
yield properties which, because of the uncertainty of future events, are 
subject to unusual risk. 
BURDENSOME SPECIAL ASSESSMENTS 
A great many city lots, particularly vacant lots, and many parcels 
of rural property have been driven into delinquency because of the 
burdens of special assessments. These special assessments, includ- 
ing the accumulation of interest, often approach or even exceed the 
value of the property. Where this condition exists, it has usually 
arisen because there has been no adequate preliminary investigation 
to determine the amount of existing assessments upon the lands and 
no adequate estimate of the amount of the proposed assessment. 
Without such information, neither the legislative body authorizing 
the improvement nor the property owners in the district can act 
intelligently. 
In a few States legislation has been enacted to prevent the more 
serious abuses of this kind. For instance, in 1931, California enacted 
a law which, in brief, provides for (1) an adequate preliminary 
investigation and report upon the financial feasibility and soundness 
of a proposed project, (2) a hearing of property owners after the 
investigation and report has been made and when the facts therein 
are available to all landowners in the district, and (3) a twofold 
limitation upon the amount of special assessments that may be 
imposed. ‘The assessment that may be imposed upon any one par- 
cel of land may not exceed one-half the true value of such parcel 
after the improvement, as shown by the report, nor may all over- 
lapping assessment indebtedness plus the proposed indebtedness for 
