MICHIGAN ACADEMY OF SCIENCE. 
THE TAXATION OF LOCAL PUBLIC UTILITY CORPORATIONS 
IN MICHIGAN. 
BY EDWARD II. RYDER. 
The purpose of this paper is to discuss the taxation of local public 
utility corporations. This excludes from consideration the corporations 
of the utility type now under the authority of the State Board of As- 
sessors, and confines our attention to electric light and power com- 
panies, gas companies, and street railway and interurban companies, 
whose organization and activities are largely local in nature. 
That corporations of this type should receive special treatment from 
taxing authorities is not new to students of taxation. For instance, 
Dr. Adams in his work on Finance says. 
“The fourth class of industries that should receive 
special treatment at the hands of the revenue system 
is composed of municipal monopolies, such as street 
railwavs, gas companies, lighting companies and the 
like.” ' 
Adams Finance p. 453. 
An equally pertinent observation to be made in this connection is 
that these economists have not as yet attained any unanimity as to 
the best method of treatment. Consequently, it is no matter of sur- 
prise that legislatures hesitate to attack a problem of such insoluble 
difficulties. 
No time will be taken in this paper for the discussion of reasons 
for this special treatment of monopolistic utilities. Territory so 
thoroughly explored needs no attention before this body. We shall at 
once approach the subject -which is the occasion of this paper, and 
shall treat this matter under three subdivisions — (a) What is the 
present method of taxing this type of property in Michigan; (b) What 
are other states doing with this problem; (c) What procedure ought 
to be taken in Michigan today. 
(a) Present Michigan Methods: Local public utility corporations 
today are subject to the general property tax of the state as admin- 
istered in the various territorial taxing units which means that they 
are assessed in fractional parts as found in the different taxing areas, 
rather than as industrial units, and. consequently with little or no 
regard for any element of value other than the tangible asset. 
The only effort thus far made toward instituting a change in policy is 
that of the Special Commission of Inquiry whose report is familiar to 
all of ns. The only possible agency clothed with any authority and 
possessing the necessary competency to effect any change in method is 
the State Tax Commission which through its power to review the local 
assessments might fix a valuation comprehending both tangible and 
intangible values. The very limited activities of this body in this par- 
