96 
FIFTEENTH REPORT. 
lieular capacity — thus far, three counties have been reviewed — is scarcely 
sufficient to reveal what their policy may be; but the accompanying 
tabulation (Xo. 1) is presented for the purpose of showing the changes 
made by the Commission in the valuations of local utility corporations 
in three cities of said counties. The fact that these properties are 
located in growing centers where both the valuation of these properties 
and extent of business have been rapidly expanding, taken together with 
i he fact that the review has been made at a period succeeding a very 
marked advance in all values, leads to the conclusion that the com- 
mission has not given a satisfactory estimate to the intangible assets 
of such corporations. .V comparison of these figures with similar data 
for non-utility corporations and private property seems to justify our 
conclusion. 
Are we justified in assuming these corporations to be undertaxed? 
The data from which to answer such an inquiry satisfactorily and 
conclusively is not available to the unofficial investigator for the reason 
that the state at the present time has not provided means whereby the 
necessary data can be collected. The law requires every corporation to 
file an annual report with the Secretary of State, but this report is so 
limited in scope and reported under such diversified svstems of ac- 
countancy that it is of little value for answering this inquiry. The only 
other source of information is to be found in the annual reports of street 
and interurban railways made to the State Railroad Commission. These 
reports, so far as they extend, are valuable and reliable. 
Light has been shed upon this question by the report of our Special 
Commission of Inquiry. In fact, this is the only reliable evidence, aside 
from that found in Railway Commission records, that we possess. This 
body was confronted with this situation, and had it not been for the 
data made available to them by the Commissioner of Internal Revenue*, 
but not put at the disposal of private parties, they scarcely could have 
made a report on these matters — at least, not without an investigation 
of the private accounts. 
Utilizing the little data available in the state records, let us examine 
the information at our disposal. Table Xo. 2 will give items gathered 
from the Railroad Commission's records. Columns 1. 2, 3 and 5 are 
records, while 4. fi. 7 and S are computed from the former. The net 
earnings capitalized at 7% gives a valuation upon which these cor- 
porations pay a tax of approximately .fS.25 per thousand. A com- 
parison of the taxes paid with gross and net earnings shows a per cent 
of 4 and 10.49 respectively. Table Xo. 3 is taken from the report of 
the Commission of Inquiry and shows similar items with reference to 
steam roads. Table Xo. 4, taken from the same source, shows the rate 
per thousand tax upon different types of property in the state. In- 
spection of these tables confirms the belief that the corporations under 
consideration receive income from a value which is not reached under 
the present system of taxation. 
(b) What are other states doing in ihis field? An authoritative 
compilation of Ihe tax laws for the northern states, published in re- 
cent months by the Commissioner of Corporations, Department of Com- 
merce. becomes Ihe source of information for this topic. These reports 
authorize the following statements. 
First. There is no uniformity discernible in the method of taxing 
