Governor Oddie-Gentlemen, the board will come to order. I will ask the Secretary to call the roll. Upon roll-call of the Board of Revenue all answered present. Upon roll-call the Board of Assessors all answered present with the exception of Mr. Arrild of Douglas County, in whose stead Mr. Leo Springmeyer, Chairman of the Board of County Commissioners of Douglas County, appeared and answered present. Governor Oddie All are present except Mr. Arrild, and Mr. Springmeyer represents him. First is the report of the Committee on Order of Business. The report submitted, addressed to the Chairman of the board. is as follows: ORDER OF BUSINESS 1. Work Horses. 2. Saddle Horses. The Pullman Company. 19. 20. 21. 22. Wells, Fargo & Company. American Express Company. Railroads classified as follows: 1. Central Pacific Railway. Sidetracks of same. 2. Nevada and California (broad-gage). Sidetracks of same. 3. Nevada and California (narrow-gage). Sidetracks of same. Sidetracks of same. 4. Hazen and Fallon. Sidetracks of same. 12. Nevada, California and 13. Virginia and Truckee. Sidetracks of same. Oregon. Sidetracks of same. 14. Eureka and Palisade. Sidetracks of same. 16. Silver Peak. Sidetracks of same. 17. Caliente and Pioche, Sidetracks of same. 18. Atchison, Topeka and Santa Fe. Sidetracks of same. 19. Glasgow and Western Exploration Company. Sidetracks of same. 20. Pioche and Pacific Transportation Company. Sidetracks of same. 21. Nevada Copper Belt. Sidetracks of same. 22. Western Pacific. Sidetracks of same. 23. Miscellaneous Railroads. 24. Rolling Stock of all. H. M. LEONARD, Chairman, H. R. LEMAIRE, A. H. NORRIS, Twenty-four items. Now, before we take this up in detail, I would like to read a little statement I have made which may throw some light on the many complications in this assessment system. You know it is one of the hardest nuts to crack in the State, and I have given some comparative figures here that I think may be of some benefit. Each one of you may have a copy of this. This starts in with some fundamental principles. These figures are just used for comparative purposes, as there is no table in the State that we could use that shows actual figures : Taxation is the fundamental business proposition of any form of government. To conduct civil government, to maintain law and order, and to carry on cooperative institutions for the general welfare requires money, and that money is properly raised only by taxation. If it is a just government, the burden of taxation must be equitably distributed. No man should be compelled to pay more than his proper share of taxes, and no man should be permitted to pay less. These are axioms which no one will dispute. Their application presents many complex difficulties. I believe that Nevada is behind many other States in the solution of the problems of equitable taxation. Yet I believe that there is no other subject of such immediate importance to the people of this State as this. We have an ad valorem system of taxation on all property in this State. The tax rate is fixed by the State Legislature, and applies uniformly to all kinds of property, real, personal and possessory. Any inequality in the system of taxation, therefore, must resolve itself to inequality in the appraisement of valuation upon different pieces, kinds or classes of property. Sixty per cent of the cash value of all the various kinds of property in this State is popularly supposed to be the uniform basis of valuation for assessment purposes. It is a matter of common knowledge that, while residence property in the towns and cities is generally taxed up to this basis, as well the realty and improvements of small property owners in many instances, very little other property in the State is anywhere near so highly appraised. The testimony of the Assessors at the meeting of this board held on January 10, 1910, showed a range of appraisements from 35% to 60% of the cash value, and it is probable that the variation on close investigation will be found to vary within wider extremes than this, or to as low as 25%, at least on certain classes of property. It is interesting to note the effect on the taxpayer of such variations in assessment valuations. Not every one has given it due consideration, and few have worked it out by the proper method of computation. Let us assume, for purposes of illustration, that $100 is required to be raised by taxation, and that the real cash value of the property which must be assessed is $10,000. Let us further suppose that this $10,000 worth of property may be classified as follows: Residence property, actual cash value... $1,000 2,000 Railroad property, actual cash value.. 4,000 Industrial business property, actual cash value. 500 Public utility property, actual cash value... 1,000 Stock range and livestock property, actual cash value.... 1,500 Total actual cash value.. $10,000 Now, if this $10,000 worth of property be assessed at its full cash value in each instance, a tax rate of $1 on each $100 of valuation would produce the $100 revenue required. If the basis of valuation be 60% of the cash value, a rate of $1.66% on each $100 valuation will produce that amount of revenue. In each instance the amount of taxes the owners of each class of property would pay. and which may be termed the just amount each class should pay, would be as follows: The residence property would pay. The farm property would pay. The railroad property would pay. The industrial business property would pay. The stock range and livestock property would pay... $10 20 40 5 10 15 Total taxes paid.. .$100 But let us suppose that, instead of a uniform system of valuation applied to each such class of property, the basis of valuation in each instance varied as follows: $1,000 residence property, assessed 60% of cash value...... $600 500 $4,000 railroad property, at 30% of cash value.. 1,200 250 $1,000 public utility property, at 25% of cash value..... 250 $1,500 stock range, etc., property, at 30% of cash value.... 450 Total assessment valuation........ ..$3,250 To realize $100 in taxes on $3,250 worth of property, the rate will have to be $3.08 on each $100 valuation. Now, let us see what the result is to the taxpayer. The residence property, on a uniform system of valuation, should only be required to pay $10 taxes, but under the above system has to pay $18.48 taxes, or 84.8% more than is its just proportion. The farm property, on a uniform basis of valuation, should pay $20 taxes, but under the above system pays $15.40, or 23% less than is its just proportion. The railroad property, on a uniform system of taxation, should pay $40 taxes, but under the above system pays $36.96, or 7.6% less than is its just proportion. The business property, on a uniform basis of taxation, should pay $5 taxes, but under the above system pays $7.70, or 54% more than is its just proportion; and The stock range and livestock property, on a uniform basis of valuation, should pay $15 taxes, but under the above system pays $13.86, or 7.6% less than its just proportion. It is not difficult to discover who is benefited and who is injured by such a system. Moreover, if one wanted to reform the system, those who were particularly benefited by the existing system would naturally not be extremely anxious for any change. It is clear that on such a system of taxation as presented, the basis of valuation is not 60% of the total cash value of the property to be assessed, but is precisely 32.5%, and that all property returned for assessment purposes at a higher rate is paying an undue proportion of the cost of government and all that is assessed at less than 32.5% of its cash value is paying less than it should. I am not claiming that these classifications of property valuations, with respect to assessment valuations and relative valuations, are entirely accurate with respect to our taxation system in Nevada, but I believe that they approximate the facts close enough for the taxpayer to draw some valuable conclusions. I took the stand at the time the Legislature was in session, and I have not since found reason to change my opinion, that the enforcement of an impartial and uniform system of valuing property for assessment purposes in this State would result in supplying the funds necessary to maintain our state and county governments without serious hardship on any one; would, in fact, lessen the existing burden on the residence property owner and the average business man and not very seriously affect those who are delinquent. I advocated the passage by the Legislature of a bill which I believe would have given us in a short while one of the most perfect taxation systems, if not the best, in this country. It failed to pass the last session, but in spite of that fact, that bill or some better bill is bound to receive attention at the next and succeeding Legislatures, unless in the meantime the State Board of Assessors discovers the way to give the State a uniform system of valuation of all kinds and classes of property throughout the several counties. Taxation is a business proposition. It is not a partisan political question in any sense of the word. On the other hand, it is a question on which those who are getting the best of the inequality of the existing system, whose property is undervalued, will be found lined up in active opposition to any change. My mind is open on the subject of what is best to be done to accomplish the result of equalizing property valuations. The best, surest and simplest way to get that result is what I want to bring about, if possible, and is what the public wants. If the State Board of Assessors at this meeting can meet the situation in a way to show its competence to arrive without too great delay at the result desired, I shall be most happy, and in any way that I can be of aid or assistance I can do so with the sincere and profound wish for the success of this meeting. There is a little food for thought in that, gentlemen. It figures things on a little different basis than they were ever figured before that I know of, and before we get through we will all see it a little clearer. What we want is a discussion, when we come to those various items, and see if we can't get a system here that every State will try to follow before we get through. Attorney-General Baker-It is customary to read the various sections of the law under which we are proceeding. If it is so desired I will do so now, and if not it can be dispensed with-whatever is the pleasure of this meeting. Governor Oddie-The law was read at the last meeting, and I think we all know it pretty well. What is your pleasure about it, gentlemen! Mr. Leonard-There are a couple of new members here this time. Governor Oddie-Do you think it would be a good plan to read the law, Mr. Leonard? Mr. Leonard Not for my benefit. Attorney-General Baker-Mr. Grutt is a new member. Mr. Miles-I would suggest that the law be read and also the item which designates just what the cash value is under our state law. Governor Oddie-Will you read that please, Mr. Baker? Attorney-General Baker-The law creating the State Board of Assessors was passed and approved March 13, 1903. The Act is entitled: An Act to amend an Act entitled "An Act to provide for a more uniform valuation and assessment of property in this State," approved March 16, 1901: Section 1. The County Assessors of the several counties of this State shall meet for a period not exceeding ten days in the office of the Governor, at Carson City, Nevada, on the second Monday in January of each year, and shall at such meetings establish a valuation through the State of all railroads and rolling stock of such railroads, of all telegraph and telephone lines, of all electric light and power lines, of all cattle and sheep, and upon all other kinds of property which in the judgment of said Assessors can be valued and assessed more uniformly by said Assessors acting collectively, than by the several County Assessors acting separately; provided, that in fixing such valuation the location and situation of such property shall be considered; At this point Deputy Attorney-General Judge entered and handed Attorney-General Baker a legal volume. Attorney-General Baker-This is the new Compiled Laws-I guess the first one that has been gotten out. I had to send the State Police to get it, but they finally managed to get one. I will turn to the section on revenue. (Continues reading) : and, provided further, that nothing herein shall be construed as to impair the right of the Board of Equalization of any county to equalize taxes on all property, the valuation of which has not been fixed at the annual meeting of the County Assessors as provided in this section; but the said County Board of Equalization shall not have the power to equalize any property upon which a valuation has been placed by the said Board of County Assessors; provided, any taxpayer under the provisions of this Act shall not be deprived of any remedy or redress in a court of law relating to the payment of taxes. Sec. 2. At such meetings the Governor shall be the Chairman and the Governor's Secretary shall be the Clerk. The Governor shall have the casting vote in case of a tie. The State Controller shall supply all information and data concerning the finances of the State, either on his own motion or by request of the board. Eight Assessors shall constitute a quorum for the transaction of business, and a majority of the entire board shall decide any question before the meeting; provided, that in case of a tie on any question before the board, the Chairman shall cast the deciding vote; and it is hereby made the duty of every Assessor present at the meeting of said board to vote aye or no, upon every question put by the Chairman of said meeting, and every Assessor failing to do so shall forfeit his office and shall be proceeded against by the District Attorney of said Assessor's county, at the request of the Attorney-General, to enforce said forfeiture; provided, that, if at any meeting the Assessor of any county shall, by reason of sickness or other unavoidable cause, be unable to attend any such meeting, then, in that event, the Chairman of the Board of County Commissioners of such counties shall attend such meeting, and shall act and vote in the place of such absent Assessor, with the same force and effect as such Assessor might do if present, and the Governor or acting Chairman of said meeting shall be and hereby is authorized to issue a subpena for the attendance of any Assessor who shall fail to attend, unless excused by the provisions of this Act. And he is hereby further empowered to deputize anyone who is qualified by law to serve a summons to serve the same; and provided further, that, if at any meeting the Governor or his Secretary shall, for any reason, be unable to act as Chairman or Clerk, then, in that event, the State Controller shall act as Chairman, and in case the State Controller shall also be absent, then the Attorney-General shall act as Chairman and as such Chairman shall have all the powers herein granted to the Governor acting as such Chairman. Any Assessor who shall fail to attend the meeting provided for in Section 1, unless he is prevented by sickness or other unavoidable cause, shall be subject to a penalty of $500, to be collected in a suit instituted against said delinquent Assessor or his bondsmen by the District Attorney of the county of said Assessor, on the request of the Attorney-General; and shall be further subject to removal from office, should a majority of the State Board of Revenue hereinafter created order proceedings to that effect to be instituted. Sec. 4. The valuation fixed at such annual meetings shall be the actual cash value Attorney-General Baker (addressing Mr. Miles)-Mr. Miles, is that the actual cash value you referred to Mr. Miles-What I wanted to get at was what was considered the actual cash value-how it is determined. Attorney-General Baker-I will go into that with you later. (Continues reading): of all such property as may be designated, as now provided by law, taking into consideration the locality of such property, and the Assessors of the several counties shall assess and enter upon the assessment rolls of their respective counties all such property at the valuation designated by such meeting of County Assessors, and shall fix the value and assess all property not so valued at said meeting in the manner now provided by law. Sec. 5. The valuation fixed at such annual meetings shall be uniform on all property as may be designated, except in such cases where the value is affected by its locality or other consideration affecting its cash value; and the Assessors of the several counties of the State shall fix values on all property not so valued at said annual meeting, in the manner now provided by law. Sec. 11. It shall be the duty of each County Assessor to fix the valuation of all property which may be assessed by him at the valuation placed upon the same kind of property at the regular annual meeting of the Assessors for the State. Sec. 13. Should any Assessor in this State neglect to assess property in accordance with the provisions of this Act, or laws now in force and effect, or place a greater or less valuation on any property than has been fixed at said meeting of Assessors, the State Board of Revenue, which is hereby created, consisting of the Governor, State Controller and Attorney-General, shall instruct the District Attorney of said Assessor's county to bring suit against such Assessor and his bondsmen for the sum of five hundred dollars as a penalty therefor, which said sum, when collected, shall be paid into the General Fund of the State Treasury, and such board may instruct the Attorney-General to request the District Attorney of said Assessor's county to institute suit against such Assessor for his removal from office for such neglect or refusal. The suit shall be tried in the District Court having jurisdiction in the county where property is situated. Mr. Hayes-I would like to ask you, Mr. Baker, what you understand by "uniform valuation." What does it apply to? Does it apply to all the property of a railroad in the different counties where the railroad |