HEARINGS

LAW LIBR

APR 1 2 1966

BERKELE

UNIVERSITY OF

BEFORE THE

COMMITTEE ON

INTERSTATE AND FOREIGN COMMERCE HOUSE OF REPRESENTATIVES

EIGHTY-NINTH CONGRESS

SECOND SESSION

ON

H.R. 4972

A BILL TO AMEND THE INTERSTATE COMMERCE ACT, AS
AMENDED, IN ORDER TO MAKE UNLAWFUL, AS UN-
REASONABLE AND UNJUST DISCRIMINATION AGAINST
AND UNDUE BURDEN UPON INTERSTATE COMMERCE,
CERTAIN PROPERTY TAX ASSESSMENTS OF COMMON
CARRIER PROPERTY, AND FOR OTHER PURPOSES

COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE

HARLEY O. STAGGERS, West Virginia, Chairman

W. B. WILLIAMSON, Clerk

KENNETH J. PAINTER, Assistant Clerk

Professional Staff

Conlon, Charles F., executive secretary, National Association of Tax
Administrators.

78

McDowell, Robert O., attorney for the Property Valuation Depart

ment, State of Kansas...

116

Ogden, James N., representing the Association of American Railroads. 10, 72 Peters, William E., State tax attorney, Lincoln, Nebr..

121

Roncalio, Hon. Teno, a Representative in Congress from the State of
Wyoming..

Sanders, Paul H., professor of law, Vanderbilt University School of
Law.

Travis, Broley E., consulting valuation engineer, Sacramento, Calif..
Waggonner, Hon. Joe D., Jr., a Representative in Congress from the
State of Louisiana.......

Additional material submitted for the record by

American Trucking Associations, Inc., letter from W. A. Bresnahan, managing director..

146

Arkansas Public Service Commission, statement of Earl Berry, director, tax division__

91

Association of American Railroads:

Appendix A-List of 20 States wherein excessive ad valorem
taxes are levied (table)...

Exhibit No. 1-Letter from, and background material on, James
W. Martin..

Exhibit No. 2-Background material on Dr. Harold M. Groves__.
Exhibit No. 3-Letter from, and biographical sketch on, Maj.
Gen. John P. Doyle_-----

States wherein tax cases were settled with decisions adverse to
railroads, not affording material relief, or litigation is still pend-
ing---

110

Avery, Gov. William H., of Kansas, letter from.
California State Controller's Office, letter from Alan Cranston____
Dworak, George J., Nebraska State tax commissioner, statement of__
Groves, Dr. Harold M., statement of..

Iowa State Tax Commission, statement of Lynn Potter, chairman__.
National Association of Tax Administrators, list of States wherein
there has been recent litigation involving ad valorem tax assess-
ments...

North Dakota State Board of Equalization, Lloyd Omdahl, secretary, statement of..

101

141

Oregon State Tax Commission, letter from C. H. Mack, chairman__ Peters, William E., State tax attorney, Lincoln, Nebr., supplemental statement of__

144

123

South Dakota State Department of Revenue, statement of

139

Speer, John B., New Mexico State Tax Commission attorney, letter from...

143

118

142

122

44

125

Additional material submitted for the record by-Continued
Springer, Hon. William L., a Representative in Congress from the
State of Illinois:

Public notice from the Illinois State Journal and Register, listing
1963 fair cash valuation of railroad property (table) -
Public notice from the Southern Illinoisan listing 1964 fair cash
valuation of railroad property (table)__

Section 561, chapter 120, Revenue Code, 1965 Illinois Revised
Statutes__

Tennessee Public Service Commission, statement of, presented by
Eugene W. Ward, general counsel..

Transportation Association of America, letter from Harold F. Ham-
mond, president_

Washington State Tax Commission:

Letter from George Kinnear, chairman_

Ratio comparison, 1960 through 1965 (chart) –

Wyoming State Board of Equalization:

Exhibit I-Chapter 11-A-Ad valorem tax assessments by the
board_

Exhibit II-Excerpts from minutes with reference to Chicago,
Burlington & Quincy assessments since 1924_.

Page

34

36

37

140

146

145

145

123

M

Exhibit IV-Comparison of railroad assessments in Wyoming,
1955-65 (table)....

Exhibit V-Assessed valuations of class I railroads in Wyoming
since 1930 (table) -

Exhibit VI—Percentage changes in ad valorem assessed valuation
of various types of property in Wyoming, 1962-65 (table) -
Exhibit VII-Chicago, Burlington & Quincy Railroad better-
ments and/or additions (table).

Exhibit VIII-General Order No. 2, 1962-Buildings and/or
structures..

Exhibit IX-General Order No. 2, 1966-Inventories - -
Exhibit X-General Order No. 3, 1966-Used motor vehicle and
farm machinery inventories..

Exhibit XI-General Order No. 4, 1966-Personal property-
Exhibit XII-Assessed valuations of four major railroads in
Wyoming in percentages of 1930 assessments (chart) _ _ .
Exhibit XIII-Assessed valuations of four major railroads in
Wyoming since 1930 (chart) –

Statement of...

Exhibit III-Chicago, Burlington & Quincy Railroad tonnage
handled each year, 1933-63 (table) -

123

131

132

133

133

133

134

134

135

136

137

138

126

TAX ASSESSMENTS ON COMMON CARRIER PROPERTY

TUESDAY, MARCH 1, 1966

HOUSE OF REPRESENTATIVES,

COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE,

Washington, D.C.

The committee met at 10 a.m., pursuant to call, in room 2123, Rayburn House Office Building, Hon. Harley O. Staggers (chairman) presiding.

The CHAIRMAN. The committee will come to order.

The committee this morning is opening hearings on 13 identical bills, starting with H.R. 4972, introduced by our colleague, Mr. Rogers of Texas.

(The identical bills are: H.R. 5074, H.R. 5310, H.R. 5375, H.R. 5425, H.R. 5656, H.R. 7183, H.R. 7313, H.R. 7589, H.R. 7917, H.R. 8238, H.R. 8763, and H.R. 9450.)

The CHAIRMAN. The purpose of the bill is to declare that it is an unreasonable and unjust discrimination against and an undue burden upon interstate commerce for a State to assess a valuation on carrier property at a rate higher than it assesses all other property in the State, and collaterally, to provide a remedy in the Federal courts for carriers against the collection of a tax based on an unlawful assessment.

(The bill referred to, and departmental reports thereon, follow :)

[H.R. 4972, 89th Cong., 1st sess.]

A BILL To amend the Interstate Commerce Act, as amended, in order to make unlawful, as unreasonable and unjust discrimination against and undue burden upon interstate commerce, certain property tax assessments of common carrier property, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Interstate Commerce Act, as amended, is amended by inserting after section 25 thereof a new section 25a as follows:

"SEC. 25a. (1) The following action by any State, or subdivision or agency thereof, whether such action be taken pursuant to a constitutional provision, statute, or administrative order or practice, or otherwise, is hereby declared to constitute an unreasonable and unjust discrimination against and an undue burden upon interstate commerce and is hereby forbidden and declared to be unlawful: (a) the assessment, for purposes of a property tax levied by any taxing district, of property owned or used by any common carrier subject to this Act engaged in transportation of persons or property in interstate commerce at a value which bears a higher ratio to the true market value of such property than the assessed value of all other property in the taxing district subject to the same property tax levy bears to the true market value of all such property; (b) the collection of any tax on the portion of said assessment so declared to be unlawful.

"(2) Notwithstanding the provisions of section 1341, title 28, United States Code, or of the constitution or laws of any State, the district of the United States shall have jurisdiction, upon complaint and after hearing to issue such writs of injunction or other proper process, mandatory or otherwise, as may be necessary to restrain any State, or subdivision or agency thereof, or any person from