People ex rel. Little v. St. Louis Elec. Bridge Co.

• Decision Date: 17 December 1919
• Docket Number: No. 12581.,12581.
• Citation: 290 Ill. 307,125 N.E. 280
• Parties: PEOPLE ex rel. LITTLE, County Collector, v. ST. LOUIS ELECTRIC BRIDGE CO.
• Court: Illinois Supreme Court

290 Ill. 307

125 N.E. 280

PEOPLE ex rel. LITTLE, County Collector,

v.ST. LOUIS ELECTRIC BRIDGE CO.

No. 12581.

Supreme Court of Illinois.

Dec. 17, 1919.

Application by the People, on the relation of George E. Little, County Collector, for taxes, to which St. Louis Electric Bridge Company filed objections. Judgment sustaining objections, and People appeal.

Affirmed.

Appeal from Circuit Court, Madison County; Otto W. Longenecker, judge.

Edward J. Brundage, Atty. Gen., Joseph P. Streuber, State's Atty., of Highland, and Clarence N. Boord, of Springfield, for the People.

Burton & Hamilton, of Peoria, and Terry, Gueltig & Powell, of Edwardsville, for appellee.

DUNN, C. J.

The St. Louis Electric Bridge Company filed objections in the county court of Madison county in 1917 to the application of the county collector for taxes assessed against its tangible property in 1916, amounting to $11,571.10. In 1918 it filed objections to the application of the collector in that year for judgment for $24,850 taxes extended against its capital stock on an assessment made by the state board of equalization in 1917. The two cases were heard together by agreement, judgments were rendered sustaining the objections, and the people have appealed.

The objection in each case was that the assessment was arbitrary and so unreasonable and grossly excessive as to be fraudulent. The appellee's property which was assessed consists of the part in Illinois of a bridge extending across the Mississippi river from Venice, Ill., to St. Louis, Mo., including steel trestle, wooden trestle, and real estate, which was assessed at $10,000. The bridge has been in use since the fall of 1910. In 1913 and 1914 the portion of the bridge in Illinois, with the Illinois real estate, was assessed at a full value of $420,000. In 1915 the assessor raised the full value to $1,050,000, but the board of review, upon a hearing, lowered it to $420,000. In 1916 the board of review, after notice to the appellee and a hearing, fixed the full value of the Illinois part of the bridge and the Illinois real estate at $1,086,000. The appellee paid the taxes due on the amount of the assessment of 1915, and it is the remainder of the taxes to which objection was made.

The part of the bridge in Illinois consists of 1,032 feet of steel bridge, 700 feet of steel trestle, and 650 feet of wood trestle-2,382 feet. That in Missouri consists of 1,032 feet of steel bridge, 2,868 feet of steel trestle, and 1,440 feet of steel approach-5,340 feet. The original contract price for the construction of the bridge was $4,711,000, but changes were made in the plans, reducing the cost to approximately $3,580,000, at which it was carried on the company's books. This price was paid, $1,000,000 in stock and the rest in bonds of the company, which were sold for 85 cents on the dollar, so that the actual money which went to the construction of the bridge must be reduced $387,000, making the actual cost of construction $3,193,000. Since the Illinois part of the bridge was somewhat less than one-third of the whole, an assessment based solely on the cost of construction could not exceed $1,064,333. The basis of assessment of all property in Madison county was 70 per cent. of the actual value, which would produce the amount of $745,033 as the assessed full value of the property, disregarding any question of depreciation or appreciation in value.

In November, 1914, the appellee procured an inventory and appraisement of the property to be made by two consulting engineers of St. Louis, and evidence was introduced on the hearing that the reproduction or replacement value of the bridge at that time was $2,657,112.94. The fact that the assessment was made as of April 1, 1916, 16 months later, when the prices of labor and material had changed, weakens the force of the evidence, but does not render it incompetent. There was also testimony at the hearing that at that time (1916) it would not cost to reproduce the portion of the bridge in Illinois more than $800,000. If this reproduction value of $2,657,112.94 were to be taken as the only only basis of assessment, the valuation of the Illinois third of the bridge would be $885,704, which on a 70 per cent. assessment would produce an assessed full value of $619,992. The assessment exceeded this amount more than 75 per cent.

In 1916 the gross income of the property from all sources was $367,831.50, taxes and expenses of maintenance and organization $85,965.26, leaving a balance of $181,856.24. In all previous years the net income had been less. Capitalizing this amount at 6 per cent. produces $3,030,937, one-third of which ($1,010,312) at 70 per cent. would make a valuation of $707,218 for the Illinois portion, based only on income.

All of the above facts are proper for consideration in making an assessment, but all of them together are not completely inclusive of the matters to be considered. The character of the property is such that it has no market value in the ordinary sense of that term. Testimony of experts was introduced that in their judgment a willing purchaser of the property would not give more than $1,000,000 or $1,250,000 for the property. The bridge was constructed for the use of the Illinois Traction System. It carries double railroad tracks and roadways for wagons and pedestrians. It is strong enough for steam railway traffic, but only electric power is...