UNI USD STATES DSPiiEOMElfj; 01 AGRICULTURE Bureau of Agricultural Economics TAXATION OE RESTED FARMS - 1919 A. Preliminary Report CONTENTS Page Introduction : 1 Relation of property Taxes to Cash Rent of Earn Real Estate 3 Sale Value a? the Pasis of Real Estate 'Taxation .• 7 Relation of Taxes to Rent of Urhan Real Estate ..J. 11 Distribution of Property Taxes According to Levying .jurisdiction and Purpose 13 Appendix 18 Ysashington, D. C- March, 1925. Digitized by the Internet Archive in 2013 http://archive.org/details/rentedfarmsOOunit FABIS, 1919 £y C. 0- Brannen, Associa.te Agricultural Economist, and J. T. Sanders, Assistant Agricultural Sconomiat, Bureau of Agricultural Economics. The Fation's development has teen marked by growth in govern- mental expense. In earlier days taxes were levied mainly for the pur- pose of maintaining law and order. Since that time public education, public health, public highways and various other activities formerly undertaken at private expense, have become functions of government. In addition, most of the older established functions have been expanded and broadened to meet the growth of population and wealth and the conse- quent development of a more complicated economic society. Underlying this movement has been the growing belief that more and better services may be had at less cost by collective spending and that all the people should have the benefit of certain advantages necessary to the advance- ment of the Nation. This is the normal development of the progressive community. In- creased demands for public service cannot be satisfied, however, without increased taxation. The evidence of this is to be seen on all sides. Total tax revenues in the United States increased from 1913 to 1922, from slightly less than four billion to almost eight billion dollars, or 198 per cent. 1/ A considerable part of this increa.se in taxation, of course, resulted from the late war. Put it is estimated by the Bureau of the Census that State and local taxes increased 115 per cent during the same period and that the general property tax, which is the chief source of State and local revenues, increased 160 per cent in the ten-year period. The expansion in governmental activities with the accompanying increase in public expenditures, however, is not the problem with which we have to deal. This tendency appears in the development of all civil- ized countries. Occasional reductions in the volume of taxes may appear, \J Report of the Census, 1922. - 2 - yet in the long run further increases in taxation may be expected. While tax reduction alone will not solve the problem of inequitable taxation, it is always advisable to consider the possibility of retrenchment. The pri- mary problem, however, is to bring about a more equitable distribution of the public burden on all classes of property and all taxpayers. Under our multiple system of government the relationship of the in- dividual to the State and to the minor governmental subdivisions is complex. In view of this complexity and the variety of special forms of taxation which have in part supplanted earlier uniform methods, a statistical measure- ment of the relative tax burden or of the tax obligation has become increas- ingly difficult. In fact, it may be questioned whether an accurate statis- tical measurement is ever possible, but statistics may be employed in a very general way to indicate the tax situation of certain broad groups of tax- payers. The problem of State and local taxation, particularly as it relates to farmers, hinges very largely on the methods of general property taxation, for most of State and local revenues are derived from the general property tax. Of all tax revenues in the 48. States in 1922, 8" per cent crme from this source. The dependence on general property taxes as the chief source of revenues varies somewhat with the States, as shown in Table 1 of the Appendix. In Texas general property taxes represented 96.3 per cent of all tax revenues, and in Delaware they represented 55.9 per cent. There are two generally accepted viewpoints frcm which taxation may be considered. It may be considered as personal in relation to the indi- vidual's personal ability to pay, or it maybe considered as objective in relation to business or property earnings. The amount of taxes paid in the first case should be considered in the light of its effect on the total in- come of the individual and the personal sacrifice made because of the tax. The amour t paid in the second case is to be considered in its effect on the business venture, although any tax is in a measure personal and is sure to result in some degree of sacrifice . In view of the fact that the tax on real estate under the general, tax system has become, in practice, a tax on property as such, we may con- sider this part of the farmer's total tax in relation to farm real, estate earnings. The defects of the general property tax system are well known. The tax is based on capital value, irrespective of either personal or prop- erty incomes. A tax of this nature applied uniformly to practically all classes of property will affect the earnings of one class more than another. Tor example , one class of property may yield an average rate of return of 10 per cent while another yields 2 per cent, yet the tax based on sale value may be the same. If the tax is equivalent to one per cent of sale value, it might absorb 10 per cent of the income in one case and 50 per cent in the other. Besides, there are varying degrees of difficulty in reaching differ- ent classes of property for taxation by this method. The greater the extent to v,hich this is tiue, the greater will be the inequality in taxation in re- lation to income or earnings. Tor these and other reasons State and local taxation operates to the peculiar disadvantage of farmers. - 3 - The purpose of the present study has "been to determine for the year 1919 the relation of State and local property taxes on real estate to farm real estate • earnings. The real estate tax is compared with income from rent of farms rented for cash in selected areas. Data for o wr exonerated farms have not been included because of the greater difficulty of obtaining the earnings of farms operated "by their owners. Earnings of land "based on cash rent are considered representative of , land income at a given time in communities where cash rent is prevalent.—^ Eor comparison with the tar on farms, data, were collected in a few of the counties to show the relation of taxes to rent of urban real estate. Analyses were made to indicate the proportions of the tax levied by the State, by the county and by local governmental agencies, ard to show the major purposes for which such taxes were levied. A total of 3,221 farms in 31 counties in 25 States are included in the study. The number of acres is shown in Table 1. The counties selected for study are considered fairly representative of the agricultural sections in which they are located, although some of them may be slightly above the average for the State as a whole. In size, extant of improvement, average value per acre, and the percentage of the total value of real estate in im- provements, as shown in Table 2 of the Appendix, the selected farms are generally representative of ail farms in the county. Relation of P rop erty Taxes to Cas h Rent of Tarm Real Estate •Property taxes, State ard local, absorbed in 1919 a large part of the net rent of farms in most of the counties included in this survey. This was true even though in that time rents were relatively high and taxes relatively low. Since 1919 rents have -declined and taxes have increased. Though the percentage of rent used in the payment of taxes was rather large in -most of the areas, yet it was much higher in some than in others. (Table 1; The tax e^ressed in percentage of net rent was highest in the Middle Atlantic and seme of the Western States and lowest in the Southern States. In general this percentage for the Uorth Central and Rocky Moun- tain States fell "between thess extremes. 2/ In selected counties surveys were made of all cash- rer ted farms of ten or more cultivated acres as reported by the census of 1920. Where there was evidence of kinship "between: landowner and tenant or where the data were other- wise inadequate for this purpose, farms vvere not included. Erom census rec- ords were taken the mmfber of acres, cash rent paid in 1919 and valuation of land and improvements. The number of acres, a-ssessed valuation, taxes levied as of 1919, and other necessary information were obtained from official rec- ords by personal visit to the county. Special assessments and acreage taxes for drainage or levee were not included in the tax statistics. The study was made by the Division of Agricultural Einance and the Di- vision of Land Economics, Bureau of Agricultural Economics. 3/ To ascertain net rent before taxes were paid, allowance was made for depreciation and repairs and for insurance of farm buildings. In making the deduction for depreciation and repairs, the annual rate of depreciation and Table I. Relation of Taxes to Net Cash "Rent cf Farm Real Estate Per Acre and Percentage of Pent Absorbed by Taxes, 1913. : Net rent : Relation of State : per acre : Tax : taxes to and : Far m s [1 : (before : per : Net Rent County : deducting . : . Acre : (before deduct- : taxes') ing taxes) : Number : Acres : Dollars : Dollars ! Per Cent New York - Delaware : 137 : 20,794 r 1.23 : ' .38 : 30.9 - Niagara : 66 : 6 , 170 : 2.75 : .85 : 30. 9 Pennsylvania - Chester : • 177 . • : 13,525 :' 1-- 83 • :•• 1.20 : 65.6 Ohio - Franklin : 90 : 7,279 : 6.30 . : 1.41 : 22 . 4 Indiana -■ Tipton : 77 6,293 r. . 9.38 . 1.41 : 15.0 Illinois - Macoupin : • 79 ; • 7 , 510 i : '. .64 : 18.2 Michigan - Lenawee : 111 : . ■ 8,863 4.40 : 1.67 : 38.0 Wi scon sin - Dane : 106 : 11,553 : 3. 98 ; 1.18 : 29. 6 Minnesota - McLecd : ■ .87 : 12,245 :• 3.49 : .85 : 24.4 south Dakota - Moody : 128 : 29,475 4.76 • . ,. .77 : 16.2 Iowa - Union : 113 : 16,094 : 5.29 : .84 : 15.9 - Story 100 : 14,217 : 7.28. . : 1.37 : 18. 8 Nebraska - Wayne 88 16,161 5.74 : .67 : 11.7 Kansas - Sutler 155 42 , 787 1.73 .41 :- 23.7 Virginia - Southampton 36 5,032 • 1 . 96 .11 : 5.6 North Carolina - Halifax 161 29,235 2.08 . 13 6.3 Georgia - Bleckley 150 14,810 : 2.94 . : .22 7.5 Alabama - Montgomery ; 181 7,383 : 2.41 . 17 7.1 Mississippi - Tunica t 101 ; 6,810 : 14 . 24 : 1.61 11. 3 Tennessee - Rutherford 95 7,684 ; 3. 14 : .24 ; 7.6 Arkansas - St. Francis ' 37 3 2, 561 : 5.11 ' : ,53 : 10.4 Oklahoma - Payne 196 - : 26,209 : 1.30 : .38 . . 29 . 2 Colorado - Delta 57 3,899 : 4.04 .96 : 24.0 - Otero : 52 : Cj i ^ 1 3 12.63 : 2.19 : 37.4 Utah - Salt Lake : 28 . 987 : 9.81 : 2.82 : 28.7 Idaho - Ada ; 66 : 3,032 : 10.02 2.85 : 28.4 - Madison : 32 : 2,582 : 11.31 : 1.75 | 15-6 Oregon - Washington : 115 : 11,880 ! 4.34 : 1.64 : 37 . 8 California - Sacramento : 130 : 11,814 : 10.49 ; 1.36 : 13.0 - Merced : 118 12,091 : 9.78 : 1.63 : 16.7 Arizona - Maricopa 132 ; 11,155 : 26.^1 ; 2. 61 : 9.8 / 1 Acreage is that appearing on the tax record, which is not always identical with census acreage shown in Table 2 of the appendix. The relation of taxes to rent .will, of course, vary- in different places depending upon economic as well as tax conditions. It is not pos- sible to explain all of these conditions, hut the extent to which- the data shown for different areas lack comparability may be pointed out. This will explain in part the different percentages shown for the counties sur- veyed. In the Southern States the so-called rent includes not only real estate rent, but returns for management and risk. The percentages shown for Southern counties, therefore, are lower than they would he if the rent proper could have "been accurately determined. In dairying or trucking sec- tions where most of the land is operated hy owners, the rent charge on the few farms that happen to he leased is likely to he nominal. Also in sec- tions where farms are over-improved, that is, where the value of farm buildings is more than is ordinarily required for farm needs, the net rent is less than it otherwise would he because of the larger deduction made for depreciation and insurance, while the landowner in such cases probably re- ceived no rent for improvements in excess of farm needs. In Chester County, Pennsylvania, the value of improvements was ap- proximately half of the total value of real estate, and the deduction made for depreciation and insurance was over half of the gross rent. It is for this reason, in part at least, that the percentage shown for Chester County, and for other counties where similar conditions prevail, is higher then in other counties. The net income of the selected farms, and the percentage of the rent required in the payment of taxes, may thus be higher or lower than the average for the areas studied, according to the effect of such special conditions. The results of the study should be considered as broadly indicative of the relation of taxes to real estate earnings rather than as conclusive evidence that an exact percentage of earnings is re- quired in the payment of taxes in any particular county. The relative amount of the tax on farm- real estate under the pre- vailing system of State and local taxation may be affected hy any of the following factors: (1) Exemption of farm real estate, (2) classification of property for taxing purposes, (3) percentage assessment of farm res,i estate as. compared with other classes of property, (4). degree of dependence upon property taxes for State, county and local revenues, (5) the extent of development of public improvements as affecting the volume of expenditures, repairs on farm buildings ascertained in farm management and cost of pro- duction studies made by the "J. S. Department of Agriculture in the various States was applied to the census valuation of improvements on 'the farms studied. lor the cost of insurance, the current rates of insurance in the dif- ferent States, ascertained by the Department of Agriculture, was applied to three-fourths of the census valuation of improvements, which allows a con- servative reduction for the cost of insurance. In any case the margin of error is small, since this item of expense is relatively unimportant in most are^s. The rates used for depreciation and repairs and the average rate of insurance from 1916 to 1920 are given for the several counties in Table 3 of the appendix. - . - 6 - (6) the extent to which other classes escape taxation under the general property tax system, and (7) the use of sale value as the only tasis of real estate assessment. Farm real estate included in this report enjoyed no exemption from taxation of any consequence. In South Dakota, dwelling houses occupied by owners were exempt in 1919 to the extent of $500, although such exemption did not apply in case of rented farms. In Indiana, 50 per cent of the mortgaged value of farm real estate was subject to exemption not to exceed $1,000 (Table 5 of the Appendix). To the extent that other classes of property are exempt, land may be expected to bear a heavier tax. The classif ica.tion of property for different rates of assessment under the general property tax had no influence on the amount of the tax, except in the Minnesota county, where farm real estate was a.sscssed at one- third of "full value," while certain other classes of property were assessed at a higher percentage. The legal provision in certain States for assessing all property at only a part of the actual value, as, for example, in Iowa, Illinois and Alabama, had the effect of reducing taxes on real estate in so far as public revenues were derived from sources other than the general property tax. The policy or practice of disregarding legal requirements and assess- ing property at varying percentages of actual value certainly has its ef- fect on the amount of the tax in individual cases but whether farm real es- tate in the aggregate bears less tax thereby is a debatable question. low valuations are accompanied by high rates of levy, and the practice of par- tial assessment affords greater opportunity for inequality all around. A greater degree of equality is probably attained under the classified prop- erty tax with thorough assessment of all classes of property at full value, provided the percentage of value to be taxed for different classes follows earning capacity. The state of a county's development in public improvement reflects to a considerable extent the amount of public expenditure and likewise the amount of the real estate tax. Good roads and modern school buildings ac- count for a large part of such tax, since the revenues for such purposes are erived usually from local taxation. No great difference can be seen in this respect as between older and more newly developed counties. In the °h v countie s considerable improvement may have been made in the past, which m many cases now has to be done over, whereas in newer settled coun- ties such improvement is just now xmier way. The chief difference exists as between the county that is making large expenditures for roads and schools, either initial or replacement, and the county which is not making such ex- penditures. amoun ' t of t5le tax on farm property may also be higher in one State than another depending upon the extent to which schools, roads and similar public services are financed by means of local taxation. The effect of this factor was not determined for the counties surveyed. The tax is likely to be less than it would be otherwise, however, where the State de- rives considerable revenues from sources other than the general property tax. - 7 - Only three States included in this report, New York, Pennsylvania and California, levied in 1919 no property tax for State purposes.!/ In these States the ratio of tax to both census valuation and cash rent was comparatively high. This situation may have resulted from the greater public expenditure -rather than from a disproportionate tax on real estate. In certain other States that rely on other sources of revenue for State purposes, such as Ohio, Minnesota, Virginia, North Carolina, and Alabama, taxes on farm real estate appeared more favorable in comparison with cen- sus valuation and cash rent, but since State revenues constitute only a minor part of total revenues, absence of the State tax, as a rule, has a minor effect in reducing taxes on real estate. Whether little or no State property tax levy gives comparative re- lief from taxation depends upon the extent to which the State distributes revenues from other sources in support of local institutions and facili- ties, such as schools and roads. If such local functions are supported by local taxes, no large measure of relief will be felt by real estate merely by eliminating the taxation of real estate for State purposes. The collection of occupation and business taxes by counties, a char- acteristic of the local systems of taxation in some of the Southern States, probably has some effect in reducing taxes on land in Southern counties. It has always been the case that while many other classes of prop- . erty escape assessment, real estate never does. As the administration of the general property tax becomes more effective in the assessment of real estate, it becomes perhaps less effective' iri reaching many classes of per- sonal property. If all other classes of property subject to the tax were assessed with equal efficiency as real estate, the tax on real estate would probably be reduced in most of the States by a very substantial amount. Sale Value as the Basis of Real Estate Taxation farm real estate is assessed for taxation by State and local govern- ments on the basis of market or sale value. Sale value of land has been defined as "nothing but the capitalized value of net profits ordinarily de- rived from its use." I/. As expressed by another writer, the value to be assigned to a given tract of land depends upon (1) the income which the land yields at a given time, (2) the anticipated increases or decreases in this income, and (3) the rate of capitalization of such income. §/ It is evident from these definitions that there are two primary elements in the 4/ In New York the State levied a property tax for schools which was prac- tically offset in the two counties studied by apportionment of State funds for schools by the State Commissioner of Education in accordance v/ith the provisions of the education lav?. See article 4, section 71, of the Tax Law of the State of New York, 1920. 5/ Seligman, E. R. A., Incidence of Taxation, 4th Edition, p. 262. 6/ Chambers, C. R. , Relation of Land Income to Land Value, U- 3- Depart- ment Bui. No. 1224, p. 28. - 8 - value of real estate, its annual or use' value and its speculative value. If it is assumed that the income is entirely of a monetary^ nature , the im- portance of each of these elements may he approximately measured. The cap- italized annual rental'may he used to represent the annual value, and cen- sus valuation may he used to represent the comhined annual and speculative value., that is, the selling price. The difference "between census valuation and the capitalized annual rental hy this method would represent the part of sale value which is "based on expected increase" or decrease in income. The current' long-term mortgage rate of interest may he used in cap- italizing net cash rental, for it is assumed tha't the ^ farmer as a rule has the alternative of selling his farm and investing the proceeds in such mortgage securities. ^> : When using this rate' as reported hy the census- for capitalizing annual rental, it is found (Tahle 2) ; ••that a relatively - small percentage of census valuation is represented hy annual' ' income. ' v The capitalized rental in only one of the 31 counties was more -than a hundred per cent of census valuation. Outside the southern and a few of the western States it was 50 per cent or less. In southern, counties, except Payne County, Oklahoma, the capitalized cash rental was more than 50 per cent of census valuation, al- though the rental in this region is " in part a -return for 'management and risk. In fact, in the majority of cases', annual -rental accounted for less than half of the valuation reported "by" the census and- in 15 of the 31 coun- ties it accounted for less than -two -fifths. The low figure of 10.5 per cent shown for 'Chester- County, Pennsylvania,' might have heen due to the relatively low average rate of return on cash- rented farms as compared with all farms in the county, or to the greater deduction made from rent for de- preciation and insurance on excess improvements. It is also possihle that the farms surveyed in Chester County were not representative for other reasons. : .;' " ... . . ' u : In the middle western couhties, where capitalized annual rental per- haps more accurately reflects real estate earnings, less" than half of the census valuation of 1920 according to this method of calculation, is assign- ahle to current income at that time (Table 3). The remainder may he con- sidered as "based on the mere expectation that rents would increase at some future time. " r: '- " •' " - This means that the greater part of the sale value of these farms m 1919 was "based-on the expectation that rentals would -increase. This ex- pectation has not heen realized. Instead of increasing, rentals have' heen meterially reduced, in some cases as nnich as 50 per cent. A recent study of Jmore. than 100 farms in Indiana shows rents from "1919 to 1923 to have de- clined 'from $7. 49 to $4.25 per acre, xvhile the tax increased from 90 cents to $1.41 per acre. 2/ U Department Bulletin cited above,- pp. 42-45. 8/ press release of the Department of Agriculture dated March 25, 1924. - 9 - Table 2. Capitalized Net Cash Rental Compared with Census Valuation, 1919. : Capitalized Census : Capitalized State : net cash : Valuation : net cash and : • rental -* : per : rental in per County : per acre : acre : cent of census valuation Dollars : ■ Dollars : Per cent New York - Delaware '"; : "16.35 : 28.57 : 57.2 - Niagara r ' " 35. 19 i . 110.31 : '31.9 Pennsylvania - Chester : : 12.12 :' 115.71 : 10.5 Ohio - Franklin ' " 82.88 : 194 . 67 : 42.6 Indiana- -■ Tipton : 139.82' : 238.63 : 58.6 Illinois - Macoupin : ' 51.43 : 127.58 : 40 . 3 Michigan - Lenawee : '47.39 : 126.43 : ' 37 . 9 Wisconsin - Dane : ' 54.90 : 154.95 : 35.4 . Minnesota - McLebd 49.81 ; 136.61 :' 36.5 South Dakota - Moody : 72.55 206.39 : 35.2 Iowa - Union : 1 80.91 - '• 165.83 : 48.8 - Story : 109.44 296.07 : 37.0 , . Nebraska -"wayne' • 93.89 • I '243.31 ' : 38.6 Kansas - Butler • '22.00 : 5 57.01 : 38.6 Virginia - Southampton ■ -' 30.83 • 39.80 : 77. 5 Nortn Carolina -- Halifax : 32 . 50 : 47 . 86 : 67 . 9 Georgia - Bleckley 38.86 ' ' : • 41.46 93.7 A "1 _ T _ _ Alabama - Montgomery : ■ 34.46 : ' 50.81 : 67.8 Mississippi _ Tunica • t "203.71 - ' • 133.65 : 152.4 Tennessee - Rutherford -48.33 : 68.66 70.4 Arkansas - St. Francis ■ • : 61.07 • ' ': 99.24 : 61.5 Oklahoma - Payne- 14.84 . i " 37. 56 ; 39.5 Colorado - Delta i - 43.24 ■'• ; ' 79.02 : 54.7 - Otero- : 153.38 ; 187.40 : 81.8 Utah - Salt Lake ■ " ; : 99.86 ': 278.13 : 35.9 Idaho - Ada ' 99.58 . . : 237.84 41.9 -' Madi son : : • • ; 123.90 ' : : 252.12 : 49.1 Oregon - Washington : 44 . 26 : 136.51 : 32.4 California - Sacramento • 142.66 : 184.85 : 77.2 - Merced ; 123.48 : 221.49 : 55.7 Arizona - Maricopa : 317.11 : 307.75 . : 103.0 ne rates of capitalization used for different counties were the pre- g farm mortgage rates reported by the census of 1920. - 10 - Table 3. Percentage of Census Valuation Assignable to Current Income From Rent, Capitalized at Average Rate of Interest on First Mortgages, 1919. State •• ; ; 'Census Valuation and ■: County ; Census \Fs* Inn "hi : Assignable to 1 : net rental Assignable tn other factors Per Cent . "Dei Y» P Q-n +■ Ohio - Franklin ' 100 ; ^iCi . d , ^7 4 Indiana - Tipton ■ loo J-\J w • \J : 58.6 41.4 Illinois - Macoupin : 100.0 : 40.3 59.7 Michigan - Lenawee 100 . : 37.9 62. 1 Wisconsin - Dane : 100.0 : 35.4 64.6 Minnesota - McLeod • ' 100 . : 36. 5 63.5 South Dakota -Moody : 100.0 : 35.2 64.8 Iowa - Union : • • •100.0 : 48.8 51.2 - Story : 100.0 : 37.0 63.0 Nebraska - Wayne • 100.0 : ' 38.6 ; 61.4 Kansas - Butler •100.0 : 38.6 : 61.4 The fluctuation in rent, as- well as the fluctuation in land values, illustrates the uncertain foundation upon which the farm real estate tax "based on sale value rests. The annual tax is "based not only on present income "but on predicted incomes which may or may not he realized. If all property subject to the general property tax possessed equally this con- ditional element, assuming uniform assessments, the chance of inequality "because of this factor would be greatly reduced. But this is not the case. The value of many classes of property other than farm land follows closely capitalized annual income, or if not closely, certainly more closely than farm real estate. In fact, the value of real estate itself follows more closely the capitalized annual .earnings in the case of some farms than others. This variation in the relation of annual and sale value of farms explains in part the different percentages of rents absorbed by taxes, shown in Table I. Table 4. Annual Rental Capitalized at Average Interest Rates in Relation to. Assessed Valuation, 1920. State and Count v Capitalized Sental, Per Cent of Assessed Valuation :' Per Cent Ohio - Franklin . 71.3 Indiana - Tipton . : 71.0 Illinois - Macoupin- ". 127.1 Michigan - Lenawee 46.4 Wisconsin - Dane ' ' ? . 47.7 Minnesota - McLeod :'■ '■ 48.7 South Dakota - Moody 76.6 Iowa - Union : 120.5 . . - Story t - ; 114.0 Nebraska - Wayne -. -63.5 Kansas - Butler .62 .7 ■When the annual value, as derived above, is compared with assessed valuation, Table 5, it is found that the capitalized annual rental in 8 of the .11 counties surveyed in the North Central States represented less than 77 per cent of the assessed valuation. In 3 of the counties it rep- resented less than 50 per cent, while in 3 of the counties it'was more than 100 per cent of assessed valuation. This illustrates the slight relation that exists in some States between the annual income from- farms and the annual tax. The. variability in the relation of the tax to census valuation is shown in Table 6 of the Appendix. Relation of Taxes to Rent of Urban Real Estate were iaxes on urban real estate, in percentage of net rent^/ ascertained for a limited number of properties in 10 counties where farm surveys were made. The percentage in 7 of the 10 counties, as shown in Table 5, was - -12: ■- practically the same as that found for . farm real estate in the same coun- ties. .5/ In two of the counties- this percentage for. farm real estate was .two and a, half times- that for the. urban ,,12/ and in Washington County, Oregon, one and a ha.lf times as. much. =±1 .. ■:, . .While buildings represent a higher percentage' of the value of urban real estate than of - farms (about 50 per cent for these properties) urban and, rural real estate, are near- enough alike in most respects for trust- worthy comparison of Obec* taxes' in relation to rents. Taxes on urban real estate include in part special municipal .levies for providing special facilities such as light and water, which the farmer provides at private expense. If only :taxes for the .same or similar .purposes had been included in these statistics, the- tax in percentage of rent of urban real estate would have been less in practically all counties than that shown for farms. Table 5. Property Taxes of Urban Real Estate, Percentage ■'. : of Net- Rent , 1919.. Relation of Approximate Average : Taxe s to S t a t. e ■ . • r. •Prop- average . net rental : Average net rent and : er- value of (Before : Tax on : (Before de- County : ties land and .deducting : Peal- ducting buildings taxe s ) / 1 : Estate taxes) Number Dollars : Dollars : Dollars : Per Cent New York - Niagara. . 15 $ 17,662 $ 1,604 :$ 197.99 • : 12.3 Indiana. - Tipton . : 20 11,827 1, 322 208 . 74 : 15.8 Illinois - Macoupin : 48 14,369 : . 917 ■ : 144.80 ; ' 15.8 Wisconsin - Dane : -. 9 : 216, 504 35,429 : 3,956.60 11.2 Minnesota - McLeod 21 : 9,685 : 638 : 158.52 24.8 South Dakota - Moody 38 10,903 • 612 : 128.11' 20 . 9 ' Iowa - Union : 16 1,329 :• 212.17 : 16.0 Kansas - Butler - ; 15 - r— 26,961 : 3,634 : 814.06 22.4 Colorado - Delta • 17 13,611 : 1,094 278.59. 25.5 Oregon - Washington . 15 : 216,282 1,186 : 335.96. 28.3 /l_ Deductions from gross rent, to obtain net rent, include repairs and insurance reported for the. properties and 2 per cent of assessed valu- ation of buildings for structural deterioration. 9/ These seven counties are Tipton, Indiana-; Macoupin,' Illinois; McLeod, Minnesota; Moody,. South Dakota;- Union, Iowa; Butler , -Kansas; and Delta', Colorado. . - - -•-> . -h ■• : 10/ Counties: Niagara, New York; Dane, Wisconsin. 11/ The urban real estate- included in the-s'e counties was mainly busi- ness property with brick and stone .structures in good or medium condition, except in McLeod County, Minnesota, and Moody County, South Dakota, where some frame residences were included. ■ - ■ • • ' Figure 6. Distribution of Property Taxes /l According to Levying Jurisdiction. State Levied by and : Township County State County : and Local District Per Cent Per Cent Per Cent Pennsylvania - Chester/2 • 18.3 ; 81.7 Ohio - Franklin [3 \ 5.5 : 47.6 : 46.9 Indiana - Tipton /4 : 21.2 23.2 : 55.6 Michigan - Lenawee [b 21.6 : 57.3 i 21.1 South Dakota - Moody /§_ : 20 . 8 : 66.6 : 12.6 Iowa - Union /? : 14.6 : 38.5 : t 46.9 - Story 1; 11.0 34 . 1 54.9 Nebraska - Wayne r 26.0 : 29.1 : 44. 9 Alabama - Montgomery r 38.2 : 61.8 Mississippi - Tunica [Q_ : 14.7 u 74.7 : 10.6 Tennessee - Rutherford : 30.1 13.7 : 56.2 Arkansas - St. Francis :. 21.5 : 24.3 : 54.2 Colorado - Delta : 16.5 s " 30.4 53.1 - Otero : 18.4 : 30 . 9 50.7 Idaho - Madison /_9 25.3 : 51.6 : 23.1 California - Merced 79.3 : 20.7 /l Including all property taxes levied in the county in 1919 except special municipal, drainage or levee and ir- rigation taxes, unless specifically stated otherwise. (As reported by county officials or computed from offi- cial reports). [2_ Only taxes levied on 177 selected farms. /3 Only taxes levied on rural property. /4 The district road tax is classed with township and local district taxes, although in many cases the township road is a part of the county system. Including drainage tax. 16 Hot including taxes on moneys and credits and telephone property. [Z Taxes on rural property. ■ • [Q_ Taxes on cultivable land, not including acreage levee tax. /— i. Bot including predatory animal tax. - 14 - Distribution of Property Taxes According to Levying Jurisclic tion .and Purpose In most of the 16 counties for which data were secured, the State as compared .with the county and minor subdivisions, levied a relatively smail proportion of the property tax. The 'State tax in Montgomery County, Alabama, was ever a third of the total, as shown in Table 6, while in Franklin County, Ohio, it was as low as 5.5 per cent of the total. In Pennsylvania and "California no real estate tax was levied by the State. The proportion of property taxes levied by the county government ranged from 18 to 79 per cent, and by townships and local districts, not including incorporated places, from 11 to 82 per cent. The varying proportions of the total, tax levied by the county or minor subdivisions of the county merely reflect differences in method of cor due ting county and local affairs. If there is a high degree of central- ization in the county as regards .school and road finance, as, for example, in Montgomery County, Alabama,^ a large proportion of local taxes will be levied by the county rather than by local districts. If the opposite of this prevails as in Chester County, Pennsylvania, most of the tax may be levied by townships and local districts. Variation in the proportion lev- ied by the State is partly explained in the same way, although the State's part is affected more by revenues from sources other than the property tax. Analysis of the use made ' of the tax dollar can be shown accurately only where statistics of expenditures are available. In the absence of sucn data tax levies indicate in a general way the major purposes of taxa- tion, of these only two classes, school and road, could be separated with a reasonable degree of exactness. In 14 of the 16 counties, over a third of all property taxes was levied for schools, and in 3 of these counties over half of the total was for schools. Only in the Pennsylvania and Mississippi Counties was as rnuch as a third of property taxes levied for road purposes, and the road tax was more than the school tax only in the Mississippi County. Revenues obtained from other sources, of course, have some effect on the proportion of ths road tax shown here. It has not been possio^e to show trustworthy comparis-:.i of taxes used for general and miscellaneous expenses, inasmuch as srjie States make specified levies for ceroain expenses, while others appropriate revenues from the general fund for such expenses. Moreover, soiue elasticity in the use of the general fund with respect to education and' highways is allowed in some States. As a rule, most of the State property tax, where State taxes were levied at all, was for general ei.pjnr.e, although in 3 of the counties about half of the state levy was for schools ox one kind or another. The general !?/ local school districts in this county, und^r an enabling Act, have been consolidated into a county-wide district with u.nif o: m tax rate for school purposes. Local road taxes are also levied uniformly over the county. - 15 - Table 7. Distribution as to Purpose for which Froperty Taxes are. Levied. State ; Poad : and : Education , and : All ■ .'County Bridge Other Pennsylvania - Chester 39.4 42.3 : 18.3 Ohio - Franklin ; 34.0 : 19.8 : 46.2 Indiana - Tipton : 57.2 : 22.8 20.0 Michigan - Lenawee : 24.6 27.2 : 48.2 South Dakota - Moody 34.3 : 15.0 50.7 Iowa - Union : 38 . 9 25.5 : 35.6 - Story 49.9 : 19.3 30.8 Nebraska - Wayne 45 8 30 : 24.2 Alabama - Montgomery : 35.3 : 14 . 7 50.0 Mississippi - Tunica : 7.4 : 35.3 : 57.3 Tennessee - Rutherford : 52.0 : 15.1 32.9 Arkansas - St. Francis 43.6 : 32.7 : 23.7 Colorado - Delta : 49.8 : 21. 5 : 28.7 - Otero 59.9 : 1SF.8 : 20.3 Idaho - Madison 46. 7 : 13.6 : 39.7 California - Merced : ■ 34 . 5 : 22.5 43.0 expense item is usually more important in county levies, although in a few counties, according to the system which happens to prevail, school and road taxes may constitute a large part. Township ana special district taxes are usually for school, road and miscellaneous expense of a local character.^/ Over 80 per cent of the school tax in the counties studied in Pennsylvania, Ohio, Indiana, Iowa, Nebraska, Tennessee, and Colorado was levied by townships and local districts. In Michigan, South Dakota and Mississippi the school tax was levied primarily by the county. In Idaho and California counties this levy was about -equally divided between county and local districts, while in Montgomery County, Alabama, it was about equally divided between State and county. In St. Francis County, Arkansas, the State levied about a third and local districts about two- thirds of school taxes. In the levy of property taxes for highway purposes the county plays the leading role. i n Ohio, Indiana, Michigan, South Dakota, Iowa, Alabama, Mississippi, Colorado and California, approximately two-thirds or more of the road tax was levied by the county. In these counties the remainder of the tax was levied by townships and local districts, except in Ohio, Indiana, and Colorado, where the State levied a small proportion of the tax. In the Pennsylvania and Arkansas counties local districts levied most of the tax. In wayne County, Nebraska, the county levied 60 per cent of road taxes, and 13/ In a few cases it has not been possible to separate from other taxes the road tax levied by townships but the effect on the final result is un- important. - 16 - the State and local districts shared the remainder equally. In Madison County, Idaho, the State levied over half of the tax and the county the remainder. In Eutheri'ord County, Tennessee, the State levied about a third and local districts two- thirds. Practically every conceivable combination of State, county and local tax levies is thus shown for the few counties considered. Analysis of the general property tax in this respect, however, fails to give a complete picture of State and local fiscal systems. : Some of the revenues for school and especially for highway purposes is obtained from sources other than the general property tax. Accurate Analyses of 'the sources of all revenues, on the one hand, and the expenditure of such revenues, on the other, would have more significance. While this has not been done in the present study, the system of distribution of tax revenues is known to have a direct bearing on the problem of farm real estate taxation. The general property tax 'is the principal reliance of State and local governments, as shown in 'Table 1 of the Appendix, but considerable revenues are obtained for State purposes from other sources. The amount and the use made of such special revenues will determine in a measure the relative amount 'of taxes paid on real estate". For instance, in view of the present demand for educational and highway services and facilities, the State that shifts the responsibility of financing these special functions of government to- the county or local districts may expect heavy real estate taxation. This is true for the reasons that local taxation in rural dis- tricts means general property taxation, and that general property taxation always degenerates, essentially into a tax on real estate. Distribution of revenues, , therefore, is an important part of the problem. What is the relation of State to local expenditures? Certainly, the State's obligation goes, further than- merely fixing certain standards for the local government to follow without giving'' any financial support to the maintenance of such standards. The State has : a direct financial obligation to the locality in maintaining those services and facilities having general, as distinguished from local, benefits. Many States have undoubtedly shirked this responsibility, in part at least, as regards public education and high- ways. The direct result has been heavier taxation of farm real estate. Professor John A. Hobson, dealing with the same problem in England, says: It is equally clear that, if the State is to require conformity to a na- tional standard of efficiency on the nart of local administrators, it must be prepared to assist in the finance." 14/ Some have erroneously believed that a reduction in State revenues will mean a reduction in their tax bill. On the contrary, a reduction in State revenues may have, the opposite effect on certain groups of taxpayers, especially farmers, unless such reduction is merely for the purpose of cur- tailing the State's administrative expense, where the State withholds its support from public education, highways, and like functions, in so far as such services have general rather than local importance, the localities 14/ Hobson, John A. , Taxation in the New State, p. 241. must take up the burden where the State leaves it, with resulting higher local .taxation-. .• • - * - r f . : While no final conclusions may "be drawn cn the" basis of limited data, certain facts in the present report appear significant. A large percentage of farm rents in many counties was paid out in taxes in 1919, when rents were higher "and taxes lower than they -are at present. There is reason to believe, in fact, that since 1919, taxes' have absorbed all the income from rent on many of the less favored farms. Excessive farm real estate taxation results from the attempt to apply sale' value as a uniform measure of the tax to classes of property yielding- differ ing rates of return and varying in the difficulty with which they are reached under general property tax methods. The solution of this part of the problem may finally be found in the assessment of certain rather than- uncertain values, and in the measure- ment of the tax more nearly than it is now according to earning capacity. The situation would further -be remedied by ra.ising more revenues from sources that" are now yielding' a smaller tax return than they might for dis- tribution in such a way as to- relieve the present excessive local tax bur- den. A degree of retrenchment in public expenditures along some lines is doubtless advisable, but no permanent measure of relief for farmers is to be expected without thorough readjustment in State and local fiscal methods. _ 18 _ APPENDIX •Taole 1. General property taxes, percentage of total tax revenues, if by states and minor, civil divisions, 1922 (Total's expressed in thousands of dollars") - : Total taxes : . General : (not including : General : property tax, Civil Divisions " "^TIPP i 1 PT^r^'S — e Kj ' — ■ X. C_ J J- C o o \^ o vJ ■ or one 1 " ty : per cent of : ment) : " total : Dollars : Dollars : per cent Alabama : . 29,229 : 22,706 : 77.7 State : 10 , 305 • 6 , 633 : ' 64.4 Counties • : •■ 12,123 : 11,427 : .. 94.3 ^. w ii o • l a. cx xi\A. U X Z> \j x U t~* 1 Incorporated towns and _ci tie s. : 6,801 : 4,645 : 68 . 3 Arizona : 19 , 692 ; 18 , b58 : ' 94 . 2 State 6,315 : 5,680 : 89.9 Courties : 6,626 : 6,451 : 97.4 _u oil i p euiu ijistricx : 4,774 : 4,665 : 97 . 7 Incorporated tov/ns and cities :_ 1,977 : 1,762 , : 89. 1 Arkansas : ' 20,471 : 16,713 : 81.7 State : 6,444 : 4,686 : 72.7 Counties : 5,717 : 4,433 : 77 . 5 : 6,^80 : 6,280 : 100 . Incorporated towns_and cities 2,030 : 1,319 : 65.0 Calif ornia : 207,372 r 157,50^ : 76.0 State : 43,599 5 5 .01 Counties : 64,133 : 63,049 : 93.3 Town snip and District • uo . Township and District ' . IE , S06 • : 15, 575 ; so . o Incor-p orated ptpwns_and cities : j. , 9 ;j2 : 1,911 OO V ( . Q Ohio t- 1 — , \J X c 7 ., pio era : • 87. 5 State • "!7 07 £ 41 . c o C o un ties : ru, -^o OP? : . 9 7 . 6 Township and bis trict. :?u,.S0l : : 75^474 99. 8 Incorporated .towns- and cities 52,280 : 55,990 : 91. 5 Oklahoma Do , O f± , 'it , OJ.3 : 83. 5 State C, riD : i , i4o : .17. 1 r Io.oicjd : 11,,594 ; 87. Township and District 23,329 : , 22,733 ; . 97. 5 Incorporated towns and cities;: : 9,704 : 8,841 : 91. 1 a n /i /"N't • 4_L,40 : ou ,0(1 qq a State : 0,100 ■ RPi R ; o(j . o Counti p r . a, 44c OA A : y4 . 4 Township and District : 14,818 : 14,744 : 99.5 Incorporated towns and cities : 4,296' : 4 , 198 97. 7 Tonne s see : 35,202 be . State : I0,l<3l- : 6 , 10 6 : 60-3 : v 19,563" : 17,485 89. 4 Township and District : 431 : 426 98.8 j-i^uj iju. c3 bv^u. oo< 96 7 Township and District Zj ..Incorporated towns and cities 16,160 13,415 : -83.0 Washington • UO , l t u fin iPA • 87 5 State 1 7 QD7 X f , O O r in qi r XU , JlJ si n Dl.v Counties . x r , Jo 1 ; Id, too ; y<& . D Township and District j 21,202 21,202 100.0 Incorporated towns and cities 12,626 : 12,286 97.3 West Virginia • ft UO X Xcll o :Per cent Per cent Oklahoma : Payne 145. 2 • x D^i . y 64. 3 62. 3 . OO . t AO \ ■ L ±Ct 15. 7 17.4 Colorado Delta : 69 3, yy . i> : 54. 7. 43. 9 ry . : no , 15. 16.7 Otero 100. 3. : 78. 9 28. 2 • lu f . fin 13. 6 12.7 Utah Salt Lake : 42 7; 130.1 76. 1 29. 1 ' 278 : 84 . • 11.8 16.9 Idaho Ada 46 9 92 . 7 86. 6 64. 6 238 : 142 11.4 13.9 Madison : 93 6 . . 234 . 5 : 94 3 71. 3, : 252 . :■• ■ 80 : 3.4 : 10.5 Oregon "Washington : 102 0. ' . • 72 . 3 : 57 54. 3 137 , : 153 12.2 16.9 California Sacramento • 90 9 186. 7 : 93 8 71. 8 185 : : 144 : 7.6 • '9.4 Merced 109 7 : 394.4 : 85 8 45. I . 222 t 78 : . 9.5 : 11.0 Arizona _ Maricopa 83 : 204.2 L_ 95, 3 34. 8 : 308 :" 114 '4.7 7.9 1/ Census of 1920. • - 29 - Table 3. Net Cash Rent, percentage of- Census Valuation, Selected Farms, . 19 1 9. State ■ : and : County' : : Net Cash. Rent, percentage of census valua- tion (before deducting taxes : ; State : ■ . and : County ) : Net Cash fient x : percentage of : census valua- : at ion (before : deducting taxes Per Cent Per Cent New York - Delaware 4 .3 : Georgia. - Bleckley 7 .1 - UTiagara 2 .5 ; Alabama - Montgomery • 4 . 7 Pennsylvania - Chester 1 .6 . • Mississippi - Tunica 10 . 7 Grio - Prank! in 3 . 2 : Tennessee - Rutherford 4 .6 Indiana - Tipton 3 .9 Arkansas - St. Francis .1 Illinois - Macoupin 2 .8 : Oklahoma - Payne 3 . 5 Michigan - Lenawee 3 .5 : Colorado - Delta 5 .1 \» is con sin - Dane 2 .6 : . - Otero 6 .7 Minnesota - McLeod 2 .6 : Utah - Salt Lake 3 .5 South Dakota - Moody 2 .3 : Idaho - Ada 4 .2 Iowa - Union 3 .2 Idaho - Madison 4 . 5 ' - Story 2 .5 Oregon r "Washington 3 .2 Nebraska - jfayne 2 . 4 California. - Sacramento 5 .7 Kansas - Butler 3 .0 r - Merced 4 .4 Virginia - Southampton 4 . 9 Arizona - Maricopa 8 .7 North Carolina - Halifax 4 .3 - 30 - Table 4. Rates of Depreciation and Repairs, and of Insurance [~L By Counties, and Total Deduction per Acre from Gross Rent. :Rate of ;Rate of - Total :Rate ofrRate of : Total •depre- : insur- de due - :depre- •insur- ■ deduc- State ciation ance per 'tion per • State : c iation :ance per 'tion per ;and re- : $100 .acre for : and r e — : $100 acre for and :pair s * va lua— deprecia- ; and •nair '. va lua— deprecia- t on ; tion of tion re — • on : tion of : tion, re- County :build- •build- na.ir ^ . and Conn t v :build- :build- : pair s , and : ings . : ing s . ■ insurance ! infrs . : ings. insurance Per Cent : Do liars Do 1 lar s Per Cent .•Dollars Dollar s Hew York 'Georgia Delaware 4.0 .36 .58 ; Bleckley 7.1 1.24 .56 Niagara 4.0 .36 1.39 : Alabama Pennsylvania : Montgomery 5.8 1.62 .65 Chester 4.0 .40 2.39 :Mi ssi ssippi Ohio : Tunica 7.9 1.62 1.77 Franklin 3.3 .25 .53 : Tennessee Indiana : Rutherford 5.4 .67 .82, Tipton 3.0 .33 '•■ . 83 : Arkansas Illinois : St. prancis 6.5 .97 1.06 Macoupin 3.0 .37 .63 : Oklahoma Michigan : Payne 6.0 .87 .39 Lenawee 3.7 .43 1.71 : Co lor ado .Wisconsin : Delta 7.2 .50 .89 Dane 3.6 .23 1.15 : Otero 7.2 . 50 1.93 Minnesota :Utah McLeod 4.0 .35 .86 ■ Salt Lake 4.4 . 57 1. 58 South Dakota Idaho Moody 4.0 .25 . 81 • Ada 4.6 . 69 1. 39 Iowa Ti/c d 1 COT1 4 6 . 69 .44 Union 4.9* .30 95 Story 5.1 .30 1.18 Washington 4.7 .52 .86 Nebraska California to ayne 5.0 .24 .95 : Sacramento 4.5 .55 .70 Kansas Lerced 4.5 .55 1.03 Butler 5.0 .35 .33 . Arizona Virginia Maricopa 4.4 1.37 .78 Southampton 4.5 .73 .31 : North Carolina Halifax 4.5 .70 .51 , / 1 In States where both old line and farmers 1 mutual insurance companies operate, an everage of the rates used was derived by taking into account the percentage of business done by each in the State. lor example, if in a State three-fourths of farmers' insurance is carried by farmers' mutual insurance companies and one-fourth by old line companies, the respective rates were weighted by three-fourths and one- fourth. In the Central and Northwestern States the rate used 7/as about the same as that of the farmers' mutual s, while in most Southern States the rate was usually that of the old line companies. The cost of insurance, whether insurance was actually carried or not, was computed for all farms upon the Assumption that the rate for any area reflects approximately the average loss sustained from the usual hazards covered by such insurance. - 31 - Table 5. Assessed valuation of farm real estate in relation to Census valuation, 1920 State and County Statutory Provisions, 1921 :Assossed va lua- tion : per : acre 2/ : Census : valua- tion per : acre :Eelation of assessed to census ■valuation §/ : Exemption of farm : Teal estate : Hate of assessment : oi farm real es- : ta te 1/ New York Delaware Niagara :P.eal property pur- chased "by pension mon- terit of $5,000. Lim- :ite'd acreage of forest 1 Ipn'd "nlpnterl and tpp 1 — ■ -^-O- 1-± -_L J-CLli \j\s*JL wll-L -I. *^p} istered. :Pull value -according •to amount property » VJTi 1*1*1 epl 1 f nT "hp- :tween a willing sell- er and a willing • "hn vp t* W LL i . : Dollar s : 17.25 . 75.73 : Dollars : 28.57 : 110.31 per cent 60.4 : 68.7 Pen n s y Ivan i a Chester ' 7 To exermti nn 73. 83 : 115.71 63.8 Ohio : franklin TJo exemntinn True value, as ascer- tain pd "hv ii ^na 1 se 11 — : ing. price ' for cash :at voluntary sale : 116.20 : 194.67 : 59.7 Indiana Tip ten :50;/o of mortgaged value •limited to $1,000 per :At price property :would "bring at pri- : 197.00 : 238.63 : 82.6 Illinois Macoupin ■No exemption lull value,, 50 per cent of which is tax- ; a o xe : (20.23) : 40.46 127. 58 (15.9) 31. 8 Michigan LcBiivjee ::To exemption' Cash value or usual :selling price : 103.31 : 126.43 81 . 7 Wisconsin Dane :Land of 20 to 40 acres 'settled as a homestead and' devoted to agri- culture, exempt for 3 year s pull value- that could he obtained at •private sale • 115.21 : 154.95 : 74.4 Minnesota : McLeod' ; No e xenp t i o n :Pull value, ^ 33-1/3 pel cent of which is tax- ab le ' (34.09) : 102.27 : 136.61 , ■ (25.0) 74. 9 So . Da too ta Moody ' Dwelling houses occu- pied by owner exempt to thp pxfp-nt nf *Rnn 3/ Cash value - price : property is fairly : vir\ t* "1* Vi "i vi r^inriPV yi "h ' VYUI 0-1 XXI XiiUIlt*^ , LIU l> , at auction sale 94.71 206.39 45. 9 Iowa Union : Story : .Area of roads adjacent to farms exempt. : The value of the mar- ket in the ordinary course of trade, 25 : per cent of .which is . taxab 1 e : (16.79) 67.16 (24.00) 96.00 165.83 : 296.07 . (10.1) 40.5 ( 8.1) 32.4 Nebraska- : bayne : Actual value, accord-: ing to the market in . the ordinary course ; of trade : 147. 86 243. 31 60. 8 - 32 - Table ,5. Assessed valuation of farm real estate in relation to Census valuation, 1920. (Continued) State and County Statutory Provisions,. 1921 Assessed j valua- tion . per • acre Census valua- tion per acre Relation of assessed to census valuation ■ Exemption of farm real estate Rate of assessment of farm real es- : tate. Kansas Butler Kb exemption :True value in money : : Do liars 35.09 Dollars : 57.01 Per cent 61.6 Virginia Southamp- ton No exemption :Tair market value' 7 . 59 ; : 39.80 19.1 No. Carolina Halifax ■ .No exemption : True value in money - :What property would : "bring -when sold for cash in the usual : manner .■ .8.97 : 47 ."86 18.7 Georgia ■ Bleckley .No exemption :Pair market value , : amount property would : "bring when sold in : the usual way. : 11.10 : 41 .46 : 26.8 Alabama Montgomery :I\To exemption : : "Reasonable cash value : 60 per cent of which :is taxable : (9.74) 16.23 • 50.81 (19.1) : 31.9 Mississippi Tunica No exemption :At price property :wo\xld "bring at a vol- runtary sale : 57.07 : 133.65 42.7 Tennessee' Rutherford No exemption •Actual cash value - . the price, that could •he obtained where : located, at a : private : sale . ■ 13 . 31 • 68.66 19.4 Arkansas St.- Francis 3 Ho exemption 10.90 - 99.24 11.0 Oklahoma • Payne :Ub exemption. ; :Fair cash value - es- : tima ted price ■ of fair :and voluntary ' sale . • 21.91 ' : 37.56 58.3 Colorado > Delta , . Otero :No exemption :Tuli cash value 43.07 114.87 79.02 187.40 54. 5 61 . 3 Utah Salt Lake No exemption lull cash value - amount 'at which prop-: erty would be taken in payment of 'a just : •debt due from a sol- : vent creditor : 148.85 : 278.13 : 53. 5 - 33 - Table 5. Assessed valuation of farm real estate in relation to Census valuation, 1920. (Continued) State and County : Statutory Provisions, 1921 :Assessed • valua- : tion : per ■ acre : Census : va.lua- •tion per acre :Eelationo ■assessed :to census :valuation : Exemp t i o n o f f arm • real, estate : Rate of assessment : of farm real es- : te ts Idaho Ada Madison Improvements not ex- ceeding $200 in value are exempt. Special : exemption up to $1,000^ i of property of widows and. orphans and Union : soldiers, and sailors, when total assp^QmpTrh does not exceed $5,000' :Pull cash value : 107.22 : 58.62 237. 84 252. 12 : 45. 1 23.3 Oregon 'washing too No exemption :True cash value at voluntary sale in the usual course of busi-. ne ss .53.01 : 136.51 38.8 California Sacramento. Merced No exemption ; 47.25 32.20 184.85 .221.49 25. 6 14.5 Arizona ; Maricopa Property, of resident widows not to exceed : $1,000 where total assessment does not : exceed $2,000 . Pull cash value - as ■ given in payment of a: just debt due from ; solvent creditor : 128.40 : 307.75 : 41.7 1/ Although the legal requirement is practically the same in most states, the termi- nology as expressed Toy different state laws is used in this table. 2] Pigure in parentheses shows valuation upon which tax is "based. ZJ This provision has been since repealed. - 34 - Table 6. Parm Real Estate Tax, Percentage of Census Valuation of Land end Improvements of Selected JPims, 1S20. 1/ : Census : Tax :Tax, Percentage ota T . e ana. bounty : valuation : per of Census — — ■ . , per acre acre : Valuation : Dollars : Dollars : Fer Cent .jew lorn. — Lexav;are : 28.57 : . . . .38 : 1.3 — liiagara : 110.31 : . 85 o : • o reunify x vcixiia — u-iesxer : 115. 71 I 1 . 20 : 1.0 I 1 94 . 6 7 : 1.41 i : - 7 i^iaicina - ripuon : 238.63 : 1 .41 : .6 Iliiijois — Macoupin : 127,58 : . 64 : . 5 j-i^ j^, -lii — jjciiswee : 126.43 : 1 . 67 : 1.3 Uiscor. sin — ' Pane : 154.95 : 1. 18 : .8 Miiiiie so ta - ' Mc Leo d : 136.61 : . 85 : .6 South Dakota - foody : 206.39 : . 77 . 4 Iowa - Union : 165.33 : .84 : .5 • - Story : 2 95 . 07 : 1.37 : . 5 Nebraska. - Y/ayre : 243 . 31 : -67 .3 Kansas - Butler : 57.01 r .41 .7 Virginia - Southampton : 39 . 80 : . 11 : .3 iJorth Carolina - Halifax : 47.86 ; ! .13 : : .3 Georgia - Bleckley : 41.46 ' j " .22 : :' .5 Alabama - Montgomery : 50.81 .17 ; .3 Mississippi - Tunica' : 133.65 1.61 : 1.2 icJuxicEjsuc — _cu. oiiisT .i or& ; 68.66 : . .24 ; r-f . 3 Arkansas - St. Prancis 99 . 24 .53 : .5 Oklahoma - Payne : 37.56 ; . 38 1.0 Colorado - Delta j 79.02 : .96 : 1.2 - Otero ; 187.40 : 2. 19 : 1.2 Utah - Salt Lake ; 278.13 ■ : 2.82 : 1.0 Idaho - Ada : 237 . 84 : 2.85 : 1.2 - Madison : 252.12 : 1.76 . : .7 Oregon - Washington i 136.51 : 1.64 : 1.2 California - Sacramento : 184 . 85 : 1.36 : .7 - Merced : 221.49 : 1.63 : .7 Arizona - Maricopa ; 307.75 : 2.61 : .8 1/ Mumber of farms and total acreage are the same as shov/n in Table 1.