USA > Massachusetts > Essex County > Nahant > Some annals of Nahant, Massachusetts > Part 33
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The town report for the next year records eighty-one in military service and sixteen in other branches, yielding a total well over any quota assessed against the town. This also does not include non-residents. It includes three Coast Guard men and several Shipping Board men. One of the latter is Captain Charles F. Kemp, whose experience qualified him to be senior fleet captain with all the gold braid a cap could
377
LATER YEARS
carry. Mayland P. Lewis, coming back from service a lieu- tenant, brought a German machine gun which he presented to the town, and which was put in the custody of the Public Library, where it has been on exhibition most of the time. Of course, many souvenirs came to town with returning vet- erans, while those not so fortunate as to get to France were envious, but had done what the country asked of them.
The men came back irregularly, but on July 4, 1919, they were nearly all returned, and the town had a welcome home celebration, using a small town appropriation and a larger sum raised by private subscription. On July 3 a banquet was given them in the Town Hall, which was filled to capacity. The speakers were Lieutenant-Colonel Harold Blanchard, Lieutenant Henry R. Guild and Dr. Morton Prince. The roll of honor published in the program for this occasion con- tains just one hundred names, and is subject to additions and changes, as are those formerly mentioned, to make it complete or make it contain only legal residents. Special honor medals were presented by the town, through Harry C. Wilson, chair- man of the selectmen, to all of these men.
On July 4 the morning was devoted to band concerts and games. The afternoon saw another band concert. Then came a parade of the best the town contained, - the Army, Navy, Shipping Board, Coast Guard, G. A. R. and Spanish War Veterans, town officers, Red Cross, Junior Red Cross, Boy Scouts, Girl Scouts, several small groups, decorated auto- mobiles, a float section, and the fire department. John A. Blanchard was chief marshal, and the committee in charge included the selectmen, Harry C. Wilson, Dana A. Sanborn and Charles A. Phillips, with Winthrop T. Hodges, Robert Cushman, Jr., Dr. Lawrence F. Cusick, Joseph D. Lydon, Edgar Levinstein, John A. Blanchard, Joshua B. Holden, John H. Foster and Ralph G. Calef. Some of these will be recognized as old reliables for committee work, always ready to do a part for Nahant. Others are less known as Nahanters, or in town for a shorter period, but all worked to make this welcome home celebration noteworthy.
378
SOME ANNALS OF NAHANT
In 1920 a great boulder was laboriously dragged from the shore and set up in the cemetery. A bronze tablet was mounted on it bearing the names of four Nahanters who died in service, and an inscription which was written by Senator Lodge. Formal dedication by the Legion Post was in 1921. During this same year (1921) the town, through an appro- priation at its March meeting, erected a large bronze tablet in the Town Hall in commemoration of ninety-nine names, intended to be a complete list of all who were legal residents of Nahant. The town committee in charge of this was Thomas Roland, chairman, Harry C. Wilson, Dana A. Sanborn, War- ren Motley and Mayland P. Lewis. The two latter were Commander and Vice-Commander of the Post. Lewis later succeeded to the chief office. This tablet, so appropriately placed, is in marked contrast to many which may be seen on the edges of lawns in front of public buildings or parks. Usually at their best they resemble bill boards, fit to contain some temporary information or misinformation, and even when well designed are ill set, and seem to obtrude the infor- mation "I served." This is farthest from the aim of the Legion, and should be farthest from the act of any one. The American Legion is capable of being a valuable force in the United States. But it may not be too obtrusive, or it will lose its influence. Nor may it be too meek, for the meek never get far. If the meek should "inherit the earth," say during the last fifteen years, wouldn't they have held a hot iron? As in so many ways of life a firm, steady progress comes in the midstream between two extremes.
In 1911, after Senator Lodge's re-election by the State Legislature, his last election by this body, a celebration was started on Nahant in the afternoon, and in the evening a full- fledged parade marched over the town with the ever-present band and plenty of red fire. This was on January 18. It was almost spontaneous, worked up and executed in a few hours. A more pretentious celebration to this distinguished citizen was on the afternoon of September 5, 1922. A welcome home was extended to him, with exercises on the grounds of
379
LATER YEARS
the Town Hall. Charles A. Phillips, chairman of the select- men, presided and introduced Fred A. Wilson, who, in a ten-minute introductory, presented Senator Lodge. Wilson mentioned the long friendship of his father, Joseph T. Wilson, with the guest of the occasion, and in responding the Senator eulogized his old friend, in the course of which he said: "He might have gone far in the State or national politics, but he never seemed to have the least desire to go beyond the work which he did for thirty years as chairman of the Board of Selectmen." Continuing, he spoke with evident feeling of his love for Nahant, where so much of his life had been spent, and of his appreciation of the reception accorded him. The formal exercises closed with the presentation by Dr. Lawrence F. Cusick of a piece of silver plate, suitably inscribed, which had been provided by contributions from many Nahant friends. It was the Senator's last appearance before most Nahanters, and in a little over two years more, on November 9, 1924, he was gone forever. He was a great Nahanter, and to the little town, which had felt his presence and his influence for so many years, came an appreciation of the poet's words, applied to a greater man. There was a lonesome place against the sky.
CHAPTER XXVI
TAXES, VALUATIONS AND EXPENDITURES
THERE is always discussion in any town over valuation and taxation. Yet it would seem that a few things among those often debated might be set down as axiomatic. The important question for a taxpayer is the taxes he pays, and these depend upon town expenditures. The taxes of each payer are a product of the valuation and the tax rate. If the valuation is low the tax rate is high, and vice versa. Three times two is the same as two times three, and the same tax comes from a rate of $20 per thousand on a $3,000 valuation, as from a $30 rate on a $2,000 valuation. There are those who want valuations raised to keep the tax rate down. But this is illusory. If done to encourage newcomers it is deceptive. The shrewd ones will not be content to know the rate, but will also want to know the valuation, and will want to analyze the possibilities of increase or decrease in total valuations and in town expenditures. A difficult matter, but the tax rate has little to do but vary according to the other factors of greater importance. To cite a tax rate is telling very little.
The valuations have always been low, or so rated, ever since the town was founded. There are frequent efforts to get them raised, because certain State assessments are proportionate to the valuation, and the higher this is the more the town pays. Indeed, this might well be a subterfuge to avoid this form of assessment. But the town's consistency in the matter, reach- ing back before the time of this sort of assessment, stops any allegation of this kind from becoming a real argument. Recently people from the State House brought down a list of mortgages, held in some cases by leading Boston banks, in an effort to prove Nahant appraisals for valuation were too low.
381
TAXES, VALUATIONS AND EXPENDITURES
They were badly discomfited. In one case a bank had $9,000 on a property offered for sale a few years ago for under $3,000 which had about $3,000 spent on it afterward. And this is only a sample of what banks do with their wrong appraisals, or methods of appraisal. Frequently some of the larger places on Nahant have changed hands at less than the assessor's valuations. It is yet to be proven that valuations in town are at all out of reason, though admitted to be low.
The important factor in the case is that valuations be uni- form, for of course there is a grievance if one place is rated higher than another similar one. With valuations even and comparable, the taxes any owner pays are the same, so long as appropriations remain the same, and valuations are then fair, whether high or low, because the total tax does not thereby vary.
In the question of equable valuations, however, lies much trouble, especially since the rapid rise in costs which doubled the price of a building. Assume two houses, alike in accom- modations, appearance, location and amount of land. One was built in 1915 at a cost of $5,000 plus $1,000 for land, and has been kept in first-class condition. The other was built in 1920 at a cost of $10,000 plus $1,000 for land. They are the same except in cost. What should be the valuation of each? Assume a house and land costing $10,000 in 1914 and well kept. If desirable it is worth more in 1925 because replacement costs have mounted. A man offers $20,000 to the owner, who occu- pies it. The owner refuses because he likes it and wants to live there, but is tempted to sell at $25,000. For what should the place be valued by the assessors?
There is a fairly simple method of appraisal which sets up a market value and escapes the confusion of some of these elements of changing costs, sentimental values, and such things. If it may be assumed that suitable gross rental for a well-built place, thus not carrying too heavy depreciation and maintenance costs, is 121/2 per cent, or one-eighth the value, then a market value is eight times the rent which may be obtained. It is usually fairly easy to determine for how
382
SOME ANNALS OF NAHANT
much a place will rent. If an owner occupies his house he should still be considered, for this purpose, as paying that rental. It may well happen that he would not sell for such a price as the valuation thus obtained, but why should he pay more taxes on that account? The affirmative answer is that he should be taxed on the money invested, and that this money is the amount he refused for the place; for had he taken it he would have the money in hand, and accordingly it must be considered, in effect, as invested in the place.
W. B. Munro says, in "Invisible Government," that every sensible person knows the doctrine of equality has often been carried too far. Experts are too much unconsidered, and yet all persons are not equally competent. But this principle of parity is not carried into the field of taxation. Men are not considered equal in their capacity to bear the burden of government. Tax laws adopt quite the reverse of any levelling principle. There is a point at which interest in the principles of Rousseau and Jefferson cease. A selected few are conceded to be superior whenever sacrifice is involved.
There is, however, a strong feeling that taxes should be collected mostly on money that is earning and not on money that is idle; that if a man has a picture in his house worth $500 he should not be obliged to pay $15 a year for the privi- lege of looking at it, even though this valuation is an actual market value. In the same way, a man who for sentimental reasons refuses a fancy price for his house has no active money in his place above its market value established at eight times the rent, a price at which any investor might make a pur- chase without any sentimental reasons. The income taxes, State and Federal, are upon money that earns, - active money, -and never upon idle money. The money a man spends on a house up to eight times the rent it would bring is active money, for it is earning for him the rent he would pay if he did not own it. But any sum above this market value is for further factors affording pleasure and satisfaction to the owner, but yielding no income, as a picture yields no income. A man may plant several acres with trees and
383
TAXES, VALUATIONS AND EXPENDITURES
shrubs. Nursery stock costs very little, and when full grown has a low market value because hard to transplant. This statement does not mean trees with a timber value. The place so developed adds greatly to community beauty, but is not even a permanent asset. Without continual care and expense it would revert to field conditions in a year or two. A well-kept lawn means little original outlay, but much annual effort. Under these conditions how can a so-called beautiful estate be valued for its land at much more than its worth when only wild land.
These are some of the arguments on assessors' valuations. The counter claim, which may affect these, relates to the pro- cedure, now a fairly general practice, which makes the rich man pay more taxes than the poor man. Income taxes are about all on this basis, State and Federal. Before the days of income taxes the fact was different. Property other than real estate was easily hidden or hard to appraise, so that most rich men did not pay taxes on all of it. At the same time, the poorer man, with all of his property more visible, perhaps in a house and land, paid taxes on a full valuation. If valuations on Nahant are three-quarters, many a small house owner paid for years on three-quarters of all he had, while many a rich man paid only on one-quarter. The income taxes changed all that, if returns are honestly made, and local taxation is only on real estate and on personal belongings. The latter are mostly in the class of property which does not earn, and which, according to many thinkers, should accordingly be taxed lightly if at all.
Large houses have a lower market value than small ones, for a man able to afford a large place usually wants to build it himself according to his own ideas, and is less willing to buy any that comes upon the market. Rentals also are compara- tively low, for similar reasons. Eight times the rent obtainable would usually give a low valuation, and yet why not a fair one?
A compromise on valuations by assessors is suggested where- by, after establishing a market value by way of the rent ob- tainable, as suggested, a further sum be added to the valuation, based on a percentage of the expenditure less an allowance for
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SOME ANNALS OF NAHANT
deterioration. On this principle, if a man built a house for $10,000 which would rent for $600, his market value would be in round numbers, $5,000. On the remaining $5,000 his house value might be set at one-third or one-half, making a total valuation of around $7,000, in which case he would be paying taxes on $2,000 of non-earning money. The deprecia- tion is a more confused condition. If the $10,000 represents a well-built house, it might have been poorly built for $7,500, and the depreciation would be far more rapid. The $2,500 additional money does not represent more of a house, but is only in lieu of heavy depreciation and upkeep expenses. The depreciation should then be figured as more on the lesser expenditure, while any method of direct percentage figuring accounts it more on the greater expenditure. There is no easy road for assessors through this part of the tangle, but it does seem a good start toward fair valuations to base a market price on the rent, and then use common sense, comparisons and good judgment to establish whatever sum is added to this basic appraisal. More space than is allowed here would explain this situation further, but enough has been shown to enable any one to see that the problems of assessors are not simple, especially after a doubling of building costs over a short period of years. Certainly it would appear, however, that to have assessors' valuations run proportionate to real market values would yield a fair result appealing to every one as just, at least for a basis. Then the argument on additional money invested, money not earning and not reflected in a market value based on rental, might or might not vary any appraisal from this basis so established. Thus assessors' values might be higher or lower than market values. So long as they were proportionate the proper end would be served, for the taxes paid would be the same in any case. The amount of taxes depends on expendi- tures only, after valuations are established as fair, one with another, and do not vary much from year to year.
The valuation of Nahant about sixty years ago was around $1,000,000 for taxation purposes. Then, and until 1917, per- sonal property was included. This meant stocks, bonds, mort-
36000
Schools
CHART OF TOWN EXPENDITURES SINCE 1900
32000
FOR EIGHT LARGEST DEPARTMENTS
NOTES:
28000
The Public Library does not include janitors.
There are about II miles of streets not including the beach road.
24000
20000
Highways
16000
Police
Highways .
Health Fire Dept.
12000
Highways
St. Lts
Water
8000
Fire, Dept.
Police
Water Dept.
Schools
Health
Street Lights
Pub. Lib.
4000
Fire
Dept.
Health
Public Library
Water
nept
1000
-504
1508
15-2
9
-520
1524
1928
G
Town Expenditures
Schools
Police
Street Lighting
385
TAXES, VALUATIONS AND EXPENDITURES
gages, etc. The State has always taxed corporations within the State, and distributed the money so collected among the towns where the various stockholders resided. This is the money, commonly called bank and corporation taxes, which the many town reports of these years enter as received from the Com- monwealth. If a man owned stock in a corporation outside of Massachusetts its value was supposed to be returned to the local assessors, and was included in the personal property valuation.
In 1869 the Nahant tax rate was $4.50 on a valuation of $2,900,000. In 1870 the valuation jumped to $5,100,000, reached over $6,000,000 in 1872, where it remained for five years. Then it dropped into the fives again and went under $5,000,000 in 1879. The tax rate in 1870 and 1871 dropped to $2.50, but the town quickly learned how to spend money and the rate gradually rose to $6.50 in 1877. Then it dropped, reaching $4.50 in 1881, rising again to $6 in 1887, thence to $6.50 in 1889, where it remained until 1896, when it went to $7.50. It reached $8 in 1898 and stopped there until 1905, when it was $9. From 1908 to 1917 the tax rate fluctuated widely between $8 and $12. In 1917 it began its upward march toward present-day figures, reaching $33 in 1926.
Valuations remained fairly steady, between $4,500,000 and $5,000,000, for the period of 1879 to 1899. Then they increased again, gradually, except for a spurt which is not significant, on account of the Sears estate. In 1917 came the State income tax, which removed all personal property from local assessment, leaving only real estate and so-called in- tangibles, meaning clothes, furniture, etc., much of which means a yearly expenditure for replacement. It does not go so far as to tax food, which is also on hand in every house, though subject to replacement at more frequent intervals. Automobiles are included in the present personal property taxed locally, and again comes a difficulty of assessments. A person who buys a new car at the end of March is likely to pay $20 or $30 more taxes on it for the current year than if he waited ten days and was found on April 1 with his old
386
SOME ANNALS OF. NAHANT
car; for by the time another year swings around his new car will become old and be so assessed. Assessors try to be fair, but their problems are often troublesome. Then there is double taxation. A house owner pays on the assessed value of his house. If it is mortgaged for two-thirds of that value the holder of the mortgage may pay an income tax on the interest he receives. This is reflected in the interest rate, and the owner thus may pay two taxes on what may be two- thirds of his property. This is not a local matter, however, but a question of laws made by State or Nation. Tax money has to be raised by some means, but double taxation on mort- gage money presses heavily on those who have least.
There is a very common disregard for the community expense of small places. In a city of Essex County, some years ago, strenuous efforts were made to locate a prominent industry there, employing thousands of men. At once came three-flatters, - that ugliest and most economical of dwell- ings. These could be assessed, in those days, for not over $9,000 each, yielding $60 per family at a $20 tax rate. But these apartments averaged to send nearly one child per family to the public schools, and this at once used all the taxes paid, though the school expenses were only about a third of all municipal expenses involved. Furthermore, school expenses per pupil, as commonly given, do not include capital expense or money interest, and this city, as cited, at once was obliged to build more schoolhouses. Other communities show similar figures.
On Nahant the figures are in the same class; for example, the town revenue for 1925 is listed at $177,000, of which $34,000 was spent for schools. About one hundred and sixty-four houses on Bass Point, including Fox Hill and Castle Road, sent one hundred and thirty-five children to the schools. The total school attendance was about two hun- dred and ninety-three, or an expenditure of about $118 per pupil. For the Bass Point children this makes a total expendi- ture of about $16,000. On the official list of valuations for 1926, as published by the Nahant assessors, there are forty-
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TAXES, VALUATIONS AND EXPENDITURES
seven houses listed on Castle Road, with a total valuation of about $129,000, or an average of under $2,800. This, at the 1926 rate of $33, makes these houses pay about $93 taxes each, or a total for the forty-seven on Castle Road of about $4,300. If these forty-seven houses sent the average for this section to the schools there would be thirty-eight pupils, and at the cost of $118 each the expenditure would be nearly $4,500. This is more than the taxes received, and this is only for one item, though the largest one, of the town's ex- penditures. According to this same assessors' list there are about eight hundred houses in Nahant, and if they averaged to pay $93 each in taxes the total revenue would be less than one-half of the town's expenditures. Many of these outlays are proportional to the population. Certainly the cost of schools, fire, police, health, water and sewer departments may be nearly so; while for highways, public library, and several smaller appropriations there would be an increase as the population increased, though not proportional. The Bass Point illustration is only typical. It was used, with Castle Road selected especially, because this section and this short street are illustrations of divisions into fairly small lots, containing houses variable in size and cost, yet averaging to what a closely built-up town might expect to become.
Now assume an increase in Nahant from the present eight hundred houses to twenty-four hundred, with as many not used in winter and a proportionate school population. The . schools would then also triple in size and expenditure, - an added cost of $69,000 in 1925 figures. If protection to per- sons and property, together with health and sanitation, also tripled, this would add $100,000. Then add for new schoolhouses, some increase in other appropriations, of which the largest non-proportional one is for highways. The total would probably exceed $200,000. But at $93 each, the aver- age payment from the street used for illustration, the sixteen hundred added houses would contribute in taxes only $149,000, and this would not be an added sum, because the land newly built upon already pays taxes. The Castle Road houses
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SOME ANNALS OF NAHANT
cited use an average of less than an eighth of an acre each. At this rate the sixteen hundred new houses being consid- ered would use about 184 acres, now yielding over $30,000 in taxes. The increase in revenue to the town, therefore, from the addition of sixteen hundred houses of the sizes chosen for this illustration, would be less than $120,000. The increase in expenditures, though somewhat hard to determine, would obviously run heavily in excess of this sum.
The expenditure on Nahant per family is over $200, and each family benefits as much from any town expenditure as any other. Even in cities the same implication may be made. Somerville is able to spend about $30 per inhabitant per year, while Lynn, Lowell, Salem and most others can spend $40 with similar tax rates. Revere, another city notably a suburb of Boston, or chiefly so, only spends around $40 per inhabitant by using a $40 tax rate. The question presented is not of desirability of one group or another. It is merely the matter of income and expense to the town. Small houses on otherwise vacant land increase expenses faster than income. Vacant land does not use schools, and demands little from police, fire or highway departments.
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