Joseph McKenna

“ The 'rural' usually belongs to an association of farmers who live along the line. It comprises a switch board leased by the main or profit-making company to a rural manager, the main company owning the telephones on the line, and receiving the entire charge for toll messages, less the manager's commissions for collection. The roadways connected with a 'rural' are constructed and owned by the farmers in the same way as other roadways. The larger portion of 'rurals' are contracts with individuals. The percentage of corporations in the roadway and sublicensed lines is very small. ”

“ There can be no doubt that the purpose of the act was to extend to telegraph and telephone companies the provisions of the act of 1905, which provided for the assessment of the property of certain companies, and the levying of taxes thereon by the state board of assessors, and the method of collecting such taxes. Its title explicitly states that its purpose is to amend the title and the act relating to the taxation of railroads and express companies, and the particular sections which consummate the purpose are referred to and in § 1 declared to be amended. ”

“ If we add an ample allowance for nonreporting, nontaxable property, it still appears that the property which escaped taxation, and which forms the basis of the complaint, is not more than 1 per cent of the total.'
The lines may be divided into two classes: (1) lines owned by appellant and conducted for profit, and (2) lines connected with those of the first class, and called sublicensed companies, rural and roadway. There are 17 to 20 of the sublicensed companies which operate for a profit. ”

“ The profit that is derived from the rural and roadway lines is in the reduced rate for the telephones. The manager gets the difference between what he pays the main company and what he gets from those to whom he rents.
The difference, therefore, between the taxpaying and nontaxpaying companies or individuals is that the former, as said by the district court, belong to commercial corporations or enterprises, organized and conducted for the purpose of earning and paying profits as or in the nature of dividends ”

“ The power of exemption would seem to imply the power of discrimination, and in taxation, as in other matters of legislation, classification is within the competency of the legislature. We said in American Sugar Ref. ”

“ The cost of this nonassessed property, at the average reported cost per telephone of all reporting companies, would be about $145,000; complainants' proof tends to show such cost to be about $250,000; $200,000 may fairly be assumed as such cost; and upon the comparative basis used with the larger corporations, this exempted property would have been assessed at $120,000. ”

“ In Michigan the legislature has the power of prescribing the subjects of taxation and exemption, notwithstanding the Constitution of the state requires the legislature to provide a uniform rule of taxation, except on property paying specific taxes. People ex rel. ”

“ It is testified that the sublicensed companies run their own business, no control being in the main line. Their lines, it is further testified, were constructed by themselves, and the instruments either leased from the main company or owned by themselves. ”

“ Rep. 616, a law providing for the inspection of mines was held not unconstitutional by reason of its limitation to mines where more than five men were employed at any one time. See also McLean v. Arkansas, 211 U.S. 539, 53 L. ed. 315, 29 Sup. Ct. Rep. 206.
In New York, N. H. & H. R. Co. v. New York, 165 U.S. 628, 41 L. ed. 853, 17 Sup. Ct.Rep. 418, a law requiring railroads to beat their passenger coaches, but exempting roads of less than 50 miles in length, was declared not unconstitutional and discriminatory. To like effect is Dow v. ”