Chapter XIII. The City Government and the Tax School

I found a city council of eleven holdovers and eleven newly-elected members, twelve of whom were Republicans and ten Democrats. My first move was to organize those of both parties who regarded the public interest as of more importance than party, against the crooked Democrats and the crooked Republicans. Frederic C. Howe and William J. Springborn were two Republican members who at once identified themselves with the administration. Mr. Howe soon joined us politically, but Mr. Springborn continued as a Republican for some time. I worked for his election as a Republican member of council the next year and later (after the State gave us a new municipal code which made the directors elective) for his nomination and election as a Republican on the Democratic ticket to the office of director of public works. I commenced at once to take advantage of weakened party lines and to do what I could to weaken them still further.

One of the first things which engaged my attention was the selection of my cabinet, and I made a good many mistakes in my earliest appointments. It was about a year before I really succeeded in getting an efficient set of directors.

There were innumerable matters calling for immediate consideration and I acted as quickly as possible in as many directions as I could. The secret of a good executive is this -one who always acts quickly and is sometimes right.

In less than a week after taking office I ordered uniformed policemen stationed at the doors of gambling houses and houses of prostitution having saloons in connection, and instructed them to take the names and addresses of all persons who entered. It makes a man mighty uncomfortable to go on record in this way, even if he gives a fictitious name and address. This method proved so successful as to the gambling houses that in a short time public gambling in Cleveland was practically abolished. I knew that we couldn’t rid the city of the social evil any more than we could rid it of private gambling, but I was determined to permit no saloon in connection with houses of prostitution and to destroy the pernicious practice of the police of levying fines upon unfortunate women. It had long been the custom in Cleveland, as in other large cities, for the police to raid these houses and collect a lot of fines whenever the funds of the police court got low. This simply amounted to blackmail and hadn’t the slightest effect in checking the evil, but rather stimulated it and gave rise to a horrible system of favoritism and extortion. I called my policemen together and told them that not a cent was to come into the city’s hands by this methods, that if the police court had to depend for revenue upon fines imposed in this manner, it would have to go without pay. Street soliciting by either sex was strictly prohibited.

You can’t legislate men and women into being good, but you can remove artificial stimulants to make them bad. Cleveland’s way of dealing with this problem during my administration compares very favorably, I believe, with the methods employed by any other American city. It became an established part of the policy of Chief Kohler – of whom more later – but the idea of placing a uniformed officer at the entrance to places of questionable repute did not originate with the chief or with me. It was a plan my father used while he was chief of police of Louisville, and he got if from Yankee Bly, a detective famous in Kentucky in the sixties and seventies.

I ordered a strict inspection of theatres and other public buildings. Made immediate war on bill-boards and ordered old frame structures torn down, put a force of “white wings” to work cleaning up the down town streets, inaugurated steps looking towards a better lighting system, set the law department to hunting up expiring street railway franchises, moved to reduce water rents, had a contest with the Pennsylvania Railroad over the ownership of twenty-nine streets, looked after some city cases pending in the federal court, established a department examiner to keep an eye on all departments of the city government, took down the “Keep Off the Grass” signs in the parks, commenced to institute people’s amusements in the parks and pardoned eleven out of fifteen applicants for pardon in the city workhouse.

I instituted a lot of changes at the City Hall, moving the health department from the third to the first floor, for one thing, so that a contagious disease patient wouldn’t have the chance to infect others by his presence in the elevator or in the corridors.

I refused to sign city ordinances unless they were properly engrossed. I insisted that everybody who had anything to do should do it the best that it could be done, and altogether we were a pretty busy lot of workers. So many things seemed to demand attention at once that I had my hand on every department of the city government before I had been in office a month. Of course all these activities cost money and as there wasn’t sufficient available money in sight, the usual howl of “extravagance” was raised. But I knew these things had to be done if we were to keep our promise to give good government and I went ahead and did them, trusting to devise a way to get the funds afterwards.

Under what is called economy in city government there is much foolish holding back of necessary public improvements. If fraud and graft are kept out there is not apt to be much unwisdom in public expenditures; and from the business man’s standpoint the return for the original outlay is very large – even where debt is created within reasonable limits.

With anything like an equitable system of collecting the just revenues of a city, the cost of these improvements, if paid in the first instance by tax levy, would be wise. Good sanitary conditions, public parks, pure water, playgrounds for children and well paved streets are the best kind of investments, while the absence of them entails not only heavy pecuniary loss, but operates to the moral and physical deterioration of the city’s inhabitants.

Limitation on taxes for public works is as foolish as limitation on increase in capital and plant of manufacturing enterprises. The question is not “how much do you spend?” but “how wisely do you spend it?” To economize on needed public improvements is worse than wasteful.

The generally accepted standard of values in this connection is all wrong. So obsessed have we become with the idea of property rights that we are constantly forgetting that in the last analysis we are dealing with men and women and children and not with things.

But to give “good government” in the ordinarily accepted sense of the term, wasn’t the thing I was in public life for. It was a part of our policy from the beginning of our work in Cleveland, it is true, but as a side issue, merely. While we tried to give the people clean and well lighted streets, pure water, free access to their parks, public baths and comfort stations, a good police department, careful market inspection, a rigid system of weights and measures, and to make the charitable and correctional institutions aid rather than punish wrongdoers, and to do the hundred and one other things that a municipality ought to do for its inhabitants – while we tried to do all these things, and even to outstrip other cities in the doing of them, we never lost sight of the fact that they were not fundamental. However desirable good government, or government by good men may be, nothing worth while will be accomplished unless we have sufficient wisdom to search for the causes that really corrupt government. I agree with those who say that it is big business and the kind of big business that deals in and profits from public service grants and taxation injustices that is the real evil in our cities and the country to-day. This big business furnishes the sinews of war to corrupt bosses regardless of party affiliations. This big business which profits by bad government must stand against all movements that seek to abolish its scheme of advantage.

It was these fundamental wrongs that I wished to attack and one of my first acts as mayor was to establish a Tax School designed to show the inequalities in taxation.

Peter Witt was put in charge with Newton D. Baker (who afterwards became city solicitor) as legal adviser and with numerous assistants.

The constitution of Ohio says that all property shall by appraised at its true value in money and the statute carrying this provision into effect uses the same words.

Land and buildings were appraised once in ten years by appraisers elected in the wards of cities and the townships of counties. These appraisers were expected to complete their work in a ninety-day period of time. New buildings as they were erected were added to the tax duplicate by the city annual board of equalization appointed by the mayor, which board also took care of the personal property returns, and was clothed with power to change gross inequalities in appraisals of land made by the decennial appraisers.

Steam railroad property, both realty and personal, was appraised annually by the county auditors in the counties through which the railroads ran. These auditors sat as a board and convened in the largest city of the various counties which the railroads traversed. Auditors were elected by popular vote.

Outside of cities there were assessors appointed by the county auditors whose duty it was to appraise personal property annually.

This, briefly, was the system of taxation in operation when we started our Tax School.

The local taxing board, or board of equalization, appointed by previous mayors, was in the control of taxdodgers. While it was really vested with great power this board had exercised that power principally in correcting clerical errors or in adding to the tax duplicate the value of additions to small property like painting houses or putting in bathtubs. The steam railroads, as had been stated, were assessed by boards of country auditors in the counties traversed by the railroads.

Small taxpayers generally were paying full rates, while the public service corporations, steam railroads and large land-owning interests were paying between ten and twenty per cent, only of the amount required by law. More than half the personal property and nearly all the valuable privileges were escaping taxation.

At first our Tax School was maintained by private funds and had no legal connection with the city government, but those in charge of it were granted the use of city maps and were permitted to call upon employees of the civil engineer’s department for help in connection with the maps. Witt was the first man I appointed and he object to taking the position, but I would not take “no” for an answer.

The clerks employed first copied the records in the county auditor’s office showing the assessed value of all lots and buildings in the city. From these records, on a map sixteen feet square and comprising one whole ward, we showed the inequalities in assessed values. Citizens in general and tax-payers in particular were invited to a large room in the City Hall, at one end of which this map was suspended. Pursuing this method by multiplying the number of maps the assessment of real estate block by block and ward by ward was shown. Discussion was invited, criticisms and suggestions asked for, and by means of this discussion, together with a searching investigation of the records of real estate transfers and leases, we ascertained the real value of one foot front of land by one hundred feet in depth, which method is known as the Somers unit system of taxation and without which no fair and accurate appraisal of land can be made.

When the unit values were finally agreed to they were written into the center of each block on the various maps. The members of the city board of equalization then signed the map making it thereby a public record showing the date on which the values had been agreed upon. Then a photographer made a picture of the map and negatives of this photograph were furnished the clerks who were at work in another room, and they, having the small maps before them showing the individual ownerships and the photographic records of the unit values, worked out and wrote into each space provided on these small maps, the actual cash value of each particular piece of land and the assessed value as well. The total number of subdivisions of land in Cleveland was one hundred and one thousand and the assessed values varied from two per cent. of to sixty-eight per cent. above the actual or market value.

We were not satisfied with getting this information to the persons who visited the Tax School. We wanted to reach every tax-payer in the city with it. So the Tax School issued a circular letter to the people of each ward, which letter set forth the cash value of all land in Cleveland, the appraised value of all land in Cleveland, the cash value of all land in that particular ward, likewise its appraised value, then the number of parcels assessed at less than the average value in the ward, citing the best know pieces as a concrete illustration; then the number of parcels assessed at more than the average value and again using the best known piece as the illustration of this point.

The city board of equalization, already referred to, was a municipal institution of long standing. Its members were appointed by the mayor. It was these members who signed the map in the Tax School and it was this board which would have corrected the inequalities in taxation had not the State legislature wiped it out by legislative enactment, and provided in its stead a board of review appointed by State officials.

This board of review was paid from county funds for a purely municipal service. To this board we sent the names of all owners and the description of their property which was under assessed. To the people we sent the letter already mentioned and requested all those whose property was over assessed to seek their remedy from the board of review.

So far as I know this was the first intelligent and concerted effort to relieve the people of Ohio of the injustice of the privilege in taxation which had been a decennial bone of contention in the State for eighty years.

By this time the Tax School was operating as a part of the city machinery, council having made an appropriation for its maintenance. The greatest of all privileges is the privilege of having another man pay your taxes and the beneficiaries of this unjust taxation could not stand our agitation, so on October 8, 1902, W. J. Crawford, the Republican boss, and a large property owner, brought suit to enjoin the expenditure of city money in this manner.

The case was carried through the courts, the temporary injunction was made permanent and the Tax School was eventually forced to suspend. However, it had now been in operation twenty months and its work could not be undone. Not only was it instrumental in making public service corporations pay sixty thousand dollars a year more in taxes, but, fearing the result of a tax fight, these same corporations made a secret settlement of back taxes at the end of his term with county auditor Craig who was their friend, by paying into the country treasury more than one hundred thousand dollars of back taxes.

The following year in my campaign for Governor of Ohio we dug out the inequalities in taxation in every city in which my tent was pitched and by the use of a stereopticon we showed not only the inequalities existing in Cleveland but gave many local illustrations as well.

Important changes in the State tax laws may be traced to the work of the Tax School. Land and buildings are now appraised separately for taxation and the old decennial appraisement has been replaced by a quadrennial appraisement and these quadrennial boards of appraisement, consisting of five members, are elected locally and at large without party designation.

Results thus far obtained more than justify the publicity methods which we employed to direct the attention of an indifferent public to this all important question of taxation.

The question of taxation was no less a State question than a local one. Indeed our whole Cleveland movement was more than local, more than a one city movement from the very beginning. The big lesson we started out to teach through the Tax School and in other ways was that taxation in all its forms, however designated, is merely the rule by which burdens are distributed among individuals and corporations. Farms, buildings, personal property, land, pay no taxes, yet so persistently have these inanimate objects been spoken of as being taxed that the public has all by lost sight of the fact that it is men and women who are taxed and not things. So long and so universally has taxation been regarded as a fiscal system only that comparatively few people recognize it for what it is, viz.: a human question.