State Of New York et al v. Mnuchin et al

Filing 47

DECLARATION of Owen T. Conroy in Support re: 44 CROSS MOTION for Summary Judgment .. Document filed by State Of Connecticut, State Of New York, State of Maryland, State of New Jersey. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2, # 3 Exhibit 3, # 4 Exhibit 4, # 5 Exhibit 5, # 6 Exhibit 6, # 7 Exhibit 7, # 8 Exhibit 8, # 9 Exhibit 9, # 10 Exhibit 10, # 11 Exhibit 11, # 12 Exhibit 12, # 13 Exhibit 13, # 14 Exhibit 14, # 15 Exhibit 15, # 16 Exhibit 16, # 17 Exhibit 17, # 18 Exhibit 18, # 19 Exhibit 19, # 20 Exhibit 20, # 21 Exhibit 21, # 22 Exhibit 22, # 23 Exhibit 23, # 24 Exhibit 24, # 25 Exhibit 25, # 26 Exhibit 26, # 27 Exhibit 27, # 28 Exhibit 28, # 29 Exhibit 29, # 30 Exhibit 30, # 31 Exhibit 31, # 32 Exhibit 32, # 33 Exhibit 33, # 34 Exhibit 34, # 35 Exhibit 35, # 36 Exhibit 36, # 37 Exhibit 37, # 38 Exhibit 38, # 39 Exhibit 39, # 40 Exhibit 40, # 41 Exhibit 41, # 42 Exhibit 42, # 43 Exhibit 43, # 44 Exhibit 44, # 45 Exhibit 45, # 46 Exhibit 46, # 47 Exhibit 47, # 48 Exhibit 48, # 49 Exhibit 49, # 50 Exhibit 50, # 51 Exhibit 51, # 52 Exhibit 52, # 53 Exhibit 53, # 54 Exhibit 54, # 55 Exhibit 55, # 56 Exhibit 56, # 57 Exhibit 57, # 58 Exhibit 58, # 59 Exhibit 59, # 60 Exhibit 60, # 61 Exhibit 61, # 62 Exhibit 62, # 63 Exhibit 63, # 64 Exhibit 64, # 65 Exhibit 65, # 66 Exhibit 66, # 67 Exhibit 67, # 68 Exhibit 68, # 69 Exhibit 69, # 70 Exhibit 70, # 71 Exhibit 71, # 72 Exhibit 72, # 73 Exhibit 73, # 74 Exhibit 74, # 75 Exhibit 75, # 76 Exhibit 76, # 77 Exhibit 77, # 78 Exhibit 78, # 79 Exhibit 79, # 80 Exhibit 80, # 81 Exhibit 81, # 82 Exhibit 82, # 83 Exhibit 83, # 84 Exhibit 84, # 85 Exhibit 85, # 86 Exhibit 86, # 87 Exhibit 87, # 88 Exhibit 88, # 89 Exhibit 89, # 90 Exhibit 90, # 91 Exhibit 91, # 92 Exhibit 92, # 93 Exhibit 93, # 94 Exhibit 94, # 95 Exhibit 95, # 96 Exhibit 96, # 97 Exhibit 97, # 98 Exhibit 98, # 99 Exhibit 99, # 100 Exhibit 100, # 101 Exhibit 101, # 102 Exhibit 102, # 103 Exhibit 103, # 104 Exhibit 104, # 105 Exhibit 105, # 106 Exhibit 106)(Conroy, Owen)

Exhibit 15

HUGHES IS AGAINST INCOME AMENDMENT: Tells Legislature it Gives ...
Special to The New York Times.CHARLES E. HUGHES.
New York Times (1857-1922); Jan 6, 1910; ProQuest Historical Newspapers: The New York Times
pg. 2

HUGHES Is .AGAINST
INCOME AMENDMENT ,
.

·.

I
!I

. t
T e II S L eg1s Ia_ure "t a·IVes
I
Government Powe; to

stat e · an d

M

· ·

l
Federal;
i

i

1

n

•

.

1

WOULD IMPAIR STATE CREDI T•

;

I
'

Governor Favor:; Federal Power to Tax

'I

I

stitutional Change Propose d •

l!,

10

1'1rc

I
I

Yor): Ti,.:cs.

I
I

I
I

!

_y,,_
...

I

I

I

1

src.-ial

I
II

!

Incomes, but Not Sweeping Con·

I

:

I

!'

1

the Constitution· itself. which, if ratified.' Pollock case diffet·ed in oplnlon upon the
wiil Ce in effect a grnnt to the Federal f;'l£stion whether a tax upon h1como from
Go\·ernment of the power which it defines. prcperty was a direct tnx and as sue:h
The· comprehensive words. "from what- could not be laid without apportionment,
ever source derived." if taken in their they were unanimous in their conclusl'on
natural sense, would include not onlv· in- that no Federal tax could be laid upon
comes from ordinary real or personal the _income from municipal bonds. l\fr.
, uroperty, but also lncomei; derl\·ed from J11st1ce 'Vhlte, who dissented in the PolState and tnunicipal. securities.
1>,
lock cas<> with r<->•rnrd to other riuestions
It may bi:! l!rged that the an:1endment I as to this said, (f:i1 u. s. on p. 6:i2;)
·
would. be hm1ted by construction. But 1
Tl
th I I
It
dec1~1"~uot~hi~":ugsti~n. 1 n-r~~; ~f~n,!g1r;,\'!~~
1tl1Ere. can be no sat,isfactory assural'!ce
~ ~f th~s. The words in termi< art; all _mto one case and not to the othc·r. because In
<!ushe. An atpendr.ient to the consutu- 1 tile one case there 1,, full pow<'r ln the
!JOn of the l. nitE!d States ·lij the most
Federal Go\·ernment to tax, the only cannnportant of pohtical acts. and the:e
tro\·ersy being whetlwr the lax imposed Is
o;;houlcl be no amendment expresi:.ed m
direct or md!rC'ct; while In the Other· there
: >'Uch terms aR to afford the oppol'tunit~·
ls no P·>wer whatever In the Federal GO\·1 ei:-nment, and. therefore the !e,•y, whether
for Fedeo-al action jn violation or the I
rumlamental conditior::; of State authorJt.y.
d•re<'t or lndireC't, Is beyond 'the taxing
I an1 not now referrlng.).o the advantag·~
power.
-'
which the States might derive from the I Jt is cer.tainly/slgnificant that the words.
exdush·e power to tax incon1es from prop- "from whatever source derh·e<l," have
erty. or to the argument that for this been lntroducecJ lnto the proposed amendI rei1son the 11ow .. r
to tax such incomes !neut as 1f It were the Intention to make
! :;:•ottlcl be wl1hhPld from ti1e Federal Govit impossible for the claim to be urged
"r.nment. To that argument I do not as- 1 that the income from any property. even
•
sent.
, though it consists of the bonds ·or the
referring
authoror of a municipality organized by it,
I I am tnx which to a proposal to in fact Statebe remm:ed from the reach or the•
1 ize
a
might be laid
will
uv<'n the iu::trumentalitie:; of State Gov-j taxing POW<>r of the. Federal Government.·
''rumPnL ln order that a market may be The 1mnu1nity from Federal taxation that
p1·0vid,,:d for State bonds, and for munici- 1 the State· n.ncl Its Instrumentalities of go\·pai bon<l><. nn<l that thu" m<mni; ml:!y he 1 ernment now enjoy ls derived not· from
·'nfforded for State a~d local 8<dmtm!"tr.l-' II al!y express provision of the Federal ConHou, 01.:ch securities rrom Ume to time st1tutfon, but, fr<!m what has been· deemed
. nrf! excepted from taxation. In this way to be necessary ihlplicat!on. \\'ho can say
l0w"r 1-.tte!' of interest. are patd tha.n j that any smch implication with respect to~
oti:arw1s::- would be possible. To 11erm1t the Prop0sed tax w.111 sun·lve the adoption
s1.d1 sec1..ntie!' t11 lJe the subject of Fed-1 or thfs .,explJclt and comprehensiye amendera! taxatwn 1s to place such limitations ment '!
·
.
ti!JOll the borrO\vin~ "power of the State
\V·l:> canll'Ot suppose that Congress will
«S to wake the performance of the fun<'not seek to tax incomes <lerlved from
:Jun>" of local Go\•ernment a matter or s~curit~es issued by the State and its muFederal grace.
.
mcipalttles. It has repeate<ll~· endeavored
This h:i.s been re11eatedly recogmzed. In to Jay i;uch taxes and Its efforts have:
i he <'ase of the CollPctor ''- Da)-. (Jl \Vall. bee.1 defeated only by implied constlt:uon P. 1!:!7.) decided in 1870, the United tional restriction. which this amencrment
f State" Stmreme Court i,:atd:
threatens to tlestro:-·. \Vlt!le we may deIt 1~ ndmitted that there I" no express 1 sir". that th.e Federal Government may be,
prO\·islon ln the Constitution. that prohibits i equipped with all necessary National powthe gcn<>ral GO\·ernment from taxin.F the . ers 1n order that It may perform Its Nain<-an" and instrumentalities of the StiitNl, ; t_lo_nal function. we must be l'qually soI nor is th""" any prohlblt_ln:: th<> State" from I hc1tom; to secure the essential bases or
taxlni:- the m<'ans and m~trume11talltle;1 ~r
State Go\'ernment.
I that Go,·<>rnnwnt. ln both C'aSl"S th<> exI therefore dei:>m It niv dutv ai; Gov~
: emotion n·st~ upon neces~ary lmpil<'atiun.
ernor of the State to recommend· tl'iat this
•
.
•
I
b,· the ::reat law
I ani.l 1~ upheld as. any Gove>rnment,oc· ,,,,1(. I J1!0110set1 amendment Sl!OUl<1 no! b~· ratprl"ser.\'atlon:
whose
I m1>ans <'mployNI in .. omluctlni: Its opPra, tfied.
CHART~ES E. HlJGHES.
tinns If sublec-t to the control of another I
antl distinct ·Go,·ernnicnt. cnn exist nnly at j

I

Tax 1·
I Bo ds
\:

un1c1pa

,

A LBA:XY. Jan. :..-The joint resolution,
passed b~- Con;;n·"" and submitted to th.;,
i.-arious State J.e:;dslatures for ratifica-:
tion. which pro\·hk" for an amendment I
1
to the Constitution of the l"nitcd State>'
gh·ing the Fedt:'ral Go,·ernment power ~o
le,...-'.· tax('s ,, 11 inconws without aopor- ,I
tion1nent among- the States, ·was made the
!=Uhject of a spel'ial lll•!!'>'age which Gov.
Hu::rhe" !'rnt to t llf' Legh,lature at .its j'
opening ><ession to-<la~·The resolution!
of <.:ongrcs'• was atloptcd on the recom- .
mt-ndat ion of
President Taft.
GOY. !
.
'f .
f
Hu;;h ... ,., while ('Xpre,.:,;m;:; him:;e, m
aYor of plaC'ing· hC';'OlH~ dispute the. Ft:d-1
c-•al power to Jeyy an meomE" tax without I
o.pporthnment. com"" out >'quarely again;;t,
th e rr~::u 1u t'm n ,;ane 1· 1 ecJ ti· the Pre·' i
10 1
)·
,.,c'lent. on th·" grountl that the proposed 1
am<'ndemnt as lfla!'sed by Congress woul•I I
render State hontls or tho:;e i!~sUed hy;
munidpalilie,; l"uhj<'<:'t to Federal taxa'l.ion. )
~~-':.1111;.';!:'~h:!.., ;~~:!n.?~t';,".;'o'r~~:·po~~r ~~~":)~
•. To nlace the hf)rrowing capacity "f '
'
tax them al discretion?
Tn
\'F<.
Farmers'
th., Stat.,. and or 'its go\'ernmental agenI Lean th~ case of Pollock <1:11. r.r. _s., on
aml Trust company.
cie!< at ~he.' m .. rey of the Federal taxing,
, pp. r.84-:>,) Chief .Tnstic<" F~ller said, rE>- :
power would be an impairment· of the e,;- I .,00 for such . a discrimination has been
ri:rrin? to the tax urmi;i, . J11{•oa1ei< froi;~ I
sential rights of the State,. which. ~s lLS
or "an ?" sui;-~ested. Hd •• P._ 680.)
j~~~J~.:fc al bonds. one or_ t..C; matters. the.1" !
offfcers. we are houn<l to defend,
th~ Fl am In~ f~-' or of conferring. upon th~
A municipal corporation ts t!'\P representn- ~
GoYernor say"' in l1is message,
;:;ge~Ale~:"':~nTn~r::i~i 11 iaJ1°'~-elj tot Ia)
tl\·e or. _the !"tate aml on•• or th<> ins1r11- 1
.• 1 ,•
~ •
r o 11ows.
•
..
•
- '1\1 IOU ap-. mentalitH?s of the R~ate Gon·rnmcnt, It
Tl ie speci:i mrssa,,e Is as
ponionment among !he States :-_ccordingl was Joni!' a~o determined that the property
To the Leg-1l'lalure:
.
! ~o P?i>ulat1or.. I bethe;·e that this power nn<l re,·<'nnes o.r, 111 unirlpal <'O"poratlon,. ar.. .
I ha,·e rec<'h·ed from the· Secretarv or 1 l-'hou,d be held b:!>· the FC;dera) Go,·ernmenl
~ubj"c~s <•t?
rn~:at!cn.
• •
, .
.. ·
j so as pr!J):'erly to equip 1t with the n1e:i.11s not th<' J>ropert~· Fe<kral "·ant or the • Scat<>s /1
nut we t111nl' the same
nf pow..r to
State of the I . mte<l State" a certtf1ed copy of 1neet1ng National exigencies.
tax
or 1"P\·<'nt1<'s
of a resolution of Con~ress entit~e,l .. .Joint I .,.1 ... p
t
t St
or their 1t1strumentallll
cxl8ts In rel:•tlon
0
•
•
_
"
Di!h.
ro ec
nte llonll IMsuefll.
to a tax on the income from their securities.
Resolutmn Propo,;1ng an Amenomen: to I B
h
.
.'
'· .. 'the Constitution of the l:nited States," n ut l. e pov.er to tax income::; shouhl Pre11cnt Exen1ptlon l•~· Conetrne~lon. i
and in accordance with his request I .. ub-1 j1oott ~e ~adntedl ln such te.rms as to subIn the same case l\Ir. Justice Field said!
. J•
bl b d
r
h 1 c
o
e era taxation the incomes de-1 (Id
_.
1
mi1. • t~ you~ 1lOnora e 0 '.:i or sue
rh ed from bonds issued b;1· the State it· on I>- 001 .J
,·
-·
action as rn;i.~ be had thereon.
"olf or fho'-'e i "U d b. l\f.
.. .
Thc>:e uonds nml securltle" are ai; Im- 1
'
·
•
~
s. e
:li
un1e1pa! Gov- 1 portnn< to the performance of the duties of
'The Propot1ed Amendmen't.
e1·nm2nts org-anizeJ under the State's au-• the State as like bonds and securities or the I
d
od b Y tl. Join t th 01 lt. • T o P 1ace t h e borrowing capacity
- .
.
l•nited States al'e Important to the per· I
Th e amen ment propos_
lls
~
formancc or their duties, and are as exempt· :
resolution, adopted b~· two-third~ of both or ·he State and ot" its go\·ernmental
from ·<he taxatlol) of the l'nited States ~s I
Houses of Congress is as follows:
agencies at the mere'· or the F d
' t .
the fo:mer are exempt from the taxation f. I
•
.
"
e era, axthe States
·
Article XYI. Thi' COllS'l'CSS shall ha;·e
mg power WQU!d be an lmpalrment or the
l .
'
' ~ I
power to Jay and collect taxes on incomes 1 es.sential rights of the Stale which as i
And t~ 1 <: )P..arned Jus~ice. ad!led, •.. uotln.,,
.
•
from whatPver snurl'e derh·ed without ap·
ts' from l.il!tted States \s-,,.,Y,ta!,1;;2ad Com0 \£icers, 111 eala re bound to def-end. .
portionment among the se\"t•ral states, and
pan.\·, (11 "·all. on pp . ., __ , .,_,,) as fol-..·lthout regai-d to any census or enumeran'tf_ou are c 1ed upon to deal with a !:'Pe- tows:
.
1
ti
/
~ 1c proposa1 to amend the Constitution
on.
·.
aud your action must neces!:'arilv b 0 : I
The right or ~he States to administer their
The power to la~· a tax upon incomes, t.-.rn1 in<?d not by a general consiueriu:n
own aflairs tht:ough their lcglslalh·e. <-xec.u- I
without apportionment was Jong supposed .of the propriety of a just Fe 1 ·al .
J tlve. and judicial d"partments, In their own I
•
ta . 0 1• r :rl ••
·
' ei
income j manner through their own akencles. is con· I
to be posses:-;ed by the ·Federal Go,·ernth~ o ~,~~ ~ ;,-:; fh": J;'ederal Governceded b~- the unlrorm dccisif:m or this court,
1h
ment and has been repeatedlv exercised. w·1etl•er o/" 0
a)Usuch a tax, bl!t I and by the practice or the Federal Govern1
.
• •
•
not t e !Jar cular proposal 1s'j ment crom its. organization. This carries
Such taxes wer!" laid and pat~ !or the Of such a character as to warrant your• with it an exemption of those agencies and
purpose of meetmg the exigencies caused as1;1::~lt.
.
· Instruments rrom the taxing po\'\·cr or the
by the ch·!l v.·ar.
This proposal rn that the Fedel'nl Govl<".,deral Go,·ermnent. l f th<'y mJ!.Y be taxed
In 189.:> In the case of Pollock'°"' Farm- ernment shall have the power to la...- and
Jlghtlv they may be taxed.hea\'ily; If justly,
ers' ·Locan and Trust company. n:.:s u. s. cvikct tax<:s on incomes •• from whatever
oppre~"!ve1y: Their opcrat}on may be Im601,) the United States Supreme court sour<,:e derived."
pe<led and may. be de.•tro~ ed If any Interdecided that taxes on the rent-<!' or· inIt is to be borne in mind that ti · ·
rerence Is pernutted. HC'ncc the beginning
come of real estate, a~d ta.xcs on. Personal ~ ot a 1_pere s. ~atn):e to be c'?niztrueti 1:i~~~
~fa!~~~ ~g;9c\~1~!d ~~t t~~o~~~~.~n the· one
property or on the income of perst,nal
g tt o,. conshtuttonaJ restrictions. expre1;s
..
property, are dire<:'t taxe!' and hence un- or fmp11eJ. but a proposed amendment. to
"'hile the Justices· of tho coi1rt in the'
der the Constitution cannot bf! imposed
.. - - - - - - - - - - - - - - - - - - - - - - ·without apportionm('nt among- the "e,·eral
States according to their respeclin;i populations.
It -..·as not the function of the court. ancl
it did rot attempt. to decide whether or
not a Federal income tax wal< <lei<irable.
It ~imp!,. int,..rpre~e:l the Con,..ritution according 'to tn<>. judgment of the majorit~·
·of it" m<'mbers and left the quel!tion of
the ad.-isabi111Y of conferring- such a -power upon the Federal Go,·ernment to be
·de•errninc·d in the constitutional method.
'T'he limitations so placed upon the Fed<::ral taxin!?' power arc .thus. describe".l ;by
:!\fr. Just11:-e Harlan 1n 111s d1ssentmg

I

I

I

I

I

I

I

I

""

i

!

I

l

I

I

I.

I

I
I

I
'1

1

I

0

"

I

'

I

I

I
l

I

I'

i&:nt

I
I

I11 1

opinion:
.\ny

.
·
att .. rnpt upon the riarl of Congress

:it,?l~1rti6n n1nCJnt: tlle :;.::;:tatrs.. 'l!!>On the
b~s1·:; ~in1U1y or thC'ir population, taxation
or n~ ... ~t,),::J,] propcrt~· or
in<.,-ornes,. wou1d
t'•nd !o ai·n:.:;se such indi~nation a.n1on:: the

tn

or

frt.·e:11rn (lf ;\.111erh:a that 1t 'vouUl never

br r"'n"a t~d.
"•h<·n. therefon;. this court
at:1jud,e;f's. a~ it docs no't\~ aCljud;.:;"e,. that
C!ein;;-u"(Os <.•annJL in1pose a duo· or tax upon

y:er;vn.il p1·onerty. or upon income arising
either fN:n 1·cnls of re:tl estate or from,
p1·r.so11al P'""-'!·<"'r:s. ;ncludlng in\·ested 11er-

f"Ollc::!'J propP.t-lY~ hand~. stoPk~ and in,~est­
m<"nl~ .,r all kind". P:>:cept by apportioning
th~ su1n to be ~o l-aist!d a1nong the States
a!."conJh1~ to population. it vr:ict kally de· c:Ge.s

that .. without an amendment Qf the
<:'"'-"!1H:ft::•!.!on-t:wo-thirds of both House.c:;

o- • ·,:m:.:rP!!!i a.nc! thre'-•-fourths of t!:'e States
r.-nc-u•l!nc;--suc-h property and incoi.:es can

r.'•'\'' r

• J ·t!:.

t-t!'
t-':'

111:ttle to 1•ontribute to thH sup-'

H1e

Xat!onal

r·· . ,,1_ ::.) • • •

Government.

(id .•

1nc-ona·s ar.tsinr; ·from tradei. employ11:• nt "· ealllnzs. and - vrofessions can be
1 '.)t'"••l
ltnder thP rule of unlformit,.. or
- 141t.:mJi:.r. 'by both the .:-.;at!onal Go\·ern-:1-:lf::nt anil the rf'sr>eeth~e State governr.~ent~. "·.;hile- incomt.•s fron1 property. bonds.
Et<lcks. •!"'•'' in·•estments <--annot .. unilPr the

present dec!shm. r.e taxed by the :-<ational
Gol'ernment P:S:• <'!It under the impracticable

rule

of ayn;lllrti•1nll'!C"nt

QeCOrJing

ill

a.mong

p1.1i1ula.'ion.

the

States

Nil sound :rea.-

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.