Chapter 22
Accepting Allen’s invitation to come in, Blueblood stepped across the threshold, “I’m sorry, I would have come earlier, but duties back in Canterlot kept me busy far longer than I anticipated,” he apologized.
“That’s alright, though you did miss a nice party,” replied Allen with a small smile.
“Yes, I know. A, Ms. Pie sent me an invitation.” Lighting up his horn, he pulled a pink-colored envelope from the breast-pocket of his suit jacket, and remarked dryly, “How it got past my secretary, neither I nor she knows, and I must say she is rather put out by this situation.”
“From what I’ve seen so far, I think that’s just how Pinkie Pie works. I’d just tell your secretary to not take it personally, and try not to think about it,” replied Allen easily.
Blueblood nodded. “I’ll be sure to pass that along to her when I return. Though, I suppose it might have been for the best that I missed the party. My presence can cause the citizens to... act strangely at times.”
“Let me guess, they all try to suck up to you at the same time?”
“That is, one way to put it I suppose,” remarked Blueblood, a hint of bitterness in his tone. “In any case,” he continued, the bitterness gone, as if it had never been there in the first place, “that is not why I am here tonight.”
“And why are you here?”
“I’m afraid that I’ll be out of the country for the next few weeks and as such, I felt it necessary to review and finalize our initial contract. I’ve brought one of my associates with me so that you may have a point of contact that can speak for me should I not be available, and so that she may help answer any questions that you may have that I can not.”
Poking his head back across the threshold, Allen looked around but didn’t see anyone else besides a pair of pegasi strapped into an open chariot out in the driveway. Looking back to Blueblood, Allen asked, “Uh, are you sure you remembered to bring her? Cause I don’t see anyone but you and those guys,” he said, pointing to the two pullers.
Just then, the sound of someone throwing up could be heard from around the corner of the house.
Letting go a weary sigh, Blueblood stepped back out onto the porch. “Would you excuse me for a moment, please? It seems my associate failed to take her anti-airsickness potion before we left Canterlot. I’ll be right back.”
“Uh, sure, take your time, uh... do you guys want anything? Water, juice? I can get that ready for you while I wait if you want,” asked Allen, a little off-put by the sounds of continued retching coming from the side yard.
Guess I’ll need to bury that sickness in the morning, yuck.
“Some peppermint tea, if you would, it helps settle upset stomachs,” replied Blueblood as he trotted towards the sounds of dry heaving.
“Sure... I’ll go see if I have any. When you’ve got her squared away, just come on in,” replied Allen as he retreated back into the house, his own stomach now a little upset itself.
Nodding absently, Blueblood waved a hoof in dismissal and trotted around the corner out of sight.
Allen for his part quickly returned to the kitchen and pulled out a bag of herbal peppermint tea and set a pot of water to boil on the stove while he waited. Thankfully, he didn’t have to wait long as a few minutes later he heard the front screen door open, then shut, and a pair of hoof steps come down the hallway. Though one sounded a bit unsteady at the moment.
Pulling the now boiling pot of water off the stove, he quickly set the tea bag in it to steep, as first Blueblood, then his assistant entered the kitchen. Turning from the stove, Allen regarded the miserable-looking mare with a sympathetic eye. Her auburn colored mane looked a mess as some of it had escaped from its formerly tight bun, while her bangs hung down limply in front of her face. Her teal eyes were slightly bloodshot and puffy, probably because she had just thrown up a minute ago. Her navy blue suit jacket was also slightly rumpled, and her white collared shirt didn’t look any better, as Allen could see several prominent wrinkles in the fabric and a possible stain near the collar. Finally, he noticed that her light gray fur was slightly damp from sweating and that she was breathing somewhat unsteadily. Overall, she was the perfect picture of someone having a sucky day.
Handing her a steaming cup of tea, he asked, “You feeling any better?”
Taking the mug from his hand in her unsteady azure-colored aura, she nodded shakily. “Yes, thank you, I’ll feel better in a few minutes. I-I always tend to get nauseous when I have to fly, even if I take an anti-nausea potion before hoof,” she replied unsteadily.
“Do you want any honey with your tea?” asked Allen as he reached into the pantry to pull out a jar of golden honey.
Nodding the mare replied, “Yes, that would be lovely, thank you.”
Giving a nod in reply, Allen grabbed a couple of spoons from the nearby draw and set them along with the honey jar on the table. Handing Blueblood his own mug of tea, he poured one for himself before settling down in his chair. Both Blueblood and his assistant quickly took their own spots and set about adding their preferred amounts of honey to their drinks.
Taking a sip, the mare let loose an appreciative hum as she felt the soothing liquid flow down her throat and settle quietly in her belly, helping ease the tension still present. Setting her mug down, she flashed Allen with a thankful smile and said, “Thank you, that tea was just what I needed.”
“You’re welcome, my dad’s side of the family has always had stomach problems, so we tend to drink a lot of peppermint tea to help with digestion,” replied Allen, a sympathetic smile on his face. However, that smile was quickly replaced by a small frown as he regarded his evening guests.
“So,” he began, “what’s going on? I had thought we had more or less ironed out our initial agreement.”
Blueblood, seeing that his associate wasn’t quite ready to speak yet, went first. “We did, however, we still need to review and sign the contract, and if we want to move forward, we need to get them taken care of before I leave tomorrow morning for Olenia.”
“Okay, so what’s first then?” asked Allen as he leaned back in his chair in an attempt to get more comfortable.
Turning his attention to his associate, Blueblood motioned for her to speak. Nodding, she lit up her horn and pulled out a pair of half-rimmed rectangular glasses from her front jacket pocket and settled them on her muzzle. Reaching under the table, she lifted a faux leather suitcase up and gently set it down on the tabletop. Popping it open she pulled out several sheets of paper and set it in front of her before returning the briefcase to the floor.
Taking a moment, she organized everything to her satisfaction and then looked up at Allen with a business-like expression on her face as she laid her hooves together in front of her on the table. “Before we go any farther, Mr. Ross, I would just like to properly introduce myself to you, and tell you what I do for His Grace.”
“Alright,” said Allen.
“My name is Penny Farthing,” she began simply, “I work as both a lawyer and accountant for His Grace, and have done so for a little over two years. Normally, I work with one of the more experienced members of His Grace’s accounting or legal staff on projects. However, His Grace has decided to give me this opportunity to show that I can handle a full-time account in his name.”
“An accountant and a lawyer? That’s pretty impressive,” whistled Allen.
Penny felt a slight blush creep up her face, and stuttered out, “W-well, my mother is a lawyer and my father is an accountant and they would take me to work with them a lot, and I found I liked learning about both their professions. So when I went to Manehattan University, I couldn’t decide which career I wanted to do, so... I did both.”
“I... see. That must have been a lot of work for you to do,” replied Allen, impressed at her accomplishments, “I didn’t even finish college, only did two years before I dropped out. Though I have taken a few technical classes over the years to learn things like welding and repair.”
“I will admit, even with everything that I knew before I went, and the fact that I had my parents to help me, it was still difficult at times,” replied Penny, as she recalled many sleepless nights cramming for tests.
“Alright, so what have you done since you graduated?”
Clearing her throat and adjusting her glasses, she said, “As I mentioned earlier, I have been working with His Grace’s more experienced staff members helping return his family’s fortune back to its previous heights. We’ve managed to accomplish a lot over the time I’ve been here, but there is still a ways to go.”
“Right, I heard about what happened,” said Allen as he took another sip of tea.
Nodding, Penny gestured to the small batch of papers in front of her. “His Grace feels that there is a lot of untapped potential in this area. I am not sure how much you know about how the nobility makes money here in Equestria.”
“Not much, I’m afraid,” replied Allen honestly.
Giving another nod, Penny said, “Well, put simply, many nobles own land that other ponies live on, these ponies pay taxes to the local noble, who in turn is supposed to use part of that money to provide basic services to those on their lands. In addition, they are to send a portion of the money to The Crown to be put in the general treasury. Whatever is leftover they keep as a sort of stipend. Now, not all land is owned by nobles, much of it is owned directly by The Crown, which means that the taxes from those lands goes to the Princesses to do with as they see fit.”
“Okay, so do towns and cities collect local taxes then?”
“Some do, others do not,” replied Penny with a waggle of a hoof, “for instance, Ponyville will collect taxes from the surrounding area to help upkeep the local services. However, the town of Dodge Junction does not collect any taxes from its residents, and instead relies on The Crown to provide the needed funds to function.”
“That sounds kind of confusing to me,” said Allen as he scratched his head.
“It can be for someone not used to the system,” replied Penny easily, “the main thing to remember is the population size and whether or not a noble is involved. The larger the population density, the more services are required, therefore, the more money is needed. As such, the local municipality will generally levy a local tax to help ease the burden on The Crown’s coffers. This also helps reduce wastage as suddenly it's the local pony’s bits that are now being used instead of the entire country’s. Therefore they have an incentive to keep spending low. In the case of someplace such as Dodge Junction where the population is low, there is no local tax applied which helps ease the burden on local businesses. This in turn incentives ponies to move there and develop the land further. If a noble is involved they usually hold large tracts of land and therefore require bits to properly administer it. The Crown allows the noble to collect taxes in The Crown’s name with the understanding that the noble will use the bits wisely to keep the local services working properly, and that they will pass along some of the money to The Crown. The same also applies to sufficiently sized municipalities as well.”
Leaning back in his chair, Allen rubbed his chin thoughtfully as he digested this last info. Finally, he looked at Penny and said, “Alright, let me see if I have this right. So, everyone gets taxed by The Crown, no matter where you live right? It’s the default way to pay taxes.”
“Correct, if you live on land that is owned by only The Crown and there are no local taxes, then you only pay a tax to The Crown,” replied Penny with a nod.
“Okay,” said Allen, “but if you live in an area that is controlled by a noble, you only pay a tax to the noble, who then passes some of it along to The Crown, right?”
“Essentially, yes,” she said as she readjusted her glasses, “though there are some exceptions to this rule. However, for simplicity's sake, we won’t go into them as they do not apply to you.”
“Okay, so does that mean taxes in those areas are higher?”
“They can be,” replied Penny, with a nod of confirmation, “but The Crown tends to keep a very close eye on taxation rates. Every noble and municipality is required by law to submit a yearly budget and tax report to The Crown for approval, and is also required to submit a formal request should they need to raise taxes in the middle of the year for any reason.”
“Princess Celestia has learned the hard way what damage a tyrannical noble can cause to the nation when they are not kept in check,” cut in Blueblood. “As such, she has placed hard caps on what rates a noble can tax for a given population density and wealth index. Moreover, she has instituted severe consequences for any noble caught breaking these laws,” he finished, a dark look on his face.
“What kind of penalties?” asked Allen curiously.
“Usually they are stripped of their titles and wealth, and unceremoniously kicked onto the streets penniless, and I do mean kicked in the literal sense of the word,” clarified Blueblood.
Allen tried to suppress a snort of amusement as the image of a puffed-up noble getting unceremoniously bucked out of the royal castle onto his flank, flashed through his mind. “I can imagine that doesn’t happen very often,” remarked Allen, a slight smile on his lips.
Blueblood shook his head. “No, but it does occasionally happen from time to time, and when it does, the nobility is given a painful reminder of why Princess Celestia has been able to rule Equestria by herself for a thousand years.”
“Okay, so in my case, how am I affected by taxes, after my tax break expires next year?” asked Allen as he took another sip of his tea.
Penny adjusted her glasses slightly and glanced at one of her sheets of paper. “Well, this area is part of the Grand Duchy of Canterlot, which His Grace,” she nodded her head at Blueblood, “controls. As I mentioned before, municipalities and nobles can collect taxes in the name of The Crown. However, it is usually either one or the other, not both, as that would be considered double taxation, and most pony’s dislike being taxed twice for living in a certain area. Instead what happens is that the municipality will tax those that live within its boundaries and take a cut of the revenue to meet their budgetary needs. They will then pass what is left onto the local noble, who, in turn, sends The Crown its share of the revenue first. Whatever is left over afterwards is then used to maintain services within the noble’s lands that are not covered by the municipality, anything that is left is theirs to do with as they see fit.”
“So, that means that when I pay my taxes, I only have to send them to Ponyville? No where else?”
Penny nodded. “Essentially yes, as you would be relying on Ponyville for most of your services. Such as power, fire protection, police, healthcare, etc. However, if Discord had dropped you near a smaller town, such as Pine Top, which is further west of here, then you would only pay taxes to His Grace, which would be cheaper, but you would receive fewer services in exchange.”
“Okay, so instead of having to pay taxes to local, regional, and imperial levels, you guys just mail your taxes to whoever runs the local area and they divvy it up as needed,” said Allen, a slightly confused look on his face as he tried to wrestle with the concept.
“For the most part yes,” interjected Blueblood, “this system is something of a holdover from the more feudal days of Equestria when nobles were more powerful, and it was harder for The Crown to oversee all of their lands effectively. Nowadays, that is no longer the case, but the system persists relatively unchanged, as since nothing major has occurred to warrant said change, most ponies don’t see the point in upsetting tradition.”
“Sort of a, ‘if it ain’t broke don’t fix it’ mentality?” said Allen.
“I suppose that is one way to put it,” replied Blueblood simply, “however it is more than that. If the tax laws were to be changed, it could upset some very influential ponies, as they could lose out on a substantial revenue stream. As such, Princess Celestia has decided to just let sleeping dragons lie until they have to be woken.”
“Yeah, people generally don’t like it when you take their money-earning potential away from them,” remarked Allen dryly.
“Quite,” agreed Blueblood, “though if us nobles were to lose access to our cut of tax revenue, for most of us it would be a minor inconvenience at worst.”
“I’m assuming that would be because you have a diverse portfolio of revenue-generating options?” asked Allen as he finished off the last of his tea.
Blueblood nodded in confirmation. “Indeed, in many cases, nobles will use their portion of the tax money to invest in local businesses and other ventures as a way to both increase the tax revenue of their holdings, and to earn bits from their investments.”
“And so that’s why you’ve taken an interest in my farm,” remarked Allen simply.
“Essentially yes, and another reason the DOTI and the nobility do not get along, as we often view them as competition in regards to investing in the Equestrian economy.”
“Which brings us back to the original point,” cut in Penny as she shuffled her papers around, “His Grace has asked me to oversee this joint venture in his stead, as he will be out of the country for extended periods of time. Naturally, I will be sending him regular reports on our progress in developing the economic potential of the Ponyville area.”
Taking a moment, she paused to slide several pieces of paper across the table to Allen, who in turn picked them up and began reading through them as Penny continued speaking, “As you can see, that is our initial contract draft. In exchange for an initial investment of one hundred thousand bits, with the option of additional future cash infusions as needed, and access to His Grace’s many contacts within and without Equestria. You will be responsible for managing this farm and the surrounding lands that His Grace shall allow you to use rent-free. This initial investment will grant His Grace a forty percent stake in your farm. Which entitles him to twenty percent of the total net profits that you produce every quarter for the next five years. This of course is assuming that you are unable to return to your homeworld within that time frame. Should it be discovered that you are able to return before the five years are up, His Grace will simply ask that all bits that you currently possess at the time of departure are turned over to him as well as any materials that have been harvested from his lands. Any that you have harvested from your original acreage will go with you. At which point, you will be released from your contract. Finally, His Grace has made it very clear that you are to have as much freedom as possible when it comes to the day to day operations of your farm, as well as any future expansions. However, His Grace would prefer that if you decide to make any expansions, that you would notify him beforehoof as a courtesy, otherwise, you are free to use your own discretion. Do you have any questions?”
Allen finished reading the contract and set it down in front of him. Looking up at his two guests, he asked, “Yeah, I do. What do you mean that I will be ‘responsible for managing this farm and the surrounding lands that His Grace shall allow you to use rent-free’?”
“As I mentioned before, the lands surrounding Ponyville are part of the Grand Duchy of Canterlot. While Ponyville and the lands around it were originally given to the Apple family, they have for the most part ceded control to Prince Blueblood’s family over the years for economic concessions and money. The town itself and the Everfree are still under their control, they tend not to do much with it, instead electing to allow the local government to see to the day to day affairs of the town. While the Everfree they ignore entirely for some reason,” explained Penny, with a hint of exasperation to her tone, as if she were irritated that someone would deliberately ignore a potentially valuable source of revenue.
“I’ve spoken with Baroness Everfree on the matter before, and she’s of the opinion that nothing good comes from messing with the forest. Her son was the last pony in her family to try and develop it, and he went missing with his wife many years ago. It’s assumed they were killed by wild animals while surveying it for resources as the only things that were found were a blood-stained hat, and a turquoise mane tie with some bits of mane hairs in it,” cut in Blueblood somberly.
Allen saw Penny’s ears wilt and her exasperated look vanish like a puff of smoke in a strong breeze. “Oh,” was all she said in response as an awkward silence fell over the dining room table.
After a few moments, Blueblood decided to break the awkward silence with a polite cough, this, in turn, shook Penny out of her funk, and after shaking herself, she straightened up in her chair and continued, “Yes, well, as I was saying, the lands around Ponyville are for the most part under the control of His Grace. As such, he has decided to allow you to use them rent-free, his reasoning is that since nopony is currently using them, save for the occasional traveling hay cutter, their economic potential is being wasted. Therefore, in order to help kick start further development in the area, you will be the initial catalyst that will oversee their use.”
“Meaning, what exactly?” asked Allen.
Blueblood leaned forward and laying a hoof on the table replied, “That is up to you. If you want, you can let the land lie fallow, use it for hay and grazing or you may till it under and plant crops to sell. The choice is up to you. If you find that you can’t manage the land effectively by yourself, then you may acquire additional workers to help you. In essence, so long as we are partners, you will have unfettered access to my lands to do with as you please, within reason of course. Moreover, I do reserve the right to deny your use of the land for a certain activity if I deem it necessary. However, I do not think that I shall have to exercise that authority much if at all.”
“So, how much land are we talking about here?” asked Allen curiously.
Blueblood rubbed his chin in thought for a moment before replying, “I am not entirely sure as to the size of my Grand Duchy’s holdings, as I have only recently been given full control over them by my aunt, and have elected to allow others to manage them as I have other duties at present. However, if memory serves me correctly, it should be between three to four hundred square miles of land in total. Though that is total land area, the actual arable land will be smaller than that by a sizable margin.”
“That... is a lot of land,” said Allen, dumbstruck that Blueblood would be willing to let him use even some of the land for basically nothing, “and you’re sure that you don’t want to charge me rent or something?”
“Why would I?” asked Blueblood, “all that would do is limit the amount of land that you could ultimately develop for me. I would already receive twenty percent of the total net profits that you produce from your labor, once the contract is signed. Tacking on land rent on top of that would only slow down overall growth, and would thus eat into said profits, meaning I would make less money overall. No, in the long run, both you and I will make far more money if I simply wave the land rental fee and allow you unfettered access. This area has so much untapped potential, and I aim to use that untapped potential to restore my family’s fortune and honor.”
Glancing from Blueblood to Penny, who merely readjusted her glasses, Allen rubbed his chin thoughtfully as he considered his options.
I really can’t see where this could go wrong. There is nothing in the contract that says I have to meet any sort of minimum quota, nor any clauses that would force me to turn control of my farm over to anyone for any reason. All I would be losing out on is twenty percent of my net profits, which, in the long run, isn’t really that bad of a deal when you consider what Blueblood is bringing to the table here. After all, it’s not what you know, but who you know, that gets you results.
Taking a deep breath, Allen came to a decision, reaching across the table, he held out his hand and said, “Your Grace, you’ve got yourself a deal.”
A pleased smile spread across Blueblood’s muzzle as he took Allen’s hand in hoof and sealed the deal with a hoofshake. “I am pleased to hear that, Mr. Ross. I look forward to working with you going forward. As I mentioned earlier, Ms. Farthing will be your contact when it comes to business dealings, so if you have any questions, please direct them to her, and if she can’t answer them, then she’ll pass them along to me.”
“Sounds good,” replied Allen as he sat back down, having released Blueblood’s hoof from his grip.
“So, where do I sign?”