Nor can the city tax its hometown industry, the U.S. government. Federal properties are tax-exempt. The Brookings study recommended that the federal government give the city an annual payment in lieu of taxes. Fiscal analysts caution that the nation's buoyant economy has fattened the city's coffers and disguised these underlying problems. But as candidates promise tax breaks and talk of spending more on schools, welfare reform and capital repairs, some discern a disconnect between election year rhetoric and fiscal reality.
Revenue reform is the last step in a restructuring of the city.
But that hasn't happened yet. Mayoral politics makes for interesting math when the talk turns to taxes. What follows is a brief view of the four leading Democrats' stances, culled from interviews and a D.C. Chamber of Commerce questionnaire. Chavous, a lawyer, opposes a gross receipts tax. On the federal level, he supports a 15 percent flat federal tax on income in the District.