I 
109TH CONGRESS 
1ST SESSION H. R. 1586 
To establish an annual Federal infrastructure support contribution for the 
District of Columbia, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 12, 2005 
Ms. NORTON (for herself, Mr. TOM DAVIS of Virginia, Mr. WOLF, Mr. HOYER, 
Mr. MORAN of Virginia, Mr. WYNN, Mr. CUMMINGS, and Mr. VAN 
HOLLEN) introduced the following bill; which was referred to the Com-
mittee on Government Reform 
A BILL 
To establish an annual Federal infrastructure support con-
tribution for the District of Columbia, and for other 
purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘District of Columbia 
Fair Federal Compensation Act of 2005’’. 
SEC. 2. FINDINGS; PURPOSE. 
(a) FINDINGS.—Congress finds as follows: 
(1) A General Accounting Office (GAO) report 
of May 2003 found that the District of Columbia
has a substantial structural imbalance, ranging from 
$470,000,000 to $1,100,000,000 annually, and that 
this imbalance is beyond the direct control of local 
officials because it is caused by mandates, legisla-
tion, and other requirements imposed by the Federal 
Government. 
(2) The GAO report was preceded by 2 reports 
by distinguished groups who also concluded that the 
District had a structural imbalance: A 2002 
McKenzie study commissioned by the Federal City 
Council (an organization of regional and local busi-
ness leaders), and a 2002 study by the Brookings 
Institute, led by Alice Rivlin, the former director of 
the Congressional Budget Office and former chair of 
the District of Columbia Financial Responsibility 
and Management Assistance Authority. 
(3) The components of the structural deficit are 
all Federal in origin and consist of the following: Lo-
cally provided services to the Federal Government; a 
Federal statute which exempts from taxation 66 per-
cent of the income earned in the District; the exemp-
tion from taxation of 42 percent of the real property 
owned by the Federal Government; and the require-
ment to provide State services, such as special edu-
cation and mental health, although the District is 
not a State. 
(4) The District’s tax burden is among the 
highest in the Nation because of the Federal re-
quirements documented in the 2003 GAO report. 
However, the funding provided by these taxes is still 
insufficient to meet the obligations of the District, 
especially the long-term obligations to carry out crit-
ical capital projects to maintain and improve the 
District’s infrastructure, projects that are not only 
typically funded by a State but that the District 
must carry out because of its mandate to support 
the infrastructure needs of the Federal Government 
and the entire Washington region. As a result, the 
District must obtain the funds needed to meet these 
obligations through a continuous series of bor-
rowings, incurring more and more debt service pay-
ments each year, and causing the District’s per cap-
ita rate of general obligation debt to be the highest 
in the Nation. 
(5) The GAO concluded that greater manage-
ment efficiency by the District government is nec-
essary, but that ‘‘management improvement will not 
offset the underlying structural imbalance because it
is caused by factors beyond the direct control of Dis-
trict officials’’. 
(6) The GAO recommended against the only 2 
alternatives available to the District. Raising taxes 
would ‘‘worsen D.C.’s competitive advantage in at-
tracting new businesses and residents’’ and cutting 
services for residents and visitors would have ‘‘unde-
sirable consequences for the District’s economy’’. 
(7) According to the GAO, the options are to 
‘‘change Federal procedures to expand the District’s 
tax base or provide additional financial support and 
a greater role by the Federal Government to help 
the District maintain fiscal balance’’. 
(8) The District of Columbia, through prudent 
budgeting and improved management, has had a 
balanced budget with surpluses for 7 years; however, 
the District’s Chief Financial Officer (whose position 
was created by a Federal statute) has found that se-
vere fiscal problems are inevitable as the District 
works to close spending pressures and find remedies 
to its inherent structural imbalance. 
(9) Maintaining financial stability in the Dis-
trict, just as in other cities, requires a stable, pre-
dictable source of revenue that increases modestly 
but regularly over time.
(b) PURPOSE.—It is the purpose of this Act to pro-
vide an efficient mechanism and formula for the transfer 
of revenue from the Federal Government to the District 
government, and to dedicate this revenue for the sole pur-
pose of rectifying an annual structural imbalance which 
is due to— 
(1) Federal requirements and limitations on the 
ability of the District of Columbia to generate rev-
enue; 
(2) the use of District of Columbia real prop-
erty by the Federal Government for Federal facili-
ties and other Federal purposes; and 
(3) the District’s status as a Federal city which 
is not part of a State but incurs many of the same 
expenses as a State that would otherwise be respon-
sible for these expenses. 
TITLE I—DIRECT FEDERAL CON-
TRIBUTION 
FOR 
INFRA-
STRUCTURE COSTS 
SEC. 101. ESTABLISHMENT OF DIRECT FEDERAL CON-
TRIBUTION TO DISTRICT OF COLUMBIA. 
(a) ENTITLEMENT
OF DISTRICT
TO CONTRIBU-
TION.—For each fiscal year beginning with fiscal year 
2006, the District of Columbia shall be entitled to receive 
an annual infrastructure support contribution to support
the infrastructure used by the District of Columbia and 
in part by the region in accordance with this title. 
(b) OBLIGATION OF UNITED STATES.—Subsection 
(a) constitutes budget authority in advance of appropria-
tions acts and represents the obligation of the Federal 
Government to make annual infrastructure support con-
tributions in accordance with this title. 
SEC. 102. DETERMINATION OF AMOUNT OF CONTRIBUTION. 
(a) IN GENERAL.—The amount of the annual infra-
structure support contribution required by this title is 
equal to— 
(1) 
in 
the 
case 
of 
fiscal 
year 
2006, 
$800,000,000; and 
(2) in the case of each succeeding fiscal year, 
the amount required for the previous fiscal year, in-
creased by the applicable index described in sub-
section (b). 
(b) APPLICABLE INDEX.—In subsection (a), the ‘‘ap-
plicable index’’ with respect to a fiscal year is the greater 
of— 
(1) the percentage by which the Consumer 
Price Index (all Urban Consumers, United States 
City Average) for the 12-month period ending on 
June 30 preceding the beginning of the fiscal year
exceeds such Consumer Price Index for the pre-
ceding 12-month period; or 
(2) 4 percent. 
TITLE II—DEDICATED 
INFRASTRUCTURE ACCOUNT 
SEC. 201. ESTABLISHMENT OF ACCOUNT. 
There is established in the general fund of the Dis-
trict of Columbia an account to be known as the Dedicated 
Infrastructure Account (hereafter in this title referred to 
as the ‘‘Account’’), which shall consist of the following 
amounts: 
(1) Amounts deposited pursuant to section 202. 
(2) Such other amounts as may be deposited 
pursuant to District of Columbia law. 
(3) Interest earned on amounts in the account. 
SEC. 202. DEPOSIT OF ANNUAL INFRASTRUCTURE SUP-
PORT CONTRIBUTION. 
Each annual infrastructure support contribution 
made to the District of Columbia under title I for a fiscal 
year shall be deposited into the Account. 
SEC. 203. USE OF AMOUNTS IN ACCOUNT. 
(a) IN GENERAL.—Amounts in the Account may be 
used only for the following purposes: 
(1) Transportation activities, including the pay-
ment of the local share of participation in public
transportation activities and road construction and 
improvement projects. 
(2) Information technology improvements for 
the District government. 
(3) Debt service payments on bonds, notes, and 
other obligations of the District government. 
(4) Building and facility maintenance, construc-
tion, and capital improvement projects for District 
of Columbia public schools and public charter 
schools. 
(b) AVAILABILITY OF FUNDS.—Funds appropriated 
or otherwise made available from the Account shall remain 
available until expended. 
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