Evening star. [volume] (Washington, D.C.) 1854-1972, 1904-03-21
DEPOSIT OF TAX FUND
COMMISSIONER WEST REPORTS
ADVERSELY ON BILL.
Objections to Placing the Collections
in National Banks of the
District.

Commissioner West today recommended
that the Commissioners report unfavorably
on the bill to provide for depOsting the
taxes collected in the District with the ma
tional banks Of the District which are
United States repositories. Mr.. West states
that from the reports made by the collector
of taxes and the auditor there are insu-t
perable objections at the present time to
using the United States repositories in the
District as custodians of District moneys.
He suggests, however, that the Commits
sloners express the hope that at some time
IN the future conditions will change so as
to allow the purpose of the pending bill to
be carried into effect.
In his report on the bill M E. G. Davis,
collector of taxes, states that an act pro-
viding for the depositing Of District funds
in national banks located in the District
would be great convenience to his office.
and would also prove beneficial to the busi-
ness community, in that such an arrange
ment would tend to relieve the stringency
or the money market at taX-collecting per-
lods. by returning the daily collections to
circulation, instead of locking the money
up in the treasury.
On the other hand" continues Mr. Davis
1T appears that money is being advanced
from time to time by the United States to
meet current demands of the District upon
which advances the District is required to
pay per cent interest on all balances In
other words, the money collected during the
greater portion of the year is due the
United States before it is collected This
being the case it would seem that the in
terest Of the District requires that all col
lect1ons be deposited at once in the treas
ury of the United States, to repay indebt-
edness and stop interest.
The Bookkeeping Problem.
Ihere arc also questions of bookkeeping
that would be affected by the proposed
change. Under present conditions and in
view or the financial relations existing be-
tween the District of Columbia and the
United States treasury 1 must with some
degree of reluctance, recommend an unfa-
vorable report on the bill"
Auditor Garrison to whom the bill was
also referred for report, concurs in the
recommendation of the collector of taxes
and calls attention to the fact that the
excess of advances made by the United
States to the District over and above the
revenues received and deposited In the
treasury to June 80. 1903, was 81, 653 SIT 81.
The excess to June 80, 1904, he says, will be
greater. and will be still further augmented
to June 80. 1905. In view of the fact that
the advances to the District exceed the
revenues deposited. Mr. Garrison says, 1t
seems necessary under the provisions of
the law authorizing such advances. that all
taxes collected shall be deposited directly
in the treasury of the United States
The auditor also states that should the
bill under considera ton become a law ii
would be difficult to determine what moneys
received by the collector of taxes should in
the first instance be deposited in the banks
specified in the bill and what moneys
should be deposited directly in the treas
ury. Some of the moneys collected by the
collector of taxes. it is pointed out, are by
law required to be deposited in the treas
ury to the credit of the United States and
the District of Columbia in equal parts;
other fees are deposited to the credit OF
certain funds and appropriations. Under
the present system it is stated there is no
difficulty in keeping correct accounts, but
it is believed that great confusion would
result under the system proposed In the
bill.
For Relief of Financial Conditions.
This bill, it is learned, is proposed with
the view to relieving the stringency of the
local financial market which occurs an
nually during the month of May. In that
month. it is pointed out, something like
s., 100000 is taken out of the city banks
by reason of the annual collection of taxes.
This large sum of money is deposited in
the treasury of the United States. and
consequently taken out of circulation.
causing considerable Inconvenience to the
local banks, which are obliged to increase
eon of to the
demands made upon them later.
Commissioner West in speaking of the
matter today stated to reporter for The
is strongly in favor of providing some
method by which the money taken out of
the banks during May by reason of the
collection of taxes could be placed back
in the banks and in circulation. He stated
that he believes the local banks desig-
mated In the bill are perfectly safe as
custodians of public funds and hoped that
some method could be provided to relieve
the local financial situation during the
spring of each year. In view of the recon-
mendations of the collector of taxes and
the District auditor, and the present ar
rangement of the District finances. how
ever Mr.. West stated that he could do
nothing other than recommend unfayor-
able action on the bill.
Mr.. Macfarland's View.
the recommendation in regard to the bill
stated this afternoon that he regrets very
much that conditions are such as to make
ii impracticable at this time to recommend
the passage of the proposed bill. He ex-
pressed the hope that the objects of the
bill may be accomplished at an early date
in the future. In case Congress adopts the
Commissioners suggestion relative to the
Arrangement of the Districts finances, he
is of the opinion that the matter can be
arranged satisfactorily.
1t is pointed out that If Legislation is
enacted permitting the District to repay
advances from the federal treasury In long
term payments that only that part of the
District revenues necessary to meet the
specified sinking fund payments, will have
to be deposited in the treasury at the close
of each fiscal year, and the remainder of
the Districts revenues can then be de-
posted in the local banks and kept in Or
culatiOn.