Evening star., 1925-01-11
DISTRICT SURPLUS
AND THE DEFINITE
PROPORTION PLAN
Proposal Now Made to Grant
Former and Abandon
Latter.
HISTORY OF THE FUND
NOW AWAITING USE
Declared by Joint Committee to
Belong to District-Bill Pend
ing to That Effect.


The bill recently introduced in the
! House by Representative Cramton
! proposes that the lump sum plan of
! Federal contribution to the District S
| upkeep and development, adopted for
| the fiscal year ending June 80, 1925,
| be made permanent and that in con-
sideration to the District for this de-
parture in substantive law from the
/ fixed proportion principle the accu-
mulated surplus of District tax reve-
nues now lying in the Treasury be
made available for District uses by
| appropriation. In short, 1t is proposed
that the District should be allowed to
use it's own money in exchange for
| the sacrifice of the definite proportion
plan adopted originally in 1873, on the
! $3.50 basis and continued on that
! basis until few years ago, when the
ratio was changed to 60-40, which is
| the definite proportion fixed by the
| permanent substantive law today.
The surplus of District tax revenues
! now lying in the Treasury unappro-
priated is the result of successive fall
| ures by Congress to appropriate all
! the money raised by taxation in the
| District together with the proper
! tionate amounts of Federal funds
under the $3.50 agreement. During
! several sessions of Congress efforts
| were made by the District to obtain
| the use of this money and finally by
! the act of Congress approved June 2S,
! 1922-the District appropriation act
! authorization was given for the ap-
| pointment of a joint select committee
consisting of three Senator'S and three
/ Representative charged with the
| duty of inquiring fully into the fiscal
/ relations between the District and the
| United States since July l, 1874, to
/ ascertain what surplus, if any, the
District had to its credit on the books
| of the Treasury. Under this authori-
zation Senators Phipps, Ball and
| Harris and Representative Hardy,
! Wright and Evans were named and
conducted the inquiry. They reported
! to their respective houses February 8,
| 1928. The report was signed by all
three of the Senators and two of the
three members of the House.
Joint Committees Finding.
The joint committee found and re-
ported that a net balance of $4,43S,-
1892 of surplus revenues of the Dis
| trict was at that time in the Treasury,
| to which the District was entitled,
and which should be appropriated by
Congress for the Districts use. This
! figure was reached by aScertaining q
all possible credits in favor of the
! District, and all credits in favor of
! the United States, and represented the
amount due without question as a net
| District credit.
A bill to carry into effect the find
| ings of this joint select committee
and to make this surplus available
| for appropriation for the District S
| benefit was framed and presented and
at the last session of Congress was
| passed by the Senate, was approved
| by the House District committee and
| is now pending on the House calendar
awaiting action there. That bill, re-
citing the amounts due as credits and
| recognized as offsets, states the net
| amount due the District as $4,43S,-
| 1892, but provides that the control
/ Ter general shall determine whether
further amount, SS19, 1888, which.
| it is claimed, was inadvertently
| omitted in the original calculation,
should be recognized as a District
credit and added to the s4,43S, 154.92.
Fifty-F1fty Should Apply.
1t has always been the contention of
| the District that the appropriation of
| it's surplus tax revenues, thus de-
clared by the joint committee to be-
| long to it unreservedly. should be ac-
of Federal money inasmuch as the
surplus represents District taxes
raised under the $3.50 law of District
maintenance. Had this money been
appropriated at the time it was col
lected in taxes, and under the law of
1873 1t could be collected only for that
purpose, 1t would have been expended
together with an equal sum of Federal
money. Every dollar of the surplus,
| Id
equitable capital. In other words, if
the Districts money, had been used
from time to time under the original
ratio of the organic act the District
would have had the benefit of $3.50
309.S4, without counting the item re-
served for the controllers further de-
cision, and s10,515, ,057.50 including
| that amount.
All of this money now impounded
! in the Treasury was collected in taxes
while the $3.50 ratio was in force.
| Subsequently the 60-40 ratio was
established While the District has
| never assented to the proposal that
| the surplus should be finally made
| available on the 60-40 basis (that
ratio being the substantive law when
| the surplus was declared by the joint
committee and the controller general
! to EXIST, it may be computed that II
| priation of the surplus the amount
| definitely reported by the joint COM
mittee to be due the District as it's
! own asset would in appropriation
terms be $685. ,924S7, and if the
potential additional credit left to the
| controller general for decision were
added the appropriation value at the
60-40 ratio would be $S,762.54292
! Possible Loss of Equity.
If the Districts surplus is simply
! declared available for appropriation
without any accompaniment of Fed
eral money, and the lump-sum prin-
| ciple is adopted as permanent basis
of District appropriations in the fu-
ture, the District loses its equity in
| the Federal share of the appropria-
/ tions that would have been made
| during the years that the surplus
was accommodating if the organic act
of 1878 had been fully carried into
| effect by Congress and every dollar
| of District taxes raised had been ex-
pended accompanied by an equivalent
dollar of Federal money
The accumulated surplus of Dis
trict revenues due to the lack of ap-
preparation has been specifically de-
cided by a joint committee of Con-
gress to be the property of the Dis
| trict, the lowest sum being S4,438,-
| 154.92 and the highest sum s5,257,-
52S.75. The District is now asked to
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