Evening star., 1930-12-17
DISTRICTS FISCAL
BURDEN CRITICIZED
Auditor Says Federal Aid
Lessened Despite Greatly
Increased Expenses.
Continued From First paEe.)


he said the Appropriations totaled $46,-
0OO,O 600, the District paying S36 600 900
ana the United States SIS, 500 600.
Thus 1t will be seen that between
ly2O and 1881" declared Maj. Donovan,
tine appropriations have increased
nearly $26.O00,000; that the Districts
proportion Of $9,90000O in 1920 has
mounted to $4,000 900 in 1881 and
tnat the United States proportion of
$S,IUo,V0O IN 1920 has dropped to So
5OO,OOO IN 1881. In other words, in the
race OF an increase of about 13o per
cent In appropriation during this
period the United states Is paying
less today by 100000 than 1t did in
1870. The major portion Of this great
increase In appropriations has been
met BY increased taxation Of real
property.
Says increases Not Parallel.
''In 1920 the assessed value Of taxable
real estate amounted (on the basis of
two-thirds value as then required by
law) to s426, ,623, $50, the tax rate was
sl.5o and the total levy or tax col
lectable was $6,399,354. In 1891 the
assessed value of real estate con the
basis of full value) Is $1,211 ,00o, 900, the
tax rate is $1.70 and the levy or tax
collectable is 0,500, ,O0O The assessed
value of taxable real estate has in
creased between this period of 1920 and
1891 by over 100 per cent and the levy
or the amount actually payable in taxes
BY 22O per cent"
Maj. Donovan next gave a historical
review Of the fiscal affairs of the Dis
trict during the period from 1870 to
1878, under which there was no definite
plan Of contribution by the Federal
Government toward the support of the
District, and followed this with an out
line Of the subsequent fiscal policies,
touching upon the $3.50 plan, the 60-40
basis and finally the existing lump-sum
arrangement.
He then touched upon the act Of
Congress requiring the District to oper-
ate on q pay-as-you-go basis, pointing
out that for this purpose It Is main
tanning a cash fund of $3,000,0O0.
It has not been necessary to increase
this 100000 cash fund up to the
present, he explained, notwithstanding
the fact that expenditures are now about
$45, ,00O, 900 q year, due to the fact that
Congress now allows the District to re-
ceive credit for the lump sum contribu-
ton on the FIRST day Of each fiscal year,
and to the further fact that legislation
passed in 1926 advanced the tax-paying
months from November and May to
September and March.
"I am inclined to the view however"
said the auditor, that with the mount
ing totals Of appropriations 1t may. be
only a question Of a short while before
the need for considerably Augmenting
the $4,000, 900 cash fund will be before
U.S."
Traces Surplus Revenue Origin.
The origin Of the surplus revenues to
the credit of the District in the United
States Treasury were next explained by
Mai. Donovan. At the close Of the Ave
year period, during which the District
was required to raise money enough to
enable It to pay Its expenses. or on
July /, 1927, he said, the District sur
plus revenues in the Treasury over and
above the $4,000, 900 cash fund amount
ed to $500 900; on July /, 1928, this
amount had increased to $3,125, 900; on
July l, 1929, 10 95, TOO, 900, and on July
/, 1890, the beginning Of the present
fiscal year, the surplus revenues
amounted to e6,500,000.
At the close Of the current fiscal year
on June 30, 1881, Maj. Donovan said. 1t
Is anticipated that the surplus will be
less than 100000. Based on the
amount Of the Districts budget for the
fiscal year 1889, he explained, it IL
believed that the surplus will be en-
tirely exhausted by June 30, 1892.
Although the bills as rendered by
the assessor to taxpayers for the fiscal
year 1880 carried the tax rate of S1.70,"
Mai. Donovan declared, "the fact Is
that had not the District the surplus
revenues to fall back upon to supply
the de1cit in current revenues, the
rate would have been In naexcess Of el.80
FoA That 1rAaf Ard IN 10ai the Ptirs
rent year, the rate, while actually 91.70
is really 50 II we eliminate from con-
sideration the use Of surplus revenues
to make good the deflcit in current
revenues.
Sees Surplus Exhausted In 1898.
"At this time it seems evident that
In the fiscal year 1888 the Districts
surplus In the Treasury will be prac-
tically exhausted and that the budget
for that year must be framed with only
current revenues in view. What the
total of the budget for that year will
amount to is entirely problematical at
this time"
After Mai. Donovan had completed his
explanation Of the surplus revenues
Chairman Mapes asked him why the
District shouldn't increase its tax rate
to avoid the exhaustion of this fund.
SURPLUS" Mai. Donovan replied. THE
budget proposed each year by the Com
missioners during the period in which
this surplus was created contemplated
the expenditure of estimated current
revenues, but cuts made in the budget
by the Budget Bureau and sustained By
Congress resulted in the accumulation
Of the surplus"
Believes People Want 70 Be Fair.
Questioned by Mr.. Mapas as to the
tax rate In the District, Maj. Donovan
said he believed the people in Wash
ington "are perfectly willing to pay g
fair, Just and comparable tax, prDvid-
ing the United States pays over and
above that amount to provide for the
development Of the Capital CITY,
IF a fair tax rate provided all the
funds necessary, do you think the Fed
eral Government should be relieved of
its contributions" asked Chairman
Il don't believe Congress should ever
be relieved of o fair and equitable part
of the burden of maintaining the Capt.
tel of the Nation" Donovan answered. |
harsh as to fail to contribute to the
support of the District"
Chairman Mapes then asked Maj.
Donovan II he though the Special Com !
mlttee should try to arrive at a fair
tex rate for the District, in comparison
with cities of comparable size without
any reference to the holdings of the
Federal Government.
The auditor declared in reply that
he thought reasonable amount OF the
property of the United States In the
District used in the transaction Of busi-
ness should be considered in arriving at
a fair basis of taxation.
How much is necessary for the
United States to contribute after the
people of the District have paid their
fair share in taxes?" inquired Mr.
Mapes.