Evening star., 1931-12-15


actually used for Federal Government
purposes. 1t is claimed, should be en-
braced In the taxable real values and
this to the limit of structural costs, or
present-day reproduction structural costs,
| irrespective Of use, income, obsolescence
or market value. Evidently no consider
alton Is given to the monetary value to
the people Of the District of Columbia
because 1t is the Nations Capital, nor to
the benefits derived by the people in the
District by the flow Of visitors to the
city who spend large sums Of money
while here. Neither is there any con-
sideration given to the increment pri-
vate property values, created almost
solely because of the activities Of the
Federal Government in the District 1t
is perhaps needless to say that many
citizens of the District have grown
wealthy because of this increment value.
II is cnly necessary to refer to the large
increase in land values, as shown by the
assessment rolls, to indicate to con-
siderable extent the truth Of this
settlement.
The committee cannot agree with the
contention that the Federal real estate
or property should be usef in the COM
parison Of relative tax burdens. The
Buildings owned by the Federal Govern
IlCllJ WOulu DC VI dItltdliy dcciCSo w a'ty
one but the Government. They have
practically no market value.
Under such conditions 1t Is decidedly
unsound to use the cost or reproduction
value Of these buildings In any COM
rarison of relative assessed values or
tax burdens Furthermore, much OF the
land value upon which these Govern
ment buildings stand was created By
the Fe6eral Government, and due con-
sideration certainly should be given to
this fact by Congress.
The principal reason advanced for
including such property values in the
comparative is that it is the only large
industry in the District OF Columbia.
and that this in;ustry is fairly ccm-
parable with large industries in other
, cities. The CON mlttee cannot agree
with this contention. either. TIE Fed
eral Governments activities In the Dis
trict have the highest degree of stabil-
ity. There IS no diminishing OF its
activities Indeed, they are quite gen.
orally on the increase, with a corre-
/ spending increase in the Government
payroll. They are continuous, not in
terrupted by financial and industrial
depression.
'Here follows an excerpt from a radio
speech by Robert ]. Cottrel, executive
secretary of the Board Of Trade, Gis-
cusslng the relative absence of the de-
preston in WashingtonD
The COMMITTEES cannot see anv logic
in making comparison of Federal
Government properties with the prop
critics of industrial corporations located
elsewhere.
Federal Aid to States.
In discussions Of the fscal relations
between the United States and the Dis
! trict of Columbia a comparison has
| been made of the arount of Fe-eral
aid given to States with the Federal all
given tre District Of Columbia. This
comparison has little, If any. sgnif-
cance. fer the reason that very little Of
the Federal aid given the States reaches
the municipalities. It nearly all goes
to the rural communities. Further
more. most of this money given to the
Stetes constitutes a conditional grant.
In that the States are required to match
/ the amount Of the Federal grant
Federal Intangible Property.
A unique method has been employed
and recommended to this committee in
determining the amount of Intangible
Federal property holdings that should
be charged to the Federal Government
for the purpose OF comparing the rela-
tive tax burdens Of the District with the
tax burdens Of other cities. 1t is argued
that the value of intangible personal
property in the hands Of private owners
is about equal to the value OF their
tangible property. The tangible prop
erty owned by the United States and
located in the District OF Columbia, it
Is said has a value of $50 900 900, and
therefore that $50 1000 900 OF Intangible
property should be included in the COM
parative so as to place 1t on the same
basis as TIE tangible ani intangible
property holdings owned by the citizens
of the District. This. it seers to the
committee, Is purely an arbitrary set
up. There would be lust as much sense
in saying that 100000. 900 of Federal
Intangible property should be included
in the comparative as 100000, 900. BY
what reasoning $50 900 900 of intangible
property should be allocated to the Dis
trict Of Columbia the committee Goes
not know.
Assessment Of Intangible Property.
The use of the assessment of intangi-
! Bile property and taxes levied thereon
for comparative purposes is exceedingly
dlfficult and unreliable The systems OF
taxation employees and the rates of
taxes imposed upon this class OF prop
ertY vary so greatly in the various tax
ing units that no comparison can be
made that would be worth considera-
ton =
The committee doubts that the assess
ment OF personal property and the levy
thereon can be safely used In a com
parlson Of tax burdens. In many tax
Ing units some classes of tangible per-
sonal property are exempt from taxa
ton, such as manufacturing products.
Other forms of taxation, such as taxes
imposed on franchises and the impcsi-
ton of other excise taxes are substi-
tuted for personal property taxation
For these reasons the committee
thinks that the most reliable ccmpari.
son OF tax burdens is confined to the
assessment Of real property and the
taxes levied thereon.
Loss of Revenue to the District
One of the chief arguments made for
increased Federal contributions toward
the expenses of the District Government
is that the District has suffered loss of
taxes because Of the exemption Of Fed
eral properties from taxation. In esti-
mating the loss Of revenue it has been
the fashion to treat the Federal prop
critics as If they were always on the
assessment rolls of the District This.
the con- mittee thinks, is mistake. The
only possible loss of revenue would be
the revenue derived from the taxation
OF the land and improvements thereon
Immediately preceding the acquisition
OF the properties by the Federal Gov
ernment. In other Woris. the amount
of taxes paid by the private owners of
property at the time the Federal Gov
ernment acquired it. In this connection
1t is pertinent to say that the assessing
officer of the District, Mr.. Richards,
contends that there is no loss of reye-
nue. because of the acquisition of these
properties by the Federal Government.
The actual value of the property ac-
qulred by the Federal Government from
private owners in the last 10 years has
oeen appraised by Mr. Richards, the
Guy assessor at $36, 6,2o4, ,049, so that the
loss d revenue from this valuation