Evening star., 1932-05-18
To Prevent a D. C. Deficit.

Speaking for the District Commis
sioners as the Districts efficient
auditor and budget officer and as an
expert on the income and outgo of local
revenues, leaving for others the task of
presenting the equitable considerations
involved, Mr.. Donovan has clearly pre-
sented to the Senate Subcommittee on
District Appropriations the practical
necessity of retaining the Federal lump
sum at its present compromise figure of
Ss,5o0,0o
The House cut the District estimates
by nearly $4,000 900 in order to make a
paper justification of its arbitrary re-
duction of the lump sum to $500, 600.
Mr.. Donovan shows that even with such
drastic and unprecedented slashes, new
estimates of revenue availability and
revenue charges against the District
write deficit for the District in 1888.
If the Senate restored the lump sum
to its present figure of S9,500,000 and
passed the District bill as submitted by
the Budget Bureau-a District bill that
was even then pared down to the essen
tials of maintenance and public i'm
provement-the District would still be
facing deficit.
The equitable solution of this problem
of making both ends meet would lie in
an increase of the Federal lump sum to
some figure more nearly approaching
the lawful obligation on the part of the
Federal Government 70 meet its pro-
portionate share of Capital expenses.
Reduction of the lump sum, as proposed
by the House, should. in the light of
Mr.. Donovan's revelations, be consid-
cred by all reasonable men as out of
the question.
For many years now the increase OF
District tax revenues has been made the
excuse for diminishing the Federal con-
tribution. This contribution has been
reduced, in relation to the total,
as the Districts contribution has
increased. Now that local revenues
are declining, and declining to the ex-
tent that even conservative estimates of
revenue availability a few months ago
sound like somebody's fond dreams, it
is unthinkable that the Federal Gov
ernment will be committed by Congress
to the cheap and niggardly policy some
times described as working both ends
against the middle" AS Congress has
taken advantage of the increasing tax
revenues from the District to reduce the
Nations payment, it cannot now, with
any semblance of equity or fair deal
ing, consider making declining rev.
enues and economy an excuse for
further reductions.
"All these matters" Mr.. Donovan
said, in referring to his estimate of the
deficit now threatening the District,
''lead to the conclusive and convincing
justification not only for the continu-
ance without abatement in any part of
the Federal contribution of $9,500,000,
but also the provision of new and addi-
tional sources of revenues. This means,
in effect, that the additional revenues
proposed by certain of the Mapes bills
are really now needed by the District.
in addition to the full contribution of
$9500,000 by the United States, to per-
init the District properly to function
and to carry on a necessary program Of
public improvement.
More revenue, even with the SO 500,-
900 contribution by the United States,
seems to be needed. But the proper
source of such revenue lies in the full
fillment by the United States Govern
ment of its self-imposed financial obh-
cations to the District of Columbia.
The first question to be answered, in
seeking sources of new revenue, is the
extent of the Federal Governments
equitable obligation to the District and
whether that obligation is being met.
1t was failure by the United States
to fulfill its obligations, resulting in
practical bankruptcy to the District,
that led to adoption Of fair fiscal
policy in 1873. 1t is that same failure
now that is threatening local deficit
In 1892.
Even the most serious tragedy may