Evening star., 1933-06-04
Reducing Local Assessments.

payers is concerned it does not make
any great difference whether tax reduc-
ton is achieved by reducing the tax
rate or by reducing the assessments.
Some cities have done one thing and
some have done the other, and 1t Is
probable that most cities have done
both. There is, however, such an OBJ
vious anomaly in holding the assess
ments of 1898 at the level Of the assess
merts of 1929 that assessments every
where are being reduced. In some
cases the reductions have been hori-
Bontal, thus bringing about previously
determined percentage reduction to all
property holders in some relation to the
amount of loss suffered by declining
values. In others the normal reassess-
ments of property for taxation have
shown reductions rejecting the defia-
ton in property values. These reduc-
tions in assessments, of course, are
made without changing the law-sel-
dom followed with the same degree of
thoroughness in any two cities or even
assessment districts-requiring assess
ment at full value. There are widely
varying standards of assessing at full
value
The citizens who presented to the
Commissioners on Friday resolution
recently adopted by the Federation OF
Citizens Associations asking for hori
Dontal decrease of perhaps twenty per
cent in assessments were thoroughly
justified in their request. Assessments
here remain what they were, generally
speaking, during the years of the boom,
although many holders of second
trusts have seen their equities wiped
out by declining values. These values
of the boom years may have been in
fiated, 1t is true. So were the values
of intangibles. But while assessments
Of intangibles have fallen, the decrease
corresponding to the decreased value as
listed on the exchanges, real estate,
especially residential real estate, re-
mains assessed today at practically the
same level as in the boom years. 1t is
difficult to defend this condition by at
tempting to argue that Assessments for
taxation are the true indicators of value,
while sales values are mere indicators
of the degree of builders profits or of
speculation in real estate. This Is like
saying that every city is out of step
except Washington; that all value is
fictitious being too high or too low,
except the assessed value.
And there is a real reason why the
protesting citizens prefer a reduction
in assessments to a reduction in the tax
rate, and, If given the privilege OF de-
Gliding for themselves as the citizens OF
other communities decide, would prob
ably prefer to bring about tax reduc-
ton by lowering the standard OF as
sessment rather than the tax rate
Washington's tax rate is low, but its
standard of assessment is as high as the
highest in the United States, demon
strable fact and a recognized fact. The
low tax rate, however, has for years
immemorial been the target of attack
by some Of our legislators, members OF
Congress, who, comparing it with the
tax rates in their home districts and
eliminating the equally important factor
of standard of assessment in practice,
have accused Washingtonians OF tax
dodging.
Last April Chairman Buchanan OF
the House Appropriations Committee
emphasized the real situation here when
he explained:
As my colleague has said, the tax
rate is Sl.70 on the full valuation OF
real estate. In my home State and in
yours when property is assessed Tor
taxation purposes it is assessed at about
fifty per cent of its fair value and taxes
are paid on that amount. Here the
property is assessed at full value and
the tax rate of Sl70 is paid on full
value. This is an eXorbitant and un-
reasonable tax on real estate IN thls
District There are thousands OF poor
people attempting to buy homes in the
District, and for them to be required to
pay So 40 per 500 in taxes on Valua-
ton of these homes the way property
would be assessed in other States OF
the Union is too much.
The most direct method, and the only
enc Immediately available, Of bringing
About a much-needed reduction in the
real estate tax burden is by decreasing
the tax rate, which will be done. But
in this time Of shrinking property val
ues. there should be a decrease In
assessment in accordance with that
shrinkage and, in the final equitable
readjustment, there should be a de-
crease in practice of the percentage re-
lation of assessed to true value In
some places this relation is as low as
twenty and twenty-five per cent, but
In Washington it has been said to ap-
proximate, as whole, full value by less
than ten per cent. This attempt rig
idly to maintain assessments at full
market value not only reacts to the
disadvantage Of Washington in defend
ing the adequacy OF its tax rate in COM
parison with those of other cities, but
leads into the bewildering field OF
attempt to establish the elusive ele-
ment of real value by assessments for
taxation purposes.