Evening star., 1933-02-14
Lump Sum and Tax Reduction.

AA ACPoitha6 ehC oAoGiCt OA NOluiIiUid
appropriation bill for the current fiscal
year last Spring the Senate Appropria-
tions Committee recommended a COM
promise lump sum Of $3.50, 900, ex-
planning that "the amount as recon-
mended does not reflect an equit-
able settlement Of the question of fiscal
relations between the United States
and the District of Columbia in normal
times, but is in accord with the gen.
eral practice Of reducing Federal ex-
penditures by ten per cent"
Caught in the usual log jam Of the
closing session, with the coming politi-
cal campaign and the conventions tax
ing precedence. over other things, the
deadlock between House and Senate
over the lump sum was broken by
another compromise which set the lump
sum at Sits 900 for the current fiscal
year. The House had suggested
lump sum Of $6,500.00o.
This year the House bill again pro-
poses reduction Of the lump sum to
six and a half million. That figure, Of
course, comes nowhere near represent
ing the equitable Federal contribution,
and, while these are far from being
normal times, the proposed reduction
OF 1874 per cent from the year before
and 3l.5 per cent from the preceding
year, is greatly in excess Of the re-
duction of other Federal appropria-
tions. The Bratton amendment, now
In conference between House and Sen
ate, proposes only q hve per cent re-
duction in Federal appropriations. and
1t has been clearly demonstrated that
this five per cent cut Is dangerously
excessive.
The House proposal for q sixteen and
quarter per cent reduction In the
Federal allotment for the District, how
ever, is accompanied by other reduc-
tions in the proposed expenditures Of
local revenues (some Of them repre-
senting cuts under the Federal econ
omy program) that will pile up in the
Federal Treasury q surplus Of more
than four million District dollars At the
end Of the next fiscal year. The price
to be paid for these reductions will be-
come more apparent In the next few
years. The attempt to whittle away
the Federal contribution, and to ad-
vance . specious argument for such
whiting by painting false picture Of
excessive local revenue, is merely post
poning q day Of reckoning when great
ly enlarged appropriations will be
necessary to make up for temporarily
retarded development Of the American
Capital
But If Congress continues trimming
the Federal appropriation and relies
on the sophisticism of refusing to spend
local tax revenues in order to show that
more money is collected than need be
spent, the local taxpayers should be
given the full privilege Of participating
in the game. The only benefits. to
them, lie in a reduction Of local taxa
ton. The tax rate for the next fiscal
year will be set by the Commissioners
some time in the late Spring. The tax
rate Is designed to raise the revenue
that Congress says shall be spent. If
Congress says that the full amount Of
money produced at the current rate of
taxation shall not be spent, the tax rate
should be lowered to bring in merely
what Is needed. For that reason the
House and Senate should eliminate
from the District bill the unnecessary
and unfair stipulation providing that
"the tax rate in effect In the fiscal
year 1898 on real estate and tangible
personal property subject to taxation in
the District shall not be decreased for
the fiscal year 1884"
II, after Senate and House have
agreed on local appropriations for the
next fiscal year, the current tax rate
will produce more money than Con-
gress permits to be spent, the Commis-
sioners should have the right to lower
the tax rate. 1t is unnecessary to for
bid them to lower it. They cannot
incur q deficit, and they will not lower
it If Congress appropriates to the level
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