Evening star., 1934-12-28
Fiscal Equity for Washington.

Fiscal Equity for Washington.
Elsewhere in todays Star there ap
pears the first of a series of articles,
printed as editorial correspondence,
on the subject: Fiscal Equity for
Washington.
In this first and in subsequent ar
ticles there will be discussed briefly
the respective obligations by Nation
and local community in the mainte-
nance and upbuilding of the National
Capital. The President is proceeding
with an inquiry into local taxes, pre-
sumably as the foundation for further
study of the involved situation re-
garding fiscal relations. For as these
articles will point out, the obliga-
ton Of local taxpayers is merely one
of the considerations which must be
taken into account in any effort to
find an equitable solution of the
problem represented in the unique fis-
cal relationship between Capital and
local community.
What are the Nations obligations
TO its Capital? The first article today
summarizes the most important of
them as follows:
!. Obligation based on extensive real
estate ownership of United States
in District.
(a) Estimates of amount of
hypothetical tax Nation
would pay on national
property if assessed and
taxed as an individual or
corporate taxpayer. Equi-
table payment in lieu of
taxes suggested, not actual
taxation of national prop
erty.
tb) Estimates of amount of OBJ
legation equitably payable
in consideration of vast
area and great value of
national property stricken
from tax roll and held ex-
empt from taxation.
3. Obligation based upon absolute
control of city. Obligation fol-
lows power, including obligation
springing from conditions sur
rounding founding of city.
.. Obligation springing from demands
of patriotic pride in Capital.
When Nation shirked its obliga-
tion, Capital was national sha me.
When Nation met its obligation,
Capital became Objec of national
pride.
1. Obligations based upon payments
made from local taxes, solely
because Washington is the Capt.
tai, in excess of what would be
paid if Washington were the
ordinary commercial self-sustain-
ing community. Also items which
are national or semi-nat ationaI
and impose an obligation upon
the Nation to pay all or half or
40 per cent of expenditures, and
thus render inadequate the ma
tional payment Of approximately
IL per cent under current lump
sum appropriations.
!. Obligation based upon heavy ma
tiOnal internal revenue) taxes
paid by people Of Capital, COM
pared with corresponding pay
ments by the States.
.. Equitable oblig alton to pay heavily
for Capital upbuilding in lieu of
hundreds of millions of grants,
bOuntieS, subsidies paid by Ma
tion to States from national taxes
to which District contributes
more than half of the States, in
a distribution from which the
Capital has been barred.
AS pointed out in todays article,
which discusses the first of these OBJ
legations, there must be considered in
addition to the important element of
tax-free real estate, owned by the
National Government and represent
ing slightly less than 40 per cent of
the total taxable and exempt real
property Of the city, the nature of the
city itself. 1t was planned and has
been developed by the National Goy-
ernment, not as a self-sustaining
municipality, but as the Capital of
the United States. Its taxable area,
subject to constantly increasing
diminution by acquisition of property
for the Federal Government own
use, has since the beginning been
sharply defined by the Constitution
Itself. The District cannot enlarge
its taxable area beyond its boundaries.
A steadily decreasing fraction of the
city's area must bear the burden of
steadily increasing tax levy to meet
the needs of a growing city.
Washington is unlike any other
American city and there is no rule
of thumb, gained by study of other
municipalities, which cam be applied
in the solution of it's own, peculiar
problems. This will be shown in
subsequent articles of this series, dis
cussing other points which appear in
outline above.
-----S-A~SS