Evening star., 1935-04-13
Inquiry Proposed to Fix
Amount of U. S. Share of
D. c. Expenses.
TAX COMPARISONS
ARE PARTIALLY MADE
Finding of Low Adjusted" Rate
Here Faces Criticism for
Methods Used.


in and out of the Government to settle
the question of how the expenses Of
the National Capital should be ap-
portioned between the United States
and the local community was recon-
mended today by the Treasury Depart
ment in its long report to
President Roosevelt on local taxation.
In making the report public, 1t was
stated at the Treasury Department
that the President today is forwarding
copies to Senator King and Represent
ative Norton. chairmen. respectively,
of the Senate and House District Com
mittees.
The Treasury report is almost en-
tirely an analysis of comparative tables
of tax burdens and costs of government
in Washington and IA other cities.
The Treasury reported that "if con-
sideration of the quality and quantity
of services received by residents of the
District be excluded and attention be
focused solely on the actual money
burden of taxation, the clear an
swer is:
The evidence indicates that Wash
ington taxpayers bear a smaller total
burden of taxation than the residents
of other cities of roughly comparable
size and character"
Vigorous Protest Seen.
This conclusion. however. will prob
ably be met by vigorous criticism from
local citizens who have made frequent
studies Of comparative tax burdens.
The first point of attack. it was sug-
gested, will be on the method used by
the Treasury in making a comparison
Of so-called adjusted tax rates.
The Treasury took its tax rate fig
ures from the Detroit Bureau of Gov
ernment Research, which follows the
method Of adjusting" tax rates by
obtaining the estimates OF local off,
cials regarding the ratio of assessed
to actual values of property.
BY this method Washington, with
an assessment ratio Of 100 per cent
OF assessed to real value. is compared
with cities where the reported assess
ment ranges upward from 40 per cent.
MetnO0 is Cf1tic1Zed.
The Detroit Bureau method is to
apply the reported. or guessed dt, ratio
of assessment to the actual tax rate.
And through use of this method, which
has been widely criticized, Washing
ton Is shown with lower adjusted
tax rate than any other of the IA
cities with which it is compared
When the Treasury deducts from the
tax rate that portion which goes into
debt service, Washington having nc
bonded Indebtedness, the result shows
that Washington's adjusted" tax rate
is lower than that of any city OIL the
list except Cincinnati.
The Treasury inquiry reveals Wash
ington's per capita assessment a.
by far the highest of any Of the cities
compared. In governmental cost pay
ments per capita Washington is shown
as being the eighth city on the list
when the lump sum is included and
thirteenth on the list of Is cities when
the lump sum is excluded.
Comparisons Crude Measure.
Throughout the report, however, the
statement is reiterated that compare
tive general property tax rates offer
but a crude and preliminary measure
of the comparative burden of taxa
ton" It also states that "a similar
statement must be made about pei
capita costs of Government"
In this connection the report also
states:
THE fact is that |cities vary widely
both in the quantity and the quality
of the services rendered their resi-.
dents. Hence. q direct comparison
of aggregate and per capita financial
outlays only, properly requires supple
mentation by an intensive analysis
of the character Of the services rem
dered."
Recommendations Listed.
After devoting % typewriter pages
to analyzing the several tables on taxes
and costs of government, the Treasury
report concluded with these recon-
mendations:
I'm order % to supplement the fore
going analysis of the comparative tax
rates and costs of government by ref
erence to the quantity and quality Of
services rendered, and CD to provide
the data needed for the choice of con-
tinuing criteria for the determination
Of the proportions and amounts o1
revenues that may be justly raised
through District taxation and Federal
contributions, respectively, it is rec
commended that q more extensive in
vestigation, conducted with the assist
ance Of experts within and outside OF
the Federal Government, be author
led
Inasmuch as the fiscal relations is
sue is one involving the interests OF
both local residents and the Federal
Government the final suggestion in
the Treasury report that further in
quiry be made by experts within and
outside of the Federal Government, y
Is important.