Evening star., 1937-01-13
"POint Three"

In its development of Point Three of
the three-point fiscal formula, the fiscal
report contains a premise that is rea-
sonable and conclusion that is in
credible until the facts in support are
examined. Such examination permits
understanding but not agreement.
The premise is that District residents
and taxpayers should not bear burden
Of governmental cost for like services
substantially in excess of that in similar
American communities" The conclusion
is that per capita costs for all normal
services are lower in the District than
the average in II comparable cities"
That conclusion is reached by includ-
ing, in the comparison, the factors of
debt-represented in interest payments
and outlays. Outlays, in all cities except
the District, are financed ito a greater
or lesser degree" by borrowing.
Such elements are not strictly COM
parable in a measurement of govern
mental costs, whether or not the COM
parison includes the District. Outlays
vary among cities from year to year and
is made for a single year the result is
apt to be misleading. If the comparisons
cover number of years and include the
District-as in the fiscal report-it is
misleading to treat outlays and interest
as part of such comparisons. The
District is not permitted to assume
bonded Indebtedness without specific
authority from Congress. That authority
has been withheld under the policy of
Congress to keep the District on a pay
as-you-go basis. Debt service and out
lays add enormously to the cost of gov
ernment in other cities. They may
represent the penalty of extravaganza,
or they may have secured for the tax
payers benefits in the form of outlays
lacking here. Not permitted to borrow
for outlays, Washington should not be
placed on comparative basis with cities
that do borrow, heavily, for financing
improvements.
cost and operation of general depart
mentS. The result of such comparison
bears out the contention of Washingto-
mans of the generally higher costs of gov
ernment in the Capital For the cost of
government here is shown by the report
to have exceeded the average of the
seventeen cities with which it is COM
pared in nine of the thirteen years
covered by the comparison, and was
exceeded in only four-1923, 1924, 1884
and 1885. For the year 1885, Washing
tons governmental cost was exceeded
by the average of the seventeen cities,
but taking the cities individually Wash
ington exceeded eight of them and
closely approximated two of them. In
functional classifications for the year
1882 (the last year for which figures in
the report were completely available)
Washingtons cost per capita for gen
eral government" health and sani-
tation," charities, hospitals and correc-
tions" and education" was under the
average, and for protection to life and
property" highways" recreation" dn-
cluding PARKS and miscellaneous" was
higher than the average These excesses
are those which show particularly the
influence of National Capital standards
and demands on governmental costs.
Averages, of course, are sometimes mis-
TraI 1f Ia;
high in their expenditures and not par
ticularly noted either for their efficiency
or progressiveness is rather meaningless
when the purpose of the comparison is
to seek reasonable level of costs among
progressive, well-governed cities.
In Point Three of the formula the
proposed use of such an average is pc
culiarly designed to prevent any pay
ment by the United States toward main
tenance costs of the Capital, and is
destined likewise to discourage outlays
Tor development. The theory of Point
Three is that when the cost of govern
ment in Washington exceeds this average
OF seventeen cities, swelled by the in
clusion of those cities notoriously high
in governmental costs and their heavy
outlays with borrowed money, the Ma
tional Government will pay the excess
for the District.
Under Budget Bureau control WASH
tneton's expenditures have been kept in
recent years, below reasonable levels in
keeping with systematic policy of lump
sum reduction. In future years, under
this formula, such expenditures would
tend to be kept down to prevent addi-
tional payment by the United States.
The reports statement of it's conclu-
sion that costs in Washington are below
other cities is apt to be misleading and
practical application of the averages it
uses will effectively serve to prevent any
"excess" costs upon which Federal pay
nlent is made contingent.