Evening star., 1938-06-08
DISTRICT BUDGET
UNHURT BY NEW
DEFICIENCY BILL
Donovan Dissipates Fears
That Its Eibera|ity Would
Produce Shortage.
MEASURE PROVIDES
1888, 900 FOR CITY
Squirt in Levy Returns and New
Tax Law May Result in
Reserve of $500,O00.
BY JAMES E. CHINN.

Fears that the second deficiency
appropriation bill, now under consider
alton by the House, might again throw
the District budget out of balance in
the coming fiscal year, were dissipated
today by Maj. Daniel j. Donovan,
auditor and budget officer.
Congress recently enacted tax Iegis-
lation to prevent the municipal treas
ury from going into the red in the
l2-month period beginning July l,
but the deficiency bill treats the Dis
trict so literally, another shortage ap-
peared imminent. Actually, the meas
ure provides nearly $835, 900 for the
District, or about $24O,000 in excess
OF the amount recommended by the
Budget Bureau.
Maj. Donovan, however, gives posi-
tive assurance there will be ample
funds in the Districts Golfers to meet
all the deficiency appropriations pro-
Vldlng, OF course, tax collections re-
main normal. In fact, he believes the
District may close the new fiscal year
with about S500,000 in reserve.
To Use Gasoline Tax.
Fortunately, nearly one half of the
S240.0OO increase approved by the
House Appropriations Committee will
come out of the special gasoline tax
fund instead of the general revenues.
About $l50,000 of this amount is to
be used for construction of two official
| stations for the annual inspection of
motor vehicles and for the salaries of
| personnel.
The District, according to earlier
estimates, was expected to end the
current fiscal year June 80 about
S4,7o0,000 in the red. Tax collections.
however, have been coming into the
District Building faster than antici-
pated, and indications now are the
deficit may not exceed $4,5OO 900.
The new tax legislation is designed
to raise at least $4,000 900 in the new
fiscal year, and the estimated s4,70O.-
900 shortage it would more than off,
set included about 100000 in def
ciencies. The total of the deficiencies
recommended by the House Appro-
priations Committee is S332,847.88.
Tax Law Seen Adequate.
Anyhow Maj. Donovan is certain
the new tax legislation will raise
enough revenue to finance the SAT-
0o0,0O0 appropriation act and leave
something for emergencies. As soon
as Congress adjourns he plans to
prepare a detailed financial state
ment showing the exact financial
condition of the District treasury at
the close of the present fiscal year,
as well as the prospective condition
June 80, 1899.
| Some of the major increases in
the deficiencies which will tap gen.
eral funds are due to the decision of
the House Appropriations Committee
to provide for continued operation of
the National Training School for
Girls after June 80 and the Children's
Receiving Home after December 81.
An Appropriation of $4,000 was rec
commended for the training school
and $4,000 to operate the receiving
home for the six-month period be-
tween January / and June 80.
New Taxes Seen Needed.
Although the District may wind UP
the new fiscal year with small re-
serve fund, new tax legislation is ex-
pected to be necessary in the 1910
fiscal year to raise sufficient revenue
for operation and maintenance of the
municipal government unless the pres
ent S5,000,000 Federal payment is sub
stantially increased. In anticipation
of such situation Congress has pro-
vided funds for study OF the financial
condition of the District by the Joint
Committee on Internal Revenue Tax
alton with view to recommending
a permanent tax program.
The business privilege tax on gross
receipts will expire at the close of
the new fiscal year, as well as the
$1.75 levy on real and personal prop
erty. The real estate tax then is
scheduled to revert to the former
$3.50 rate.