Evening star., 1938-01-31
HOUSE REFUSES
$7,0)0,0DO.LVMP
SUM FOR DISTRICT
Increase Of $4,000, 0,000.Was
Urged by PaImisano as
"0nIy Fair"
TAX LOSSES CITED
IN LAWMAKERS PLEA
Democrats Are Blamed for Steady
Drop in Federal Payments
to Capital.

BACKGROUND
Debate on 1889 District supply
bill last Ueek indicated chief prob
lens to be settled Uere amount OF
Federal contribution and the direct
reliet appropriation. As reported
to House, measure carried S5,OOO,-
900 as Federal payment for 1899
fiscal year.
An appeal by Chairman Palmi.
sano of the House District Commit
tee for a 100000 increase in the
Federal payment toward municipal ex-
penses was voted down by the House
today.
Mr.. Palnlisano. taking the floor as
debate was continued on the 1899
District appropriation bill, urged that
the Federal payment be increased from
s5,O00,000 to s7,000,000 a year, de-
claring this would be only fair"
in view of the vast amount OF prop
erty the United States has removed
from the city's tax rolls in recent
years.
Mr.. Palmisano also served notice
that when the bill is read later in the
day he will offer an amendment to
raise the Federal payment to $4,000, 900.
Blame for the ever-dwindling Fed.
eral payments to the District was
placed by Mr.. Palmisano on the Demo-
Gratis. He pointed out that when he
came to Congress more than 10 years
ago the Republicans controlled the
House. and the Federal lump sum
payment amounted to 100000 Un-
der Democratic control, however. he
said the amount has gradually been
reduced to the present $4,000, 900 level,
the lowest in history.
Wants 100000 Return.
Il am not asking for return of the
$4,00o,oo0 taken away by the Demo-
Gratis" he declared. But in all fair
ness think the Federal Government
ought to reimburse the District to
the extent of s2000,000 a year for the
land it has removed from the tax
rolls"
Mr.. Palmisano also declared a
100000 increase in the Federal pay
ment would permit the unpopular busi-
ness privilege tax on gross receipts to
die a natural death at the close of
the present fiscal year, instead Of be-
ing revived. as now contemplated, to
balance the 1889 budget.
Mr.. Palmisano pointed out that the
United States now owns about % per
cent OF the entire area of the District
and that only As per cent of the re-
naming area is taxable in view of
various exemptions
Representative Nichols, Democrat,
OF Oklahoma, chairman of the Fiscal
Affairs Subcommittee of the District
Committee, which is now writing a
new tax increase program for the COM
ing fiscal year, vigorously opposed any
increase in the Federal payment
6o-40 Disregard Upheld.
Declaring Congress had for many
years wisely" disregarded the 60-40
basis of fiscal relations. as provided
in unrepealed substantive law, Mr..
Nichols said There are only one or
two excuses for the Federal Govern.
ment contributing a cent"
Mr.. Nichols said an expert" whom
he did not name, had made a survey
for him to determine how much the
United States would be forced to con-
tribute, providing its payment was
based on the amount it would have
to pay in taxes if Federal property
could be taxed. The expert" he
said, reported the amount would be
slightly in excess Of $4,000,000.
Mr.. Nichols added, however, he did
not believe such a formula In arriv-
ing at the amount of the Federal
payment constituted "a good yard
stick" He declared the best plan was
the one proposed in the Inflated
Jacobs fiscal relations report, whereby
the amount would be based on the
fc>z nYYr No.