Evening star., 1940-08-07
D. c. Budget
Continued From First Page.)

tSoAAUlAAQCA AolIA IL dSCy
item. The estimates were then put
| together and forwarded to the Bud
| get Bureau.
Then the same procedure was re-
peated with the department heads
| justifying every item, down to ST.
200 before John Keddy, an official
of the Budget Bureau. The budget
was then transmitted to Congress
with the Federal budget and the
department heads and civic groups
appeared again to justify only those
items approved by the Budget Bu-
reau. District officials were not per-
mitted to request those items not
approved by the bureau.
This procedure permitted good
deal OF buck passing" between the
bureau and the Commissioners, since
the Commissioners could charge the
bureau with the elimination of
many desired budget items. The
new procedure will place full re-
sponsibility for the general orerat-
ing estimates upon the city heads.
1t is understood that the prin-
cipal reason for retaining pudgetary
control over the ALLEGATION of cap
ital outlay funds would be to pre-
vent the District from running into
debt. Federal interests in the oper-
alton of such joint Federal district
projects as ST. Elizabeth's Hospital
and other institutions will continue
to be closely scanned by the bureau.
Bills Routed as Routine.
In the field of legislation. bills
of purely municipal character will
be routed through the bureau merely
as a matter of routine and will be
the subject of intensive study only
as they affect the Federal Govern
| ment.
While the close interlocking of
Federal and District interests might
make the extent of the Budget
Bureaus withdrawal speculative.
Director Smith made it clear that
the policy was to be carried out
in the interests of sound local gov
ernment where responsibility is
| fixed
Previous budget directors have
held to the letter of the law which
places the District under the Bureau
of the Budget with the creation of
the Bureau in June, 1921. At that
time the Federal Government was
participating in District expend-
| itures at the rate of 40 per cent
under the old 60-40 agreement. thus
providing large Federal interest
to be supervised. With the adop-
ton of the lump sum a few years
later. Federal contribution dwindled
to 10 or IL per cent in the last two
years.
National Budget Controlled d. C.
During all this period Of the past
19 years the District budget has thus
been considered a part of the ma
tional budget and it has been SUBJ
ject to the policies adopted con-
corning the national budget. Fol-
example, when in 1888 Is per
cent reduction was made throughout
the Federal or national budget, the
same reduction was made in the
District estimates, although the Dis
| trict had sufficient funds available
for higher estimates. AS matter
| of fact. about the only real applica-
ton of the Is per cent reduction
policy was in connection with the
District budget-Which resulted in a
sharp cut in the lump sum.
For the first 10 years, despite the
| pleas of District officials, notably
Auditor Daniel J. Donovan, the Dis
trict revenues were listed as income
to the Federal Government and the
Districts expenses we're listed among
the liabilities, despite the fact that
| the bulk of the revenue was from
District citizens for District pur-
poses only and not the Federal con-
tribution that it appeared. This
method of bookkeeping once con.
fused Gov. Albert E. Smith of New
York, in a radio address during his
candidacy for President, into point
ing to extraordinary sums being
spent on the District.
For the last decade, however, tn,
District revenues have been carried
as trust fund in the national rev.
enue statement-a small separation
concession.
Thus the Federal yardstick wa!
used in measuring the District esti
mates despite the overwhelming per
centage of locally derived tax rev.
enue that was to be spent.
Though members of Congress ane
even budgetary publications had in
terested themselves in the unusua
status of the District as almost 1
Federal department in. its relation
with the Budget Bureau, no on
has questioned the specific author
ity of the bureau over the Dis
trict. The principal effort Of thos,
interested has been to try to ge
consideration for the District bulge
entirely separate and Independent o1
the national budget, so that tn.
District problem of expenses woule
be considered in accordance with
the Districts ability to pay and MOI
be bound by national regulations.
1t is expected that the new policy
will correct this situation.
During the period of the early 80!
heavy slashes made by the bureau
in the District estimates created s
surplus in the credit of the District
treasury. The new policy will in al
probability prevent a recurrence ol
this situation.
1t was indicated that because o1
the increase in the responsibilities
of the Commissioners, civic group!
should make their recommendation,
to the city heads rather than to thu