Evening star. [volume] (Washington, D.C.) 1854-1972, 1947-06-04


eral payment unless it is regulated
by. the adoption of formula.
The issues raised by Mr.. Koran
indicated there would be fight on
the House floor over the revenue
program.
The Koran subcommittee is hold
ing executive hearings on the record
breaking budget. Commenting on
the outline given late yesterday by
the Bates subcommittee, Mr.. Koran
said, II do not know where $780,
900 can be cut out of the budget
requests. Some savings, of course.
can be found. But at present, I
think it is fair to assume the total
District budget is facing an increase
of about 100000 instead OF any
large decrease"
Unlike Original Bill.
The final result of the joint COM
mittee study bears little resemblance
to the eight-bill, s20,000,000 recon-
mendations submitted by the city
heads earlier in the year. Con-
spicuously absent was the sales tax
core of District Building schedule
of levies and sought by Mr.. Koran
as a means of financing new school
construction.
If the taxes are enacted, the Fed
eral payment raised and the budget
cut made, Mr.. Bates indicated, the
District will wind up the next fiscal
year with a surplus of $2,105, 307 and
the year after that, with $418,213.
Senator Cain said a 100000
Federal payment boost would be
split, 100000 going to the general
fund and 100000 to the water
fund. The payment to the water
fund, he said, could be justified
as payment by the Government for
the water it now receives free
from the city.
Four Formulas Junked.
The decision to ask for an in
crease in the lump sum means the
joint committee iunked, for the
time being at least, four proposed
formulas for fixing the annual
Federal share. These included the
Overton O'Mahoney Hebert, the
Koran and the Buck plans.
The first two were based on Fed
eral land ownership here and the
third on population. A fourth plan,
not yet formally introduced, was
developed by Parker L. jackson, tax
expert of the Bates group and is
based on economic conditions In
the District.
I'VE simply haven't been able to
agree on formula" explained
Senator Cain. I'VE just couldn't
work out what we wanted"
The revised income tax bill was
developed by District lawyers at the
request of Mr. Bates, both to remedy
some of the defects of the existing
law and to try to head off a sales
tax. The bill would tax the income
of persons who live here for seven
months of the year, but would
credit against such tax any income
or Intangible tax paid to state.
The tax on unincorporated business
income would carry a $4,000 ex-
emption and would not cover pro-
LESSONS in which 80 per cent of
gross income is for personal services.
Both the corporate and unincor-
porated business levies would be
taxed at S per cent. Present per-
sonal income rates would be un-
changed.
Realty Plan No Surprise.
Mr.. Bates announced to newsmep
early in the tax study his opinion
that real estate rates are too low
here. His plan to raise them Is cents
came as no surprise.
Decision to include the gasoline
tax boost-sole remnant of the Com
earlier program-was
based on the need for increased rev.
enues to finance key construction
projects, Mr.. Bates explained. These
included the South Capitol Stree
Bridge, the twin-bridge Replacement
of the Highway Bridge, the K stree
elevated thoroughfare and others.
without this tax increase thes
projects would have to be stopped,
Mr.. Bates said.
In the case of the water fund, the
House subcommittee chairman said
his plan would place the water sys-
tenn on a pay-as-you-go basis that
would not require the So. 600, 900 in
Federal loans originally proposed by
the city to finance expansion.
He o-..imated his program would
save e city some 10000, 900 in in
te- payments on the loans.
Water Fund Surplus.
Mr.. Bates said the water fund
cow has $4,000, 900 surplus that can
&c used for new construction during
1913, The 25 per cent boost in water
rates would add $500, 600 to the an
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