Evening star., 1949-03-17
Federal Grant of S18,600,O00Anti- Tito War
For District Asked by McGroth On, Reds Radio
ToEnd City's Financial Dilemma ReportedSaying
Senate Bill Calls for
Sum in Addition to
12-MilIion Payment

l2-MiI|ion Payment !
An outright Federal grant of
$18,600,000 to the District. to help
finance the sorely pressed city in'l
the next fiscal year, was proposed
today by Chairman McGrath. of
the Senate District Committee.
Senator McGrath introduced
bill to this effect in the Senate,
with the explanation that the
grant would be an addition to the
$4,000. 900 payment toward Dis
trict finances now pending in the
city supply bill.
His proposal, high lighting the
District financial emergency, came
three days after the House voted
down the District revenue bill con-
tanning a sales tax and a high
level income tax which would have
balanced the budget. IVA
Fiscal Survey Urged. I
Furthermore, Senator McGrath
today proposed in separate reso-
luton that the Senate District
Committee be directed to make
full and complete study and in
vestigation" of the fiscal affairs of
the District. The sum of $50,000
would be provided from the con-
tingent fund of the Senate for this
purpose on vouchers approved by
the Chairman of the Senate Dis
trict Committee.
The committee or some subcom-
mittee would be authorized to
employ OIL a temporary basis such
technical, clerical or other assist
ance it needed for the investiga-
ton.
The District Committee would
be asked to report to the Senate
"at the earliest practicable date"
the results of its study together
with recommendations.
Senator McGrath said that he
introduced these measures for a
new approach to the solution of
the Districts financial dilemma
because there was no chance OF
getting sufficient tax legislation
approved by Congress.
Move Is Surprise.
The Rhode Island Senator's
move came as a surprise, be-
cause of the magnitude of the
money involved.
He explained that The 1890 |
900 figure was Federal grant |
which need not be repaid out of
city revenues.
The McGrath bill specifies that /
the grant is only for the fiscal
year beginning July l.
The bill says that the Federal
grant shall be sum mot exceed
ing $18, 100000 as may be neces-
sary to enable the District Of CO.
lumbia to meet it's necessary ex-
penses" for the next fiscal year.
Both the McGrath measures
were referred to the Senate Dis
trict Committee. They will be
taken up for action at the next
regular meeting at 10 am. Tues
day.
Strategy Meeting Monday.
House District Committee men,
bers who oppose a sales tax, mean
while, plan to meet Monday to
plan strategy for solving the Dis
trict's budget problem, probably
with a combination of other tax
increases and a larger Federal
payment.
AS members of the Klein-Ken-
nedy group prepared to chart a
course of action. city officials
totted up the number of vital mu-
nicipal services that will have to
be cut from the 1850 budget un-
less new sources of revenue are
provided.
Failure of the House to pass the
2 per cent sales tax bill has left
the District facing an $4,000, 900
deficit even without a $3.50 pay
raise for city employees. Enact
ment of q retroactive pay raise
would cost an additional 100000
600.
The House cut 1854, 900 from
the 1850 budget only a few days
before killing the combination
sales tax and high-level exemp-
ton income tax revenue bill Mon
day. This measure was planned
to balance a. budget that would
include the pay raise.
Another $2.500,000 may have to
be cut from the District budget to
make it balance If Congress fails
to provide new revenue sources.
Worst hit by the unbalanced
District budget are Gallinger Hos