Evening star., 1951-06-02
D. {. Tax Boost
Seen Despite
Budget Slash
Appropriation Bill
Cut So Million by
Butes Subcommittee
By Don S. Worren


Budget. Pose A-3
Reduced Enrolment in White High Schools
Moy Bring Teacher Cut. Pooe A-3
bill, to trim requested expendi-
lures repeatedly by nearly SO mil
lion to keep financing in balance
in the year beginning July /.
And it raised greater concern
for the future, provoking discus
sions of bond issues, Treasury
loans, higher taxes and a pointed
suggestion for 25 per cent in
crease in city water rates.
Publication today of the tram
script of the recent closed hear
ings by the Bates Appropriations
Subcommittee made clear the city
could meet its big new spending
plan. with some cutbacks and
postponements. provided only that
there was no cut in the Federal
payment and no raise in city gov.
ernment wages.
Warning by Fowler.
Both, however, are proposed,
and Budget Officer Walter L.
Fowler warned again that either.
or certainly combination of the
two, would mean higher taxes or
drastic budget cuts, or both.
Against this background, the
House hearings reveal, District Of
f1cials wrote into the official rec
ord a lengthy and documented
justification for a grant of a full
$12 million as the Federal share
of National Capital costs. This
laid the foundation for a deter
mined fight against an intended
move by Representative Taber,
Republican of New York, and
Others to chop the Federal pay
ment down by 10 per cent or more.
Last year. at the urging Of
MIR. Taber, Congress cut 10 per
cent. or $1.2 million off the
|$12 million payment authorized in
basic law.
Because of imitation, it was
charged that the United States
now is underpaying the District
by 100000 a year on the amount
of city water it uses for its Fed
eral agencies. OF the Federal
payment, 81 million is granted to
pay for Government water use.
The actual bill, the House group
was told by Water Supt. David
Auld, is $1.2 million.
illustrates Issue.
This brought from Representa-
tive Furcolo, Democrat, of Massa-
chusetts. a declaration that the
water payment is an excellent
illustration" of the Federal pay
ment issue.
THE Federal Government says,
in a high-handed manner, We
use the water but we are going
to pay you only ST million in spite
OF the fact that the actual cost
is 100000 more than that" Mr..
Furcolo commented.
! Mr.. Auld detailed the effects of
initiation. Discussing the $23 mil
lion Treasury loan Congress has
authorized for the long deferred
expansion of the citys water
supply, $50 million of which now
is requested, Mr.. Auld said in
flated costs have made it "obyi-
ously hopeless" to depend solely
on this source of funds.
He put it this way:
1T is apparent that, in addition
to the $25 million originally au-
thorized as loans to the water
fund, an additional SITS million
would be needed by 1868.
IF we assume interest costs at
LIS per cent and if the inflation-
airy increases also were borrowed.
the water system would owe ap-
proximately $50.2 million by 1870.
1T would not get out of debt
until the year 2025, or 73 years
hence. and over that period 1.-THE
District) would have made interest
payments aggregating $38, ,250, 900.
Any such financing is obviously
hopeless and, therefore, more bor-
rowing to keep up with imitation is
not the solution"
He said. therefore, there was no
(See BUDGET. Page A-3)