Evening star. [volume] (Washington, D.C.) 1854-1972, 1954-01-28
Forecasts of Future Deficits
Cloud Public Works Program

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future deficits, even with in
creased revenues city officials
propose now. loomed large today
in congressional reaction to the
Capitals $305 million public
works program.
| This was apparent from COM
mentS by House and Senate Dis
trict subcommittee members con-
sidering the works program yes
terday.
Questions they raised bore on
projected city revenues and ex-
penses for the next 10 years. pre-
pared by Budget Officer Walter
L. Fowler. One of the studies
presupposing that the works
program is carried out and that
new revenues are provided
starting this year-showed an
accumulated deficit of $102 mil
lion at the end of 10 years.
Mr.. Fowler said the $102 mil
lion figure had no real mean
ing, since 1t is an accumulated
figure from year to year. Actu-
ally, he explained, the District
must submit a balanced budget
every year.
Lists Alternatives.
If his projections prove cor
rect, therefore, he said, what
would happen each year is that
/ city officials either would have
to trim their expenses or find
new revenues.
| He stressed. however, that flu
ture economic trends could
wreck the projections completely
and turn the forecast deficits
| either into SURPRISES or worse
| deficits.
| Chairman Case of the Senate
District Committee said he failed
to see "how any one has enough
OF a crystal ball to see what
construction costs, for example,
will be 10 years from now"
Other members, however, voiced
more concern.
Representative Harris. Demo-
crat. Of Arkansas said the pro-
jections threw a cloud over the
works program. He accused the
city officials of proposing new
revenues to carry out a $305 mil
lion program one day, and of
| saying there might not be
enough money to do it the next.
Complement for Candor.
Chairman O'Hara of the
House subcommittee compli-
mented Mr.. Fowler for your
candor and honesty" in present.
ing the deficit forecasts.
But I do suggest" he added,
that those of us most friendly
to this whole program are faced
with the problem of convincing
our colleagueS-we must present
the program with the same can
dor to the House and Senate"
Mr.. Fowler stressed that the
future estimates applied only to
the city's general fund. which
finances such vital construction
as schools, hospitals and welfare
institutions. Future prospects
are bright, he said. for funds
supporting water. highway and
sewer projects.
Mr.. Fowler's major testimony
dealt with the need for a higher
Federal payment to the city. The
works program financing plan
Includes SO million annual
boost in the Federal payment,
SO million more in local taxes
and-over the 10-year period
Federal loans totaling Sill
million.
The budget officer carefully
traced the history of the Federal
payment from the 10Th century,
when the Federal Government
paid half of the city expenses. to
its present shrinkage per cent
of the District budget.
Bluntly, he told the committee:
1--WE feel we're not getting what
we're entitled to get by virtue of
what we're doing, and what we
are paying"
Gives Preferred Formula.
Mr.. Fowler said a fair and
equitable formula for setting the
Federal payment was hard to
find but that he has personally
reached the conclusion that the
easiest and best is the original
idea of those creating the dis
trict) Organic Act"
ut is suggested that the pay
ment be based on a percentage
/ Of appropriations subsequently
adjusted each year to expendi-
lures" he said.
At present, the payment is a
fiat Sill million a year, plus 81
million fiat payment for water.
The District. in the works pro-
gram, is proposing that the pay
ment be raised to $40 million a
year. But Mr.. Fowler conceded
he would have hard time decid-
ing on the fairest percentage to
set for the payment.
II don't see how there can be
a permanent solution because
nobody in Gods world knows
what's going to happen" he de-
clared.
Mr.. Fowler noted that the gen.
eral fund has been able to sup
port substantial construction
during recent years. but in
creased expenses have "dried up
the SURPRISES we were living on {"