Evening Star Newspaper, October 25, 1936, Page 9

- CITIZENS TO ASSIST FISCAL COMMITTEE Liaison .Group Requested at Close of Hearing of Dis- trict Suggestions. (Continued From First Page.) revenues unless the Federal contribu- tion is increased and other funds are forthcoming. The Commissioners, Donovan sald, sent the 1938 budget to the Budget Bureau in two parts. The primary budget will provide for nor- mal operating expenses only, he said, whereas the secondary budget con- tained items for capital improvement totaling $4,500,000. The District, he declared, should spend $8,500,000 every year for capital improvements. Maj. Donovan also pointed out that the District is receiving $8,200,000 less in revenue today than it did five years ago, but in the interim operating costs had jumped and the expenditures per capita improvements had decreased. Members of the committee ques- tioned Maj. Donovan sharply about the so-called surplus revenues which at one time amounted to $9,569,000 and have completely disappeared. Don- ovan said these surplus funds were accumulated as a result of the policy on the part of the Budget Bureau of slashing of the budget coupled with the refusal of Congress to permit the District Commissioners to lower the tax rate. These surpluses were put into capital expenditures, he explained, more than $6,000,000 of which was spent in acquiring the site for the proposed monumental municipal cen- ter. Roberts Reviews Plan. William A. Roberts, retiring people's counsel, was recalled to explain more thoroughly the plan he proposed for solving the fiscal relations problem through the creation by Congress of a permanent commission which annually would fix the amount of the Federal obligation. Considerable interest was manifest by the President's committee in the Roberts plan and he was urged to sub- mit a brief containing a comprehensive and detailed outline. Roberts also was asked for a report on the studies he made several years ago of & plan for reorganizing the District government. He told the com- mittee he would be unable to furnish it for “seven days’—alter which he will no longer be in the District service. In the midst of discussion of the proposed reorganization of the munic- ipal government, it was revealed that nine volumes had been written and presented to the Senate District Com- mittee, but that the tenth and final volume, including conclusions and rec- ommendations, never was formally completed. The nine volumes of factual infor- mation showing an investigation not only into the District of Columbia government, but into municipal gov- ernments in many parts of the world, had been completed and signed by the three members of the committee, Lewis W. Douglas, then director of the Bureau of the Budget; Donovan and Roberts. Made Own Findings. But, Roberts explained, “due to po- litical issues and differences between himself and Donovan,” the tenth vol- | ume of findings never was finished. He did not explain what he meant by “political differences.” Roberts had sent up to the Senate committee a report on his own findings. Asked by Chairman McAneny whether the tenth volume was avail- able, Roberts said it was not. He in- dicated it had once been locked up but that now it was “not available or extant.” Comments at the District Building gome months past had indicated Roberts was in favor of a major change in the present form of gov- ernment, whereas it was understood that Maj. Donovan held the insistent view that while there might be some worthwhile changes in various de- partments, the commission form of government should be preserved at all costs, As a matter of fact, it was apparent @t the District Building at the time that Roberts had written the major portion of the exhaustive city govern- ment report himself, and that, in fact, even a representative of the budget director had very little part in either the study or the writing of the volumes which Roberts submitted to the Senate District Committee. Chairman McAneny pursued the possibility in these municipal studies of a saving in the District govern- ment reorganization. Roberts was finally pressed to say he believed *savings in reorganization very defi- nitely” could be accomplished. Donovan explained he was not op- posed to departmentalization of. the District government. Budget Procedure Hit. After the prolonged discussion of the omitted tenth volume, Clarence A. Dykstra, city manager of Cin- cinnati and a member of the Presi- dent’s committee, injected into the hearing the subject of secrecy of Dis- trict budget-making procedure. Repeatedly, Dykstra had sought from witnesses an expression as to Whether “there is a general agree- ment for public support of the esti- mated $48,000,000” budget for 1938. “There is disagreement,” interjected Rufus 8. Lusk, secretary of the Washington Taxpayers’ Protective As- sociation. “There is disagreement on several items. Yes, sir!” Later Lusk disclosed his organiza- tion is opposed to any item in the budget for direct relief, and an in- crease provided for the police and firemen pension fund. “Our sssociation feels there is no occasion for any direct relief in this town,” shouted Lusk. “The town has been prosperous for three .years. 1 don't think there should be a nickel spent for direct relief, as it is spent in the District.” Lusk called attention to the increas- ing cost of the police and firemen’s pension fund, and declared the pen- slon system should be revised and placed on an actuarial basis. He said the fund had increased from $150,000 in 1920 to $750,000, and eventually #it will cost us several million.” Donovan Answers Aitack. As Dykstra pursued still further his inquiry as to public interest in and support for the proposed budget, he provoked Maj. Donovan to a spirited discussion of the secrecy thrown by law sround the budget procedure. “The law prohibits the Commission- ers from making the budget public,” declared Donovan, “until it goes to The Commissioners may have asked a certain sum, but the Bu- reau of the Budget does not send to Congress what the Commissioners es- timated. We can't brief the budget because it's against the law.” He explained that the recommenda- tlons of the various District depart- N § ments to the Commissioners were made public, but not the Commis- sioners’ report to the budget in detail. “This is the most confounded appro- priating system,” chimed in Roberts. “The Federal Government controls expenditures down almost to s lead pencil. There is no effective way for a citizen to protest.” Roberts also charged that the gen- | eral public was hampered by what he called “false economy in regard to reports.” He criticized what he called the “customary habit, the lazy habit,” of giving only the large sums proposed, but omitting detail. Clayton Urges Representation. The disfranchised status of the residents of the District was stressed |as a vital factor in the problem of fiscal relations by William McK. Clay- ton, veteran civic worker, who for many years has been chairman of the Public Utilities Committee of the Federation of Citizens’ Associations, Clayton, who had been an inter- | ested observer throughout the long ses- sion suddenly arose and asked the committee to consider the political inequity, in connection with the fiscal inequity of the District. “We have no vote, no participation |in the Government, no control over | expenditures or the collection of | taxes,” Clayton declared. “We be- lieve that if we had the vote, if we | could levy, collect and disburse our own taxes, we would be far better| off in the way of expenditures. There would be a direct guardianship over the people who spend our money.” Clayton denounced the “patronage” situation which he said existed under the present relations between District officials and members of Congress. He said if s Senator should happen to move on an unimproved street, it would not be long before that street was improved. Clayton also claimed that members of Congress influence & number of ap- pointments in the District service. ; Dykstra asked him how many em- | ployes there are in the District service. ; | He was told there are 15,000. | “There is considerable patronage | among them,” remarked Clayton. | | “I would say a considerable pay | roll,” remarked Dykstra. Appointments Criticized, Dykstra was told that while some |of the District’s employes, including | members of the police and fire de- partments, are appointed from the civil service register, there are a num- ber of others who are appointed either by the Commissioners or various agen- cies of the District. “It's & civil service that works when you don’t want to appoint somebody,” injected Roberts. He also declared that while some of the employes are appointed under civil service, they don’t have the protection of the civil service. Clayton resumed his argument on national representation and pointed out this time that “the Federal Gov- ernment has complete control over the finances of the District.” Clayton complained that in the form of government here, there is no vote, and started to explain further, when he was interrupted by Dykstra, who declared: “In other words, you have a good government.” Clayton took up the challenge. “One Commissioner here characterized the District government as an absolute despotism,” he declared. “You say it is an ideal form of government. Why is it that no other city in the United States has gone to it? We are unique and struck down.” Clayton concluded with a stirring plea to the experts to consider the voteless plight of the city in connec tion with fiscal relations. Federal Holdings Growing. Several times the question of “the ever-increasing Federal holdings and the effect on Washington bobbed up. Richards first called attention to the value of the Federal property when he said the amount of the contribu- tion should be between $8,000,000 and $10,000,000. Later, Anderson said studies made by his organization showed that the United States owned 37 per cent of all property in the District. James W. Martin, chairman of the Kentucky State Tax Commission, the third member of the President’s com- 4 mittee, said he would like to have evi- dence to show whether the removal of District_property from the tax rolls by the United States is reducing the tax revenue. - “I believe it does,” said Anderson. “The figures do not show that,” re- marked Dykstra. Roberts joined in the argument and declared that as the Federal property holdings increased, residential prop- erty is reduced, and “it becomes in- creasingly expensive to live in the District.” “We all know about that, too,” re- marked Dykstra. As the final hearing opened, Chair- y reassured Colladay 1—William A. Roberts, re- tiring people’s counsel, urging the creation of a permanent commission to fix annually the amount the Federal pay- ment toward District expenses, at the closing session of a public hearing conducted by the President’s special fiscal relations investigating com- mittee. 2—William P. Richards, for- mer District taz assessor, who came out of retirement to stress the injustice of the present $5,000,000 Federal yment. 3—J. Nelson Anderson, gen= eral counsel of the Federation of Business Men’s Association, urging a return to the 60-40 substantative law. —Star Staff Photos. -tigation the committee is making. Mc- Aneny declared it is not the purpose of the committee to use the cost of services data it has collected, as a “yardstick” or as an important ap- plication to the case. “That is not our purpose at all,” he said. “That questionnaire to the Government and the District was to find out the de- gree to which these exchanges existed, and try to iron out these questions. We have no final judgment on the matter. We don't know how it will work out. We don't want it to appear that this is an important element.” Matter Rests There. “We look upon that assurance with great favor,” answered Colladay. “That brings us to a very good basis of understanding. We can leave the matter in that way.” The supplemental brief filed with| the Fiscal Relations Committee by the Citizens’ Joint Committee pointed out that any effort to arrive at an esti- mate of the “cost or values” of such services would be only “estimates” unless a definite rule of measurement is applied t» the “tangible fact.” Colladay brought up the item of ex- cess cost to the municipality because of the location here of the Federal Government. “We urge Congress representing the | whole people of the Nation to deal with the District of Columbia on a liberal basis. Unless that be done,” he said, “we can't hope to maintain here a Capital in keeping with the dignity of this country.” | be closely coupled with financial re- He indicated this question of “dig- nity” was a matter difficult to measure | in dollars and cents, and it would be difficult in a large appropriation, for | instance, to ask Congress to “throw in $5,000,000 for dignity.” But, tak- |ing up the item of a new Chain Bridge, as an example, Colladay point- ed out that to rebuild it in its present | location upstream away from monu- mental bridges downtown would cost | an estimated $350,000, whereas if it had been bullt downtown in the style of the Key Bridge, it would have cost & much greater sum. The munici- pality is put to much expense, he said, because of the necessity of maintain- ing this city on a “grand scale.” 25 Per Cent Held Fair, Colladay repeated his advocacy of a fixed proportionate contribution and said a 25 per cent payment by the Federal Government would be fair. Dykstra inquired why he “picked” 25 per cent instead of 33, 18, or some other figure. Colladay replied that 25 per cent represented an impression on his mind after 21 years of study of the fiscal relations problem, and that it also was a “round figure.” Dykstra reminded him that sub- stantive law provides for a 60-40 basis of fiscal relations, and asked if he thought that gave Washington “a lit- tle too much.” “I do,” replied Colladay. Later Colladay said he assumed that the percentage would have to be re- adjusted in about 10 years to meet changing conditions. On the basis of a budget of $48,000,000 for 1938, Col- aday estimated that the Federal Gov- ernment, by the 25 per cent figure, should contribute $12,000,000. Colladay, in order to show that “in every respect we do our full share” cited Federal income taxes paid by residents of the District, as totaling $17,322,929 in the fiscal year ending June 30, 1936. This, he said, is “more than any one of over half of the States of the Union.” Supplementin; his final argument, Colladay read from conclusions in the 246-page brief filed with the Fiscal Relations Committee by the Citizens’ Joint Committee in support of fiscal equity. It referred to the partnership between the United States and the District. “The uncertainty, the confusion, and the general dissatisfaction over the financial relationship now exist- ing,” Colladay read, “indicates that one or the other of the two partners has been remiss in meeting his full obligation.” “We have examined at length the obligation which equity imposes upon both partners. “We have shown that the loca! community, the politically impotent partner, denied a voice in the coun- cils of the partnership, has met and is meeting the obligation represented in assumption of a local tax burden, which, measured by fair standards, is adequate. “We have discussed some of the tax-paying disabilities of the local partner, which make this tax burden unusually heavy. Recalls Early Crisis. “In pointing to the obligations of the exclusively controlling partner, the National Government, we have | shown that in the beginning, when the Capital City was planned and laid out, his exclusive power was to sponsibility. And after nearly a cen- tury of neglect of the Capital City, during which the local community more than once faced bankruptcy, through the assumption of burdens it could never hope to bear alone, & partnership principle with fixed obli- gations on both partners was writ- ten into the substantive law of 1878. “We have shown how the terms of this partnership were put to the test in nearly 50 years of Capital City development, during a period which witnessed the transformation of Washington from a sprawling, over- grown, ugly village—bringing disdain- ful reproach upon America from those who visited it, into one of the most beautiful cities of the world, & source of patriotic pride to all Amer- icans, a symbol of the spiritual as- pirations and the material achieve- ment of America. “We have shown how these years of | rapid development under the wise partnership principle of 1878 have been followed since de facto abandon- ment of this principle by the con- trolling partner, by increasing diffii- culties in adequate financing of the needs of the community and the C. OCTOBER 25, 1936—PART ONE. and occupant of extensive tax-exempt property and taking into account other factors involving the added municipal costs due to the fact that this is the National Capital and the magnificent scale of its plan and de- 'velopment. “We have shown the additional, ex- tensive obligations of Nation to cap- ital, not so easily measured in dollars and cents, but which are to be con- sidered in any attempt to arrive at a fair method or formula by which the expenses of Capital City maintenance and development are to be shared be- tween the local community and the Nation. “Ne. Substitute.” “We have not attempted to suggest the method arriving at what is a fair and equitable amount ta be appro- priated by the United States, in sup- port of its Cepitai City, but experience of the past indicates that we-are of the definite conviction that as the governing and financing of the Cap- ital are inseparably intertwined, there can be no substitute for the wise prin- ciples of the law of 1878, as amended but never repealed by the Congress. which fails to couple the power of the United States to contral with its obli- gation to maintain and develop. “And we cannot believe that any substitute for this wise principle will be equitable and just to the people of the District of Columbia, which, while providing for the adequate mainte- nance and development of the Capi- tal City, fails to accomplish their protection against whimsical and ex- cessive taxation at the hands of an alien and changing legislature.” Colladay explained to the Presi- dent's committee that the chairman of the Citizens' Joint Committee, Theodore W. Noyes, had been unable to attend the sessions, but “would be very glad to answer any question- naires, or co-operate in any way,” with the investigators. Chairman McAneny told Colladay the presentation of the Citizens’ Joint Committee had been “most helpful,” and he hoped to keep in “continuous” touch with it. AIDE OF DILLINGER WILL BE QUESTIONED Information From Convict Will | Cause Grilling of Another in Unsolved Slaying. BY the Associated Press. MINNEAPOLIS, Minn., October 24 —Authorities tonight said they would question a one-time member of the John Dillinger mob concerning the unsolved assassination two years ago of Howard Guilford, weekly newspa- per publisher, after & “tip” from & | State prison inmate Peter S. Neilson, assistant county attorney, said Tommy Gannon, serv- | ing a term for robbery in the St Cloud State Reformatory, would be interro- gated. Neilson said the questioning would | be on a “tip” from Arthur (Wicky) Hanson, who said the late Walter Lig- gett, another weekly newspaper pub- lisher, who was the victim of an un- solved slaying in 1935, told him Gan- non knew about Guilford's death. Hanson told Neilson, the assistant county attorney said, that he “under- stood” from Liggett that the latter was shot because of meddling in the | Twin Cities bootleg liquor traffic | through publication of names in his | paper: PAY ROLL NOTICES STIR DEMOCRATS Gov. Earle Asks Justice De- partment to Halt Tax Lit~ erature to Workers. Gov. George H. Earle appealed yes- terday to the Department of Justice to take action against employers who are putting notices of the security tax deductible beginning January 1 in the pay envelopes of their employes. The Pennsylvania Governor, who, with Senator Joseph F. Guffey, heads the Democratic political machine in charge of the New Deal campaign, cN\urged that the Pennsylvania Manu- facturers’ Assoclation was distributing pay envelope inclosures containing “half truths and deliberate falsehoods about the social security act. The activities of the manufacturers, he asserted, amount to a “conspiracy to prevent the effective workings of a statute of the United States.” ‘The Department of Justice was un- able to say whether any action would be taken. Gov. Earle wrote a second letter complaining about the activities of the Pennsylvania manufacturers to the Soclal Security Board. In his letter to Attorney General Homer 8. Cummings, Gov. Earle said: “I will be very grateful if the de- partment will ascertain if this action (referring to the insertion of inclo- sures in pay envelopes) does not con- stitute a violation of tne Federal laws.” To the Social Security Board, the Governor complained that “the ac- tivity of the Pennsylvania Manufa turers’ Association in seeking to mis- lead employes concerning the opera- tion and benefit of the social security law is a part of the campaign on the | part of industrialists throughout the Nation to arouse their employes against the law.” Gov. Earle sent to the Department of Justice copies of placards which he said had been posted in factories in his State. He charged that the plac- ards attempted to make it appear the | Federal Government was imposing a tax on wages without explaining that | the tax was to help build an old-age | pension reserve. | ber 30. He also took exception to the state- | ment contained in the explanatory | placard that the tax “is to be used for the general purposes of the Govern- ment.” | “Instead of telling the truth” the Governor said, “the Pennsylvania Manufacturers’ Association—dastardly in my opinion—is conspiring to mis- lead the workers of Pennsylvania and give them a wholly false impression of | the law.” | Another exhibit forwarded to the Department of Justice was a letter on the letterhead of the association, signed by J. M. Flynn, its president, offering to supply employers with bill- | board and pay envelope literature. Although Gov. Earle was the first to | ask the Department of Justice to in- tervene, Democratic leaders in other parts of the country have reported to the National Democratic Committee that they are alarmed over the resent- ment of labor toward the social se- curity tax of which they have been made aware by nejices in their pay envelopes. | (Copyright, 1938 by New York Herald- Tribune SPEAKERS PRAISE CENTRAL MISSION Institution One of Greatest Here, Says Rev. W, S, Abernethy at Banquet. ‘The Central Union Mission was termed one of Washington's “great- est institutions” by Rev. William S. Abernethy, pastor of Calvary Baptist Church, in an address last night at the fifty-second annual banquet meeting of the mission’s Board of Di- rectors in the Hotel Mayflower Dr. Abernethy pointed to the mis- sion’s- value, both from a spiritual and economic aspect The good the mission has accom- plished also was emphasized by James Trimble, vice president of the Board of Directors, and Wilbur La Roe, jr., member of the board. Their speeches, broadcast over Station WOL, were in the form of replies to questions asked by E H. De Groot, jr, president of the board. Business Example. Mr. Trimble, well known banker, told how the board of directors begins all its meetings by asking Divine guid- ance in conducting the affairs of the mission and said that “if every busi- ness had followed this same policy, | there would have been no panic| in 1929.” John S. Bennett, mission superin- | tendent, presented a report showing the mission had provided 133,800 free meals and 51,532 lodgings free during the 12-month period ended Septem- This compared with 99.584 | meals and 38,665 lodgings provided | in the previous year. A repor on the work of the Chil-| dren’s "Emergency Home and Camp | Bennett was made by Mrs, Bennett, director. The program was opened with in- vocation by Rev. Dr. W. Angie Smith, pastor of Mount Vernon Place M. E. Church South. During a short busi- ness session two directors, Jackson A ‘Winner, treasurer of the board, and William H. Ramsey were re-elected The Mission Glee Club and Homer Hot-Water Heat in: Any product Pavments star! Rodeheaver sang. Mr. Rodeheaver also led the assemblage, numbering several hundred persons, in singing. Among distinguished guests introe duced were Bynum Hinton, president of Kiwanis Club; Lester Fancher, president of the District Epworth League ,Union; George W. Stimpson, president of the National Press Club; Miss Ruth Robinson, president of the | Business and Professional Women's Club; Capt. A. E. Nesbitt, president of Optimist Club; Page McK. Etcufe son, president of the Organized Biblg Classes of Washington; Mrs. M. Ly Hume, president of Quota Club; Miss Marie C. Tedrow, vice president of Soroptimist Club; Mrs. Dorothy Here ing, vice president Venture Clubs; | Mrs. Harvey W. Wiley, president of Women’s City Club; Mrs. G. C. Thorpe, president of Women's Safety Council; Miss Mabel Strider, president of Zonta Club; Rev. Dr, Freeley Rohrer, presi- dent of the Mission's Ministerial Council; Dr. Gover G. Johnson, vice president of the Ministerial Council, and Strickland Gillilan. — Montana Population Decreased, Montana was the only State to show a decrease in population between 1920 and 1930, the decline being 2.8 per cent, s sure of & geod 0'Brien and _his n the largest dance floor in the eity. prices, Ladies, S0 1 your evening by 13th & E Sts. 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Principle “Temporarily Abandoned.” “The partnership principle has been temporarily abandoned in favor of what President Roosevelt once dis- paragingly characterized as & ‘hit or miss’ system of appropriations which imposes no limit upon the contribu- tion to be exacted from the politically impotent, silent partner—the local community—but arbitrarily limits, and has steadily reduced the contri- bution of the exclusively controlling National Government, | “We believe that the path to equitable adjustment of the fiscal relations issue lies in study of the various sources of the very tangible obligations of the National Govern- ment in maintenance and support of the Federal City.” The statement then called atten- tion to Parts I and II of the brief which discussed the “local partner’s obligation and the manner of its fulfillment,” and the “nature of the Federal obligation and the manner of its evasion,” and continued: “We have shown that this obliga- tion is susceptible of tangible meas- urements in dollars and cents based on appraisal of the obligations of the National Government as the holder Use “MURCO" Paints and Varnishes on your floors, walls - Have you @ major Paint- ing Plan in mind? 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