APPROPRIATION BILL FOR 1934

HEARINGSFORNIA

BEFORE THE

215 Conn

SUBCOMMITTEE OF" HOUSE COMMITTEE

ON APPROPRIATIONS

CONSISTING OF

MESSRS. CLARENCE CANNON (ChairmMAN)
WILLIAM J. GRANFIELD, THOMAS L. BLANTON
WILLIAM P. HOLADAY, AND ROBERT G. SIMMONS

COMMITTEE ON APPROPRIATIONS

JOSEPH W. BYRNS, Tennessee, Chairman

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72d
v. 5

DISTRICT OF COLUMBIA APPROPRIATION BILL,. 1934

HEARINGS CONDUCTED BY THE SUBCOMMITTEE, MESSRS. GLAK ENCE CANNON (CHAIRMAN), WILLIAM J. GRANFIELD, THOMAS L. BLANTON, WILLIAM P. HOLADAY, AND ROBERT G. SIMMONS, OF THE COMMITTEE ON APPROPRIATIONS, HOUSE OF REPRESENTATIVES IN CHARGE OF THE DISTRICT OF COLUMBIA APPROPRIATION BILL FOR THE FISCAL YEAR 1934, ON THE DAYS FOLLOWING, NAMELY:

WEDNESDAY, JANUARY 3, 1933.

STATEMENTS OF LUTHER H. REICHELDERFER, PRESIDENT OF THE BOARD; HERBERT B. CROSBY, AND MAJ. JOHN C. GOTWALS, COMMISSIONERS; DANIEL J. DONOVAN, AUDITOR; AND WILLIAM P. RICHARDS, ASSESSOR

Mr. CANNON. We have the Commissioners of the District of Columbia and the auditor, Major Donovan, with us this morning. We shall be glad to have a statement from them, in opening the hearings on the District appropriation bill for 1934.

GENERAL STATEMENT

Commissioner REICHELDERFER. Mr. Chairman, it is my intention, on behalf of the commissioners to make but a very brief statement concerning the budget of the District of Columbia for the fiscal year ending June 30, 1934. Complete details dealing with the finances of the District of Columbia will be given the committee by the auditor, being contained in a series of statements prepared by him, copies of which I understand have been furnished to members of the committee. Moreover, there is a complete synopsis prepared by the Budget Bureau showing the changes made in the District budget for 1934 as compared with appropriations for the current year, made a part of the message of the President transmitting the National Budget to Congress. In view of this fact, I would be merely covering the same field should I take the time now to go into a detailed explanation of a similar character.

WORK OF SPECIAL ECONOMY COMMITTEE

The commissioners fully appreciate the necessity of holding down the total of the District budget and of eliminating all items that can not meet the test of necessity under conditions existing at this time. Particularly the commissioners feel that if it is possible and if it may be done without impairment of efficient service to the community, operating and maintenance costs of the District government should 934191

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be reduced. In line with this view the commissioners appointed this past spring an economy committee, consisting of the Auditor as chairman, Capt. Herbert C. Whitehurst, director of highways, Daniel E. Garges, secretary to the Board of Commissioners, Stephen E. Kramer, First Assistant Superintendent of Public Schools, Harold W. Baker, director of construction, William P. Richards, assessor, George S. Wilson, director of public welfare, and William A. Roberts, special assistant to the corporation counsel in charge of public utilities matters.

The economy committee conducted hearings on recommendations submitted by department heads for estimates of appropriations for the fiscal year 1934, and within the short time available to it made investigations and studies into the various activities and services of the District government, and submitted a report to the commissioners recommending reductions in personnel in the several departments and in other operating and maintenance costs. The commissioners were exceptionally well pleased with the work of this committee, and approved its recommendations; and I might add that the work of the committee was also complimented by the Budget Bureau.

The commissioners believe that there is opportunity for further reductions in maintenance and operating costs in the District government, and it is their intention that the economy committee during this year shall make further investigations into the various branches and services of the District government for the purpose of accomplishing this result.

The reductions in the estimates for 1934 under the appropriations for 1933, exclusive of reductions made on account of legislative furlough and automatic increases, will be disclosed as the several items of appropriation are reached by this committee for consideration.

DECLINE IN DISTRICT REVENUES

The revenues of the District of Columbia available for appropriation have dropped considerably in the last few years. For instance, at the beginning of the fiscal year 1931 the District of Columbia had in the Treasury surplus revenues amounting to $6,469,144, plus the cash fund of $3,000,000 required by the Act of June 29, 1922, or a total of $9,469,144. In that year the total revenue availability, including collections of current taxes and miscellaneous revenues was $49,917,503. At the end of the fiscal year 1933, it is estimated that this surplus of $9,469,144 will drop to $542,823, and that the revenue availability for 1933 will be $57,902,823, as compared with the total of $49,917,503 in 1931. It might also be noted in this respect that in 1933 Congress had reduced the Federal contribution from $9,500,000 as appropriated in 1932 and 1931 to $7,775,000. This latter amount also is the amount recommended as the Federal contribution to District of Columbia appropriations for the fiscal year 1934.

Certain of the revenue collections of the District have suffered a falling off. In 1931, $20,660,394 was collected from the real estate tax, while for 1932 the amount was $20,238,000. The collections on the tax on tangible personal property, which includes the tax on public service corporations, banks, building associations, and so forth, in 1930 was $4,221,646, and in 1932 this has dropped to $3,928,450.

The collection of the intangible personal tax amounted to $2,661,069 in 1931, and in 1932 it dropped to $2,383,599. The estimated collection of the intangible personal tax for 1933, because of the value of stocks, which forms more than one-half of the assessment base for this kind of property, is $1,500,000, or about $800,000 under the amount collected in 1932. This may be increased somewhat due to the energetic activity of the assessor's office in recommending that property owners who fail to make their returns for their tangible and intangible personal property taxes be compelled to take such action. through the filing of mandamus proceedings in the Supreme Court of the District of Columbia.

The Commissioners, in framing the budget of the District for the fiscal year 1934, did so on the basis of continuing the present $1.70 tax rate.

APPROPRIATIONS FOR 1933, ESTIMATES FOR 1934

The appropriations of the District of Columbia for the fiscal year 1933, including permanent and indefinite items and trust funds, amount to $44,497,622, made up of appropriations items chargeable to the gasoline tax fund, $1,863,700; items chargeable to permanent and indefinite and trust fund, $3,252,000. For the fiscal year 1934, the Budget as submitted to Congress carries a total of $39,743,270 for the District of Columbia. Of this amount, $32,743,370 would be payable from general revenues of the District of Columbia; $2,321,350 would be payable from the gasoline tax fund; $1,731,050 would be payable from the water fund; and $2,947,500 is classified as permanent and indefinite and trust fund items. The Budget total for the District of Columbia for 1934 is $4,754,352 less than the total of the appropriations made for 1933. However, the appropriations for 1933 included the savings under the economy act of June 30, 1932, while the Budget estimates for 1934 are submitted on a net basis, with the amounts for legislative furlough deducted.

The auditor will more fully discuss with the committee these various matters upon which I have but briefly touched, and is prepared to furnish the committee such information as it may desire. May I suggest to the chairman that the auditor be now called upon to discuss these various financial statements which have been prepared by him for the information of the committee?

SAVINGS EFFECTED UNDER TERMS OF ECONOMY BILL

Mr. HOLADAY. May I ask one question there? May I ask the auditor this question: Of this four and three quarters million dollars reduction, what part is represented by the legislative provisions and what part by the furlough provisions?

Mr. DONOVAN. The legislative furlough, and the automatic increases to school-teachers, policemen, and firemen, all of which have been deducted from the Budget estimates for 1934, total $2,229,395.

Mr. HOLADAY. That is what was saved?

Mr. DONOVAN. Let me go back to this statement, Mr. Holaday. In 1933 the legislative furloughs amounted, for all purposes, including the general fund, the gas-tax fund, and the water service, to $2,053,688.