HEARING STATEMENT ON THE DISTRICT OF COLUMBIA STRUCTURAL IMBALANCE SENATOR MIKE DeWINE, CHAIRMAN JUNE 22, 2004, 10:00 A.M.
Good morning. This hearing will come to order. Today we will hear testimony regarding the District of Columbia’s long-term structural imbalance. This imbalance represents a gap between the District’s ability to raise revenue at reasonable tax rates and its ability to provide services of reasonable quality to its residents.
I recognize that the structural imbalance is driven by expenditure requirements and revenue restrictions which are mostly beyond the control of the District’s leadership. Clearly, the city’s revenue capacity would be larger without Federal constraints on its taxing authority, such as its inability to tax federal property or the income of non-residents.
I agree that the city faces a troubling problem in the long-term. I want to help close the financial gap and help ensure the long-term economic health of our Nation’s capital and the seat of our Federal government. This is a Federal enclave, established by the Constitution and it must live by the constraints imposed on it by the Federal government.
I believe that the Federal government must recognize the costs it places on the city and the burden it places on the city’s infrastructure, all the while limiting the ability of the city to raise revenue. Indeed, many of the problems facing the city result from it being the seat of the Federal Government.
At today’s hearing, we will begin a bi-cameral, bi-partisan discussion about ways to address this structural imbalance. We have assembled a very distinguished group of Congressional leaders, city leaders, business leaders, and academicians to help determine ways to eliminate this structural imbalance. This marks the first step in what I hope will be a solution to the city’s financial problems.
As Chairman of this Subcommittee, I will work to explore and develop ways to avoid a financial catastrophe for the District. It is our duty and our responsibility to make sure that this city is placed on solid financial ground.
My Ranking Member, Senator Landrieu is testifying before another Committee and will join us shortly. As usual, witnesses will be limited to 5 minutes for their oral remarks. Copies of all written statements will be placed in the Record in their entirety.
