[Congressional Record Volume 140, Number 13 (Thursday, February 10, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: February 10, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
 REMOVAL OF TAX EXEMPTION FOR GOVERNMENT SPONSORED ENTERPRISES IN THE 
                          DISTRICT OF COLUMBIA

                                 ______


                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                      Thursday, February 10, 1994

  Mr. STARK. Mr. Speaker, today I am introducing a bill that would give 
the District of Columbia the ability to bring much-needed revenue to 
its treasury. My proposal would amend the District's Home Rule Act to 
remove the exemption from District taxes enjoyed by three Government 
sponsored enterprises--the Federal National Mortgage Association 
[Fannie Mae], the Student Loan Marketing Association [Sallie Mae], and 
the Federal Home Loan Mortgage Corporation [Freddie Mac].
  My bill is designed to expand the District's tax base. The last thing 
I would want to do is drive these entities out of the District. Thus, 
my bill ensures that Fannie Mae and Sallie Mae maintain their principal 
offices in the District of Columbia, as they do now.
  The District of Columbia just released the audited results of its 
fiscal year 1993 financial statement. Economic recovery is not 
reflected on the balance sheet.
  Each of the city's major revenue sources, the property tax, the 
individual income tax, and the general sales tax, were below estimates, 
and the general sales tax and individual income tax were even below 
fiscal year 1992 receipts.
  There is broad consensus that the future fiscal health of the city 
depends in large part on its ability to expand its tax base. 
Unfortunately, we in Congress must bear some responsibility for a 
deficient local tax base. We prohibit the District from imposing a tax 
on the income of non-residents. And, in granting Federal charters to 
Fannie Mae, Sallie Mae, and Freddie Mac, we shielded them from State 
and local taxes.
  Fannie Mae, Sallie Mae, and Freddie Mac are major corporations will 
billions of dollars in assets and annual revenues. Indeed, they are 
subject to Federal taxation, and in 1992 they had a combined Federal 
taxable income of nearly $5 billion. My bill would remove an 
unwarranted and unfair tax exemption and allow the District to reach 
this income as well.
  Finally, under my bill the Mayor of the District of Columbia must 
report to the House Committee on the District of Columbia and the 
Committee on Governmental Affairs of the Senate detailing the potential 
effects of the bill on the revenues of the District of Columbia.
  I urge my colleagues to support this bill.

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