CONGRESSIONAL RECORD -- SENATE
March 1, 1966
Page 4332
LIABILITY OF CERTAIN PERSONS FOR PAYMENT OF PROPERTY TAXES
Mr. MUSKIE. Mr. President, I introduce, for appropriate reference, a bill to permit States or other duly constituted tax authorities to subject persons to liability for payment of property taxes on their property located in Federal areas within such State under specified conditions.
This bill would eliminate an intergovernmental friction point that has concerned Federal, State, and local officials for many years. It implements a recommendation of the Advisory Commission on Intergovernmental Relations, on which I have the honor, along with Senators ERVIN and MUNDT, to represent the U.S. Senate.
There are, Mr. President, some 5,000 individual areas of land scattered throughout the United States where the Federal Government has exclusive legislative jurisdiction. In these enclaves, States and their political subdivisions can exercise their governmental powers only to the extent that Congress gives its consent. In a series of acts dating back to 1936, Congress has consented to the application of most categories of State and local taxes within these enclaves in the interest of both equal tax treatment of private persons within and without these areas and of State and local tax revenues. Congress has not, however, consented to the imposition of State and local property taxes on private property -- the only significant tax immunity that remains in these areas.
It should be clearly understood, Mr. President, that the tax immunity afforded property owned by the Federal Government is in no way affected by this bill.
Bills which would grant congressional consent to the taxation of privately owned properties in federally owned enclaves have been introduced in Congress in past years. Two general approaches were tried. One approach would provide unilateral congressional consent to State and local taxation of private property, paralleling previous congressional consent to the application of other types of State and local taxes in these areas. Another approach, proposed by several administrations, would authorize the property-owning agencies of the Federal Government to retrocede to the States legislative jurisdiction over some or all of their properties under specified conditions. Had this legislation been enacted, the property tax question would automatically have been resolved wherever legislative jurisdiction was retroceded. Both types of legislation have failed to gain support apparently because of the absence of any assurance to the Congress that the States would couple the exercise of taxing rights with the provisions of services and privileges to the residents of these enclaves and to their families. This was also the conclusion of the Advisory Commission on Intergovernmental Relations in its report on the subject in 1961.
Since both approaches have failed to make progress, the Advisory Commission recently reexamined the question in order to develop another approach which it believes -- and I share its view -- would reconcile the objectives of all levels of government. The bill I introduce, which embodies the Advisory Commission's approach, does this by granting congressional consent to the imposition of property taxes on the condition that there is in effect a certification "that persons living and working in areas under the exclusive Federal legislative jurisdiction within the State are afforded substantially the same rights and privileges and tax supported services as those available to other residents of the State." Since such certification would be on a State-by-State basis, subjecting private property in Federal enclaves to State and local property taxes could become effective without undue delay, particularly in those States where residents in Federal areas already enjoy all the rights and privileges accorded other residents. Where such is not the case, I believe passage of this bill would speed the extension of the rights of full citizenship to the residents in Federal areas.
Although the bill will have little revenue effect relative to total State and local property tax collections, it can have substantial revenue impact in some taxing jurisdictions, especially in the Western States where 50 percent of the acreage now under exclusive Federal legislative jurisdiction is located. Moreover, its contribution to the overall improvement of Federal-local relations will be large. Because I believe this bill is the proper approach to the twofold purpose of eliminating a long-standing source of intergovernmental friction and assuring the rights of full citizenship to residents in Federal enclaves, I hope it will receive favorable consideration by the Congress.
The PRESIDING OFFICER. The bill will be received and appropriately referred.
The bill (S. 3000) to permit States or other duly constituted taxing authorities to subject persons to liability for payment of property taxes on property located in Federal areas within such State under specified conditions, introduced by Mr. MUSKIE, was received, read twice by its title, and referred to the Committee on Government Operations.