Memorandum of Disapproval of Bill for the Relief of the City and County of Denver, Colorado.

I HAVE WITHHELD my approval from H.R. 2750, "For the relief of the city and county of Denver, Colorado."

This bill would authorize a payment of $4,741.72 to the city and county of Denver, on account of street improvements in front of property of the United States adjoining Lowry Air Force Base. This represents the amount that would have been assessable against the property if it were privately owned.

Considered simply in terms of the specific facts, the claim for payment seems equitable. The Department of the Air Force has stated that the improvements "are definitely beneficial and desirable to the community and to the adjacent Federal property." Since there is no legal authority under which the Department can make payment, special private legislation is the only avenue of relief presently available.

But the claim covered in this bill is not unique, nor are the facts so peculiar and local that approval would set no precedent. On the contrary, there are indications that if the bill is approved other communities may be expected to press similar--and perhaps equally meritorious--claims to payment for local improvements adjacent to Federal real property.

A long established principle of law and policy in our Federal system of government is the constitutional immunity of the Federal Government from State and local taxation, including special assessments, and the reciprocal constitutional immunity of State and local governments from Federal taxation. A breach of one immunity could weaken the other.

In the past, the Congress has never consented to the general application of special assessments to property of the Federal Government. Legislation has been enacted from time to time granting limited consent to State or local taxes designated Federal properties or activities, or providing for payments in lieu of taxes under specified conditions. A few of these laws have permitted special assessments on certain Federal properties. On the other hand, the Congress has had before it bills proposing to grant general consent for the levy of special assessments for local improvements beneficial to Federal Government property, but such legislation has not been enacted.

The present Congress recently approved my recommendation that a Commission on Intergovernmental Relations be established to study the means of achieving a sounder relationship between Federal, State, and local governments. I believe that the exercise of taxing powers is within the scope of the Commission's assignment, and I shall request that its report include recommendations as to how to solve the many difficult problems which arise in the field of intergovernmental tax immunities.

The basic question underlying the enrolled bill, H.R. 2750, is whether the Federal Government should adhere to its constitutional tax immunity or should forego it in this particular instance and possibly in other cases. Since this involves the question of modifying a long established policy, I believe that it should be decided broadly and deliberately, rather than through a succession of piece-meal decisions on individual requests. Moreover, I believe such a decision can best be reached in the light of the general suggestions which will be derived from the work of the Commission on Intergovernmental Relations.

DWIGHT D. EISENHOWER