Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, July 29, 1990 TAG: 9007290048
SECTION: NATIONAL/INTERNATIONAL PAGE: A12 EDITION: METRO
SOURCE: Associated Press
DATELINE: MOBILE, ALA. LENGTH: Medium
"The deductibility of state and local taxes should not be further eroded," said Iowa Gov. Terry Branstad, a Republican and chairman of the National Governors' Association.
He said Republican and Democratic governors were united in opposition to the proposal by the Bush administration and congressional Republicans to raise more federal revenue by reducing the ability of taxpayers to deduct state and local tax payments from their federal tax bill.
Republicans were wary, however, of talk among Democratic governors of offering a resolution or other statement condemning the deepening savings and loan scandals and perhaps suggesting a national commission of inquiry.
Anticipating a possible Democratic-led resolution on the problem, Branstad said at a news conference that there was no need for partisan finger-pointing on the S&L issue - but that there may be regional blame.
Branstad said he was "madder than hell about being asked to pay for that because I went through the agriculture crisis in the mid-'80s. . . . I had millions of people in my state that suffered greatly. We didn't get a lot of sympathy through that time and I don't like the idea of paying the bills for the extravagance of those people involved in the S&L crisis."
Democratic governors met privately Saturday in Pascagoula, Miss., in a home overlooking the Gulf of Mexico. Democratic Gov. Bill Clinton of Arkansas said the Democrats were trying to reach a position on a S&L policy.
The governors argue that limiting or eliminating deductibility, in addition to raising federal taxes for individuals who itemize their deductions, would make it more difficult for states to raise additional revenues to provide new services - and might lead to increased pressure to lower state and local taxes.
Several Democratic governors were considering offering proposals on the savings-and-loan costs, including Richard Celeste of Ohio, Michael Dukakis of Massachusetts and Douglas Wilder of Virginia.
One plan circulated by Wilder would call for a national commission to investigate the collapse of savings and loans that threatens to cost federal taxpayers as much as $300 billion or more in bailout costs.
by CNB