The D.C. City Council went to the aid of homeowners yesterday by voting to reduce residential real estate taxes, and to the aid of homeseekers by voting to raise mortgage interest rates.
On taxes, the council voted to increase each homeowner's exemption to $9,000 from the present $6,000, and to tax residences at a lower rate than businesses, both starting with the bills due in September.
On mortgages, the council - in a surprise move - voted to raise the legal mortgage rate temporarily to 11 percent instead of simply extending the present 10 present maximum, which had been expected.
Before voting the increase, proposed in emergency legislation by Douglas E. Moore (D-At Large), several council members said they were alarmed that mortage financing in the city is drying up.
Lenders have lagged recently in making commitments for fear the city's maximum rate would drop back to the permanent ceiling of 8 percent.
If the emergency bill is signed into law by Mayor Walter E. Washington, the increase would be effective for three months, and be subject to renewal.
Both the tax and mortgage actions were on the crowded agenda of a six-hour meeting, at which the council also:
Sent back to a committee, for redrafting, a bill that would grant Pride Environmental Services a 40-year franchise for erecting bus shelters with advertising.
Tabled indefinitely a bill that would severely restrict smoking in restaurants and public areas of buildings.
Gave preliminary approval to a revamping of the city's umemployment compensation program and the imposition of new taxes on employers to repay a $67 million debt to the U.S. Treasury.
Took emergency action designed to get Congress to restore funds for the proposed civilian enforcement of city parking laws. The council also voted final passage of legislation authorizing the civilian program.
Approval of the tax measure was preliminary, and requires almost-certain final passage July 14, when the actual real estate tax rates probably also will be set.
The present tax rare on all property is $1.83 for each $100 of assessed value, minus the homeowner's exemption on residential property. For the first time this year, separate rates will be set for residences (probably $1.57 per $100) and businesses (probably staying at $1.83).
The measure contains complex features, including an income tax credit for many taxpayers. It would cut an estimated $295 off the present $732 in taxes due from the typical owner of a $40,000 house.
Sponsored by Marion Barry (D-At Large), the bill contains many features proposed in February by Mayor Washington, Barry's political rival.
Barry lost a round yesterday to David A. Clarke (D-Ward 1), who made a motion overturning a provision that would have called for assessing apartment houses as businesses rather than as residences.
Clarke said the 6-to-5 vote cleared the way for him to try to raise business tax rates above the proposed $1.83.
Council Chairman Sterling Tucker, a primary mayoral election rival of both the mayor and Barry, sided with Clarke, as did Democrats Willie J. Hardy, Douglas E. Moore and Wilhelmina J. Rolark and Statehood Party member Hilda Mason.
Siding with Barry were Democrats Arrington Dixon, Polly Shackleton, Nadine P. Winter and John A. Wilson. Republican Jerry A. Moore Jr. and Democrat William R. Spaulding were out of the room.
Four council members voted against final passage of the bill - Hardy, Mason, Rolark and Wilson.
The rise in mortgage interest rates won broad support, with only Clarke voting against the 11 percent figure. He called it a windfall for savings and loan associations.
Before Douglas Moore offered his motion, the council seemed prepared to support Rolark's proposal for a simple extension of the existing temporary law that permits a 10 percent rate.
There was little discussion of the proposal by Rolark that the Pride Environmental Services (PES) bus shelter bill be returned to the council's committee on employment and economic development, which she heads.
A major reason for her request, the Ward 8 council member said, was the decision Monday by PES president Mary Treadwell to change business partners in the project.
"The way I look at it that amounts to bidding (for the franchise)," Rolark said. "If there's going to be some (competitive) bidding going on, it ought to be under the auspices of the government.
The proposed antismoking bill, one of the strongest of its type in the nation, encountered trouble the moment its principal sponsor, Jerry Moore, called it up for action.
Wilson, a smoker, and Barry, a nonsmoker, both warned that a requirement for segregating smokers and nonsmokers in restaurants could drive business away from the city. The bill was tabled when the Council could not agree on a liberalizing amendment offered by Wilson.
Noting that the federal government has called cigarette smoking hazardous, Wilson declared: "You may be wearing a health hazard. You may be married to a health hazard. You may be a health hazard."
The umemployment compensation bill was approved by a vote of 7 to 4, with Dixon, Hardy, Shackleton and Wilson opposed.
The measure had been sent back to Rolark's committee for reconsideration in April after representatives of employers and organized labor disagreed on its terms.
They reached a compromise last week that would curtail but not totally eliminate jobless benefits for workers who quit jobs voluntarily or are fired for gross misconduct. The measure sets new tax rates for employers, who pay the full cost of the program.
The program has been in trouble since it was overdrawn by benefits paid during the recession of the mid 1970s. The city borrowed $67 million from the U.S. Treasury, which must be repaid.
On civilian parking enforcement, the Council adopted both emergency and permanent legislation authorizing the program. Once the measure becomes law, city officials hope Congress will restore $6 million the House D.C. Appropriations Subcommittee has proposed to eliminate from the city's 1979 budget that is needed to pay for operation of the program.
The Council also took similar actions yesterday on a new home loan program for low-income people, hpping Congress will restore $1 million for that program that was similarly cut.