The D.C. City Council voted yesterday to table legislation that would have allowed mergers and acquisitions between banks in the District and those in an 11-state region.
Charlene Drew Jarvis (D-Ward 4), chairman of the Housing and Economic Development Committee and chief sponsor, said she asked that the bill be withdrawn because of 11th-hour phone calls she received from bankers objecting to the absence of the so-called "trigger" provision in the bill.
The trigger provision, which is supported by Mayor Marion Barry, would open up the District to mergers with banks nationwide after two years.
The council, in its final legislative session before summer recess, also:
*Approved the creation of a new commercial property tax classification that would reduce the tax burden on the District's hotels, motels and inns.
*Approved a youth offenders bill that establishes special treatment and incarceration programs for those between the ages of 18 and 22 who are convicted of felonies. Only murderers would be exempted from the program.
The council had given preliminary approval to the banking measure two weeks ago, but Jarvis said she decided to pull the bill after receiving calls from some area bankers early yesterday indicating they were opposed to the bill without a trigger provision. Jarvis said she feared that the bankers had contacted other council members and that the bill might fail if it were brought to a final vote. She did not identify the bankers who called her.
However, Michael F. Ryan, president of the D.C. Bankers Association, said his group has not wavered in its support of the Jarvis bill and he doesn't know who called Jarvis.
"The position of the bankers has been and remains that we are not in favor of a trigger provision," Ryan said. "We are disappointed that the bill was tabled."
Pauline Schneider, the District's director of intergovernmental relations, said that Mayor Marion Barry, in addition to favoring a two-year trigger, also wants to establish an office within the executive branch to review banking matters under an interstate banking law. The Jarvis bill gives that oversight responsibility to the council.
"He Barry was prepared to veto" the bill, Schneider said.
In the property tax action, the council created a special property tax rate for hotels of $1.82 for each $100 of assessed value, 21 cents lower than the $2.03 commercial property rate under which hotels formerly were taxed.
Council member John Ray (D-At Large), who voted against the bill, said he does not favor placing hotels in a special category because their owners had not demonstrated that they were suffering financially.
Barry, who proposed the tax rate change in mid-June, has said the new tax class is necessary because assessment increases for hotels have been 22 percent to 38 percent in the last two years compared to increases of 10.7 percent to 23.2 percent for other commercial property.
Leonard Hickman, executive vice president of the Hotel Association of Washington, D.C., said his organization is "very pleased" with the tax change, which goes into effect immediately. He said hotels collect $64 million annually in sales taxes for the city.
In giving final approval to the Youth Rehabilitation Act, introduced by council member Wilhelmina J. Rolark (D-Ward 8), the council rejected numerous amendments that would have exempted, in addition to murderers, offenders who commit the crimes of rape, drug dealing, robbery, kidnaping, burglary and others.
The bill gives judges options in sentencing youthful offenders and calls for segregating them from the general prison population and providing them with counseling, educational instruction and job training.
Council member Carol Schwartz (R-At Large), who voted against the bill, said it does not reflect the get-tough public opinion in the District. "To those who commit crime, we would send a message of indulgent weakness," she said.
Joseph diGenova, U.S. attorney for the District, criticized passage of the bill yesterday "at a time when the public and law enforcement officials are rightfully concerned about drug trafficking as well as violent and dangerous crimes."