LAST WEEK, a major item for the District's future fell through. Efforts to get Congress to set a formula for the federal government's annual payment to the District government were abandoned. So the yearly, painful tug-of-war between the federal government and the city over the mount of money lost to the local treasury because of the federal government's tax-free buildings on tax-free land in the middle of downtown Washington will continue. bThere is also the loss of money from tax exemptions given groups drawn here by the federal government's presence. And then there is the cost of services provided by the city government to the federal government -- such as policing demonstrators. The city argues that the federal government should reimburse it for that loss of money. On the other hand, some members of Congress argue, the federal presence provides a divident of tourists, museums, parks and jobs for the city, which offsets some loss of tax dollars.
So there comes the question of how much the federal government should pay the city annually in lieu of taxes. And every year the debate roars on, making obvious the need for some set formula will end the shouting and give the city a fair amount of money. Such a formula would also enable the city to set its finances straight. As things are done now, the city never knows how much the federal government will appropriate until the last moment. For example, the size of the payment for the 1981 fiscal year, beginning Oct. f1, has not yet been decided, although the District had to draw up a budget for 1981 spending over a year ago.
Despite that history, all congressional efforts to set a formula for the payment have been forced off track for this year. The consensus in Congress is that this is not the year for it. Why not? Because, the answer goes, the city's current fiscal problems and the presidential election make it a bad year for arranging a procedure for the payment.
This is shortsighted. From Congress' point of view, a formula would free it from this perennial problem once and for all. And the lack of a formula is aggravating to the City's financial problems, since the city government cannot do a good job of planning its spending when it doesn't know how much money it will get from the federal government. Congress and the White House both have a stake in the future of this city. And both have an interest in not acting irresponsibly in ways that could propel the nation's capital into bankruptcy.