7. The present Federal admissions-tax law has a number of inequities. Some of these are:

(a) School districts which operate recreation programs are exempt from collecting Federal admission taxes under section 701 (a). Thus, a school district may conduct a teen-age dance as a part of its community recreation program without paying a tax. An adjoining community where the recreation program is under municipal direction has no such exemption and must pay the tax.

(b) School districts which operate recreation programs and include community athletic leagues as a part of that program are exempt from collecting admission tax. An adjacent community where the municipality operates community athletic leagues as a part of the recreation program must collect the tax.

(c) Symphony orchestras are exempt but community bands and choral groups are not.

(d) Admission charges for swimming at a municipal swimming pool are tax exempt, square dancing at a municipal recreation center is not. In order to correct the inequities which we believe exist in the present law we request that the committee consider amending section 1701 (a) (1) by adding a subsection (vi) along the following lines: "A State or political subdivision thereof or the United States or any agency or instrumentality thereof in respect to recreation facilities and activities operated and/or conducted by them."

We also request that the committee consider amending section 1701 (2) (1) by inserting before "to the benefit of an elementary or secondary school * * *" the words "to the benefit of a State or political subdivision thereof or the United States or any agency or instrumentality thereof or

Hon. DANIEL A. REED,

DEPARTMENT OF THE INTERIOR,

NATIONAL PARK SERVICE, NATIONAL CAPITAL PARKS, Washington 25, D. C., July 31, 1953.

Chairman, Committee on Ways and Means,

House of Representatives, Washington 25, D. C.

MY DEAR MR. CHAIRMAN: As chairman of the legislative committee of the American Institute of Park Executives, I strongly endorse the recommendation submitted to the House Ways and Means Committee for the amendment of the Revenue Act of 1951 (Public Law 183, 82d Cong.), section 1701, as follows:

(a) (1) by adding a subsection (vi) along the following lines: "A State or political subdivision thereof or the United States or any agency or instrumentality thereof in respect to recreation facilities and activities operated and/or conducted by them."

(2) (1) by inserting before "to the benefit of an elementary or secondary school ***" the words: "to the benefit of a State or political subdivision thereof or the United States or any agency or instrumentality thereof or

From statements which have been submitted to me by park and recreation directors in all parts of the United States, I can assure you that the adoption of the above-suggested amendments would meet with the approval of public recreation authorities everywhere. I feel that the benefits that would derive to the public, and particularly to children participating in active recreation so essential to their welfare and so important in combating juvenile delinquency, would be in the public interest and would result in actual economies not only in the cost of National Government but also city, State, and county governments.

I would greatly appreciate your courtesy in including this statement in the record of the hearings now being conducted by the House Ways and Means Committee on the amendment of Public Law 183, 82d Congress.

Sincerely yours,

EDWARD J. KELLY, Superintendent.

Mr. RUSSELL E. TRAIN,

THE NATIONAL CONFERENCE ON STATE PARKS, INC.,
Columbus, Ohio, Augst 18, 1953.

Clerk, Ways and Means Committee,

House of Representatives, Washington, D. C.

DEAR MR. TRAIN: Mr. Joseph Prendergast, executive director of the National Recreational Association, 315 Fourth Avenue, New York, N. Y., advises that his association has requested your committee to consider certain suggested amendments to the Internal Revenue Code regarding the Federal admissions tax. Specifically, they suggest

Amending section 1701 (2) (1) by adding a subsection (vi) along the following lines: "A State or political subdivision thereof or the United States or any agency or instrumentality thereof in respect to recreation facilities and activities operated and/or conducted by them."

Amending section 1701 (2) (1) by inserting before "to the benefit of an elementary or secondary school *** the words "to the benefit of a State or political subdivision thereof or the United States or any agency or instrumentality thereof or ***."

The National Conference of State Parks endorses these suggested amendments.

The conference is an organization composed of professional and lay persons interested in State parks. The purposes and objectives of the organization are to inform the public concerning the value of State parks, historic sites, forests, and preserves suitable for recreation, and to encourage development of wellbalanced State park systems to the end that every citizen in the United States shall have easy access to State recreation areas and appreciate their value. The conference also encourages the development of long-range State park programs, including the formulation of standards for selection, development, and administration.

The application of the admissions tax to parks has been discussed by the board of directors of the conference on various occasions. At its February meeting the board adopted a motion to request the Congress to remove the Federal tax on admissions imposed by the United States, the States, or any political subdivision, in connection with the operation by them of parks, museums, historic sites, caves, recreation areas, and other recreation activities and facilities. Favorable consideration of this request and inclusion of this letter in the record will be greatly appreciated.

Sincerely yours,

V. W. FLICKINGER, President.

DIGEST OF STATEMENTS BY RECREATION EXECUTIVES ON FEDERAL ADMISSIONS TAX "No taxes should be collected if the entire proceeds from spectator tickets are going into the recreation fund for use by the recreation department."-James M. Spain, Florence Park and Recreation Board, Florence, Ala.

"Exemption should be granted in all cases where activity is wholly supported by tax revenues, whether participant or spectator, on the principle of no private gain or increment."--Dewey R. Kruckeberg, Director, Park and Recreation Department, Burbank, Calif.

"The small communities are concerned about support of many recreation department functions through the general tax levy. It has been generally felt that participants should carry part of the load directly through charges, fees, and admissions. The burden of taxes on the property owners with maximum limits being supplemented with school, hospital, and other bond issues have caused them to take a dim outlook on recreation if the services are offered free to other than children or handicapped groups. The recreation departments are then faced with revenue problems supplemented with tax charges, or with the organization of nonprofit clubs which may get clearance from the tax office. Such clearances are strictly for club memberships and one can readily see that is not healthy for a board recreation program. We try to base out programs and wide participation and service to the entire community."-E. L. Lincoln, Superintendent of Recreation, Burlingame, Calif.

"Most recreation departments operate on close budgets and it is therefore necessary to make some of the activities self-supporting, such as basketball leagues, teen-age clubs, dances, shows, etc. None of the above activities are money-making projects, admission to them just help to defray the cost of conducting such a program. Many of our activities that brought in small amounts

of revenue have had to be discontinued because these admission taxes are a nuisance, requiring the filling out of forms, notary-public signature, and elaborate bookkeeping."-T. R. Grant, Director, Recreation Department, Lompoc, Calif. "It is my opinion that all public recreational departmental programs for which admissions are charged should be exempt where such admissions are used to defray legitimate expenditures of the department involved. It is my feeling that exemption should not be limited to participation activities, but should be applied on spectator admissions as well."-Jay M. Ver Lee, Recreation Department, Oakland, Calif.

"Dramatic, music, athletic, and social events conducted by the department, or nonprofit department-sponsored agencies should be exempt from Federal admissions taxes. Admissions charged for these events are used to assist in covering the expenses of the activity which is an integral part of the overall city city recreational program supported by municipal taxes."-Leo B. Calland, Park and Recreation Director, San Diego, Calif.

"We have been informed by our State director of internal revenue that our small 25-cent membership fee to our teen group is subject to tax."-William Rooney, Superintendent, Park, Playground, and Recreation Commission, San Luis Obispo, Calif.

"We operate a 40-team adult softball league throughout the summer, 5 nights a week on a 20-cent admission from which our own city and the Federal Government take 25 percent. We can handle the city tax if we can get away from the Federal tax. This operation almost pays its way. If we could get rid of this Federal tax we could make it pay. We have a similar situation where single benefit games are put on for the purpose of raising money to buy suits and other equipment to make up for situations where we are unable to secure enough merchant sponsors. We have a number of goodhearted people who will go along but not a sufficient number to sponsor the big community program we want to develop. We are not in business to make money but only to develop pay-as-you-go recreation to offset our local taxpayer charge, that it is costing them too much, hence I call these nuisance taxes-they cramp our style."-B. E. Swenson, Dean of Recreation, Recreation Department, Stockton, Calif.

"I have always felt that when a creation or park department, which is totally or partially financed by taxes and has to depend upon a portion of its program for the small revenue it collects, and if such agency is strictly a service-type department or district as ours is, that no tax should be leveled. In the case of the tax which was removed from swim pools, it means that we were able to drop our costs for 5 and 7 cents per participant to 0.013 cent per participant. This results in less cost to the district and puts some activities on a paying or at cost basis."-Keith A. Macdonald, Executive Director, Greater Vallejo Recreation District, Vallejo, Calif.

"Any facilities, owned or leased by public agencies should be exempted from Federal admission taxes when operated as a service to the community on a nonprofit basis. In many smaller communities such activities as youth dances, community dances, etc., will have to be abandoned due to the fact that operating expenses, that is, band, decorations, and ticket printing, exceeds the gross. Charges and/or taxes should not be raised due to the economic situation in most of the homes."-Thor O. Olson, Superintendent of Recreation, Ventura County, Calif.

"We in Denver feel that the Federal tax should be removed from movies of an educational nature at our recreation centers because locally we have cleared with theater owners and supply this service without competition. We believe it should be removed for the cost for folk and square dancing which again seems an educational approach and not in competition with public dances."-J. Earl Schlupp, Director of Recreation, Denver, Col.

"It has always been my feeling that for activities such as dances, swimming, and any other activity sponsored by a municipal organization or a nonprofit incorporated organization should not be taxed."-George T. Sargisson, Executive Director, Recreation Promotion & Service, Inc., Wilmington, Del.

"Receipts from our activities are placed in a revolving trust fund which is used to further our program activities but unlike other cities these receipts, when deposited in the trust fund, become Federal money because they go directly into the United States Treasury-to our credit. Thus, the Federal Government in effect is taxing itself when it requires us to levy admission or use taxes. In addition, moneys for recreation purposes are appropriated by the Congress of the United States from local taxes, on recommendation of the District of Columbia Commissioners. Therefore, our citizens are paying a Federal

tax on a nonprofit venture which was originally paid for out of Federal taxes which they previously paid. It is a form of double taxation. We see no reason to pay admission or public use taxes on any of our activities. Further, there is confusion regarding a spectator or an active participant. They are both seeking, in varying degrees, wholesome use of their leisure time."-Milo F. Christiansen, Superintendent of Recreation, Recreation Department, Washington, D. C.

"All recreation activities sponsored and operated by municipalities should he exempt from Federal Taxes."-Thomas Starling, Administrator, Orlando Recreation Department, Orlando, Fla.

"Included in an overall program of municipal recreation departments there are many instances where programs such as May Day festivals, Christmas festivals, Children's Gasporilla festivals, talent shows, and many others are presented not as a money making project but where it is necessary to charge admission in order to defray the cost of such programs which cannot be borne from tax funds. I believe that were it possible to have such activities tax exempt it would be most helpful. To give you a definite illustration we have just completed our Children's Gasparilla festival in which the ticket sale amounted to about $750. The tax for that particular activity amounted to approximately $160 and our expenses were a little over $600. Had it not been necessary for us to pay the tax it would have been possible for us to make the festival more elaborate and also create a fund for the promotion of such activity in the future. This is also true of our May Day festival and other activities."-Cordelia B. Hunt, Superintendent, Board of Public Recreation, Tampa, Fla.

"All these publicly owned and operated facilities are nonprofit, and have been built and are operated with public money; it seems unreasonable and unfair that patrons should be taxed again to use the facilities that their taxes have made possible."-Mrs. Steve Magargee, Director, Decatur Recreation Department, Decatur, Ga.

"I do not think it just to charge the public twice for an activity. Publicowned or nonprofit recreational facilities are provided for use of the citizens of all cities in the country. The freedom of use and in many cases the inability to pay may restrict the play and enjoyment of those whose need of such activity would help to provide a happier and fuller existence."-John A. Lippold, Director, Playground and Recreation Department, Aurora, Ill.

"The tax is a nuisance more than a source of income. Some of the charges are small and the resulting revenue to the Federal Government is nil. I would not be surprised if many ignored it in the long run."-Charles T. Byrnes, Superintendent, Bureau of Recreation, Evanston, Ill.

"It is my theory that any governmental agency functioning under a political subdivision should not have to pay any form of Federal or State taxes. This comes under the old saying of 'Robbing Peter to pay Paul.' This includes participation and nonparticipation admission taxes. Anyone having the benefit of, and the power to tax comes under the category of nonprofit enterprises. We do not benefit any group or individuals financially, and are lawfully obligated to do things that private enterprises cannot profitably accomplish."-Ralph B. Birks, Superintendent, Playground and Recreation Board, Moline, Ill.

"I am strongly in favor of removing all taxes from any operations of a recreation department. I think this is double taxation, which is unwarranted."Bevier Butts, Recreation Director, Playground and Recreation Board, Waukegan, Ill.

"It is my belief that where the performance of a public service is a definite function of a municipality, assigned to it by State statute, there should be no Federal admissions tax imposed."-Gordon B. Wallace, Superintendent of Parks, the Wilmette Park District, Wilmette, Ill.

"In the past several years we have been compelled to collect Federal admissions taxes on daily and season privilege fees charged for the use of our bathing beaches and outdoor skating rinks, this despite the fact that all of these facilities are operated by the Winnetka Park Distrct, a municipal corporation under the laws of the State or Illinois. All of the revenue derived from the charges made was used to support the activity, and further, the revenue derived from the sales of these season privilege and daily fees paid only a part of the total cost of operation, the balance being paid from general taxes levied for the purpose. We were very much gratified when these taxes were repealed last year and have secured exemptions from this tax on our beaches and skating rink activities, in view of the fact that our operations came within the provisions of the act. It is the feeling of the writer that all park districts and recreational activities

sponsored by a tax supported organization should be exempt as per the letter of the present law when the income derived is used to support the recreational or park district activity, or is channeled back into the operating funds of the sponsoring organization. It is the feeling of the writer that it should apply to any recreational activity sponsored by a public agency, whether it be ice skating rinks, bathing beaches, swimming pools, or bowling alleys, and pool and billiard tables, or spectator admissions charged for the recreation event."-George B. Caskey, Secretary-Superintendent, Winnetka Park District, Winnetka, Ill. "It is our opinion that all public tax-supported agencies should be exempt from paying Federal admissions taxes for participation activities such as in the use of swimming pools, beaches, golf courses, dances, bowling alleys, pool and billiard tables, ball games, tennis, etc. Also, we feel that spectator admissions should be exempt from these taxes."-Martin M. Nading, Jr., Executive Secretary, Indiana Park and Recreation Association, Fort Wayne, Ind.

"Any activity sponsored by recreation department, such as teen centers, ball games, etc., sponsored and conducted by municipal departments should definitely be exempted."-Albert A. Domingue, Superintendent, Playground and Park Commission, Lafayette, La.

"Federal recreation taxes impose a heardship on public recreation agencies such as our local commission due to the fact that admission charges are our only source of income in addition to the tax levy."-Willis C. Winters, Superintendent, Recreation Commission, Lafourche Parish Recreation Commission, Thibodaux, La.

"Since municipal recreation activities are conducted as a service to the people and are paid for out of taxes, it seems reasonable that no tax on admissions should be charged. Fees from recreation activities seldom pay the total cost and when they do such receipts are used for the expansion of other activities. The primary purpose is service and not profit."-Forest V. Gustafson, Director of Recreation, Montgomery County, Md., Rockville, Md.

"Tax exemptions should be given on spectator admissions in cases where the activity is conducted by a duly constituted public authority such as school, park, or recreation board or department as well as on swimming pools, beaches, golf course, etc., when operated by such authority."-Lorne C. Rickert, Superintendent of Recreation, Recreation Commission, Salisbury, Md.

"After the change in the law regarding admission taxes in November 1951, the Norwood Recreation Department requested an interpretation from the Internal Revenue Bureau relative to payment of admission taxes on token admissions charged young people at dances conducted under the sponsorship of the Department, the proceeds of which went to the treasury of the municipality itself. It was the ruling of the Bureau (after 6 months) that such affairs were not properly considered as physical exercise and therefore were not exempt from the tax. We have continued to pay this tax. It would seem that dances and other forms of social recreation conducted by a public department such as this should be exempt from payment of the admission taxes."-Richard E. Ready, Superintendent of Recreation, Norwood, Mass.

"If the revenue goes directly into the city recreation budget and can be used for the support of the total recreation program including playgrounds, etc., then no Federal admission tax should be levied."-Art Genter, Director of Recreation, Howell, Mich.

"Early in February of 1952 I filed a brief with the office of collector of internal revenue at Detroit, stating among other things that due to the loose wording of the act we consider our recreation department teen-age dances, held in our schools, a facility for physical exercise within the meaning and intent of the law. Further, that a dance, or an activity, supported by the city school system, the community chest, and city funds jointly, for the purpose of providing wholesome entertainment for youngsters to help curb juvenile delinquency is definitely a charitable enterprise and that inasmuch as these dances are not for profit and are only partly self-supporting that they should be tax exempt within the intention of the act. The Detroit office did not approve nor entirely reject my proposals and advised me to send the brief on to Washington, which I did. I never received a reply. I definitely feel that all admissions to a public recreation activity should be abolished as well as admissions to a swimming pool, etc. The rule should be general and not specific. Why should our theaterguild productions be taxed when our symphony orchestra is not taxed? It is basically unfair."-Everette R. Scherich, Superintendent, Jackson Recreation Department, Jackson, Mich.