Banner v. U.S.

Decision Date11 March 2004
Docket NumberNo. CIV.A. 03-1587(ESH).,CIV.A. 03-1587(ESH).
PartiesJames M. BANNER, Jr., et al., Plaintiffs, v. UNITED STATES of America, et al., Defendants.
CourtU.S. District Court — District of Columbia

Washington Lawyers' Committee for Civil Rights & Urban Affairs, Walter Smith, D.C. Appleseed Center, Gary Thompson, Gilbert Heintz & Randolph, Washington, DC, for Plaintiffs.

Michael D. Berman, Office of the Attorney General, Baltimore, MD, Rupa Bhattacharyya, Theodore C. Hirt, U.S. Department of Justice, Washington, DC, Maureen R. Matsen, William H. Hurd, Office of Attorney General, Richmond, VA, for Defendants.

Sharon E. Pandak, Ross G. Horton, Prince William, VA, for Amicus Defendants.


HUVELLE, District Judge.

This lawsuit presents yet another chapter in the District of Columbia's longstanding struggle to achieve self-government. The District, its Mayor, its Council and Council members, and eighteen of its residents challenge Congress' refusal to permit taxation of income earned by nonresidents who work within its borders. Plaintiffs contend that the ban constitutes unconstitutional discrimination against residents of the District, who lack the right to vote in Congress. Arguing that commuters in the District should be required to compensate the jurisdiction in which they are employed for the costs they impose, plaintiffs charge that the District's inability to tax nonresidents creates financial deficits not counterbalanced by its federal subsidies, forcing it to impose disproportionately high tax burdens upon its own residents. Amici for plaintiffs argue that the District is the only jurisdiction in the United States denied the benefit of taxing income earned within its borders, and that even the federal government profits from the income earned by foreigners within the nation's borders.1

Plaintiffs' grievances are serious, and their goal is a laudable one. The unfairness of the District's situation is obvious and regrettable. Since the establishment of the District, courts have, however, understood that its unique constitutional position results in unfairness. As early as 1805, then Chief Justice Marshall recognized the inequities compelled by the Constitution as he concluded that the Supreme Court could not grant the District the same benefits enjoyed by the states. See Hepburn & Dundas v. Ellzey, 6 U.S. (2 Cranch) 445, 453, 2 L.Ed. 332 (1805). Chief Justice Marshall's sentiments have been reiterated in subsequent Supreme Court decisions, as well as in rulings from courts in this jurisdiction, all of which have upheld the District's lack of congressional representation. See, e.g., Loughborough v. Blake, 18 U.S. (5 Wheat.) 317, 324-25, 5 L.Ed. 98 (1820) ("Although in theory it might be more congenial to the spirit of our institutions to admit a representative from the district, ... certainly the constitution does not consider their want of a representative in Congress as exempting it from equal taxation."); United States v. Thompson, 452 F.2d 1333, 1341 (D.C.Cir. 1971) ("[F]or residents of the District, the right to vote in congressional elections is ... totally denied. This regrettable situation is the product of historical and legal forces over which this court has no control."); Adams v. Clinton, 90 F.Supp.2d 35, 37 (D.D.C.), aff'd, 531 U.S. 941, 121 S.Ct. 336, 148 L.Ed.2d 270 (2000) ("[T]he dictates of the Constitution and the decisions of the Supreme Court bar us" from granting District residents the "right to elect representatives to the Congress of the United States.").

This Court is likewise mindful of the unfairness of the situation plaintiffs seek to change. But longstanding judicial precedent compels the Court to conclude that plaintiffs do not enjoy the right they seek to obtain. As has been the case for over two hundred years, the residents of this jurisdiction "must plead their cause in other venues," for this Court has no authority to overturn Congress' ban on a commuter tax. Adams, 90 F.Supp.2d at 72.


The District of Columbia is "an exceptional community ... established under the Constitution as the seat of the National Government." District of Columbia v. Murphy, 314 U.S. 441, 452, 62 S.Ct. 303, 86 L.Ed. 329 (1941).2 The Constitution grants to Congress plenary legislative authority over the District: "The Congress shall have the power ... [t]o exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles square) as may, by Cession of particular States, and the Acceptance of Congress, become the Seat of the Government of the United States ...." U.S. Const. art. I, § 8, cl. 17 ("the District Clause").

Until recently, Congress exercised its exclusive control over the District through direct legislation and the appointment of local governors, with only minimal input from residents. See Marijuana Policy Project v. United States, 304 F.3d 82, 83 (D.C.Cir.2002). In 1871, when Washington City, Georgetown, and Washington County were combined to create the District of Columbia, the Organic Act provided for a presidentially-appointed District governor and a legislature with limited power. See Dist. of Columbia v. John R. Thompson Co., 346 U.S. 100, 105, 73 S.Ct. 1007, 97 L.Ed. 1480 (1953); An Act for the Government of the District of Columbia, ch. 62, 16 Stat. 419 (1871). This attempt to provide the District with territorial home rule lasted only a few years, for Congress revoked the self-government provisions of the Organic Act in 1878, and for almost a century the District was governed by a three-person commission appointed by the President. See Adams, 90 F.Supp.2d at 47 n. 19; An Act for the Government of the District of Columbia, and for Other Purposes, ch. 337, 18 Stat. 116 (1874); An Act Providing a Permanent Form of Government for the District of Columbia, ch. 180, 20 Stat. 102 (1878).

Between 1948 and 1966, the Senate passed six different bills granting the District some form of home rule, but each time a similar bill died in the House Committee for the District of Columbia. The commissioner system was replaced in 1967 by a presidentially-appointed mayor and council form of government, see Adams, 90 F.Supp.2d at 47 n. 19; see also Reorganization Plan of 1967, Pub.L. No. 90-623, 81 Stat. 948 (1967), and in 1973, Congress enacted the "Home Rule Act," providing for a mayor and council elected by the citizens of the District. See District of Columbia Self-Government and Governmental Reorganization Act, Pub.L. No. 93-198, 87 Stat. 774 (1973) (codified as amended at D.C.Code Ann. § 1-201.01 et seq.) ("the Act"). The existing local government provides the District with the most expanded form of self-government to date.

The Home Rule Act delegates to the District, of Columbia Council "certain legislative powers," "[s]ubject to the retention of Congress of the ultimate legislative authority over the nation's capital." D.C.Code Ann. § 1-201.02. The Act protects Congress' exclusive legislative authority over the District by providing that Council enactments become law only if Congress declines to pass a joint resolution of disapproval within thirty days (or sixty days in the case of criminal laws) and by reserving the power to repeal Council enactments at any time. See id. §§ 1-206.01, 1-206.02(c)(1)-(c)(2).

The Act also specifically limits the Council's lawmaking powers, enumerating matters that are not "rightful subjects of [Council] legislation." Id. § 1-203.02. The District may not, for example, impose any tax on federal property; it may not regulate federal or local courts, or the Commission on Mental Health; and it may not permit the construction of buildings taller than certain height restrictions. See id. § 1-206.02(a)(1)-(a)(8). Plaintiffs' challenge in this case addresses the Act's commuter tax prohibition (the "Prohibition"), which is among these enumerated limitations: "The Council shall have no authority to ... [i]mpose any tax on the whole or any portion of the personal income, either directly or at the source thereof, of any individual not a resident of the District ...." Id. § 1-206.02(a)(5).

Congress passed the Home Rule Act as a compromise, granting "the people of the District of Columbia an opportunity in exercising their rights once more and yet with adequate safeguards for the Federal interest component." Home Rule for the District of Columbia, 1973-1974: Background and Legislative History of H.R. 9056, H.R. 9682, and Related Bills Culminating in the District of Columbia Self-Government and Governmental Reorganization Act, at 2106 (1974) (statement of Rep. Diggs, reprinted from the Cong. Rec., Oct. 9, 1973). The Chairman of the Committee on the District of Columbia viewed the legislation as "a reasonable and rational accommodation between the interests of all Americans in their Nation's Capital and the basic principle that government should be responsible to the people." Id. at 3052 (statement of Rep. Diggs, reprinted from the Cong. Rec., Dec. 17, 1973).

The Act provided for an annual federal payment to be allotted to the District upon the Mayor's request. To formulate the fund petition, the Mayor was to "prepar[e] an annual budget for the government of the district, ... identify[ing] elements of cost and benefits to the district which result from the unusual role of the district as the Nation's Capital," considering, among other things, the "potential revenues that would be realized if exemptions from district taxes were eliminated," and the "relative tax burden on District residents compared to that of residents in other jurisdictions in the ... metropolitan area and in other cities of comparable size." D.C.Code Ann. §§ 1-205.01(a), (b)(3), (b)(9) (repealed 1997). Thereafter, Congress authorized a maximum annual amount for the appropriation. The federal payment was not to exceed $230 million for the fiscal year...

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