Federal Cuts in D.C. Budget Mean 'Sacrifices' and Higher Taxes
||Washington Times (DC)
||Sunday, February 20, 2011
With the House proposing to cut more than $80 million in spending on D.C. programs for the current fiscal year, City Hall is preparing District residents for the pain.
Mayor Vincent C. Gray said residents should brace for “sacrifices,” and D.C. Council member Michael Brown said Sunday higher taxes would come in the form of legislation that his colleagues and the mayor will be “comfortable with.”
Their comments over the weekend followed House passage of a continuing resolution for fiscal 2011 that would cut more that $61 billion from last year’s federal spending. For the District that means potential cuts to key D.C. programs, including public transportation ($150 million), courts ($25.5 million) education ($15.4 million), and water and sewer ($10 million).
The legislation would spare some D.C.-specific programs, including the D.C. Tuition Assistance Grant program, a subsidy that pays the difference in tuition costs for D.C. students who attend out-of-state colleges and universities.
The House bill also continues funding for the U.S. Department of Homeland Security-St. Elizabeths Hospital project, of which Delegate Eleanor Holmes Norton, D.C. Democrat, is a key proponent.
But Mrs. Norton is critical of the House bill, passed on party lines on a 235-189 vote in the wee hours of Saturday morning, as being antidemocratic for reinstituting a ban on the D.C.-funded needle exchange program and for breathing new life into a federally funded school voucher plan.
Mrs. Norton also said she is holding out hope that the Senate, which returns to Washington next week and holds a slim Democratic majority, will look more favorably upon allowing the city to spend its tax dollars as D.C. residents see fit.
The legislation “is replete with substantial cuts to the small domestic part of the U.S. budget that the average American relies on,” Mrs. Norton said Saturday afternoon. “The House bill is only the first round in the [continuing-resolution] process. I have been rounding up Senate allies who, along with the Obama administration, are committed to preserving D.C.’s home-rule rights and dignity as a local jurisdiction.”
The mayor and Mr. Brown said they will take a pragmatic approach as the city tries to reconcile the loss of federal funds with a looming deficit in its own fiscal 2012 budget.
Mr. Gray, whose office issued a statement just prior to midnight Saturday, called the proposed $80 million in federal cuts “devastating” and “another serious blow to the District’s precarious financial situation,” and that the cuts “probably will result in the elimination of key services for residents of the District.”
The twin challenges mean looking at ways to raise additional revenue and sacrifices in all sectors of the city, Mr. Gray said.
“All of us will have to make sacrifices to get through this as one city. Despite this painful situation, I am optimistic we will be stronger for it,” the mayor said.
On Sunday morning, Mr. Brown, an independent and the leading voice of tax increases in City Hall, said in an interview with The Washington Times that cutting spending on social services and shrinking government are top priorities, and that raising taxes is “a last resort.”
In recent years, the District has entertained several ways to increase tax revenue, including so-called “jock” and “millionaires” taxes, but the proposals never made it into law.
The current climate — with a projected deficit and federal cuts — is different because the mayor said he promised bond-rating agencies at a Feb. 10 meeting in New York that he and other city leaders were committed to stabilizing the city’s budget with new revenue rather than by spending reserve funds.
Mr. Brown, who did not attend the New York meetings, said tax-increase measures are being written and that he wants to protect the poor and working-class families.
“We have to put together legislation in the coming weeks that the mayor and my colleagues are comfortable with,” he said.
“We have people who want to be in an urban environment and pay for it. I want to avoid hurting working families. We can’t have a [new tax rate] threshold so low they get hurt.”