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Posted at 11:07 AM ET, 10/28/2010

Tommy Wells, advocates push for tax increase

D.C. Council member Tommy Wells (D-Ward 6) said Wednesday night that he will not accept any cuts to the city's social services budget unless it is accompanied by a tax increase, perhaps even on wage-earners who make less than $100,000 a year.

Wells, chairman of the Human Services Committee, made his remarks at a news conference where almost 70 organizations announced that they will push to set a new tax rate for residents who earn more than $200,000 a year.

"I will not accept any budget cut to the human services cluster without raising revenue, taxes," Wells said. When a reporter asked him if he'd support a tax increase on middle-class residents, Wells responded, "I don't believe anything should be off the table."

"I will look at all income levels and I am not starting off with one proposal," said Wells, who faces Republican Jim DeMartino in the Nov. 2 general election.

The Fair Budget Coalition, made up of 67 local nonprofit and advocacy groups, released a proposal to set a new income tax rate for residents who make more than $200,000. Currently, all District residents who earn $40,000 or more pay an 8.5 percent local income tax.

But with the city facing a budget shortfall of at least $175 million, advocates are pressing city leaders to raise additional revenue instead of closing the gap through spending cuts alone.

"Another round of deep cuts puts at risk the gains we've made in education, public safety, health care and human services," said Judith Sandalow, executive director of the Children's Law Center. "The potential impact on schools, libraries and other vital programs jeopardize the District's ability to recover and to invest in a prosperous future."

In addition to a tax hike on the wealthy, the coalition is also pushing to end the tax exemption for interest paid on out-of-state bonds.

Dwight R. Bowman, national vice president of the American Federation of Government Employees, said organized labor was also backing a tax increase to close the budget shortfall. But when asked if AFGE would accept a deal in which a tax increase was coupled with layoffs or furloughs of city employees, Bowman suggested that that would hurt the local economy.

"It is my position we want to save jobs," Bowman said. "You have to realize our people just don't work in the District of Columbia, they live in the District of Columbia."

The battle over taxes and budget cuts will probably land before council Chairman Vincent C. Gray (D), the presumptive mayor, before the end of the year.

A tax increase could further erode Gray's standing among wealthy residents in Upper Northwest, who overwhelmingly sided with Mayor Adrian M. Fenty (D) in the Sept. 14 Democratic primary. But Gray is also under pressure from organized labor and social advocates, who were among his biggest backers during the campaign, to avoid major budget cuts to human service programs.

So far, Gray is avoiding taking a firm stance. At his final town hall meeting Wednesday night, Gray said he and the council would compile a list of potential budget cuts and then seek public input about whether taxes should be raised instead.

"I don't mind paying more, I'm okay with that," Gray said. "But I don't think everyone else is."

By  |  11:07 AM ET, 10/28/2010

Categories:  2010 District Election, 2010 District Election

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