The District will collect $190 million more in revenue this fiscal year than previously anticipated, Chief Financial Officer Natwar M. Gandhi said Friday.
The 3.2 percent upgrade pushes the 2013 estimate for locally sourced general fund revenue to $6.06 billion, but that still represents a drop from last year’s windfall of $6.39 billion. Revenue for fiscal 2014 — a budget for which will soon be proposed by the mayor and passed by the D.C. Council — is estimated to tick up $177.8 million, to $6.13 billion.
In a letter to city leaders, Gandhi cited the ongoing uncertainty over the federal budget as an ongoing damper to his fiscal exuberance: “This revenue estimate assumes that some significant measures to reduce federal spending will be enacted in the near future,” he wrote, specifically contemplating the across-the-board “sequestration” cuts set to take effect March 1.
While the previous year’s $417 million surplus was overwhelming evidence of a District economy that continues to boom despite the questions about the nation’s fiscal path, Gandhi said he believes the party is not likely to continue: “At 1.5% and 1.3%, respectively, revenue growth for FY 2013 and FY 2014 is expected to be much slower than in FY 2012, when it grew by 10.6%. A large part of the reason for slower growth is the combination of federal austerity and slower employment growth.”
Modest as it might be, the growth gives Mayor Vincent C. Gray and the D.C. Council its most significant pot of new revenue since at least 2008. In his State of the District address earlier this month, Gray committed to spending $100 million in new current-year revenue on affordable housing, plus another $15 million on competitive grants to nonprofit groups and an unspecified amount on city employee raises.
That money would have to be spent before the fiscal year ends on Sept. 30, but it can’t be spent until Gray drafts a supplemental budget request and submits it to the D.C. Council for approval (and likely modification).
Gray spokesman Pedro Ribeiro said Gandhi’s new estimate is in keeping with the administration’s internal projections. “We think $190 million is pretty good,” he said.A supplemental budget request, he added, will come sometime in March.
The new estimates could be the end of a quarterly ritual for Gandhi, who announced earlier this month that he will step down on June 1 from the post he’s held since 2000. The next round of projections are due in late June.