Mix-Up Muddies Budget Debate

D.C. Finance Chief Backpedals on Plan Submitted by Fenty

The District's top fiscal officer gave conflicting information yesterday about whether Adrian M. Fenty has successfully balanced his first budget as D.C. mayor. Confusion over the $5.4 billion spending plan for fiscal 2007-08 indicated the D.C. Council might dispute portions of the budget, which represents an 8 percent spending increase.

Early in the day, Chief Financial Officer Natwar M. Gandhi acknowledged a revenue shortfall during questioning by council members at a budget hearing. But at the close of business, Gandhi reversed himself, saying the budget is balanced.

Gandhi and Fenty (D) testified during the council's public briefing on the budget yesterday morning. Fenty issued the budget last week, endorsed by Gandhi, whose office is independent of the mayor.

Council members questioned two items yesterday that appeared to show a deficit of about $40 million: an unapproved increase in an emergency 911 fee for telephone users and budget changes at the Office of Contracting and Procurement and the personnel office.

"No. It is not balanced," Gandhi said. "I guarantee you that it will be balanced."

About 5:30 p.m., Gandhi's office sent out a news release that said: "The Mayor's Proposed FY 2008 budget as unveiled on Friday, March 23 is balanced."

Questions during the council meeting "may have created the impression" that Gandhi "does not certify that the Mayor's budget is balanced," the statement said. "That perception must be corrected."

The council is scheduled to vote on the spending plan in May after a series of hearings.

Council member Phil Mendelson (D-At Large), chairman of the Committee on Public Safety and the Judiciary, criticized a provision that more than doubled the charge for telephone users to call 911, from $9.12 to $18.60 annually per line. He noted that the council had not approved the increase, which would generate at least $16 million, which is intended to be used to upgrade technology at the city's Unified Communications Center.

Gandhi apologized. "It should not have been in there, period. I'm deeply sorry that it has happened. . . . It won't happen again," he testified.

Fenty's spending plan would also change the financial structure for the city personnel and procurement agencies, which would not receive direct budget funding. Instead, they would bill other agencies for their services.

Council Chairman Vincent C. Gray (D) said the new budget does not clearly show how the $22 million allocated last year for the agencies would be replaced.

"This isn't just about money. This is about the way government is going to do business," he said.

After Gandhi's testimony, Fenty told council members he was saving millions of dollars in the budget by eliminating "double-counting" of students who leave public schools and switch to charter schools every year.

The D.C. public school system has based budget requests on each prior year's enrollment, and charter schools have used projected enrollment to make requests. That meant that students leaving the public schools and entering charter schools -- many times the same number -- were counted twice.

"Both public and public charter schools will be funded based on estimated enrollment for the coming school year," Fenty said.

Gandhi's office estimated a resulting saving of $25 million.

Staff writer Theola Labb? contributed to this report.