D.C. COUNCIL

Budget Vote Delayed by Questions On Revenue

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By Nikita Stewart
Washington Post Staff Writer
Saturday, October 18, 2008

The D.C. Council will delay a vote on Mayor Adrian M. Fenty's proposal to close an estimated $131 million budget gap because the city's chief financial officer says he cannot certify projected revenue in the plan that would cover $20 million of the shortfall.

After a daylong hearing yesterday during which council members questioned Chief Financial Officer Natwar M. Gandhi and City Administrator Dan Tangherlini about the budget gap, Council Chairman Vincent C. Gray (D) postponed a Tuesday council vote on Fenty's proposal.

"As soon as I receive additional information that gives us a better understanding of the executive's proposal, then I will immediately establish a timeline for the review and approval of a gap-closing plan," Gray said in a memo sent to council members shortly after 6 p.m.

The postponement continues the latest battle between the mayor and the council, which started last week when Fenty was slow to give the legislative branch his proposal. Some council members had complained that the proposal lacked details -- a grievance that clearly frustrated Tangherlini during the hearing.

He noted that the administration had answered council questions in an 85-page document crafted over the Columbus Day weekend. The document was more detailed than a plan that addressed a budget shortfall of more than $300 million for fiscal year 2003, he said.

"I think we've done it for the council at a level it has never been done before," Tangherlini said in an interview.

But Phil Mendelson (D-At Large) said he was still missing information, such as why the administration decided not to purchase radios for the Office of Unified Communications, which handles 911 and 311 calls. "I don't know what it means," he said, saying he needs to understand "the programmatic impact."

Other council members also disagreed with some of the proposed reductions. For example, Tommy Wells (D-Ward 6) said he did not understand why Fenty was proposing to slash more than $1 million from the Child and Family Services Agency, which has struggled this year with an increase in cases in the wake of high-profile child deaths. "That's just not an area that we can cut," he said. Child welfare advocates who testified agreed with his assessment.

In an interview, Tangherlini said the council should "be very careful about going through the list."

Under Fenty's proposal, nearly $60 million would be cut from the budget, and an additional $71 million would come from "revenue enhancements." The enhancements include $48 million that would be created by taking unspent balances from so-called O-type accounts, which contain funds generated from business licenses, permits and fees and are earmarked for specific uses. The money could be transferred to the operating budget through legislation.

Fenty also recommended that the city save about $31 million by eliminating vacant positions and $10 million from delaying an investment into an employee retirement benefits fund.

In fiscal 2010, the administration is looking at a 5.5 percent reduction across all agencies.

Gandhi, however, provided a chart to the council showing that $1.8 million of the O-type funds and an additional $17 million in revenue cannot be certified until a comprehensive annual financial report has been completed.

Although Gandhi projected the $131 million fiscal 2009 shortfall last month, council members are concerned that the projection may be too low, given the country's economic instability.

Council member David A. Catania (I-At Large) said he did not trust Gandhi's estimate because it was based on data available "well before the floor dropped out of our stock market."

"To believe this analysis, I think, we do it at our own peril," he said.


© 2008 The Washington Post Company

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