D.C. Mayor's Budget Proposal Would Be First in a Decade to Shrink Spending, and Layoffs Might Be a Result.

Mayor Adrian Fenty delivered his State of the District address at the Hamilton Senior Wellness Center in Northwest D.C. Thursday. Video by Hamil R. Harris/The Washington Post
By David Nakamura
Washington Post Staff Writer
Friday, March 20, 2009

Mayor Adrian M. Fenty's administration will lay off hundreds of employees over the next several months to balance a budget that will shrink for the first time in more than a decade, city officials said yesterday.

Fenty (D) will propose a fiscal 2010 spending plan of $5.3 billion in local funds, a 5 percent decrease from this year's $5.6 billion, said government sources who spoke on condition of anonymity because the budget had not been delivered to the D.C. Council. The decline comes after a shortfall in projected revenue caused by the housing and stock market collapse and marks the first time since 1997 and 1998 that the city's spending will decrease, officials said.

Delivering his annual State of the District address at the Hattie Holmes Senior Wellness Center in Northwest, Fenty pledged that his administration will not sacrifice service delivery despite the spending constraints.

"To keep the District's finances strong, we will continue to make critical choices about how to spend your tax dollars," Fenty said. "These choices won't be easy, and they won't always be popular. . . . Although our 2010 budget will be smaller than last year's, we will take no shortcuts in our commitment to protect the critical city services you expect and deserve, without raising taxes."

After his remarks to the seniors, Fenty declined to reveal details of his budget proposal when pressed by reporters. However, he said that the pain will be spread across city agencies and that a personnel reduction is likely.

"It is impossible to close a budget gap and manage it properly without finding savings in personnel," the mayor said. But he added that "most people know there is still a lot of savings to be found in the District of Columbia government. We are intent on improving service delivery. We have to do more with less."

Last year, Fenty eliminated hundreds of unfilled government jobs. But with that option no longer available, hundreds of employees will be laid off this year, the city government sources said. Some agencies have begun to notify those employees who are affected, while others will begin to do so after the budget proposal becomes public.

The council has the option of making changes in Fenty's budget before it is sent to Congress for final approval in June.

Council members said they had not been briefed on the budget. Member Harry Thomas Jr. (D-Ward 5), who has enjoyed heavy union support, said he has heard rumblings of layoffs and added that he thinks the city should explore other options before putting employees out of work.

"We could have done a lot of things, like furloughs," Thomas said. Layoffs are "inhumane," he added. "I'm fighting for them until the end."

Council member Yvette M. Alexander (D-Ward 7) said she needs more information about which workers will be laid off. Many agencies "are top-heavy" and probably should be reduced among the managerial ranks, she said.

Like most jurisdictions, the District's budget woes have worsened over the past year. Chief Financial Officer Natwar M. Gandhi has announced lower revenue projections for each of the past four quarters. Fenty and the council have patched the previous shortfalls by slashing spending in some areas, including affordable housing and street paving, and taking money from other sources, such as agencies that raise additional revenue by selling services such as regulatory licenses. The council also postponed a Healthy D.C. initiative aimed at providing mandatory health care to most city residents.

Housing advocates have protested the cuts in funds, saying now is the time when the city's poorest residents are most vulnerable. But revenues for the city's affordable housing fund are tied to the property market, a policy decision that advocates had pushed for during the long run-up in prices through most of this decade.

Although Fenty aides declined to discuss the budget, the mayor concluded his address today by saying that his proposal "seeks to preserve and expand affordable housing despite the downturn in the regional housing market."

At the Wellness Center, Fenty's 25-minute address, mostly a laundry list of the administration's accomplishments, was well-received.

"I like the idea that he is increasing education for young people," said Blanche Hamilton of Ward 4. "And I also like his ideas about the policing of the city because we have had a lot of problems."

Staff writers Hamil R. Harris and Nikita Stewart contributed to this report.

© 2009 The Washington Post Company