D.C.'s crash-and-burn budget

Friday, May 28, 2010

COBBLING together a budget for next year, D.C. Council members largely avoided hard choices. Instead of slowing spending, they opted to borrow more money, extend the reach of the sales tax and engage in some wishful thinking about taxing nonresident city government workers. All in all, it was a depressing exercise of election-year politics trumping the city's best financial interests.

The council gave preliminary approval Wednesday to a $5.3 billion, 2011 spending plan that leaves untouched Mayor Adrian M. Fenty's plan to draw down the city's reserves. To restore some spending cuts made by Mr. Fenty as well as fund its healthy-school-lunch initiative, the council decided to tax sugary soft drinks and medical marijuana, borrow more money and restructure some of its debt. Approval was near unanimous, with only council member Jack Evans (D-Ward 2) dissenting.

It was the first time in his 19 years on the council that Mr. Evans, the knowledgeable chair of the revenue and finance committee, voted against a budget. He told us that he regrets not opposing some of the fanciful budgets that sank the city in the 1990s, eventually forcing Congress to seize control of city finances; this time around he is objecting as the city again heads irresponsibly toward dangerous territory. Wall Street is already worried that the city has reduced its reserves from a high of $1.58 billion in 2005 to the current $920 million, with plans to further draw them down to $607 million in fiscal 2012.

But neither Mr. Fenty, who is running for reelection, nor council Chairman Vincent C. Gray (D), who is challenging him for mayor, showed any appetite for reining in spending or discussing tax increases. Neither official has distinguished himself. Mr. Fenty submitted a flawed spending plan; Mr. Gray made it marginally worse, while his gyrations on streetcar funding undermined confidence in the council's decision-making. The best idea the council could come up with to build up its reserves was to impose a form of a commuter tax on D.C. government workers from outside the city. That sounds great -- other cities impose such a tax -- but there's no way Maryland and Virginia representatives in Congress will allow it to happen, as council members must know. Voters also are entitled to question the wisdom of starting programs, no matter how worthwhile, when there's not enough money to sustain existing services.

It's inevitable, as Mr. Evans told his colleagues, that they -- or whichever of them are still around after this year's election -- will have to confront the city's fiscal problems. In postponing that task, they only make it more difficult.

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