Though by law it is required to have a balanced budget, the District of Columbia's fiscal obligations exceeded the city's revenues by $61.8 million at the end of the past fiscal year, the D.C.Municipal Research Bureau reported yesterday.
The nonprofit organizations said that increasingly large operating deficits at the end of the last four fiscal years left the District government on June 30 with "an accumulated operating fund deficit of $118.8 million."
This means that even though the District's budget demands that expenditures not exceed revenues and that no more is spent by the city within a fiscal year than is actually received, the District has accumulated a larger and larger pile of unpaid bills at the end of each recent fiscal year.
In issuing a warning abouta the District's finances, the research bureau said that of the nation's 30 largest cities, only three other cities besides Washington - New York, Buffalo and Philadelphia - had a history of a growing accumulation of annual deficits.
"The are hopeful signs that budget imbalances will be reduced or eliminated during fiscal 1977 and 1978," the bureau's report said.
The bureau concluded, "The condition of the District's finances at the end of fiscal 1976 left little to cheer about . . . The real test that remains is whether a truly balanced budget for the city can be achieved over the longer term by making hard choices to reduce expenditures or increase taxes. There will be no easy solutions."
District budget director Comer S. Coppie said yesterday teh research bureau's report is overly negative because it does not consider the District's financial position at he end of the budget quarter ending Sept. 30 when expenditure obligations exceeded city revenues by only $27 million, not the $61.8 million of June 30.
Philip M.Dearborn, executive director of the bureau, said the city has not released its final financial figures for the transitional budget quarter ending Sept. 30, so those figures were not available to the bureau. Those for the end of fiscal 1976 are the latest available, he said.
The bureau's report said that of the nation's 30 largest cities, only 12 others besided Washington had expenditures exceeding revenues in their most recently reported fiscal years.
Five of these cities (Pittsburgh, New York, Buffalo, Columbus and Seattle) had greater proportional deficits than the District, but only New York was further behind in total dollars, the report said.
The District's $61.8 million excess of expenditure obligations over fiscal 1976 revenues was 6 per cent of its total operating budget.
According the the city government's own financial report, the last time this city ended a fiscal year with a budget surplus rather than a deficit in obligated expenditures was in 1972 when it had $2 million left over.
The District's expenditure obligations exceeded revenues at the end of fiscal 1973 by $13.7 million, at the end of fiscal 1974 by $17.6 million, at the end of fiscal 1975 by $34.4 million and at the end of fiscal 1976 by $61.8 million, the city's figures show.
Under the home rule act, the annual District budgets presented by the major and approved by City Council must be balanced which they have been on paper. However several factors in recent years have combined to cause larger and larger deficits.
Like many other cities, the District at times has received less tax revenues than its budget anticipated.
And unlike other cities, the District's budget also must be acted on by the President and Congress. And there is nothing requiring that cuts in planned revenues or increases in expected expenditures must be balanced by the President and Congress.
Noting this federal impact on the District budget, the research bureau said, "Congress must support city efforts for a balanced budget."
Coppie contended that instead of a worsening financial situation for the city, the District government actually turned the fiscal corner in the past year.
The city's budget director said the city plans to pay off half the $40 million owed this fiscal year and half in fiscal 1978.
Before he left the White House, President Ford proposed abolishing the District's authority to get such short-term loans from the Treasury a right that District leaders want to maintain. Coppie said that though the District plans to start buying short-terms notes on the private market, it would like to retain the option of going to the U.S.Treasury.
The bureau's report noted that there are some positive developments in the District's financial picture. "The city has publicly acknowledged and explained its financial problems," the bureau said. "The mayor and City Council are in agreement to have truly balanced budgets in the future," it said. Current reforms of the city's fiscal management system should help, the bureau added.
But the District has a long way to go, compared with some other cities. For example, the bureau said that according to its most recently available financial report. Baltimore's revenues exceeded that city's expenditures by $19 million.