The D.C. City Council yesterday authorized Mayor Marion Barry to borrow $60 million from the U.S. Treasury to ease the city's latest cash-flow problem--this one apparently triggered last month by a new federal policy that requires the District to pay some debts now, rather than later in the year.
At issue is a total of $70.8 million that the city owes the federal government for care of indigent mental patients at St. Elizabeths Hospital and of District criminals housed in federal prisons.
The federal Office of Management and Budget (OMB) threatened last month to deduct that amount from the final installment of the $336.6 million annual federal payment to the city unless the debts were paid, according to city officials.
But City Administrator Elijah B. Rogers promised that the city would pay the debt by the end of January, and OMB released the final installment of $192.6 million Monday.
For years the city has turned to the Treasury in the spring and summer to borrow as much as $80 million a year in interest-free loans to tide it over during slumps in the collection of D.C. taxes. But this year the city was forced to go to the Treasury about two months earlier than usual under the new OMB policy.
Rogers insisted that the new OMB policy merely reflected the Reagan administration's determination to collect past-due bills and was not meant to punish or criticize the city for falling behind in its payments.
An official of the federal Department of Health and Human Services, which oversees the federally operated St. Elizabeths, said yesterday that he agreed with Rogers' assessment.
"The department is taking normal administrative action over bills that date back 2 1/2 years," the official said. "I don't think it's a big flap or big pressure."
Rogers said that the city normally would have waited until March to borrow money to cover cash-flow problems. He said he expected the city would borrow an additional $20 million from the Treasury later this year.
The council approved by voice vote Barry's request to borrow the $60 million, after several council members complained that the mayor waited until Monday to tell them that he needed the money. Council member Betty Ann Kane (D-At Large), was the only member who opposed the measure.
The council approved new labor contracts with six unions that represent about half the city's approximately 33,000 workers. The contracts provide for pay increases of 18 to 20 percent over three years, in addition to a one-time bonus this year of 3.2 percent.
The council also gave preliminary approval to legislation that would allow Vietnam-era veterans up to 10 years after their discharge to qualify for special hiring preference for city jobs. The limit now is five years. Veterans who actually served in Vietnam and disabled veterans would be entitled to a lifetime preference.
And the council gave initial approval to a bill that would pay some victims of crimes in the city up to $25,000 for personal injury and loss of income.
Mayor Barry asked for the bill and said it would cost about $750,000 to fund the first year. But several council members raised questions about the administrative costs connected with the legislation and have asked Barry for more information.