The D.C. housing department's capital budget reflects a pattern of underspending that is "downright cruel" to public housing tenants who are living in deteriorating buildings, according to City Council Chairman David A. Clarke.

A report prepared by the council's budget office at Clarke's request shows that the D.C. Department of Housing and Community Development's fiscal 1985 capital budget, which is used for repairs and major renovation work, was underspent by $16 million, or 62 percent -- including an underspending of $3.4 million for general improvements for public housing. From April 1983 to March 1984, the housing department under- spent its capital budget by 63 percent, or $8.5 million, according to the council's budget analysis.

Meanwhile, the housing department has not maintained some of its 11,732 public housing units, creating a situation in which some tenants are living in unsafe and unsanitary conditions. Some tenants have been without heat during some of the coldest days of the winter.

"There is a capability to make improvements, and it is not being done," Clarke said Friday. "Housing is a crucial need, and it's downright cruel not to use the money . . . . What irks me is if you go to any of the public housing properties and say, 'Have you discussed the problems with the housing department?' they say, 'Yes, they told us there wasn't any money to fix it.' "

City Council member Charlene Drew Jarvis (D-Ward 4), chairwoman of the council's Committee on Housing and Community Development, said she is also concerned about past underspending, based on information supplied to her by the housing department. Nevertheless, Jarvis said she has recommended adding $6 million to the fiscal 1987 housing budget for general housing improvements and repair of vacant units.

"It is clear that there has been underobligation and underspending in 1983, 1984 and 1985 for federal and District funds," said Jarvis. "But I see a decrease in the level of underspending and a trend in the department's ability to obligate and spend money. On that basis, I'm willing to put more money in the budget for them."

During a recent budget hearing, housing director Madeline M. Petty told City Council members that past efforts to fund an entire renovation program in one year "created the impression that large amounts of money were sitting unused." She said the department had shifted to a multiyear budgeting process that involves requesting money in stages, one year to design the project and another year for construction.

The criticism about underspending comes at a time when U.S. Secretary of Housing and Urban Development Samuel R. Pierce Jr. is directing one of his top aides to work directly with District officials to shape up the city's troubled housing department.

Last year, the U.S. Department of Housing and Urban Development warned that the District housing agency could lose $8.8 million in federal funds designated for comprehensive public housing improvements if it did not use the money by December. In a January report to HUD, Petty indicated that all of the funds had been obligated. A HUD spokesman said that the report is under review and that no decision has been made on whether HUD's concerns have been satisfied.

City Council member H.R. Crawford (D-Ward 7) said he is not surprised by the housing department's underspending. He said some council members fail to understand that it takes time to complete construction projects.

Jarvis and Clarke said Mayor Marion Barry's administration has failed to make housing a priority and took exception with Barry's recent comment that employment is an area where votes are won and that pouring money into housing is like pouring money down a "sinkhole."

"He sends a message to his subordinates that this housing is not a priority," said Clarke. "We get to provide the money, but they have the checkbook."

Jarvis said: "From my perspective, housing has been put on the back burner by the administration, and if it's a sinkhole, it's time they filled it."