D.C. Mayor Marion Barry has ordered a partial government hiring freeze effective immediately and has told city agencies to prepare provisional budget cuts of 10 percent in an effort to offset rising public safety costs, revenue shortfalls and possible curbs in federal funding.
Barry, who is attending a conference in Ottawa, ordered the surprise austerity action in a memorandum circulated without public announcement to government agencies yesterday. A copy of the memo was obtained by The Washington Post.
"It is clear we must resize, reevaluate and reshape District government services," Barry said in the memorandum. "I am also asking you to delay all discretionary hiring and procurement until I have made preliminary decisions on FY 1988." No layoffs of employes are expected.
The move is a reversal of Barry's expansionist budget plans in the current fiscal year, which began Oct. 1, and may signal a departure from the trend of rapidly increasing D.C. government spending in recent years.
D.C. Council Chairman David A. Clarke (D) said last night that the council had been unaware of Barry's memorandum but suggested that the mayor "is coming to an awareness later than the council" that the city faces serious budget problems.
Barry wrote that court-mandated activities and basic city services would not be included in the budget cuts, which are due to be delivered to Budget Director Richard C. Siegel's office by Wednesday. Siegel, who is directing the proposed budget cuts, was not available for comment on revenue projections or other aspects of the budget plan.
Barry's memo noted that the 1988 operating budget, about $2.6 billion, does not include pay raises for city employes. The District is in the midst of negotiations with city employe labor unions and officials have estimated that labor costs could rise more than $33 million in this fiscal year.
Although some city officials suggested that the memorandum could be used as a bargaining tool by the city to hold down wage settlements, others pointed out that it comes after a year in which the D.C. Council stymied Barry's efforts to raise income taxes to cover spending needs.
In addition, Barry's 1988 budget was widely seen as having underestimated rapidly growing costs of public safety, particularly in the city's troubled Corrections Department.
In budget battles this year Clarke, Finance Committee Chairman John A. Wilson (D-Ward 2) and other council leaders slashed more than $11 million from Barry's plans to hire several thousand new government employes.
The District employs about 38,000, with 2,100 more scheduled to be added this year -- not including the 1,600 employes of St. Elizabeths Hospital, which came under city control Oct. 1.
"A cut of 10 percent for most agencies would not be particularly drastic at this point," one council staff member said, "especially if they are alerted to it this early" in the fiscal year. Many city agencies could hold down costs by not hiring new employes.
In June, a private study criticized the Barry administration for attempting to expand city services and hire new employes rather than control costs and continue efforts to trim the city's long-term budget deficit, now about $200 million.
"The problem is not revenue," said Philip Dearborn, an analyst with the Greater Washington Research Center. "There's ample money coming into the District. It's . . . the purposeful efforts to add programs and employes that are causing the problem."