Juan Williams expresses skepticism about whether the District government has truly placed its fiscal house in order, or whether the Barry administration is playing political tricks ("The Case of the Vanishing Budget Crisis," op- ed, Oct. 26). I am deeply concerned about the tone and direction of Williams' analysis.
Mayor Barry and his top financial advisers met for more than an hour with Williams and other members of The Post's editorial board prior to the article. Not one question concerning skepticism or trickery was raised at this in- depth briefing or in subsequent conversations.
The fiscal 1981 results were not achieved "abracadabra" style for mere politicking. They were won by hard work, sensitive management and superb financial controls. Besides, there is no way I or anyone else could orchestrate hidden budget deficits for re-election purposes, even if we wanted to. For the first time since 1790, the District's books are being audited by Arthur Andersen & Co. and Lucas Tucker & Co. Certainly, these companies would not risk their national reputations to satisfy the mayor.
What makes the trickery assertion even more perplexing is that it was the Barry administration that moved to revise completely our budget practices. In the past, the District could and did "balance" its budgets on a cash basis by postponing payment of its bills into future years. The budgeting system has been totally revised so that all expenditures must be in balance with all revenues. The mayor certainly received no political mileage or pluses in this revision, since it revealed decades of agency overspending, some of which continued in the early part of his administration. As he has repeatedly pointed out, the 1980 budget had built-in deficits. Additionally, the 1980 budget was designed by a prior administration. This was not the fault of Mayor Walter Washington; he inherited the federal budget system and operated with it throughout his administration.
In contrast, the 1981 budget, the first one planned and implemented by the Barry administration, was balanced under the most stringent accounting tests, without sacrificing people programs and without the need for major tax increases.
I wish it could have been done by magic; it would have made life much easier. The District reduced its work force in two years by 12.5 percent. If Williams thinks the mayor gained politically by his stringent budget controls, he should listen to D.C. government employees and the hardships created by over 4,132 lost jobs and job opportunities. There is no political mileage to be gained by the loss of jobs.
The "gee whiz" budget-year ending was made possible by financial management that enables us to spot year-end deficits before they occur, so that we may take difficult but necessary corrective measures.
Williams questions the "suddenness" of property tax revenue increases, wondering how buildings "sprouted out of the ground" so they could be taxed. Actually, the revenue gains were primarily in the income and sales tax areas as a result of aggressive, innovative tax department collection improvements. And buildings are sprouting, thanks to a planned economic development effort east of 15th Street, with the help of the convention center. This will help our job and tax base--and D.C. budgeting--over time.
Williams said we made "no mention" of the city's deficit, which has accumulated since 1970. However, the mayor's statement indicates clearly our plan to free ourselves of past years' deficits. Philip Dearborn, who served as our financial counselor, calculated that if we could have the same bonding authority as held routinely by states and municipalities across the nation, we could save $416.5 million in our capital program from tax-exempt bond rates over the next 20 years. These savings would mean a "profit" to taxpayers of $202.5 million, even after payment of all debt service costs associated with paying off the accumulated deficit.
It has been far from easy. But even with all the streamlining actions, we still have addressed the priority concerns identified by D.C. citizens. Our overall budget increases have been in the range of 6 to 8 percent per year, compared with 10 to 12 percent in the past. However, in this administration expenditures for mass transit have grown 106 percent; housing, 141 percent; employment, 109 percent; the elderly, 490 percent; the arts, 390 percent. We have budgeted $1 million in new funds for economic development.
Has "the elephant disappeared in a flash of hands"? No, but it has gone on a controlled, healthy diet, over an extended period. It's not a gazelle yet--now that's a magic trick we are working on.