The D.C. City Council voted yesterday to override Mayor Marion Barry's veto of a bill stripping the Housing Finance Agency of authority to approve bond issues, and in response six of the agency's nine board members offered the mayor their resignations.
Charlene Drew Jarvis (D-Ward 4), who introduced the legislation to take away the board's power and led the fight to override Barry's veto, said the resignations would simply give the council an opportunity to restructure the board.
But Barry said the resignations created an immediate problem. "With the action of the council and the resignation of the board, we have a Housing Finance Agency crisis," Barry said, "and I will do all I can in the next day or so, working with the council, to get us out of this dilemma."
Before yesterday's action, the six-year-old, quasi-independent agency -- formed to alleviate a shortage of housing for low- and moderate-income residents -- had the power to sell tax-exempt bonds and use the proceeds to make low-interest funds available for residential mortgage and construction loans.
In vetoing the legislation to strip the agency of that authority, the mayor sent the council last week a seven-page message saying that the agency had done an outstanding job and that the process spelled out in the bill -- review of bond issues by the council -- would be cumbersome and unwarranted and could prompt a lower rating for the agency's bonds.
But some council members said they viewed the veto as an attempt by the mayor to maintain control of the agency's policies. Last month, in passing the legislation, council members had said that the agency had not set adequate priorities for its task of creating new housing and had refused to follow the council's suggestions for addressing the housing shortage.
The council bill affecting the agency was passed as an emergency measure, and as such will be in effect for 90 days. Jarvis agreed to delay for two weeks any action on companion legislation that would extend the emergency bill and explain in detail how the council would take over the agency's bonding authority.
The only two council members who voted against the override, John Ray (D-At Large) and Polly Shackleton (D-Ward 3), questioned why the council, which has 30 days to override a veto, could not wait until it votes on the companion legislation.
Ray said he was not certain if the override was an effort to do what is best for the city or part of a "tremendous power play" between the council and the executive branch.
Jarvis denied that the action was a power play, but said it had sent a signal to the mayor. "The message is that the executive branch must consider the council as a coequal branch and that we must know of issues before they occur and that he must involve us before actions are taken," Jarvis said.
Shortly after the council meeting ended, the Housing Finance Agency board met and six members, all of them appointed by the mayor, voted to offer their resignations, effective Feb. 28.
The six members are Theresa Watson, board chairman and president of the American League of Financial Institutions; Malcolm Peabody, board vice chairman and president of Peabody Corp.; Ruth Banks, a lawyer; Blenna Cunningham, vice president of United National Bank; John Oxendine, president of Broadcast Capital Fund Inc., and Herman Greene, chairman of the board of Far East Community Service Inc.
The other three board members are members of the Barry administration and did not resign.
"The council action in overriding your veto . . . places the agency board in an untenable position," Watson said in a letter to Barry. "We are expected to be responsible for the operation of this agency and bring affordable housing to the citizens of the District and yet the council would deny us the authority to act without its approval . . . The council's action will produce less housing, not more." Deputy Mayor for Finance Alphonse Hill, a member of the board who attended the executive meeting and did not resign, said board members felt "boxed in" by the council's action. "Some of the board members felt dismayed that the council wanted control of the board and control of the agency," Hill said.
The council's action was the second time in three months that the council has voted to override a veto, and some council members said that yesterday's vote followed an intense lobbying effort by the mayor.
The council meeting began about 30 minutes late while the mayor and his representatives telephoned council members. A letter from Barry appealing to the council not to override the veto was delivered to Council Chairman David A. Clarke 16 minutes after the meeting was scheduled to start, and Betty Ann Kane (D-At Large) received the letter in the elevator as she headed for the meeting.