Mayor Marion Barry proposed yesterday a fiscal 1987 District budget that contains no tax increase, raises spending in sensitive social services and finances the expansion of the city's overcrowded corrections system -- but does not take into account potentially severe federal budget cutbacks.
The mayor's proposed operating budget of $2.4 billion represents a modest 5.8 percent spending increase of $131.6 million over the current fiscal year, a large chunk of it going to negotiated employe pay raises.
It includes sharply increased funding in a few priority areas, including AIDS initiatives, several new programs for the city's rapidly increasing Hispanic population, tenant assistance, public housing renovation, drug treatment and help for the homeless.
While city officials have been predicting for weeks dire consequences from federal Gramm-Rudman-Hollings cuts in fiscal 1987, Barry's plan carries none of the pain of his budgets two and three years ago, when fiscal pressures caused him to propose deep cuts in social services and then a major tax increase.
"Last year's was a good news budget, and this is a better news budget," the mayor said, insisting that the plan is realistic despite its failure to account for possible federal cutbacks.
But some members of the City Council, which has 50 days to approve a new budget, voiced skepticism.
"In my estimation, what it is is an election-year commercial," said council member John Wilson (D-Ward 2), chairman of the council's Finance and Revenue Committee. "I don't think a great deal of it will become a reality."
Council Chairman David A. Clarke said that he feared the mayor would get by with making "big promises" and try to force the hard choices on the City Council if large federal cuts are announced.
Barry did use the expected federal budget cuts as the main reason he budgeted nothing for reduction of the city's accumulated general fund deficit, which stood at $244.9 million at the end of fiscal 1985. In the past, the City Council and Congress have insisted the city allot $20 million for this purpose, requiring reductions in other areas.
At the same time, the U.S. Office of Management and Budget confirmed that President Reagan will propose a $19.5 million increase next week in the annual federal payment to the city, to a fiscal 1987 level of $444.5 million -- a surprising development during a time of severe federal budget austerity.
The city took a freeze in the federal payment last year and so was given an inflation adjustment this year, said an OMB spokesman.
This increased funding is not accounted for in the mayor's budget, but he indicated that it would be used in part to pay for negotiated pay raises for police officers that will cost another $15 million not in his announced budget plan.
Barry predicted that economic growth would continue, but at a slowed pace, giving the District government less automatic revenue growth that comes from increased business and employment. The city plans to raise $15.4 million in fiscal 1987 from new fines and increased business fees, and improved collections, according to the budget.
City officials said that payments under Aid to Families with Dependent Children and the city's General Public Assistance plan for disabled workers will increase by 5 percent in fiscal 1987. But the budget reflects a $3.7 million decrease in the cost of AFDC, which officials attributed to a declining caseload.
Of the $131.6 million in increased spending, $23 million will go toward relieving jail overcrowding. Part of the increase will be used to operate a temporary 400-person medium-security facility planned for the Lorton prison complex as well as add two new community work-release centers. Barry expressed frustration that so much must go to that area.
"The criminal justice system is driving us," the mayor said. "It's the tail wagging the dog."
The plan did not include budgeting for construction of a major new prison in the District, which Barry has promised Congress he will do with federal funds that have been appropriated for the purpose. But the mayor said it would not cost the city much to start the design process for the prison, and that that phase could start as soon as a federal site in the city is selected.
The mayor also recommended large increases in housing and jobs programs, more than offsetting expected federal cuts in those areas. Spending at the D.C. Department of Housing and Community Development would rise by $16.4 million, including expansion of programs to help low-income tenants pay rent or buy into a cooperative.
It also includes the start of a $190 million, six-year plan for renovation of public housing units.
Barry repeated his guarantee of a summer job for any District youth who wants one this summer, and added $2.1 million to expand the program in fiscal 1987. A job program to help ex-offenders get back into the community would be expanded to reach 400 persons during the year.
The AIDS initiatives would raise spending in that area to $1.9 million, up from $10,000 in fiscal 1984. Included would be funds for shared-living arrangements and chore services for acquired immune deficiency syndrome patients in their homes.
Spending on services to the Hispanic community would jump fivefold to $2.4 million in fiscal 1987, with the budget documents estimating that the Hispanic population has more than doubled since 1980. The funding would be used for bilingual health and job training services, 911 emergency assistance, and help with legal assistance and in complying with city regulations.
Aid to the homeless would get another $1.9 million, which the mayor said would be used to increase the number of shelter beds and provide mental health services and financial aid.
The city's budget for the school system would rise by $21 million, mainly for negotiated pay raises and inflationary costs, and no new positions were anticipated by the mayor's plan. He noted that school officials are not satisfied with the budget he has proposed and will take their case to the City Council.
The courts, on the other hand, which submit their own budget proposal, for the first time have reached agreement with the mayor on a recommended spending level. The D.C. Superior Court would get a $3 million funding increase to $43.9 million.
The mayor's budget proposed yesterday could be substantially affected by President Reagan's fiscal 1987 budget to be announced next week. Reagan is expected to scale back domestic spending to avoid automatic across-the-board cuts provided for in the Gramm-Rudman-Hollings legislation, passed by Congress in December.
Barry said yesterday that if federal cuts are severe he would want first to protect services to the needy, but he declined to say whether this would require a tax increase.
The mayor's submission of his budget to the council, an important event in the city government's annual calendar, was interrupted briefly by an earth tremor that noticeably shook the District Building. City Council member Wilson left the room, exclaiming that "the building is shaking," and an aide suggested later that the tremor could have been an omen.