The Numbers: The DC Budget Is Coming!

What Can You Expect? How Can You Get Involved?

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The budget is where political rhetoric meets reality. DC’s elected leaders know that residents care about schools, housing, healthcare, jobs and more. But they also know there’s never enough money for everything.

Budget decisions affect all of us. The budget also is the main tool for addressing DC’s economic and racial inequities and creating opportunity for all residents to benefit from our city’s growth. The need is urgent. Despite a booming economy, poverty in DC is no lower than a decade ago, the median Black household income hasn’t budged, and skyrocketing housing costs are resulting in the growing presence of tents as homes of last resort.

It may be early in 2020, but the budget debate for fiscal 2021 is underway. Mayor Bowser just finished four budget engagement forums, and her proposed budget goes to the DC Council on March 19.  But it’s not too late for you to get involved. In fact, the timing is perfect.

The good news is that DC’s finances are incredibly strong, with a $500 million surplus last year that filled our reserves with millions left over.  At the same time, the needs of our prosperous-but-gentrifying city are great, as residents told the mayor at her budget forums.

This column walks through key features of DC’s budget conditions and the budget process, with tips for getting involved. For a deeper dive, see DCFPI’s A Resident’s Guide to the DC Budget.  

DC’s Surplus: What Does it Mean?
The recent news of DC’s hefty $500 million budget surplus in 2019 marks an important moment in DC’s finances. The surplus allowed DC to fill its reserve requirements—after nearly a decade of working toward it—and still left $324 million to fund affordable housing and other projects. With our reserves now filled, it means that 100 percent of future surpluses will be available to be spent, rather than saved.

This will provide hundreds of millions of dollars for badly needed affordable housing construction. Under legislation passed in recent years, half of each year’s budget surplus, once reserves are full, goes to DC’s Housing Production Trust Fund for development of affordable housing. The 2019 surplus generated $162 million for the HPTF. When added to the roughly $70 million in taxes dedicated to the Trust Fund under current law, it will double DC’s investment and help develop 1,500 new affordable homes.

Under current rules, the other half of annual surpluses goes to fund DC government capital projects, like schools and fire stations. Now that this opportunity is here, it’s worth broadening the list of possible ways to use these funds. Our annual surplus could serve other urgent purposes, such as repairing public housing, protecting legacy small businesses being priced out by gentrification, or helping DC residents become first-time homebuyers.

How You Can Get Involved
There are many opportunities to let the Mayor and Council know what you want to see in the budget (though some opportunities have passed this year).

  • DC Council Budget Hearings: Once the mayor’s budget comes out, the Council holds a round of hearings,  to get resident input on the Mayor’s budget, especially where it falls short.
  • Connect with the Mayor and Council on Your Own: All residents should feel free to send a letter or email to the mayor, to their Ward Council members, or to the five at-large councilmembers.  Or let them know what you think if you see them in the community.

There is no guarantee that you’ll get what you ask for, but for sure you won’t get much without asking.

Some Key Budget Issues
With the budget around the corner, here’s some of the buzz in budget advocacy circles.

Schools: The past year was a tragedy for school budgets. Funding per student increased, but less than the increase in key costs—including average teacher compensation. Beyond that, DCPS diverted funds intended for “at-risk” students and many schools in Wards 7 and 8 faced steep cuts.  This year, Mayor Bowser is taking some steps to avoid that, with a historically high 4% increase in per-student funding. However, she hasn’t proposed any increase in funding intended for students who are low-income or otherwise at-risk, which is key to closing the opportunity gap in DCPS.

Many advocates also are pushing for more mental health professionals in schools, to address the very high rate of trauma experienced by students in low-income communities and families.

Early Education:  There is little that is more important than investments in the healthy development of babies.   The District payments in the childcare subsidy program are below the level needed to provide high-quality care, leaving many providers struggling to even keep their doors open. This has led to limited access to childcare in DC’s lowest-income communities. In 2018, the District passed legislation to address these issues—the Birth to Three for All in DC Act—with advocacy led by the Birth to Three Policy Alliance of which DCFPI is a part. The legislation provides a great roadmap but remains only partially funded and implemented.

Housing: The surplus money going to the Housing Production Trust Fund will make a huge difference in DC’s affordable housing landscape.  But for a variety of reasons, the Trust Fund alone has not reached the lowest-income households, like seniors living solely on social security or a full-time minimum wage worker. To get there, DC needs to layer on additional support through the Local Rent Supplement Program—at least $24 million next year.

Homeless Services: Substantial support for homeless services by Mayor Bowser has not been enough to keep up with the gentrification forces that are pushing more people into homelessness. The mayor just announced a new plan to end homelessness, and to get on that path she will need to provide money to house 1,800 individuals and families.

These offer just a sample of the key issues the mayor and Council will tackle this spring. Before it’s too late, you should let them know what else you want to see in the budget this year.

Ed Lazere is the Executive Director of the DC Fiscal Policy Institute (www.dcfpi.org). DCFPI promotes budget and policy solutions to reduce poverty and inequality in the District of Columbia and increase opportunities for residents to build a better future.