D.C. mayor pitches first budget drop since Great Recession
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Mayor Muriel Bowser and city administrator Kevin Donahue. Photo: Heather Diehl/Getty Images
Mayor Muriel Bowser's new budget proposal would scale down D.C.'s paid leave program and reduce cash assistance for needy families, and it is expected to lead to lower pay for some child care educators.
Why it matters: D.C. is arguably having its worst financial year in a generation, leading Bowser to propose a 3.6% budget cut.
- The city's top line budget number — $21.2 billion — marks the first year-over-year spending decrease proposed since the Great Recession, city officials confirmed.
The big picture: Federal job losses and downtown's continued slump are leaving City Hall with less money to spend.
- "The District is by no means broke," said Bowser, who will leave office in nine months. "But what we need to be is more strategic about how we grow and how we spend."
State of play: Bowser plugged a $1.1 billion budget gap with several big cuts, the biggest one saving $127 million from zeroing out future pay increases for city government workers.
- D.C. would no longer offer 12 weeks of sick leave, at least for one year, amounting to $95 million in savings, officials said. A fund to subsidize the salaries of child care workers would also be cut, along with programs that offer support for low-income families, including TANF cash assistance.
Between the lines: Health care programs were mostly unscathed, despite a $172 million increase in Medicaid costs. Preserving the health care budget "was an extraordinary feat," said city administrator Kevin Donahue.
The fine print: Bowser proposes raising $19 million in new revenue through increases to business fees, like an 80-cent per hotel room guest charge, a higher rental car tax and higher sales tax on medical marijuana.
What we're watching: Bowser's budget proposes a bargain for developers — buy a federal building, pay no property taxes for 20 years.
- "We have to be a good place for investment," Bowser said.
Zoom in: All of the buildings shaded in pink (above) are federal offices the Trump administration is looking to offload.
- Imagine the opportunity for D.C. — like turning a chunk of Southwest by the National Mall into a new livable neighborhood.
- The Trump admin announced the FBI would move down Pennsylvania Avenue into the Reagan Building, opening up its hulking HQ to redevelopment.
Stunning stat: Council member Charles Allen pointed out the for-sale USDA HQ — about 70% empty on any given day — has roughly the same square-footage as the Empire State Building, just spread wide.
💭 Cuneyt's thought bubble: The fact that D.C.'s overall budget is shrinking is highly unusual. It underscores this uniquely difficult moment.
- Even during the pandemic, a flood of federal dollars helped rescue the budget, something the city can't rely on anymore.