At a public hearing earlier this month, District Chief Financial Officer Natwar Gandhi was asked why he didn’t do more to fight corruption and waste in the city agencies he monitors.
As he has done so often, Gandhi said his job is to balance the budget, not run the city agencies.
“I’m just a bean counter,” he said.
That wasn’t the metaphor Gandhi used when he called a meeting with his staff in the city’s failing schools last fall. According to someone who attended and who spoke on the condition of anonymity, Gandhi was outraged over media reports of questionable payments to school officials. He told his staff that if he found out anyone was leaking to the press, he would fire them.
“I am the golden hammer,” Gandhi reportedly said.
For most Washingtonians, Gandhi is the golden bean counter: The man who restored stability and professionalism after decades of corruption and waste. But his continuing failure to gain control over key city agencies — especially the District’s faltering school system — has emboldened some of his critics.
“There are some chinks in the armor,” said District Council Member David Catania, I-at large, one of Gandhi’s fiercest critics.
In the city’s most recent audit, a private accounting firm blasted “a lack of internal controls” in the city’s $1.3 billion school system and said that the fraud, waste and abuse in the schools threatens D.C.’s bond rating.
The audit finding came a year after the Department of Education rated the schools “high risk” for federal funds because of shoddy accounting practices. And it came after a year of scandals in the schools, from payments to a “holistic mentor” who trained church employees on school property to a charter school executive who allegedly used companies to enrich herself, her family and her friends. All of the suspect payments were approved by Gandhi’s office.
Gandhi has blamed school officials, but Catania and others say Gandhi himself fought to retain control over the schools’ finances.
“You can’t have it both ways,” Catania said. “You’re either in charge or you’re not.”
Neither Gandhi nor his spokeswoman responded to requests for comment. Gandhi is arguably the most powerful man in city government. He employs more than 1,000 finance officers serving in every city agency and controlling $7 billion in public funds. A negative opinion from Gandhi — he was once dubbed “Dr. No” for his budget cutting — can kill a multimillion-dollar program.
For critics like Catania, it’s not Gandhi’s power that aggravates — it’s the way he wields it.
“He’s a classic sycophant,” Catania said. “To a fault, he’s sided with the executive. And it’s compromised him.”
Catania said Gandhi manipulated figures to justify the city’s baseball stadium package because it was a priority of then-Mayor Anthony Williams. For nearly a decade, Gandhi has been the District’s top accountant. He took over the finances after the city, having gone bankrupt, was being run by a congressionally mandated control board. Gandhi has delivered a balanced budget every year for nearly a decade.
“Call me what you like,” he once told an interviewer. “At the end of the day, I have to come to you with a balanced budget.”
Gandhi and his supporters say he deserves credit for delivering hundreds of millions of dollars in surplus every year. But some — like former city Finance Executive Todd Zirkle — say that the surplus is a sham.
“He was fudging the numbers,” Zirkle said.
In 2000, Zirkle said, he and oneof Gandhi’s lieutenants were preparing Gandhi’s testimony before the District Council. Zirkle said Gandhi wanted to say revenues from D.C.’s booming real estate market were $40 million. But Zirkle had found that revenues were $140 million.
When Zirkle told Gandhi’s lieutenant that Gandhi should use the larger figure in his testimony to the District Council, she said, “We can’t tell them that,” he said.
At the end of the next fiscal year, the District Council announced it had overspent and was considering raising taxes. At the last moment, Gandhi announced he had discovered a $100 million surplus, Zirkle said. Gandhi fired Zirkle in 2001 after Zirkle claimed that the politically connected law firm Wilkes, Artis, Hendricks, Lane was getting preferential treatment on city tax appeals.
“He’s a slippery fish,” Zirkle said. “It looks on the face of it that he gave us this great surplus, but who knows? He participated in making sure that Wilkes, Artis was sucking $40 million out the back door.”
Catania agrees.
“If he lowballs the projections, he takes the money out of programs,” Catania said. “It takes the prerogative away from the legislature.”
Gandhi’s supporters still outnumber his critics by a wide margin. Former District Council Member Kathy Patterson was one of Gandhi’s earliest champions and pushed for him to be appointed CFO.
“I think the city’s financial track record for the last eight or nine years is pretty good evidence that he’s done a good job,” she said.
Under Gandhi, the city’s bond rating has gone from B — a low rating that allows lenders to charge higher interest rates and put stricter limits on loans — to A-plus.
“That speaks for itself,” Patterson said.
Patterson said that “things aren’t perfect” and she hopes Gandhi will adopt a performance-based budget, where agencies can be rewarded for handling their funds responsibly.
Asked about complaints that Gandhi turns a blind eye to corruption and waste, Patterson said: “All I can tell you is that when I have gone to him looking for assistance in various agencies, he and his staff have been very helpful.”
In person, Gandhi is charming. He speaks several languages and writes poetry in Gujarati, his native language. Diminutive and deferential, he answers questions quickly and authoritatively, often in a wry, crisp tone of voice. He tells moving stories of his poor childhood in India, of his lifelong dream to come to America and how he arrived in the U.S. with $7 in his pocket. He has made the greatest impression on the most powerful figures in the city, which even his critics acknowledge.
“He has a calming effect on Wall Street,” Catania said. “He has a good handle on the challenges we face.”
Before the last mayoral election, Congress attached a rider into the D.C. appropriations bill that extended Gandhi’s contract by two years.
The city finance officer serves at the pleasure of the mayor and some saw Congress’ move as a vote of no confidence in the mayoral candidates. Adrian Fenty, who would go on to win the election, said he wasn’t fazed by Congress’ gesture.
“I have a lot of respect for Dr. Gandhi,” Fenty said at the time.
The feeling apparently wasn’t mutual. Gandhi’s spokeswoman, Maryann Young, said that Gandhi told his staff to get ready for battles with the mayor-to-be because Fenty’s programs weren’t practical.
Natwar Gandhi
» Title: Chief Financial Officer, District of Columbia
» Age: 66
» Born: Oct. 4, 1940, Gujarat province, India
» Education: Ph.D in accounting, Louisiana State University
» Career: General Accounting Office, 1976-97, D.C. tax office, 1997-2000; CFO, 2000-present
