D.C. Council members took a roundly pessimistic view of the local economy and chastised the Fenty administration’s efforts to close an immediate $131 million shortfall without planning for a potentially larger problem down the road.
“It looks like it’s all bad news to me,” Council Chairman Vincent Gray said during a public roundtable Friday on Mayor Adrian Fenty’s plan to bridge the projected 2009 gap.
Fenty has proposed slashing $60 million in expenditures, including $4 million from the police department and $1.2 million from the Child and Family Services Agency, to help close the immediate shortfall. The plan also foresees cutting more than 200 vacant positions.
The goal is to “minimize the impacts [of service reductions] as much as humanly possible,” said City Administrator Dan Tangherlini.
“I appreciate that we have to act quickly but we also have to act smartly and wisely,” said Ward 6 Councilman Tommy Wells, who has oversight of CFSA and vehemently opposed cutting from the agency responsible for child abuse and neglect investigations.
The city’s economic trouble likely goes deeper than Chief Financial Officer Natwar Gandhi’s current projection, which was based on figures from late September — days before Wall Street’s collapse. Tax collections are on the decline, council members warned, investments and pensions are suffering and government agencies face tens of millions in “spending pressures,” unplanned expenses not contemplated in the approved budget.
Gandhi acknowledged his forecast is “indeed pessimistic” and said there may be a need to come back later for more money. Initial claims for unemployment between July and September were up 35 percent compared with the same three months in 2007, the CFO told the council.
But Gandhi urged the council to wait until December, the close of fiscal 2009’s first quarter, before acting on spending pressures. That suggestion infuriated several council members who argued budget cuts will be more severe the longer the government waits to act.
“It is not prudent to wait because we are playing with people’s lives,” said at-large Councilman David Catania.
Ward 4 Councilwoman Muriel Bowser agreed with Gandhi: Wait a couple months, she said, before taking drastic actions.
“We don’t know the real scope of the problem,” Bowser said.
The council said it didn’t have enough information on the Fenty plan to schedule a vote for Tuesday’s meeting.
