DC Councilmembers Propose Tax Giveaways

June 10, 2009

The DC Fiscal Policy Institute has been blogging on proposed tax breaks for select commercial interests.

First came a posting on proposed tax abatements for six new projects. These include a luxury hotel in Foggy Bottom and two developments at Metro stations–all prime real estate and potentially very profitable. DCFPI estimates lost revenues at $3.3 million in FY 2010 and $13.7 million through FY 2013.

Now comes a posting on a bill to substitute a modest lump sum payment for the taxes the Union Station retail center pays. This one gives away an estimated $2.45 million a year.

I’m simply appalled. Here’s a City Council that:

  • Just congratulated itself for closing an $800 million budget gap while modestly increasing funding for a handful of programs that serve low-income people.
  • But couldn’t find enough funds for TANF benefits to even keep them level with inflation.
  • Couldn’t find enough funds for the Local Rent Supplement Program to support the development of more than 180 affordable housing units.
  • Virtually ignored the dire straits of the Housing Production Trust Fund–another key source of funding for affordable housing construction and renovation.
  • Is well aware that the upcoming revised revenue forecast may reveal a new budget gap.

And yet some Councilmembers are proposing bills that would reduce District revenues. If they really think we’ve got money to spare, then why not use it to shore up programs that help our most vulnerable families meet basic needs?

Doing that would make the city a better place for all of us. Tax breaks for retailers at Union State won’t.

DC Council Committee Finds $$ For Affordable Housing and More

May 7, 2009

D.C. City Council committees have finished marking up the Mayor’s budget, i.e., making changes to create the budget the Council will finally vote on. It’s pretty clear that they’re not all happy with proposed funding levels for programs that serve low-income residents–or with the proposed tax changes and fees that would hit low-income residents hardest.

But it’s not enough to have concerns. If Councilmembers want to fund increases or modify revenue raisers, they’ve got to find other funds to keep the budget balanced. And that’s what the Committee on Public Works and Transportation has just done. Details are in its draft report and recommendations.

The funds the Committee found wouldn’t come out of any other program budget. In fact, one source wasn’t in the Mayor’s budget at all–a projected $26.2 million from additional citations for neighborhood parking violations. Of this amount, $6.8 million will come from the city’s new Sweeper Cam Initiative–cameras mounted on street sweepers that are used to photo license plates of illegally parked cars.

The Committee proposes that $3.5 million of the Sweeper Cam revenues be used to increase funding for three affordable housing programs:

  • The Local Rent Supplement Program, which provides housing vouchers for very low-income residents and so-called “project-based vouchers,” which are linked to affordable housing units. (Project-based vouchers cover some of the ongoing operating costs of these units and so also help developers secure private financing.)
  • The Housing First program, which provides permanent housing with supportive services for chronically homeless individuals.
  • The Housing Purchase Assistance Program, which helps low and moderate-income individuals and families cover the down payment and/or closing costs on their first home.

Another $1.5 million of the Sweeper Cam revenues would go to the TANF (Temporary Assistance for Needy Families) program. According to the DC Fiscal Policy Institute, this wouldn’t even preserve the value of the current benefit, let alone provide TANF families with anything close to what they need for basic living costs. So they’ll still be in worse straits unless the Council finds more funds.

The other source of found funds is about $15.5 million in Metro Transit Authority costs that were double-counted in the Mayor’s budget. The Committee recommends that the Council use $12 of this instead of adopting the proposed Streetlight Operation and Maintenance Fee–a new revenue raiser that would add $51 per year to residents’ electricity bills.

The Committee would also combine $1.9 million from one of the double-counts with $990,000 in Sweeper Cam revenues to fund a continuation of the cost-of-living adjustment for the standard deduction in D.C. personal income taxes. This is one of four COLAs that would be eliminated under the Mayor’s budget.

The Committee’s recommendations aren’t a done deal. Other Councilmembers may have different ideas about what to do with the found funds. Councilmember Evans, for example, has talked about business tax cuts.

And one would hope that some Councilmembers would have reservations about the more than $6.1 million in earmarks for groups and projects in the PW&T Chairman’s ward. Enough found funds here to fully fund a real TANF increase, with plenty left over to boost affordable housing resources or preserve some of the other COLAs.

The City Council will meet on May 12 to vote on a final mark-up. So it’s time to weigh in if you’ve got views on what the priorities should be. Contact information is on the Council’s website.


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