Mayor Gray Takes Balanced/Unbalanced Approach To DC Budget

I, along with many others, have been advocating for a balanced approach to balancing the District’s Fiscal Year 2012 budget. Now I see that there’s more than one way to take an unbalanced approach.

What we meant was that the budget should be balanced by a reasonable mix of spending cuts and new revenue-raisers. Mayor Gray did a relatively good job on this score.

“Relatively” because, according to the mayor’s own summary, spending cuts account for $187 million, while the revenue-raising proposals would bring in a projected $135 million.

But the spending cuts are egregiously unbalanced. As the DC Fiscal Policy Institute reports, human services programs would lose $130 million — more than two and a half times their share of the locally-funded budget.

The mayor deserves credit for backing off his opposition to any increase in income taxes. He proposes a new, slightly higher top rate for residents with adjusted incomes over $200,000 — 0.4% higher than what they’re paying now.

According to the Chief Financial Officer’s letter certifying the budget as balanced, the new bracket, plus some unspecified limit on itemized deductions, would yield $35.4 million next year — somewhat over a third of what the plan advocated by Save Our Safety net and allies would bring in.

But at least it’s a step in the right direction — maybe even an indication that the mayor attended to the feedback he asked for.

Other smart revenue-raisers include an extension of the sales tax to live theater tickets, an overdue hike in the off-street parking tax, an increase in the modest minimum business franchise tax and, I infer, the final legislation needed to prevent multi-state corporations from legally evading the local corporate tax.

But the proposed budget is nonetheless, to use the old cliche, balanced on the backs of the poor.

We’ll undoubtedly be learning more about the cuts to human services programs in days to come. So let me just pick out three of the big ones here.

Homeless Services. The proposed budget would reduce funding for homeless services by $11 million — this when the current funding shortage has led the Department of Human Services to deny shelter to homeless families who’ve got no place to stay.

IDA. Local funding for the Interim Disabilities Assistance program would be cut by 75%, leaving only $875,000 for stipends to low-income severely disabled residents who are waiting for the Social Security Administration to act on their claims for Supplemental Security Income.

Last year, SSA had a backlog of more than 705,300 disability claims hearings. Now it’s unable to speed up resolution time because the budget impasse in Congress has meant no additional funding. So it seems that no one on the IDA waiting list will get a stipend for a very long time, if ever.

TANF Benefits. Funding to provide cash assistance to families enrolled in the Temporary Assistance for Needy Families program would be cut by an additional $7.9 million.

I understand that $4.9 million of this cut represents the mayor’s reversion to his earlier plan to totally phase out benefits to families who’ve been in the program for more than five years.

The initial 20% cut that’s already been imposed leaves a family of three with $342 per month — 21% of the very low federal poverty line. Imagine what this means to the children whose future the mayor claims to be so concerned about.

Imagine what it will mean when the family gets even less and then less until there’s no cash income at all. And this almost certainly will happen to some families because many long-term TANF recipients face formidable, multiple barriers to work.

The remaining $3 million will be “saved” by imposing full family sanctions, i.e., cut-offs of all cash assistance when the participating parents don’t comply with the requirements in the job preparation/job search plan that’s been developed for them.

We’ve seen something like this before — in former Mayor Fenty’s 2009 budget-gap closing plan.

As I remarked at the time, it creates a perverse incentive to find TANF parents in noncompliance, minimize efforts to resolve problems and get sanctions in place as quickly as possible because that’s the only way sanctions can save as much as the budget assumes.

In his recent State of the District address, Mayor Gray asked us to share his vision for the District and its government. “Above all,” he said, “it is a compassionate government — one that takes as its most urgent task the welfare of the least fortunate among us.”

I don’t see that in his proposed budget. Do you?

UPDATE: I was too optimistic about prospects for disabled residents on the IDA waiting list. DCFPI analysts report that Mayor Gray’s budget would suspend the program. This means that no more eligible residents would get benefits. Instead, vacant slots would be eliminated until the program ceased to exist.

One Response to Mayor Gray Takes Balanced/Unbalanced Approach To DC Budget

  1. […] But the Council’s apparently not going to use much of the found money to restore the deep cuts the mayor’s budget makes in affordable housing or key safety net programs. […]

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