19 TRANSPORTATION SERVICES AND ASSISTANCE THE DEPARTMENT OF TRANSPORTATION'S BUDGET IS PLANNED AT $33.4 MILLION, A DECREASE OF $549,000 FROM 1980. THIS ADJUSTMENT WILL NOT HAVE A SERIOUS IMPACT ON THE MAINTENANCE OF ESSENTIAL PROGRAMS; HOWEVER, SERVICE ADJUSTMENTS WILL BE REQUIRED TO MEET THE CHALLENGE OF THE BUDGET REDUCTION. THE DISTRICT'S SHARE OF THE WASHINGTON METROPOLITAN TRANSIT AUTHORITY'S OPERATING SUBSIDY IS $73.5 MILLION, OR A 35 PERCENT INCREASE ABOVE FISCAL YEAR 1980. ENVIRONMENTAL SERVICES AND SUPPLY THE ONLY SIGNIFICANT INCREASE IN THIS AREA IS AN ADDITION OF $945,400 TO THE DEPARTMENT OF ENVIRONMENTAL SERVICES. THE DEPARTMENT'S STAFF WILL BE REDUCED BY 315 POSITIONS. INFLATIONARY ENERGY COSTS. THE INCREASED BUDGET IS ATTRIBUTABLE PRIMARILY TO CAPITAL IMPROVEMENTS FUNDING IS PROPOSED FOR 47 CAPITAL PROJECTS. THE CROSSTOWN WATER MAIN, THE CONVENTION CENTER AND METRO BUS AND RAIL PROJECTS WILL ACCOUNT FOR $77 MILLION OF THE APPROPRIATIONS REQUEST. IN ADDITION, RESURFACING OF 24.1 MILES OF DISTRICT STREETS AND HIGHWAYS, THE CONSTRUCTION OF A NEW SEVENTH DISTRICT POLICE STATION AND THE CONTINUED DEVELOPMENT OF THE FORT LINCOLN INFRASTRUCTURE ARE PLANNED. AS I STATED EARLIER, MR CHAIRMAN, THE TOP PRIORITY FOR FISCAL YEAR 1981 IS THE IMPROVEMENT OF THE DISTRICT'S HOUSING STOCK. TO ADDRESS THIS NEED, FUNDS ARE PROPOSED FOR VARIOUS CAPITAL PROJECTS: $3.7 MILLION TO RENOVATE THE EAST CAPITAL DWELLINGS $6.1 MILLION TO REPLACE GAS LINES AT NINE PUBLIC HOUSING DEVELOPMENTS o $11.3 TO PROVIDE BASIC INFRASTRUCTURE OF STREETS, WATERMAINS AND SEWERS NECESSARY FOR THE CONSTRUCTION OF 1,800 UNITS IN THE BUZZARD'S POINT AREA. THE CAPITAL BUDGET ALSO INCLUDES A $26.7 MILLION FUNDING INCREMENT TO COMPLETE CONSTRUCTION OF THE CONVENTION CENTER, AND $8.8 MILLION FOR IMPROVEMENTS TO D.C. GENERAL HOSPITAL FOR RENOVATION OF EMERGENCY ROOM AND AMBULATORY CARE FACILITIES, AND MEETING HANDICAPPED ACCESS REQUIREMENTS. REVENUE AUTHORITY THE FISCAL YEAR 1981 BUDGET CALLS FOR CHANGES IN REVENUE AUTHORITY WHICH WILL BRING IN ABOUT $27.9 MILLION. THIS PROPOSED NEW REVENUE AUTHORITY A PROPOSED EXPANSION OF THE RECORDATION TAX TO INCLUDE SECURITY INTEREST DEEDS WILL YIELD AN ESTIMATED $1.0 MILLION IN FISCAL YEAR 1981. SIX SMALLER MEASURES COMPLETE THE NEW REVENUE AUTHORITY PACKAGE FOR FISCAL YEAR 1981. INCLUDED ARE: SOME $650,000 IN SPECIAL ASSESSMENTS ON UTILITIES TO PARTIALLY FINANCE THE PUBLIC SERVICE COMMISSION; A DOUBLING OF SALES TAX EXEMPTION FOR PUBLICATIONS SOLD BY SEMI-PUBLIC INSTITUTIONS EXPECTED TO YIELD $400,000. FEDERAL PAYMENT MR. CHAIRMAN, IT IS WITH THE GREATEST URGENCY THAT I NOW SEEK YOUR SUPPORT FOR THE FULL FEDERAL PAYMENT DUE THE DISTRICT OF COLUMBIA. FROM 1975 TO 1980 THE DISTRICT'S BUDGET EXPERIENCED GROWTH OF 50.5 PERCENT. BY CONTRAST, HOWEVER, THE FEDERAL PAYMENT HAS ONLY INCREASED 5.3 PERCENT FOR THAT SAME PERIOD OF TIME. FUNDING OF THIS BUDGET AND THE SUPPLEMENT FY 1980 AND AMENDED FY 1981 BUDGETS WHICH WILL REACH YOU SHORTLY, DEPEND ON THE RECEIPT OF THE FULL FEDERAL PAYMENT. MR. CHAIRMAN, THE FEDERAL PAYMENT IS NO GIFT OR SUBSIDY TO D.C., BUT RATHER IS A VALID PAYMENT TO US TO COMPENSATE FOR THE IMMENSE AMOUNT OF FEDERAL AND FOREIGN TAX EXEMPT LAND IN D.C., AND FOR THE SERVICES WE PROVIDE TO THE FEDERAL GOVERNMENT. I AM SURE YOU KNOW THAT FEDERAL LAND HOLDINGS ARE GREATER IN ACREAGE THAN OUR OWN LAND HOLDINGS IN D.C. IN D.C., IS ONLY 44.9 PERCENT OF THE TOTAL. D.C., AS A STATE-TYPE TAXING JURISDICTION, DOES NOT HAVE NON-RESIDENT INCOME TAXING AUTHORITY EVEN THOUGH EVERY STATE IN THE NATION WHICH HAS AN INCOME TAX HAS THE AUTHORITY TO TAX THE INCOME OF NON-RESIDENTS EARNING INCOME WITHIN THE STATE'S BORDERS. FIFTY-ONE AMERICAN CITIES HAVE A NON RESIDENT INCOME TAX. WE DO NOT GAIN THE BENEFIT OF TAKING IN REVENUES FROM THE RELATIVELY AFFLUENT SUBURBS TO HELP SHOULDER THE SOCIAL AND ECONOMIC BURDENS OF OUR REGION. RATHER, WE SHOULDER THE VAST MAJORITY OF OUR REGION'S POVERTY-RELATED PROBLEMS. THE RESTRICTION OF DISTRICT'S AUTHORITY IN THIS MANNER SERIOUSLY AFFECTS OUR ABILITY TO GENERATE MUCH-NEEDED REVENUE. MR. CHAIRMAN, HAD THE GROWTH FIND ITSELF IN A MORE STABLE FISCAL POSTURE. HOWEVER, THE PRACTICE HAS BEEN TO REDUCE THE PAYMENT DURING YEARS THAT LOCAL REVENUES WERE RECEIVED AT HIGHER THAN-ANTICIPATED LEVELS. BECAUSE OF THIS PRACTICE, WE HAVE NOT BEEN ABLE TO SUSTAIN THE CUSHION NEEDED FOR TIMES, SUCH AS NOW, WHEN REVENUES FALL SHORT OF OUR PROJECTIONS. I ASK FOR YOUR SERIOUS CONSIDERATION AND YOUR FULL RESPECT FOR OUR LOCAL BUDGET PRIORITIES AND URBAN NEEDS. IN CONCLUSION, I AM SEEKING THE FULL $300 MILLION AUTHORIZATION TO FUND THE FISCAL YEAR 1981 BUDGET. ALSO, IT IS MY SINCERE HOPE THAT DURING THIS SESSION OF CONGRESS ADDITIONAL AUTHORIZATION IN THE FORM OF A PREDICTABLE AND EQUITABLE FORMLULA-BASED PAYMENT WILL BE FORTHCOMING, TO AID ALL OF US IN OUR FISCAL PLANNING IN FUTURE BUDGET YEARS. THIS COMPLETES MY PRESENTATION, AND I WOULD BE GLAD TO RESPOND TO ANY QUESTIONS YOU MAY HAVE. INTRODUCTION OF CITY WITNESSES Mayor BARRY. With me is Mrs. Gladys Mack, who is Assistant City Administrator for Budget and Resource Development. I am also glad to be at the same table with the distinguished Chairman of our Council, who will have his own statement later. BUDGET PROCESS IN THE DISTRICT OF COLUMBIA Mr. Chairman, let me say that the budget which is before you is the final product of a process which began in March of 1979. If you look to your right up there, we have prepared a chart which demonstrates that our local budgetary process is some 18 months. I think that is significant in the sense that the Federal Government just submitted its proposed 1981 budget to the President in January of this year and it will go through its processes and will end up being adopted. UNFORESEEN FACTORS IMPACTING FISCAL YEAR 1981 BUDGET Because of that long timeframe, the District Government has experienced a number of circumstances which we have to factor into 1981. I will not detail today what I am proposing to do about our 1980 situation. I am going to release a very comprehensive budget reduction program in another 3 or 4 days which outlines very specifically what the Administration has done since October 1, 1979, and proposes to do up until September 30, 1980, to bring our expenditures to a reduced level. Let me just say, Mr. Chairman, that the city started fiscal year 1980 greatly underfunded in the sense that we received about $48.4 million of additional monies in 1980 over 1979 with a mandatory and statutory liability of at least $100 million. Included in that is the $13 million Metro payment, $54 million obligations in salaries and on down the line. PROFESSIONAL TAX SUIT Therefore, we are facing some circumstances that we had not factored in the 1981 budget. We had two court decisions which we could not predict which will affect our funding in 1981. One of those has been the professional tax suit which will cost about $41 million, that we have to pay out of our cash. So we are not expected to have- Chairman JULIAN DIXON. If I could interrupt you there. What is the status of that case? Mayor BARRY. As I understand, it is on appeal to the Supreme Court. We have a stay until April 7 of the final order and also we have filed-where is Mrs. Rogers? She is the Corporation Counsel for the District of Columbia. Mrs. ROGERS. We have a stay until April 7 of this year from the D.C. Court of Appeals. We have to file our petition for cert by May 12 of this year. We are in the process of working on it now and hope to be able to file by that time. |