Potential Problems in the District’s 2001 Budget

Philip M. Dearborn

The District’s financial recovery is at a critical
stage and will be threatened unless sound budget
decisions are made over the next several weeks.
While these decisions must be made by the Mayor
and the District Council, they also will need public
support and understanding. This policy brief is intended
to draw attention to the problems related to
balancing the 2001 budget.

Although the city had an accumulated surplus
in excess of $200 million at the end of fiscal year
1999 and will add modestly to that surplus in fiscal
year 2000, the surplus should not be a reason for
complacency when considering the 2001 budget. In
fact, there is no room in the 2001 budget for either a tax reduction or discretionary increases
in program expenditures, unless dollar
for dollar reductions in spending are made
in other parts of the budget.

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