Facing shortfall, D.C. considers cures for budget

November 20, 1990|By Arch Parsons | Arch Parsons,Washington Bureau of The Sun

WASHINGTON -- Describing the national capital's financial condition as "extremely serious," a special commission recommended yesterday that the city be authorized to tax the incomes of non-residents who work here or that the federal government more than double its annual contribution to Washington's municipal budget.

The panel further recommended that the District of Columbia's government work force of 48,000 -- which takes half the city's budget to maintain -- be slashed by 6,000.

It also proposed creation of a metropolitan-area transportation authority to improve the area's roads and bridges.

These were three of more than 100 recommendations made by the Commission on D.C. Budget and Financial Priorities -- a group of 44 people drawn from the top levels of the city's business, academic, religious and activist-organization establishments -- in a five-year plan for the city, which the panel said is on the brink of insolvency.

The city's deficit for the current fiscal year has been estimated at $200 million out of a total budget of $3.87 billion. The commission said the deficit would rise to $700 million by fiscal 1996 "if actions are not taken quickly to reduce spending or raise revenues or both."

Of this year's revenue, the federal government contributed $495 million.

Alice Rivlin, chair of the commission and an economist who was formerly director of the Congressional Budget Office, introduced the study by acknowledging that some of its recommendations would be "controversial" and "painful."

Indeed, the controversy began even before Mrs. Rivlin unveiled the study at a news conference at the Brookings Institution, where she is a senior fellow.

For example, the study noted that the city "already has more police per capita than any other city in the world," and it recommended cutting 1,605 positions from the police force -- including 1,000 positions authorized and funded only recently by the City Council and Congress.

The commission found that Washington's "epidemic" of drug abuse and crime, which has raised expenditures for law enforcement and other services, was one of two immediate causes of the city's financial crisis -- the other being a slowdown in the economy. But the panel said its research had found "no significant relationship between the number of police and the rate of crime."

"While great numbers of police officers may deter muggings and similar random street crimes, police strength has little effect on the calculated, drug-related violence that is at the core of the district's crime problem," the study said.

Officer Gary Hankins, who heads the labor committee of the district's Fraternal Order of Police, took aim at the study even before Mrs. Rivlin introduced it.

"We know that today we're not dealing with people who are stealing loaves of bread to feed their families," Officer Hankins was quoted as saying in yesterday's Washington Times. "We're dealing with career criminals."

The commission's recommendation that the city be authorized to tax non-residents who work within it -- who earn about 60 percent of the total income earned in the district -- would require authorization by Congress.

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