Urban decay overwhelming nation's captial 'Everything is broken,'says district's chief financial officer


WASHINGTON - On any given day here in the capital of the richest nation in the world, nearly a third of the 16 water-pumping firetrucks are kept out of service to save money. Police officers dip into their own pockets to buy tires and put gasoline in squad cars. City clinics periodically stop testing for the AIDS virus because they cannot afford supplies. Local officials are dumping extra chlorine in drinking water to battle elevated levels of bacteria caused by eroding pipes.

The Washington of glittering monuments, world-class museums and graceful, leafy neighborhoods continues to captivate tourists, hordes of them. But in ways big and small, the Washington of cold municipal reality is falling apart.

Two decades into Washington's experiment in limited self-rule, the city is virtually insolvent.

Crime up, arrests down

Its bond rating is junk status. Its population, 706,000 just 20 years ago, has fallen to 554,000 - the lowest since the beginning of the New Deal in the 1930s. While New York and other cities have registered lower crime rates, here crime is on the rise, and arrests are down. City contractors wait months to be paid. Public school employees are facing up to 12 days of furloughs in the coming academic year to help trim the school system's $7.1 million deficit.

And the people elected to run the city, especially Mayor Marion S. Barry Jr., lost the trust of Congress, which has the constitutional power to oversee the national capital. Last year, Congress shifted much of the local power to a board of financial overseers, known locally as the financial control board, appointed by the president.

"Everything is broken," said Anthony A. Williams, the city's new chief financial officer. ""This isn't just a car that has run out of gas. There is something fundamentally wrong with the car. The gas pedal doesn't work, and neither do the brakes."

Major efforts are now under way to fix things. The control board is pressing local leaders to cut more spending and reduce the size of city government. Barry has introduced a ""transformation plan" to streamline the government. A White House task force has been formed to help city agencies improve services.

These efforts were rewarded in July when Wall Street offered to help the city raise $220 million in short-term notes, the first time in 18 months that investors have been willing to lend money to the city.

In Congress, momentum is gaining to pass legislation to create a flat federal income tax of 15 percent for district residents, a measure some lawmakers say would reverse the population exodus and encourage economic development.

But as federal and local officials strain to reverse the tumble into financial and physical decay, national lawmakers are beginning to suggest what was unthinkable just a few years ago: that Washington's hard-won right to govern itself should be stripped away.

After 100 years of being ruled through Congress, the district accepted a limited form of independence that is now under attack.

"The control board is the city's best hope to retain home rule," House Speaker Newt Gingrich said recently. "If the politicians stop that control board from succeeding, I think it puts into doubt the whole issue of home rule."

The issue of home rule has special racial and historical poignancy here in Washington, a black-majority city that had long been denied political independence by the white federal establishment.

And while, in many ways, Washington's problems are similar to those of other large and aging American cities - increasing poverty, rising crime, middle-class flight - Washington is not just any American city. It is the capital, with all the symbolism of great expectation that such a lofty status implies.

"Washington, D.C., is the political center of the universe as we know it, and people could not believe it was bankrupt," said Rep. James T. Walsh, R-N.Y., who is chairman of the House subcommittee that oversees Washington's budget. ""I was doing interviews with German, British, French and Australian TV outlets. They are astounded by it. How could this happen?"

It happened for a complex mix of reasons. But in the end, the prescription for failure was really quite simple: In granting Washington home rule, Congress imposed a bad financial and political deal on the city, and local leaders succeeded in making it considerably worse.

In their zeal to gain even limited independence, city leaders accepted numerous economic and political shackles on the government's ability to function:

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