Staff Reports
The District of Columbia Council has granted preliminary approval for the budget for the upcoming year, which involves implementing tax hikes and rolling back certain proposed significant program reductions. The first vote, held on Wednesday, marked the initial of two rounds, with the second slated for June 12, prior to forwarding the proposed budget to Washington Mayor Muriel Bowser.
Council Chairman Phil Mendelson and Bowser are in accord regarding the necessity for program reductions and tax hikes to tackle the district's $700 million budget shortfall. However, they hold differing views on which programs to trim and which taxes to elevate.
Within the sanctioned proposal, Mendelson proposed an increase in the property tax rate for single-family residences and condominium units valued over $2.5 million, impacting approximately 2,800 households.
DC leaders agree to raise taxes and cut programs to address $700 million deficit https://t.co/7sC6Q8OrtW
— Washington Examiner (@dcexaminer) May 31, 2024
He additionally suggested an amendment to augment the tax imposed on businesses contributing to the Paid Family Leave program and to restore $70 million to the Early Childhood Educator Pay Equity Fund, originally slated for reduction in Bowser’s proposal.
Mendelson’s budget proposal also reallocates $25.4 million to schools, adds $3.5 million for new teaching positions, increases housing vouchers to 477, and boosts funds for emergency rental assistance and homelessness prevention services. It also restores Access to Justice’s budget to $31.7 million, reversing cuts from Bowser’s proposal.
Bowser cautioned that Mendelson’s proposal would impose $530 million in new taxes and fees on taxpayers. While Bowser's suggested tax increases include raising the sales tax from 6% to 6.5% in fiscal 2026, escalating to 7% in the subsequent two years, the chairman's strategy aims to generate around $100 million in city revenue through new taxes.
