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After more than five years critiquing D.C.’s fiscal and budgetary policies, Ed Lazere has convinced the city’s leadership of at least one thing: He’s a darn good guy.
“He does good things.”—D.C. Council Chairman Linda W. Cropp.
“I’m delighted that he’s there.”—Ward 3 Councilmember Kathy Patterson.
“He’s doing God’s work.”—D.C. Chief Financial Officer Natwar M. Gandhi.
Lazere’s work, divine or otherwise, is in high season right now at the John A. Wilson Building, where this week Mayor Anthony A. Williams submitted his fiscal year 2005 budget plan. As head of the D.C. Fiscal Policy Institute, a project of the nationally known and left-leaning Center on Budget and Policy Priorities, Lazere spends his spring enumerating the various ways that the proposed budget shortchanges D.C.’s low- and moderate-income residents.
If you think of the annual budget battle as a municipal version of March Madness, Lazere takes on the role of college basketball maven Billy Packer.
Indeed, Lazere’s color commentary on the D.C. budget is almost as controversial as Packer’s bashing this year of St. Joseph’s. Despite the accolades, almost all who praise Lazere down at the Wilson Building find some fault, as well. “I have a big problem with him,” says Gandhi, who disputes the assumptions and numbers in Lazere’s recently released budget analysis.
On Monday, Lazere stood in the back of the mayor’s press briefing room wearing “A Fair and Just Budget For All” sticker on his shirt as Mayor Williams recited his 2005 budget
priorities: a universal pre-kindergarten incentive program, modernization of schools, police deployment to crime “hot spots,” and so on. All laudable and costly, of course. So one of the points the mayor addressed—in a colorful and easy-to-comprehend pie chart that even reporters who don’t work for the Bond Buyer might be able to grasp—is how D.C. spends its money.
To the untrained eye, D.C.’s neediest and most vulnerable residents get a sweet piece of the pie in Williams’ proposed $6.25 billion budget. After all, the category of “Human Services” occupies the largest chunk of space, at 30 percent of the budget, followed by “Education” at 25 percent and “Public Safety” at 18 percent. “Public Works” takes up only 7 percent, by contrast.
Lazere argues, however, that the social-services tranche is most susceptible to budget raiding. “The other big parts of the budget are so protected,” argues Lazere. “The only major program area people consider reducing is the social-services side of the budget.”
In anticipation of this annual rite of spring, Lazere disseminated his own analysis of D.C.’s budget, titled The Untold Story of the D.C. Budget: Overall Spending Has Grown Only Modestly Since 1990 but Support for Services to Low-Income Residents has Fallen Sharply. Adjusting for inflation and a few other important factors, Lazere compared the city’s spending in 1990 with that of the current fiscal year. The 27-page report counterintuits D.C. budget conventional wisdom. “In recent years, our leaders have argued that spending on social services has been the source of our budget problems,” says Lazere about his report, co-authored with Idara Nickelson. “In fact, our research shows the opposite: that some of the services supporting our neediest residents have been cut.”
That conclusion made front-page news at the Washington Times last week, as well as stories in other local media outlets.
Despite the headlines, Lazere hasn’t made too much headway bringing D.C.’s financial guardians around to his point of view. Gandhi, for one, takes issue with Lazere’s numbers, as well as his minimization of the budgetary impact of skyrocketing Medicaid costs. And fiscal conservatives on the council, such as Ward 2’s Jack Evans, say that, even though they respect Lazere’s work, they believe that pre–Revitalization Act budgets shouldn’t be control variables in the current fiscal climate.
As chair of the council’s Committee on Finance and Revenue, Evans holds a lot of sway over his colleagues on fiscal matters. He and fellow tax-cutter At-Large Councilmember David A. Catania shepherded through the Tax Parity Act of 1999, a measure to lower the District’s high personal-income-tax rate. Tax parity was suspended in 2002 .
Lazere clashed with the council’s tax-cutting adherents earlier this year in the debate over lowering the property-tax-rate cap. Because of the city’s economic renaissance and a switch to annual assessments, D.C. homeowners had started to see whopping property-tax bills. Evans and Catania proposed a property-tax-rate cap of 10 percent to insulate homeowners against skyrocketing payments to the D.C. treasury.
Lazere and the D.C. Fiscal Policy Institute cautioned about the proposal’s revenue impact on the city and responded with an analysis of who stood to gain from it. Lazere concluded that wealthy District homeowners would disproportionately benefit from the cap, while low- to moderate-income homeowners would be helped substantially less.
That kind of substantive number-crunching helped generate an alternative to the Evans/Catania plan. After examining some of Lazere’s data, At-Large Councilmember Phil Mendelson proposed a 20 percent property-tax-rate cap combined with a raise in the homestead exemption. Mendelson argued that his proposal helped low- and moderate-income homeowners more. He even passed out Lazere’s numbers on the dais.
That forced Evans and Catania to compromise: The council ended up passing a 12 percent cap and raised the homestead exemption from $30,000 to $38,000. “[Lazere] helps put numbers to policies that a lot of District of Columbia residents support,” says Ward 4 Councilmember Adrian M. Fenty, who often cites Lazere’s numbers as well. “You can’t get better management by just cutting the budget.”
Evans sees the District’s fiscal problems differently: The city needs to curb spending. “I am extremely concerned about a 9 percent growth rate in expenditures,” said Evans when the mayor formally presented his plan to the council Monday afternoon. Increasing fees or taxes might take care of the budget problem this fiscal year, he noted. But they would place a tremendous burden on city residents. And what would happen next year?
Lazere doesn’t dispute that D.C. residents have a tremendous tax burden. He’s not a willy-nilly tax-and-spender, he insists. Lazere counters with this point: High taxes are not the main reason residents complain and flee the District. Poor service delivery is.
Keeping homes affordable for D.C. residents is also central to Lazere’s budget agenda. “Local funding for affordable housing programs is $26 million in 2004, 54 percent less than in 1990, when $56 million in local funds was spent on housing,” Lazere cites in his report.
A few years ago, the Williams administration proposed a solution: the Housing Production Trust Fund. The mayor proposed putting 15 percent of deed-recordation taxes collected every year to fund affordable-housing projects. Under that formula, which is now law, the fund was slated to receive $ 40 million this year.
Within his fiscal year 2005 budget, Mayor Williams has proposed “securitizing” the fund. What Williams wants to do is this: Make a one-time lump-sum payment of $275 million to the fund. “Money is more valuable today than it is 20 to 25 years from now,” argued Williams. “It’s worth something, ladies and gentleman, to have that money now.”
“That’s ridiculous,” Lazere muttered.
Lazere is clearly moving debate at the council, to judge from the folks he’s annoying. During the property-tax-cap discussions, Catania spent his time at a Jan. 13 council hearing challenging Lazere himself—specifically whether his advocacy exceeded lobbying restrictions on 501(c)(3) nonprofits. “You always claim that there’s not enough money in the till,” Catania told Lazere. “We wouldn’t want to leave the impression that individuals are contributing lobbying and political monies to a nonprofit, therefore cheating the government of its share.” Catania then dashed off a letter to Lazere’s boss, Robert Greenstein.
Greenstein refuted Catania’s argument in a letter a few days later. “While the Center’s focus is national in scope, the DCFPI project conducts research and public education on budget and tax issues in the District of Columbia—as well as projects on the Earned Income Tax Credit—with a particular emphasis on issues that affect low-and moderate income residents.”
Lazere insists that the vast majority of his work is educational, nonpartisan research and analysis. He does some individual lobbying with councilmembers that is well within the law, he says. “I know what lobbying is and what it isn’t,” says Lazere.
AT-LARGE RACE POTPOURRI
•At-Large Councilmember Harold Brazil was No. 1 on the witness list for last Thursday’s Metro-fare-hike meeting. When Brazil spoke into the microphone, however, the councilmember told those in attendance he planned to speak out against all Metro fare increases at the meeting the following Monday.
That night’s meeting would be chaired by Metro board member and Ward 1 Councilmember Jim Graham, who has announced an exploratory campaign to challenge Brazil for his at-large seat.
“We don’t see Harold very often at Metro,” Graham tells LL.
Brazil testified Monday, as promised, that he opposed any kind of fare increase. “I am very disappointed that Metro seems so eager to place the responsibility of its spending increases onto the residents of this city—rather than looking to itself to find ways to cut costs,” he told his likely opponent. “I believe that these fare increases, at least in part, are being used to pay for mismanagement by the past leadership of Metro.”
Graham says he voted against a fare-increase package because it raised the cost of bus rides. “I’m not against all the fare increases,” Graham says. “If you eliminate all fare increases, then you have to cut services.”
• The prospective field of candidates for this fall’s Ward 8 council race has some interesting answers to the question: For what are you known?
First, there’s announced-by-everyone-but-himself candidate Marion S. Barry Jr.
Then there’s Eugene Dewitt Kinlow. The Ward 8 Dems president’s name recognition soared after his organization’s first vice president, Mary Cuthbert, labeled a fellow Ward 8 Dem “white trash.”
And now the Rev. Carlton N. Pressley looks likely to throw his hat in the ring. The city’s former senior adviser for religious affairs, Pressley departed the Williams administration after questions arose about his professional as well as his personal conduct. “If the people have their way, I will be announcing in a few weeks,” Pressley tells LL. “There’s no ordained minister on the city council. I think that needs to change.”
Pressley says he supports an amendment banning gay marriage and is in favor of prayer in school.
“I’m glad that so many people are interested, but no one has sat down and talked with me about challenging this seat,” incumbent Sandy Allen tells LL. Allen says she plans on running a vigorous campaign against whoever makes the ballot. Other rumored candidates include Williams-administration staffer Lafayette Barnes, Ward 8 Dem Jacque Patterson, and D.C. Taxicab Commissioner Sandra Seegars.
“It’s going to be fun,” says Patterson. —Elissa Silverman
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