Mayor Vincent Gray said he will sign the $5.8 billion budget passed by the D.C. Council last week despite the absence of a tax hike included in his budget plan.
Chairman Kwame Brown’s (D) budget swapped out Gray’s proposal to increase taxes by 8.9 percent on residents who earned above $200,000 for an out-of-state municipal bond tax. The swap was reported to raise $13 million, according to Brown.
Gray warned the Council that the bond tax would impact the investment portfolios of retirees that live on a fixed income, but said even if the tax was included in the final budget, he would still approve the measure in an effort to work in a “collaborative manner.”
“If the Council ultimately decides to swap the bond tax increase for the income tax increase, it is not a change that would prevent me from supporting the budget,” Gray stated in the press release.
A recent poll showed that D.C. residents support a tax increase among high earners in order to preserve funding for education, public safety and human services, the D.C. Fiscal Policy Institute reports.
A poll conducted by Peter D. Hart Research Associates, taken on April 20-22 of 504 likely voters, showed that 70 percent of respondents said that it is more important to “preserve services than to hold down taxes,” the Institute reports. D.C. voters supported the tax increase with 85-14.
Ed Lazere, executive director of the D.C. Fiscal Policy Institute, said residents do not like a “cutting” policy.
“D.C. residents agree that modest tax increases on those making more than $200,000 and those who use parking garages are reasonable steps to take so that the city does not have to reduce spending on schools, social services, and public safety,” he said on the organization’s website. “The public clearly recognizes the need to invest in creating good jobs and a strong economy. People reject the idea that an approach focused only on cutting services makes sense.”
With a $322.1 million budget gap, Gray’s attempted to close the deficit by slashing funding from social service programs and $18 million from the Housing Production Trust Fund, which provides money to those who need affordable housing.
When people were shown the specifics of Gray’s program, they said that his proposed budget went too far in cutting programs, especially services for “those most in need of help.”
Brown’s budget proposal would put money back in the coffers of social services programs, with a $23.4 million allocation to homeless shelters. The Martin Luther King Jr. Memorial Library would stay open on Sundays and the number of police officers would increase.
The Council will vote on the final budget June 14, and the budget will go into effect Oct. 1.