Image: Councilmember David Grosso, center
An exciting new bill from At-Large Councilmember David Grosso looks to get DC’s surplus funds moving for school improvements and affordable housing.
The bill, introduced last week, addresses one of the city’s self-inflicted wounds we wrote about a few weeks ago. As the city faces an affordable housing crisis, federal funding uncertainties, and more, it needs to have all options on the table.
Yet under current city law the District’s yearly budget surplus is required to be put into savings. This, along with DC’s overall fiscal strength, has contributed to a record-breaking general funds balance of $2.4 billion.
The portion of that designated as “cash on hand,” however, is just over a billion dollars. The city’s goal is to have 60 days’ worth of operating funds in reserves, and by current calculations they are about four “days” short.
Councilmember Grosso’s bill notes that the District is double-counting some of its debt obligations, and it would have the city move to federal bookkeeping standards. If this were done, the DC Fiscal Policy Institute estimates that it would result in $90 million becoming instantly available.
Under the bill, this money—and all future surplus funds—would be split evenly between the Housing Production Trust Fund (HPTF) and school improvements.
The HPTF is DC’s main vehicle for funding affordable housing projects, and a $45 million infusion would be a big help in meeting the city’s ongoing need. It would also provide crucial gap funding for current affordable housing projects impacted by declining low income housing tax credit markets. (Those interested can learn more about this here.)
HPTF money has helped thousands of Washingtonians find affordable housing, and increasing its budget is one of the best ways to keep life-long residents from being priced out of their city.
While Councilmember Grosso is currently the only sponsor, we hope to see other councilmembers joining soon. Rarely does such an easy and impactful fix come along.