WASHINGTON — Mayor Muriel Bowser presented her proposed 2025 budget to DC Council on Wednesday, which prioritizes education, public safety, and downtown D.C.
D.C. officials say currently there is a $4 billion gap between resources and expenditures through Fiscal Year 2029, averaging out to $1 billion for the next four years. While D.C. revenue is growing by 2% per year, costs are growing at a more rapid 7.5% a year. DC officials say part of the deficit is due to people not returning to work in the city like before the COVID-19 pandemic.
D.C. officials say 70% of the 2025 budget is set aside for just 10 agencies:
- DC Public Schools: $1.4B
- DC Charter Schools: $1.4B
- Repayment of Loans and Interest: $1.2 B
- Department of Health Care Finance: $1.1 B
- Department of Human Services: $655 M
- WMATA $608M
- Metropolitan Police Department: $563M
- Dept. of General Services: $439M
- DC Fire and EMS: $295M
- Department of Behavioral Health: $283M
For the first time, the Office of Migrant Services will be funded using the operating budget, receiving $40 million. Previously, OMS was paid for using contingency funds. During the last budget, OMS spent $75 million and went from housing migrants at three hotels, now down to two hotels. They expect with an even lower budget next year, they will be down to one hotel.
The $21 Billion operating budget represents some deep cuts to city services. The $11.8 Billion Capital Investment funds pays for infrastructure and building projects like the Monumental deal
Jobs cut and programs eliminated
The proposed budget also includes several severe cuts to agencies, such as the Office of the State Superintendent of Education which is losing a total of $94 million. Additionally, a total of 480 DC Government positions will be cut. Sixty-nine of those positions are currently filled.
The Circulator Bus Program, which provides transportation to riders for just $1, will be completely eliminated as D.C. officials say ridership has not met pre-pandemic numbers. Eliminating this program will reportedly save the city $32 million. With WMATA experiencing a shortage of buses and drivers, the Circulator Bus Program contract workers and vehicles will be incorporated into the WMATA fleet.
"We couldn't save circulator but we were able to invest in WMATA," said Mayor Bowser during the budget hearing.
"The way people are moving around is changing," added City Administrator Kevin Donohue. "People are taking Metro bus, bike shares, and we've seen a lot of rentals for those stand-up scooters."
The Childhood Educator Pay Equity Fund was created in 2021 to achieve pay parity between early childhood educators and their K-12 counterparts. D.C. officials say Bower's proposed 2025 budget would cut the program, saving the city $70 million a year.
"It feels like we're balancing the budget on the backs of Black and Brown women in the child care sector," said an emotional At-Large Councilmember Christina Henderson. "We told them there is a future in childcare, go get your associates degree, go get your bachelor's degree and now we're going to tell them to go back to making minimum wage?!"
"If we say we care about children, then those who take care of children while families are out working should be a priority," said Ngeri Azuewah an advocacy manager at Bright Beginnings.
Azuewah joined about three dozen advocates who rallied on behalf of the Fair Budget Coalition.
Tasha Brown was there. She's the assistant director of Hill Preschool on Capitol Hill.
"A lot of us work for programs we could never afford with the salaries before the pay equity fund," explained Brown. "Teachers were making $75,000 a year which is life-changing. Some teachers could afford to become homeowners, other maybe get long overdue car repairs."
"We had some late-breaking gaps to fill in and were really left with few choices but a program of that size," said Mayor Bowser, "but I realize that is a priority for the Council."
While the Emergency Rental Assistance Program (ERAP) just reopened the application window on Monday, the program is poised to be cut down to a $20 million budget. According to the DC Fiscal Policy Institute, the ERAP received more than $30 million in the 2024 budget passed by the DC Council. The program helps residents earning less than 40% of the median income and facing housing emergencies by providing funding for overdue rent and court costs.
"The government can't keep paying people's rent," said Bowser in a heated exchange with Councilmember At-Large Robert White. "I think some people are taking advantage of rental assistance."
Rental programs are not the only housing assistance on the chopping block. D.C. officials also report that the Home Purchase Assistance Program (HPAP) will also decrease from $35 million to $28 million. And the Housing Production Trust Fund, a program that helps produce and preserve affordable housing in D.C., will lose 40% of its funding, going from $100 million to just $60 million.
"Some are burdened by pessimism. I am not," Bowser testified to the Council. "I will be a responsible steward of tax payer dollars but that should not stop us from thinking big."
"These sacrifices should be shared equitably," said Councilmember At-Large Kenyan McDuffie. "There appears to be some cuts to main streets (program) and I think it's important to understand what that means for those small businesses."
"I agree with Councilmember McDuffie's sentiments," added Ward 1 CM Brianne Nadeau. "It seems like we're doubling down on our investments in downtown when we're facing deep cuts elsewhere."
Funding increase for police and fighting crime
A major priority for the proposed 2025 budget is public safety, so funds will be increased for the Metropolitan Police Department, which will see an additional $70 million in their budget. That money will be used to fund new programs, including $8.7 million to add 40 new Community Safety Officers and civilian positions in order to make officers more available for crime-fighting tasks.
"Community officers is an innovative program, " said City Administrator Donohue, "it's not office jobs but jobs out in the community that doesn't involve police work - like helping someone write a police report."
Additionally, more than $3 million will be used to invest in crime fight technology, tasers, and software for license plate reads.
The Rapid Rehousing Program, a short-term subsidy program that helps people experiencing homelessness find affordable permanent housing, will see a budget increase of $30 million.
Taxes and Revenue
D.C. officials say the mayor has chosen to raise revenue instead of cutting more services and that property, residential, and income taxes won't be touched in the new budget. However, there will be an electric vehicle tax, which will depend on weight of the car and will vary from 1 to 3%.
According to D.C. officials, $167 million will be set aside for public safety and another $262 million will be used to enhance Downtown.
Officials say there are several plans to raise this money. One idea includes restoring the paid family leave tax, which was dropped to .26% and officials hope to increase it to .62%. This would be the largest tax increase in the entire plan and would raise $250 million annually for the general fund.
In July 2020, D.C. began administering paid family leave benefits. These benefits are taxable. The increase in the tax, which is paid by all employers in the city and will not impact employees, will be first used to fully fund paid family leave for a year, with the rest going to the General Fund.
Sales tax will also be increased in the proposed budget in an effort to support the Washington Metropolitan Area Transit Authority (WMATA). Currently, the sales tax is 6% but under the proposed budget that would increase to 6.5% in 2027 and then again to 7% in 2028. this increase would amount to $100 million annually, D.C. officials said.
Additionally, a brand new tax on hotels is proposed in the 2025 budget. D.C. officials say the 911 hotel tax would have visitors booking hotels in the District pay 80 cents per room, per night. The estimated $7 million this would raise annually would be used to support increased public safety efforts. The tax would not apply to AirBnB.
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