Washington, D.C. – Mayor Muriel E. Bowser is facing a daunting $4 billion budget shortfall over the next four years, prompting significant program cuts and tax hikes in her $21 billion proposed budget. The fiscal challenges are some of the toughest Bowser has encountered during her tenure, with the pandemic wreaking havoc on the city’s finances.
With federal pandemic aid running out and commercial vacancies affecting city revenue, Bowser’s administration is looking at ways to address the growing budget hole. To close the gap, the proposed budget includes around $500 million in cuts to city programs, such as the elimination of the Circulator bus and the Early Childhood Educator Pay Equity Fund.
Bowser’s budget, titled “Strategic Investments and Shared Sacrifice,” aims to balance the cuts with targeted investments in downtown revitalization, education, and public safety. The Mayor also plans to increase the sales tax gradually to help cover the rising costs of the region’s public transit system.
In addition to program cuts and tax increases, the budget includes new revenue sources, such as a fee on hotel bookings to support the 911 call center and an increase in the tax that businesses must pay towards the Paid Family Leave program. Bowser is hopeful that these measures will help reverse the current budget constraints in the future.
Despite the challenging fiscal situation, Bowser is prioritizing significant investments in public education, public safety, and downtown development. The budget allocates funds for additional civilian positions in the police department, expanded services for detained youth, and efforts to enhance public safety through the newly passed Secure D.C. crime bill.
Furthermore, the proposed budget includes investments in education, including a boost in per-pupil funding and expansions of career readiness programs. Bowser’s focus on downtown development is evident through funding for streetscape projects, tax incentives for converting office spaces, and efforts to attract businesses to the area.
While the budget includes tough decisions like eliminating positions in District government and cutting the Housing Production Trust Fund, Bowser remains committed to addressing the city’s economic challenges. The Council plans to hold hearings and make their own changes to the proposed budget before finalizing the fiscal 2025 budget package in late May.