DC Council proposes tapping rainy day fund to restore social spending
DC Council proposes tapping rainy day fund to restore social spending
D.C. Council Chairman Phil Mendelson unveiled a proposal Tuesday to use $150 million from the District’s reserve fund as the council prepared for its first votes on the fiscal 2027 budget.
WASHINGTON - D.C. Council Chairman Phil Mendelson unveiled a proposal Tuesday to use $150 million from the District’s reserve, or "rainy day," fund as the council moved toward its first votes on the fiscal 2027 budget.
The plan would restore hundreds of millions of dollars in social spending cut from Mayor Muriel Bowser’s proposed budget as lawmakers begin considering initial budget votes.
What we know:
The proposal comes ahead of the council’s initial budget votes and would restore roughly $400 million in funding for programs including child care assistance, housing vouchers, paid family and medical leave benefits and health care coverage for low-income residents.
What they're saying:
Mendelson said the changes are needed to maintain services he argued are essential for residents facing ongoing economic pressure.
"The chief financial officer estimates that, as the current-year reserves show, there’s in fact no decline in our revenues for the current fiscal year, so our revenues are stable this year and growing in each subsequent year of the financial plan," Mendelson said during budget deliberations.
The other side:
The plan has drawn warnings from Chief Financial Officer (CFO) Glen Lee, who cautioned that tapping the reserve fund could weaken the District’s fiscal position by reducing its ability to respond to future economic downturns.
Dig deeper:
The disagreement underscores tensions over how to balance restoring social programs with maintaining long-term budget stability.
Council members expressed differing views during Tuesday’s discussions.
Councilmember Janeese Lewis George defended the restorations, saying the council should not accept deep cuts as inevitable.
Councilmember Matt Frumin pointed to the difficult tradeoffs facing the mayor’s budget proposal, while Councilmember Zachary Parker urged colleagues to take the CFO’s concerns seriously as the process moves forward.
What's next:
A spokesperson for Mayor Muriel Bowser said the mayor is expected to send a letter to the council this week addressing the budget changes.
Under District law, the mayor will have 10 days to act on the spending plan once it receives final approval from the council, which is expected later this month.
The Source: Information from the Council of the District of Columbia, Mayor Muriel Bowser's proposed budget and FOX 5 D.C. reporting.