D.C. budget proposal leaves out tax hikes

D.C. Council Chairman Kwame R. Brown indicated on Monday he will deliver a fiscal 2013 budget plan that does not impose new taxes or fees — a feature that Mayor Vincent C. Gray emphasized in his blueprint for the council — but does tweak a proposal to expand alcohol sales at bars and taverns across the city.

Mr. Brown’s staff worked throughout the day to circulate the chairman’s budget before the full council’s legislative session on Tuesday morning. Council members are slated to vote on the plan and then affirm their votes in a second meeting on June 5.

A primary point of contention has been Mr. Gray’s plan to allow bars to stay open for an extra hour every day to raise $3.2 million.

Council member Jim Graham, Ward 1 Democrat who oversees alcohol regulation as chairman of the Committee on Human Services, opposed the plan and suggested a higher excise tax on alcohol to cover the budget gap and raise additional money for social services.

Mr. Brown said on Monday he will go forward with a compromise, first floated last week, that would raise nearly $2 million through expanded bar and restaurant hours and reallocate $1.2 million in specific-purpose revenue to cover the $3.2 million needed to forgo the mayor’s plan and the higher excise tax.

Mr. Brown’s plan would allow bars to stay open until 4 a.m. and restaurants to serve around the clock during the week of the presidential inauguration in January, on seven federal and D.C. holidays, and on four specific holiday weekends - New Year’s Day, Memorial Day, Independence Day and Labor Day. The chairman’s fiscal calculation accounts for the fact that New Year’s and July 4 do not fall on weekends in 2013.

But Mr. Graham has not wavered in his opposition to bonus time for booze.

“I can’t support extended hours,” Mr. Graham said Monday of the chairman’s compromise. “I know 19 days is better than 365 days, but it’s still 19 days.”

Mr. Graham said he knows the chairman might whip up the votes for the compromise, but he has not abandoned his excise tax proposal. If he cannot find support for the tax among his colleagues, he said, “that’s not going to work, either.”

In another budget sideshow, council member David A. Catania, at-large independent and chairman of the Committee on Health, received a stamp of approval from Chief Financial Officer Natwar M. Gandhi to cover hospital care for members of the D.C. Healthcare Alliance, which serves non-Medicaid, eligible residents, many of them immigrants.

Mr. Catania’s staff said he located the roughly $20 million needed to restore the coverage, which had been cut in the mayor’s budget plan. He tweaked the plan so that it does not affect disability services, a point of contention from the mayor’s camp after the council member released his initial plan last week.

The CFO-certified figures are slightly different from the savings Mr. Catania’s office previously outlined, but still come from higher-than-anticipated revenues and a re-evaluation of reimbursement rates within the Department of Healthcare Finance.

Mr. Gray ratcheted up discord between his administration and Mr. Catania’s committee with a lengthy statement on Monday afternoon that condemns the council’s recommendations as wasteful and inadequate to protect care.

Mr. Catania’s spokesman said those accusations were misguided and based on the prior plan.

Meanwhile, the long, tortured path toward using fiscal 2012 funds to compensate city workers for four furlough days will get a little longer, as the D.C. Council focuses on the upcoming year’s budget instead of taking up the issue on Tuesday.

Labor unions had been counting on city lawmakers to pay city workers for the quartet of unpaid holidays they took in 2011 as part of cost-cutting measures, only to see the city obtain a $240 million windfall in revenue by the end of the year.

Council staff suggested the issue would likely coincide with revised revenue estimates in June, so the city knows how much money it has to devote to members’ priorities.

Mr. Brown confirmed that the full body will take up the furlough issue at its regular legislative session on June 5.

“Right now, the chairman is focused on the FY 2013 budget process,” spokeswoman Allison Abney said. “Once the council successfully moves forward and completes the process, other matters will be addressed.”