The District’s $131-million fiscal wound is partially self-inflicted, after the city eliminated a once-mandatory rainy day fund.
In his Thursday proposal to trim the city’s budget, Mayor Adrian Fenty acknowledged that D.C. no longer was setting aside money in a so-called operating cash reserve. For years, Congress required the District to set aside tens of millions in case of economic crisis.
The mandate was lifted for this fiscal year and the fund merged into the city’s lawsuit judgments and settlements fund and no new funds were added, Fenty’s budget proposal states.
Asked about the rainy day fund at Thursday’s news conference, city administrator Dan Tangherlini blamed the city council for not funding the cash reserve.
“The council proposed actually just leaving the settlements and judgments fund,” he said. In any case, the rainy day fund wouldn’t have been enough, Tangherlini added.
“That would have gotten us $50 million,” he said. “We still would’ve had $81 million to go.”
Still, some increasingly vocal critics are wondering why the Fenty administration is struggling to stay ahead of crises.
“They seem to be in a very reactive posture,” said Councilwoman Mary Cheh, D-Ward 3. “I don’t think it’s so much about being caught off-guard as it is a practice of governing that says, Just deal with what’s in front of you. It’s not the best strategy when you’re dealing with potential shortfalls.”
