Monica Bell, Liman Fellow

The D.C. Council held its first vote on the Fiscal Year 2012 budget on May 24, 2011. (For more on the process, see the D.C. Fiscal Policy Institute’s FY 2012 Budget Toolkit.) The Council’s budget makes several changes to the Mayor’s proposal that affect both revenue-raising measures and expenditures on safety net programs. 

Perhaps the most notable change in revenue enhancement measures was the Council’s decision to abandon Mayor Gray’s proposed 0.4% income tax increase on individuals earning more than $200,000 per year. The Council decided instead to adopt a measure that Legal Aid has endorsed on multiple occasions: eliminating DC’s exemption on interest collected from out-of-state bonds. At the beginning of this budget season, only D.C. and Indiana exempted interest earned on out-of-state municipal bonds from taxation.  The Indiana Legislature voted to end their exemption in early May, and the D.C. Council followed suit on May 24.  Although this measure raises less revenue than the proposed income tax, it (along with other changes to the revenue distribution scheme explained here) allowed the Council to give some support back to the hardest-hit safety net programs. 

TANF:  The Council voted to restore $4.9 million to TANF, which would avoid additional time-limited cuts for FY 2012. The Budget Support Act, the subject of the second vote on June 14, still includes benefits cut to begin in FY 2013.

Homeless Services:  The Council voted to restore roughly $17 million to the budget for Homeless Services. 

Interim Disability Assistance (IDA): The Council added $1.5 million to preserve IDA. The District is currently reimbursed about 40% of the money it spends on IDA – a high percentage relative to other states, but an amount that has come under the Mayor’s attack.  Under the May 24 budget, the Department of Human Services must review the IDA program to see if there are ways to increase IDA’s reimbursement rate. Although the Council has allocated some money to IDA, it is only enough to serve about 500 residents – less than one-half of the current IDA recipients. The Council voted to add additional funding to IDA if revenues in DC increase above the currently projected amount. 

Even with these restorations, a significant amount of the District’s budget cuts still fall on the most vulnerable communities. In addition, there are lingering indicators – such as the review of IDA and the continued enthusiasm for a time limited approach to the broken TANF program – that safety-net advocacy will remain vitally important during the next budget cycle. Nonetheless, the Council should be commended for its efforts to preserve and improve the safety net, and for its commitment to strengthen some safety net programs with additional revenues. If the Council were to restore the modest income tax increase and include the elimination of the bond exemption, the social safety net would be in far better shape. 

The final budget vote, which will solidify legislative changes through the District’s Budget Support Act, will be held on Tuesday, June 14.  At this point, the amount of money available in the budget is finalized, but the allocations of funds can still change. Thus, we urge you to reach out to your Council Members and encourage them to consider restoring the modest tax increase and do all they can to maintain the restorations to safety net services that are critically important to our client community.

For more information about the first budget vote, see:

D.C. Fiscal Policy Institute – The DC Budget Vote: So What Happened?

Washington Legal Clinic for the Homeless – Shelter System Crisis – Averted!

DCist – 2012 Budget Passes Council on First Vote

Washington Post – Upper-income residents in D.C. won’t face higher tax rate

Related Making Justice Real  blog posts:

Legal Aid Expresses Profound Concern about Disproportionate Budget Cuts

TANF Time Limit Would Put Survivors of Domestic Violence at Risk

Proposed Change to D.C. Healthcare Alliance Would Erect High Barriers to Health Coverage

D.C. Budget Would Suspend Interim Disability Assistance

Mayor Gray’s Proposed Budget Cuts Would Hit Legal Aid Clients Hard

Join Legal Aid and Other Organizations in Urging the Mayor to “Invest in DC”

Eric Angel, Executive Director

An interview with DC Access to Justice Commission Chair, Legal Aid Servant of Justice Award Recipient, and Georgetown law professor Peter Edelman was featured in a recent issue of The Nation magazine.  Edelman describes patterns in federal anti-poverty policy since the 1960s and how certain aspects of poverty are different now than they were in earlier decades.

Particular pertinent to the current budget debates in D.C., Edelman explained why policymakers should not focus solely on low-wage work while undermining the social safety net:

Extreme poverty is a separate question from low-wage work.  These are people who—if they have any work at all—it’s very episodic, seasonal, part-time.  They may live somewhere that’s too far from a job, they may be not very good candidates for work, they’re clinically depressed, they have no skills, they are a victim of domestic violence, maybe they are caring for a child or parent with an illness—there are all kinds of reasons why they have almost no earnings.  And we’re not facing up to that problem. (emphasis added).

 Read the full article, “US Poverty: Past, Present and Future,” here.

Monica Bell, Liman Fellow

As Mayor Gray prepares to present his FY 2012 budget on April 1, advocates for the low-income community are again concerned that the safety net, already weakened, will be decimated by further cuts this year.  The District is projected to face a shortfall of about $322 million.  If past behavior is any indication of the future, advocates have reason to be concerned.  In recent years, the District’s primary strategy for dealing with the budget shortfall has been cutting millions of dollars for critically important services to the District’s most vulnerable.  TANF, Interim Disability Assistance, homeless services, affordable housing, childcare services, mental health services, adult education, domestic violence resources, and others have all been subjected to the axe.  Candidate Gray recognized this, noting that “We have not only cut to the bone, we are down to the bone marrow.”  Even so, an additional $30 million was cut from the FY 2011 budget for services to low-income District residents, those who most acutely feel the impact of program cuts.

Legal Aid has joined 60 other organizations in signing on to the “Invest in DC” initiative, led by Save Our Safety Net, the Fair Budget Coalition, the Metro Washington Council of the AFL-CIO, and DC Jobs with Justice. We urge the Mayor to take a balanced approach to dealing with the budget shortfall by making reasonable efforts to increase the District’s revenue.  The “Invest in DC” approach would raise $150 million in progressive revenue by:

(1)   Increasing the income tax rate on the wealthiest, which currently places the same rate on a family making $1 million per year the same as a family earning $40,000 per year;

(2)   Ending the District’s tax exemption for interest paid on out-of-state bonds, which would bring DC’s practices in line with those of 49 out of 50 states; and

(3)   Increasing taxes on parking, a burden that would fall substantially on commuters and tourists.

If we are to truly be “One City,” we must ensure that the burden of the budget crisis does not fall primarily on certain wards and certain communities, but rather is shared across the District.

We need your help to carry this message to Mayor Gray.  There are two major ways you can participate this week:

(1) Call the Mayor on Tuesday, March 22 to challenge him to raise $150 million in progressive revenue and invest it in DC. Call the Mayor’s Community Affairs Office at (202) 442-8150.  You can also email the Mayor at vincent.gray@dc.gov. Contact mbell@legalaiddc.org to get a sample email or phone script for the March 22 calls.

(2) Participate in Save Our Safety Net’s “Lunch with the Mayor Initiative” this week. Join Save Our Safety Net and allies at the Wilson Building, 1350 Pennsylvania Ave. NW, to demand a meeting with Mayor Gray to discuss the upcoming budget every day this week at 1 PM.  Remember to bring your ID and a brown bag lunch (except for Friday, March 25). RSVP to sos.adf@gmail.com.

Eric Angel, Acting Executive Director

In recent days, we reached out to the Legal Aid community regarding the disturbing budget cuts proposed by Mayor Fenty in his Gap Closing Plan for FY2011.  Among other things, the plan proposed to cut the Access to Justice Grant Program – which supports civil legal services for indigent District residents and the Community Legal Interpreter Bank – by more than 50% of the level appropriated by the Council this spring.  It also proposed reducing funding for the Loan Repayment Assistance Program, which helps legal services lawyers to manage otherwise crushing educational debt.  I testified before the Council regarding this issue. In an extraordinary show of support, Chief Judge Eric Washington of the D.C. Court of Appeals, Chief Judge Lee Satterfield of the Superior Court, D.C. Bar President Ron Flagg, and the head of the Access to Justice Commission, Peter Edelman, all came down personally to the Council to oppose the cut.  Many Legal Aid Board members and friends of Legal Aid reached out to the Council via email or telephone.

These extraordinary efforts paid off:  in a day otherwise marred by deep cuts to social services in the District, the Council voted to restore most of the cuts the Mayor had proposed to Access to Justice funding.  Specifically, it appears that Access to Justice grant’s level was restored to $2.951 million and LRAP was fully restored to $221,000.  This represents a 10% cut to the Access to Justice grants program, as opposed to the over 50% cut that was proposed.

Legal Aid has also been heavily involved in advocacy regarding the spending cuts proposed that affect our client community directly, including a misguided cut to the TANF payments.  Our Liman Public Policy Fellow Monica Bell testified before the Council.  Here, our advocacy efforts were very challenging (and vastly less successful).  On Tuesday, December 7, the D.C. Council significantly altered the District’s welfare policy by essentially adopting a time limit for TANF receipt.  By February 2011, the District will reduce benefits to families who have received TANF for more than 5 years by 20%.  The benefit reduction will increase by 20% each following fiscal year until they are no longer receiving any cash assistance.  That means that a family of three now receiving $428 per month in cash assistance will receive $342 per month in FY2012, $257 per month in FY2013, $171 per month in FY 2014, and just $86 per month in FY2015. The FY2011 change will affect over 7,000 District families.  Unlike other jurisdictions with welfare time limits, the District does not exempt especially vulnerable populations, such as survivors of domestic violence, those caring for disabled family members, or recipients over the age of 60.  Half of the predicted savings will be reinvested in D.C.’s job training programs.  We are very concerned about the real, practical effects of these cuts and will be working on responses in the coming days, weeks, and months.

Eric Angel, Acting Executive Director

The Mayor’s Gap Closing Plan for FY 2011, announced less than two weeks ago, slashes funding for a number of critical safety net programs.  Temporary Assistance to Needy Families (TANF) funding has been cut by $4.6 million by  reducing benefits to families who have been on the program for more than 60 months by 20%.  A family of three would go from receiving $428 per month to just $343.  Interim Disability Assistance (IDA), the District’s support system for those who are disabled and unable to work, is subject to a potential $1.2 million cut.  The Grandparent Caregiver program, which provides funds to low-income elderly persons who are caring for their grandchildren, has been slashed by fifty percent.  The Access to Justice Grant Program, which supports civil legal services for indigent District residents and the Community Legal Interpreter Bank, has also been slashed by more than fifty percent.  These cuts will jeopardize the District’s increasingly fragile social safety net in a time when need has drastically increased.

At the same time the budget proposes to erode the social safety net, it contains no major initiatives to increase the District’s revenues through reasonable tax increases.  Legal Aid has endorsed the “Better Choices” initiative, urging the Council to take a balanced approach to the budget shortfall.  We realize the unavoidability of budget cuts given the extent of the shortfall, but we also recognize that the District’s low-income community should not bear the burden of this crisis alone.

The Council will vote on the FY 2011 Budget on Tuesday.  Each Council member needs to hear from you – right away – about the devastating impact these cuts will have on vulnerable District residents.

Call and/or email Council members today to urge them to take a balanced approach to the budget crisis. Ask them to preserve funding for needed safety net programs and access to justice funding as much as possible, and to enhance revenues through reasonable, progressive tax policy.  These efforts can make a significant difference for our client community.

Jennifer Mezey, Supervising Attorney

Legal Aid is one of more than a dozen blogs participating in this year’s Thanksgiving Blog Blitz. Since we often criticize the way the government serves our client community, it is imperative to remember the things we are thankful for about the way the DC government has systems in place to help the most vulnerable among us.

I, for one, am thankful that the District has a TANF program so that there is a safety net for the District’s most vulnerable families with children. When parents lose their jobs and can’t qualify for unemployment insurance, when a woman is fleeing her abuser and when a father is waiting for his SSI application to be approved, there is a program that will make sure that their family is not utterly destitute. The program should be improved so that it can better help parents who can work become employable and provide better linkages to supports for parents who cannot work. We have clients at Legal Aid who are pursuing education and training opportunities and need the TANF program to better support them as they work to improve their skills. And we have clients who are struggling with disabilities that have not been acknowledged and accommodated by the TANF program. But the District is working to improve these aspects of the program, and we will hopefully see better outcomes for children and families as these changes are implemented. The bottom line is that TANF is an important part of the safety net for the District’s families and it must remain intact for the families who need it.

The DC Council will decide in the coming weeks how to fix a $175 million budget shortfall. Rather than relying solely on more cuts, it is time for a balanced approach that includes progressive revenue streams. Right now DC’s top tax rate (8.5%) starts at $40,000 a year. City leaders should create a new top tax bracket (of 1% more than the current rate) for income over $200,000. The revenue raised can help preserve the programs we are thankful for.

Please look at the Save our Safety Net website for more information . 

Other Blog Blitz Participants:
Beyond Bread

Today, the District of Columbia Council is holding hearings on funding for the Office of the Attorney General.  Funding for legal services is a line in the Attorney General’s budget.  The funds are placed in a grant program that is awarded to the D.C. Bar Foundation and then distributed to legal services providers.  These funds support community basing of services, language accessibility and loan forgiveness for poverty lawyers.  [Legal Aid's Testimony availabe here.]

The District has a very challenging set of choices to make.  With a $500 million budget gap, something must give.  We have been encouraging the Council to save the social services safety-net, including legal service and to look at revenue options as a way to spread the pain equitably.  (Significantly, yesterday the Ward 6 Democrats adopted a resolution supporting funding for safety-net programs and encouraging an increase in income taxes).

Why? Because the Mayor's proposed budget for FY2011 makes cuts to vital programs like child care vouchers, adult job training, and domestic violence services. Our safety net is already in tatters, after more than $100 million in cuts in the last two years. We can't afford to cut any more.  

What? Rally in front of City Hall. Hear Councilmembers speak at the rally about their plans to save the safety net through progressive revenue proposals. Visit Council offices to show the community is behind safety net programs.  WEAR RED!!! 

When? 11:30-1:00 Wednesday, May 5th 

Where? 1350 Pennsylvania Ave NW. Close to Federal Triangle (orange/blue) and Metro Center (red, orange/blue).

Please contact Kristi Matthew to RSVP and get additional information: Kristi@legalclinic.orgor 202-328-1262.

Note: We will not hold a Fair Budget general membership meeting that day.

Joni Podschun

Campaign Manager, SOS-DC
202-553-7248

@SaveDCSafetyNet

There is a movement underway to take a different approach.  The Fair Budget Coalition; the D.C. Fiscal Policy Institute,  Save Our Safety Net campaign, and Think Twice Before You Slice Campaign have all called for modest increases in taxes that will be progressive and fair.  Particularly relevant to the legal community, there is a new effort, Lawyers Invest in DC.  The following is a letter from prominent D.C. lawyers urging a more balanced approach:

Dear Fellow Lawyers:

As you know so well from reading local news and more personally from your pro bono work, your service on legal assistance organization boards and your philanthropy, these are especially challenging times for low- and no-income residents of the District of Columbia.  The tumultuous economy has forced more community members into poverty and homelessness than ever before. 

Early in April, Mayor Fenty released his budget proposal for FY 2011 against the backdrop of a forecasted half-billion dollar budget deficit.  This gap can not be closed through program cuts alone without causing great pain and hardship for those who can least afford it.  There are a number of ways to generate revenue that would allow vital programs such as the access to justice initiative, interim assistance to persons with disabilities and child abuse prevention programs to be protected.  The Invest in DC campaign, which includes several local legal service organizations, has recommended the following:

1. Increase the income tax for DC  households with incomes above $200,000 (by less than $9 per $1,000 of income)
2. End DC’s tax exemption for interest paid on out-of-state bonds
3. Update the sales tax to include more services
4. Increase the minimum tax on businesses to $250
5. Bring parity to the alcohol tax by taxing alcohol bought at a store at the same rate as alcohol at a restaurant 
6. Tap into the DC’s “Rainy Day Fund”

As a legal community, we are well positioned to say that justice demands a balanced approach to addressing this budget crisis.  Many in the legal community are high-income earners and would be impacted by a bump up in the highest income tax bracket (Did you know that a legal aid lawyer earning $40,000 in DC is taxed at the same rate as a top partner in a large DC firm?).  Who better than those of us who would pay this modest amount to say "A tax increase is okay; it will cause no material change in my life, but could in fact save the life of a vulnerable District resident."  

It may not come naturally to say "tax me more," but to all of us who are part of this privileged profession of the law, it should come naturally to say "I am committed to justice in my community."  We urge you to join us in signing on to the Invest in DC campaign and calling on our elected officials to do right and do justice.  You can endorse this effort by following this link to the Lawyers Invest In DC page on the campaign's website.

Thanks so very much for your consideration.

              Jonathan Abram, Hogan & Hartson*

              Laurie Davis

              Lisa Dewey, DLA Piper*

              Peter Edelman, Georgetown Law Center*

              Robert Fleishman, Steptoe & Johnson*

              Tony Herman, Covington & Burling*

              Chris Herrling, WilmerHale*

              Jamie Hoag, DLA Piper*

              Barbara Kagan, Steptoe & Johnson*

              Bill Kelly, Stewards of Affordable Housing for the Future*

              Deanne M. Ottaviano, Arent Fox*

              Roberta Ritvo, DLA Piper*

              Dave Roll – Lex Mundi Pro Bono Foundation*

              George Ruttinger, Crowell & Moring*

              Don Salzman, Skadden*

              *firms listed for identification purposes only

Below is a list of the locations, times, and dates for the scheduled budget briefings (some have already been sent to the FBC listserve by the event sponsors). Please note that some briefings ask for an RSVP and questions to be submitted in advance. That doesn’t mean you can’t ask questions at the briefing, but it helps give agency directors an idea of the types of questions people are interested in.

Department of Mental Health

April 8th, 3-5pm

64 New York Avenue, N.E., 4th Floor Conference Room

• Submit questions to Shannon Hall at shall@dcbha.org by April 7th

Department of Human Services

April 13th, 10am-12pm

True Reformer Building, 1200 U St. NW

• RSVP to Katie Kerstetter at kerstetter@dcfpi.org by April 11th

Department of Disability Services

April 13th, 4-6pm

True Reformer Building, 1200 U St. NW

• Submit questions to advocacy@arcdc.net by April 12th

Child and Family Services Agency

April 14th, 4-6pm

DC Primary Care Association 441 4th Street, NW, Room 1114, Washington, DC 20001

• Submit questions to Yolanda McPhail-McKinley at yolanda.mckinley@dc.gov by COB Friday, April 9th

Department of Housing and Community Development and DC Housing Authority

April 15th, 12-2pm

Coalition for Nonprofit Housing and Economic Development, 1432 U St. NW

• RSVP to http://cnhed.wufoo.com/forms/please-rsvp-to-cnheds-budget-briefing/

Department of Health Care Finance

April 15th, 10-11:30

DC Primary Care Association, 1411 K St. NW

• RSVP to Anastacia Arons at Aarons@dcpca.org by April 12th

• Send questions to Jenny Reed at reed@dcfpi.org by April 12th