1. What’s In the Proposed FY 2012 Budget? CNHED/DCFPI FY 2012 Budget Briefing April 21, 2011 DC Fiscal Policy Institute (www.dcfpi.org)www.dcfpi.org

2. DC Tax Collections Are Still Well Below 2008 Levels

3. Most Areas of DC’S Budget Have Declined Significantly Since 2008

4. Mayor Gray’s FY 2012 Proposed Local Budget Total local budget: $6.34 billion Gross budget (including federal funds): $9.6 billion Increase of $105 million, or 2%, over the approved FY 2011 budget, after adjusting for inflation. However, funding for most services in FY 2012 budget is less than the amount available in FY 2011 for several reasons: Expiring Recovery Act $ Capital budget shifts Rising enrollment in public schools and Medicaid.

5. Steps taken to close the FY 2012 Budget Gap Revenue Increases: – The FY 2012 budget includes $158 million in new revenues, just under half would come from increase in taxes and fees and the remaining half from policy changes. Cuts to programs and services: – The FY 2012 budget makes $195 million in cuts: two out of every three dollars comes from human services and other low-income programs. DC Government Staff Reductions: – The FY 2012 budget would generate savings from eliminating 170 government full time equivalent positions

6. Revenue Increases in the FY 2012 Budget Taxes and Fees: $77.2 million Income tax rate increase & itemized deduction limit – New bracket of 8.9% at $200,000 Increase minimum franchise tax Combined reporting Parking tax Non-tax increases: $77 million Increased income tax withholding – Increased by $160 a year Extend hours for alcohol sales Payment from Washington Convention and Sports Authority

7. 2012 Budget Cuts Fall Most Heavily On Human Services *Other low-income programs include the following agencies removed from Economic Development: Employment Services, Housing and Community Development, Housing Authority and Housing Production Trust Fund

9. Local Funding for Affordable Housing Remains Well Below Pre-Recession Levels

10. ALL OF THE INCREASE IN FUNDS FOR THE HOUSING PRODUCTION TRUST FUND WILL BE TAKEN IN FY 2012 FOR OTHER PROGRAMS

11. THE HOUSING PRODUCTION TRUST FUND’S CAPACITY WILL BE SIGNIFICANTLY REDUCED OVER THE NEXT FOUR YEARS* FY 2012FY 2013FY 2014FY 2015 New Resources from dedicated taxes 39.040.341.542.7 Less: Debt Service on Revenue Bonds (6.7)(9.7)(12.7)(14.5) Total Subsidy 32.330.728.928.1 Less: Transfer of Funds to DCHA (18.0) Net for HPTF Activities 14.312.610.910.2 Less: Administrative Costs (5.4) Available for core HPTF purposes $8.9$7.3$5.5$4.8 * Dollars in millions. Source: All figures except debt service on revenue bonds are from the FY 2012 Budget and Financial Plan. Administrative costs are estimated based on available FY 2012 figures. The source of the figures for the debt service on revenue bonds are estimates from the Office of the Chief Financial Officer’s Office of Budget and Planning.

12. Significant Changes to Affordable Housing Programs in the FY 2012 Budget Housing Production Trust Fund: $18 million cut in FY 2012, and in future years Local Rent Supplement Program: phasing out the tenant-side Permanent Supportive Housing Program: shifting PSH clients into federal vouchers and LRSP units—reduces the overall capacity of affordable housing