VINCENT GRAY MAYOR

C.

BY HAND

The Honorable Kwame R. Brown Chairman Council of the District of Columbia John A. Wilson Building 1350 Pennsylvania Avenue, NW Suite 504 Washington, DC 20004 Dear Chairman Brown: I write to communicate the Administration's position on legislation that will be before the Council for vote at the April 17, 2012 Additional Legislative Meeting. Bill 19-654, the "Fiscal Year 2012 Revised Budget Request Emergency Adjustment Act of 2012" Thank you for your commitment to place before the Council for consideration Bill 19-654, the Fiscal Year 2012 Revised Budget Request Emergency Adjustment Act of 2012 and its accompanying temporary bill. This bill was introduced on January 13, 2012 and, since its introduction, the District's need to address these spending pressures has grown increasingly urgent. I am asking the Council to act expeditiously on this measure. As you are aware, on February 29, 2012, we received a revised revenue estimate from the Office of the Chief Financial Officer showing an increase of $34.8 million in fiscal year 2012. With this additional revenue now certified, I am proposing that the Council add it to the pending FY 2012 Supplemental Budget and utilize it to address one revenue item and three additional OCFO-certified spending pressures as well as two new spending initiatives which I believe are prudent and necessary. In addition, two previously included spending pressures can now be reduced or eliminated. I urge the Council to leave the remainder of the funds ($3.1 million) unspent. Specifically, I am requesting that the Council allocate $1.1 million of revenue to delay the tax on out of state bonds for one year, and to direct $15.4 million of funding to address new spending pressures related to Unemployment Compensation, D.C. Public Libraries, and the D.C. Public Charter Schools.
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Additional funding for Unemployment Compensation is increasingly urgent. Without it the District will be forced either to dip into the Contingency Cash Fund or cut off unemployment benefits to those in need. The gravity of the spending pressure means that the District of Columbia runs the risk of being anti -deficient. In addition to addressing the aforementioned spending pressures, I am proposing to reduce the previously submitted spending pressure for the Department of General Services to $4.0 million and to remove the $0.3 million of funding for the Ward 5 special election as, due to time constraints, this has been handled via a reprogramming. I am also recommending that we use a portion of the remaining balance of $20.4 million to fund adult workforce training in the Office of the State Superintendent of Education and to restore funds to District government employees who were furloughed for four days in 2011 to address what was then projected to be a significant funding gap. With the financial information we had at the time, last year's decision to furlough employees appeared to be necessary especially to avert the loss of jobs through a Reduction in Force. The recent finding that the District ended fiscal year 2011 with a considerable budget surplus compels me to believe that restoring the pay for those furlough days is the right thing to do for our District government employees. Finally, I am proposing to add budget authority to four agencies so that they can access already existing funds for which there is no spending authority. Specifically, $0.4 million of authority will be added to the Council of the District of Columbia, $1.5 million will be authorized for the Department of Employment Services, $2.5 million will be authorized for the Deputy Mayor for Planning and Economic Development, and $1.5 million will be authorized for the Office of the State Superintendent of Education. All of these additional requests are incorporated in a drafted amendment-in-the-nature of a substitute that was transmitted to the Council on Thursday, March 29th. As noted, approval of this measure, as drafted in the amendment in-the-nature of a substitute is absolutely imperative. I urge you and the Council to take prompt and favorable action on the proposed emergency and temporary legislation at today's meeting.

Bill 19-691, the "Foster Youth Employment Amendment Act of 2012" The Foster Youth Employment Amendment Act of 2012 presents an important policy goal for our city. The objective of the bill is to ensure that our foster youth are given every opportunity to engage in public service employment with our city, and that more mechanisms are in place to offer proper guidance as they age-out of foster care. The young adults that are in the foster care system have a unique relationship with the city due to the in loco parentis status the District accepts in their care. Therefore, this policy to increase our role in assisting with employment opportunities is both appropriate and needed. It is important to ensure that in accepting this new responsibility, we take a measured and prudent approach to the implementation of new preference points. Currently, other than District residents, only our veterans receive a preference for Career Service positions. They receive 5-points, unless they were disabled in the course of duty, in which case they receive a 10-point preference. A 5point preference for foster youth is both adequate and preferred for the following reasons. Being a
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District resident and a foster youth will guarantee them 15 total preference points, which will be sufficient to push foster youth ahead of any other applicant. Twenty points, as currently presented, will likely provide no further advantage. The population of District residents, that are veterans disabled in the line of duty, who would be competing against aged-out foster youth for entry-level career service positions is likely miniscule. Thus, there would not be a population that could match the foster youth preference points under my proposal. The city should be extremely judicious about how preference points are given. We may be poised on a slippery slope when other groups compare themselves with foster youth and challenge the distinction we make in this act (e.g., TANF recipients), As a policy, we should maintain that veterans disabled in the service to our country are the sole recipients of a 10-point preference. However, under my proposal, they would still be unlikely to compete with our foster youth in total preference points.

Bill 19-614 "Firearms Amendment Act of 2012" I continue to urge support for the Firearms Amendment Act of 2012, which is the product of hours of work between Councilmember Phil Mendelson and my administration. The bill is carefully crafted to provide common sense reforms to the District's gun registration law while ensuring the continued safeguards to protect District residents. I am pleased to support this bill and urge the Council to adopt the measure at final reading.

Bill 19-189 "People First Respectful Language Modernization Amendment Act of 2012" The offensive and outdated language contained within the District Code must be removed. The People First Respectful Language Modernization Amendment Act of 2012 would continue our movement towards a more inclusive and productive approach to working with people who are developmentally disabled. My career began by working with the individuals affected by developmental disabilities and that foundation has given me great respect for them. I urge the Council to correct the District Code by approving this bill at final reading.

Bill 19-163, "Vendor Sales Tax Collection and Remittance Act of 2012" I urge the Council to approve the "Vendor Sales Tax Collection and Remittance Act of 2012." The proposed legislation, introduced by Council members Evans and Michael Brown, would require licensed street or mobile vendors (including food trucks, sidewalk food carts, and merchandise vendors) to collect sales taxes, and each quarter, make a minimum sales tax payment of $375 to the Office of Tax and Revenue. Vendors that collect more than $375 per quarter in sales taxes would be required to remit the full amount collected. The bill would apply as of October 1, 2012. Current law requires all street vendors to make a payment of only $375 in lieu of collecting and remitting sales taxes. The OCFO estimates the fiscal impact of the bill to be positive, resulting in approximately $1.2 million in additional revenue annually, beginning in FY 2013. I strongly urge the Council to approve this measure.

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Bill 19-512, "Age-in-Place and Equitable Senior Citizen Real Property Act of 2012" I urge the Council to approve the "Age-in-Place and Equitable Senior Citizen Real Property Act of 2012." The proposed legislation, introduced by Council members Bowser, Evans, Mendelson and Michael Brown, would increase the adjusted gross income threshold for senior citizens claiming the longstanding (since 1986) 50% reduction in real property tax liability, from the current income level of $100,000 to $125,000. The CFO states that enactment of the bill would allow an additiona11,500 senior citizens to take advantage of the credit (beyond the approximately 20,000 currently claiming the credit), thereby reducing real property tax revenue by $1.23 million in FY 2013, and by $3.82 million between FY 2013 through FY 2015. The unfunded bill currently includes an applicability provision stating that it "shall apply upon the inclusion of its fiscal effect in an approved budget and financial plan."

Bill 19-271, "Real Property Tax Appeals Commission Establishment Act of 2012" The "Real Property Tax Appeals Commission Establishment Act of 2012," introduced by Counci1member Evans, is identical to emergency and temporary legislation already in effect which provides further clarification to the Real Property Tax Appeals Commission (RPT AC) established by legislation in Council Period 18. The RPTAC will replace the existing Board of Real Property Assessments and Appeals once the Mayor's pending nominations of the RPTAC chair and vice chair are confirmed and sworn in as members of the new body. Clarifications proposed in Bill 19-271 include: providing RPTAC with jurisdiction over timely appeals filed with BRP AA; increasing the number of part-time Commissioners from six to eight; authorizing training of existing commissioners as well as new commissioners; clarifying OTR's ability to disclose taxpayer information related to an appeal filed with RPTAC; increasing the number of days in which an owner may supplement an appeal from 10 to 20; clarifying that any appeals regarding the classification of real property as vacant or blighted should be filed with RPT AC; clarifying that filing an appeal with RPTAC is a pre-requisite to an owner filing an appeal with the DC Superior Court; and making other conforming amendments. I strongly urge the Council to approve this measure.

Bill 19-437, "Carver 2000 Low-Income

and Senior Housing Project Amendment Act of 2012"

The proposed unfunded legislation, introduced by Council members Alexander and Mendelson, is identical to emergency and temporary legislation previously signed and currently in effect subject to appropriations. The "Carver 2000 Low-Income and Senior Housing Project Amendment Act of 2012" would extend a tax exemption which had previously been in effect for eight years - from 2003 through 2010 -- for property known as the Carver Apartments at 47th and East Capitol Streets SE, in the Marshall Heights neighborhood of Ward 7. The bill would extend the exemption from 8 to 16 years, thereby

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continuing the exemption through 2018. Some of the property that is currently vacant will be redeveloped into 28 units of affordable housing when the project's financing is secured, for which construction is scheduled to begin in 2014 with completion two years later. The other property contains 104 units of affordable housing (94 at 60% AMI, 10 at 50% AMI) for senior citizens. The OCFO estimates that the proposed exemptions total an estimated $1.97 million over the 8-year period of the exemption, including $1.2 million in unfunded impact during the FY2013-FY2016 financial plan. I strongly urge the Council to approve this measure.

Bill 19-530, "King Towers Residential Housing Real Property Tax Exemption Clarification Act of 2012" The proposed unfunded legislation, introduced by Council member Evans, would authorize a one-time exemption from economic interest tax and real property tax assessed by OTR on property owned by King Towers LLC, located at 1220 12th Street N.W., which is a 129-unit apartment building serving low-income residents. The property was owned by a non-profit entity which was exempt from the taxes in question until August 2010, when the property was transferred to a for-profit entity in order to take advantage of federal Low-Income Housing Tax Credits. With this transfer, the property became subject to property and economic interest taxes. Although 2010 emergency and subsequent permanent legislation provided a real property tax exemption to King Towers LLC, the legislation did not authorize an exemption from the economic interest tax. Additionally, due to a 19-day gap between the expiration of the emergency legislation and the effective date of permanent legislation, the property was subject to real property taxes. The CFO estimates the one-time cost of the bill is $648,511 in FY 2012. I support the Council's approval of this measure and urge the Council to consider adding this expenditure to B 19654, Fiscal Year 2012 Revised Budget Request Emergency Adjustment Act of 2012.

Bill 19-538, "Jubilee Housing Residential Project Real Property Tax Exemption Clarification Act of 2012" The proposed legislation, introduced by Council member Graham, is identical to emergency and temporary previously signed legislation that is currently in effect. The measure would clarify the lot numbers of a previously enacted property tax exemption for two properties known as Sorrento and Euclid, located in the Adams Morgan neighborhood of Ward I. These properties comprise 70 units of extremely low-income housing, serving mostly those below 30% AMI. The CFO states that the clarification has no fiscal impact. I urge the Council to approve this measure.

Bill 19-601 "Adolf Cluss Court Alley Designation Act of 2012" This legislation, introduced by Council member Wells, designates an alley that runs between C and D Streets, S.E. , and parallel to 12th and 13th Streets, S.E., in Ward 6, as "Adolf Cluss Court." Adolf Cluss was a German-American architect who was a design innovator for many buildings throughout the District of Columbia. Mr. Cluss was responsible for designing The Calvary Baptist Church at 8th and H Streets, N.W., the Masonic Temple at 9th and F Streets, N.W., and the Franklin School at 13th and K

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Streets, N.W., as well as many other important buildings. "Adolf Cluss Court Alley Designation Act of 20 12. "

I support the Council approving Bill 19-601,

BiIl19-644 "Elizabeth P. Thomas Way Designation Act of 2012" This legislation, introduced by Council member Bowser originally as "Aunt Betty Way Designation Act," symbolically designates Quackenbos Street between 13th and 14th Streets N.W., in the Brightwood neighborhood of Ward 4, as "Elizabeth P. Thomas Way." Elizabeth P. Thomas, who was known as Aunt Betty, owned about 8 acres of land which were confiscated by Union troops in 1862 during the Civil War to fortify Fort Stevens. Although she continued to provide food and shelter to Union soldiers on adjacent land that she owned, and although President Lincoln personally promised financial compensation, Mrs. Thomas reportedly was never compensated for the loss of her original land and home, due to Lincoln's untimely death and the lack of action by Congress. I strongly support the Council approving Bill 19-644, "Elizabeth P. Thomas Way Designation Act of 2012. "

BiIl19-651, "Where Lincoln's Legacy Lives Designation Act of 2012" The proposed legislation, introduced by Council member Evans, would symbolically designate the 500 block of 10th Street N.W., in Ward 2, as "Where Lincoln's Legacy Lives." The designation of this block, where Ford's Theater - the site of Lincoln's assassination -- is housed, commemorates the 150th anniversary of Abraham Lincoln's presidency and the recent opening of the Ford's Theater Education and Leadership Center across the street. I support the Council approving Bill 19-651, ({ Where Lincoln's Legacy Lives Designation Act of 2012. "

BiIl19-695, "Hilda H.M. Mason Way Designation Act of 2012" The proposed legislation, introduced at my request, would symbolically designate the 1400 block of Roxanna Road N.W., in the Shepherd Park neighborhood of Ward 4, where Hilda and her husband Charlie Mason lived for many years, as "Hilda H.M Mason Way." Hilda Howland Minnis Mason contributed significantly to the District of Columbia as an educator, civil rights activist, school board member (1971-77), DC Councilmember (1977-1998), leader of the DC Statehood Party, and selfproclaimed "grandmother of the world." Hilda Mason was an exceptional woman who overcame the legacy of slavery and the Jim Crow-authorized oppression of African Americans to achieve political prominence for her significant contributions to the District of Columbia. I urge the Council to approve Bill 19-695, "HildaHM Mason WayDesignationActoj2012."

PR19-561 "Director of the Child and Family Services Agency Brenda Donald Confirmation Resolution of 2012 I urge the Council to support this resolution to name Ms. Brenda Donald as the Director of the Child and Family Services Agency. Prior to accepting her nomination for the position on January 3, 2012, Ms. Donald served as Vice President for the Center for Effective Family Services and Systems with the
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Annie E. Casey Foundation. The experience gained from her service with the Casey Foundation will be invaluable to the agency as it moves forward to achieve better service delivery for our residents. Ms. Donald's employment background demonstrates a deep commitment to the District, including previously serving in the capacity as the Director of the Child and Family Services Agency. This background has allowed Ms. Donald to make great strides towards continuing successful reforms as soon as she was appointed. I look forward to working with Director Donald to increase the positive outcomes of the agency.

PR19-595, the "Amendment Resolution of 2012

to Contract

No.

DCKT -2008-H-0133

Emergency

Approval

I urge the Council to approve PR19-595, the Amendment to Contract No. DCKT-2008-H-0133 Emergency Approval Resolution of 2012 with Fairfax County, Virginia. This contract would allow the District to continue disposing of waste in an efficient manner. The current agreement with Fairfax County has a ceiling on the volume of trash that the county will accept from the District annually. Due to increased waste disposal, the District expects to exceed previously agreed upon levels. Under the proposed modification Fairfax has agreed to accept an increased volume to accommodate the District's needs. Without the use of Fairfax as a disposal site, the trash would have to go to a landfill which is less environmentally friendly, or the District would have to refuse the additional waste and forgo the opportunity for additional revenue.

"Council Capital Reprogramming Policy Emergency Act of 2012" I am strongly opposed to the Council Capital Reprogramming Policy Emergency Act of 2012. This emergency bill would require the Executive to transmit to the Council all capital budget reprogramming requests of less than $500,000 during the Council's budget deliberations. Adoption of this measure by the Council could result in delayed capital improvements to projects possibly located in every ward of the District of Columbia. A key characteristic of my administration is the timely implementation of projects, some of which need relatively small amounts of additional budget to complete. To delay such an improvement will result in additional costs and uncertainties as contractors are told to stop work at the job site until funding of less than $500,000 is approved by the Council. Delays, caused by the unavailability of funds, inevitably will cause overall project costs to rise as contractors factor a greater degree of uncertainty into their bids. Both in the short term and the long term, this will have the effect of increasing capital costs and thus this legislation will have a negative fiscal impact. On other occasions, projects are completed with a small surplus, which I have directed be reprogrammed as quickly as possible to other high priority needs. The emergency bill would also require the Chief Financial Officer to inform the Council when the Executive places a hold on certain available capital budget allotments previously approved by the Council. Routinely, when staff identifies budgets available for reprogramming to complete a priority project, we instruct the CFO to prevent spending of those budgets while we conduct internal deliberations regarding whether to request a reprogramming. This emergency could potentially interfere with the Executive's ability to efficiently implement and complete capital projects.
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Also adopting this measure on an emergency basis, prevents the Executive from explaining its process for reprogramming capital budgets and answering any question a member of the Council may have because the change in policy is being enacted without the benefit of a public roundtable or hearing. I am committed to working with the Council on capital budget needs and, if there are previously approved capital budgets that the Council would like to consider using to fund other projects, I would like to hear its views and recommendations. I know of no instance in which we have refused to share information with the Council about capital projects and their costs-no matter how small. Thank you for the opportunity to express the Administration's legislation. views on these important pieces of

Vincent C. Gray Mayor cc: Members of the Council of the District of Columbia

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