DCFPI testified today before the DC Council in support of the nomination of Dr. Natwar Gandhi for a third 5-year term as the District’s Chief Financial Officer. We used the opportunity to highlight Dr. Gandhi’s policy accomplishments — and to point out some things we hope will be accomplished by the CFO in the next five years.
Under Dr. Gandhi, the District has developed a sophisticated and financial management system, with a team of highly competent fiscal stewards who show a great devotion to the future of the District of Columbia and have accomplished a lot:
- Long-term cost projections for proposed legislation: The CFO’s Office of Revenue Analysis produces fiscal impact statements that extend beyond DC’s four-year financial plan window, giving policy makers and residents the full long-term picture of the costs of proposed legislation. This is important because our four-year scoring window creates a natural incentive for policymakers to design bills to push costs beyond four years.
- Access to Better Budget Information: The Office of Budget and Planning has developed a new online tool, CFO Info, to help the public access budget information quickly and serves as a platform for providing more detailed budget information than was previously available.
- A Firm Cap on Debt: Dr. Gandhi encouraged the DC Council to adopt a 12 percent cap on the portion of the city’s budget that can be used for debt service. Before then, policymakers faced very little constraints when approving debt-financed projects, especially economic development projects. Now, policymakers must make choices and set priorities over the use of economic development resources.
DCFPI also laid out what we consider priorities for the District’s financial management over the next five years.
- Enhanced Budget Transparency: DC’s online budget tool should be modified to be easier to navigate and to include more detailed information, such as breakdowns of the use of federal and local funds for all line items. The CFO also should work with community stakeholders and DC government agencies to restructure agency budgets to better align budget line items with actual programs and services. It took many years just to get a separate budget line item for the Summer Youth Employment Program, and many other programs remain hidden in obscurely named budget line items like “program performance monitoring.”
- Addressing Federal Restrictions on Use of DC Resources: Dr. Gandhi should work closely with the Mayor and DC Council leadership to promote greater budget autonomy, starting with the overly restrictive federal rules governing DC’s local rainy day reserves. Now is a good time to promote better flexibility over the reserves, since there are no plans to use them, which means DC leaders could not be accused of changing rainy day funds to raid them.
- Focus on improving the working relationships of Agency Directors and Agency Fiscal Officers: The independent CFO structure in DC is fairly unique and resulted in a situation where agency directors generally report to the Mayor and agency fiscal staff generally report to the CFO. While this does not preclude a good working relationship between the agency director and financial staff, it has at times led to confusion and inefficiency. Dr. Gandhi could explore ways to give agency fiscal staff more encouragement and flexibility to work cooperatively with agency directors.
DCFPI’s testimony can be found here.
