For the first time, the District of Columbia could move forward with a budget that is not tied to the federal appropriations process, thanks to a court decision issued Wednesday.
“I have to confer with our general counsel, but I expect that we’re going to have to follow the law, which is budget autonomy. Which means we’ll be voting twice and sending the budget to the Congress as we do with any other law,” D.C. Council Chairman Phil Mendelson said in a phone interview. On Wednesday, a federal appeals court dismissed a case surrounding the local Budget Autonomy Act, prompting D.C. officials and activists to argue it could now take effect. Mendelson indicated he believed the act could take effect, but he stopped short of definitively saying he would move forward with the new budget process under the act. He expects to "get clarity" about the ruling and come to a final decision about the next step over the next two weeks.
If it takes effect, the Budget Autonomy Act would alter the District's budget process. Currently, the District submits its budget request to the president and to Congress, and the funds are appropriated through the appropriations process, which takes several months. The act would decouple the D.C. budget from the federal funding process, though Congress would still have the power to review the budget.
As with any D.C. law, the budget would be sent to Congress for a 30-day review period, during which time Congress could move to block the budget. Although Congress would still be able to review the budget, the fact that the review period would be shorter and separate from the federal spending process is preferable to D.C. officials.
"If in fact we have autonomy, this will be the first time in 20 years that our budget will actually be approved before the start of the fiscal year,” Mendelson said, noting the District's fiscal year begins in October, like the federal fiscal year, but appropriators often do not approve a final spending plan until months later. "Because we're tied to the congressional process, things are delayed or vulnerable to shutdowns," he said. Many municipalities begin their fiscal years in July.
The court's ruling to dismiss the case was lauded by D.C. officials Wednesday, including Mayor Muriel Bowser and Del. Eleanor Holmes Norton, D.C. But Norton pointed out that the Budget Autonomy Act could still face opposition in Congress.
“I will continue my efforts to prevent any efforts by Congress to block or overturn the budget autonomy referendum, including during the upcoming appropriations process,” Norton said in a statement.
The Budget Autonomy Act already survived its congressional review period after it passed the D.C. Council and was overwhelmingly approved by D.C. voters in 2013. However, the Government Accountability Office issued an opinion following that period that the act was invalid. Rep. Ander Crenshaw, R-Fla, who chairs the appropriations subcommittee with jurisdiction over D.C., requested the GAO review.
Mendelson said the court's ruling Wednesday to dismiss the case and send it back to the local court was a promising sign that there might no longer be a federal question surrounding the act.
“From the viewpoint of Congress, there are some who argue that the local government does not have the authority to infringe on Congress’ role," Mendelson said. "But by essentially remanding the case to Superior Court, the federal court of appeals is saying there's no federal question.”
Although it appears Mendelson is poised to move forward with the act, the process faces a potential roadblock because District Chief Financial Officer Jeffrey S. DeWitt and D.C. Attorney General Karl A. Racine believe the "the legality of the act remains in doubt," according to a statement the two released Wednesday.
They added that they "are exploring expedited legal options to obtain judicial clarity on this issue, as proceeding with the budget process without such clarity would endanger the District’s finances and cause unnecessary uncertainty as to the manner in which the District manages its financial affairs.”
Brian Netter of Mayer Brown, who represented the council along with Boies, Schiller & Flexner’s Karen L. Dunn, explained Wednesday that D.C. Superior Court will have to decide whether to take up the case again. It is possible the court might not take up the case until the CFO has to actually start spending the money in the budget, which would not be until the fiscal year begins in October.
“If there's still a controversy, I would like it resolved as quickly as possible,” Mendelson said, when asked about the dispute within the D.C. government.
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