Posts in category Government

Rob Pitingolo has done a lot of research on which places have more or fewer people with college degrees. DC has the fourth most college degrees per square mile of any city in the nation, but that doesn't apply everywhere in the region or everywhere in DC.

Rob created these maps that show the locations of people with and without college degrees aged 25 and over.

There seems to be a fair amount of mixing in Virginia, but in DC and Maryland, the divide is starker. East of the Anacostia, blue dots are very few; west of Rock Creek and in the central city, they overwhelm the pink dots.

A lot of news stories talk about the DC region in terms of the division between black and white. The city's history of racial segregation has left a legacy of educational and socioeconomic inequality. As a result, many commentators use race as a simplistic shorthand for conflicts that are really about college educated versus not, or wealthy versus poor, or young versus old.

Race is immutable, but other characteristics are not. If our divisions are really about black versus white, they're not going to change unless some people move out of the city, and that's not what we want to happen. But education levels can change, and it's good for everyone if we can help all people in our region access better education.

Members of Pro-DC don't need to agree with every element of the zoning update. I don't. But we also believe that DC will grow and change regardless of public policy, and that our zoning should shape that growth in a positive way that improves the quality of life, increases amenities, and strengthens affordability for all residents.

In coming months, there will be some major battles over the zoning update that cut to the heart of how people see DC's future. These positive changes won't become reality unless decision makers hear from residents who share the vision. I hope you will join the email list, and ask your friends to do the same.

The high tolls are a direct result of the state's failure to invest its own money in this critical transportation project, placing the burden fully and unfairly on northern Virginians. Instead of making the case to the Loudoun Board of Supervisors for the importance of moving forward, McDonnell's administration is making it easier for them to vote no, endangering the whole project.

The Governor just threatened again, via a budget amendment, to withhold the state's meager $150 million contribution to Phase 2 if his new appointees to MWAA were not seated immediately instead of on July 1st. Fortunately, the Virginia House of Delegates voted yesterday to kill the amendment, stopping this latest threat.

One of the main points of disagreement between the McDonnell administration and MWAA has been Project Labor Agreements (PLAs). These have been successful on the Woodrow Wilson Bridge and Dulles Rail Phase 1 projects.

PLAs are not just about regulating union labor and wage rates for workers. They also require unions to help secure an adequate supply of skilled trades for these massive projects, and to ensure effective coordination among the dozens of trades and subcontractors, both union and non-union, for smoothly functioning, safe, and timely construction. The preference for PLAs in the bidding process seems a reasonable solution. We should move forward with these provisions.

The governor says he is greatly concerned that Virginia doesn't have a majority of seats on the MWAA governing board, which controls Dulles and Reagan National Airports, as well as the Dulles Toll Road and the Silver Line project. But this regional agency has effectively served our region for a long time, completing major and complex expansions of both airports.

It is true, however, MWAA could be much more transparent and accountable, as the IG report notes. The Coalition for Smarter Growth was among the first to raise this issue in 2006 when the Kaine administration proposed handing control of the project over to MWAA. Pressure from the governor, our federal and state legislators, and local elected officials has resulted in key reforms at MWAA. These reforms should continue, but so should the Silver Line.

The attacks on MWAA may have more to do with securing state control of future toll road revenues, for use on road projects like the Northern Virginia Outer Beltway and other rural highways, than about fixing the governance of MWAA.

We can't know that for sure, but it's very plausible given the administration's power grab at the Virginia Port Authority. After reorganizing the port authority's board to ensure control from Richmond, the administration pressed new board members to approve diverting $250 million to Route 460, a rural highway between Hampton Roads and Petersburg that Hampton Roads leaders say is not their top priority. A similar effort by the governor to secure a controlling majority on MWAA in order to do the same thing would not work to the best long-term interests of Northern Virginians.

McDonnell says that he could not even contemplate funding another $300 million for Dulles rail without raiding other projects throughout the state. But is he setting the right priorities? What money might actually be available?

The governor is proposing to spend over $750 million on the Route 460 project. Another $244 million is being earmarked to the controversial Charlottesville western bypass, a road that appears to be ineffective and a waste of money. Millions are going to the Coalfields Expressway to support mountaintop removal in an area with little traffic.

Even accounting for these projects, there may be another $400 million available in the $1.5 billion Public-Private Transportation Act fund. Setting different priorities would free up hundreds of millions more.

It's hard to respond to the governor's argument that Northern Virginia is getting its fair share of the state's funding without seeing the full picture. A clearer accounting of complicated funding flows would be helpful for both the public and legislators. Certainly, making significant investments in addressing the transportation needs of Northern Virginia should be a priority given the importance of the region to the state's economy.

Perhaps symbolic of the administration's priorities, Virginia Deputy Secretary of Transportation David Tyerar made two recent trips from Richmond to Leesburg to appear before the Loudoun Board of Supervisors. He didn't go to make the case for Dulles Rail. Rather, he spoke to promote the Outer Beltway.

The governor and secretary revived planning for the Outer Beltway, added it as a new Corridor of Statewide Significance, and are exploring the route for yet another public-private partnership. Yet this highway would do little to help massively congested corridors like I-66, Route 50, and Route 7. The contrast between the obstacles put before Dulles Rail by the McDonnell administration and their full-court press for the Outer Beltway couldn't be starker.

If the Silver Line's phase 2 fails, it will be on Governor McDonnell's watch. He should lead the way to compromises that will allow the project to move forward, and focus more of the state's transportation resources on this economically critical project.

To: Members of the Council of the District of Columbia
From: Councilmember Mary M. Cheh
Date: May 14, 2012
Subject: The District's Fiscal Year 2013 Budget

Tomorrow, we will take our first vote on the Fiscal Year 2013 budget. To encourage transparency and open debate, this memorandum provides a summary of all budget recommendations from my office. The recommendations are divided into Committee and Non-Committee proposals.

Committee Recommendations

1. Prohibit the sale of gasoline in the District beginning January 1, 2014. In the interim, the District shall raise its excise tax on gasoline from $0.235 to $8.75, which we are told represents roughly 50% of the jobbers' current markup on motor fuel in the District. Revenues from the tax shall be converted into capital dollars for the construction of a hydrogen automobile factory. Beginning January 1, 2014, hydrogen may only be purchased from stations operated by small and disadvantaged businesses grossing less than $777.9 million annually (or whatever Capitol Petroleum's gross revenue may be at that time).

2. Convert $12,000,000 from the District Department of the Environment's operating budget into capital dollars to fund the construction of a new shelter. The new shelter, known as the "Cheh Rat Sanctuary," will be open to families of rodents who have been forcibly relocated. At the shelter, they will be able to live together in peace and without fear of being exterminated. Based upon discussions at the "Rat Summit of 2012," the Virginia Attorney General offered to house the sanctuary on his Fairfax estate. We are awaiting further communications with the Virginia Attorney General's office and are preparing an MOU to facilitate the interstate transfer of funds.

3. Related to number 2 above, create a special purpose fund for fees collected as part of a new written examination to be administered to states' Attorneys General of other jurisdictions. The examination will measure knowledge of constitutional law and basic reading skills, and a passing score will be required for each Attorney General who wishes to opine on District matters. Sample questions may include: "Which of the following sentences does not include the word 'rat'?" Proceeds from the fund shall be used to establish public grief counseling units for rats and other commensal rodents who have lost family through pest control. The fund shall be managed by the District Department of the Environment.

4. Transfer $250,000 from the Department of Motor Vehicles' Adjudication Services to a newly created Global Positioning System (GPS) person-tracking program. Through the program, select individuals will be asked to wear GPS-powered, "District-loyalty" ankle bracelets used to implement the following requirements:

Council Members shall be barred from outside vacationing. Elected officials—particularly those with second jobs—should not waste valuable time and potential tax dollars vacationing in other jurisdictions. Moreover, a member may become beholden to a Hampton Inn in Maryland, whose free breakfast policy creates an obvious conflict of interest and may run afoul of the new ethics rules if the member chooses to have a second free waffle. The change should also boost tourism as vacationing members can highlight many of the District's top destinations and activities. Sample activities include touring archeological sites in Spring Valley, taking advantage of natural exfoliation in the Anacostia River, enjoying a mud bath at Blue Plains, or watching a filibuster in the U.S. Senate or at an ANC meeting.

Establish a residency requirement for the Washington Post's editorial board. This requirement is expected to generate tax revenues from new residents and additional tax revenues from whichever entity is now hired to perform public relations for former Mayor Adrian Fenty.

5. Transfer $25,000 in capital dollars to the District Department of Motor Vehicles. The funds will be used to establish a new, state-of-the-art, customer queue management system. All residents seeking DMV services will participate in mandatory BINGO games. When a patron achieves BINGO, s/he will become next in line for DMV services. The measure is expected to improve customer enjoyment at DMV and to decrease the average wait time by three hours and seventeen minutes.

Non-Committee Recommendations

1. Transfer 95% of all Council Committee budgets and FTEs to the Committee of the Whole. To maximize efficiencies and streamline the government, the following additional functions will now fall under the Committee of the Whole: Public Services, Consumer Affairs, Government Operations, the Environment, Public Works, Transportation, Planning, Economic Development, Housing, Workforce Development, Tax and Revenue, Health, Human Services, the Judiciary, Small Business, and Aging. The following areas shall be divided up among the other Council Committees at future date to be determined: the Office of Cable Television, the Office of Risk Management, the Boxing Commission, the Bicycle Advisory Council, and the Department of Parks and Recreation. In order to allow members to spend more time focusing on their revised committee responsibilities, the Committee of the Whole will now include only the following members: the Council Chairman.

3. Add a new requirement for the Council as part of the Budget Support Act. Recently, the Council passed legislation requiring all students to apply to at least one college in order "to raise expectations for students, and create a culture of academic excellence and success in District schools." Add a new BSA provision requiring all Council Members to apply to at least one job in order to raise expectations for members, and create a culture of professional excellence and success in District government. The measure is expected to be budget neutral.

4. Beginning October 1, 2012, Council Members who use profane language shall be required to deposit five cents into a special purpose non-lapsing fund, designated as the Saying Words Egregious to Aural Recipients by Juvenile Actors Reacting, or SWEAR JAR. Funds shall be distributed to DCPS schools to offset the $17 million shortfall for the IMPACT teacher evaluation system caused by the loss of private grant funds. After the first $17 million is provided to DCPS schools, remaining funds shall used to purchase ear muffs for use at Council breakfasts.

5. Transfer $3,000 from the Department of General Services maintenance fund to be used for marketing. As the District government continues to "right size," vacant District-owned property represents untapped income. Therefore, I am recommend allocating $3,000 to advertise available office space in the Wilson Building. With minimal outreach, we have already successfully leased a vacant suite of offices on the first floor of the building to the Federal Bureau of Investigation's Washington Field Office. With just a bit more outreach, I believe we could easily fill other vacant spaces as well. For example, I understand that the Federal Bureau of Prisons is exploring some additional space in the basement and expects to conclude negotiations soon.

6. Establish the Resident Relocation Fund, a new special purpose fund. Some residents simply are not well suited to live in a major city. They fear sidewalks, bicycles, traffic, noise, parking, and university dormitories. To address their growing list of concerns, we shall establish the Resident Relocation Fund, which will subsidize the costs of these folks moving outside of the District and include a complimentary municipal bond, untaxed, from the jurisdiction of the ex-resident's choice.

7. Add a further amendment to the BSA. With the passage of B19-0474, the Lottery Amendment Repeal Amendment Act of 2012, the District gave up millions of dollars in potential revenue. Much of our concern related to the iGaming contract stemmed from the lack of transparency in the bidding process. To remedy that problem, add a BSA provision that would once again put an internet-based gaming system out for contract, but with the added mandate that the payment for that contract be made only with money orders. In doing so, the District will enhance its revenue stream while ensuring a clear and easily traceable contract process.

Should you have any questions about the below measures, please take a hard look in the mirror. The ideas here are brilliant and need no further explication. Please do not contact my staff or me with your questions or concerns.

First wave of subsidies reap healthy return

Most pre-recession subsidies were made through tax increment financing (TIFs), in which future gains in sales and/or property taxes from a development are used to repay bonds that finance a developer subsidy.

Each of these TIFs are repaying to the city well ahead of schedule, providing needed funds for schools, social services and other cash-strapped priorities in DC.

Many of these projects were harshly criticized at the time as corporate giveaways. So the speedy repayment of these subsidies lends credibility to the arguments of their proponents, such as Councilmember Jack Evans and former Mayor Williams, and to TIFs in general.

These TIFs were successful because they were designed in accordance with two principles of effective corporate subsidies. As will be seen below, present-day corporate subsidies haven't always followed one or the other of these two principles.

1) Focus on knock-on benefits: Advocates for corporate subsidies often appeal to the tax revenue that would be lost if a developer doesn't build a building or a company chooses not to locate in one's city. Successful subsidies, however, are more focused on knock-on benefits that are strategically important to a city's finances.

Granting subsidies so that a company's activities—developing a property, locating in one's city—will yield tax revenue only encourages rent seeking by all companies who develop a property or choose to locate in the city.

When the desired activity is to locate in one's city, a "race to the bottom" ensues between states which only hurts their collective ability to pay for education and social services.

That's why effective subsidies are designed to yield knock-on benefits that support a city's strategic goals, like developing a particular sector or a particular part of the city.

The first wave of TIFs were intended to steer the development of downtown away from office buildings and towards multi-use. As Councilmember Evans explained it, "The highest [revenue] use is an office building but then you end up with a Crystal City complex which I can't stand."

The knock-on activities—more downtown residents and more downtown shoppers—the downtown TIFs triggered are not only strengthening those investments, but also producing tax revenue from downtown in many other forms. That's what happens when knock-on benefits are the goal, not the direct tax revenues of an investment.

2) Narrowly target subsidy to yield knock-on benefits: There are always risks with corporate subsidies. The company could pick up and leave without it, or maybe they would have completed the project even without the subsidy.

That's why it's critical to limit a city's exposure. Subsidies are investments, and investments have risks. The DC CFO narrowly targeted the first wave of TIFs to be only as much as is needed to stimulate the intended knock-on benefits for the city.

For each TIF application, the CFO conducted a gap analysis. This analysis compares the amount of private financing that should be available for a development to the costs of the project. The CFO would only certify TIFs at that subsidy amount. The head of economic development finance for the DC CFO, John Ross, explained the process this way:

CFO had to do a certification, and that certification had to include a list of issues. One of them was whether the TIF would cover the debt service payments. One was whether the project would move forward without government support. One was the level of benefits of the TIF that would go to the community. Without that, the TIF could not even go to the Council.

Present-day subsidies often veer from principles of early TIFs

If the District's first corporate subsidies have reaped such healthy returns, several present-day subsidies veer from the principles behind the successful subsidies.

Some recent large TIFs, like Southwest Waterfront and O Street Market, as well as the proposed LivingSocial tax break, don't follow these principles.

There has been no financial gap analysis for more recent TIFs. Without ensuring that any financing gap actually exists, DC doesn't know if development projects would have happened anyway and it risks overpaying.

The first wave of TIFs were granted under the TIF Authorization Act of 1998 which required a thorough financial analysis and certification by the CFO.

Though no longer empowered to certify TIFs, the CFO still provides financial assessments of TIF applications to the Council and Mayor. These assessments raised particular concerns about 2 TIFs: City Market at O Street and the Southwest Waterfront.

The CFO, in his assessment, complained that both the O Street and Southwest Waterfront TIFs were being granted with less information about the project than would be required to issue a complete financial evaluation. There were no final plans or cost estimates for either project.

In fact, neither application included a specific financial commitment from the private developer, making impossible any analysis of the necessary size of the subsidy. The O Street application said that the developer for the hotel hadn't even been identified yet, even though the hotel was supposed to provide 44% of the incremental tax revenues to repay the bond.

While the CFO's office was included in negotiations with the developers after raising concerns in their analyses, the process for granting these TIFs was clearly intended to increase speed at the expense of financial scrutiny.

More recently, the proposed LivingSocial subsidy of up to $32 million to remain and consolidate their operations in the District also veers from proven principles of corporate subsidies.

Proponents of this subsidy often appeal to the tax revenues from LivingSocial that will far exceed this subsidy. Paying for tax revenue, however, only rewards companies who threaten to leave while encouraging a race to the bottom between states competing for companies.

The LivingSocial proposed subsidy is intended to be targeted. The subsidy doesn't begin until 2015 and scales based on the number of DC residents employed, which must be at least half of LivingSocial employees.

But are these jobs that we should be paying for? They aren't strategically aligned with the needs of the city's unemployed, and most of the jobs won't contribute to building a tech sector.

According to a source, only 15% of LivingSocial jobs are in technology, IT, and product development. A subsidy that was targeted to generate knock-on benefits that are strategically important would thus focus on retaining that 15% of LivingSocial positions.

The debate around corporate subsidies is too often dominated by loud voices at the extremes. But experience shows that corporate subsidies can work, and they can also be a waste of precious dollars.

The next time you read of a proposed corporate subsidy, avoid these hyperbolic extremes and ask if the subsidy adheres to these two proven lessons for effective subsidies. If it does, defend the administration that proposes the subsidy, If it doesn't, as recent subsidies have not, then ask questions.

As Michael explained 3 years ago, WMATA is basing this decision on a 2 DC district court cases, Judicial Watch, Inc. v. United States Department of Justice and Electronic Privacy Information Center v. Department of Defense, where courts denied "news media" status to these organizations in 2000, 2002 and 2003.

WMATA's Public Access to Records Policy (PARP) says that it follows the federal FOIA, meaning that this law clarifying FOIA also applies to WMATA's PARP.

The WMATA denial, which just copies the previous one from 2009, claims that, "A representative of the news media must itself disseminate the information not merely make it available."

But, as Michael Perkins notes, the Open Government Act of 2007 clarified a broader interpretation of "news media" as:

any person or entity that gathers information of potential interest to a segment of the public, uses its editorial skills to turn the raw materials into a distinct work, and distributes that work to an audience.

These examples [newspapers and broadcast radio or television] are not all-inclusive. Moreover, as methods of news delivery evolve (for example, the adoption of the electronic dissemination of newspapers through telecommunications services), such alternative media shall be considered to be news-media entities.

Back in 2009, the media relations team wasn't sure they should talk to blogs such as Greater Greater Washington, but since then, that group has started to treat us as "news media" and help answer questions that will go into articles. Perhaps they should speak with the legal department.

If you can help us formulate a more detailed legal argument to make to WMATA and, if they don't see the light, pursue the matter in the courts, please email info@ggwash.org.

Here is the full text of their email from Keysia Thom at WMATA:

Dear Mr. Perkins,

This acknowledges receipt of your request for a copy of the survey, results, and weights used by the JCC to determine the fare model for the Metrorail rider survey. This also responds to your request for a fee waiver and requires an advance payment by May 16, or your request file will be closed. Your request is being processed pursuant to the Public Access to Records Policy (PARP), which can be viewed on our website at http://www.wmata.com/about_metro/public_rr.cfm, under the section marked, "Legal Affairs." Generally, we aim to issue decisions on a request for records within 20 working days after the date of receipt of the request.

We note that you requested a fee waiver for search time because you are an author for Greater Greater Washington. Pursuant to federal regulations, a representative of the news media is any person actively gathering news for an entity that is organized and operated to publish or broadcast news to the public. 28 C.F.R. § 16.11 (b)(6) (2012). Examples include television and radio stations broadcasting to the general public, publishers of periodicals that disseminate news to the general public, and freelance journalists who can demonstrate a solid basis of publication through a news organization. Judicial Watch v. United States Dep't of Justice, No. 99-2315, 2000 U.S. Dist. LEXIS 19789 *9-12 (D.D.C. August 17, 2000). Your request consists of a conclusory statement that you are a member of the news media, but does not provide any details about your editorial skills and how you intend to distribute the records to the public at large. We have viewed Greater Greater Washington's website and it appears to be a blog. Judicial Watch, an organization that promotes transparency in government and operates a website that includes news on that topic and its activities (including those reported by the media), has been found not to qualify as a representative of the news media. Judicial Watch v. United States Dep't of Justice, No. 99-2315, 2000 U.S. Dist. LEXIS 19789 *9-12 (D.D.C. August 17, 2000). A representative of the news media must itself disseminate the information not merely make it available. Judicial Watch, Inc. v. United States Dept of Justice, 185 F.Supp. 2d 54, 59 (D.D.C. 2002). For these reasons we have denied your request for a fee waiver under the media category.

...

We estimate that it will cost $261.00 for 3.0 (5 hours of staff time - the first two hours of staff time, which are provided free of charge) to retrieve and review the records that are responsive to your request for exempt material. Please remit a check for the full amount made payable to the Washington Metropolitan Area Transit Authority to my attention by May 16, 2012. The records will be provided as soon as possible after receipt of payment, along with reimbursement of any excess payment or request for additional payment. If we do not receive the payment by May 16, we will close your request file.

How does HPAP work? HPAP is the District's homegrown downpayment assistance program which provides up to $44,000 for first-time, low- and moderate-income home buyers. HPAP acts as a second mortgage. Recipients begin paying their loan down starting in year five of owning their home and make monthly payments over a 40-year period instead of the traditional 30-year period, making the payments more affordable. As HPAP recipients repay their loans, the city recoups the cost, which currently generates $2 million in repayment every year.

Although beloved by politicians and residents alike, HPAP has dwindled since 2008. The program in FY13 is slated to be only a third of its size only five years ago. As a result, the number of people who can use the program has fallen. And this year, the decrease will impact about 100 families. According the DHCD, last year the program served 246 families, next year it will serve around 150.

The city has used federal funding to maintain the HPAP program, relying heavily in recent years on stimulus dollars, but this year, federal funds are not available to fill the gap. The federal Department of Housing and Urban Development's grant programs that have also funded HPAP also dwindled; its HOME program shrank 37% in 2012, and its Community Development Block Grants (CDBG) dwindled by 12%.

Also, the 2010 Census made DC is eligible for less CDBG funding, since the city has fewer high poverty areas than in previous years. All of these combined losses have left few funds available for housing programs like HPAP.

HPAP budgets have decreased substantially since FY 2008.

In April, more than a dozen HPAP recipients attended the DHCD budget oversight hearing to advocate for the program that has helped them become District homeowners. Attendees highlighted the diversity of residents impacted by the program.

Elizabeth Palmberg purchased her home with an HPAP loan, only to be diagnosed with lymphoma soon after. She has been able to afford her mortgage despite her health struggles; "the HPAP program helped me to be able to still buy my condo, and now every month as I write my mortgage check, I am grateful to be building equity which will give me stability against shocks that life might send my way in the future."

Bernice Joseph was able to purchase her home in Logan Circle in 2002 and has no plans of leaving the neighborhood. She loves the convenience, and believes that HPAP has had a huge impact on her family and her educational opportunities. "Without this program I do not know where I would be. But I do know I would not be in my neighborhood, the one that is so dear to my heart, the one where I have put down roots, and the one where I have lived for the past 21 years. I have raised all four of my kids in DC. Without the stable price of my mortgage, I would not be able to afford to go back to school. I definitely could not afford my classes if I had to pay market-rate rent."

The value of homeownership of course extends beyond the individual. Homeowners pay property tax back to the city and provide an anchor for communities. Homeownership is an indicator of success for families and kids across the country and one of the most important wealth-building tools in our country, especially in communities of color and low-income communities. A 2003 study found that housing wealth accounted for 77% of all low income household's wealth.

HPAP has supported District residents and communities by encouraging homeownership, neighborhood stability, and equity building. This year, the program will become even weaker after years of reductions. The DC government should encourage residents to become homeowners, to invest in their communities and themselves by supporting the HPAP program with local funds.

Sarah Scruggs contributed to this blogpost, which can also be found at www.housingforallblog.org.