Being outside a state has its advantages
Residents and officials in the District of Columbia often lay a number of the city's problems on the fact that DC is not a state nor located in one.
Many cities have large state governments that can help pick up the tab for various social welfare programs, education funding, and transportation costs, among other public expenses. The District, on the other hand, is left to fund all public services that a state would typically provide all while trying to squeeze as much revenue as possible from an already stressed tax base.
Further complicating the situation, the federal government does not provide the District a payment in lieu of taxes (PILOT) to help offset lost revenue on the 40% of DC's property that is tax exempt. Congress also prohibits the District from charging income taxes on the 500,000 non-residents who work in DC, a privilege regular states enjoy. This creates what DC Appleseed calls a "structural deficit."
While this does put the District at a disadvantage, it isn't totally up the creek when it comes to paying for certain state-level services. Even though Congress doesn't provide a direct PILOT to the DC government, the federal government does pay for the costs of the District's criminal justice and prison system, provides a larger share of Medicaid funding, and the District is eligible for federal grants that would typically only be available to states.
In addition, since the District collects all revenue from sales, income, and property taxes as well as municipal bonds, DC has far more flexibility in how to fund government projects and services than neighboring counties and cities. The lion's share of local revenue available to our neighboring jurisdictions is typically derived from property taxes. That constrains counties as they try to find ways to pay for teachers, police, and civil servants.
It's for these reasons that I always wonder if the District is better off than many other jurisdictions, even despite living under the shadow of Congress and despite the fiscal challenges. With the possible exception of Native American reservations, no other municipality in the country has near-total authority over all levels of local government.
Though Congress seems to enjoy interfering in purely local affairs, especially hot-button political issues, Senators and Representatives largely leave the District alone in the day-to-day operation of the city, exactly as intended by the Home Rule Act. Many state legislatures meddle even more, like New York's which denied New York City the right to even install cameras on its buses.
Nowhere can the benefits of the District's singular authority be better witnessed than in the city's transportation plans. Thanks to DDOT's authority over most aspects of transportation planning, the city has instituted a number of new projects at a breakneck pace. More bike lanes? Done. Express buses and priority corridors? Sure thing. Pedestrian safety enhancements? Intermodal transportation hubs? First in the nation to have bike sharing? Yes, yes, and yes.
Even the District's most controversial new transportation project, the 37-mile streetcar network, has been made more streamlined with only one level of government to approve and oversee construction of the new system. The District's comparatively small 13-member legislature (the 550,000 residents of Wyoming have a whopping 90 state representatives and senators) creates a local government with the potential to be very responsive to the demands of residents across the entire city. Just look at what GGW and other transportation activists were able to do in a few hours to save streetcar funding.
As stories emerge about the disconnect in priorities between our neighboring local jurisdictions and their respective state governments, the District benefits by having only a single level of local government to make decisions. The residents of Montgomery and Prince George's counties had to beg Annapolis to provide more funds for WMATA and ensure support for long-stalled infrastructure projects like the Purple Line. And, as recently reported, the state government in Richmond initiated a power grab to take away one of the last remaining vestiges of local government in Northern Virginia by demanding half the Commonwealth's seats on the WMATA Board of Directors.
If Washington were located in either state, residents might have been left waiting for decades before we saw even a single streetcar, expanded bike sharing service, or other necessary infrastructure projects due to competing state priorities. Does the District's fiscal situation have serious deficiencies? Yes. However, Washington's unique municipal government is perfect for advancing the type of progressive, forward-thinking projects in transportation, urban design, and economic development that could become a model for the rest of the nation.
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