Testimony of Ed Lazere, Executive Director, At the Hearing on the Fiscal Year 2013 Budget Support Act of 2012

Chairman Brown and other members of the committee, thank you for the opportunity to testify today.  My name isEd Lazere, and I am the executive director of the DC Fiscal Policy Institute.  DCFPI engages in research and public education on the fiscal and economic health of theDistrict of Columbia, with a particular emphasis on policies that affect low- and moderate-income residents. 

I am here to testify in support of the Revised Revenue Estimate Contingency Priority List included in the Budget Support Act.  I understand that the list needs careful review and that the DC Council will want to express its priorities on the list.  Indeed, the DC Fiscal Policy Institute has concerns about some items on the revenue priority list.  Nevertheless, DCFPI largely supports the list, particularly the items near the top that would restore cuts to critical services and support important initiatives to help children and their families succeed. 

While the Revenue Priority list is sometimes described as a “wish list,” it is decidedly not a list of luxury items. Perhaps most important, it would restore deep cuts to services that are on the chopping block this year or have been in recent years.  The proposed FY 2013 budget includes cuts to homeless services, even as the District struggles with a surge in homelessness among families with children. The budget also includes a deep cut to the city’s locally funded health insurance program, the DC HealthCare Alliance, and a 50 percent cut to the Housing Production Trust Fund. The revenue priority list would restore these and other cuts, including domestic violence services. 

The revenue priority list also would provide more money for a number of important initiatives, including a major re-design of the city’s TANF (Temporary Assistance for Needy Families) program for families with children. The new program aims to better identify the employment needs of parents and provide better training services, but the proposed TANF budget for 2013 includes no new funds to implement this effort.  It will be slowed without additional funds from the revenue priority list. The revenue priority list also would add funding to provide services to more children with signs of developmental delays.  Based on current funding, the District only provides services when a child is at least 50 percent delayed.  Other important items on the list would support DC’s growing community college and school-based mental health staff, among others. 

DCFPI of course supports efforts by the DC Council to fund items on the list when it adopts the fiscal year 2013 budget, rather than keeping them on a wish list.  We understand, however, that finding the level of resources needed to fund the items on the list will be hard to do.  Items that cannot be funded directly should be kept on the revenue priority list.

There are two particular items on the revenue priority list that I would like to discuss.  The first is homeless services.  Restoring $7 million to the program is number one on the wish list.  But even if this is funded, it will leave homeless services basically at current year levels, which are inadequate.  Homelessness among families with children has risen 75 percent since 2008, including almost 20 percent in just the past year. Despite expanding the DC General shelter, the city was overwhelmed this past winter, and it was forced to place hundreds of families in motel rooms. This added expense forced the District to close intake into family shelter starting in April and lasting until next hypothermia season.  Despite the Council’s goal when it adopted the 2012 budget to provide funding so that Priority One families would not have to be turned away, these families are being turned away.

The experience this year shows that the District needs a better plan to meet homeless service needs. A reliance on hotels for a large share of the homeless population is both expensive and provides poor-quality services.  Moreover, the cycle of sheltering families in the winter and then turning them away outside of hypothermia season is a situation that no one is happy with.  Addressing these challenges requires additional resources, but also a new approach that moves families from shelter to housing, places families in an environment where success is more likely, and also frees up shelter space for new families.  

The second item I would like to discuss is number two, $14.7 million for the TANF program.  As noted, these funds would be used to fully implement the new TANF employment program.  While DCFPI supports this goal, we are concerned that under current law, TANF benefits for roughly 6,000 families ‘ with 12,000 children ‘ will be reduced to as little as $257 a month for a family of three this October.  Most of these families will not be assessed under the new TANF employment program or referred to a new employment services provider before then.  Steep reductions in income are likely to create hardship for many families and make it harder for them to successfully participate in education or training programs. DCFPI believes that TANF reforms welfare-to-work efforts should give families the tools they need to succeed before imposing time limits that drastically reduce or eliminate assistance. 

We thus support using a small portion of the $14.7 million from the revenue priority list to delay benefit reductions until October 2013, with the majority of the funds still used for the TANF employment program.  This is not only a fair approach but one that is most likely to lead to better welfare-to-work outcomes.

Thank you for the opportunity to testify.

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