<DOC>
[106th Congress House Hearings]
[From the U.S. Government Printing Office via GPO Access]
[DOCID: f:56983.wais]
NEW VISIONS FOR THE DISTRICT OF COLUMBIA
=======================================================================
HEARING
before the
COMMITTEE ON
GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTH CONGRESS
FIRST SESSION
__________
JANUARY 22, 1999
__________
Serial No. 106-8
__________
Printed for the use of the Committee on Government Reform
Available via the World Wide Web: http://www.house.gov/reform
U.S. GOVERNMENT PRINTING OFFICE
56-983 WASHINGTON : 2000
______
COMMITTEE ON GOVERNMENT REFORM
DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York HENRY A. WAXMAN, California
CONSTANCE A. MORELLA, Maryland TOM LANTOS, California
CHRISTOPHER SHAYS, Connecticut ROBERT E. WISE, Jr., West Virginia
ILEANA ROS-LEHTINEN, Florida MAJOR R. OWENS, New York
JOHN M. McHUGH, New York EDOLPHUS TOWNS, New York
STEPHEN HORN, California PAUL E. KANJORSKI, Pennsylvania
JOHN L. MICA, Florida GARY A. CONDIT, California
THOMAS M. DAVIS, Virginia PATSY T. MINK, Hawaii
DAVID M. McINTOSH, Indiana CAROLYN B. MALONEY, New York
MARK E. SOUDER, Indiana ELEANOR HOLMES NORTON, Washington,
JOE SCARBOROUGH, Florida DC
STEVEN C. LaTOURETTE, Ohio CHAKA FATTAH, Pennsylvania
MARSHALL ``MARK'' SANFORD, South ELIJAH E. CUMMINGS, Maryland
Carolina DENNIS J. KUCINICH, Ohio
BOB BARR, Georgia ROD R. BLAGOJEVICH, Illinois
DAN MILLER, Florida DANNY K. DAVIS, Illinois
ASA HUTCHINSON, Arkansas JOHN F. TIERNEY, Massachusetts
LEE TERRY, Nebraska JIM TURNER, Texas
JUDY BIGGERT, Illinois THOMAS H. ALLEN, Maine
GREG WALDEN, Oregon HAROLD E. FORD, Jr., Tennessee
DOUG OSE, California ------
PAUL RYAN, Wisconsin BERNARD SANDERS, Vermont
------ ------ (Independent)
------ ------
Kevin Binger, Staff Director
Daniel R. Moll, Deputy Staff Director
David A. Kass, Deputy Counsel and Parliamentarian
Carla J. Martin, Chief Clerk
Phil Schiliro, Minority Staff Director
C O N T E N T S
----------
Page
Hearing held on January 22, 1999................................. 1
Statement of:
Rivlin, Alice, chair, D.C. Financial Responsibility and
Management Assistance Authority; Anthony Williams, Mayor,
District of Columbia; and Linda Cropp, chair, District of
Columbia City Council...................................... 22
Letters, statements, etc., submitted for the record by:
Cropp, Linda, chair, District of Columbia City Council,
prepared statement of...................................... 78
Davis, Hon. Thomas M., a Representative in Congress from the
State of Virginia, letter dated January 19, 1999........... 2
Norton, Hon. Eleanor Holmes, a Representative in Congress
from the District of Columbia:
Information concerning salaries......................... 83, 85
Prepared statement of.................................... 8
Rivlin, Alice, chair, D.C. Financial Responsibility and
Management Assistance Authority, prepared statement of..... 27
Williams, Anthony, Mayor, District of Columbia:
Information concerning attorneys fees.................... 105
Prepared statement of.................................... 44
NEW VISIONS FOR THE DISTRICT OF COLUMBIA
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FRIDAY, JANUARY 22, 1999
House of Representatives,
Committee on Government Reform,
Washington, DC.
The committee met, pursuant to notice, at 9 a.m., in room
2154, Rayburn House Office Building, Hon. Thomas M. Davis
presiding.
Present: Representatives Davis, Morella, Horn, and Norton.
Staff present: Peter Sirh, staff director, Howard Denis,
counsel, Anne Mack, professional staff member, Ellen Brown,
clerk, and Trey Hardin, communications director, Subcommittee
on the District of Columbia; and Jon Bouker, minority counsel,
and Jean Gosa, minority staff assistant, Committee on
Government Reform.
Mr. Davis. Good morning and welcome.
This hearing is being convened under the auspices and with
the cooperation of the Government Reform Committee. I am
grateful to Chairman Burton for his leadership in facilitating
this hearing, and I also wish to thank the ranking minority
leader, Henry Waxman, and all the members of the full committee
for their help.
Pursuant to the rules, I've been authorized to administer
oaths to witnesses. As per Chairman Burton's authorization,
this hearing will be conducted in accordance with the Rules of
the House and, to the extent possible, the Committee Rules of
the 105th Congress. Without objection, I ask Chairman Burton's
letter to me of January 19, 1999, be entered into the record.
[The letter referred to follows:]
[GRAPHIC] [TIFF OMITTED]65954.001
Mr. Davis. I look forward to continuing the excellent
bipartisan working relationships which we have enjoyed from day
one of this subcommittee's creation 4 years ago. I am so
grateful to the ranking member, Eleanor Holmes Norton, for
helping to make that possible, as well as my vice chairman,
Connie Morella, and my colleague, Steve Horn, who is here on my
left.
The District of Columbia Subcommittee is proud to have
played a constructive, bipartisan role in the revitalization of
the Nation's Capital. Back in 1990, the Commission, chaired by
Dr. Alice Rivlin, had warned of an impending crisis in the
District of Columbia.
By 1995 the District, and consequently the region, was in
the midst of such a profound crisis. The Rivlin Commission had
noted, to take just one example, that the District government,
even considering its county and state functions, had about 40
percent more employees then comparable cities. I stated in our
first hearing on February 22, 1995, that the District of
Columbia faced a spending problem of monumental proportions and
a management failure to enforce controls.
The crisis was so severe that the District government
couldn't deliver basic services. There were very real concerns
that the city would run out of cash to pay debt service or meet
its payroll. The District clause of the Constitution gives
Congress a unique role in the Nation's Capital.
I think we can all be proud of the responsible way in which
Congress has stepped up to the plate and worked together in
exercising this function. It's been my great, great pleasure to
work closely with my ranking member as we helped the District
alleviate the unprecedented crisis we found 4 years ago. I am
also grateful to the Clinton administration for working with
us. This could not have been done had we had both ends of
Pennsylvania Avenue going in the same direction.
Along with revising the District's budget process, we
created the position of Chief Financial Officer to work from
within the government. A window was opened to the Treasury for
dealing with the District's cash and short-term budget
problems, as well as the District's bond rating which had
slipped to junk bond status.
It was never our intent, nor do I believe that it should be
Congress' role, to involve itself intimately in the
relationships that were created within the city in such a
bipartisan fashion. Our purpose in acting as we did with the
passage of Public Law 104-8 was to create one team to rescue
and revive Washington, DC.
The legislation creating the Control Board and the position
of Chief Financial Officer was signed by President Clinton on
April 17, 1995. Anthony Williams was not appointed as Chief
Financial Officer until October 1995, but he was worth waiting
for. The Control Board and the CFO working together, helped the
District government to find weaknesses and implement solutions.
Mayor Williams, I say was worth waiting for. I think there's
some instruction there as you look for your chief
administrative officers; sometimes acting precipitously you
don't always get the best people right off and we learned a
lesson in getting you as CFO was a godsend.
Public Law 104-8 makes it abundantly clear that the CFO is
an organic part of home rule government. Nothing else would
make sense as the position is a permanent one, which will exist
long after the Control Board moves into its dormant phase.
As Chief Financial Officer, Tony Williams supervised and
performed the financial responsibilities of the Mayor, as well
as those duties normally assigned to a CFO. These duties
included tax collection and assessment, bill paying, approving
contracts, allocating available money in compliance with the
appropriations and ensuring that the budget is adhered to. In
Mr. Williams' testimony to the subcommittee at an oversight
hearing on March 19, 1996, he stated that his top priority was
to reestablish credibility by taking steps to improve the
District's financial management, and this was done.
Today we are very excited about the prospect of hearing
testimony reflecting the solid accomplishments and a real
surplus that the Control Board, the Mayor and all the City
Council and all of us who worked together to make positive
changes can take pride in having helped to achieve.
The MCI Arena and the new Convention Center project
wouldn't have been possible without the enhanced credibility we
achieved by working together to resolve tough issues. Passage
of the D.C. Revitalization Act of July 1997 moved us into the
next phase. We relieved the District of many of the fastest
growing items of its budget, putting the city in a far stronger
position to perform basic municipal services. Dealing with the
unfunded pension liability, closing Lorton, and striking a more
equitable balance with Medicaid helped to maintain our momentum
toward achieving economic recovery.
We are here today with enthusiasm and optimism. As now
Mayor Anthony Williams said in his inaugural address on January
2, 1999, this is indeed a time for renewal and recommitment. I
commend as well the City Council and its chair Linda Cropp for
working with us and for taking a positive bipartisan approach.
The phrase ``new era'' and ``new day'' is on everyone's
lips, and rightly so. I applaud the emphasis in Mayor Williams
inaugural address to basics, such as filling potholes and
sweeping streets, washing away graffiti, repairing road signs
and collecting garbage.
While we are gratified that crime is down and home sales
are up, we also recognize the continuing need to restore
Washington's image in the eyes of the world. So even though the
city is a far more stable place than it was 4 years ago, we
clearly have a long way to go. Regional priorities, such as
traffic congestion, must be addressed, to take just one
example. And whether it's traffic, economic development,
education or public safety, it has always been my philosophy
that we need a healthy city to have a healthy region.
Mayor Williams' action in requiring his cabinet members,
agency heads and senior staffers to come up with detailed plans
for improving services, to require department heads to sign
performance agreements is very intriguing to say the least.
I will be very interested to know how those agreements are
being implemented. Mayor Williams has put himself under some
deadlines and he established similar goals and targets as CFO,
and he was very able to achieve some very concrete solid
results.
The memorandum of agreement between the Control Board and
the Mayor has my full support, and I will be introducing
legislation with the ranking member, Ms. Norton, and vice
chairman, Connie Morella, to facilitate its provisions. The
time has come to shift substantial authority from the Control
Board to the city's elected Mayor and to give the Mayor the
greater flexibility he has sought over top personnel. In other
words, I want to give Mayor Williams the tools he has requested
to do the job.
I also expect to be introducing legislation to afford high
school graduates from the District of Columbia opportunities to
pay in-state tuition to State universities outside the city, so
they will have the same opportunities that people and students
in the other 50 States have.
I look forward to today's testimony as we proceed with our
joint efforts on behalf of the Nation's Capital, and I would
now yield to Delegate Norton, the ranking member of the
Subcommittee on the District of Columbia and our partner here,
for an opening statement.
Ms. Norton. Thank you very much, Mr. Chairman.
My sincere thanks to Chairman Tom Davis, who has initiated
this hearing so early in the 106th Congress allowing the new
Mayor, the new Council, through its chair, and the new Control
Board chair to affirmatively lay out their plans and ideas for
the District.
The officials who appear before us today have strong
records, both of bringing improvements to the city government
and of unequivocal support for home rule. All three have
demonstrated that the necessary reforms they are undertaking to
create a new resident oriented city government are part and
parcel of home rule and give self-government its essential
meaning.
Chairman Davis arranged a very good and encouraging meeting
with Speaker Dennis Hastert, Mayor Williams and me yesterday.
Speaker Hastert, the House leadership and others in the new
Congress have indicated that the Congress wants to help, not
hurt; to step up, not step in. However, for all the city's
traditional and justifiable concern about undue interference,
the truth is that full and permanent recovery cannot occur
without assistance from the President, the Congress and Federal
agencies alike.
We have already begun to think through how the Federal
Government may be useful in helping to meet a revenue gap which
may show up in a few years. The fiscal crisis that began early
in this decade forced the District into a one-sided focus on
the expenditure side at the expense of the revenue side of the
budget. That emphasis was in response to unusual amounts of
overspending that resulted in the loss of the most important
asset any city can have, a credit rating allowing it to borrow
money.
However, the city government, the Federal Government, and
the private sector are all now deeply engaged in planning an
action on the revenue side. For example, this week the Mayor
and I spoke at the opening of City First Bank, the first
community development bank to open in the District, a financial
institution that could not have been established without
assistance from the Federal Government, Georgetown University,
and several private financial institutions. Howard University,
Fannie Mae, and the District government have kicked off an
ambitious plan for home ownership and reinvigoration of the
historic neighborhoods surrounding Howard.
I have recently worked with private business interests,
HUD, and the District government to secure infrastructure funds
from HUD for a privately financed shopping center in ward 8. It
will house a 12-screen movie theater and a supermarket to
replace Safeway, the last remaining supermarket in the ward,
which precipitously left in October.
During budget negotiations in October, the White House
helped me get $25 million into our appropriation to fund an
economic development corporation. I very much appreciate that
Chairman Davis has indicated an interest in pressing a
District-wide enterprise zone, such as the one I proposed last
Congress. We already have evidence that new thinking on urban
tax policy can produce revenue for the District, and my $5,000
homebuyer credit has helped produce a home ownership boom that
is slowing the loss of the residents, including the middle
income population, whose flight has ravaged the city during
this decade.
These significant public-private initiatives are only a
small part of the mounting evidence that the District has
climbed out of its fiscal crisis and is unquestionably moving
quickly ahead. However, there are governance tools that the new
administration needs if it is to be held accountable and if
residents and the Congress are to be assured that revenue from
them will be productively used, not wasted in the bureaucracy.
The chairman has already agreed to the first such tool. I
very much appreciate that Chairman Davis has indicated that in
early February the committee will mark up the first section of
H.R. 214, the D.C. Democracy 2000 Act, which will become a
Davis-Norton bill and will go to the floor as one of the first
bills of the 106th Congress.
This provision puts into law what the Control Board has
already done in delegating to Mayor Williams the responsibility
for the nine agencies removed from executive control in 1997.
The bill also eliminates any doubt that the Mayor alone has the
power to hire and fire his cabinet and managers.
The heart of the District of Columbia 2000 Act is not yet
ripe. But I appreciate that the chairman does not have a closed
mind on whether the Control Board should sunset in the year
2000, a year earlier than anticipated.
I have proposed this provision, not only because democracy
delayed is democracy denied, but also because the District
already has significantly surpassed the goals set for it by
Congress. Instead of a balanced budget by 1999, the District
will have 3 straight years of balanced budgets plus surpluses
by 1999.
The Congress gave the city the authority to borrow to
eliminate its accumulated deficit, but the city will eliminate
that deficit without any borrowing. With the administration of
the city in the hands of a Mayor who came to office with a 3-
year management and financial track record in this city and
surpluses he helped produce, the burden should be on those who
insist on an un-elected overseer for elected officials.
Congress has been quick to criticize, even punish, the
District for low performance. Let us now see if Congress will
be as quick to recognize the city's concrete accomplishments
and a new administration with more than lip service when the
District outpaces congressional expectations and mandates.
However, from the beginning I have indicated I would not press
H.R. 214 until the city develops a track record that can
command passage this year.
It is difficult to get bills empowering the District
through the Congress and impossible without a strong case. I
believe that the city can accrue the necessary evidence in time
for the District's historic year 2000 on its own like any free
American jurisdiction. At the same time, the Mayor, the City
Council, and I are neither lulled by the present surplus
revenues nor naively optimistic about the city's financial
future. Part of the surplus consists of revenues that were not
spent because of operational problems in the District.
Further, in the face of wholesale flight from the city, the
good economy has kept revenues from reflecting the depth of the
loss of middle income taxpayers. We know what must be done, and
it is clear that our elected officials can do it. Some long-
term fiscal problems remain to be solved, but the fiscal crisis
that necessitated a Control Board is over.
Even the best run city government, however, will have to
work hard to convince the Congress that a payment in lieu of
taxes or a substantial Federal payment is not only fair, but is
necessary.
At an appropriate time, I expect to work with the Mayor,
the City Council, and Chairman Davis on how to achieve reliable
and regular revenue sources for a city without a state and
without the power to tax commuters. Today, I welcome Mayor
Williams and Financial Authority Chair Rivlin in their first
appearance in the Congress in their new roles, and Council
Chair Cropp once again to the subcommittee.
I look forward to today's hearing, particularly for the way
it begins to lay the groundwork for the appropriate return of
authority and hopefully new assistance to the District. I want
to note that, among those in attendance in this hearing are
Councilwoman Charlene Drew Jarvis, Councilman David Catania,
Control Board Member Eugene Kinlow and Statehood Senator Paul
Strauss.
I thank you, Mr. Chairman.
[The prepared statement of Hon. Eleanor Holmes Norton
follows:]
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Mr. Davis. Thank you very much, Ms. Norton.
Let me recognize our vice chairman, Mrs. Morella, for any
comments she may wish to make.
Mrs. Morella. Thank you, Mr. Chairman.
This is pretty exciting. Here we are together considering
new visions for the District of Columbia. I want to welcome our
panelists, certainly welcome our new Mayor, Anthony Williams
and welcome Linda Cropp, who is here with us, who is the chair
of the District of Columbia City Council and, of course, Alice
Rivlin, chair of the D.C. Financial Responsibilities and
Management Assistance Authority. We've spread that title out.
I'm very proud to serve on the District of Columbia
Subcommittee and certainly very proud of the achievements that
have been made to add to the luster and strength of the
District of Columbia. As a result of the D.C. Revitalization
Act, the Federal Government has relieved the District of
certain burdensome expenses, such as the unfunded pension
liability and the Federal Government has also assumed a larger
share of the Medicare costs and has taken over the operations
of the prison system.
Relieved of these cumbersome administrative tasks, local
officials are now able to concentrate on the daily operations
of the city. The city government can devote more time to
improving police and fire services, collecting trash, fixing
potholes, maintaining neighborhoods, and improving schools.
These are the toughest tasks of all and the most important
because they touch the lives of everybody on a day-to-day
basis.
This hearing does mark a new beginning; although we
continue our bipartisan efforts from the 105th Congress, we do
so with a refreshing new landscape. As the Chief Financial
Officer Anthony Williams has testified before this subcommittee
on many occasions. This is the first time that he is here today
as Mayor Anthony Williams. I'm certainly pleased to welcome him
in his new role.
Although Mayor Williams has been on the job for less than a
month, he's already made a difference. I, too, applaud him for
his commitment to fix potholes, sweep the streets, pick up the
garbage, rid buildings of graffiti. It has been gratifying to
see him with rolled up sleeves pouring over city documents and
directing his staff to improve city services in a timely
fashion. And I even note in today's Post, too, the Mayor's
commitment and demand for a better short-term action plan from
city agency directors.
Yes, he's tough on others, but he is just as tough on
himself. I look forward to working with Mayor Williams and also
with the City Council, its great members and its very able and
effective chairman, Linda Cropp.
There is much to be done, although I want to make it clear
that I strongly believe that Congress should not try to
micromanage the District of Columbia. That would be
counterproductive, would encroach on the legislative roles of
the Mayor, the City Council and the Control Board. We can,
however, be helpful in many ways. And like you, Mr. Chairman,
and Ms. Norton, I think it's time to restore substantial
authority from the Control Board to the newly elected Mayor and
to give him the flexibility he needs to effectively fulfill his
role.
I also want to commend you, Mr. Chairman, for the bill that
you're about to introduce to give high school graduates in the
District of Columbia the opportunity to attend State
universities throughout the country at in-state tuition rates.
It looks like a really good and fair proposal, and I'm pleased
to be a cosponsor with you, and I want to work with you in any
way I can to get the legislation passed and implemented.
As a former teacher, I'm most concerned about the status of
education in the District of Columbia. At the hearing last
September on the District of Columbia school system, I was
alarmed at the declining test scores in math and science of
students in the poor sections of the city. Thousands of D.C.
students are leaving school without the fundamental skills
needed to find a job and function as productive members of
their communities. Consequently, there are a high number of
unemployed workers in the District who are undereducated and
undertrained, unable to meet the emerging technological needs
of the workplace.
We must work together to find a way to break this cycle of
failure and defeat. The present economy is an information
economy. People who can process information to develop goods
and services and use technology effectively will excel in the
next century. We must prepare those who are undereducated and
underserved so that they, too, will be prepared for the new
economy.
It will mean lower taxes, better services, a higher quality
of life, not only for the District, but for the region as a
whole. In addition to work force development, there are many
critical regional issues that challenge us to work together as
a team, traffic congestion, growth management, water and air
quality and getting our computers ready for the year 2000.
I look forward to the testimony from our excellent panel. I
want to thank you, Mr. Chairman, for holding this very
important meeting and for your leadership, Ms. Norton's
leadership and Mr. Horn's leadership.
Mr. Davis. Thank you very much, and let me now introduce my
distinguished colleague from California Mr. Horn, whose family
roots go back deep into this city.
Mr. Horn. 1840's to be exact, and I'm the only one who
hasn't been born here but I went 1 year to high school here,
Mr. Mayor. And this has been a great city over the years and
the members of this subcommittee and the Speaker are very
committed, as the previous Speaker was, to help the government
be a very responsive government.
I congratulate you on your excellent record in the past as
a public servant. I know you bring tremendous skills to the
leadership and chief executive of this city and not too many
mayors have had your experience. So you're way ahead of the
game. And I've gone through your program proposals. I think
they're excellent.
And I think you need the power to appoint, to discipline,
to remove managers, not only at the top level, but also in the
intermediate level. I remember one of the things that took me 5
years to get accomplished from the board of trustees of the
California State University system and that was to provide
flexibility of management. We could appoint, we could remove,
and we could pay according to their commitment on a particular
contract, 6 months, 1 year. In other words, we provided a
results-oriented government. We asked: what are you going to
accomplish in this time period? I believe that you should be
the judge of whether or not your managers have accomplished
what was agreed on their contract. That will turn a bureaucracy
around very rapidly.
I think also that what you've said in here about children
and health is very important, and recreation. And I would hope
that the neighborhood school, which is really the visible
aspect of government for people around them, would be able to
combine health services at the local level, recreational
services after school. Schools seldom have their lights on
after 3 p.m. The community should be able to use those playing
fields for little children under appropriate supervision.
As I mentioned to your predecessor Mayor in one of these
hearings, I stood for 3 hours in line in a sports shirt. No one
knew I was a Member of Congress, and I just wanted to see how
people were treated. The motor vehicle department was not
treating them very well in that northeast operation; one, they
didn't even have their people informed as to what kind of
service was there.
So I happened to stand for 3\1/2\ hours after asking five
people who said, ``oh, yes, this office will do that,'' and
then when I finally get to the window, it was sorry, it is
5:30--that's over in the municipal building.'' That's not very
good; 200 citizens that day were standing in the heat, no one
from management came out to say, ``come on in, we're going to
cue you up and it's cooler in here than it is out there.'' The
signs were misleading. The security guard was helpful, but
untrained.
So a little bit of initiative obviously was needed, and
several hundred residents, black and white, in this city
weren't too happy with their experience. Neither was this
Member of Congress.
Economic development I think is key. And I recall when
Disney was talking about desecrating a few Civil War
battlefields to bring the feeling of history to people who had
come to Washington.
Washington is where much of our history has occurred and is
occurring. Disney ought to be approached to build in the
District of Columbia. That means Disney building new housing as
a condition for them to occupy certain land. It means jobs for
the citizens of this District.
As for the public schools, the Mayor of Chicago has taken
over education, and so should you. That will place
responsibility.
I know you have the interest. I think any powers we need to
give you we should give you. And somebody mentioned
micromanaging, my last micromanagement would be one pothole at
Independence and 3rd----
Mayor Williams. Take that address down.
Mr. Horn. It just about took my axle out the other night,
Mr. Mayor. But you have my strongest support. Anything I can do
to help, I will.
Thank you, Mr. Chairman.
Mr. Davis. Thank you very much, Mr. Horn.
I just want to note for the record, although Mr. Horn who
had grandparents who were born in the city, parents born in the
city, kids born in the city, Mr. Horn wanted to be born in the
city, but he thought it was more important to be with his
mother on that important day, and he couldn't be here.
I would like to call our panel of witnesses to testify: Dr.
Alice Rivlin, the Control Board chair; Mayor Anthony Williams;
and the City Council chairman, Linda Cropp.
As you know, it's the policy of the committee that all
witnesses be sworn in before you testify.
[Witnesses sworn.]
Mr. Davis. Thank you. You can be seated.
I ask unanimous consent any written statements be made a
part of the permanent record.
We will begin with Dr. Rivlin, who needs to leave by 10:30.
Dr. Rivlin will be testifying before this subcommittee for the
first time; followed by Mayor Williams, who will be testifying
before the subcommittee for the first time as Mayor; and City
Council Chair Cropp, who is now a frequent visitor and has
testified before this committee.
Dr. Rivlin.
STATEMENTS OF ALICE RIVLIN, CHAIR, D.C. FINANCIAL
RESPONSIBILITY AND MANAGEMENT ASSISTANCE AUTHORITY; ANTHONY
WILLIAMS, MAYOR, DISTRICT OF COLUMBIA; AND LINDA CROPP, CHAIR,
DISTRICT OF COLUMBIA CITY COUNCIL
Ms. Rivlin. Thank you, Mr. Chairman. I'm delighted to be
here in this capacity. I think the citizens of the District may
not realize how lucky they are to have the strong,
constructive, bipartisan leadership of this committee helping
us as we move into our new era.
It's also a pleasure to be on this panel with the new Mayor
of the District, Anthony Williams, and with the chair of the
Council, Linda Cropp. I think the District is very fortunate,
and I say this even when I'm not with them, to have such
strong, qualified elected officials at the helm to lead us as
we move into this new era of effective, responsive city
government.
And, Mr. Chairman, I do believe we are entering a new era
in the District. There is renewed energy in the city and a
sense of hope that the cooperative efforts of the District, the
region and the Federal Government will help us build on the
progress that the Nation's Capital has made in the last few
years.
The District of Columbia Financial Responsibility and
Management Assistance Authority, and I never can get through
that whole title, affectionately known as the Control Board,
has enormous respect for Mayor Williams. My four colleagues on
the board and I are working hard to build a collaborative and
constructive relationship with him.
We're also working closely with the new Council. The
Council has three energetic new members elected in November.
Both the new and the returning Council members are endeavoring
to build on the positive results that the city has recently
achieved. Altogether, it is a promising time to be working for
the revitalization of the Nation's Capital.
As you have noted, Mr. Chairman, the Authority was created
by an act of Congress in April 1995 to assist the District in
restoring financial solvency and improving management
effectiveness. At the time, the District was virtually
bankrupt. It was unable to pay its employees or its
contractors. It was running a significant operating deficit and
had a large accumulated deficit. Since the District's bonds
could not be sold at market rates, the U.S. Treasury was the
city's only source of funds.
Moreover, the District at that time was not responding
adequately to the needs of its citizens. Streets were filled
with potholes and often went unplowed in winter. Citizens
seeking ordinary services, such as motor vehicle inspections or
building permits, encountered long delays and often confused
records. Medical care for the needy, child welfare services and
assistance to the elderly were often lacking and inadequately
provided. Crime was rising. Neighborhoods were decaying. The
public schools were deteriorating. Residents and businesses
were fleeing the city.
Now, nearly 4 years later, the District is in much better
shape. Thanks to the efforts of many people, including the
former members of the Authority and my predecessor Andrew
Brimmer, Mayor Williams in his former position as CFO, members
of the Council, the President and the Congress, the District
has not only stemmed the deterioration, it has considerably
improved its overall condition.
When the books are closed on fiscal year 1998, which ended
in September, they will show that the city ran an operating
surplus for the second straight year and was able to pay off in
its entirety its accumulated deficit. The city has greatly
improved the integrity and internal controls of its budgeting
process and financial systems. The bills get paid, the taxes
are collected, and the District's securities sell at market
rates. From a financial standpoint, the city's comeback has
been remarkable.
However, while--and there's always a however--while the
fiscal progress has been gratifying, it is important for
everybody to understand that the city still faces an uncertain
financial future. Its tax base is narrow and can grow only if
vigorous efforts to attract new residents and enhance business
opportunities are sustained and successful. Deferred
maintenance and inadequate investment have left a legacy of
decayed and outmoded infrastructure, from bursting pipes to
leaky roofs and decrepit or nonexistent computers, and that
will take substantial resources to put right.
Similarly, while the quality of the District's public
services has demonstrably improved--and those lines,
Congressman Horn, are shorter than they were before--much
remains to be done. In response to the National Capital
Revitalization and Government Self-Improvement Act passed by
the Congress in 1997, the Authority has in the past year laid
the groundwork for long-term, sustainable improvements in the
quality of public services. Through the process of management
reform and the establishment of a chief management officer to
focus on service delivery improvements, the District has made
measurable progress in the quality and efficiency of service.
In recognition of the new era in the District, the
Authority and the Mayor have signed a memorandum of agreement
describing their new relationship. The memorandum makes clear
that, while the Authority retains all of the responsibilities
under the statute, the Mayor will be in charge of the day-to-
day running of the city and supervision of executive branch
departments. The Mayor will also have the responsibility for
program and policy matters related to the departments and
agencies. There must be no confusion about who is in charge of
delivering services, the Mayor is.
The memorandum further states that the Chief Management
Officer will report to the Mayor and that most government
agencies will report to the Mayor through the CMO. The
agreement calls for the Mayor to combine the existing authority
and staff of the city administrator with those of the CMO.
The Metropolitan Police Department and the Office of
Corporation Council and some smaller agencies will report
directly to the Mayor. The public schools will continue to
report to the Authority. The agreement can be revoked by either
the Authority or the Mayor with 30 days' written notice.
To ensure effective communication and cooperation, the
Authority has invited the Mayor to attend meetings of the
Authority in a nonvoting capacity. And we have also extended
the same invitation to the chair of the Council. We have met
three times under the new arrangement, and we are communicating
very well.
I am very pleased by the strong working relationships that
the elected and appointed officials of the city are developing.
We have found shared purpose and common ground in our efforts
to improve the District. Together, we are already working to
achieve consensus in such areas as the fiscal year 2000
financial plan and budget, strategic plan priorities for the
District, the National Capital Revitalization Cooperation and a
strategy for accelerating economic development.
The Mayor has publicly stated his strong intentions to make
immediate improvements in public services, and Authority
members have told the Mayor that he can count on our full
support in his efforts to improve the quality and performance
of government services. The faster the better. All of us look
forward to cleaner and safer streets and alleys, more
responsive public officials, a safety net that is compassionate
and timely, and all of the other things that citizens expect
that their local government will effectively provide. We
believe visible short-run improvements are feasible, but we are
also conscious that many aspects of the D.C. service delivery
are still deeply broken and will take sustained effort to
repair.
The Mayor and the Council and the Authority are also
working together on long-term priorities for the District.
One of the fundamental goals we have all agreed on is
accelerating economic development. The District, through a
collaborative process with the private sector, nonprofit
organizations and community groups, recently issued an economic
development strategy that focuses on a list of specific actions
to leverage jobs and growth in the city. We view this approach
as the beginning of an intensive effort to make the District
more attractive to new business, retaining those businesses and
Federal agencies that are already located in the city and
creating greater opportunity for neighborhood development, not
just activity in the central business district. It is vital
that we focus our attention on economic development.
Other long-term priorities the Mayor, the Council and the
Authority will stress in the coming months include improvements
in financial management, tax reform to create a more equitable
structure, targeted investments in technology and other
infrastructure areas and the widespread improvement of public
services. We will give special emphasis to investing in our
young people and the skills and vitality of our work force.
The Authority is working closely with Superintendent Arlene
Ackerman to strengthen the D.C. public schools. There is no
question that, as Congresswoman Morella has noted, that our
ability to build a bright future for the city and to keep and
attract residents requires quality public education and safe
schools. We are optimistic that the strides made in the last
year to rebuild decaying schools, make facilities safer and
increase the quality of education are laying the groundwork for
sustained improvement in education; and we are working closely
with the Superintendent, the Emergency Transitional Education
Board of Trustees and the elected school board to make that
happen.
Finally, the District must make the transition to normal
governance. This city, like every other city in America,
deserves to be managed by professional managers responsible to
elected officials who, in turn, are responsible to an engaged
electorate. Democracy is the cornerstone of our Nation's
heritage; and the District should be an example of how well
democracy can work, not a shameful exception.
We all recognize that the District is our Nation's Capital
at the same time it is a local community. As such, it occupies
a unique and sometimes complex place in our governmental
structure. The District is fundamentally intertwined with the
Federal Government. The city's prosperity, its well-being, its
future are all influenced by how we interact with the Federal
Government and responsibly steward the resources that support
the city, both as a community and as a capital.
In 1995, and again in 1997, the Congress was sufficiently
concerned about the condition of the District that it passed
laws aimed at improving the financial and management health of
the city. The laws stipulated that control periods would remain
in force--and the Authority would remain active--until certain
conditions were met. The District was required to first run its
operating budget without a deficit for 4 consecutive years and
to repay any borrowings by the Authority. More general
provisions of the law mandated that the District improve the
quality of its public services and strengthen the structure of
government in the city and help sort out the functions between
the District and the Federal Government.
Mr. Chairman, the District is on its way to accomplishing
the goals and objectives of the congressional statutes, but let
me stress that we're not there yet. I've highlighted some of
the achievements today and some of the issues we will be
working on in coming months. Through the cooperation that the
Mayor, the Council and the Authority have established, I
believe we will continue to make progress in meeting the goals
set by the Congress so the District can make the transition to
normal government as soon as possible. I know the Mayor and the
Council chair join me in welcoming the
opportunity to come back to the Hill and report to the
subcommittee as we move toward the statutory objectives that
will bring about a timely return to normal governance.
Thank you, Mr. Chairman.
Mr. Davis. Dr. Rivlin, thank you very much.
[The prepared statement of Ms. Rivlin follows:]
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Mr. Davis. Mayor Williams.
Mayor Williams. Yes. Mr. Chairman and members of the
committee, Congresswoman Norton, Congresswoman Morella,
Congressman Horn, it's a pleasure to testify here again to the
general committee not as CFO to the District, but as Mayor.
It's a real honor to be on the panel with Chairwoman Cropp and
Chairwoman Rivlin.
And I have a power point presentation I would like to make
that states our vision for the Nation's Capital, the progress
we've made, current efforts under way and where we see
ourselves going.
First, to talk about progress, we can go to the next slide.
We talk about the financial health and, just to reiterate
briefly, we have balanced the budget of our city for the past 3
years. I would argue that we've gone further and faster than
any other American city in a financial recovery. We have in
1998 retired an accumulated deficit we inherited of $350
million, with a surplus on top of that without any resort to
financing of that debt. So that was done the old-fashioned,
hard way.
We've received a ratings upgrade of the District's bond
rating and in our last transaction actually had a transaction
that performed at an investment grade in practical reality.
We received a clean audit in our last financial statement
and look forward to having one in this financial statement with
a lot of hard work.
We have generated a budget surplus of at least $400 million
in 1998 and, as I stated earlier, have eliminated that
accumulated deficit.
We've also made progress in public safety. Homicides in the
District have declined 46 percent since 1991 and are at their
lowest levels in 12 years.
Violent crime is down 19 percent, property crimes have
declined, and there's also been a decline in total crimes
committed.
Our new police chief, who I think is really setting an
example of standing up, taking responsibility and taking
charge, has announced that a captain is going to be assigned to
every watch; and I think this will further strengthen the lines
of accountability.
We have got a lot further to go. He is the first to
recognize that. But I think he is really a model and an example
of where our agency heads to go.
And I might add, our agency heads have a way to go. The
action plans that we receive from our agency heads needed work.
They didn't have the breadth and the depth that I expected, but
I did not characterize and I would not characterize those plans
as shoddy. Because, you know, as I'm going to discuss in a
second, I'm the coach of a team now, the District government.
I'm proud of my team. In the locker room, there's going to be
an exchange and probably it won't be pretty and you wouldn't
want to televise it, but out on the field, I take
responsibility for my managers.
Going on. We want to foster a strong Federal relationship,
developing the role initially of the Federal Government as a
good corporate citizen. I've traveled to cities around this
country looking at best practices. Many of the Mayors in these
cities are very envious of us because, unlike any cities like
Philadelphia or Detroit, we didn't lose a huge manufacturing
job base in the city. We still have a job base from the Federal
Government.
The Federal Government, whether we like it or not--and I
happen to like it more than not, it depends on the day--is our
No. 1 corporate citizen. And we want to foster that
relationship. And one of the key ways to do that is responding
promptly and professionally to Federal requests and offers of
assistance.
Too often in the past, there have been offers of assistance
or have been entreaties from the Federal Government generally
or from the Congress or from individual cabinet departments,
and phone calls that haven't even been answered. We've got to
change that.
We want to be a true model for other cities in our
relationship with the Federal Government and proactively engage
Federal agencies. If there is any discretionary Federal grant
out there in any of the cabinet agencies, we want to be first
in line. Not that we're going to elbow other cities out of the
way, but we're going to definitely use our proximity to these
Federal departments. That's a competitive advantage we have,
and we take it very seriously.
A vision for our government--I've stated it for 6 months
now. Many people are tired of hearing it. But I think it
remains one government, good government and self-government for
our city. One city and one government focused on major policy
initiatives, whether they be in the areas of labor, whether
they be in the areas of continuing management improvements,
whether they be in the areas of health care or education or
economic development, one city and one government should meet
these challenges.
Restoring faith and confidence in our government by major
service delivery improvements and, finally, unifying our
government and creating a foundation for lasting self-
government.
To talk about one city and one government briefly, it's a
vision of, very, very importantly, public/private partnerships
coming together to meet the challenges that confront our city.
I think everyone would agree that to do the things we have
to do in our city, whether they're meeting the needs of
children, rebuilding the human services network, that where one
half of it has been placed practically in Federal receivership,
focusing on the needs of work force development or our workers,
economic development, health care, all of these things are
going to take the government working with the community,
working with our nonprofit institutions, working with the
private sector, to successfully realize the government cannot
do it alone.
Some of our major initiatives: One major initiative, as
I've stated many times, is that our children are our future;
and that includes providing a safe, clean environment for our
children, providing after-school programs for our children,
again in the partnership that I talked about and, very, very
importantly, supporting children in a neighborhood context, in
a community context with the faith community and the other
sectors I've talked about providing that whole continuum of
education, including programs for healthy children, school
readiness programs, looking at our parks and libraries to see
that they're doing their job to support our children and, very,
very importantly, supporting our parents so that our parents
understand and are oriented on what it means to have a child in
school and what those expectations should be.
Some initiatives on rebuilding the human service network.
Again, in partnership; the government cannot do this alone. And
I will also state, rebuilding this network is going to
require--and this is a theme that will come up again and
again--is going to require some choices. There's no silver
bullet. If there were an easy choice, if there were an obvious
choice, it would have been made by now. So it's going to
require some choices.
But it involves providing quality health care to the
greatest number of our citizens to support our other policy
initiatives. It means meeting our children's needs before,
during and after school. It means supporting our mothers
initially and then families as a whole in moving from welfare
to work. And, very, very importantly, it means utilizing more
effectively the Federal money we're now receiving for drug
treatment and prevention. We receive a significant amount of
money from drug treatment and prevention, and we can do a
better job with it.
Work force development is very, very important to me. Work
force development to me is essentially focusing on the issues
of pay and the issues of performance. And both must go
together. It's not simply an issue of we're going to have more
accountability and workers have to do more and leaving it at
that. It's really combining both of those tools together.
It includes managed competition. It includes effective
labor agreements, working in partnership with labor, not only
on a general management level but, most importantly, down in
the agencies where the results are actually going to be
achieved.
It means focused and effective training for our workers,
each worker having a customized, individual training kit, a
development program, if you will, that that worker can pursue,
with the support of management, to realize that worker's aims--
that employee's aims and our agency and our government's aims
as well. It also means, very, very importantly, the information
systems and the communication systems to support what our
workers are doing.
As a former CFO and as a former background manager, if you
will, I am a strong, fervent supporter in the groundwork that's
been laid by the management reform program and the need to
continue these long-term investments. The last thing I want to
do as Mayor, in focusing our short-term visible concrete gains
that I believe we can realize, is to do that, rob from the
longer term management improvements I think we know we all
need. And I echo what Alice Rivlin said in that regard.
Continuing on in economic development. It's defining the
role of our city as the vital center of a regional economy;
it's spurring growth; it's achieving jobs for District
residents not only in our city but in our region. It's
developing our city as an international trade center,
recognizing we have the largest diplomatic community in the
world. And, finally, appointing a Deputy Mayor for Economic
Development who can coordinate not only the planning and
development functions but also those functions with our tax
programs that, as you know, have a major impact on investment
decisions to stay or leave our city.
It's a matter of leveraging public-private partnerships,
restructuring the Grants Management Office and related
processes, putting them on a fee-for-service program, for
example, trying to utilize, to the maximum extent possible,
every Federal dollar we have available, establishing budget
priorities that leverage and that reflect these partnerships
that I talked about.
Health care priorities I talked about, and I will just
mention briefly again. It includes children, our low-income
adult population and our elderly, very, very importantly,
again, a whole continuum of health care making the choices we
have to make over the next year to really focus our precious
health care dollars. And that means bringing together our
private service providers, our HMOs, our labor unions, our
public hospitals, Medicaid. I think I've gotten every one
together on a health care strategy for the District.
Service delivery improvements. Much has been stated about
service delivery improvements and their role in creating both
an investment climate in our city and, very, very importantly,
restoring hope and confidence in our government.
And I mentioned some of the things that we're focusing on
right now, including streamlining the business licensing and
permitting process; establishing effective and reliable--or
improving--making more effective and reliable our trash
collection; cleaning streets and alleys; paving roads. They're
all listed here. All of these are the kinds of visible,
tangible, concrete improvements that we are working for with
our agencies.
And just to give you some illustrative examples in public
works, licensing and permitting. In public works, for example,
it's a matter of conducting a customer service survey to
establish a baseline measurement of where we are with the
public. It's a matter of implementing managed competition
programs in selected areas and in most of these areas where
government isn't even doing the work right now. So in many
areas it's not a matter of outsourcing what employees are doing
but it's a matter of extending government's reach and
government's impact in our neighborhoods in innovative ways.
It's a matter of increasing the involvement in the private
sector and internships and mentoring and partnerships. And
it's--very, very important when we talk about public works--a
matter of partnership with the community. Not to get graphic,
but rats eat food left by someone, you know. Trash on the
streets doesn't fall from the sky. It comes from somewhere. So
those partnerships are very, very important.
To continue on, on a short-term improvement tool kit, I've
asked our agencies to come back to me with action plans that
distinguish between short-term, visible, concrete results and
the longer term strategies our agencies are working on and that
I strongly support. But to distinguish the two and in working
on these short-term improvements to reach into a tool kit, I
want to provide them to make sure that these things happen.
And I list some of them here, you know: Asking what your
customers want; thinking first about what your customers want;
thinking about how you can do more with less.
In many, many instances we're going from a situation over
the last 3 years in our government of where we were getting
less for more to where, in the short-term, we're getting more
for more and to where, ultimately, we want to get more for
less. That's kind of a continuum we're going around. We're
telling them to use existing resources, to reach for the stars,
to take a chance, to measure their progress, to lead by doing.
Very, very important in talking about that tool kit.
The long-term tool kit includes the area of managed
competition, identifying the functions where our employees can
be given the resources and can compete. This isn't a matter of
taking jobs held by good, diligent government workers and
shipping them to Indonesia or something. It's a matter of
competing, giving our employees the resources and the tools to
compete.
And what I found looking closely at other cities is that we
don't lose thousands of good-paying jobs for our workers, but
what we do get is we get better quality at lower costs for our
citizens, and our employees have pride in the work that they're
doing.
The longer-term tool kit also includes a personnel
assessment, asking each of our managers to conduct this
assessment and to maintain this assessment, not just to ensure
accountability but again to support the individual training and
development needs of our employees and giving them the
resources they need.
I list some of the others here. I think the committee, and
I know because of its work in general oversight, is well
familiar with performance measurement, activity-based costing
and the need for cross-cutting governmental cooperation.
On this next slide, I just briefly try to distinguish
between the short-term action plans and the long-term action
plans. In the short-term action plans, I am talking about time
lines of anywhere from now to 1 year, and I am stating that we
have to show our public visible improvements beginning in 6
months. And I keep clarifying this, we are talking about
visible improvements realized within 6 months. I am not saying
that the city will be completely fixed within 6 months.
We are talking about using existing resources. We are
talking about an infrastructure, emphasizing enhanced
management, redeploying existing resources. It is a matter of,
as I did as CFO and now as Mayor, working very closely with the
financial authority, very closely with our managers in
personnel and procurement and technology to see that we have
the supply lines to get these management changes done quickly,
because often the snags are in procurement or personnel or some
of these cross-cutting support functions.
Priorities is focusing on improvements visible to the
public; I just distinguish in the long term by focusing on
priorities. In the long term, we are focusing on priorities
that are internal, that are background, that support, day by
day, the short-term initiatives, but are nonetheless very, very
important.
To give you an example would be the work that we are
putting in phones, for example. We want to put in place over
the short term measures that will give our citizens prompt and
professional response to their phone calls, and I honestly
believe that this can happen within 6 months.
On the other hand, I strongly support efforts to put in
place the technology and the resources to give all of our
citizens one-stop 311 inquiry into our government. Now that,
longer term, is going to take resources and it is going to take
long-term initiative. It is going to take some improved
technology. The short term is going to take some improvisation
and entrepreneurial leadership and know-how. I think we can do
both.
Talk about unified government, Congresswoman Norton has
spoken to this and so has Alice, and I think the need by this
Mayor and this government to command the respect of our country
and support the return to full self-government for our city, to
support the statement that democracy can work in our city. And
democracy working in our city is not just a question of our
government working effectively; it is a civic culture and civic
leadership working with our government to show that we all
working together that can make this thing work.
As I state here, it is important for the executive to
regain statutory authority over agencies and their personnel;
and I think Members have spoken to this, and I believe that is
a first phase in our effort to return self-government to our
city, that this is sorely needed, that we need this restoration
of accountability and faith in elected leadership as a
foundation for the kinds of independence and self-government
that we are talking about.
We have spoken to the memorandum of agreement. I would
simply state that on the memorandum of agreement much has been
stated about the need to give the Mayor this hiring and firing
authority, and I strongly support that. I believe it is
necessary. But having said that and without contradicting
myself, I have got a very, very close working relationship with
the financial authority, a good working relationship with the
Council, and on a day-to-day basis, I think the job is getting
done. So I don't want to leave this committee with the feeling
that the job is not getting done and I can't do my job without
this authority, but that authority would enhance the ability to
move forward on some of these changes.
As I state here on this slide, I fully support returning
the statutory power to the Mayor taken in the Revitalization
Act, and that this effort to bring the Control Board into a
dormant status 1 year ahead of schedule is supported by this
Mayor with the understanding that this Mayor not only supports
the long-term improvements that have been initiated. I really
do believe that, but this Mayor also supports, having been the
independent CFO, a strong CFO function in our city and a strong
management function in our city.
Now, we are looking for a full-time city administrator and
we are going to look all over the country for a full-time city
administrator. In the interim period, yours truly, with the
help of an expert team of advisers and assistants, is going to
manage the government. We are going to do this with outside
help and with help from the Federal Government and with
assistance that we have tapped from throughout the government
to give us the day-to-day cooperation of operational
responsibilities, to give us the ability to proactively push
this change agenda.
So, saying that over the next 2 months, however long it
takes to bring a city administrator, I am going to manage this
government is not to say that I am going to micromanage this
government. Those functions are going to be delegated out to
selected individuals of the kind that I have talked about. But
I do think that it is very, very important in this period for
us to bring to this management change agenda, both in the long
term and actually in the short term, something that we have had
missing; and that is something that I think only elected
leadership provides, and that is leadership. We can have great
plans, we can have great organization and great controls, but
without leadership on the ground in the agencies, we are not
going to get where we need to go.
Some people have said, how are you going to do that without
completely robbing yourself of any public contact. What I
envision is pushing these changes through the agencies, working
in the agencies, meeting with employees and doing what I did as
CFO. I had 60 ``brown bag lunches'' with employees as CFO. I am
going to have the same kind of contact with employees as Mayor,
working with labor unions, working with the employees on the
ground, seeing how they do their jobs.
I am talking about improving phones; I am going to answer
the phones. I am talking about sweeping the streets; I am going
to go out there with our agencies and sweep the streets. We
talk about citizen contact; our citizen contact is going to be
geared toward working with our neighbors on neighborhood
strategies to improve how government services our
neighborhoods, working with neighborhoods to take greater
responsibility to improve things like graffiti, clean streets
and very, very importantly, working with our neighborhoods to
get their input on what these short-term plans should be. So
this is not robbing ourselves of this critical element of
support to get this job done.
I am excited about the opportunity that the citizens of the
District have given me and this unique opportunity we have to
work in partnership with this Congress, as we have had with the
administration, and to work with the Financial Authority, Dr.
Rivlin and Chairman Cropp.
So I thank the committee and look forward to answering your
questions.
Mr. Davis. Thank you very much.
[The prepared statement of Mayor Williams follows:]
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Mr. Davis. Chairman Cropp.
Ms. Cropp. Thank you Chairman Davis, Congresswoman Norton,
Congresswoman Morella and Congressman Horn. It is a pleasure to
be here before you. I am joined by the chairman pro tem of the
Council, Charlene Drew Jarvis, and Councilmember David Catania.
The inclusive approach of the new Financial Management
Authority under the leadership of Chair Alice Rivlin serves
this city extremely well, and the Council looks forward to
working with our new Mayor, Tony Williams, as together we meet
the needs of the citizens of the District of Columbia.
Let me briefly review how we got here and then give you the
Council's perspective on where we are going. As you know, many
of the problems encountered in the District of Columbia have
been similar to those faced by other urban cities during the
past 2 decades. Other problems have been structural and unique
to the District as a city that is not part of a State within
the United States--the unfunded pension liability, the
escalating costs of the State-like functions such as Medicaid,
the prisons and courts, the inadequate revenue base. Most
similarly situated cities, no matter how well managed they
were--and admittedly we have had some management problems--
would not have been able to survive under the same
circumstances as the District has had. In fact, I would suspect
that some of the cities probably would not have been able to do
as well as the District has.
The camel's back was broken in this city by the early
1990's, but the straws have been piling up for a long time, and
I am happy to say that the camel is now standing up again and
we are moving in the appropriate direction.
The Revitalization Plan of 1997 addressed some of these
issues. Thank you. Thank you for your help in that, Mr.
Chairman, for the leadership, for your leadership, and also for
the Members of Congress who helped us address some of those
very crucial structural issues. We applaud our Congresswoman,
Eleanor Holmes Norton, for her role in that.
Without Federal reassumption of the pension liability that
the home rule government inherited the reality is by the year
2004, the District would have faced a $5 billion liability,
costing the District over three quarters of a billion dollars
every year, and this problem was not of the District's own
volition.
Much progress has been made during the past couple of years
with the Council, the Mayor and the Financial Authority playing
a role. Certainly the consensus budget that has been developed
was extremely helpful. We can finally see light at the end of
the tunnel, and this light is not a train coming directly at
us.
Painful but necessary reductions in programs, services and
personnel, better management of the city finances, the
Revitalization Plan and the good fortune of a healthy national
economy have all contributed to our recent progress from the
brink of bankruptcy with no access to the credit markets and
with a $536 million accumulated deficit in 1995 and an annual
budget deficit of over $100 million, to paying off the entire
debt within 3 years without borrowing and to a current budget
surplus of over $400 million. That was not an easy feat. It is
not one to take lightly. It is one that truly needs to be
applauded.
The fact is that the District has recovered from its
financial crisis. We are exceeding the tangible measures that
Congress itself established to return limited home rule to
elected officials and to allow the Financial Authority to
become dormant; elimination of the accumulated deficits, access
to Wall Street credit markets, and 4 consecutive years of a
balanced budget. 1998 was our 2nd consecutive year of a budget
surplus. This year, 1999, will also end in a budget surplus.
We still need to make much more progress in managing our
government and improving just very, very basic municipal
services--public schools, public works, public safety.
Substantial improvements are necessary in all of these areas,
but particularly in education. This is needed to retain and
attract many more residents and businesses in the city and
thereby expand our revenue base, which is critically necessary
to our long-term financial health. In this regard, let me
express my appreciation to your proposal, Congressman Davis, to
provide District high school graduates the ability to attend
public universities in States across the Nation and in State
tuition rates. This will be very helpful to us, and we at the
local level need to ensure that our students are academically
qualified to attend these universities.
At the same time, we have our own local university that we
must also strengthen and make sure that that option and the
option of other universities, which are economic engines in the
District, also remain viable.
The Revitalization Act's bifurcation of the management of
our government was frankly not helpful in ensuring effective
service delivery, nor was the trifurcation of the bureaucracy
with the establishment of a CMO, but we are pleased that the
Financial Authority has returned the day-to-day operation of
the nine agencies and the four cross-cutting agencies to the
elected Mayor of the District of Columbia. As Mayor Williams
has stated, one government by elected officials helps to ensure
good government because the citizenry then has knowledge and
the power to hold their elected officials accountable for the
effective delivery of public services.
The Council is committed to working side by side with Mayor
Williams and Dr. Rivlin's Financial Authority in achieving both
short-term and long-term positive visible results for both our
residents and our businesses. All of us know what our problems
are. We have a zillion reports. I am up to the gazoo with
reports of the problems that we have and the recommended
solutions.
The renewed Council is definitely about the business of
joining our Mayor on the playing field, as he says, to keep
moving the ball forward toward the goal of solving our city's
problems. The Council will be a constructive partner in this
effort. While the Council may not always agree with the Mayor
or the Financial Authority on everything, and while we will
continue doing strong legislative oversight, we will all
continue to be at the table and on the field working hard with
all of our private and public stakeholders to ensure the
progress of our city.
Over the past year, the Council has passed significant and
crucial legislation impacting the District of Columbia as a
whole. It has been an extremely hard-working council, playing a
major role in leading the government toward positive change.
Just as we continue to help improve the functioning of
government agencies, we can demand no less of ourselves as a
council. And in that light, 6 months ago the Council initiated
a comprehensive study of our own operations and organization by
the National Conference of State Legislatures. This study is
only a part of the ongoing process to review and reform our
legislative operations so that we, like the rest of the
government, can optimize our performance.
The executive knows that it needs to speed up the
implementation of the business and regulatory reforms that have
been enacted by the Council in the past year. These reforms,
along with the pending release of the $25 million in Federal
funds for the National Capital Revitalization Corp., will
greatly facilitate economic development throughout the city,
which has been synergized by the exciting downtown projects
like the MCI Center and the new Convention Center.
As we revitalize and we deal with economic development in
the downtown area, it is extremely crucial, if we would like to
see a truly revitalized city, that we also look at the
appropriate development of our neighborhoods, for it is the
strength of the neighborhoods, the communities, and the local
communities that will help make the city as a whole strong. You
cannot just have development downtown, not in the
neighborhoods, and expect the city as a whole to grow and to
develop.
The Council knows that it needs to legislatively build upon
the important reforms which we enacted in the procurement,
personnel, and workers compensation areas by adopting
meaningful tax legislation as well. We simply cannot compete
for more businesses and residents without addressing local tax
issues that need to be addressed. Tax reform is part of our
agenda.
So this year's budget process, even with a substantial
surplus, will be a difficult but an extremely important one,
because we have to do a lot of things at once. And we will have
to make choices, because we cannot afford to do everything that
needs to be done. After paying off our debt, we have to set
aside a rainy day fund for unforeseen expenses that will
inevitably occur when there is a downturn in the economy and
less revenue is coming in. We also need to improve dramatically
the provisions of municipal services, and we have heard our
Mayor talk about that and his desire and will to move in that
direction.
We also need to continue to upgrade our work force and both
our physical and technological infrastructures need vast
infusions of funds after years of no investment or deferred
maintenance. We also should probably establish a sunny day fund
to take advantage of unique opportunities that arise to
maintain or attract major businesses.
Finally, as I just said, we need to begin local tax reform
to help grow our economy on the long term. What we are
experiencing now will probably not remain, and we need to be
prepared in the future for what happens. So the priorities are
many and the choices will be difficult, but that is why we are
here.
The Council also would like to initiate a locally based
process of reviewing the District of Columbia's home rule
charter. In the past, there has been some trepidation to
opening up the idea of charter review, frankly out of fear of
what might happen in the Congress. However, during the past few
years not only has that door been open, but quite frankly, the
Congress has blown the roof off, so we might as well locally
look at this issue, review it with our citizens, have input and
make some very important decisions with regard to our charter.
You know, most States review their constitutions at least
once every 20 years. It has been 25 years since the Home Rule
Act was first adopted by Congress. And as we prepare for the
return of the limited home rule in that act to elected rather
than appointed officials, it is probably a good time for a
citizen-based effort to review the provisions of that act with
an eye toward changes that might be beneficial. For example,
something just as simple as changing the title of the leader of
the legislative body of ``chairman'' to a title that may be
more gender neutral will probably also be more appropriate.
Also, as the Mayor has talked about ensuring the
independence of the city's Chief Financial Officer, the
citizens and the Mayor may want to ensure that there is a
certain independence of that office, and perhaps other offices
such as city administrator, by being the body that steps into
the role of the current Financial Authority. But these are
issues that should be debated, discussed and decided upon by
the local citizens, and we hope that this effort will start.
In addition to local governance issues, we need to revisit
other structural problems that the District of Columbia has
that relate to our relationship with the Federal Government
which are not addressed or which have been exacerbated by the
Revitalization Plan, and probably in the future we will get
more into that. But the Federal Government payment, as you
know, is supposed to compensate the District for the 41 percent
of the property base of the Nation's Capital that is tax exempt
and receives local services. The elimination of the Federal
payment coupled with the continued unique Federal prohibition
of the District taxing income at its source where two-thirds of
the income earned, even by our own government employees--not
private sector, not Federal Government, but our own--severely
restricts the city's revenue base. We in the District continue
our quest for budget and legislative autonomy. I hope that as
we look at this, we will have congressional support in this
area.
The District, unlike most other cities, operates a very
costly inpatient mental health institution, St. Elizabeth's,
which no other city has to operate. Additional Federal measures
are needed to expand our residential and business resident base
such as Congresswoman Norton's 15 percent Federal flat income
tax for District residents.
Last, voting representation in Congress must be provided
for our District residents. We must finally bring full
democracy to the residents of the Nation's Capital.
In closing, let me say that prior to and since the
enactment of the Financial Responsibility and Management
Assistance Act, the city has gone through some rocky times,
some challenging times, and some creative times. We are now
entering a new era which all of us here at this table recognize
is a transitional time. Implicit in the word ``transition'' is
the concept of rebuilding bridges, of moving toward the day
when the governance of this city is by locally elected
officials who are accountable to our citizens. A lot of things
still need to be done, but the first step of recovery from our
financial crisis has been accomplished. Implementation of
reforms and service delivery improvements are ongoing; and we,
the Council, the Mayor, and the Financial Authority
collectively have the vision and the commitment to work
together toward a renewed and revitalized District of Columbia.
Thank you for this opportunity to testify before the
Congress, and of course I am available for any questions.
Mr. Davis. Thank you.
[The prepared statement of Ms. Cropp follows:]
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Mr. Davis. Because of Dr. Rivlin's time constraints, we
want to move very quickly to some specific questions for her,
and then we will ask questions of the Mayor and the Council
chair.
Now, Dave Clark, the former chair of the D.C. Council,
never complained about the name of the Council or suggest that
we change it, but maybe it is something we ought to look at,
and I think we have a couple of Members who would be happy to
look at that request. Let me start with Ms. Norton who has some
specific questions for Dr. Rivlin.
Ms. Rivlin. Thank you.
Ms. Norton. Thank you. I do have a question that has to do
with the Control Board here, and it is also for the Mayor.
Let me first recognize that State representative Tom Bryant
has come in, and we are glad to see him here.
Let me ask all of you a question about the surplus.
Dr. Brimmer has announced a $400 million surplus. I have to
look to the officials who are in charge of whether or not there
is a surplus for accurate information on this, and so I am
going to ask you what is your best and most accurate estimate
of the budget surplus for 1998?
Will it be more than $400 million, or less, or do you
simply want to confirm Dr. Brimmer's figure?
Ms. Rivlin. We don't have final figures yet, Congresswoman
Norton. He is in the right ballpark. You have to remember that
he is talking about the operating surplus. From that has to
come the repayment of the accumulated deficit, but we will have
a positive fund balance.
Ms. Norton. I am, therefore, forced to rely on Dr. Brimmer.
I am asking for your best and most accurate estimate. Perhaps
Mr. Williams, perhaps Chairwoman Cropp can answer. Should I
look to Dr. Brimmer for this information?
Mayor Williams. I think the Congress ought to look to us
for the financial information, as to what is happening, along
with the CFO in the District.
Ms. Norton. So what is the answer?
Mayor Williams. Operating, it is at least $400 million. I
would be shocked if it were something different.
Ms. Cropp. I think the only reason that we probably have
not said specifically at this point is because the full audit
has not been completed, but it is in the process.
Ms. Norton. When do you expect that audit to be available?
Ms. Cropp. February 1.
Ms. Norton. Thank you.
I would like to ask that my first slide be put up.
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Ms. Norton. First, I want to say that I have full
confidence in the Control Board, and the question that I am
going to ask really goes to the actions taken by the last
Control Board, and my concern is not with a particular
official, nor do I want to second-guess what the Control Board
has done with respect to the Chief Management Officer. I am
enough of a lawyer to know that there was a contractual
obligation there. One of the problems that the last Control
Board had is that it went willy nilly ahead and got itself into
lawsuits.
I am concerned with whether or not the first Control Board
has built into the salary schedules of the District of Columbia
a structural problem. To find out whether this was the case,
the only place I know to look is at market rates, that is, to
compare yourself with similarly situated folks.
Now, the first schedule on the screen shows you the salary
of the D.C. Chief Management Officer that was negotiated by the
first Control Board to be greater than the salaries of chief
administrative officers in all of the surrounding jurisdictions
of the United States, the nearest available markets, so that
the District of Columbia had by far the highest with $155,000
for a population of 540,000. Compare that to Fairfax people,
which has almost twice as many people, 914,000 people,
$147,000. Compare that with Montgomery, 826,000-plus, or even
with Prince George's, 770,000, and you can see the figures down
that we are way above them.
Moreover, the history of the first board--and this is
relevant to the Mayor because we are about to give the Mayor
back what would amount to this authority, albeit with the
oversight of the Control Board because it involves money. But
the history we are talking about involves not only these
salaries but something that rarely happens in government, and
that is negotiating large severance packages to outgoing
managers. For example, Superintendent Franklin Smith, $180,000;
former Inspector General Angela Avant, $90,000, this is
severance going out. Former Head of Housing and then Consumer
Regulatory Affairs, David Watts, $121,000; former DPW Cell
Bernardino, $60,000; Cheryl Dotson, a sole contract person,
$250,000.
Now, let me have the second slide. To show you my concern--
where is the second slide?
Ms. Rivlin. Congresswoman Norton----
Ms. Norton. I want to get my question out.
To show you my concern, my concern is not with a particular
officer but with a perhaps systemic problem.
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Ms. Norton. The second slide shows the salaries of
representative D.C. government managers to be far greater than
the average salaries for cities of comparable size. And if you
look at those officers--chief administrative/management
officer, chief financial officer, director of public works,
planning and economic development, personnel--if you go down
this slide, you will see that our salaries are 1.7 times
greater, 1.4 times greater, sometimes two times greater, far
greater than cities of comparable size.
First, are you aware of a provision that was placed in the
D.C. 1996 appropriations bill that prohibits funding during any
fiscal year employees or contractors whose employment with the
District of Columbia is no longer required, and was that
considered at the time when these severances were paid out?
The only exception provided in this 1996 provision in the
appropriations bill was to services already provided to the
District government. Was this provision known or did you
consider using it? Will it be used in the future? How are we to
justify these salaries? How are we to know that these are not
simply built into the structure so that instead of meeting what
I usually meet here, which is that our City Council, has the
highest salaries in the United States, something that I am
confronted with all the time--higher than New York, higher than
California. Now I am going to be met on the floor with--and so
are all of the officers, so are all of the managers and all of
the Cabinet people--much higher for large cities and cities of
comparable size. I need to know what is the response I am going
to give back when I meet that in the face of these statistics?
Ms. Rivlin. Congresswoman Norton, I am not familiar with
the provision, and I hadn't seen these numbers before, but let
me say that the effort to find very highly qualified people to
run a complex government that has had very serious managerial
problems is not an easy one, and the previous Control Board
faced the issue of talking very qualified people into coming
into admittedly a very difficult situation and taking over.
Mayor Williams will face the same problem, and trying to
get absolutely the best people that we need to run the city
will, I think, take looking at who is available and who is
willing to come and paying salaries that are sufficient to
attract the talent that we need.
Now, with all due respect to the chairman, I actually think
it is probably easier to get somebody to run Fairfax County
managerially than the city of Washington for reasons of
complexity and----
Mr. Davis. Let me intervene. There is a huge deferred
benefit package that is not included in the Fairfax situation.
So taking a look at the total salary is not an appropriate way
to look at the total benefit package, which includes
hospitalization and retirement benefits. It may include a
severance agreement and the like.
Ms. Rivlin. But let me say that I think these are
interesting numbers and that we would like to answer the
question in writing and to look at the comparability. But one
has to be careful in making comparisons that you are really
comparing the same things, and that we put ourselves in a
position as a city of attracting the best people because we
need help.
Mr. Davis. I think one of the biggest problems we have in
government today is salary caps; we have it at the Federal
level. If we are going to get the best and the brightest in an
information age, we are going to have to have a benefits
package that is comparable.
Ms. Norton. Could I just ask that you submit to the
committee your view of the 1996 provision in the appropriation,
whether it was applied and whether it will apply in the future.
Second, let me say that I could not disagree more with the
notion that it is harder to attract people here than to Fairfax
County or to any other comparable city in the United States.
Let me say why.
I believe if you come to the District of Columbia, which is
the center of the universe, when its government is on its knees
and you show that you can do your stuff here--not in Fairfax,
not in Indianapolis, but in the District of Columbia--you are
made for life.
So instead of bargaining, ``Can you please, Mr. Whoever-
you-are, can you come and help us?'' we need at the table
people who say, ``Let me tell you what you get for coming to
the District of Columbia, what a showcase this is for you, and
what will happen for you if you succeed,'' not ``Please help
us; we will pay you any amount.''
And I am very disappointed if your answer is--because my
question was a systemic one, and it was no criticism of the
payment to any particular person, but I am very disappointed if
your answer is this is what it takes to attract talent to the
District of Columbia, because I do not believe that you can
make the case that, with tough bargaining, that indeed will be
the case.
And so I am going to have to ask finally if Mayor Williams
can give me any greater assurance with respect to these
salaries already built in. Mr. Mayor, we are talking about
people who, for example, in some cases were sitting on the job
when the city went down, who got $20,000 increases instantly
from the Control Board.
Mr. Davis. Let me allow Dr. Rivlin to leave.
We appreciate you being here. We may have some other
questions that we will submit in writing.
Ms. Rivlin. Thank you. I am sorry that I can't stay.
Mayor Williams. Labor economics here, supply and demand, I
think when our management and our city were in crisis--I was
former CFO--it was hard to get people, and I was criticized for
paying people what were considered to be exorbitant wages, but
they got the job done. I will say what is past is prologue.
Now I think we are creating a situation where we can be
competitive and attract the best and the brightest, and we can
buildup competition for these jobs because people want to be
part of a change effort, and I think we can begin to see some
decline in this overall scale. I do believe that. Not getting
into what happened in the past, but prospectively.
Ms. Norton. Thank you.
Mr. Davis. Mr. Horn, do you want to start questions?
Mr. Horn. On this salary thing, I have listened to that
over the years in legislative bodies of one sort or another,
and I agree completely with what Dr. Rivlin said and the
chairman. If you are really serious about a salary study, look
at the total benefits package. And while I share the view of
Delegate Norton that people should step up to the plate and
make this a better city, and they would be made elsewhere.
There are only a few of us that self-flagellate ourselves,
and you are looking at one that would take that challenge. But
don't expect the average person, who has a lot of places to go
to be a first-rate city manager, to do that. And if you are
going to pay him or her a salary here, you might start
deducting what it costs to get a bulletproof vest, whether it
be coming to Congress or just walking the streets of
Washington.
I think this is the kind of thing that we hear all the time
in Congress from some people. It is an easy shot at public
officials to be sort of throwing out the salary.
You have to pay a salary for good people or you are not
going to get them. And if you are not willing to pay $10,000 or
$20,000, more than other cities for a particular job, it is
just pound foolish. You have to have good middle managers or it
isn't going to happen.
The Mayor can't sit there and micromanage the whole city.
He has to depend on people with vision, people with guts,
people who are not afraid to make personnel changes. They can't
all land on his desk. And if those people can't do it, he has
to deal with those officials and get them out of there and get
new people in there.
It won't pain me if he has a clean house in a few months,
but that is what needs to be done in a city or a university or
a corporation when you are trying to turn it around; and that
is why a chief executive gets paid what they get paid, and that
is why a competitive administrative person would get the same
thing as either a county executive or a city manager. And I
think a lot of this is just the easy thing to potshot in town
meetings and all of the rest of it.
Let me ask a question, Mr. Mayor, on your own situation.
How do you evaluate the work product of the Water and Sewer
Authority? Are they making enough progress in repairing the
progress of water main leaks? Have you had a chance to look at
that yet? Because here we are spending probably thousands of
dollars every week on Capitol Hill having bottled water shipped
in here because although the Corps of Engineers delivers and
outstanding clean product to Washington, as well as to the
surrounding suburbs, the fact is in Washington's case the
distribution system just hasn't been kept up to date. And that
seems to me to be something very important in the
infrastructure capital plan; we need to systematically work at
that. Do you have any feelings on that?
Mayor Williams. I am spending my initial time on the
agencies for which I am directly responsible, and then we will
be working on to the independent agencies and make sure that
they are coordinated with this change agenda and moving forward
in the same fashion. I have not really delved deeply into Water
and Sewer, but I will say this. I think that initially Michael
Rogers, and now the present management, is moving Water and
Sewer years and years ahead of where they were; there is no
doubt in my mind. And they have put in place a plan to begin
infrastructure improvements and, very importantly, management
change efforts over there.
I do think that there is a new spirit of accountability
that I have seen over the last couple of weeks where we had a
number of water main breaks. Citizens complained, and what they
got was the usual finger-pointing. Over a week or two, after
some phone calls and some discussions, there has been a new
attitude of people willing to take responsibility for getting
these things fixed. That is, I think, an early indication that
things are going to be moving in the right direction.
Mr. Horn. The National Park Service unveiled a plan last
month to build a parking lot and certain other facilities under
Pennsylvania Avenue in the vicinity of the White House. This
follows the closing of Pennsylvania Avenue a few years ago, an
action which severed a key east-west transportation link in the
city. What is your view of the current situation regarding
Pennsylvania Avenue and the National Park Service plan for
parking in that area?
Mayor Williams. Closing Pennsylvania Avenue has had a major
negative effect on the overall transportation in the District
and the marketplace in the District. It is my understanding
from briefings that E Street is going to be reopened--I am not
sure exactly what the date is--so that will allow two-way
travel.
But Pennsylvania Avenue, my general belief is--and this is
as part of a long-range agenda with the Federal Government--
there has got to be a way that we can use modern devices to
protect our President. We all want to do that while at the same
time providing this critical east-west link in our city.
Mr. Horn. I agree with you on that. They have legitimate
security concerns in that area, and with the nuts roaming
around this world, one can't be too careful.
Ms. Cropp. If I may, I concur with the Mayor on that. While
we do need to look at the security of the President, it is
really important that we open up an east-west linkage across
our city. E Street, there is no reason why the traffic cannot
move east to west. Because we have traffic moving from the west
going east, obviously traffic is flowing there. It would
significantly have a positive impact on our traffic flow if it
could be two-way, the traffic is moving one-way, unless we are
saying that a nut would only come from one direction, because
the traffic is moving.
Mr. Horn. Well, I think you make a very good point, and I
wish you well, as one that drives in that area fairly
frequently.
I think you probably share high respect for Mayor Rendell
in Philadelphia, as I do. He is a very impressive mayor and has
been before our committee. How do you think his philosophy of
rejecting tax increases and emphasizing public-private
cooperation, does that apply in the District of Columbia, do
you believe?
Mayor Williams. I think it definitely applies. I think to
attract better investment, we have to improve the services of
this government. We always call it the three publics--public
education, public works, public safety--are the kind of
foundation. We need better economic execution of a strategy. We
are beginning to do that.
We also need to lower business costs, and a key way to
lowering business costs is on the tax side. And in my mind,
lowering that cost for business is going to be a partnership
between our city and the Federal Government.
I support the legislation that has been introduced--will be
introduced by Congresswoman Norton that would relieve a lot of
the tax pressure using Federal resources. I think we need to
complement that on our side using our precious ability we have
to lower taxes, to focus that tax reduction initially on
smaller businesses; and I think you will get relief for
individuals coming from the Federal side and relief for smaller
businesses coming from the local side. That, coupled with what
we are doing to improve service, I think then you have a
tremendous climate for investment in our city.
But adding to the tax rates, to me is a stupid way to bring
more revenue to our city because it is short-term gain, long-
term pain.
Mr. Horn. Mayor Steve Goldsmith of Indianapolis is another
mayor, for whom I have high respect. We have had him visit my
city of Long Beach, CA, which is about the size of Washington,
450,000, major ports, major aerospace industry and so forth.
And as you know, Mayor Goldsmith has encouraged a competitive
bidding process for a lot of city services. I don't know to
what extent that might be on your agenda, but I am curious, is
that an option?
Mayor Williams. Again, I talked at length about managed
competition in my presentation, and I think that is something
that we want to pursue very aggressively in our city.
I am a big admirer of Mayor Goldsmith and his hands-on
approach to his management. He permanently has no city
administrator. He manages his city himself. He didn't even have
a chief of staff for some time. I am not arguing or advocating
that, I am just talking about a temporary situation, but I just
want to put that into the record.
But when he first came to Indianapolis, his approach was
just to privatize everything. It was only after some experience
with that outright privatization approach that he began to
fashion what he has became known for and what Indianapolis has
become a mecca for; and that is--I think he said they had 3,600
people visit Indianapolis to look at their approach to managed
competition. It is giving his employees and his unions the
resources to compete, exposing them to competition. They have
kept many of those jobs and functions. They are doing a better
job at less cost, and I think there is a direct, relevant
example for us in the District.
Mr. Horn. And he has the unions on his side now.
Thank you.
Mr. Davis. Mrs. Morella.
Mrs. Morella. Thank you. I want to thank Chairwoman Cropp
and Mayor Williams for their testimony, and also Dr. Rivlin.
Mayor Williams, last month you met with officials in other
cities. I am curious not only what you learned from those
meetings, and some of it was in your response to Congressman
Horn, but I am interested in hearing from you about your
meetings regionally with county executives from Prince George's
County, Montgomery County, and with representatives from
Virginia. Have you devised methods of working together, and if
so, on what issues? Will you be meeting regularly with them?
What enlightenment can you give us in terms of regional
cooperation?
Mayor Williams. On regional cooperation, as I have stated
many times, I believe that our city has to define itself as a
vital center of a regional economy competing in a global
economy. And I say ``vital center'' because this has got to
work for the gain of our city as it works for the gain of the
region. So I am not interested in exporting jobs out of my city
or exporting revenue out of my city, no mayor would. But I
recognize in this global economy, there are mutual gains in us
working together.
Certainly, and I have seen this with Mayor Rendell and
Mayor Archer, there were mutual gains where we work together to
bring new investment to the region. Clearly there are
opportunities there.
Dennis Archer is an inspiration to me. He has forged a
regional alliance. And you could argue that the Detroit region
has been much more punishing to him than it has been to us,
given all of our history and legacy, because of that huge
manufacturing job loss, that huge flight of residents over--
about half of the population. But they are working on a
regional basis to compete. I think we can do that.
I think there are options for mutual gain in
transportation, not only transportation as it benefits the city
because, you know, I talked to the mayor in Indianapolis. If
you live 90 miles outside of Indianapolis, it takes you 90
minutes to get into town. If you lived 90 miles from
Washington, DC, it would take you 3 or 4 weeks to get into
town, given the transportation. That is the strategic
opportunity we have in Washington, DC, to bring people back
into our city; and I think there is potential mutual gain for
all of us in that.
There is also mutual gain for us in transportation. Our
regional economy, one of the hottest in the world--we are one
of the largest centers of technology on the planet, in many
areas of our region we have practically negative unemployment.
If we can, as part of a welfare-to-work strategy, develop
public-private partnerships with firms out in the region and
work with WMATA and private sector firms to provide better
transportation for our residents, that is a great gain for both
of us, because our residents and our city are getting jobs.
Firms out in the region are getting dedicated employees, and it
is a win-win for everyone.
Down in Phoenix, I saw examples of where they have got the
city of Phoenix, Tempe, Arizona, Scottsdale, and all of these
different towns around Phoenix. There are no boundaries when it
comes to deployment of fire and emergency services. Basically
all of the fire and emergency services on a real-time basis are
deployed all over that region according to need, and I think
there are areas of cooperation between our District and the
region, the same way that Fairfax and Montgomery cooperate. I
think Montgomery and Prince George's cooperate in that fashion,
and I think we can cooperate in this fashion as well, again for
mutual gain.
Sharing training facilities, working together on
purchasing, recognizing the fact that we want to support our
businesses and give our businesses opportunity, there have got
to be opportunities for joint purchasing where all of us can
benefit.
Those are some of the things on my agenda that I want to
push individually in meetings with executives when we meet, and
collectively when we meet on a monthly basis.
Mrs. Morella. So the ``big four'' are all going to be
involved?
Mayor Williams. The ``big four,'' but I also look forward
to meeting with the folks in Prince William and Loudoun County.
Mrs. Morella. Good. Traffic congestion remains one of the
biggest concerns in the region and certainly in the city. The
city has to be more user friendly to the residents and
commuters, and particularly during the rush hours. What steps
do you think should be taken, or maybe you have something
planned to address the problem, because I would also ask, are
you working with the Secretary of Transportation, Rod Slater?
Mayor Williams. We have a very, very good relationship with
each of the Cabinet secretaries and with the White House task
force headed by Carol Thompson Cole and Jack Lew. They have
been very supportive.
What we are trying to be is very proactive in our relations
with them. So it is not just a matter where they have an idea;
we are trying to be much more responsive in getting that idea
out on the street, but at the same time coming to them with an
agenda of where they can be helpful.
So, for example, in my charge to the agencies to come up
with short-term action plans, one of the specific things that I
asked them was, show me where you need more flexibility, show
me where the Federal Government can provide in-kind resources,
show me where in your action plans what you are doing can be
complemented by what one of the Federal agencies is doing. And
they are coming to me this weekend with that list, and I will
be going forward to individual departments, as well as this
task force, with this agenda, again to make improvements on the
street.
Transportation, in particular in my mind, with the police,
it is a matter of focusing on customer service. You know, if
you have a traffic jam and the officer is focused on whatever
the officer is focused on and is not focused on relieving that
congestion and that traffic jam, that is a question again of
this customer service focus, because you have a lot of drivers
here who need some help.
Ms. Cropp. If I may add to that, the earlier question asked
by Mr. Horn, one of the things that we need to do is look at
the E Street dual traffic. That will certainly help downtown.
The Department of Public Works is looking at better
synchronization of our traffic signals. That is an issue that
will help with the flow of traffic, particularly during work
hours, as we improve our technology. That will have a
significant impact.
In addition, we need to look at something that we have that
is working quite well for expansion and enhancement, and that
is our Metrorail system, which is one of the best in the world.
We need to look at ways to expand it as our population
throughout the region becomes more mobile. There is an article
today about expansion in the Tysons Corner area. We need to
look at expansion for the Red and Green Lines and encourage
more carpooling.
If we take a multipronged approach with regard to our
traffic signals and looking at our traffic patterns,
particularly where you can help us with E Street, and that
really has made gridlock occur downtown with Pennsylvania
Avenue and E Street. It has impacted traffic from Independence
Avenue straight up past K Street, and that is a large segment
of this city that impacts not only the District of Columbia,
Montgomery County, but also Virginia as people try to move in
that direction. So I think that will play a significant role.
Mrs. Morella. I agree, education, traffic congestion are
two critical issues which affect everybody.
My time has expired, but are you Y2K OK? I heard a comedian
last night say something about, I asked somebody about Y2K and
they wondered if it was a new cereal on the market.
Mayor Williams. One of the mayors I talked to said he had
no Y2K problem, because the cards in the shoe box were working
just fine. But for us, we have a good technology officer. She
is getting some added help from the Federal Government, and I
believe that with the Herculean effort we are going to put in,
as every jurisdiction will be putting in, we will be all right.
We will be happy to report in more detail.
Mrs. Morella. Steve and I co-chair the task force, and the
Federal agencies are supposed to be compliant by the end of
March; and I would hope that the District of Columbia would
also be compliant by that time to allow some time for testing.
I would very much appreciate, and I think this whole
subcommittee would, your having that person get back to us with
their report and the contingency plans.
Mayor Williams. In many cases, we are putting in new
systems off the shelf which, by their nature, are Y2K-
compliant. So we have kind of benefited from the fact that our
systems were so far behind we needed to replace them anyway.
Mrs. Morella. True, but that requires resources on your
part, too, so one has to be ready for it. Thank you.
Mr. Horn. Watch the new systems. We had one Federal agency
give us that answer a few years ago, we're getting a new
system, it'll be OK. They never checked. They never tested the
new equipment to make sure it was 2000 compliant. It was not so
your people ought to run tests through there before accepting
it.
Mayor Williams. OK, that's a good point, Congressman.
Mr. Davis. Thank you.
Mr. Mayor, just a few questions.
Let me begin with commuter and traffic issues in the city.
I would say the city has had a generally good response from the
District Police but there have been a few bad episodes through
the years.
We had a problem a few years ago with people blocking the
bridges and we felt the city was slow to respond. I think we
were able to work that out.
We had the slug lines where the city police were moving
them and which created a little bit of chaos.
We had the spot checks on the seat belts, which crippled
this city one evening.
We had the bridge jumper, which was a tough issue all the
way through that I think in retrospect would have been handled
differently.
We just want to make sure as we look for regional
cooperation in these issues that your police are sensitive to
the issues of moving traffic in and out of the Nation's
Capital.
Traffic is bad enough, and when you get somebody pulled off
the side of a road or anything like this, it just cripples it.
That is true within the city as well as out. I just want to
emphasize that we've talked about that and I know we're in the
same queue.
If you really want the city to succeed, than you want
businesses to go downtown. They have to be confident that their
workers are going to be able to move in and out about the city
in a constructive manner. So I just want to emphasize that
point.
I know we're on the same page on that kind of issue, but we
keep getting every few months something that perhaps could have
been handled a little more sensitively and differently. I know
you're sensitive to that, but we just want that to be a
priority for the city and for the region. I know it's going to
work.
Mayor Williams, do you have any plans right now to propose
any tax cuts? You mentioned shortly after the election you
would be seeking some tax cuts for small technology firms and
other businesses. As you know yesterday in our discussions with
the Speaker, Delegate Norton and I were forceful in trying to
expand some of the Federal tax breaks that the city receives
now throughout the city. We think this could be very helpful in
having the city attract capital in that area.
I just want to know, is it too early now to get into any
specifics? What's your thinking on that? I will ask Ms. Cropp
the same thing.
Mayor Williams. Right. In my vision, there's an overall
package of tax relief for our city. There are tax reliefs for
individuals. A home buyer assistance is certainly welcome. I
didn't really take a policy position, but supported it as a
candidate, support it as a Mayor. Progressive flat tax, I
certainly support as a former development official, as Mayor,
extending economic empowerment incentives, the capital gains
provisions in our city. That's the Federal assistance side of
it.
Again, I think my own policy preference--but this is going
to be a discussion with the Financial Authority and the
Council, but I'm going to be arguing that we ought to take our
tax dollars on the local side, OK, complementing what ought to
be happening on the Federal side, take our precious local
dollars and apply them where they have the most impact.
And I think analysis will show you on the local side you're
going to have the most impact providing reduction for a small
business. That's 60 percent of your economy. You get the most
elasticity, in terms of response, you know, hiring new people,
expanding the tax base by their own organizational growth.
That's where I would like to see our dollars go.
And our staffs are working up models as part of the fiscal
year 2000 budget process that costs these things out and give
the Mayor, the Financial Authority, the Council, you know, the
ability to make some of these decisions. I certainly would hope
that in the year 2000 budget there will be that kind of focused
tax reduction.
Mr. Davis. We want to obviously work with you on that
issue. That's a legitimate concern up here as well.
Ms. Cropp.
Ms. Cropp. Yes, Mr. Chairman, as you may be aware, the
Council had commissioned a Tax Revision Commission. Have you
seen that report by any chance? We would like to make sure that
you get a copy. It's a very comprehensive report, that tax
revision.
Mr. Davis. My staff has seen it. I have not, but your
reference to it has kindled my interest.
Ms. Cropp. Good. If you need a copy, we will make sure you
get a copy of it. When the Council commissioned that, it was
with the idea that we needed to look at tax reform in the
District of Columbia. That is one of the very basic focuses
that we are going to do in the upcoming year.
I'm happy that the Mayor and the Financial Authority agree
with that. And we're all looking at tax revision, tax reform in
some way. There are different opinions as to the approach that
we should take, but we are all clear that we need to do it.
That homebuyers credit has just been absolutely wonderful, and
I think it has had a positive impact in the District. I think
the audit will show that there were sizable revenue that was
achieved from that.
We need to look at other initiatives such as that that will
help the District's economy grow as we deal with tax credit.
And as we look at the downturn of the economy, that probably
will occur, not only here but nationwide in the future. We need
to look at a tax policy that will help look at and address that
problem for the future.
Mr. Davis. Thank you. It helps the economy, and that did a
lot to stop the free-fall in residential real estate and the
like. You have a healthy economy in this city. A healthy
economy saves the Federal Government a lot of money in terms of
bailout costs. I agree with you. I know Mrs. Norton played a
role in making sure that was included.
Mayor Williams, in your agency briefings on January 4th,
you quote from one of my favorite 20th century philosophers,
Fats Domino, when he said a lot of fellows nowadays have a BA
and MD or a Ph.D.; unfortunately, they don't have a J-O-B. And
job training is critical. In my State of Virginia, we graduate
more psychology majors than we do computer science majors by a
ratio of about 4 to 1. Yet you have to have the work force
today or the jobs leave the region.
The whole region is working on this. It's great to see the
big four jurisdictions working on this and bringing the others
in. That's one of the things, along with strong support from
the business community, that prompted this initiative which
would allow D.C. students to pay in-state tuition at out-of-
state universities across the country, which you don't have
now.
Can you share a few more thoughts? We talked about it
briefly in your power points in terms of job training. Focusing
on UDC playing a role in job training areas, making sure that
city students and city young adults and people who need
retraining will get it, either through the private sector or
with the government acting as a catalyst or directly. I wonder
if you could talk about that a little bit.
Mayor Williams. A couple of things. You know, I believe
that there is a whole continuum of education from preschool
through postsecondary graduate school, and what we're looking
for is to develop public-private partnerships that support us
in that effort. I talked about the public-private partnerships
that we're seeking, along with partnerships with the faith
community to provide support for children outside of school and
preschool; and that will be a major initiative in our budget in
year 2000.
It will again be a partnership. It's not just government
alone, but all of us. We want to make a major effort on school-
to-work. European countries, for example, some other cities and
regions have done a better job at school-to-work than we have
in our city providing the internships, apprenticeships for
students, particularly who don't want to pursue a professional
career, you know, want to be a welder, a technician of some
sort or another, providing more opportunities for our students
in that fashion.
And I'm committed to pursuing the idea of a technology high
school over in Southeast. I think that we can do this in a
fiscally responsible way in partnership with the private
sector. We've got, again, this concentration of technology,
this concentration of technology in the region. I think this is
a real possibility for us.
As to higher education, I think, one, our students ought to
be given the same kind of opportunities to pursue quality,
affordable education as students anywhere in the country. And I
strongly support conception--I don't know the details, but I
strongly support conceptually the bill that you put forward
that would give our D.C. students greater higher education
opportunity.
This would complement, in my mind as opposed to detract
from the mission of UDC. I support a 4-year mission for UDC.
But, you know, I went to Yale as an undergraduate, you know,
big institution, big endowment. It has had to focus its
educational mission in light of current technology and current
realities. UDC with a 4-year mission will and must do the same.
It's part of developing a new strategic plan.
And I would--I would as Mayor argue to the Council and to
the Financial Authority that we establish a Commission on
Postsecondary Education and balance a focused 4-year mission
for the University of the District of Columbia along with our
need to provide remediation for our students who graduate from
high school. Our need to provide continuing education, our need
to provide vocational education, all of these things are in the
mix, as you know. They all have to be harmonized. But I don't
think the two are mutually exclusive at all.
Mr. Davis. Do you want to add anything to that?
Ms. Cropp. Let me just go--in addition to that, let me also
say that the District needs to truly focus on job training and
retraining within the local government. That's an extremely
important part of revitalizing the city as a whole.
Unfortunately, as most--well, as the District looked at
financial downturn, one of the first things that went was any
type of training program. You need that training program more
so than ever before, because you're changing the way you're
doing government, people are doing different jobs, a lot of
people left, new managers are moving up.
One of the things--one of the partnerships that I'm pleased
developed out of this crisis was with Fannie Mae and George
Washington University in having a training academy for our
midlevel managers; and that's something that is extremely
important, to train our work force how to be managers.
So--in addition to what we do in early childhood and high
school, secondary and higher education, which obviously is
extremely important, we must also look at job training for our
work force.
Mr. Davis. I just would add that I've been through Lorton
and talked to some of the inmates there and when they all come
out to return to the workforce they need educational
opportunities to succeed. We want them to have an equal chance
at life. Some of these kids did not have the educational
opportunities or they dropped out and didn't have constuctive
activities. It seems almost like a whole generation in this
city that didn't get the opportunities and even if they worked
and performed couldn't see that there was going to be anything
at the end of the tunnel for them.
If we can just give them a career path, where if you stick
to the rules, if you work hard, there's going to be some
reward. That's what this scholarship program we're talking
about is about. If you succeed, you're going to have the same
opportunities that the kids in Virginia and Maryland and every
other State have and that the breadth--not that UDC is bad or
can't be enhanced in many, many ways as a 4-year school, but
have the breadth of opportunities that State universities and
university systems across this country have.
If you can take just one kid out of Lorton and you make
them productive and job producers, these things pay for
themselves.
Mayor Williams.
Mayor Williams. If I can just say, one of the things that's
instructive and I think really good about this proposal is
that, you know, it complements what the business leadership and
the city and the region is doing to provide higher education
opportunity as well, and that's to me what ought to be endemic
in everything that we do that we're working in partnership.
Mr. Davis. Ms. Norton and I talked about this and you heard
support from Mrs. Morella, and you will hear it from suburban
leaders, suburban business leaders like Lou Noto, who really is
the brainchild of this plan. We all have a vested interest in
these kids succeeding, not going to Lorton but going up the
career ladder and being very productive members. This is just
one of a series of things I think we can accomplish to take the
city to the next step. I'm very hopeful.
Ms. Cropp. Mr. Chairman, I really feel as if I must add
this one part as we talk about education. You know, I'm a
former teacher in the public schools and a counselor of public
schools. I was on the board of education. And, actually, as I
reflected on how can you make things better, what could be
done, one of the concerns that I truly have as I looked and
thought about how children really learn, they learn through
their entire environment. That's how children learn. And if
they're in schools 6 hours out of the day, there are 18 other
hours that impact on who our children are and what they learn.
And as we look at the education of our young people, it has
to go beyond the classrooms, and that's why it's so important
with what the Mayor is saying with recreation and other things
such as that, because that is an important part of the
education of our young people. And it's 18 hours, and that will
overwhelm the 6 hours that they're in school any day.
And, you know, if it is structured activities like sports
or something like that, not that we think everyone would be a
Michael Jordan and multimillion dollar contract athlete, but it
teaches them certain basic skills such as discipline, how to
follow rules, how to play as part of a team. And then those
schools help to reinforce positive things for when they go into
school for the 6 hours.
So I felt compelled to say that as we look at strengthening
education of our young people, if you look at how children
learn, they learn through their entire environment, which means
that it has to be a comprehensive approach to make sure that
those 18 hours that the children aren't in school are a
positive learning environment for them.
Mr. Davis. I would like to respond. In the city, it's even
more acute. The District can be a real role model, because the
District has a much higher percentage of kids from single
parent homes--I came from a single parent home--or no parent
homes, in some cases, where just having other available options
after school besides going home. They need other options
available and having that career path available makes a huge
difference.
So we can work together on that. We want to complement what
you're doing up here on the Hill. We have yielded to you on a
lot of these issues in terms of what the glide path is.
Let me now recognize my colleague, Ms. Norton.
Ms. Norton. Thank you, Mr. Chairman.
I appreciate the answers and your questions on job
training, particularly in light of the economic development
that's going on in the city. I've really begun to think long
and hard about economic development, because what I think the
District has to face is those jobs are going to suburbanites,
and sometimes in extraordinary numbers.
If you talk to business people from downtown, they will
tell you 8 out of 10 of the folks that they hire are from some
part of the suburb, because that's the most readily available
pool of people that come through the door that seem fully
qualified. That's why, for example, in my tax package, one of
the most important sections is the section that's says if you
have a D.C. employee, not just hire one but have one, you get
$3,000 off the first $15,000 that you pay that employee. Unless
we're willing to come down with some incentives like that, our
own people are not the most readily available people and all of
this economic development is not going to do much for D.C.
residents.
You need the kind of training you're talking about, and you
need incentives for people to hire our folks as opposed to hire
everybody else, and that even goes for jobs in the hotel
industry.
I appreciate the chairman's humor, who says to me, Eleanor,
if we pay them more, they're likely to become Republicans. And
I do want to note for the record that the Republican majority
has been very ungenerous when it comes to the salaries of
Federal employees and managers. And I note the role reversal
here at this podium with the great generosity of the Republican
majority and the use of taxpayers' money, D.C. taxpayers'
money, to pay salaries that they would never abide comparably
for the Federal sector.
Mr. Davis. Would the gentlelady yield for a second?
Ms. Norton. I would certainly yield to the chairman.
Mr. Davis. I would just add that I know Mrs. Morella has
been very critical of this Democratic administration on the way
they have used FEPCA, Federal Employees Pay Comparability Act.
For each year under existing law, signed by President Bush,
Federal employees would be getting more money.
This is not a partisan issue, it is a philosophical issue
of how you get the best managers. I would join with you in
saying we don't want to overpay people if we don't have to.
Ms. Norton. My only point, Mr. Chairman--and I expect to
see you on the floor the next time that once again--because it
has happened now for more than a decade--Federal employees
don't get the statutory raise. I know you will be there since
so many of them are in your district.
Mr. Davis. I have always been there.
Ms. Norton. Now, let me also respond to the notion that we
have to pay this money to get the talent. Where is the talent?
That is my point, Mr. Mayor, that is my point to the empty
chair of Alice Rivlin, if you had to pay the money to get the
talent, why is it, Mr. Mayor, that you are having to be your
own city administrator, revise the plans that have come
forward; if, in fact, we had gotten the talent, this is one
person who would have taken her hat off to everybody.
I inherited, when I came to this city, the most messed-up
agency in town, the EEOC, with a huge backload. I know
something about what it takes to attract good people and what
it means to be limited in salaries. But I do not expect city
officials to sit before me and say you have to understand,
Eleanor, we needed this in order to find a talent, without
being able to point up to me where that talent is.
And I also want to say that this is an issue of no small
moment to District residents. When District residents raise
issues that they may not have all the information on, I will
come back and give the information. For example, with Camille
Barnett's contract, that there were other things here, like the
present Control Board is locked in with a bad decision of the
prior Control Board to give somebody a 5-year contract. Nobody
can tell me that in order to get a competent, a good manager,
you had to have a 5-year contract.
But I want you to know that I believe that the residents of
this city deserve hard bargaining for their high tax dollars,
and I do not believe that hard bargaining occurred when people
can write their own checks and severance pay. And I say this
also in this context, that the reason I think there is some
consternation in the city about it is that city employees all
through the crisis took it in the butt, it was they who had to
do furloughs with no money. It was they who got no increases.
So I think there is a burden. If you happen to live outside
the city, you may not see that burden. But there is a burden
for those who live here and have a responsibility here to make
sure that you can justify going way above, not just a little
above, but way above market rates. And if the answer is we
needed to get the talent, then I want a list of the names of
the talent that that money bought, because I, for one, don't
see it.
I also don't appreciate comments about bulletproof vests to
come to work in the District of Columbia. The only people who
need bulletproof vests are people who live where cabinet
members and managers do not live, and it is that kind of
stereotype that is unnecessary and that I will always protest
against.
Now, I have a question for the Mayor. Mr. Mayor, there is
also concern that for a couple of months, and you've said it
would be for a short period of time, you were going to be your
own city administrator. I have to confess I'm not as concerned.
I think it would be hard for you to find a city administrator
who knew the government and the finances of the government as
well as you do. I also trust your judgment. I think you've
shown you have the ability to plan and to focus, not to promise
what you can't deliver.
I heard you promise that you would resign if you didn't
have a clean audit. Far from just having a clean audit, you
helped work up a surplus. I'm really not concerned because of
your own track record. But I think it would ease the anxiety,
at least some have expressed, if you would offer some greater
detail about how you would manage the notion of being your own
mayor and your own administrator and, in particular, what kind
of assistance, from where, in what degree, do you think it will
hold you for the full couple of months, what will you be doing
in the meantime, what kind of search will you be doing for city
administrator, what kind of city administrator are you after?
Those are the kinds of questions I have for you.
Mayor Williams. Well, on Monday we hope to announce in
great detail exactly what this staffing arrangement will be,
what this assistance plan will be to give me the tools to
maintain direct accountability for the operational
administrative functions of the government, assistance from the
Federal Government in helping us with the crosscutting issues,
making sure they're coordinated, making sure we're looking for
ways to get around logjams as they develop in personnel or
procurement, assistance from the Federal Government, we hope,
in helping us with advice and consultation on moving forward,
very, very importantly, restructuring and providing for the
right staffing between the Mayor's office and an ongoing city
administrator's office and the right kind of span or control,
the right kind of contact between those offices in the
government.
Because one of the things that I'm trying to avoid now and
in the future is too much insulation between the Mayor and
these departments, because if you've got a lot--too much
insulation, by the time a problem gets up to the Mayor, it's
insolvable, you know, because for general--in a general
bureaucracy, people don't want to fess up to problems. They try
to manage them down at their level, and you've got that
problem.
The arrangement that I'm looking at over this 2-month
period involves, I think, an unprecedented coordination between
my office and the Financial Authority as well, because I think
we all have to look at the fact that they're going to be
providing management assistance. They can on a very operational
basis provide us management assistance in both, providing for
continuity in the long-term improvement in the government while
focusing on a change effort.
So, specifically, we will have a staff person whose job it
will be--reporting to me, a staff person whose job it will be
to monitor and make sure we can continue the long-term
improvement agenda we already have underway that I support,
make sure that on a defensive basis, you know, planes aren't
crashing, things aren't coming into conflict, that the agency
day-to-day concerns are getting taken care of. We will have a
staff person with assistants focusing on these action plans
that I talked about. We will have these other private sector
Federal people, providing me assistance, all of us working in
executive committee, all of them giving me the tools I believe
to do this job over the next month, 2-month period to get these
changes.
As for searching for the city administrator, I think we
ought to bargain with top officials the same way we bargain
with our employees, and we ought to be moving always toward
competitive wages based upon the right kind of indicators. Who
could argue with that. We are modifying the search committee
that we already have in place for a CFO to take a list of
candidates as they come forward for the city administrator, and
I'm confident that for a lot of different reasons we're going
to have a very good list of strong candidates for that position
in 2 months that we can bring forward to the Council and
Financial Authority for their consultation, recognizing that,
depending on how this works out, this is a mayor's decision.
One issue is are we talking about a chief management
official or a city administrator. In my mind we're working
generally with the Authority. In my mind it doesn't really
matter as long as they're doing the operational part of the
government. What we call them, I don't want to get all bogged
down in him or her.
Mr. Davis. Why don't you finish your questions? We will try
to wrap this up. I know the Mayor needs to get over to the
Senate side.
Ms. Norton. My questions are aimed at giving you the
opportunity to elaborate or explain issues that I know are
troubling people, and you're not finding me give you softballs.
Let me give you another one. It has to do with managed
competition, which can be a very exciting idea and we know has
been used in other cities. Philadelphia, a comparable city has
used it. Could you give us some idea of how you would implement
managed competition and how you would involve city unions and
city employees in the implementation of managed competition for
people who, for example, have never had to bid before, don't
know anything about and have had no reason to know anything
about requests for proposals? How are they going to be on a
level playing field with folks out in the private sector who do
that kind of thing every day to earn a living?
Mayor Williams. Right. I think that as part of our overall
staffing assessment we're always looking to distinguish
between, to be blunt about it, employees who really have a bad
attitude. You can be a rocket scientist, and if you've got a
bad attitude there's nothing you can ever do about that. And
everything that I've talked about for years about
accountability has always focused on that employee, not who
doesn't necessarily know what he or she is doing, you can work
on that. It's that employee who has a bad attitude, right,
you've got to address that. Once you've addressed that, you're
talking about a group of hard working employees who ought to
have the same ability to succeed as anyone else. And I believe
it is incumbent on us to work with labor, work with our
employees to first of all fashion the criteria we're going to
use for this competition.
I will give you some of the factors that you have to look
at. Do you have adequate cost information? If you don't have
adequate cost information you don't really know what you're
choosing in terms--it's like going to a supermarket and no
price tags, you need good cost information.
Ms. Norton. Market information that doesn't have you
overpaying people who do the work?
Mayor Williams. Absolutely, absolutely; one. And, second,
an issue that we want them involved in, another criteria is are
there private vendors who can do the job? We've had instances
in our city, and you've seen it in other cities, where you've
had private vendors that were doing the job, they weren't able
to do the job, that's a problem.
Another problem is staging or bundling, if you will. Many
of the cities that have pursued this have not pursued
outsourcing for the entire city or the entire jurisdiction.
What you may do is, you may do one part labor, you may do one
part one vendor, one part another vendor. So you have some
backup and you really give the employees some opportunity on
what they can do.
And finally before you even begin this process, you've got
to provide employees with the assistance, the legal assistance,
the technical assistance, the tools in terms of these training
kits that I talked about for individual employees, so when they
bid to do a job it's a realistic bid and you're not just going
through a shell game with them, and that I'm committed to do.
What I'm trying to do is provide better service at lower costs
for our citizens. What I'm not trying to do is just simply
drive down wages of good workers simply for the sake of driving
down wages. That is not my goal, nor should it be my goal.
Ms. Norton. One final question, this is really for Ms.
Cropp, as well as you, Mr. Mayor, and it's inspired by what the
chair said about the charter. I was so pleased to hear you say
that the city was going to initiate a look at its own charter,
that is not the work and should not be the work of the
Congress. And I congratulate you on that initiative.
Let me just say that the Mayor said something in his
testimony that is not unrelated to what you said and that is
when the Control Board sunsets, he would be concerned that
there be an independent CFO, and how to work that into the
present government is obviously a problem to consider. The
concern expressed to you about opening up the charter is
understandable.
It is true that there are members who might be inclined to
jump in with both feet, and so it's very important if we open
it up, to open it up for the right positions and very
responsibly. That's why I focus in on this CFO notion, and I
ask this question without having any opinion because I really
don't know. I spent the earlier part of my career in New York
and noted that the way in which there was real independence in
the budget process; it was a comptroller who was elected and
who had, therefore, a built-in adversarial relationship to the
Mayor. And the one elected official that the Congress might
readily add to the charter might be something like an elected
comptroller. As you're faced with who appoints this CFO, how do
you make him truly independent without writing a lot of
legislation to insulate him? How do you make him truly
independent from the Mayor, even if he is confirmed by the
Council?
I wondered if you've thought about whether that position
can be insulated in some way as it is when power goes back to
the Mayor, whether it should be an elected position, or whether
there might be other solutions to that problem of fiscal
independence?
Ms. Cropp. Ms. Norton, as you indicated you have not
reached an opinion, quite frankly, neither have I. I think you
have raised a very serious issue that we must look at. Those
are the decisions that we must come to. Whether or not it's an
elected position, whether or not an appointed position that
cannot be removed except for cause, I'm not certain. But that
was one of the areas that I think we need to look at as we look
at the charter. And, hopefully, as we go about discussing it,
we will evaluate which method may be the best method, if in
fact that's the direction we want to go.
Mayor Williams. I would just say as a former financial
official, in looking at the District, the problem, I don't
think an elected comptroller is necessarily the answer. When
New York City went insolvent they had an elected comptroller. I
think Philadelphia has an elected comptroller, if I'm not
mistaken, they may not. Some cities have had elected
comptrollers and they still had these problems.
I think really what we ought to try to do is, through this
process, and I support the general idea of citizen involvement
in a charter reform as we move back to self-government, that we
look at giving independence by statute to this officer and
financial reporting. This is also in the Control Act. So even
when the CFO turns into a pumpkin after the end of the control
period and the powers are diminished that person will still
have responsibility for accurate financial reporting. To me
that's very, very important.
We have to make sure that this person has responsibility
for internal control and integrity, in terms of systems
development. I think that's very, very important. And finally,
I think personally, and I'm Mayor now, I still think it's very,
very important that this person have responsibility, some
autonomy, I will put it that way, in setting the revenue
estimate for the District, because that's the ballgame.
If you have some independent objective party setting up
that revenue investment, it removes from us a temptation to
stop playing games. If you look at the history of all of these
debacles, a lot of it goes to overestimating revenues,
underestimating expenditures.
Mr. Davis. Thank you very much.
I will now recognize Mrs. Morella.
Mrs. Morella. My question to you, Mr. Mayor, and if
Councilwoman Cropp wants to respond, too, is that the D.C.
appropriations bill for fiscal year 1999 limits attorneys fees
for representation of special needs kids.
I have learned that this provision has been applied
retroactively and yet that wasn't the intent of Congress. I
wondered if you would respond to that. Congress never intended
to have it be extended retroactively, and I am just very
concerned about that interpretation of it. And I'm hoping that
you will be able to remedy that, and what your comments are on
it?
Ms. Cropp. I was not aware of the retroactivity aspect of
it. I would need to look into that.
Mr. Davis. If you could look at that and get back to us.
Mrs. Morella. I would be glad to get a letter off to you
about that.
Mr. Davis. That's fine.
Mrs. Morella. Mr. Mayor, are you familiar with this?
Mayor Williams. I would echo what Chairman Cropp has
stated. I am not familiar with the fact we had gone retroactive
with it and would be happy to get more information to you.
Mrs. Morella. It requires a clarification coming from you;
both of you would be great. Thank you.
[The information referred to follows:]
[GRAPHIC] [TIFF OMITTED]65954.058
[GRAPHIC] [TIFF OMITTED]65954.059
[GRAPHIC] [TIFF OMITTED]65954.060
[GRAPHIC] [TIFF OMITTED]65954.061
Mr. Davis. Thank you very much, Mrs. Morella.
And without objection, all written statements submitted by
witnesses will be made a part of the permanent record, and the
record will remain open for 10 days.
The subcommittee will continue to work with all interested
parties to achieve our objectives, and these proceedings are
closed.
[Whereupon, at 1:35 p.m., the committee was adjourned.]
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