After House Republicans included a provision defunding Obamacare in their fiscal year 2014 short-term continuing resolution (CR) to keep the federal and District of Columbia governments running after September 30, 2013, Congresswoman Eleanor Holmes Norton (D-DC) today took several steps to keep the District government open. Norton alerted D.C. Mayor Vincent Gray that, due to the addition of Obamacare defunding, the chances that Congress will pass a CR to keep both the D.C. and federal governments open are significantly reduced. Today, Norton also sent letters to House Speaker John Boehner (R-OH) and Senate Majority Leader Harry Reid (D-NV) urging them to bring a bill to the floor that will keep the District of Columbia government open in the event of a shutdown on September 30, 2013. Norton is requesting language similar to the legislation she worked on with former Speaker of the House Newt Gingrich that allowed D.C.'s government to remain open during the winter 1995-1996 federal government shutdown.
"Speaker Boehner and Leader Reid can and should bring a bill to the floor to keep the D.C. government open, as Speaker Gingrich did," said Norton. "The District government is irrelevant to the Obamacare defunding or any other federal issues in the CR. The city did its job when it passed a balanced budget and submitted it to Congress on time, and should not be penalized because Congress has failed to do its job. Ironically, we have bipartisan support for preventing D.C. government shutdowns in pending bills. The city is an innocent bystander in this federal fight, but a local D.C. shutdown will amount to a great deal more than collateral damage."
Congress has yet to pass its fiscal year 2014 appropriations bill that approves D.C.'s local budget. If the federal government shuts down on September 30, the D.C. government would shut down as well, because D.C. cannot spend its own local funds without congressional approval. Norton's pending District of Columbia Government Shutdown Avoidance Act of 2013 would permanently prevent D.C. government shutdowns by authorizing the District government to spend its local funds in the event of a federal shutdown, just as every other jurisdiction in the country is permitted to do. Norton also offered an amendment, on which she testified yesterday at the Rules Committee markup of the CR, to authorize the District government to spend its local funds for all of fiscal year 2014, and not just until the expiration of the CR (December 15, 2013), so that the city does not face a shutdown threat again when the CR expires in December. The amendment was rejected by the Rules Committee last night.
In July, both the Republican-led Oversight and Government Reform Committee and the Democratic-led Senate Appropriations Committee approved larger bills that contained a provision that would permanently authorize the D.C. government to spend its local funds during a federal government shutdown. The President's fiscal year 2013 budget also contained a permanent shutdown-avoidance provision. The report accompanying the Republican-led House Appropriations Committee-passed fiscal year 2013 Financial Services and General Government Appropriations bill also acknowledged the harm of District government shutdowns and called on the authorizers to consider legislation to prevent shutdowns. Additionally, no action has been taken in Congress to interfere with the budget autonomy referendum approved by D.C.
Norton's letter follows.
September 19, 2013
Dear Speaker Boehner and Majority Leader Reid:
As the House, Senate and administration continue to struggle to pass legislation to keep the federal government open after September 30, 2013, over matters entirely unrelated to the District of Columbia, I urge you to pass legislation that would allow the D.C. government to spend its local funds, subject to the terms and conditions of the fiscal year 2013 continuing resolution, in the event of a federal government shutdown and therefore remain open. After recognizing the disaster caused by shutting down the D.C. government during the first federal government shutdown in 1995, Congress, under the leadership of Speaker Newt Gingrich, passed legislation (P.L. 104-90) during the second federal government shutdown in 1995-1996 to permit the D.C. government to spend its local funds and remain open.
With less than two weeks before a shutdown, the D.C. government must begin contingency shutdown planning. When the District government faces a shutdown threat, it has to divert high-level staff resources and funds to contingency planning. In 2011, when the District faced several shutdown threats, it devoted approximately 3,000 total staff hours and $131,250 to contingency planning. These costs, however, pale in comparison to the catastrophic costs that would be imposed by an actual shutdown.
If the District government shuts down, basic municipal services, such as garbage collection, would cease. Not only do the more than 600,000 D.C. residents rely on these services, but so do private sector businesses, commuters, visitors, federal officials, federal buildings and foreign embassies. In addition, the District government could default under certain financing agreements, further impacting city services and sending the city's borrowing costs soaring. For example, the city has a Master Equipment Lease, under which it leases a wide range of equipment, including traffic lights, automobiles, public safety vehicles, and computer hardware and software. If the city does not have budget authority when the payments are due, the city could not make the payment and the equipment would be subject to repossession for non-payment. The city also has Certificates of Participation outstanding for certain District government buildings, including the Unified Communications Center, the District's public safety and emergency preparedness communications and command center. If the city does not have budget authority when the payments are due, the city could not make the payments. Upon default for a missed payment, the trustee may take possession of the facility and relet it. These negative consequences are compounded by the fact that defaults under either the Master Equipment Lease or the Certificates of Participation would be considered material and would have to be disclosed to the District government's bondholders. While the District government's bonds are not subject to appropriations, such defaults would raise questions about the D.C. government's ability to repay its debts, driving up its future borrowing costs. The District government has worked too long and hard, including accumulating $1.5 billion in reserves, one of the highest amounts in the country, since its financial crisis in the mid-1990s to develop an outstanding reputation on Wall Street to see it erased over a shutdown.
I do not believe any Member wants to shut down the D.C. government and bring a large, complicated city to its knees because of a purely federal matter. Indeed, there is bicameral, bipartisan support for preventing D.C. government shutdowns. In July, both the Republican-led Oversight and Government Reform Committee and the Democratic-led Senate Appropriations Committee approved larger bills that contained a provision that would permanently authorize the D.C. government to spend its local funds during a federal government shutdown. The President's fiscal year 2013 budget also contained a permanent shutdown-avoidance provision. The report accompanying the Republican-led House Appropriations Committee-passed fiscal year 2013 Financial Services and General Government Appropriations bill also acknowledged the harm of District government shutdowns and called on the authorizers to consider legislation to prevent future shutdowns.
Thank you for your consideration.
Eleanor Holmes Norton