The District of Columbia's financial control board wants to work itself out of a job, chairman Alice M. Rivlin said yesterday.
Rivlin, who is also vice chairman of the Federal Reserve Board, told the Government Finance Officers Association of the Metropolitan Washington Area that the control board was not designed to be the district's government.
"It is a preposterous idea that five unpaid people with no previous experience in urban government would continue to run a city," said Rivlin, who was the director of the federal Office of Management and Budget when the control board was created in 1995. "We will work with the new elected officials to figure out how we return home rule to the district and how we shift power from an anomalous board to the elected officials and get back to normal government.
"With any luck and with the cooperation of Congress, we will be able to do that in a couple of years," Rivlin said.
The federal law that created the control board requires the district to balance its budget for four consecutive years before local control can return. The district balanced its budget in fiscal 1997 and is awaiting an audit of fiscal 1998, which ended on Sept. 30.
The district budget Congress is expected to approve as part of the fiscal 1999 omnibus appropriations package also projects a balanced budget for the current fiscal year.
The omnibus bill also includes $25 million in federal funds for the initial capitalization of an economic development corporation for the district.
Economic development will be key to the district's future ability to achieve balanced budgets, and regional cooperation is necessary for that to occur, Rivlin said.
Referring to a recent report by Brookings Institution fellow Carol O'Cleireacain on the fragility of the district's fiscal recovery, Rivlin said maintaining budget balance will not be easy and that revenue growth through economic development "is (the control board's) most important priority, because without it nothing else happens."
Rivlin stressed the need for region-wide efforts, noting that "the stake of the suburbs in the vitality of the core city is more true in the Washington area than in other places. Our city revolves around being the national capital."
With a new mayor and new district council being elected next month, "this is a moment when everyone can coalesce around a plan, the district, the federal government, and the region," Rivlin said, acknowledging that there have been numerous economic development plans for the district and the region over the years.
In particular, she said regional transportation back-ups must be addressed, perhaps through creation of a regional transportation authority with taxing power that could finance transportation projects to alleviate congestion. She first recommended such an authority - separate from the existing Washington Metropolitan Area Transit Authority, which runs the regional bus and subway system - in 1990 as part of the report issued by the Commission on Budget and Financial Priorities of the District of Columbia, of which she was the chairman.
"If we don't get a transportation system that enables traffic to flow more easily, we are going to choke," said Rivlin.
She suggested that the district's financial control board could help foster such cooperation "and then get out of the way."
Rivlin also praised the district and neighboring Prince George's County, Md., for jointly applying for designation as a federal empowerment zone, a move that would qualify the area for certain federal benefits, including access to tax-exempt borrowing for economic development projects.
She urged continued regional cooperation, noting that in higher education in particular, the region is not "using our resources very well."
Instead of competing for students, Rivlin suggested that colleges and universities coordinate program offerings.
