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B 26-0659

Fiscal Year 2027 Local Budget Act of 2026

26th Council Period (2025-2026) Introduced by Phil Mendelson

The bill enacts DC’s FY2027 local budget, aligning spending to projected revenues while funding core city services like education, safety, health, housing, and infrastructure.

Final Reading
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WeVote Research Nonpartisan
Bill Summary · B 26-0659

Summary: Fiscal Year 2027 Local Budget Act of 2026 (Bill B 26-0659)

Sections below present a clear, nonpartisan overview of the bill’s purpose, principal provisions, affected parties, and notable timelines.

1) Purpose and Intent

  • The bill adopts the District of Columbia government’s local portion of its Fiscal Year 2027 budget, as proposed in the Grow DC plan.
  • It aims to align spending with economic realities (e.g., slower revenue growth due to telework-era office park dynamics and federal job losses) while continuing to support education, public safety, health, housing, infrastructure, and other core city services.
  • The legislation is framed as implementing a sustainable, growth-oriented budget to maintain DC’s public services, investments, and resilience.

2) Key Provisions and Changes

  • Overall Budget Adoption

    • Enacts the local portion of DC’s FY2027 budget (ending September 30, 2027) under the Home Rule Act framework.
    • Establishes appropriations across all major government functions with detailed fund sources (local funds, dedicated taxes, federal grants, Medicaid, other funds, private funds, etc.).

  • Funding and Revenue Assumptions

    • Total operating expenses for FY2027 capped to the lesser of total anticipated DC revenues or $21,224,482,951, with a detailed breakdown by fund source (local funds, dedicated taxes, federal grants, Medicaid, etc.).
    • Provisions allow adjustments for federal funding appropriated by Congress and for one-time emergency or unanticipated needs, subject to local law and reserve requirements.

  • Reprogramming and Transfers

    • Local funds can be transferred between operating, enterprise, and capital funds; reprogramming is permitted (subject to constraints), but bonds/obligations-derived funds cannot be reprogrammed for operating expenses.
    • Funds may be reprogrammed through November 15, 2027; long-standing reserve and contingency rules remain in effect.

  • Operational Flexibilities and Allowances

    • Authority to pay specific termination costs associated with multiyear contracts, including energy projects and microgrids, drawn from designated funds and subject to restrictions (notably excluding emergency cash reserves).
    • Allowances for continuing nonlapsing funds and end-of-year unspent balances to carry over for the following year, with reporting and coordination by the Chief Financial Officer (CFO).

  • Agency and Program-Specific Allocations

    • Substantial appropriations across major DC agencies, including:
    • Government direction and support (e.g., Board of Elections, Ethics and Government Accountability, DGS, CFO, CTO, COG, MCGB, etc.).
    • Economic development and regulation (e.g., Arts and Humanities, Department of Housing and Community Development, Small and Local Business Development, Housing Authority, Office of Planning, Deputy Mayor for Planning and Economic Development, Tenant Advocate, Zoning, and more).
    • Public safety and justice (e.g., MPD, Fire and EMS, Corrections, Courts-related agencies, Homeland Security, District of Columbia National Guard, Victim Services, etc.).
    • Public education systems (e.g., DCPS, OSSE, Charter Schools, Public Charter School Board, Public Library, University of the District of Columbia subsidies, Special Education Transportation, etc.).
    • Human services and health (e.g., Child and Family Services, Department of Health and Human Services, Behavioral Health, Health Care Finance, DHS, AIDS/HIV-related funds, etc.).
    • Operations and infrastructure (e.g., Departments of Buildings, Energy and Environment, Transportation, Motor Vehicles, Public Works, Parks and Recreation, Licensing and Consumer Protection, etc.).
    • Specific programmatic funding details include:
    • Notable caps such as operating expenses not exceeding the specified total revenue.
    • Funding for ongoing and capital city projects, including WMATA-related financing, RFK campus development, and energy/renewable initiatives.
    • Authorization for funds to support DC-based public charter schools with quarterly disbursements and several performance-linked provisions.

  • Enterprise Funds and Capital Programs

    • Enterprise funds receive $2.33 billion in combined funding, with allocations to:
    • DC Water and Sewer Authority capital programs (water, sewer, and related infrastructure).
    • DC Health-related funds and retiree health contributions.
    • Ballpark and retirement board activities.
    • Other major capital projects and debt service considerations.
    • Pay-As-You-Go (PAYGO) capital funding is included to supplement capital investments rather than relying solely on new debt.

  • Federal and State-Affiliates Adjustments

    • Budget amounts explicitly reflect adjustments based on anticipated federal funding and federal payments, including:
    • Federal payments to education, juvenile justice, public safety, health, and other sectors.
    • Appropriations anticipated to be provided by Congress under the FY2027 Federal Portion Budget Request Act (2026).

  • Special Funds and Duration

    • Several funds are designated as non-lapsing or multi-year, with expenditures authorized through September 30, 2027 (or longer, where specified).
    • Several programs include ongoing authority for grant awards or operating expenditures through 2030 or beyond, particularly in Arts and Humanities, Housing, and Public Charter Schools funding, subject to grant awards and program rules.

3) Affected Parties and Impacts

  • DC Residents and Public Sector Employees

    • Direct impact on public services, school funding, safety services, health programs, housing initiatives, transportation, and utility infrastructure.
    • Employee allowances, food, lodging, and per diem provisions for emergency deployments and travel related to District programs.
    • Potential changes in pension, retirement, and benefits administration through the DC Retirement Board, Police Officers’ and Firefighters’ Retirement System, and related funds.

  • Public Charter Schools and Charter Sector

    • Funds allocated to the DC Public Charter Schools and the DC Charter School Board with structured disbursements and conditions on future funding in FY2028.

  • Businesses and Economic Development

    • Substantial investment through the Vitality Fund, Tech Ecosystem Fund, Downtown and citywide development programs, and support for small and local businesses via the Department of Small and Local Business Development.

  • Public Safety Agencies

    • Budget supports operations for MPD, Fire and EMS, corrections, Homeland Security, National Guard, and related justice agencies.

4) Timelines and Procedural Aspects

  • Fiscal Year Coverage
    • Budget covers the District government’s FY2027 (October 1, 2026 – September 30, 2027).
  • Federal Coordination
    • Adjustments to local appropriations based on anticipated federal appropriations; local and federal funds may be revised to reflect actual Congressional allocations.
  • One-Time and Carryover Provisions
    • Permits one-time increases to address emergency or unanticipated needs, subject to local law and reserve requirements.
    • Nonlapsing and fund-specific carryover provisions extend authorization for expenditures through specified dates (often September 30, 2027 or later).

Note: The bill text includes complex, granular allocations across dozens of agencies and funds. The above summary highlights the core structure, major funding themes, and notable fiscal mechanisms intended to implement the FY2027 Local Budget Act of 2026. For precise line-item figures by agency and fund, refer to the appropriation schedule within the bill.

Compiled from official sources — confirm details with the bill’s official record.

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