Annual Message to the Congress on the District of Columbia Budget.

To the Congress of the United States:

I present the budget for the District of Columbia for the fiscal year beginning July 1, 1967.

Notwithstanding increased attention to the District of Columbia by the Federal Government in recent years, there is persuasive evidence that much remains to be done if the Nation's Capital is to be a capital in which all Americans can take pride. Problems of housing, education, employment, crime and a rapidly changing racial balance-the problems of most large American cities--are critical. Now, not later, is the time to attack them.

American citizens have a right to express themselves at the polls about the people to run their governments. The citizens of the District must be given a voice in their own government through home rule. I believe that the last Congress should have granted home rule to the citizens of the District, and I urge the present Congress to give them home rule.

Two recent reports underscore the urgency of the District's needs. A 4-year study completed in August 1966 under a grant from the Department of Housing and Urban Development found a gradual worsening of the physical, social and economic conditions of the District. The report concluded that to do no more than just "hold the line" will require $175 million in additional funds over the next 8 years. To make "substantial inroads" on present conditions will require $750 million over that same period, and a course of "total action toward solving the problems" would require additional expenditures of $3 billion between now and 1975. This is a measure of the magnitude of what we are facing and of the inadequacy of our past efforts.

The other report, completed last month, is that of the President's Commission on Crime in the District of Columbia. The Commission recommends many changes in the agencies and programs directly concerned with crime, some of which are reflected in this budget. The Commission also expressed its concern at inadequacies in other District programs--'m employment, housing, education, health, welfare and recreation. Significantly, it adds that if these deficiencies in community life "are allowed to continue or to worsen, it will be difficult to formulate solutions to our crime problems, no matter what action is taken in the police, court or correctional fields."

I shall shortly transmit to the Congress proposals to enable the District to come to grips with its needs. It must move forward, not stand still or fall back.

The budget which I am presenting reflects the needs of the present. However, the District must prepare for greater efforts in the years ahead and it must consider sources of new revenue. To do so successfully, it must have the best advice and assistance possible. I will therefore include in a 1967 supplemental budget for the District, which I will shortly transmit to the Congress, $200 thousand for an independent study of the entire range of District revenue sources, actual and potential, to determine what changes should be made in its fiscal policies and tax structure. I would expect the study to be completed in time for consideration with the District's budget for fiscal 1969.

The Federal Government, of course, must meet its own responsibilities to the District. It is our Capital City. The Federal Government depends for its own proper functioning on a healthy and stable District. Moreover, the District, as the heart of a rapidly expanding, prosperous metropolitan area, direcry affects the character and livability of the entire region. Self-interest as well as proper pride in our Capital dictates that the Federal contribution to the city's revenues be completely adequate.

In my judgment, the Federal contribution is not yet at that level. Large but essential increases in District expenses have not been adequately matched by increases in the Federal payment. For that reason, I am again recommending to the Congress that the basis for determining the authorized Federal payment to the District be established as a percentage of basic local tax revenues.

This basis is not only more equitable for the present, but also will maintain an equitable balance into the future as changes occur in the tax burden of the District taxpayers. Revenues will be more predictable and forward planning of District programs will be more meaningful. In fiscal 1968, based on the current estimate of the specified tax revenues of $282.3 million, this basis would fix the authorization at $70.6 million--$10.6 million above the present authorization of $60 million. In fiscal 1967, this basis would have fixed the authorization at $64 million. The change in a period of only 1 year illustrates the need for a basis which will continue to reflect a fair apportionment of the costs of general District government between District taxpayers and the Federal Government.

Another aspect of District finances is also vitally in need of revision. The District is now compelled to borrow for its capital expenditures from the Treasury. The total of such borrowings for the general fund-which of course must in each instance be approved in the appropriation bills--cannot now exceed the fixed amount of $290 million. Repayments by the District are not taken into account; once the authorized amount has been borrowed the District's authority is exhausted, even though its outstanding obligations may be less than the $290 million authorized.

This type of authorization is both unnecessary and unfair. The District should not, of course, borrow beyond its needs, which the Congress evaluates in appropriation bills. Neither should it borrow beyond its capacity to repay; but that capacity, rather than an arbitrary dollar limit, should be the measure of its maximum permitted debt. I will, therefore, also propose legislation which will create a District debt ceiling related to the annual amount of general fund revenue, including the authorized Federal payment and using the same general fund tax revenue base proposed for the Federal payment authorization. A fair limitation--6%--of such revenues for debt service would permit a debt ceiling of $335 million in fiscal 1968. This is $45 million above the present authorization, and will, of course, permit the District to take advantage in the future of any portion of its present obligation which it has repaid.

These changes in the Federal payment authorization and in the District's borrowing authority are needed now. The Commissioners, on their part, intend to increase the real and personal property tax rates by 20 cents per $100 of assessed valuation, to produce an estimated additional revenue of $8 million. The District is also continuously seeking to reduce costs and improve management. For example, its cost reduction program has--

• Saved $500 thousand in simplification of paperwork.

• Saved $57 thousand annually and some 50,000 police man-hours, by use of special school crossing guards.

• Saved $250 thousand during the past 2 years by disposal of obsolete records to release prime office space.

• Saved $97 thousand annually in clerical time by simplifying police field reports.

• Reduced inventories by $100 thousand by using computers for improving inventory management.

Efforts to eliminate unnecessary and improve management, and the added financial resources proposed, will permit an. expenditure budget for fiscal 1968 which is appropriate to the District's requirements, both for operating expenses and up on a major backlog of sorely needed ital projects. A table summarizing the trict's budget and a description of significant budget proposals follow:

AUTHORIZATION AND FINANCING
[In thousands of dollars]

1966 1967 1968 actual estimate estimate Education: Operating expenses 75,641 86,529 101,028 Capital outlay 17,569 27,213 63,270 Welfare and health: Operating expenses 80,958 90,945 106,809 Capital outlay 6,014 2,572 5,889 Highways and traffic: Operating expenses 14,203 15,350 16,307 Capital outlay 9,852 15,455 18,501 public safety: Operating expenses 9,957 91,591 92,295 Capital outlay 1, 687 1,630 3,773 parks and recreation: Operating expenses 11,052 13,360 17,619 Capital outlay 1, 035 1,253 4,105 General operating expenses: Operating expenses 20,536 23,507 27,570 Capital outlay 2,110 898 13,705 Sanitary engineering: Operating expenses 23, 257 24,708 26,625 Capital outlay 12,547 12,747 17,516 Repayment of loans and interest 5,690 6,007 7,790 payment of D.C. share of Federal capital outlays 987 1,350 1,247 Contribution to rail rapid transit system 2,000 4,527 Judgments, refunds, and other expenses 3, 983 980 1,851 Total new obligational authority 369,078 420,692 525,900 Distribution of new obligational authority: General fund (325,984) (367,207) (464,687) Highway, water and sewage works funds (43,094) (53,485) (61,213) Proposed for later transmittal: Police pay increase--proposed legislation 220 1,327 Plans for new D.C. colleges--existing legislation 500 Reserves for indefinite appropriations 39 1,040 940 Funds required in subsequent years to pay obligations for capital projects (net) -1,750 -2,851 -16,964 Total financial requirements 367,367 419,101 511,703 Revenues and balances: Taxes, fees, etc.1 193,802 321,562 353,046 Federal payment: Existing legislation 44,250 60,000 60,000 Proposed legislation 10,600 Loans for capital outlay: Existing legislation 28,312 37,527 49,600 Proposed legislation 34,200 Funds released to surplus 2, 841 3,618 4,720 Beginning and end of year balances (net) 2 -1,838 -3,606 -463 Total revenues and balances 367,367 419,101 511,703

¹ Includes increases in real estate taxes from $2.70 to $2.90 per $100 assessed valuation and in personal property taxes from $2.00 to $2.20 per $100 of assessed valuation in fiscal year 1968.

² Balances are in the highway, water and sewage funds. No general fund balance estimated in 1967 or 1968.

EDUCATION

Operating funds for the public school system in 1968 require $101 million, an increase of $14.5 million over 1967.

The urgent need further to improve District schools has been emphasized not only in a recent congressional investigation and report, but also in the report of the Commission on Crime in the District of Columbia. The deficiencies are substantial, and they are serious. Education for every child to the limits of his capacity is basic to all other efforts. To achieve this goal in the District, the quality of education must be improved, the needs of children from deprived and inadequate family backgrounds must be given more attention, and the physical plant must be expanded and modernized. The budget reflects the urgent need to accomplish each of these objectives as quickly as possible.

IMPROVING THE QUALITY OF EDUCATION

With the funds provided in the budget the quality of education will be improved by-

• More support, through additional teachers, for elementary school instruction in such fields as science, mathematics, music, art, physical education, and foreign languages.

• Added professional help for schools of all levels in such areas as reading, speech, curriculum, library science, guidance, history and business education.

• An internship program to assist teachers in their first year of teaching through in-service training.

• Attaining Board of Education standards for librarians and counselors: a librarian for each school where facilities are available, and a ratio of counselors to pupils of I: 750 in elementary schools and 1: 400 in the secondary schools.

• Beginning a reduction in class sizes in schools where space is available. Regular academic pupil-teacher ratios in junior and senior high schools will be reduced from 25: 1 to 21: 1 Because of space limitations, the goal of a ratio of 24: 1 in elementary schools must await the construction program.

• Additional assistant principals in elementary schools to improve school administration and instructional super, vision.

MEETING THE NEEDS OF THE DISADVANTAGED

The funds provided in the budget will also help to meet the needs of children whose background and family resources are inadequate. Nearly half the pupils in the District's schools come from areas where the average family income is under $5,000. Funds from Federal programs have helped to enrich the school experience of these children, but more is necessary. The budget will-

• Provide teachers who can give individualized instruction to pupils who can be helped by more teacher attention provided through team teaching, ungraded classrooms, smaller class arrangements, seminars, and tutorial assistance in afterschool study.

• Initiate a pre-kindergarten program for 3,000 children, to convert the Head Start approach into a full-year program.

• provide help to approximately 60,000 students in remedial reading.

• Double the present number of pupil personnel teams to provide help both to pupils and to teaching personnel in determining the abilities and emotional stability of children

• Expand the school lunch program.

• Provide matching funds to qualify for teachers from the National Teacher Corps.

CONSTRUCTING AND EQUIPPING SCHOOLS

Funds in the amount of $63.3 million are provided in the budget for various phases of school construction. This is a substantial increase over past levels, but it is a more current assessment of the need. There is no economy in delay. On the contrary, postponement of essential facilities condemns many students to educational handicaps that will endure throughout their lives. The budget is intended to reflect urgency.

It will provide funds for-

• Construction of 17 projects for which site and planning funds have already been appropriated including 2 new elementary schools, 2 elementary school replacements, additions to 12 other schools, and an addition to the school warehouse.

• Equipment for elementary and junior high construction projects already funded.

• Planning and construction funds for three elementary and one senior high school additions.

• Site and planning funds for 28 school projects.

Seventy-five portable pre-kindergarten classrooms for the most seriously deprived areas of the District.

• An addition to Sharpe Health School, and a new school for the severely mentally retarded.

Funds are provided for the construction of a new Shaw Junior High School, for which the Congress provided special legislation in 1966. Funds to enable the Board of Vocational Education and the Board of Higher Education to begin planning for the two new institutions authorized by Public Law 89-791 can be supplied from existing resources in 1967. Provision is made in the budget for financing the two Boards in 1968.

CRIME

The budget reflects my continuing concern that people who live, work and visit in the Nation's Capital must be safe in their persons and their property. The continuing increase in the District's rate of crime demonstrates that our efforts thus far have not been adequate. The President's Commission on Crime in the District of Columbia has now given us a measure of our needs and of the steps to be taken. Its recommendations are being carefully evaluated, and a great many of them are reflected in the budget. I will shortly be proposing legislation to carry out other recommendations which require legislative approval.

The attack on crime must be on a broad front. The Police Department must be provided with adequate resources. No less must be made available to the courts, the prosecutors, the Department of Corrections, and to all of the youth-serving agencies that seek to prevent delinquency, and to help young offenders become law-abiding citizens. The budget reflects much of this need.

STRENGTHENING THE POLICE DEPARTMENT

For the Police Department itself, the budget provides--

• Additional civilian positions and additional computer services to carry forward the planning and information activities of the Department. When these activities are fully staffed, they are estimated to achieve greater manpower utilization in the Department equivalent to 600 additional policemen.

• Additional civilians to relieve policemen from clerical duties, and to assist in improving the Department's community relations, training, recordkeeping, and criminal investigations.

• Additional sergeants--from a ratio of 1 :20 patrolmen to 1 :9--to improve the supervision of patrolmen.

• Increases in the Police Cadet program and in the number of school crossing guards.

• Increased police mobility through additional automobiles.

The 1967 supplemental budget for the District will provide an additional $420,000 to expand and modernize the police communications system.

I shall also transmit to the Congress a bill to provide an increase in the salaries of the Police Department, to be applied principally in the lower ranks as an aid to recruitment of policemen of high quality. The 1967 supplemental budget will request funds to make this increase effective on May 1, 1967. This increase along with that already authorized by the 89th Congress and the District's more successful recent recruiting efforts should bring the Department very near its authorized strength in fiscal 1968. A direct result of this will be a saving of $2 million in tactical force operations, since there will be a sharp decrease in the need to staff this force on an overtime basis by the use of patrolmen on their day off.

CRIME PREVENTION AND OTHER CRIMINAL JUSTICE PROGRAMS

These improvements in the Police Department will fail to realize their full potential, however, unless improvements are also made in other areas. The crime prevention budget, therefore, also includes funds for A major increase in the staff of the Roving Leader program, which has had marked success in working with youth gangs and delinquency-prone young people.

• Stepping up sharply the transfer begun in fiscal 1967 of children from large institutions to group shelters, foster and pre-release homes. Funds are provided to add 20 group foster homes to the 6 funded in 1967 and to provide 8 youth group homes for delinquent children. The savings in cost to the District will be substantial because the present system of institutional care is expensive.

• Additional child support and probation workers for the Juvenile Court.

• A research unit to permit the Juvenile Court to determine how to improve its operations and procedures.

• Strengthened court services, including increased legal assistance to indigents in the Court of General Sessions.

NEW FACILITIES

The budget also reflects the urgent recommendation of the Crime Commission that if the war on crime is to be effective, major improvements are needed in the District's physical facilities. Funds are provided to construct, at Blue Plains, the new police training facility. Survey funds are included to make comprehensive studies for a roodern detention and diagnostic facility to replace the D.C. jail, for new court facilities, and for a modern facility to replace the present Receiving Home. Funds are also provided for plans and specifications for an alcoholic treatment center at D.C. General Hospital, which will continue and improve the adjustments made necessary by the long overdue removal of the chronic alcoholic from the criminal process.

HEALTH

The budget provides a total of $66.5 million for the operation of public health and vocational rehabilitation programs for 1968, an increase of $8.2 million over 1967. These funds are needed to improve a variety of services, and to remedy some serious deficiencies.

The Department of Public Health has made impressive gains in recent years. Much more will be possible, with additional Federal assistance, when present laws are amended to permit the District to join the many other States which are receiving Federal assistance in local health activities under Title XIX of the Social Security Act. Under that program, not only will many more District residents receive needed medical attention, but increasing pressures upon both D.C. General Hospital and Children's Hospital will be eased. I urge the Congress to give prompt attention to the necessary legislation.

The budget will maintain the momentum of prior years, and make other essential improvements. It will-

• Increase the number of nurses, nurses' assistants, and the capacity of the nursing school at D.C. General Hospital. These increases, together with the improvement in the recruiting ability of the hospital which will result from the recently announced pay increases for nurses, should materially improve the quality of nursing care at the hospital. More funds are also provided to the hospital for supplies and equipment.

• Provide expanded services for the aged, through a Geriatrics Clinic at the Potomac Gardens public housing project for the aged, and through an increase in home health services.

• Permit payment to contract hospitals and Freedmen's Hospital of their reasonable costs for the services they provide the medically indigent residents of the District, in conformance with the criteria set forth in Public Law 89-97.

• Provide plans and specifications for the Northwest Community Health Center.

The average daily patient load of St. Elizabeths Hospital for which the District is responsible continues to decline. The per diem cost, however, continues to increase so that an additional $3.6 million will be required in 1968.

WELFARE

The budget provides $40.3 million for the Department of Welfare in 1968, an increase of $7.7 million over 1967.

The operations of the Welfare Department continue to reflect efforts to rehabilitate individuals and families, increase their self-sufficiency, and in as many cases as possible assist them to become self-supporting. Funds are provided to maintain the present ratio of social workers to families with dependent children, to complete the basic staffing for two recently established Neighborhood Centers, and to meet additional staff needs for the aged at D.C. Village. Funds are also provided to staff the new District facility which will replace the present National Training School for Boys.

Many special welfare programs have been established in recent years to meet the needs of the less advantaged. The budget will permit intensifying this effort by --

• Expanding the Crisis Assistance and Emergency Family Shelter programs.

• Continuing and improving the training and job placement assistance programs for unemployed parents of needy children. This effort will continue to be closely related to the work training program financed under Title V of the Economic Opportunity Act, and provides for the removal of limitations that now prevent Federal assistance under the Social Security Act.

• Paying the actual rental expenses of public-assistance recipients if their quarters meet building code requirements and a reasonable standard of maintenance.

• Further expanding the Day Care program.

PARKS AND RECREATION

The needs of those agencies concerned with parks and recreation will require $17.6 million, an increase of $4.3 million over 1967.

The additional funds will permit a substantial expansion of supervised recreational activity. The major portion, $2.5 million, will provide a comprehensive summer program for youth, combining organized recreation with educational and pre-school training. These funds, together with $500 thousand which will be included in the supplemental 1967 budget, are needed to continue and improve the District's summer programs for young people. During the past a years District programs have been among the most successful in the United States. Their value can no longer be doubted.

Funds are also provided for more adequate coverage of existing facilities, for more hours of operation of 90 playgrounds recently lighted for night use with the help of private contributions, for an extended summer season for swimming pools, for expanded recreation programs serving the physically handicapped and the mentally retarded, and for staffing the Buchanan playground which will also be improved by a grant from the Astor Foundation.

The capital budget reflects an urgent need to increase the recreation facilities available in the District. A total of $4.1 million is proposed to provide, among other things--

• Acquisition of the old car barn on East Capitol Street for development into a Community and Recreation Center to serve an area badly in need of such a facility.

• Construction funds for two swimming pools, and plans for four more.

• Reconstruction of the Chevy Chase Community Center, for which Congress in fiscal 1967 provided funds to prepare plans and specifications.

The 1967 supplemental budget will provide funds to make available next summer 15 walk--to-learn-to-swim pools for younger children.

TRANSPORTATION

The budget reflects the substantial progress toward an ultimate solution of the transportation program that was made during the past year.

The mass transit program moved closer to the regional system which I recommended when the 89th Congress enacted for the District and granted Federal consent to the compact creating the Washington Metropolitan Area Transit Authority, with power to plan, finance and operate a regional system. Maryland, Virginia, and the District have already provided funds for the operation of the Authority in 1967 and are budgeting funds for that purpose in 1968.

Funds are already available to permit continuation of preliminary engineering and construction work by the National Capital Transportation Agency on that part of the system authorized by the Congress in 1965. Funds for the District's share of the engineering and construction costs of the Authority are authorized. Although the Authority does not come into being officially until February an, 1967, the provisional Board of Directors has been actively at work for several months.

Agreement reached during 1966 by the Policy Advisory Committee, and accepted by the District Commissioners and the National Capital Planning Commission regarding the location of interstate freeways within the District, together with the increased funds resulting from the additional borrowing authority made available to the highway fund, have made it possible to provide adequate funds so that the entire freeway program can go forward. In addition, the budget provides funds through the Council of Governments for the District's share of the expenses of the regional planning, including transportation planning, being undertaken jointly by the local governments in the National Capital Region.

OTHER

The major portion of the budget is related to the programs already mentioned. Other budget proposals of particular significance include--

• Funds for a major increase in sanitation services, to permit more frequent street cleaning and more efficient refuse collection.

• Funds for the construction of the new central Public Library.

• Funds to enable the Public Library to send books to 16,000 kindergarten children, to enlarge their horizon through the world of books. Books for these children are even more important than the books already provided by the Library to children in the elementary schools and in many junior high schools.

• Funds to augment the staff of the Commissioners' Council on Human Relations. The services provided by the Council have been important, but much more can and should be done.

• Funds for a Civil Rights Division in the Corporation Counsel's office.

• Funds to prepare preliminary plans for two new buildings in the Municipal Center area. These buildings will not only provide the District with badly needed office space, but also help to carry out the long-range plans for Pennsylvania Avenue.

• Funds to conduct the 1968 Presidential election in the District.

CONCLUSION

This budget which I am recommending reflects the needs of local government in an increasingly urbanized society. The District is no less subiect to these urgent needs than are other cities, and because in many ways it performs the function of a State as well, its responsibilities are even broader. To ignore the District's needs is to confess that the Capital City of this great Nation cannot cope with today's challenges. We must make no such confession. We must make the District of Columbia, rather, the pool that our civilization continues to secure to every citizen "life, liberty, and the pursuit of happiness."

LYNDON B. JOHNSON

January 25, 1967