Major Service Cuts Averted in D.C. Budget

By Tim Persinko and Tom Sherwood
|  Wednesday, May 25, 2011  |  Updated 8:11 PM EDT
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The D.C. Council reached a budget compromise Wednesday that includes cheaper parking meters, no income tax hike and restoring funds for homeless shelters.

Tom Sherwood

The D.C. Council reached a budget compromise Wednesday that includes cheaper parking meters, no income tax hike and restoring funds for homeless shelters.

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The D.C. budget battle was largely settled on Wednesday, with only minimal blood spilled.

Protesters were lined up for today's preliminary vote on the city budget, but by the end of the session, they had little to complain about: the Council was able to find funding to maintain most of the city's services.

Council Chair Kwame Brown told the meeting that opponents of the cuts got 95 percent of what they wanted today, NBC's Tom Sherwood reported.

When Mayor Vincent Gray submitted his proposed budget two months ago, the outlook for the city looked grim: curtailed social services, fare hikes on public transportation, and tax hikes for the wealthy were all on the table.

But the city got an unexpected windfall.  The robust local economy yielded better-than-expected tax revenue this year.  As a result, the cuts to social services in the mayor's original budget, totaling over $100 million, have largely been avoided.

Mayor Gray's proposed tax hike has also been avoided.  In the mayor's proposed budget, he called for raising the tax rate on households making over $200,000.  Opposed by Council Chair Kwame Brown, the measure was defeated.

D.C. residents even got a break from city fees today.  The Council agreed to reduce parking meter fees, reducing them to $1 an hour, down from the current $2 an hour.  Saturday meter enforcement will still remain in place.

A final vote on next year's budget will take place in two weeks.

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