Gandhi’s Parting Shot: Strong Economic Projections for DC
DC’s CFO retires June 1, but he delivers a host of good news to city politicians before he goes.
Hahaha! Nat Gandhi gets the last laugh.
The District’s outgoing chief financial officer issued his final revenue estimate Friday afternoon and predicted generous increases in revenue. Council members and the mayor have bristled and derided Gandhi for years for low-balling revenue estimates. Now, on his way out, he bestows a bouquet of robust revenues.
In the current fiscal year, Gandhi estimates increased revenues of $190 million. For 2014, his number crunchers see an increase of $177.8 million. Revenues could increase another $178 million in 2015 and keep rising to $199 million in 2016.
“These estimates take into account the likelihood of the sequester being implemented,” Gandhi’s office says.
In his letter to Mayor Vincent Gray and the city council, Gandhi wrote: “Population growth has been a major factor in increasing the District’s income and sales tax bases, and is also a major driving force behind rising home sales.”
Translation: newcomers to the nation’s capital—largely younger residents who work in the city and prefer it to the suburbs—are spending more and buying up homes in eastern neighborhoods such as Shaw, Petworth, Bloomingdale, and Eckington.
Reading deep into Gandhi’s assessment, you will find good and bad news about commercial real estate property taxes, the perennial gold mine for DC revenues. Gandhi notes a “remarkable turnaround” in fiscal year 2012 to a 6.2 percent increase, but he also predicts a slowing in the coming years.
For veteran voyeurs of the conflict between Gandhi and DC’s elected political class, Gandhi’s parting estimate presents an ironic and even delicious final episode: rather than his conservative estimates, which tended to rein in spending, Gandhi offers up extra millions for spendthrift politicians.
But he will be out of office June 1, so he leaves to his successor the job of keeping the politicians within the bounds of his estimates, or facing their wrath if revenues actually fall—which they might.