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D.C. Approves Revised Spending Plan

October 1, 2002

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WASHINGTON (AP) _ The District of Columbia Council, facing a serious fiscal crisis stemming from a $323 million shortfall, approved a budget Tuesday that raises taxes and fees for nearly 580,000 residents.

The measure includes increases in parking permits, taxes on tobacco and alcohol products, deed transfers and telephone and utility taxes.

The district’s financial problems are its worst since Congress imposed stringent financial controls on the nation’s capital in 1995.

The 11-2 vote on a combination of revenue enhancements and spending cuts came more than a year after the financial control board was dissolved.

In recent months, the district’s independent chief financial officer warned of looming deficits based on a combination of declining tax collections and investment values.

``The revenues went down in an economy that’s going down across the country,″ Councilman Harold Brazil said.

The cuts were made by trimming $201 million from city agencies, mostly by rescinding planned increases. The plan also adds $129 million in new taxes, fees and other revenues.

The budget must be presented to Congress on Wednesday.

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On the Net:

District of Columbia Government: http://dc.gov/

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