The D.C. government will be able to devote more money next year toward affordable housing preservation, emergency rental assistance, DNA testing and more — a boost in funds made possible because of greater-than-expected revenue, according to the city’s chief financial officer.
The $51 million will be automatically directed to priorities listed by D.C. Council members during their budget process over the summer. The list identified programs that the council hoped to fund at higher levels but could not find money for — including a child care subsidy program, a fund that boosts pay for early childhood educators, a program that funds lead testing in charter schools and a program that provides health care to low-income undocumented residents who do not qualify for Medicaid. Now, a spokesperson for the chief financial officer said, all those programs can receive the additional funding.
The welcome boost comes as the city’s broader financial picture remains gloomy, with the economic effects of the Trump administration’s mass federal workforce layoffs still emerging but predicted to shrink city budgets significantly over the next several years. Still, in September, D.C. Chief Financial Officer Glen Lee concluded that the city’s tax revenue was higher than expected, freeing up hundreds of millions of unexpected dollars. On Christmas Eve, Lee wrote in a letter to D.C. Council Chairman Phil Mendelson (D) that the $51 million was indeed available for unfunded council priorities.
The largest portions of that money will go toward two programs: the Housing Production Trust Fund and Health Care Alliance program, the city’s main vehicle for insuring immigrants ineligible for other government health care programs.
The House Production Trust Fund will receive $10 million from the revenue windfall, which will be directed to preservation of existing affordable housing.
The Alliance program — which serves immigrants who are blocked from Medicaid because they are undocumented, in the country legally on a work permit or on temporary protected status — will receive $21 million. According to the budget legislation passed by the council, those funds could help the city maintain more services for people in the program.
However, eligibility for the Alliance program significantly narrowed in the fall. In addition to scaling back coverage for vision, dental and other health care costs, Alliance stopped accepting new enrollees above the age of 26 and cut its income eligibility for all adults. Restoring all of those cuts would cost the city $300 million a year, Deputy Mayor for Health and Human Services Wayne Turnage said this month. The program is experiencing its lowest enrollment in a decade because of the eligibility changes and an immigration crackdown by the Trump administration, which probably made people afraid to enroll, D.C. officials say.
The extra money will augment resources for the city’s child care subsidy program and help boost early childhood educators’ pay. The Department of Forensic Sciences will receive an additional $3.5 million for DNA testing. The surplus revenue will also raise emergency rental assistance funds by $2 million in 2026 and increase housing subsidies for police officers starting in fiscal 2027.
It was the second time in recent months that the D.C. Council opted to spend more than initially budgeted. In November, the council funded a child tax credit that policy experts say could be transformative for child poverty in the District — a move made possible by the higher-than-anticipated tax revenue and by the council’s decision to opt out of local versions of the federal tax cuts passed by Congress this year.
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