'Paper Savings' Understate D.C. Deficit, Kane Says
D.C. Council member Betty Aim Kane (D-At Large), responding to an audit that disclosed the cityÛªs first budget deficit in eight years, joined critics of the report yesterday who contend the it substantially understates the severity of the cityÛªs financial problems.</br></br>Kane, a member of the Finance and Revenue Committee, said Mayor Marion BarryÛªs administration used $13.9 million in leftover federal funds and fees to offset the reported deficit, but said the money represented only a ÛÏpaper savings" that had no real effect on other city spending.</br></br>The deficit of $14.3 million reported by Barry would have risen to $28.2 million without the change, said Kane.</br></br>She said she would use a council hearing on the audit today also to ask questions about why the city spent $8 million less than was allocated for the housing and econom-icdevelopment budget.</br></br>She suggested that the city might have been using the housing budget to cover overruns in other agencies.