WASHINGTON – Washington Mayor Muriel Bowser on Friday unveiled her last budget before she steps down later this year, a $21.2 billion gross operating spending plan that is sure to spark battles on the District Council and Capitol Hill, where Republican lawmakers have shown a growing willingness to interject themselves into local affairs.
Bowser’s proposal makes education and health care spending — especially for Medicaid — priorities but would cut funding for several areas, including $127 million set aside for future collective bargaining agreements and non-union pay increases for city employees.
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Notable in the proposal is the decrease in the proposed general funds budget to $12.7 billion, a 3.3% cut from 2026. General funds are what pay for city services. Bowser said the cuts are necessary because of a drop in revenue due in part to federal workforce reductions and rising costs, including higher Medicaid expenses and higher administration costs for the Supplemental Nutrition Assistance Program (SNAP), because of a change in federal law that shifted some costs to states.
Bowser, speaking to the Council, assured members the city is “not broke” as she walked them through what she called the three periods of her tenure, the days of growth, the COVID-economic years and post-COVID.
“We are adjusting to what DOGE has done to our workforce and commercial corridor,” she said, referring to the Trump administration's efforts to shrink the federal government. She said the rising costs and decreased revenue have left the city with an estimated budget gap to address.
“I think we all have to be clear-headed about where we are and what it will take to keep growing,” said Bowser, who has served as mayor since 2015 and has announced she will not be running for reelection this year.
Members of the council questioned Bowser and members of her staff on proposed targets, including taking aim at programs intended to help defray the cost of child care in a city where a family pays on average more than $25,000 a year for infant care, according to the advocacy group Child Care Aware of America.
The plan would cap the District’s child care subsidy program, which helps the city’s poorest families afford care, at 6,000 children. Families currently receiving the subsidies would continue to receive them. And it would eliminate a program that supplemented the wages of child care providers, a measure passed during the pandemic to help attract and retain workers to a field with historically low wages.
Council Chairman Phil Mendelson said the council would likely vote on the budget in June.
Washington's budget has been complicated in the last two years. In 2025 the House passed a federal government funding bill that would force the district’s government to revert to its 2024 budget parameters, effectively cutting $1.1 billion from its previously balanced budget midway through the financial year.
The remaking of the federal workforce by the Department of Government Efficiency heavily impacted the Washington region. Terry Clower, director of the Center for Regional Analysis at George Mason University, estimated more than 50,000 jobs were lost in the region. Clover said those job losses meant more than lost salaries and income taxes for the workers, also hitting businesses that support those workers.
The D.C. Office of Revenue Analysis estimated that Washington had a net loss of 22,000 federal jobs at a combined annual pay of more than $3 billion.
City Administrator Kevin Donahue said the reduction in the federal workforce, primarily by DOGE, cost about $325 million in lost revenue from cuts in jobs and the accompanying consumer spending. Those losses will be even higher in the 2027 fiscal year.