The Honorable Phil Mendelson, Chairman
1350 Pennsylvania Avenue, NW
Washington, DC 20004
June 10, 2025
Dear Chairman Mendelson and Members of the DC Council,
As the DC Council engaged with the Mayor’s proposed Fiscal Year 2026-2029 financial plan and Fiscal Year 2025 supplemental budget, DC Action urges you to prioritize investments in children, youth, and families, especially the District’s Black, brown, and immigrant residents who face the most systemic barriers to opportunity and who are under the greatest threat from this federal administration, and the District’s own Mayor. While we recognize this is a more challenging budget climate than the District has faced in recent years, the Council must still adopt a budget that reflects DC’s values by ensuring every young person’s education, economic, housing, health, and safety needs are met. We know that when we meet the needs of children, their families, and their caregivers – and make smart, equity-oriented decisions to grow the economy from the bottom up – the whole city thrives.
DC Action and the coalitions we convene – Under 3 DC, Youth Economic Justice, and DC Out-of-School-Time Coalitions – hope to work closely with you to make the following essential improvements to the Mayor’s proposed budget package:
- Augment the Pay Equity Fund by $10 million, recurring, in FY26 (OSSE, Division of Early Learning). As you know, the Pay Equity Fund has generated a 23% return on investment to the District, boosted the early educator workforce by 7%, incentivized credential compliance to over 80% across all educator positions, and improved the quality rating of early learning programs by 30% (see page 68 of OSSE oversight responses). The program is doing exactly what it is supposed to be doing and growth in the sector requires additional investment to keep pace with positive outcomes and cost of living. Specifically, we estimate the Fund requires a $1.4 million increase for HealthCare4ChildCare and $8.6 million for salaries. (learn more)
We share the Council’s concern about “gimmicks” in the Mayor’s 4-year budget proposal and do not want to see essential pay for early educators stolen, again, next year. However, we are also concerned that failure to guarantee recurring funding means driving early educators out of the workforce and unraveling the progress we have achieved. We must find a middle-ground; we look forward to working with you to identify long term financial and legislative safeguards for the Pay Equity Fund.
- Augment funding for the Child Care Subsidy Program by at least $20 million, recurring (OSSE, Division of Early Learning). Data provided by the Council’s budget office – and confirmed by OSSE at their June 4 budget hearing – shows $71 million in FY25 subsidy payments to providers to date. This expenditure averages $8.8-$10.1 million per month for current enrollment levels, depending on whether the last provider payments were issued in April or May. To simply maintain the program’s current enrollment of 6,700+ children (a 1,500 increase over FY2024), the subsidy program must receive $106.5-$121.3 million for FY26 using current monthly expenditure averages. Yet budget tables show the Mayor only allocated $86 million for FY26 (OSSE: $52.1M local, $10M federal; DHS: $24M local). Unless the funding gap is filled, provider reimbursement rates will be cut, jeopardizing their ability to provide quality care, new families will be placed on waitlists, and/or current eligibilities will be revised to limit access to affordable early learning opportunities. Subsidized child care is a lifeline for lower income District families, keeping as much as $24,000 in their pockets annually and enabling them to work and attend school; we cannot go back on all the progress we have made with this program. (learn more)
- Reverse the $1.38 million in cuts to the Youth Homelessness system to maintain level funding from FY25 for the “permanent supportive housing-youth” and “transition age-youth” lines of DHS’s Family Services Administration budget. Longer term placements and comprehensive support services funded by these program lines are where we see some of the greatest needs among youth experiencing homelessness; these youth deserve our full investments in the solutions and services proven to help them achieve stability, sufficiency, and safety.
- Ensure community-based Out-Of-School-Time (OST) programs can continue utilizing DCPS sites without charge. DCPS security, janitorial, meal, and other building use operation costs have historically been covered for OST organizations providing free programming to DCPS students. Providers urgently need certainty as they begin preparing for their fall offerings. Failure to protect this legacy of cost coverage will inevitably force providers to cut seats, hours, and/or staff at a time when DC students most need positive, enriching, safe environments. (learn more)
- Adopt germane Budget Support Act subtitles to achieve the following:
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- Permanent improvements to the Pay Equity Fund that set up the Fund for long-term stability, funding sufficiency, success, and protect against future attacks from the executive. Learn more.
- Proactive payments of grants issued by the Department of Human Services to improve payment efficiency and predictability for nonprofit service providers so they can deliver high-quality care to the District’s most vulnerable residents. Learn more.
- Regular creation and evaluation of a strategic plan to end youth homelessness to improve systems coordination, spending, and outcomes. Learn more.
- Restoration of paid family and medical leave benefits and UPL tax rate sufficiency. Learn more.
DC Action also urges the Council to protect the proposed funding levels in the Mayor’s budget and ensure they are recurring for the following programs our coalitions support:
- $27 million for out-of-school-time grants (DME)
- $3.2 million for Healthy Futures (DBH)
- $1.39 for HealthySteps (DC Health)
- $1.2 million for Home Visiting grants (DC Health)
- $770,000 for Home Visiting grants (CFSA)
- $225,000 for Home Visiting (DHCF)
- $324,000 for High School Internship Program (HSIP) participant wages (DOES)
- $2.18M for Year-Round Youth Programs participant wages (DOES)
Finally, DC Action has grave concerns about the attacks on economic stability programs in the Mayor’s proposed budget. Balancing the budget on the backs of working families and children does not advance a growth agenda, it grows inequality and instability and shortchanges the futures of our children. Medicaid, Alliance healthcare for immigrant neighbors, Temporary Assistance for Needy Families (TANF), Universal Paid Family and Medical Leave, DC Child Tax Credit, Baby Bonds, Emergency Rental Assistance (ERAP), housing vouchers and family homelessness intervention programs, school and crisis mental health services for youth, New Heights coordinators for DCPS’s parenting students, Supplemental Nutrition Assistance (SNAP), Women Infants Children (WIC), and the Earned Income Tax Credit (EITC) all provide essential supports to working families and their children and deserve your attention, investment, and restoration in the Fiscal Year 2026-2029 financial plan.
In order to fully fund the many critical programs listed above and build racial equity into our budget, tax, and policy decisions, we continue to urge you to adopt tax reforms that will create a more equitable and resilient tax base such as those supported by the Just Recovery DC Coalition. The JRDC Coalition’s tax justice platform would proactively help the District capture forthcoming federal tax cuts that will go to DC’s highest earners and wealthiest business operators who, for too long, have paid proportionally less in taxes than middle class families and small businesses.
We are grateful for your attention to our FY26 financial plan budget requests. Please follow up with Joanna Blotner, Director of Government Affairs, with any questions or clarifications about our priorities: jblotner@dckids.org or 202-427-2376 (cell). Thank you.
Sincerely,
Kimberly Perry
Executive Director
DC Action
kperry@dckids.org