Mayor of Washington, D.C., outlines spending cuts.

WASHINGTON -- District of Columbia Mayor Sharon Pratt Kelly has unveiled a multiyear spending-cut plan yesterday that is designed to comply with congressional demands for budget cuts.

The mayor's move came after the House and Senate, which have final say over the district's fiscal affairs, both voted last month to cut the district's fiscal 1995 budget. The House proposed cutting $150 million. double the $75 million approved by the Senate.

House and Senate conferees are holding their first meeting today to work out the differences in their separate pieces of legislation.

Kelly's emergency legislation, if enacted by Aug. 31, would save the district $102.6 million in the fiscal year that starts Oct. 1, she said in a letter to the city council,

"Swift, decisive and united action on the part of the mayor and the [city] council may well help to avert spending reductions as deep as those called for in the House bill." Kelly said in her letter.

The district could save about $20 million in fiscal 1995 through an employee buy-out program which expands the requirements for retirement. There are currently about 4,500 district employees eligible for retirement, but with the new proposal that number would grow to about 9,600.

Of those eligible for the buy-out program, City Administrator Robert Mallett said he expected about 2,500 to accept it.

The district also proposed privatizing many of its services, ranging from its traffic court to some correctional facilities. The district could save $750,000 in fiscal 1995 by privatizing a local waste facility, according to the mayor's report.

The mayor also proposed modifying several district programs including changing the general public assistance program to make the district's eligibility criteria consistent with the federal supplemental security income requirements, This program change plus several others would save the district over $76 million in the upcoming fiscal year. according to the mayor's package.

Along with the fiscal 1995 savings required to meet the Congressional mandate, the emergency legislation spelled out possible savings through fiscal 1999.

Privatization is the wave of the future for city governments, and the district is trying to keep in step with other cities its size, Mallett said.

The district stands ready with a list of services that can be privatized to allow the city to realize millions in savings, he said.

For example by privatizing a 225-resident nursing home, the district could save $5 million over five years. Privatizing two juvenile detention centers could save the district $5.1 million in the same time period.

Of the revenue initiatives the mayor's budget package proposes, one is to collect sales tax from the federally-owned Smithsonian museum complex. That would add $7.6 million to district revenues over five years.

Kelly presented her proposal to the city council yesterday, and the council has been asked to act before Aug. 31.

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