Economist: Proposed Trump budget could cost northern Virginia up to 10,000 jobs
Trump’s proposed budget, unveiled last week, looks to substantially beef up defense, while making major cuts to dozens of other departments, including roughly 13 percent to the Department of Transportation and Department of Housing and Urban Development (HUD), more than 31 percent to the Environmental Protection Agency (EPA), as well as a 16 percent cut to the Department of Health and Human Services (HHS).
“[The proposed budget] sets a bit of a precedent for dramatic shifts in our spending priorities that we haven’t seen since the Reagan era,” Clower told the Times-Mirror.
Clower and other local officials have cautioned that before people start to worry too much about the budget, Congress is likely to substantially alter or scrap it altogether.
At the local level, Clower thinks the region could benefit from increased military spending, but notes that, in many cases, that money ends up going to defense projects outside of northern Virginia.
Clower pointed out other sectors like personalized medicine, which is driven by northern Virginia’s proximity to John’s Hopkins and the National Institutes of Health, would also get cut under Trump’s proposed budget.
At the local level, Clower thinks the impact could vary depending on the jurisdiction. He notes that if people start to move out of the area, it could have a hit on housing and thus local tax revenues.
Lower government spending, Clower says, also translates to lower economic activity and employment and less demand for office space.
“It hits us from several different areas,” he said.
According to Loudoun County government, the county receives nearly $15 million in federal funds toward its $2.5 billion budget.
Loudoun County’s Section 8 Housing Choice Voucher and Community Development Block Grant programs account for approximately $9 million of that.
Under Trump’s budget proposal, these two programs would be impacted significantly.
County administration did not want to weigh in on the federal budget or its potential impacts to the county.
Leaders in neighboring jurisdictions, including Fairfax and Alexandria, have expressed fear that the Trump budget could affect low-income residents.
Alexandria Mayor Allison Silberberg (D) told the Washington Post her city would lose two grants from HUD totaling $1.2 million in the coming year if the Trump budget passes.
“These two programs provide affordable housing for renters and homeowners, and energy assistance that literally helps people pay for heat in the winter and cooling in the summer,” Silberberg told the Post. “These programs are not abstract. They’re real. People’s lives are on the line.”
Last week, Loudoun supervisors agreed to retain $4.9 million in excess unallocated funds from Loudoun County Public Schools’ self insurance fund to put in the county’s general fund as a precautionary measure.
Supervisor Matt Letourneau (R-Dulles), who requested to save the extra funds, said his decision was prompted by the “uncertainty” around the federal budget that could impact the county’s finances down the road.
The Dulles supervisor said the county’s budget staff continues to look at the federal budget closely.
“I think at this point we just don’t know what direction it’s going to go in,” Letourneau told the Times-Mirror. “We don’t know exactly what Congress is going to want to do, and how they’re going to do it, and what types of cuts they’re going to want to make, and which types of cuts they’re going to want to increase.”
Chairwoman Phyllis Randall (D-At Large) echoed Letourneau's comments.
“I am confident that senators and congresspeople from both houses and both parties will not let [the budget] stand, and there will be a lot of adjustments to this budget before it comes to fruition,” Randall said.
With roughly 15 percent of Metro’s funding coming from federal funds, another area of regional concern is cuts to the Department of Transportation.
Last week, Virginia’s representative on the Metro (WMATA) board, Second Vice Chairman Jim Corcoran, said Trump's proposed budget, paired with the lack of consistent and reliable funding from the feds and commonwealth of Virginia for
Metro could make the transit system’s budget woes much worse.
The transit system is currently facing a $300 million fiscal 2018 operating shortfall, and Corcoran said the gap could double to as much as $600 million by 2019.
“With Metro and the crisis that it is in, we do not need the federal government backing off its commitment to the number one way in which most federal workers get to work and get home from those jobs,” Tony Howard, president and CEO of the Loudoun County Chamber of Commerce, said.
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