The District government spent $55 million on snow removal from one storm in January — more than it cost to get rid of snow in the past seven years combined.
Aides to D.C. Mayor Muriel E. Bowser (D) said the administration had no choice: The snow threatened to paralyze the District, and to get plows and dump trucks going, the city had to hire contractors — a lot of them, and fast.
But officials did something unusual — they charged almost half the expenses on city credit cards.
That sent the city’s credit-card balance soaring to roughly 20 times its usual level and prompted lender J.P. Morgan last month to take the unprecedented step of shutting off the city’s credit cards until the balance is paid.
After a couple of days, the city and the creditor reached an agreement to temporarily allow the use of credit cards in order to keep municipal agencies running. On Tuesday, the D.C. Council took the first in a series of emergency actions to repay debts related to the storm, officials said.
“We try to tell people to manage their own affairs, but this doesn’t seem like good management of financial affairs,” said D.C. Council member Mary M. Cheh (D-Ward 3), who has oversight of snow removal. She said she was surprised by the amount the city spent and by how it paid the bills.
Bowser administration officials have not said how much the city is incurring in late fees because of its unpaid balance, which reaches into the millions.
Spokesman Michael Czin said that because of restrictions in city contracting law, it was often most expedient to charge the cost of snow removal.
“The mayor has the ability to deploy resources as needed in an emergency, and using credit cards was the fastest way to pay vendors for their services,” Czin said. “Our priority was on getting contractors down here in a timely manner, and it was also important we continue to pay them in a timely manner so that it doesn’t impact our ability in the future to hire as needed.”
Paying off the debt hasn’t been as easy, though.
Bowser notified the council in February that she was withdrawing $55 million from city contingency funds to pay for the snow removal.
But a dispute with attorneys for the D.C. Council has in part held up payments. D.C. law requires any contract of more than $1 million to go before the council for a vote. And many companies that received multiple payments by credit card were paid more than that.
Many companies also refused to accept credit-card payments because of the fees that banks charge and other issues.
On Tuesday, the council voted to approve $10.2 million in emergency expenditures to pay mostly D.C.-area construction crews for services rendered immediately after the storm.
In coming weeks, the council will consider $24 million in credit-card debt, Czin said.
The city expects to receive more than $30 million in reimbursements from the federal government under a disaster declaration due to the storm, D.C. City Administrator Rashad Young told council members last week. But that will still leave the District with costs from the blizzard that will be equal to or greater than four years’ worth of the city’s snow budget.
A project manager for Citadel Firm LLC, which received the largest single credit card payment, $669,198, said it was unusual for a city to ask to charge so much work, but the company decided to accept the payment — and the transaction fees — because it had to hire many subcontractors and needed money for cash flow.
Another company, Virginia-based C.W. Strittmatter was paid $4,475,467 over 27 credit-card payments. The company provided 75 dump trucks and 20 pieces of equipment around the clock for one week.
In all, the city made 67 of the largest charges ever on District credit cards — each over $100,000 between Feb. 3 and March 4.
The project manager for Citadel, who spoke on condition of anonymity because he wasn’t authorized by his superiors to do so, said the District warned contractors that if they did not accept payment by credit card, it could take months to be paid.
The large one-time expense illustrates the perils of the D.C. government's decision not to plan for a snowfall as large as the one from January's storm, dubbed Snowzilla.
The District budgets for snowfalls of up to 18 inches, less than the 22 inches measured in parts of the city in January. The city’s $6.2 million annual snow-removal budget pays for about 700 pieces of equipment to cover its 68 square miles. At the peak of the February cleanup, the city had six times that number of trucks and heavy pieces of machinery on city streets, with some crews from as far away as Boston and Florida.
By comparison, New York City budgets $77 million annually for snow removal and dispatches 2,000 pieces of equipment across the city’s 302 square miles. On average, New York contends with 25 inches of snow each year, nearly twice what Washington gets.
Cheh has said the District needs to keep contractors on retainer for megastorms to clear walkways, bus stops and fire hydrants. But she said the city government seems to accept that it can prepare only so much for rare events.
D.C. Council Chairman Phil Mendelson (D) said he was stunned by the price of the cleanup for only one storm, but he was reluctant to budget $20 million or more for snow removal every year.
“The danger is if it doesn’t snow, that could just end up being a slush fund for District lawmakers to do with as they please,” he said.
