The D.C. City Council recently approved a $5.06 billon local budget for fiscal year 2007, up 5% from the previous year, with new funding directed toward affordable housing and education and the continuation of many initiatives created last year.

And when it came to homeless services, the amount of money allocated toward these programs increased to $37.9 million. Funding was also finally approved to support two of the city’s recent initiatives to improve homeless services and end chronic homelessness.

Included in these funds is $1.7 million from the increase in the sale and transfer tax, which will go toward shelter beds and educational assistance for homeless youth and emergency family case management. An additional $1 million was also added to the budget to bring new case managers to the Federal City shelter.

The Mayor allotted $10 million for his Homeless No More program, but advocates discouraged full funding of the initiative, citing a lack of detail in the plan. The Mayor responded by sending a letter to advocates and council members explaining where the $3 million in new Homeless No More funds would go: $1.5 million in rent subsidies for families transitioning out of shelters, $1 million for case management, and $500,000 for a “Family Assistance Center” that has yet to be created.

There is also money in the Department of Human Services’ budget to implement pieces of the Homeless Services Reform Act that was passed last summer, which is supposed to improve oversight and client rights at D.C. shelters.

“Homelessness isn’t so much a matter of funding as planning and implementation,” said Ed Lazere, executive director of the D.C. Fiscal Policy Institute. “It’s, ‘Are they going to do what they said they were going to do?’”

While much of the rest of the budget was unremarkable, with few new programs, the biggest change was in the significant new resources devoted to affordable housing. Mayor Williams relied heavily on the recommendations of his Comprehensive Housing Strategy Task Force to shape affordable housing plans in the budget.

He raised taxes on the sale and transfer of residential properties from 1.1 to 1.5 percent to generate revenue to implement the recommendations, including funds for the Housing Production Trust Fund (HPTF), which was created in 1989 to finance the construction and renovation of affordable housing in the District. After heated debate, the Council agreed to levy the tax increase on commercial as well as residential properties but lowered the rate to 1.45 percent.

The tax increases will create $88 million in new revenues, $56 million of which will go to affordable housing initiatives. The Council allocated $15 million for the HPTF and $41 million for the housing task force trust fund, which has allotted $7.5 million for emergency assistance for families behind on rent, mortgage or utility bills, $6 million for the Low Income Home Energy Assistance Program, and $4 million for mental health housing (this represents the maintenance of existing funding).

$5.8 million was set aside for the “New Communities” initiative to convert distressed neighborhoods into mixed-income areas, and another five million will go toward rental assistance for moderate-income workers. The task force fund also assigned $250,000 to hire a “housing czar” to coordinate affordable housing initiatives in the city and $80,000 to commission a study on links to commercial growth.

And in a last-minute change, $7 million was diverted from the fund to pay for 100 new police officers.

Critics noted that Mayor Williams should do more to fund implementation of the ambitious recommendations of the housing strategy task force, which advocates a $3 billion increase in funding and 50,000 new affordable housing units by 2015.

Still, Martina Gillis, advocacy coordinator for the Fair Budget Coalition, said that the budget sufficiently addressed most of the needs of the city’s low-income residents.

“Overall, I think no- and low-income community members did pretty well in the budget this year, but we are disappointed that they diverted $7 million to the police, because a rent supplement is really important for residents who are being squeezed out of the housing market,” said Martina Gillis, Advocacy Coordinator for the Fair Budget Coalition.

On June 6, the full council will vote on this year’s Budget Support Act, the legislation that supports the budget, before submitting the final budget to Congress. The budget must receive congressional approval before it can take effect on Oct. 1.

To learn more about the District’s budget process, check out the D.C. Fiscal Policy Institute’s budget toolkit.