jonetta rose barras: Should the term of DC’s CFO be extended amid this political change?

On Christmas Eve, DC Del. Eleanor Holmes Norton announced she had reintroduced legislation to allow the DC mayor and council to determine the salary of the city’s chief financial officer. “Giving the District the ability to raise the pay for its CFO will make the position more lucrative and incentivize high quality candidates to apply when a vacancy arises,” she said in a prepared statement.

Glen Lee, who currently holds the position, was appointed to a five-year term in June 2022 by Mayor Muriel Bowser. He earns $292,300 annually, according to his office spokesperson.

The CFO’s compensation is higher than Bowser’s, a three-term mayor. It is also higher than that of the four-term DC Council Chair Phil Mendelson.

How much more does Norton think the CFO should be paid? 

Unquestionably, she is fixated on the wrong issue. Of more importance is the CFO’s performance, especially during this time of the White House madman and a stalled local economy. 

The CFO’s recent revenue forecast suggests more suffering is likely. The government shutdown and lack of transparency by Donald Trump’s administration have created “data gaps.” Federal job losses stalled for a while, but they haven’t stopped. Unemployment remains high. Withholding and all categories of sales tax collections have declined. Capital gains and corporate profits figure considerably in the CFO’s revenue estimate, “making financial market performance a significant risk” if setbacks occur.

“The S&P went up by 17 points. God help us if the market levels off,” said former Ward 2 Councilmember Jack Evans, who had oversight of the CFO’s operation until 2019 as the longtime chair of the Committee on Finance and Revenue.

“The city has overspent its means,” said Evans, adding that “we have spent money on intentions — not on results.” 

Lee told me during an interview last month that trends like remote working continue to hamper DC’s economy and are unlikely to change. “There is no returning to the way things were before.” That means there has to be “far more deliberation with all phases of [the] financial operation,” he added.

That gloomy picture is complicated by the political upheaval facing DC with the retirement of its mayor and three councilmembers (one of whom has already resigned, having said he is considering a run for mayor). Ambition is driving other elected officials to compete for different offices. All of that spells undeniable risk. 

Consider that whoever wins the mayoral seat this year will almost certainly lack a broad and deep background in municipal management. That person’s primary experience may be only as a member of the local legislature, which has repeatedly performed at a mediocre level.

The District’s overall economic circumstances were far better in the mid-1990s. Still, an inexperienced DC mayor brought the city to the brink of bankruptcy, despite being given a $300 million gift from a Congress that had celebrated the change of leadership. 

That history has some District leaders worried about the fiscal dangers ahead. If DC nearly went over the cliff back in the 1990s, who doesn’t believe the present scenario is dangerous for a city operating in hostile territory?

The Office of the Chief Financial Officer was established at the same time as the financial control board. With more than 1,000 employees, the CFO has been vested with sweeping authority and vast responsibilities such as certifying the city’s budget as balanced, setting limits and procedures to prevent federal and local Anti-Deficiency Act violations, and preventing the return of a control board. The combination of those duties and others was also intended to embed greater fiscal discipline within the government and among elected officials.

Lee might be perceived as the sentry who is protecting the city against a possible takeover. But he may be unable to perform that function effectively for very long, especially since his statutory term ends six months after the January 2027 installation of new leaders who are unlikely to be fully versed in the city’s fiscal management issues.

Some folks I spoke with for this piece suggested that his term be extended now through at least 2028 to ensure a longer runway. When I asked Lee about his intentions, he was adamant. “I am here for the duration of my appointment.

“I view staying longer strictly up to the mayor and council. I am not going to presume any outcome,” he added.

Lee is DC’s fourth independent CFO. The first was Anthony Williams. He was appointed by then-Mayor Marion Barry, although Williams mostly worked under the five-member control board. 

He cleaned the mess left by Mayor Sharon Pratt and her finance chief Ellen O’Connor. He also set a performance standard; after receiving a qualified annual audit, he pledged that he would resign if the results were no better the following year. He stayed in place. Soon after, a group of politically engaged civic leaders drafted him for mayor. 

Lee is no Anthony Williams. Neither was Natwar Gandhi nor Jeffrey DeWitt — CFOs two and three. 

As the former finance chief for Seattle, Lee came with a strong background. His performance reviews have been mixed, however. 

“I think he should stay,” said Gregory McCarthy, who has decades of experience in local government affairs, including advising Williams’ mayoral administration on intergovernmental relations.

McCarthy acknowledged that Lee was slow to bridge the gap between his responsibilities in Seattle and his tasks in the District. “Here the CFO is like a third or fourth branch of government with a dotted line to Congress.

“He is set up to call balls and strikes,” explained McCarthy, noting that Lee “broke some china” while working with the mayor and council. “He is not a politician like Tony Williams in that regard.

“I think he’s coming into his own light. I’m high on him,” added McCarthy, who is currently a vice president with the Washington Nationals. 

I have blamed some of Lee’s early missteps on retaining senior-level staffers such as Angell Jacobs and David Tseng, controversial figures who have been with the office for more than 20 years. When I mentioned this to Lee, he told me that when he first arrived, the agency was weeks away from implementing a financial management system it had taken three years and dozens of modifications to finalize. Staff were being trained. 

“It was difficult. That was the wrong time to implement wholesale staff changes,” said Lee, noting that “I am proud of the organization.”

One political observer advocating an extension of Lee’s term described him as “perfect for the job. He’s low-key and not too political. What’s important is that he knows what he’s doing.“

Another insider was less supportive. “Glen should leave when his term ends. He’s never been able to evolve from CFO of Seattle to CFO of Washington, DC. He doesn’t seem to understand he is more powerful than the mayor and council.”

DC Auditor Kathy Patterson has been critical of the office during Lee’s tenure, including its failure to effectively use its authority. “The sole reason for giving the CFO extraordinary independence in the 1990s was to control agency spending,” she told me during a recent interview. “The CFO has ample authority to say ‘no’ to agencies as they exceed their council-approved budgets — essentially to say ‘no’ to the elected mayor. 

“No one says ‘no’ today,” continued Patterson. “Over and over, the CFO team helps overspending agencies get more funding through reprogrammings and use of contingency reserve funds.”

Will a new CFO, unfamiliar with the city, be more predisposed to using the office’s inherent power? Will that person be more effective at forcing changes in the fiscal behavior among executive branch managers and councilmembers, many of whom are unrepentant spendthrifts who frequently fail to determine whether taxpayers are getting the maximum bang from their enormous investments?

The city’s budget for fiscal year 2026, which began Oct. 1 and continues to Sept. 30, is $22 billion — a substantial sum for a city with slightly more than 700,000 residents. Still, Lee recently certified $51 million was available for contingency spending by legislators that ought to have gone into a reserve fund. 

DC has four such accounts. Two were established by federal law; the council created the other two. There are rules about when those funds may be used and how soon they must be repaid.

During last year’s budget deliberations, Lee, Bowser and Mendelson tangled over using an end-of-year surplus to replenish certain reserve accounts. They reached a compromise, but the council changed the rules governing repayment of the locally created reserves.

The FY 2026 Budget Support Act mandated that part of any surplus be used to fund a list of priorities created by several councilmembers — including Ward 4’s Janeese Lewis George, now a candidate for mayor — hence the $51 million allocation. 

Interestingly, at the time Lee certified the availability of those funds, two of the reserve accounts had not been fully replenished. The federally mandated contingency reserve fund was only at 25% of its legally established mark as of the end of fiscal year 2025, according to preliminary figures. The council-established fiscal stabilization reserve was at 42%. The other two — emergency reserve and cash flow — were at 100%, however.

The CFO’s spokesperson indicated in an email earlier this week that the “year-end closing process” for FY 2025 has not yet been completed. “The reserves will be replenished accordingly based on the available funds and legal requirements.”

I have written multiple times about how the mayor and council regularly attempt to draw money from the city’s savings account. I do not expect the current underfunded reserves to reach 100% anytime soon. 

When I asked Mendelson during a recent telephone interview about the $51 million and the status of reserve accounts, he told me, “The reserve doesn’t matter in the moment. [It] can be paid back between now and 2027.”

He also said he is “less concerned about revenues. My concern is about spending,” citing as an example the police contract signed by Bowser that will increase spending by 13%. 

He said the combination of that expense, general budget increases of about 3.5% and continued overspending by multiple agencies is worrisome. “The CFO is not controlling that,” added Mendelson, who in October had a series of roundtables on overspending. 

He and his colleagues seemingly want to be rescued from themselves, or maybe to have someone else to blame for why they can’t fund certain programs or services. Truthfully, if they want to rein in overspending, they could start by disapproving the vast number of reprogramming requests they regularly receive from the executive. 

Lee could do the same. During the October roundtable, he seemed to suggest things were about to change; he and his staff responded to council questions by talking about tighter oversight and more adherence to the city’s established rules. Lee followed up this week with an offer to hold further meetings with legislators who chair committees to discuss oversight and overspending.

We’ll have to see whether Lee actually uses his big bite or whether he continues ineffective fiscal talk therapy. That ultimately may be the key to whether he remains on the scene or is asked to move on. Equally important: Who will be the ones deciding whether to invite him to stay?

McCarthy had this final word: “Wall Street doesn’t like change.”

jonetta rose barras is an author and DC-based freelance journalist, covering national and local issues. She can be reached at thebarrasreport@gmail.com.