WASHINGTON - A bill that would establish a firm debt cap for the District of Columbia seemed less likely to pass yesterday after a hearing of the District Council's committee of the whole because of a disagreement over whether the cap should include all forms of debt, such as tax increment financing, or only general obligation bonds, as currently proposed in a bill by council chairman Vincent Gray.

The office of the chief financial officer is urging council members to include all of the district's tax-supported debt under the bill's proposed 12% cap, arguing that rating agencies and investors consider a city's entire debt when considering the quality of a given city's credit. According to CFO Natwar Gandhi, when including all types of debt, the district's debt ratio is at 9.7%, but is expected to increase to 11% in fiscal 2009 and peak at 11.8% in both 2010 and 2011.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.