Photo by Chris Rief aka Spodie Odie.

Most people would say that fiscal policy isn’t made overnight, but the D.C. Council seems to think otherwise.

In May, the D.C. Council decided to impose a tax on out-of-state municipal bonds, partly to prevent a competing proposal that would have raised taxes on District residents making more than $200,000 from passing. The bond tax wasn’t widely debated, and it quickly generated heated reaction from local bondholders and investors. As a consequence, certain councilmembers desperately began trying to find ways to scrap the bond tax, going so far as to propose using future revenues to pay the $13 million or so the city would lose next year without it. Over the course of a month, nothing seemed to work.

As the Council geared up for its last legislative session before its summer recess yesterday, rumors began circulating that Councilmember Mary Cheh (D-Ward 3) would propose increasing income taxes on District residents making more than $350,000. (Earlier in this budget cycle, she floated a similarly last-minute proposal to tax residents making more than $400,000.) It was a surprising move, though a quick way to get rid of the bond tax. During the afternoon, though, Cheh admitted that she didn’t have the votes for the tax to pass, so her proposal wasn’t even introduced. Instead, Cheh moved to use $13 million destined for the city’s savings account to delay the implementation of the bond tax by a year; her proposal passed, 7-6.

Feeling a little lost? You should be.

This year, the council has shown a remarkable tendency to propose and vote on significant tax changes at the last-minute, effectively shortchanging needed debate and leaving local fiscal policy in the lurch. The proposal to raise income taxes that was included by Mayor Vince Gray in his 2012 budget proposal was openly debated, but the bond tax that replaced it wasn’t. Ironically, it was that very lack of debate that led tax hike skeptics like Cheh to consider reversing course, if only to buy back a measure — the bond tax — that many of them voted for to begin with. Moreover, yesterday’s move to delay the bond tax for a year forces the District to spend from the very savings account that everyone from Wall Street to the council has agreed needs to be replenished after years of decreasing balances.

On the one hand, all of these last-minute changes and amendments are certainly part of the democratic process. But as the D.C. Fiscal Policy Institute has argued, maybe waiting 48 hours between when huge tax changes are proposed and when they’re voted on would be a good idea. For Susie Cambria, a consultant who follows D.C. politics closely, debates over taxes shouldn’t happen in the midst of budget season.

“With few exceptions, I think these discussions should happen outside of the budget process — this would allow both branches of government and the public to have a longer and presumably more thorough consideration of the issues at hand,” Cambria said. “Councilmembers and staff often tell the public that the budget process is longer than March through June. They should remember that and do oversight and the kind of in-depth thinking and research throughout the year so the entire process can be more productive and beneficial to residents and other stakeholders,” she added.

Fortunately, the 2012 budget includes the creation of a Tax Revision Commission that will work to analyze and propose changes to the city’s tax code. It’s possible that such a commission might help prevent last-minute tax debates in the future.