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For the third year in a row, D.C. ended the year with a budget surplus, this time reaching $321 million.

At a press conference, Mayor Vince Gray said the city’s “rainy day” fund reached $1.75 billion in fiscal year 2013. However, “this does not mean we can go on a spending spree,” Gray said. Most of the $321 million surplus is already spoken for and will be placed in “legally mandated reserve or escrow accounts,” with just $9.6 million to be deposited in the locally mandated reserves as otherwise uncommitted funds.

Chief Financial Officer Jeff DeWitt said the Comprehensive Annual Financial Report showed D.C. in an “excellent” position. The surplus — which came from higher-than-estimated tax revenues and underspending by city agencies — is expected to help raise D.C.’s bond rating.

Gray, along with Council Chair Phil Mendelson and Councilmember Kenyan McDuffie (D-Ward 5), announced a plan to set aside 50 percent of future surpluses for the Housing Production Trust Fund to create more affordable housing. This will happen once the fund balance meets the recommended level. The city currently has 45 days of operating cash on hand, with the goal being 60 days. To put it another way, the cash flow reserve is 52 percent full. It may take “a couple of years” until this new spending can happen, Gray said. McDuffie recently introduced a bill to set aside 25 percent of undedicated surplus funds into the HPTF.

Read the report here.