WASHINGTON— District of Columbia officials are weighing how to handle an expected $400 million budget surplus from the 2012 fiscal year.

D.C. Councilman Jack Evans has said any surplus should be added to the district’s rainy-day fund to build its balance toward $1.6 billion. The city already has $1.2 billion in cash reserves.

The Washington Examiner reports that adding another $400 million to the D.C. savings account would place the district among the top 10 in the nation, if it were a state.

Norton Francis, a researcher at the Urban-Brookings Tax Policy Institute says that balance is a little high for normal times, unless there’s a serious threat to a state’s revenue.

The reserve fund can help protect the city if there’s a sudden downturn or cut in federal spending.

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