Delaware makes $27 million budget cuts to avoid deficit

Delaware lawmakers have proposed millions of dollars in cuts to its budget for the fiscal year beginning July 1.

 

On Wednesday, the State’s Joint Finance Committee completed $27 million in cuts from Gov. Jack Markell’s recommendations in order to avoid a deficit in the $3.9 billion budget.

The decision to make so many cuts was a difficult but necessary decision to make, said Chairwoman Rep. Melanie George Smith, D-Dover.

 “I believe in the long-term and the big picture,” she said. “The people of Delaware can be proud (that) police officers will be on the roads, protecting them from criminals, they can be proud there will be teachers in schools teaching their kids.”

In order to have a balanced budget, the J-F-C voted on across the board five percent cuts to items that were passed through to Wednesday’s meeting. It also shifted where funds will come from for some items, while other items cannot be funded at all.

The Committee began voting on the items Monday, and previously had made $18 million in cuts.

“Perhaps more cuts may be necessary as we move forward in the coming year. I guess this is a warning to all recipients, all agencies and the tax payers of Delaware, there may be deeper cuts in order to make a balanced budget,” said Rep. Joseph Miro, R-Pike Creek.

“I’m certainly not happy with some of things I had to vote for, but nevertheless that’s what it is.”

Some members of the Committee expressed their concern about the vote to make the 5 percent decreases across the board.

“This is really going to hurt people by taking this vote,” said Debra Hefferman, D-Bellefonte. “It’s really concerning.”

Programs face challenges

 

The reductions include a total of $144,300 for programs sponsored by Child, Inc., People’s Place and the Children’s Advocacy Center, all of which provide social services for children and families.

Environmental agencies like the Delaware estuary, the Center for Inland Bays and the Watershed Resources Agency had a total reduction of $25,000.

The Department of Education received a total reduction of $110,000 for several items, including the Delaware Institute for the Arts in Education, online periodicals and the Delaware Teacher Center.

On Monday, the Committee cut $527,800 for general assistance in social services, and a $125,000 reduction to Polly Drummond Hill yard waste.

“I’m not happy. I’m not happy with a lot of decisions we made,” said Rep. James Johnson, D-New Castle. “I wish we could have an honest discussion so we won’t have to go through this and not make people unhappy. I think we’ve all made tough decisions.”

During Fiscal Year 2015, the State received two settlements of $25 million and $36 million each. The first will go towards funding items the general fund couldn’t support, while the second is on hold until needed.

On Wednesday, the Committee voted to use $810,000 from the settlement money for one-time funding for non-public school transportation.

On Monday, the J-F-C voted to use the settlement funds on the presidential primary and the Department of Education IMS upgrade, each about $1.2 million. They also voted to use settlement funds to pay for $1 million for the Charter School Performance Fund.

The Sussex County Police also will see a shift in where its funding comes from. Currently, the county and the state split funding evenly to pay for the state troopers it uses.  Starting Jan. 1, the county will finance all $1.2 million.

On Wednesday, the Committee announced some items won’t receive funding from the general fund at all—including the Department of Agriculture. However, the State will transfer $508,000 from appropriated special funds to help operate the department.

The State also is waiting for $5 million from a piece of legislation that proposes to increase transportation fees to fund the Delaware Department of Transportation.  

While there were several cuts made on Wednesday, the Committee decided to put funding back into some agencies that had previously been taken off the table. This includes $12.5 million for elder tax relief and the education expense fund. The elder tax relief program gives seniors a credit on their property tax.

The Committee also is adding $300,000 in transportation funding for developmental disabilities services.

Non-public nurse, such as those in schools, also will receive $562,000 in funding. Miro expressed his support for this decision during the meeting Wednesday.

 “Nurses are a very important piece to health and welfare of entire state of Delaware,” he said.

“They are not only detecting health issues, but also interface with families when they perceive a problem, and that includes child abuse that nurses can detect by observing children.”

The Committee also will cut about $2 million in grant and aid on Tuesday. The House and Senate will vote on the $3.9 billion budget that same day.  

Tax increases on Delaware residents still is up in the air. Two tax increase bills will be voted on by June 30.

Several members of the Committee said while they’re not happy about making the cuts, they’re pleased with the outcome of their work to make the appropriate decisions.

“We have a budget we’re proud of given the resources we had we did the best we could,” said Joint Finance Committee Co-chair Sen. Harris McDowell, D-Wilmington.

A future of the same?

 

After the budget passes, the committee will focus on Fiscal Year 2017, which currently has a forecast deficit of $169.9 million.

Delaware may be able use $36 million from the upcoming budget as a surplus to apply in Fiscal Year 2017. The Committee also will spend the next six to nine months focusing on where it will make cuts or find the efficiencies. Smith also said policy changes may need to be made in order to create a balanced budget.

 “We’re going to be assessing real policy changes we need to make to define the savings we need to make,” she said.