Delaware state budget

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Delaware passed a balanced budget bill for FY2010 and as of May 2010 is not operating in a deficit.^{[1] [2]} In May 2010, however, the Delaware Economic and Financial Advisory Council's revenue subcommittee met and determined that the state would have an extra $100 million.^[1] The council raised revenue estimates for FY2010 by $39 million, and estimates for FY2011 by $64.6 million. Because FY2010 is nearly over and the state isn't operating in a deficit, the $39 million will roll into FY2011.^[1]

Delaware will receive $76 million from the federal government as part of H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.^[3]

See also: The Delaware State Budget on State Budget Solutions

[edit] FY2011 State Budget

The state's FY2011 budget totals $3.3 billion.^[4] The House approved the budget with a 27-13 vote and the Senate by a vote of 16-4.^[4] The budget grew by 6.5%, although Gov Jack Markell said it included $48.9 million of cuts.^[4] House Minority Leader Richard Cathcart said that he was unsure how a budget that was supposed to trim spending with cuts ultimately grew by 6.5 percent.^[4]

The budget reinstates a 2.5% pay cut for state employees implemented in FY2010 to help balance the budget.^[4]

[edit] Federal Funds

Delaware will get $27.6 million for education and a $48 million in added support for Medicaid from the federal stimulus passed in August 2010.^[5] The Delaware State Educators Association predicts that up to 370 positions may be restored.^[5]

Delaware did not include the federal money in balancing this year's $3.3 billion budget, so the $48 million will be in addition to the already-approved funds.^[5]

[edit] Budget Figures

FY2011 Financial Package^[6]

Category	Amount
General Fund Operating Budget	$3,305,257,100
Bond and Capital Improvement Act	$389,748,931
*State Capital Projects	$248,758,731
::G.O. Bonds	$166,900,000
::Cash	$77,000,000
Programming	$4,858,731
*Department of Transportation Capital Projects	$140,990,200
::Transportation Authorizations	$126,990,200
::Cash	$14,000,000
Grants-In-Aid	$35,242,900

Budget cuts included^[7]:

• Realize full-year savings from FY 2010 statewide position reduction and eliminated an additional 525 positions in state government $9.3 million
• 10% cut to pass-through programs and instill greater accountability for the programs $1.5 million
• Maximize in-house resources and services at the Department of Services for Children, Youth and Their Families - $1.2 million
• Reduction in employee recognition expenses - $191,100
• Reduction in state agency printing and advertising expenditures - $1.4 million
• Reduction in general operating expenditures - $1.7 million
• Downsize the number of state-owned vehicles - $421,400
• Cut the State’s energy costs by implementing Executive Order 18 - $2.9 million
• Consolidate Information Technology resources statewide - $1.0 million
• Close a portion of the Multipurpose Security Building at Sussex Correctional Institution and move inmates to reduce overtime expenses - $650,000
• Move state tax filing systems from paper-based to online - $110,000
• Reduce EZPass Customer Service Center hours and automate 24/7 support services - $483,700
• Reduce Smyrna Rest Stop staffing hours - $207,900
• Reduce gypsy moth survey - $25,600
• Reduce supplies and materials funding in Department of Correction to accurately reflect need for resources - $750,000
• Reduce funding for Child Care due to reduced demand for service - $377,100
• Eliminate new wildlife habitat enhancement program conservation leases - $28,000
• Install Automatic Vehicle Locator devices in DelDOT vehicles to create operational efficiencies - $150,000
• Eliminate 4100 Continuous Feed Printer and co-locate DTI print staff at OMB - $229,000
• Eliminate state funding for State Accounting Course through the Department of Finance - $5,000
• Eliminate funding for Budget Commission - $40,000
• Eliminate funding for School to Work program - $20,000
• Eliminate printing of budget books and provide budget information electronically online and on cds - $10,000
• Reduce Maritime Exchange subsidy to reflect contribution equitable to surrounding states - $100,000
• Implement new lighting control system at DelDOT to save energy - $5,000
• Maximize resources and reduce funds needed to maintain DelDOT properties - $50,000
• Eliminate casual/seasonal funding for inland bays enforcement - $30,000

[edit] FY2010 State Budget

In July 1, 2009 the state closed an $800 million shortfall for FY 2010 by passing a budget smaller than FY 2009, cutting spending more than raising taxes, and setting appropriations at 98% of revenues. The 2% margin is set aside for a “rainy day fund.”^[8]

The Delaware General Assembly passed and Gov. Jack Markell signed a FY 2010 budget with $3.1907 billion in revenues and $3.1269 billion in appropriations. The budget reserve was $186.4 million as of August 15, 2009. Delaware saw a reduction in revenue projections by $303.6 million for FY 2009 and $648.4 million for FY 2010 before adopting its final budget. Delaware's top 3 revenue sources are 31.8% Personal Income Tax, 28.2% Corporate Franchise Tax & Fees, and 10.1% State Lottery. The state's top 3 General Fund appropriations are 36.3% Public Education, 30.5% Health & Family Welfare, and 16.5% Corrections.^[9]

FY 2010 budget was a 5.1% decrease from FY 2009. The FY 2009 General Fund was $3.363 billion, a 2.35% increase over FY 2008.^[10]

[edit] Budget Background

Delaware's fiscal year begins July 1 and ends June 30 of the following year. The state budget process begins in September when the budget office requests that each department in state government submit budget requests for the next year's budget. These requests are generally presented to the State Budget Office at public hearings held in October and November. Between November and January the Governor compiles a recommended budget which is then presented to both the House and the Senate in January.

According to the State Constitution, the Governor must present a budget which is balanced at 98 percent of the state's projected revenues. The Delaware Financial and Economic Advisory Council is charged with making revenue projections, which are made in September, December, March, April, May and June. The Governor's budget is assigned to the Joint Finance Committee. The budget bill is typically introduced and voted on during the last week in June, just before the General Assembly adjourns. ^[11]

[edit] Budget figures

Fiscal Year	General Funds Expenditures	% Change from Previous Year
2003	$2,454,100,000[12]	--%
2004	$2,553,700,000[13]	4.0%[13]
2005	$2,822,300,000[14]	10.5%[14]
2006	$3,180,500,000[15]	12.7%[15]
2007	$3,389,900,000[16]	6.6%[16]
2008	$3,421,600,000[17]	0.9%[17]

See Delaware state budget (2008-2009) for more information.

The Delaware Economic and Financial Advisory Council makes revenue and expenditure estimates on which the FY2011 budget is based and which the Governor used in his Financial Overview for FY2011.^[7]

General Fund Revenue Sources^[7]

Source	FY2010 Estimate	FY2011 Estimate
Personal Income Tax	$879.0 million	$951.7 million
Franchise Tax and Limited Partnership/Limited Liability Company Tax	$760.7 million	$737.5 million
Business and Occupational Gross Receipts Tax	$190.5 million	$190.5 million
Lottery	$288.7 million	$226.2 million
Corporation Income Tax	$47.5 million	$68.6 million
Bank Franchise Tax	$42.2 million	$35.6 million
Abandoned Property	$400.0 million	$380.0 million
Realty Transfer Tax	$40.4 million	$27.4 million

[edit] Accounting Principles

Main article: Delaware government accounting principles

The Delaware State Auditor since 1989 is R. Thomas Wagner, Jr.. Audit reports are published online.^[18]

Russell T. Larson is the Controller General. The Controller General reports directly to the Legislative Council, a joint committee comprised of the leaders of both houses of the Legislature.^[19]

The country's three major bond-rating agencies have affirmed Delaware's triple-A ratings based, in part, on the state's strong fiscal management practices. The agencies specifically cited state officials' decisions to appropriate only 98% of available revenue for the fiscal 2010 budget, which allows for a cushion if revenues fall, and the decision to maintain the Rainy Day Fund. The agencies also praised the Delaware Economic and Financial Advisory Council for its revenue forecasts.^[20]

Credit Rating	Fitch	Moody's	S&P
Delaware[21]	AAA	Aaa	AAA

[edit] Economic Stimulus Package

Delaware is expected to receive $802 million, not counting the tens of millions in tax cuts, increased unemployment benefits, student grants and other initiatives, of the $787 billion dollar economic stimulus package. ^[22] According to White House officials the package is expected to create approximately 59,000 jobs. ^[23]
For more information on how the federal stimulus funds are being used in the state of Delaware, visit the state recovery website.

According to preliminary reports Delaware is expected to receive:

• $3.6 million for mandatory transportation enhancements ^[24]
• $21.7 million for urban areas ^[24]
• $11.7 million for suburban areas ^[24]
• $3.2 million for rural areas ^[24]
• $81.6 million for transportation ^[24]
• $11 million for state and local law enforcement agencies ^[25]
• $38 million to make homes and businesses more energy efficient ^[26]

[edit] Budget transparency

Delaware currently has no statewide, official spending database online, despite multiple, recent attempts to pass legislation which would require such transparency. However, in May 2009, Governor Jack Markell announced that, by July 30, 2009, citizens will be able to see the state's expenditures online in a searchable database. Said Markell, "During these historically challenging financial times, it is critical Delawareans are confident their state tax dollars are being spent as effectively and efficiently as possible."^[27] Sign up here to learn more about Delaware's transparency.

The Caesar Rodney Institute recently launched an independent government spending transparency website, DelawareSpends.com, which allows users to search state employee payrolls and vendor payments. Visitors to the site can also post their own data, thoughts, questions, and concerns on the DelawareSpends Forum.

See also: Evaluation of Delaware state website

[edit] Economic Stimulus Transparency

• The Economic Recovery and Reinvestment Act of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.^[28]

• It is estimated that Delaware will receive at least $502 million in federal funding.^[29]

• The economic recovery website for Delaware is available here.

[edit] Error in ARRP

On November 16 and 17, 2009, many errors were found in the $747 billion American Recovery and Reinvestment Act that showed the plan set aside money for districts that do not exist. According to Recovery.gov, the plan shows its funds will go to 884 Congressional Districts, though there are only 435.^[30][31]

Delaware’s congressional representation rose by 4, according to ARRP's tracking website, as $10 million dollars was pumped into 4 congressional districts that did not exist.^[32]

[edit] Legislation

None.

[edit] Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases

State Database	Searchability	Grants	Contracts	Line Item Expenditures	Dept/Agency Budgets	Public Employee Salary	Exemption Level
None	n/a	n/a	n/a	n/a	n/a	n/a	n/a

[edit] Limitations and Suggestions

[edit] Support for creation of the database

The National Taxpayers Union urged legislators in Delaware to support SB 184, which would have created a state spending transparency website.^[33]

[edit] Independent transparency sites

None.

[edit] Public employee salary information

None.

[edit] See Also

Delaware taxpayer-funded lobbying

[edit] External links

• State Budget Solutions, Delaware
• Model transparency legislation from the American Legislative Exchange Council is available at this link.
• Caesar Rodney Institute
• Delaware Office of Management and Budget
• Delaware General Assembly
• Delaware state site

[edit] Additional reading

• Information on Delaware's Budget Development
• FY 2009 Budget, as enacted by the legislature at the end of June 2008.

[edit] References

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	v • d • e State of Delaware Dover (capital)
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Divisions	State | List of Counties | List of Cities | List of School Districts | Evaluation of State website | Evaluation of county websites | Evaluation of city websites | Evaluation of school district websites |
State spending	State budget | State salaries | Stimulus allocations | Taxpayer-funded lobbying |
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