Delaware state budget (2010-2011)

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Delaware passed a $3.3 billion[1] balanced budget bill for FY2010 and as of May 2010 was not operating in a deficit. 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.

Going into the fiscal year Delaware had a total state debt of $8,723,729,509 when calculated by adding the total of outstanding debt, pension and OPEB UAAL’s, unemployment trust funds and the 2010 budget gap.[2]


2010 State spending & deficit in billions[3]
Total spending Pension Healthcare Education Welfare Protection Transport Deficit Budget gap
$6.87 $0.39 $1.94 $1.51 $0.62 $0.65 $0.81 $6.5 $0.55
2010 Local spending & deficit in billions[3]
Total spending Pension Healthcare Education Welfare Protection Transport Deficit
$3.09 $0.04 $0.05 $1.79 $0.06 $0.24 $0.12 $2.8

FY2011 State Budget

The state's FY2011 budget totaled $3.3 billion.[1] The House approved the budget with a 27-13 vote and the Senate by a vote of 16-4.[1] The budget grew by 6.5%, although Gov Jack Markell said it included $48.9 million of cuts.[1] 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.[1]

The budget reinstated a 2.5% pay cut for state employees implemented in FY2010 to help balance the budget.[1]

The Department of Education received $1.099 billion, which was a 0.9% increase from the prior year.[4] Education accounted for 33% of the state's general fund spending.[4]

Federal Funds

Delaware was slotted to receive $27.6 million for education and $48 million in added support for Medicaid from the federal stimulus passed in August 2010.[5] The Delaware State Educators Association predicted that up to 370 positions would be restored.[5]

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

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 was set aside for a “rainy day fund.”[8][9]

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 were 31.8% Personal Income Tax, 28.2% Corporate Franchise Tax & Fees, and 10.1% State Lottery. The state's top 3 General Fund appropriations were 36.3% Public Education, 30.5% Health & Family Welfare, and 16.5% Corrections.[10]

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.[11]

Budget background

See also:Delaware state budget

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 were 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 was then presented to both the House and the Senate in January.

According to the State Constitution, the Governor must present a budget which was balanced at 98 percent of the state's projected revenues. The Delaware Financial and Economic Advisory Council was charged with making revenue projections, which were made in September, December, March, April, May and June. The Governor's budget was assigned to the Joint Finance Committee. The budget bill was typically introduced and voted on during the last week in June, just before the General Assembly adjourns.[12]

Budget figures

Fiscal Year General Funds Expenditures  % Change from Previous Year
2003 $2,454,100,000[13] --%
2004 $2,553,700,000[14] 4.0%[14]
2005 $2,822,300,000[15] 10.5%[15]
2006 $3,180,500,000[16] 12.7%[16]
2007 $3,389,900,000[17] 6.6%[17]
2008 $3,421,600,000[18] 0.9%[18]

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 was 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

Accounting principles

See also:Delaware government accounting principles

The Delaware State Auditor publishes audit reports online.[19][20]

The Controller General reports directly to the Legislative Council, a joint committee comprised of the leaders of both houses of the Legislature.[21]

The country's three major bond-rating agencies had 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.[22]

Credit Rating Fitch Moody's S&P
Delaware[23] AAA Aaa AAA

Economic Stimulus Package

Delaware received $76 million from the federal government as part of HR 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.[24][25]

Delaware received $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.[26] According to White House officials the package was expected to create approximately 59,000 jobs.[27]



According to preliminary reports Delaware was expected to receive:

  • $3.6 million for mandatory transportation enhancements[28]
  • $21.7 million for urban areas[28]
  • $11.7 million for suburban areas[28]
  • $3.2 million for rural areas[28]
  • $81.6 million for transportation[28]
  • $11 million for state and local law enforcement agencies[29]
  • $38 million to make homes and businesses more energy efficient[30]

Budget transparency

Delaware currently had 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 would be able to see the state's expenditures online in a searchable database. Said Markell, "During these historically challenging financial times, it was critical Delawareans were confident their state tax dollars were being spent as effectively and efficiently as possible."[31] Sign up here to learn more about Delaware's transparency.

The Caesar Rodney Institute recently launched an independent government spending transparency website.[32] The site 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 forum.[33]

See also: Evaluation of Delaware state website

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 was estimated that 69%, or over $541 billion, would be administered by state governments.[34]
  • It was estimated that Delaware would receive at least $502 million in federal funding.[35]
  • Delaware established an economic recovery.[36]

Government tools

The following table was 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
None Y
600px-Yes check.png
P
Partial.png
P
Partial.png
{{{1}}}
N
600px-Red x.png
N
600px-Red x.png
  • The Delaware website had a search function.
  • Grants were posted, but they much be searched for individually, and information on awarded grants was not available.[37][38][39][40][41]
  • Contracts were not available. Bid results were posted.[42]
  • The operating budget contains line item detail.[43]
  • Department and agency budgets were not available.
  • Public employee salaries were not available.

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.[44]

See also

External links

Additional reading

References

  1. 1.0 1.1 1.2 1.3 1.4 1.5 Whyy.com "Del. governor signs budget" July 1, 2010
  2. State Budget Solutions “States Hide Trillions in Debt” July 22, 2010
  3. 3.0 3.1 USA Spending, State Guesstimated* Government Spending
  4. Cite error: Invalid <ref> tag; no text was provided for refs named ed
  5. 5.0 5.1 "Federal bill sends $75.6M to Delaware" August 11, 2010
  6. FY2011 Budget Overview
  7. 7.0 7.1 7.2 Financial Overview FY2011
  8. Gov. Jack Markell Press Release, "Markell Signs Budget That Responsibly Closes Historic Shortfall," July 1, 2009
  9. FY 2010 Budget Highlights
  10. Delaware Office of the Controller General, "FY 2010 Highlights," September 28, 2009
  11. Delaware Office of the Governor, "Fiscal Year 2009 Highlights," July 1, 2008
  12. Delaware State Education Association,"The budget process," accessed March 24,2009
  13. State of Delaware,"Financial Summary FY 2005," accessed March 24,2009
  14. 14.0 14.1 State of Delaware,"Financial Summary FY 2006," accessed March 24,2009
  15. 15.0 15.1 State of Delaware,"Financial Summary FY 2007," accessed March 24,2009
  16. 16.0 16.1 State of Delaware,"FY 2008 Recommended Budget," accessed March 24,2009
  17. 17.0 17.1 State of Delaware,"FY 2009 Recommended Budget," accessed March 24,2009
  18. 18.0 18.1 State of Delaware,"Financial Summary FY 2010," accessed March 24,2009
  19. Delaware State Auditor Web site, accessed October 13, 2009
  20. Audit reports
  21. Delaware General Assembly Web site, accessed October 13, 2009
  22. Gov. Jack Markell Press Release, "Delaware Receives Triple-A Rating," October 7, 2009
  23. California State Treasurer, “Comparison of Other States’ General Obligation Bond Ratings”
  24. Federal Fund Information for States “ARRA FMAP Extension & Education Jobs Fund Totals” Aug. 11, 2010
  25. H.R. 1586
  26. Governor of Delaware,"Stimulus Package would Create Jobs, Fund Critical Infrastructure Improvements ," February 18,2009
  27. American Recovery and Reinvestment Act,"Estimated job effect," accessed March 24,2009
  28. 28.0 28.1 28.2 28.3 28.4 Philadelphia Business Journal,"Feds release $1.8B in infrastructure funds for tri-state area," March 3,2009
  29. During National Police Week, Kaufman Urges Expeditious Infusion of Funds for State and Local Law Enforcement," March 12, 2009
  30. Community Pub,"Feds pledge $38 million to make Delaware greener," March 24,2009
  31. State of Delaware, "Delaware State Government would Open Checkbook to Public," May 7, 2009
  32. DelawareSpends.com
  33. DelawareSpends Forum
  34. National Taxpayers Union, "A Letter to the Nation's Governors: Ensure Transparency and Accountability by Posting Stimulus Expenditures Online," March 10, 2009
  35. Wall Street Journal, "Stimulus Spending by State"
  36. Delaware Economic Recovery
  37. OHS Grant Information
  38. Loans/Grants/Cost-Share Division of Soil & Water Conservation
  39. EECBG Program Sub-Grants to Local Governments
  40. Grants for Wastewater Facility Planning
  41. Delaware Land and Water Conservation Trust Fund Grant Program
  42. Bid Results
  43. Operating Budget, 2011
  44. National Taxpayers Union,"An Open Letter to the Delaware State Senate: Taxpayers Support Spending Transparency Web Site (SB 184)," March 7, 2008