Plan focuses on strengthening economy, expanding opportunity, supporting families and workforce

WILMINGTON, Del. – Governor Carney on Thursday presented his Fiscal Year 2023 Recommended Budget virtually, sending the General Assembly a plan that will strengthen Delaware’s economy, expand opportunity, and supporting Delaware’s families and workforce.

“We made it through the worst of the pandemic without cutting services or raising taxes. Responsibly managing our state budget is more important than ever. This budget proposal will do just that,” said Governor Carney. “Delaware will come out stronger through this pandemic. That’s why we’re investing in economic development to prepare our state for the economy of the future. That’s why we’re continuing to invest in Delaware’s children, families and workforce. And that’s why we’re investing in protecting Delaware’s natural heritage. I want to thank members of the General Assembly for their partnership and for their consideration of this budget.” 

Fiscal Year 2023 Budget Highlights

• General Fund Operating budget totals $4.9 billion, limiting growth to 4.6%
• Sets aside over $15.2 million in reserves (after projected cash to bond bill and grant in aid)
• Appropriates $215 million toward one-time items in a separate supplemental appropriation bill
• Takes continued steps toward providing compensation and pay equity for state employees
• Increases Opportunity Funding investments in our schools for low-income students and English language learners
• Continues investments in clean water, economic development and fulfills our commitments to new school construction in all three counties
• Continues to fund secure and modern spaces for Kent and Sussex County courthouses

Preparing for the Economy of the Future

• Invests $60 million in economic development, including:
  • $30 million in strategic fund
  • $10 million in site readiness
  • $10 million in graduation lab space
  • $10 million in transportation infrastructure fund

Environmental Initiatives

• Invests $404.7 million in environmental justice, including:  
  • $30 million in aglands preservation and open space
  • $7.5 million in shoreline and waterway resiliency
  • $367.2 million in clean water, including $355 million in federal funding

Investing in Delaware’s Children

• Invests $339.9 million in funding school projects, including $19.8 million for the Wilmington Learning Collaborative and Redding Consortium
• Increases funding by $4.5 million for low-income students and English learner students towards achieving the goal of doubling opportunity funding by 2025
• Invests $20.6 million to support mental health service units for elementary schools
• Invests millions in Delaware’s higher education institutions including capital improvements, technology upgrades, scholarships, and investments into the Higher Education Economic Development Investment Fund

Supporting Delaware Families

• $1.4 million to support extended post-partum Medicaid coverage
• $1.5 million for the development of a therapeutic foster care program
• Nearly $1 million to support the growth of Delaware Healthy Children Insurance Program (CHIP)
• $3.7 million to support expungement programs

Supporting Delaware’s Workforce

• Investing $88.7 million in compensation and pay equity to move toward a $15 minimum wage for state workers, increase to merit pay scales or 2% pay increase
• Supporting Health Care Workers
  • $500,000 to increase funding for the Health Care provider State loan repayment program
  • $300,000 to permanently fund the mental health services loan forgiveness program
• Supporting Child Care Providers & Workers
  • $11.5 million in increased support for child care providers and workers

Click here to download Governor Carney’s Fiscal Year 2023 budget presentation.

Click here to watch Governor Carney’s virtual budget presentation.

Largest infrastructure plan in Delaware history will invest in roads, schools, clean water, broadband

DOVER, Del. – Governor John Carney on Wednesday signed a $4.7 billion Fiscal Year 2022 operating budget for the State of Delaware, a sustainable financial plan that makes historic investments in Delaware public schools and sets aside $286 million in new savings to prepare for future economic and revenue downturns. 

The operating budget, House Bill 250, includes funding for expansion of Delaware’s Opportunity Funding program to provide additional classroom-based support for low-income students and English learners statewide. By Fiscal Year 2025, funding for the program will more than double to $60 million annually.

Also on Wednesday, Governor Carney signed a $1.3 billion capital budget — the largest capital infrastructure plan in Delaware’s history. Senate Bill 200, the capital budget, includes more than $245 million for school construction statewide and makes significant investments in roads and bridges, farmland preservation, clean water upgrades, economic development, state parks improvements and high-speed broadband expansion in rural communities. 

“This is a sustainable budget that makes investments where they’re needed most, including in our public schools statewide, and prepares us for the future,” said Governor Carney. “We’re also making our largest-ever infrastructure investments, which will create good jobs and attract economic investment across our state. And we worked with legislators to set aside additional reserves to make sure we’re again prepared next time we face a crisis. I want to thank the chairs and members of the Joint Finance and Bond Bill committees for their thoughtful work on this budget in such an unusual year.”

Click here to view the Fiscal Year 2022 operating budget.

Click here to view the Fiscal Year 2022 capital budget.

Click here to view photos from the signing ceremony.

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WILMINGTON, Del. – Governor John Carney on Wednesday issued the following statement on the General Assembly’s passage of the Fiscal Year 2021 operating budget:

“This has been a difficult several months for Delaware, to be sure. I want to start by thanking members of the General Assembly – and especially members of the Joint Finance Committee – for their work under challenging circumstances to pass a responsible, balanced budget. My priorities for the budget have been consistent. Despite significant revenue challenges related to the COVID-19 crisis, we intended to protect critical investments in public education, and to protect the jobs and livelihoods of Delaware’s state workers. This budget will do just that.

We are not laying off state employees, or cutting their benefits. State workers have been on the front lines of this crisis, and we owe them our gratitude. We will also continue investments to support students and educators statewide through our Opportunity Funding program. This program supports students living in poverty, and students who are still learning English. I can’t think of a more important investment in Delaware’s future.

We were only able to continue these important investments because we acted responsibly in good times, and set aside surplus revenue into savings. We should continue to act responsibly. Let’s get the other budget bills done. The grants-in-aid bill provides critical funding for fire companies, senior service organizations, and other critical service providers that Delaware families rely on every day. They deserve our support, especially during this uncertain time. The capital budget makes investments in infrastructure statewide – in school construction, road and bridge improvements, and farmland preservation. Those investments will strengthen our economy and our communities. Let’s move forward.”

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Refunding transaction helps address the State’s budget challenges

WILMINGTON, Del. – The State of Delaware today announced the successful refunding of $33 million of debt at a record low Total Interest Cost of 0.79%. The transaction will save the State $5.2 million in debt service on a net present value basis over the next decade and is structured to further help the State address the Fiscal Year 2021 budget challenges brought on by the COVID-19 emergency.

Three bond rating agencies reaffirmed Delaware’s Triple A rating – Fitch, Moody’s and KRBA – with each taking note of the work of Governor John Carney and the Delaware General Assembly in recent years to boost reserves to prepare for economic downturns. J.P. Morgan Securities LLC served as senior managing underwriter for the transaction.

View rating agencies’ credit reports.

“Delaware continues to receive high marks for fiscal management which allows us to sustain the important investments we’ve made in our schools, our communities and our economy, including efforts to address the impacts of COVID-19,” said Governor John Carney. “The COVID-19 emergency presents enormous financial challenges for every state including Delaware. But I think all Delawareans can be proud of the work we’ve done with the General Assembly to boost the State’s finances prior to this unanticipated event, so our State is better prepared to weather the storm.” 

“This successful transaction shows the market’s confidence in Delaware despite the near-term challenges faced by every state,” said Secretary of Finance Rick Geisenberger. “The competitive pricing and debt service savings achieved for Delaware’s taxpayers speak volumes about our State’s continuing financial strengths.”

“The reaffirmation of the State’s Triple-A bond rating is a huge vote of confidence during these uncertain economic times,” said State Treasurer Colleen Davis. “The State’s best practices including using one-time revenue for one-time expenses, and increasing our reserves, will go a long way to see that we emerge from this crisis maintaining our economic strength.”

KRBA views the financial position of the State as “very strong based on its conservative budgeting policies, comprehensive and timely process of revenue estimation, high levels of financial reserves and strong liquidity. In response to the economic impacts of pandemic, the State has constrained its FY2020 spending and projected expenditures are under budget.”

Moody’s noted that “Delaware’s Aaa rating is supported by its healthy and stable finances and its strong management and governance, all of which enhance the state’s capacity to weather the economic downturn caused by the coronavirus outbreak. The state’s recent growth in reserves provide a cushion in the currently challenged economic environment brought on by the coronavirus pandemic.”

Fitch also noted that “Delaware’s history of exceptional financial resilience and strong budget management may be tested by the depth and duration of this downturn. However, Delaware’s close tracking of both revenues and expenditures and frequent revenue forecasts updates have historically allowed it to quickly respond to changing economic conditions. Fitch anticipates the state will take appropriate action to maintain balance.” 

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Bond refunding saves taxpayers $15 million

WILMINGTON, Del. – Delaware’s proactive fiscal management has been recognized with the announcement of the State’s triple-A bond ratings and an upgrade of the rating for Delaware Transportation Authority (DTA) bonds. The State’s ratings were issued in advance of the refunding of $123 million of Series 2009D Build America Bonds that will save Delaware taxpayers more than $15 million over the next decade. DTA’s ratings were issued as the Authority priced $138 million of new Series 2019 Transportation System Senior Revenue Bonds. Bond ratings reflect an issuer’s financial management policies and practices, ability to make future debt service payments, and economic strength, stability and diversity. Both the State and DTA’s bond issues were priced at interest rates that will result in historically low costs for Delaware taxpayers. 

“Delawareans expect us to responsibly manage taxpayer dollars, and that’s exactly what we’re doing,” said Governor John Carney. “We have an ongoing commitment to ensuring that our fiscal house is in order. These important bond issues and our excellent bond ratings will save us money, and help finance important infrastructure projects like schools and roadway projects all across our state.”

The State’s August refunding refinanced $123 million of outstanding debt through a competitive bid process resulting in a 1.12% all-in borrowing cost — the lowest in modern state history for debt of a similar maturity. The State general fund will realize savings of $1.12 million in the current fiscal year alone. The original bonds financed numerous capital projects including schools, libraries, and other state infrastructure projects.  

“The State’s very successful refinancing reflects a team effort by the Carney Administration, the General Assembly, and our financial and legal advisors,” said Secretary of Finance Rick Geisenberger. “Delaware’s premier bond rating reflects many years of prudent fiscal management and recent efforts to limit operating budget growth, boost reserves during good times, and steer one-time revenues to one-time projects. Our goal continues to be preserving the State’s financial flexibility while ensuring that public borrowing is done responsibly and affordably.”

DTA priced its $138 million of new bonds at a competitive all-in rate of 2.11%. This rate followed the announcement that DTA’s bond rating was upgraded by Moody’s Investor Services from Aa2 to Aa1 while Standard & Poor’s reaffirmed its AA+ rating. Moody’s also upgraded the Authority’s outstanding US 301 Project Revenue Bonds Series 2015 from A1 to Aa3 and its Transportation Infrastructure Finance and Innovation Act (TIFIA) Series 2015 Bonds from A2 to Aa3. The Delaware Department of Transportation’s steady reduction in its overall debt combined with continued positive trends in toll, DMV and motor fuel revenues helps lower the cost of capital and frees up funding to further maintain and improve transportation infrastructure throughout Delaware.    

“We are very pleased with the rating services’ upgrade, and having a strong rating enables the Department to get the most out of every taxpayer dollar,” said Secretary of Transportation Jennifer Cohan. “DelDOT is excited to continue delivering on Delaware’s largest Capital Transportation Program in its history.”

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