Governor Carney Signs Executive Order on Budget Smoothing

Action will create benchmark budgeting mechanism and promote fiscal sustainability

DOVER, Del. – Governor John Carney on Saturday signed Executive Order 21 to implement recommendations of the advisory panel to DEFAC to study potential fiscal controls and budget smoothing mechanisms. The Order will create a benchmark budgeting mechanism, and a Budget Stabilization Fund for budget planning, to help the State of Delaware take a more sustainable, long-term approach to annual budgeting.

Governor Carney and Michael Houghton, Chair of the Delaware Economic and Financial Advisory Council, issued the following statements on the Order following Saturday’s signing:

“Over the past several decades, we’ve seen Delaware’s budget go through good times and bad times,” said Governor Carney. “As every Delaware family knows, you’re supposed to save some of your money during the good times so you can make it through when money gets tight. This Executive Order holds state government to the same standard. It’ll even things out so when a bad economy comes along, we won’t see massive cuts in services or dramatic tax hikes. This is the responsible thing to do for taxpayers who rightly expect us to manage their money wisely.”

“I’m disappointed that we were not able to structurally improve the budget process like our committee recommended. It would have made life more predictable for nonprofits, fire companies and others relying on State funds and avoided the unhealthy ‘feast or famine’ fiscal cycle we are seeing,” said Michael Houghton, Chair of the Delaware Economic and Financial Advisory Council. “As Chair of the Advisory Panel that recommended the changes to the General Assembly, I want to thank Governor Carney for stepping up and initiating changes that more responsibly align State spending with revenues through his Executive Order.”

Learn more about the Executive Order on budget smoothing

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Governor Carney Signs Fiscal Year 2019 Budget and Supplemental Appropriation

Cements $4.2 billion state budget with $49 million supplemental appropriation for one-time bonuses

DOVER, Del. – On Thursday, Governor John Carney signed Senate Bill 235 – the Fiscal Year 2019 Appropriation Act. This budget, which received final passage by the General Assembly this week, provides a balanced $4.2 billion financial plan that makes investments in Delaware’s economy, workforce and public schools.

The supplemental budget, Senate Bill 236, passed today in the Delaware House, appropriates funds to provide a $500 one-time salary supplement to full-time and part-time employees, as well as supplements to pensioners and one-time funded priority projects.

“When we presented our budget proposal in January, we were focused on making responsible decisions, using one-time revenue for one-time investments, and helping keep our state competitive. The budget I signed today accomplishes those goals,” said Governor Carney. “This is a responsible budget that will invest in our highest-needs schools, and help us recruit and retain teachers where they’re needed most. We are making new investments to confront the opioid crisis, and giving state employees a well-deserved raise. I want to thank members of the Joint Finance Committee and the entire General Assembly for their efficient work on this budget, and for making responsible decisions that will help us continue to address our long-term, structural challenges.”

“This year’s budget process was unlike any other in my 42 years in government and should serve as an example for subsequent General Assemblies,” said Harris McDowell, co-chair of the Joint Finance Committee. “The surplus has been headline news since late last year – and rightly so – but this year was also defined by a spirit of cooperation and an attention to detail that should make all Delawareans proud. Thanks to the diligent work of the Joint Finance Committee, we completed this budget in record time and passed a final version that faithfully mirrors the priorities and values of this state. It is responsible, sensible, and fair and I want to once again thank my colleagues on the Joint Finance Committee, co-chair Melanie George Smith, and all of our elected officials that worked so hard to get us across the finish line today.”

“My colleagues on the Joint Finance Committee worked hard in a bipartisan fashion to ensure that we used the taxpayers’ dollars in a fiscally responsible way,” said Representative Melanie George Smith, co-chair of the Joint Finance Committee. “We have been able to meet our core obligations and provide vital services that Delawareans rely on, while restoring funding we were forced to cut in more difficult years and putting funds in reserve for future years. This spending plan is a testament to responsible budgeting.”

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Highlights of the Fiscal Year 2019 Budget:

RESPONSIBLE INVESTMENT

Limits operating budget growth to 3.99%
Sets aside over $46 million by only appropriating 97% of available revenue
Funds long-term liabilities such as pensions and debt service
Funds “door openers” such as:
- $20.9 million for school enrollment growth
- $8.8 million for quality child care for more children
- $3.0 million to ensure fair elections
Generates over $5 million in savings in areas such as energy, fleet services and restructuring of the Department of Education

BETTER SCHOOLS FOR ALL DELAWARE CHILDREN

Investing in Educators

$10.2 million for annual salary step, plus a 2% general salary increase for educators statewide

Investing in Early Education

$3.8 million to fund growth in Delaware’s early learning centers through the STARS program

Investing in High-Needs Schools

$6.0 million to expand the Opportunity Grants program, with targeted investments into schools with high percentages of students at the poverty level and/or English Language Learners (ELL) students

Investing in the City of Wilmington

$1.5 million for the Christina School District schools located in the City of Wilmington

INVESTING IN OUR WORKFORCE

Investing in State Workers and Educators:

$1,000 annual raise for state workers
2% raise for teachers statewide, on top of annual step increases
$500 one-time bonus for all state employees
$400 one-time supplement for all retirees

High Needs Area – Public Safety:

Funding for second year of correctional officer raises to $43,000 starting salary
$3.6 million for implementation of correctional officer career ladder
$2.3 million to fund implementation of the Department of Correction Independent Review recommendations
Establishment of a dedicated Special Operations Response Team (SORT) unit in the Department of Safety and Homeland Security.

High Needs Area – Children’s Services:

$4.2 million to add 30 new casework staff and contractual support in the Division of Family Services to bolster child welfare, abuse and neglect hotline investigations
$2.0 million to add 29 new staff members in the Division of Youth Rehabilitative services to meet staffing needs in six secure facilities, and reduce mandatory overtime

A HEALTHIER DELAWARE

Investments toward improving Delawareans’ health:

$1.4 million to expand substance abuse treatment
$3 million to implement recommendations of the Behavioral Health Consortium Report
$4.6 million for contractual increases for provider partners providing services to those with disabilities
$285,000 to expand resources for substance-exposed infants
$2.0 million in prescription assistance for Delaware seniors and $850,000 to support Senior Nutrition Services

Governor Carney’s Statement on Budget Smoothing Constitutional Amendment

DOVER, Del. – Governor John Carney on Tuesday issued the following statement on House Bill 460, which would implement recommendations of the Advisory Panel on Potential Fiscal Controls and Budget Smoothing Mechanisms:

“Delaware has a long tradition of fiscal responsibility. We’ve been focused since taking office on addressing our long-term challenges, on responsibly investing one-time revenue, and on making sure we don’t spend beyond our means. This will require a long-term commitment, and this constitutional amendment will help ensure our commitment to making responsible, long-term decisions about our finances.”

Learn more about the budget smoothing proposal.

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Governor Carney, JFC Co-Chairs Release Statements on DEFAC Estimates

Governor Carney’s Statement on Budget Smoothing Report

Governor Carney Presents Fiscal Year 2019 Recommended Budget

Governor Carney’s Statement on Budget Smoothing Report

WILMINGTON, Del. – Governor John Carney on Tuesday issued the following statement on the Executive Summary of the Advisory Panel to DEFAC on Potential Fiscal Controls and Budget Smoothing:

“We do not face a budget deficit this year but, as a state, we cannot lose sight of our long-term financial challenges. Working with members of the General Assembly last year, we asked this advisory panel to study and recommend ways to improve our fiscal controls to address our structural spending and revenue challenges. I want to recognize and thank the panel’s chair, Mike Houghton, and all of the panel’s members for their important work.

This is a long-term challenge that will require a long-term commitment. We cannot continue to appropriate into a bubble, only to cut our way out in years where our revenue growth does not match spending needs. We’re already focused this year on limiting spending growth, on directing one-time revenue into one-time investments, and on making sure we don’t spend beyond our means.

Over the long term, fixing this problem will require us to more closely align spending and revenue policies with sustainable levels of economic growth. We should finally commit to addressing our budget problems so we can get back to making investments that matter – in our schools, our communities, and our economy. I look forward to discussing the panel’s recommendations with members of the General Assembly of both parties.”

Governor Carney signed House Joint Resolution 8 in August 2017, creating the advisory panel to study fiscal control measures.

Click here for more information about the advisory panel and its work.

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Governor Carney Presents Fiscal Year 2019 Recommended Budget

“Responsible Investment” plan advances priorities outlined in State of the State including public education, state workforce

DOVER, Del. – Governor Carney on Thursday presented his Fiscal Year 2019 Recommended Budget, sending the General Assembly a balanced $4.2 billion financial plan that will make important investments in Delaware’s economy, workforce, and public schools – while ensuring budget sustainability.

Governor Carney’s “Responsible Investment” proposal limits budget growth to 3.49 percent and allocates $100 million of surplus, one-time revenue into one-time investments in the capital budget.

“We are proposing responsible investments while keeping an eye on Delaware’s future,” said Governor Carney. “These proposals will help make our economy more competitive, prepare all Delaware children to succeed, bolster our workforce, and strengthen communities across our state. Importantly, this plan will limit operating budget growth, and ensure that we invest responsibly, in ways that can be sustained. I look forward to discussing this plan, and how it will move our state forward, with members of the General Assembly and with Delawareans across our state.”

“This budget allows us to continue working toward long-term financial sustainability for our state, limiting operating budget growth to 3.49 percent,” said Mike Jackson, Director of the Office of Management and Budget. “It makes fundamental investments in areas of need by allocating $100 million in surplus revenues into one-time investments in the Bond Bill. This is a responsible budget that will keep Delaware on the right track.”

Key portions of Governor Carney’s financial plan:

Financial Sustainability
Limits operating budget growth to 3.49 percent

Savings in areas such as energy, fleet services and restructuring of the Department of Education

Restores $20 million of earmarked revenue for farmland preservation and open space

Funds long-term liabilities such as pensions and debt service

Funds “door openers” such as:
• $20.9 million for school enrollment growth
• $8.8 million for quality child care for more children
• $7.1 million for school transportation
• $3.0 million for fair and efficient elections open to all qualified voters

Continues a commitment to identify efficiencies and long-term cost savings through the Government Efficiency & Accountability Review (GEAR) Board

Better Schools for All Delaware Students

$10.2 million for annual salary steps for educators

2 percent salary increase for educators statewide

$3.8 million to fund growth in Delaware’s early learning centers through the STARS program

$6.0 million for Opportunity Grants – non-competitive funding for Delaware public schools with large populations of low-income students and English language learners

$1.5 million for five Christina School District schools located in the City of Wilmington for school-based wellness centers and professional development for educators

$15 million in capital investments to modernize Wilmington schools in the Christina School District to enhance the learning environment and educational experience in these facilities

Investing in Our People

$1,000 raise for state workers

$7.8 million for one-time investments to fund capital improvements in state offices including $2.8 million for Carvel office upgrades

Support for 12 weeks of paid parental leave for all state workers

Department of Correction:

Funding for second year of correctional officer raises to $43,000 starting salary
$3.6 million for implementation of correctional officer career ladder
Over $4 million to fund implementation of Independent Review recommendations

Department of Services for Children, Youth and Their Families:

$2.6 million to add 30 new casework staff in the Division of Family Services to bolster child welfare, abuse and neglect hotline investigations
$2 million to add 29 new staff members in the Division of Youth Rehabilitative services to meet staffing needs in six secure facilities, and reduce mandatory overtime

A Healthier Delaware
$1.4 million for additional resources toward substance abuse treatment

$285,000 of resources for substance-exposed infants

$2 million in prescription assistance for Delaware seniors

Delaware Reinvest
Turning surplus revenues into one-time investments in the Bond Bill in a package called Delaware Reinvest:

Economic Development: Funding for the Delaware Strategic Fund, the Delaware Prosperity Partnership, research collaboration, new funding for capital upgrades at Delaware Tech, Delaware State University, and the University of Delaware, and funding for roadway infrastructure upgrades statewide
Environment: Funding for open space and farmland preservation, clean water/drinking water investments and shoreline and waterway management
Strong Communities: Funding for affordable housing subsidies, Downtown Development District investments, library upgrades, and school construction

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