The state’s most recent sagging revenue estimates were just the latest fiscal issue capturing headlines and demanding the attention of the General Assembly and the Markell administration.
Compared to the estimates made in April, the Delaware Financial Advisory Council now predicts state revenue will further decline $14 million in the current fiscal year. In the fiscal year beginning July 1, the state will have $19.2 million less to spend.
That reality will require state agencies to trim expenses, while challenging legislative budget writers to craft the mandated balanced spending plan.
Meanwhile, Gov. Markell has made two controversial financial proposals. The first would raise the state tax on gasoline by more than 43 percent while borrowing an additional $250 million over five years as part of a plan to generate money for road and bridge projects. The second would impose a new fee on property owners to finance a sweeping water improvement initiative.
This is not the first time our state has faced difficult decisions under trying circumstances. The Great Recession hit Delaware hard, leaving state revenues (which are heavily dependent on economic activity) in free fall.
To enact a balanced Fiscal Year 2009 budget, the legislature and Minner administration had to close a deficit estimated at nearly $139 million.
The following year was even worse as the national economy continued to tank. In the first year of the Markell administration, the gap between expected state revenue and projected spending was nearly $800 million - arguably the most dire budgetary situation Delaware has ever confronted.
Through months of hard work and negotiations, we were able to cobble together a package to meet that challenge. We enacted an FY 2010 state budget that was $256.3 million less than the one it replaced - a reduction of 7.65 percent.
Key to this success was the work of the so-called “Big Head Committee”: an informal group consisting of the leadership of the General Assembly’s four political caucuses and top members of the governor’s staff.
Through the first half of 2009, this group met regularly to discuss budgetary and fiscal issues, propose solutions, and find common ground. We often differed and the meetings were sometimes heated and uncomfortable, but it was through the conflict sparked by this diversity of thought that we arrived at a creative consensus.
Some may mischaracterize this process as decision-making behind closed doors. Rather, it was the birthing process for ideas that were further shaped - and many times rejected - as they were publicly debated. The active give-and-take that arises and the organic process of having all parties sitting at one table to negotiate in good faith has vanished and our state is not well-served by its absence.
Despite the success, 2009 was the last time the bipartisan fiscal committee met. Since then, Gov. Markell and House and Senate Democrats - which have super-majorities in both General Assembly chambers and control eight of the 12 seats on the budget-writing Joint Finance Committee - have kept their own counsel on budgetary issues.
Some will read this with a jaundiced eye, dismissing it is the dissatisfied grumbling of a political party that has lost its ability to effectively influence public policy. That disparaging analysis would be shortsighted.
Consider that the last time true bipartisan fiscal talks were held, the budget shrunk to $3.09 billion. The governor’s proposed budget for upcoming FY 2015 is $3.829 billion. That is an increase of nearly 24 percent, or $739 million, over the five-year period.
Republicans are Republicans because our public policy decisions are informed by a unique ideology that differs from Democrats and others. The perspective that we bring to the table forces consideration of concepts and suggestions that would otherwise be missing from the debate.
In fact, it was just such a process that in 2009 led House and Senate Republicans to champion a proposal to reduce the state force work force by more than 500 workers through attrition. Reluctant to embrace the idea at the time, Gov. Markell now often cites that reduction as one of the top successes of his tenure in office.
Democrats hold all the cards in our state legislative process and have more than enough votes to pass tax increases, increase spending and otherwise make law and policy without any Republican input.
The Democratic Party identifies the need to embrace diversity as one of their core doctrines. We would respectfully suggest that now is the time to put that worthy principle into practice by taking the pragmatic course of re-establishing bipartisan fiscal negotiations and arriving at a consensus that mutually reflects the wishes all Delawareans, including the one-third of citizens that are represented by Republican state lawmakers.
State Rep. Danny Short, Seaford, and State Rep. Deborah Hudson, New Castle County
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