Delaware revenue estimate takes nosedive

Delaware revenues are falling far short and could fall more than a half a billion dollars behind by 2010.

The sluggish economy and significant reductions in state and personal income taxes, along with lower corporate franchise and real estate transfer taxes account for the drawdown, said Robert Scogletti, director of policy and external affairs at the state’s Office of Management and Budget.

“Given the economy, much of the revenue base has been trending downward,” Scogletti said, noting current revenue estimates are $585 million less than previously forecast.

Gov. Ruth Ann Minner has asked leaders of the more than 20 state agencies to cut their budgets by 7 percent for fiscal year 2009 and by 15 percent for fiscal year 2010.

In September, the Delaware Economic and Financial Advisory Council (DEFAC) reduced earlier revenue estimates by $38 million for fiscal year 2009 and $92 million for fiscal year 2010.

A week ago, officials further reduced revenue by an additional $152 for 2009 and an additional $304 million for 2010.

“They’ve taken well over half a billion dollars for the two-year period,” Scogletti said.

He also said it is too early to predict how services might be affected.

“This is an issue that will take a full year to resolve, but something this governor said we need to address right now,” Scogletti said.

Scogletti said both Minner and Markell have pledged to work together to tackle the deficit and stalled economy.

“The only things specifically identifiable in the budget for Sussex County are school projects,” Scogletti.

Minner has pledged not cut services and to combine some programs.

The next DEFAC meeting is Monday, Dec. 15, when officials will review expenditures.