Gov. Jack Markell signed the $4 billion fiscal year 2014 budget early Monday morning.
“This session’s accomplishments reflect our dedication to ensuring Delaware can compete and win in a fast moving global economy well into the future,” said Markell. “We have made our state an even better place to live, work, raise a family, build a business and retire. With the hard work of our lawmakers, we achieved incredible progress toward providing quality educational opportunities for all of our students, fostering a climate that encourages businesses to expand and create jobs, keeping our residents safe and making Delaware a welcoming place for everyone.”
The budget was not universally praised. A slight upturn in the economy led to more tax revenues, with Republican legislators, who constitute a minority in the General Assembly believing that more could have been done to cut taxes. There were also worries about the economic health of the state’s casinos, a major source of tax revenues. Legislators did agree to an $8 million break for casinos proposed by Markell.
State House Minority Leader Danny Short said Delaware has one of the slowest growing economies in the nation, he said the focus should have been less on social issues and more on improving the state’s business climate and creating jobs. He says with deadlines in the federal Affordable Care Act looming in October, he worries that state did not do enough to help the businesses sector prepare for the challenges they will be facing in the near future.
The governor’s office listed the following highlights:
·Improving the education system with initiatives that increased funding by more than $30 million, raised standards for teacher preparation programs, made it easier for families to choose the school best suited for their children, and brought more accountability to charter schools while supporting high-performing charter schools.
·Boosting the state’s business climate to create jobs by reducing tax rates where possible, particularly on manufacturers, addressing rising workers compensation costs and reforming the unemployment insurance system.
· Ensuring Delaware is a welcoming place for all people by approving marriage equality and ending legal discrimination based on gender identity. The measures had support within the business community.
The Budget Act, Bond and Capital Improvements Act and Grants-in-Aid bills remained aimed at allowing the state to keep its AAA bond rating. The state continues to appropriate 98 percent of our available revenues and maintains a fully funded Rainy Day Fund. The fund has not been tapped, even in the recession year of 2009. A recent forum from the Federal Reserve Bank of Philadelphia said the state’s fiscal policies set it apart from other states in the region.
The budgets included $103 million in minor and major capital public education projects and $12 million in minor and major capital higher education projects
Business highlights include;
·Reforming the Workers Compensation system to address business costs and safety:HB 175 implements recommendations from a task force supported by the Governor and led by Lieutenant Governor Matt Denn after a dramatic increase in premiums the past two years. The bill places tighter controls on workers compensation medical costs, improves the state’s workplace safety program and more effectively encourages injured individuals to return to work.
·Reforming the Unemployment Insurance system: HB 168 shields employers from costly federal tax penalties by making balanced tax and benefit changes, enabling the Unemployment Insurance Trust Fund, which has built up a liability as a result of the recession, to pay off its loan balance by next year.
· Providing $29.2 million to theStrategic Fund in the capital budget. In the past year, the fund has helped several companies expand their business in Delaware with the following plans:
– GE Aviation plans to invest $27 million and add 70 jobs at its 110,000-square-foot facility in Newark as it expands into a LEAN laboratory to support increased production of ceramic matrix composites (CMCs), which are used to make advanced aircraft engine components. The company is committed to staffing 151 people at the Newark site by the end of 2016.
– ILC Dover will bring 115 new jobs to Delawareby moving the manufacturing operations of its recently acquired subsidiary, Grayling Industries, to a new plant in Sussex County. The engineering development and manufacturing firm is known for making spacesuits for NASA, the airbag system for the Mars Rover and Personal Protection Equipment for military, homeland security and industrial users.
– Allen Harim announced its intentions to employ an estimated 700 people and invest $100 million as it expands investment in the United States through the acquisition of the former Pinnacle Foods (Vlasic) processing facility in Millsboro. The remodeled facility will be state of the art for poultry processing, cut-up, and cooking operations.
·Simplified or deleted more than 140 state regulations. The completion of the review by 12 state agencies required by the Governor’s Executive Order 36 in an effort it easier to do business in Delaware, particularly for small companies, make government operations more efficient and make agency rules simpler to use and understand.
·Investing in transportation, infrastructure and quality of life projects, including:
– $45.1 million to supplement the Transportation Trust Fund
– $25.1 million in agency Minor Capital Improvements and Equipment (MCI) and Maintenance and Restoration
– $8 million for Diamond State Port Corporation. WDDE reported the money is being used for a crane. An effort by the Markell administration to lease the port to a private operator failed earlier in the year. Some legislators were unhappy with the plan and the company negotiating the deal walked away citing problems with a union leader. The administration continues to claim the state does not have the money needed to revitalize the port.
– $3 million in statewide trails and pathways
· HB 53 lowers the gross receipt tax rate by 1 percent next year and makes the manufacturing rate still lower.
· HB 89 will allow construction to move forward on a freestanding, inpatient rehabilitation hospital in Middletown, creating 80 jobs.
· SB 47 enables the formation in Delaware of socially-conscious for-profit corporations managed not only for the pecuniary interests of their stockholders, but also for the benefit of other persons, entities, communities or interests.
·HB 16 allows alcohol sales revenues at large events to be shared by license holders, making it more attractive to Red Frog Events to keep Firefly in Delaware.
·$1.0 million to the Division of Vocational Rehabilitation to reduce waiting lists for supported employment.
Also of note: The Sierra Club members were on hand at the final session, apparently worried about rumors over legislation to amend the Coastal Zone Act. The club and the Audubon Society are appealing a decision to allow a rail unloading facility at the Delaware City Refinery, claiming it violates the act. The groups made no legal moves to stop an estimated $100 million that was spent to construct the site.
Click here for the full release regarding gun, education, marriage equality and other areas.
