Delaware State News
DOVER - Gov. Ruth Ann Minner released a record $2.74 billion budget proposal for fiscal year 2006 on Thursday that she said would implement her long-term vision for improving Delaware.
The plan, which would take effect July 1, focuses heavily on education, the economy, the environment and health care, all areas the governor emphasized in her State of the State and inaugural addresses earlier this month.
"My budget will achieve our goals and make a lot of investment," Gov. Minner said of her recommendation, which is 5.5 percent higher than the fiscal 2005 operating budget.
"We will see benefits now, but these benefits will last long into the future."
Though the fiscal proposal would allocate $143 million more than this year's operating budget, Gov. Minner said she had to reject almost $300 million of spending requests from state agencies.
"As a lot of folks will tell you, I looked at these hard, scratched my head, went home, slept on it and came back the next day," the governor said.
"I think this is the very best budget we could propose. If there are changes that need to be made, I am open to them as long they meet the needs of the people of Delaware."
The budget proposal includes funding to increase state employee salaries, bolster the state pension fund, cover higher health care costs, preserve open space and add 11 state troopers, some of whom would staff a proposed truck enforcement unit.
Education, always the largest budget section, accounts for $943.4 million, or 34 percent, of Gov. Minner's operating proposal.
For the Department of Correction, which has been under fire during the past year, Gov. Minner recommended making permanent the 5 percent raise correctional officers received Jan. 1, bumping hazardous duty up by $600 per year and allocating $1.7 million for to-be-determined enhancements to salaries or security.
Gov. Minner's recommendations did not include tax cuts or tax increases.
She described the state's revenue picture as "stable but cautious."
If revenue forecasts increase, the governor said, she would like to fund more projects.
Tax cuts are a possibility, Gov. Minner said, but she wants to be sure reducing revenue now will not send the state into a budget hole in future years.
That approach angered Republicans, who began pushing for tax cuts last year.
After the governor released her proposals Tuesday, House Republicans unveiled their agenda, which included a reduction and eventual elimination of the business gross receipts tax.
"That throws cold water on the business community," Rep. Deborah Hudson, R-Wilmington, said of the governor's stance.
Gov. Minner proposed setting aside a portion of the state's abandoned property revenue to create a Livable Delaware Infrastructure Fund. The general fund would receive $246.5 million every year from abandoned property, with the rest going to the infrastructure account.
Current estimates would give the account $38.5 million in fiscal 2006, which would pay for farmland preservation, water projects, open space preservation, planning and beach preservation.
Gov. Minner proposed a similar idea last year, when she wanted to set aside abandoned property funding into a savings account, but the plan lost momentum when the state began losing gambling revenue to other states.
The gambling threat from Maryland and Pennsylvania has been delayed, Gov. Minner said.
Allocating the abandoned property revenue for one-time projects would make shifting the money into the operating budget to cover lost gambling revenue easier in future years because the state would not be dependent on that money for core services.
The Republicans panned the set-aside plan last year, and House Majority Leader Rep. Wayne A. Smith, R-Wilmington, declared the proposal dead Thursday afternoon.
"Some on our side feel that is an attempt to soak away what should be used for a much-needed and well-deserved tax cut," Rep. Smith said.
For health care, the governor allocated money to fight cancer and combat infant mortality. Increasing health care costs forced the state to increase Medicaid funding by $45.9 million and employee health care by $11.3 million.
"Just like any other business, state government continues to deal with the spiraling cost of health care," the governor said.
Gov. Minner recommended a $631.1 capital budget, also known as the bond bill.
Transportation projects account for $333.3 million of the bond bill, and include efforts such as improving Del. 1 in the beach areas, developing a conceptual plan for a west Dover connector and continuing to build a new Indian River Inlet bridge.
The capital proposal includes $111.5 million for school construction, $13.4 million for a new intermediate care facility at the Stockley Medical Center and $8 million for the Kent County Courthouse.
Besides the pay raise, Gov. Minner also proposed increasing pensions for current retirees by 1 percent and allocated $14 million to help the state's pension fund.
Most state employees would receive a 2 percent or $1,100 raise, whichever is greater, July 1, when the new budget takes effect. Workers making $55,000 or less would see the $1,100.
On Jan. 1, 2006, those employed as of July 1, would receive an increase equal to 2 percent of the middle of their pay range.
"Let me thank my state employees out there for continuing the charge of serving Delaware well," Gov. Minner said.
"They have done an outstanding job over the last four years, and I look forward to working with them for the next four."
Cabinet secretaries and General Assembly members would see a 2 percent pay increase July 1 and nothing else. Public education employees, higher education employees and those on the special attorney and natural resources pay plans would also see the 2 percent increase but not the January hike.
The pay proposal and all of Gov. Minner's recommendations will be considered by the legislative Joint Finance Committee. The panel will craft a final version of the state budget, which the legislature will pass in late June. The Joint Bond Bill Committee will consider Gov. Minner's capital budget proposal.
"It's a good place to start," JFC co-chair Rep. Joseph G. DiPinto, R-Wilmington, said about the proposed pay raise.
"The governor never puts in the full amount you are going to get. We have to decide if we can justify the full amount or if we can justify more. That's what we'll be doing between now and June."
Staff writer Joe Rogalsky can be reached at 741-8226 or jrogalsky@newszap.com.
Reprinted with permisson from newszap.com
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