Too many cuts stall Delaware budget meetings

Top legislative leaders asked the Joint Finance Committee on Wednesday to halt the process of writing the state budget, saying cuts the committee was proposing were concerning too many constituents.

Speaker of the House Pete Schwartzkopf and Sen. David McBride, both Democrats, said the committee should resume once Democratic and Republican leadership come to an agreement on how much money to raise through tax increases.

"We heard loud and clear from legislators, community stakeholders and affected residents about these potential cuts," the pair said in a joint statement. "For that reason, we have asked JFC to take a step back and give legislative leaders the opportunity to meet and see if there is room for compromise to raise additional revenue so that we can balance any cuts we might have to the budget."  

The clock is ticking — the General Assembly must pass a balanced budget by June 30.

Over the past two weeks, the committee has voted on about $80 million in cuts. Among them: trimming a property tax break for senior citizens from $500 to $400; a 20 percent reduction in public health programs for things like infant mortality, nursing partnerships and needle exchange programs; and $2 million slashed from early childhood initiatives.

Schwartzkopf said both Democratic and Republican lawmakers started getting phone calls from constituents who would be affected by some of those cuts.

"Basically, we're hurting people," Schwartzkopf said. "We are cutting services to people who need them the most."

Schwartzkopf said he, McBride and JFC chairs decided they didn't want to begin making cuts that could be reversed if legislative leaders agree to more revenue. 

"We don't want to overly alarm people," said Sen. Harris McDowell, the committee's co-chair.

Lawmakers are grappling with a $400 million budget shortfall this year. Gov. John Carney has proposed fixing the problem with about $200 million in spending cuts and $200 million in tax increases.

The General Assembly has reached an agreement only on the corporate franchise tax, which would raise about $119 million. Democratic and Republican leaders have not reached an agreement on other tax increases Carney proposed, such as the personal income tax and tobacco tax. 

BACKSTORY:Read more on the tax deal that is already in the works

So when the 12-member finance committee started meetings to write the budget last week, its members were not sure whether they would need to cut the $200 million Carney called for or cut more than $280 million. 

The full House and Senate have to vote on JFC's budget before it becomes law, but changes are rare.

Some committee members — including its chair, Rep. Melanie George Smith, D-Bear — have worried about pushing votes on tough cuts too far back into the session, fearing that could cause a mad dash in the last hours of the session.

Two years ago, the General Assembly approved a budget in the wee hours of the morning on July 1. 

Rep. Mike Ramone, R-Middle Run Valley, said he was "confused" as to why JFC had stopped meeting. He points out that the committee hasn't settled on a budget that met Carney's proposed level of cuts, let alone the cuts it would have to make if no further taxes pass.

"I'm not trying to speak ill of anybody, but we're not even at $200 million yet. We're at $80 [million]," Ramone said. "Our government has a lot of places we can cut expenses. I think the discussion we have been having is healthy." 

The committee's co-chairs said there are other reductions on the table that haven't been voted on yet. For example, lawmakers will likely not provide any extra cash to the "bond bill" that pays for infrastructure projects.

And the committee has yet to seriously debate Carney's proposals to ask state employees to contribute more to their health insurance or to cut discretionary state funding to schools. 

Sen. Dave Lawson, R-Marydel, said he thinks it's OK for JFC to wait for leadership to settle on the big budget picture, saying it could avoid "a lot of wasted time."

But he said lawmakers need to be serious about cutting the budget instead of just asking for more tax increases.

"We can't go back to our employer and say 'oh we overspent,' and that's what we do to the taxpayer," Lawson said. "Government is addicted to green." 

Contact Matthew Albright at malbright@delawareonline.com, (302) 324-2428 or on Twitter @TNJ_malbright.