Finished budget includes 1.5 percent pay raise for state workers



DOVER — State employees are on track to receive the biggest pay raise they’ve seen in five years after the Joint Finance Committee approved a salary increase Thursday. Employees will earn an extra 1.5 percent or $750 — whichever is greater.

The thousands of Delaware workers will get the raise starting Oct. 1 should the budget as it is currently configured pass the full General Assembly later this month, which is extremely likely.

After Thursday, lawmakers have completed most of the spending plan for the fiscal year starting July 1. The operating budget itself will not be touched going forward, Joint Finance Committee co-chair Rep. Melanie George Smith, D-Bear, stressed.

Legislation providing funding for nonprofits and construction projects will be created later this month by JFC and the Joint Committee on Capital Improvement, respectively.

Nonprofit funding, known as grant-in-aid, received $43 million in the last budget and was recommended by Gov. Jack Markell to get the same amount, but it will see cuts, the JFC co-chairs said, although the exact amount remains to be determined. JFC also intends to move some leftover cash to the bond bill.

Legislators currently have $45.2 million remaining, although that figure could change — in either direction — based on this month’s revenue forecast.

Thursday marked the fifth and final day of budget markup, and lawmakers did not wrap up until shortly before 9 p.m., ending a long and drama-filled meeting.

The employee pay raise announced on the last day of markup came as somewhat of a surprise, given lawmakers have repeatedly emphasized the budget challenges facing the state. It also surpasses the 1 percent or $500 increase Gov. Markell suggested in his January budget proposal.

Delaware employees received a $500 last calendar year, spread out in two installments. They previously earned a 1 percent raise in the fiscal year that began July 1, 2012, and a 2 percent raise for the period starting one year earlier.

“We’re recognizing with this pay raise the fact that we know we’re asking state employees to do more because there’s fewer of them,” Rep. George Smith said. The state is down more than 1,100 positions since Gov. Markell took office in January 2009.

Employees who are part of collective-bargaining agreements, such as state police and correctional officers, are not eligible for the pay raise. Workers who receive annual step increases, such as teachers, will get those starting July 1.

That was not the only good news for some state employees Thursday: A proposal to eliminate a system that provides low premiums for married couples who both work for Delaware is likely stalled, Rep. George Smith said.

Meanwhile, a plan to lock all future employees into a Health Savings Account, which would save money for the state, also has little support.

Both ideas were centerpieces of Gov. Markell’s budget proposal.

After eliminating funding for rental assistance, drug treatment and low-income family housing Wednesday, lawmakers walked back the cuts using previously allocated settlement money.

JFC approve a plan in December to spend $8 million on reading and after-school programs, but legislators voted to move that money to other areas Thursday.

The co-chairs of the committee both said Wednesday slashing the drug treatment initiative was the hardest cut for them. One-time money will ensure it is funded for next year, although at a lower level than recommended by Gov. Markell.

Debates on giving money to pensioners and education funding, particularly involving higher-education institutes, consumed a good deal of time, as did a surprise proposal that would have had the state step in and forcibly solve a dispute between UnitedHealthcare and Nemours/Alfred I. duPont Hospital for Children and Nemours duPont Pediatrics.

United canceled its contract with Nemours two years ago, and the dispute has lingered since, meaning Delawareans who have coverage with United through Medicaid have to travel farther for pediatric care.

The language introduced Thursday would have forced United to provide coverage at Nemours.

The idea was rejected by committee members, who said they needed more time to digest the idea.

“The state is interfering with private contractual enterprises,” Sen. Brian Bushweller, D-Dover, said.

The proposal could be brought back later.

Lawmakers also approved a 3.3 percent raise for school bus contractors and $9.4 million in new spending for early childhood initiatives.

Six million dollars for Wilmington school redistricting remains off to the side for now. Should the legislation to approve that goal fail in the full General Assembly, that $6 million would be freed up for grant-in-aid and the bond bill.

The legislature will be in session for the entire month of June starting Tuesday.

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