Carney: Budget to offer ‘shared sacrifice’ — Governor, legislators detail issues at Chamber luncheon

DOVER — Even Gov. John Carney admits his budget proposal will be unpopular — “the best bad budget you’ve ever seen,” he said Wednesday.

The governor made the remark at the annual Central Delaware Chamber of Commerce Legislative Luncheon, an event that brings together myriad businesses throughout Kent County and gives them a chance to hear what state lawmakers think of several pressing issues.

Gov. Carney spoke for just under 20 minutes Wednesday, offering hints at what his budget will look like — “shared sacrifice” based on a mix of cuts and taxes — although his comments echo remarks he’s made many times over the past two months. His proposal will be released this afternoon.

Lawmakers weighed in on the budget, minimum wage, right-to-work, taxation and the Affordable Care Act, mostly taking stances aligning with their party ideologies, with the crowd greeting some responses with hearty applause.

Legislators spoke of spending smarter to counter a projected budget gap of $386 million.

Gov. John Carney discusses the upcoming state budget during the 15th annual Legislative Luncheon at the Rollins Center in Dover on Wednesday. (Delaware State News/Marc Clery)

“Look at where the money’s going and what you, the taxpayer, are getting,” Sen. Dave Lawson, R-Marydel, said.

Several speakers said they were willing to consider raising taxes but cautioned the state should ensure waste is eliminated and money is going to effective programs first.

Rep. Trey Paradee, D-Cheswold, suggested adding a new top tax bracket. Currently, the highest tax bracket is $60,000, with all income above that being taxed at 6.6 percent.

Chatting from left, Glen Howell with Kent County Levy Court, Dover Mayor Robin Christiansen and Allan Angel with Kent County Levy Court.

Proposals floating around Legislative Hall would create new levels of $125,000 and $250,000, with rates of either 7.05 or 7.1 percent for the former and 7.8 or 7.85 for the latter.

Part of the state’s budget shortfall is due to rapidly growing state employee health care costs, a key focus of the prior administration.

Rep. Lyndon Yearick, R-Camden, said shifting some costs to workers will encourage them to be smarter consumers, utilizing health care only when it is necessary — in turn saving the state millions.

Jim Waddington, left, with Kent County Economic Development talks to newly elected Levy Court District 2 Commissioner Jim Hosfelt.

“If we get more skin in the game, they’ll have a greater appreciation of value of services,” he said.

He also advocated for broadening the tax base to cover more people, such as apartment renters, who do not directly pay property taxes.

Former Gov. Jack Markell’s proposed budget released in January would have shifted tens of millions in costs to the counties, municipalities and local school districts, a recommendation that was met with swift reaction from local officials.

Sen. Brian Bushweller, D-Dover, said Wednesday he would fight any attempt to balance the budget by placing a greater burden on local governments.

Although Gov. Carney did offer some optimism, Delaware’s grim budget picture could get worse: If Congress repeals the Affordable Care Act, the state would have to either come up with about $120 million or kick 10,000 people off Medicaid.

The U.S. House of Representatives will vote on a Republican replacement today, but some GOP lawmakers have said there are not enough supporters for it to pass.

Deborah Whidden with the Delaware State Housing Association hands out a brochure.

The legislators at the luncheon Wednesday cautioned they are unsure of what will happen, although Rep. Charles Postles, R-Milford, predicted it will be “painful” for Delaware.

“It’s a really bad roller coaster and you just have to hold on,” Rep. Jeff Spiegelman, R-Clayton, said.

At the local level, many members of the Central Delaware Chamber are warily eyeing a bill that would raise the minimum wage to $10.25 in four 50-cent increments and afterward tie it to inflation. The bill was released to the Senate floor from a committee Wednesday.

The four Republican lawmakers in attendance are opposed to the raise, which they said represents government overreach and will lead to more automation.

With Sen. Bushweller undecided on the increase, Rep. Paradee was the only supporter among the legislators present at the luncheon. He cited research showing wage growth among lower-income Americans has been stagnant for years, while those as the top of the scale are making more.

Sen. Brian Bushweller answers a question about minimum wage.

“We as a state, we as a society, are being forced to provide food stamps … Medicaid, other social programs, so whether we like it or not, all of us in this room are good tax-paying Delawareans, we are helping to subsidize and support these folks,” he said.

The two Democrats also differed with their colleagues on right-to-work laws, which prohibit workers from being compelled to join a union.

Sen. Bushweller said right-to-work is intended to lead to the “destruction of the union movement,” while Rep. Yearick defended the laws as a “tool in the toolbox” for the state to attract businesses.

Gov. Carney supports raising the minimum wage and is against making Delaware a right-to-work state.

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