ISSUES AND ANSWERS ON STATE SPENDING: Reforms needed to increase Delaware spending

Sen. Harris B. McDowell III, a Democrat, represents the 1st District in the Delaware General Assembly.

How much should the state be spending?

The question shouldn’t be how much, but how well. We need to ensure that we’re investing sufficiently in programs and services that help us secure a strong future and that our budget reflects those priorities and the results that we expect.

What can realistically be done to cut spending?

Senator Harris McDowell by The News Journal/BOB HERBERT.

Harris McDowell III

First, we can continue to seek out new efficiencies through the General Assembly’s oversight and budgeting responsibilities, whether through consolidations, elimination of duplicative programs, or other common-sense measures.

Second, we can incentivize state agencies to improve productivity by offering a mechanism to recapture a portion of productivity increases as pay raises. Third, and perhaps most significantly, we can take steps today to contain growth in one of the largest and parts of our budget: our criminal justice system, where we spend more than $30,000 per year to house just one prisoner.

How can we lower Medicaid costs?

I’m closely watching the Department of Health and Social Service’s work on this front. There’s also national and statewide discussion around the opportunity to adopt reforms that pay for health care outcomes, rather than the number of services provided, and I think that discussion is worth serious attention in Delaware. With that said, Delaware can only do so much on its own — we are, to some extent, relying on the budgeteers in D.C. to steer broader reform and cost containment.

Should Delaware create a “budget-smoothing” fund?

On the surface, a budget smoothing fund sounds nice, but I have a number of serious questions and concerns surrounding implementation. Chief among them is that creating a second Rainy Day Fund might siphon funds away from critical services that are of non-negotiable importance to working families, children, and seniors. I also think that a successful stabilization fund would need to be administered independently, rather than by a vote of the legislature. Crucial funding for schools and health care should not be decided by brinksmanship and political convenience.

Should the state make efforts to increase revenue? If so, how?

There is bipartisan agreement that Delaware should reform its revenue portfolio so that it grows with the economy, and our work there remains unfinished. I believe that many of the revenue measures suggested last year still warrant serious consideration. But aside from them I also think we need to recalibrate our subsidies to the counties and ask local governments to do what’s necessary to cover local services.

Are Delawareans getting the best value out of their tax dollars?

We can always get better value out of our tax dollars, and part of our job is to ensure that we’re always improving. We can begin by making long-overdue reforms to our criminal justice and education systems and asking state government to do more with the money it has.

But lower short-term spending isn’t always the key to better value. In some cases, the best way to get the most out of our money is to spend more now so that we can save more today. For instance, we need to recognize the beginning of a trend that I call “brain drain”: state government can’t retain its best and brightest employees because their compensation is often well below what they could earn in the private sector.

If we’re going to have a serious conversation about things like “value,” “efficiency,” and “productivity,” then we need to retain the employees who have the agency to implement those reforms.

For another view from Sen. F. Gary Simpson, click here.

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