Here is a July 1st Report from our Legislative Consultants summarizing the important aspects of the just concluded session of the Delaware General Assembly:
Thank you again to those who joined us last night for another exciting last day of session. It will certainly go down as one of the longest ever. The House gavel did not go down until 5:18a.m. this morning! In that respect, we wanted to share an end-of-session Legislative Brief for the first half of the 148th General Assembly as legislators head back to their districts and we look back over the past six months of session. Having been a very eventful year, there is much to reflect upon as we strategize for the reconvening of the General Assembly in January 2016. Please see the attached bill tracker to see the progress of pieces of legislation that we have been tracking.
Last Day of Session Highlights:
– HB 133 (Sprinklers) passed the Senate at 2:30a.m. 15-0-6 Absent. The Absent votes were the Bond Bill members who called to an emergency hearing. Legislation now heads to Governor for his signature.
– Municipal Street Aid ($5mm) and CTF money ($16mm) were restored last night.
– HB 140, the DMV fees bill that would help generate $25mm for the Transportation Trust Fund passed the Senate last night as part of an overall package that was negotiated with the Senate Republicans. Part of the deal was the passage of HS 1 for HB 145 which increased prevailing wage thresholds for infrastructure projects. Overall, the State is making significant gains on the projected $700mm deficit over 6 years to the TTF.
– The Realty Transfer Tax was restored back to the 1.5% share. The proposed change to 2.0/1.0 would have cut first time home buyer tax credit by a third essentially, but the municipalities and counties were able to fend it off.
The first leg of the 148th General Assembly comes to a close under politically tense circumstances. With more than 500 pieces of legislation, including bills and resolutions, introduced over the past six months, there was plenty of opportunity for controversy, intrigue and political maneuvering. Some of the most talked about issues in Legislative Hall this year included Death Penalty repeal, women’s rights initiatives, education reform, City of Wilmington crime, infrastructure investment, and the dire budgetary challenges facing the State.
Since the Governor made his annual State of the State address in January and presented his recommended budgets to the General Assembly, Representatives and Senators have been working diligently for six months to find a path towards a balanced budget and a replenished capital infrastructure plan. However, as underwhelming revenue forecasts came in, it was clear that the Joint Finance Committee was going to be forced to make some very tough decisions as June 30 got closer.
Most of these decisions, politically, had to be made now as the 2016 election is in sight and judgements like these are best made in the off-year when constituents are seemingly less focused on the Legislature. Leading into the final months of session, the General Assembly considered reclaiming more revenues via the Realty Transfer Tax ($20mm), making significant divestments in the Transportation Trust Fund, rejected the Governor’s plea to cut back on the Senior Citizen Property Tax Credit ($12.6mm) and balked at having State Employee’s cover more of their health benefit’s ($21mm). Without substantive revenue to offset these challenges, June 30th meant the Legislature was potentially facing deep cuts to meaningful programs across the State, including to volunteer fire companies, non-profit agencies, municipal street aid, infrastructure projects and social service programs.
However, as the clock drew closer to midnight and the new fiscal year, leadership in the House and Senate, from both sides of the aisle, found compromise. Deals were brokered on infrastructure investment which will help address the projected $780 million shortfall over the next six years, the budget bill passed both chambers with little contention and the Grant-in-Aid package was restored to it’s original recommendations. However, caution is in order. Because most of the budget holes were filled by one-time mortgage foreclosure settlement money, many of these same problems will creep up again in just a matter of months. As the House adjourned at 5:19a.m. this morning, the State of Delaware is projected to face a $160 million dollar deficit in Fiscal Year 2017.
Fiscal Year 2016 Operating Budget: http://tinyurl.com/pmsyahq
Fiscal Year 2016 Capital Infrastructure Budget (Bond Bill): http://tinyurl.com/p4zxwb7
Fiscal Year 2016 Grants-in-Aid Bill: http://tinyurl.com/noxsces
In anticipation of the final installment of the 148th General Assembly next January, over the next several months we must continue to maintain the strong relationships we have with our allies in the Legislature, educate the ones that could potentially be our supporters in the future and start developing our legislative agenda for 2016.
We have much to be proud of looking back over the past six months. On behalf of Ruggerio Willson & Associates, we look forward to continuing these relationships and increasing our legislative presence as we plan for 2016 this summer and fall.
Rhett, Kim and Jordan