Thursday, July 2, 2009

Choice to Cut School Construction

In the coming days examination of the budget bill and bonding bill will reveal a more complete picture of the year to come. Also, it is difficult to reach people today in Dover to have questions answered; probably a combination of exhaustion and people leaving for the holiday.

One thing we do know is that with the failure of the beer and wine tax the Bond Committee was reconvened Tuesday night and approximately $4.8 million came out of school construction.

In the political spin that will follow this act one will surely hear, 'we had to make up the money in the budget once the alcohol tax failed to pass'. One thing should be clear. Going specifically after school construction was a choice among many. It was a choice that will ultimately impact kids, school employees, and construction workers desperately needing employment at this time.

With two minutes of thought I could tell the legislature and administration what they could have done when it became obvious they did not have the votes for the beer and wine bill. First, in the corporate fees bill the fee for an LLC could have been raised eight dollars a year from $200 to $208. The money could have come from the Rainy Day Fund which at the required 2% of revenue is now over-funded with the drop in revenue. The money could have come from the so called Strategic Fund. This fund has over $40 million for economic development projects and had $9 million added to it in this lean year. This fund is often used to entice corporations to come to Delaware. When it's a single mom trying to survive and she needs public assistance we derisively call it welfare. When it's a corporation we call it development.

We will need to rethink many things in Delaware about what is legitimate state investment, what is sustainable revenue, and what is real wealth. One thing is for sure these issues will be front and center for the 2011 Budget because the opportunity was missed in the 2010 Budget to reform Delaware's tax system and economic recovery seems distant.

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