Delaware’s projected revenue continues to slide in both the current and upcoming fiscal years according to the latest state revenue forecast.
The Delaware Economic and Financial Advisory Council (DEFAC) estimates another $14.6 million drop for fiscal year 2016 after recording a $45 million dip in March.
Much of that comes from declines in the gross receipts tax and refunds in the corporate income tax.
DEFAC also projects a loss of $7.5 million in the current fiscal year also due to drops in the gross receipts tax.
The picture isn’t any rosier looking further ahead. Officials are facing down a $75 million decline in abandoned property revenue for fiscal year 2017 as well.
Republicans have been calling for a five percent, across the board cut to state spending, which state budget director Ann Visalli takes exception to.
“It’s a little too easy for people to just say, ‘Go cut five percent,’ without providing any specific areas of programs that they would vote for elimination," said Visalli. "I have yet to hear one.”
A group working to restructure Delaware’s revenue system is looking to recommend a revenue neutral solution in the coming weeks.
Finance Secretary Tom Cook says one example that might be modified is the state’s corporate income tax, which currently factors in property values, wages and sales. Cook notes that competing states may only count one or two of those items.
"We have all three factors in Delaware, so to an extent, you might be a little bit penalized for having property here. That’s one evaluation to keep us more competitive,” Cook said.
The committee has tentatively scheduled a final meeting for May 1.
State lawmakers are scheduled to begin crafting their final budget at the end of May.
