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Revenue boost not enough to cover budget shortfall

Delaware Public Media

A last-minute bump in projected revenue for next year won’t do much to cover Delaware’s budget hole.

The Delaware Economic and Financial Advisory Council or DEFAC tacked on about $27 million for fiscal year 2018.

That still leaves more than $350 million for state lawmakers to cover for next year’s spending plan, according to the Carney Administration.

State budget director Mike Jackson says that’s significant ground to cover.

“We still have needs as a state regarding the Department of Correction, as well as being able to fund our capital improvement plan and we’ll continue to work with legislative leaders on finding an appropriate, long-term solution,” Jackson said.

Gov. John Carney (D) and Democratic lawmakers have called for raising the personal income tax, though Republicans have yet to embrace such an idea.

The plan raises about $68 million next year and $210 million in fiscal year 2019 by bumping up rates for each taxpayer and adding a new income tax bracket for those earning more than $150,000.

The GOP has said they want to study Delaware’s hulking Medicaid program and tie government spending to new benchmarks.

In past interviews, top Democrats have said they could support some of these proposals.

Carney has yet to sign a bill that would hike the corporate franchise tax, earning the general fund $116 million next year.

Staff members at Legislative Hall are openly questioning whether state lawmakers will need a special session to come to a budget agreement.

Jackson is staying optimistic.

“We’re hopeful that we finalize a budget on June 30 as we have for the last 25 years,” he said.

It’s unclear when the Joint Finance Committee will meet to continue molding next year’s spending plan.

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