The First State’s revenue forecast still looks good, but gains are slowing coming out of the pandemic.
The Delaware Economic and Financial Advisory Council’s (DEFAC) final estimate for the current budget cycle adds another $71.5 million to the state’s bottom line.
DEFAC bumped revenues for the current fiscal year up about $93 million from its May outlook, but dropped them by $27 million for 2022.
State financial analyst David Roose says the revenue increase this fiscal year is in part fueled by personal income tax payments arriving earlier after a huge delay last year.
“Over $185 million, about $185 million dollars, far in excess of anything we have seen in the past,” he said.
Roose says workers may have withheld less money on their paychecks over the past year - fearing a recession. When it failed to materialize, a gap was created between what people withheld and what they owed.
DEFAC also dropped expenditures by about $40 million.
Budget developer Cali Engelseipen says use of grant funding is part of the reason for the decreased spending.
“Our expenditures just haven’t materialized as much as we thought they would these last couple of months,” Engelseipen said. “Could be availability issues are part of the problem, services and materials that are impacting this.”
She notes many projects planned this year got pushed to next fiscal year.
DEFAC’s final forecast for this budget cycle comes the same day the state’s 2022 operating budget bill is filed.
The bill outlines a $4,771 billion spending plan, accompanied by an additional one time, $221 million appropriation for projects including the police body cameras and Redding Consortium recommendations.
Lawmakers will finalize the Bond Bill next week, and Grant-in-Aid on June 28th.
Roman Battaglia is a corps member withReport for America, a national service program that places journalists into local newsrooms.
