fiscal problems still
well short of being resolved
County Council recently enacted the fiscal 2010 budget, it was
something like a fifth-inning grand slam home run. It may have
represented an accomplishment and looked good on the scoreboard,
but everyone in the bleachers knew there were still several
"I made it clear
that this was not a one-year problem," County Executive
Christopher Coons said, referring to his budget address in
March. "We've made real progress in cutting our costs. We have
to work even harder next year."
During the past few
years, his administration has been forced to deal with a
worsening financial situation. On top of what he and others
termed a structural deficiency involving near total dependence
on real estate to generate revenue, came the collapse of
national and regional economies.
That showed up most
dramatically in the county's share of the state tax on real
estate sales, which plummeted to an estimated $16.6
million this fiscal
year from $32 million last year and $40.5 million in fiscal 2006
during the boom in the housing market.
Even with the 25%
increase in the property-tax rate which Council approved and a
5% across-the-board pay cut for county government employees
other cost-cutting measures, it will be necessary to dip into
previously accumulated reserves for $6.7 million in order to
balance the fiscal 2010 budget.
long-term projections, based on current resources and believable
assumptions, indicate that the county is facing an $88.2 million
budget shortfall between now and fiscal 2014.
During an interview
with Delaforum, Coons declined to say specifically whether he
felt the limit for tax hikes, pay cuts and service reductions
has been reached. "Our biggest challenge is how few options we
have," he said.
Castle County residents -- likely transferees from
Fort Monmouth, N.J. -- attend a county-sponsored
exposition. Attracting them to live here is part of
an effort to expand the tax base and boost the local
He did reiterate
his long-standing belief that the long-term solution lies with
the state legislature.
He said his
administration will redouble efforts to convince the General
Assembly to allow the county to diversify its revenue streams.
He emphasized that he is not seeking a bailout, but favorable
action on "the concrete proposals we've made" between now and
the time he submits the next county budget in March, 2010. The proposals are
taxing hotel accommodations, cellular telephone service and
cable utilities' assets and restoration of the county's share of
corporation filing fees.
On the other hand,
the county wants "to get through June 30 without losing any more
money to the state," he said. Beyond an anticipated further
reduction in state reimbursement for paramedics services, he said he is
not aware of any other threats percolating in Dover.
indications that the national recession may be bottoming out and
that the real estate market may be starting to stir, Coons, like
his counterparts in local governments throughout the nation,
have their eyes fixed on the tail end of the alphabet.
"The big question
is whether it's going to be a U, a V or a W," he said. That
refers, respectively, to the recession bottoming out but holding
at a low level for several weeks or months before turning up;
the economy recovering as
sharply and quickly as it declined; or a short recovery which
loses steam and slips back before growth finally resumes.
There are also a few more
immediate hopeful signs. The county economy, Coons said, expects
to benefit significantly from the relocation of Department of
Defense communications research and development from Fort
Monmouth, N.J., to Aberdeen (Md.) Proving Ground.
is making a significant economic development effort to attract
holders of as many as possible of the 28,000 jobs to be
filled by civilian workers being transferred or new hires to
make their homes and the firms which support the military
operation to locate on this side of the Mason-Dixon Line.
director of the county redevelopment office, said surveys
indicate that as many as 10% of the transferees would prefer to
live in Delaware, with emphasis on the Newark area. The county
is taking the lead in sponsoring tours of the area and linking
them with companies and service providers to ease the relocation
several of the folk who attended the third in a series of
informational expositions and toured the area on June 6
indicated receptivity. "We prefer Delaware based on what we've
seen," said Howard Chyatt.
several local firms and private agencies are backing the
recruiting effort. The exposition was co-sponsored by the
homebuilders, apartment owners and realtor organizations. The
University of Delaware and Delaware Technical & Community
College are offering in-state tuition to members of transferring
To a large extent,
he said, success in the effort depends on establishing a
commuter rail link between Newark and Perryville, Md., the
respective terminuses of Southeastern Pennsylvania and Maryland
Coons said he is
hopeful that the Chrysler plant site will be developed by the
University of Delaware into a 'technology park'. Although the
university would be exempt from the property tax, he added that
he also is hopeful that the commercial nature of the venture
would lead to some compensating arrangement.
Delaforum interview, he also dropped a tantalizing hint by
saying that he is aware of an effort "to try to reopen the
General Motors plant as an automobile plant with a new owner."
He said he was not at liberty to comment further.
about three-fourths of its operating expenses going to pay and
provide health care, pension and other benefits to its
employees, county government cost-cutting must necessarily focus
first on the workforce. There currently are 1,471 employees,
down from 1,574 in 2005 and another 97 positions are vacant.
About 40 employees have given
notice that they intend to retire and, with a relatively
large proportion of long-service workers on the rolls,
approximately 400 others are eligible to retire.
Although much of the general
public is inclined to regard reducing the number of government
workers a sign of efficiency, there is the inevitable other side
to the equation. Fewer workers means less services to the
Governments do not produce and
sell products; their function is to provide services, Coons
pointed out. At a series of 'listening sessions' in each of the
Council districts while the budget was being crafted early this
year, he said, there was overwhelming support for maintaining,
if not increasing, the level of county services and straw votes
taken at the sessions demonstrated willingness to accept a
significant tax increase to pay for them.
Despite what Coons considered
recognition of county government's plight and a gratifying
response, the fact remains that only a tiny portion of the
county's residents attended the sessions. The 25% property-tax
increase that Council enacted will hit home when the bills go
out in July or mortgage companies adjust escrow accounts to
cover it. Property taxes are due at the end of September.
Cuts in services imposed to
balance the budget for the current fiscal have already generated
measurable dismay among some segments of the public. Elimination
of Sunday hours at the libraries is probably the most notable.
Just becoming visible are the effects of reduced maintenance at
county parks. More critical will be the results of layoffs of
paramedics and the yet-to-be-determined cutback in the police
Coons emphasized that the nine
paramedics involved were trainees and that redeployments will be
used to preserve current levels of police protection.
He said negotiations are
continuing with the police union. There were comments from both
sides before Council's budget vote on May 27 indicating that
agreement was close, but no further word has been forthcoming.
The approved budget included a $1.2 million reduction in the
salaries line of the Department of Safety component.
A set of ordinances will be
introduced at Council's session on June 9 approving new salary
schedules incorporating the pay cuts. A separate public
statement, issued on June 6, said the administration is seeking
to "negotiate new contracts with our workforce that better
reflect our fiscal reality." Members of five of the six county
unions have been working without contracts since April, 2008.
The pay cuts that four of them agreed to were contained in
amendments to previous contracts, which remain in force until
new ones are approved.
Beyond public safety, he said,
there are currently vacant positions that are crucial. "We'll
have to see when we are in a position to be able to fill them,"
Coons has commented on several
occasions that he enjoys being county executive. Asked during
the interview if he was still enjoying the job, he replied, "I
enjoy the challenge ... [of] fighting for the good things that
the county does."
There is a certain satisfaction
involved "in trying to help people through hard times" during
what is likely to go down in history as the Great Recession, he
"With the problems we face, it's
not easy, but the people we work with make the job enjoyable,"