Carney ready to spend money in 2022; GOP wants tax relief

Charlie Megginson Government, Headlines

John Carney in a suit and tie

Photo by Daniel Sato

The state of the state is strong, said Gov. John Carney during his annual address before a joint session of the General Assembly Thursday.

Much of Carney’s speech focused on the fallout of COVID-19, including its impact on the state’s economy and the work that still needs to be done to confront new variants and surges.

He cited the need to support continued workforce development and early childhood education, and to restore the economy with an emphasis on equity.

Republican leaders in the House and Senate responded that more should be done to help Delawareans who have suffered financially as a result of the pandemic.

“We are giving tax breaks for individuals that have been receiving unemployment, which is great for them,” said Senate Minority Whip Brian Pettyjohn, R-Georgetown. “But as we’re seeing prices rise at the grocery stores and  at the gas pumps right now, for people that have been working every single day 40, 50, 60 hours a week, whether they’re working overtime or working in their own businesses … because they can’t find workers out there — we need to be giving them help as well.”

At least one moment provided unexpected humor.

“In terms of national and international attention, it certainly doesn’t help to be the home of the president of the United States,” Carney said. “It really doesn’t.”

According to the pre-released copy of the speech, Carney intended to say “it doesn’t hurt.”

Carney also cited his administration’s advocacy for the Delaware Prosperity Partnership, which through state grants and awards has contributed to the creation of more than 20,000 jobs. That includes fin-tech startup Investor Cash Management, which announced last month that it would move its headquarters from Chicago to Downtown Wilmington.

Senate Minority Leader Gerald Hocker, R-Ocean View, said that as a small business owner, things don’t look so optimistic. 

Hocker said his grocery stores, G&E Hocker’s and Hocker’s Super Center, continue to struggle to find workers and the governor’s speech failed to offer any solutions to get people back to work.

“We hear all these new businesses that are coming to Delaware and all the jobs they’re going to bring,” Hocker said, adding that his businesses have been looking to hire new employees but haven’t been able to find anybody to fill the jobs.

“Where are all these workers going to come from? And then [Carney] talked about training and a training fund to train new employees. I’ll train my own.”

Hocker said he pays into a training fund every year but he “can’t hire from that pool” and “being a small business owner, I didn’t hear a whole lot of encouragement from our governor today.”

Carney highlighted future investments made possible by the federal COVID stimulus packages and Biden’s infrastructure bill, including building and upgrading libraries, increasing resources for gun-violence prevention programs in Wilmington and Dover, increasing mental health services and repairing aging roads and bridges. 

“We’re also investing in our environment, and we have a new Climate Action Plan to address the effects of climate change. Not just because it’s the right thing to do, but because we know that vibrant outdoor spaces help attract new workers and families.”

Carney hailed the General Assembly’s passage of a bill that put Delaware on the course to a $15 minimum wage and encouraged legislators to pass a bill to mandate companies to provide paid family and medical leave.

Republicans said they were disappointed to hear Carney express support for paid leave.

Pettyjohn said the bill would be “horrible for our businesses,” and said that a current shortage of teachers in schools is just one example.

“You have a lot of husbands and wives that are teachers within our schools and our schools are having very difficult times right now with substitute teachers,” Pettyjohn said. “So in this kind of small trial that we did for state employees, we’re seeing significant issues with that.”

Carney said that the biggest challenge Delaware faces is “building a workforce ready for jobs of the future.”

“Delaware employers have more than 33,000 open positions right now but only 26,000 Delawareans are actively looking for work,” he said. Delaware plans to invest $50 million in federal stimulus funds into workforce training programs, he noted. 

He talked about his administration’s goal to expand broadband internet access to every Delawarean, specifically in Kent and Sussex counties.

He pushed his plans to develop the Wilmington Learning Collaborative, which is designed to allow three school districts create a board that would focus only on students in the city. 

Republicans complained that Carney didn’t talk more about the ways kids were affected by the pandemic.

“Our children missed important time in their classrooms,” Hocker said. “But I didn’t hear any way that will help those children make up what they missed in education.”

Near the end of his speech, Carney emphasized that Delaware has “made it through the worst of the pandemic better than most states: without painful budget cuts, without tax increases  and without layoffs of state employees.”

Republicans said that since the state is doing so well financially, there’s no better time to give money back to the taxpayers. 

“I was here as well as my colleagues when we had an $800 million problem and we raised taxes, particularly around the real estate transfer tax,” said House Minority Leader Danny Short, R-Seaford. “Now we’ve got an $820 million surplus — maybe it’s time to give them some of that money back.”

In that spirit, Republicans on Thursday afternoon issued a press release announcing the filing of five new bills aimed at returning surplus state revenue to Delawareans.

In the release, Rep. Rich Collins, R-Millsboro, said it’s embarrassing that the General Assembly “did not enact one meaningful tax cut last year.”

“After the bills are paid, and appropriate reserves are set aside, I believe government has a duty to return money to the people from which it was taken,” Collins said. “That was an obligation the legislature failed to honor last year.”

The proposed bills would slash Delaware’s income tax, gross receipts tax and corporate tax, and temporarily eliminate and then permanently decrease the real estate transfer tax, and give low-income Delawareans a tax credit.

Those objectives are likely to be at odds with Carney’s proposed budget, which he will present next week.

The governor said during his address that his budget will be committed to fiscal responsibility while also focusing on addressing some of Delaware’s biggest needs.

Carney concluded that as a result of his administration’s actions, “unemployment is down, children are back in school, small businesses survived and we are supercharging our economy with federal resources.”

He spoke fondly over the late Ruth Ann Minner, Delaware’s first female governor.

“As I think about the past two years, and how it fits into the long history of our great state, I can’t help but think about the recent passing of Governor Ruth Ann Minner,” Carney said. “Governor Minner did not have an easy time leading up to being governor, or during her two terms wrestling with your predecessors over a laundry list of sticky issues.”

“One thing you could count on with Ruth Ann, though, was when she faced a political issue or policy choice, she always approached it through the lens of how it will affect people’s everyday lives. And another thing you could count on was that when she made a tough call – and she had to make many – she would stand by it.”

Carney concluded his remarks by assuring lawmakers that Delaware will come out of the pandemic “and when we do, we’ll be ready as a state to move forward together.”

Share this Post