For Immediate Release: Tuesday, May 27, 2025
For More Information: Contact: J. Fulgham, 302-744-4184
On the eve of the budget-writing Joint Finance Committee beginning its work to fine-tune the state’s spending plan for the upcoming fiscal year, House Republicans are offering a series of suggestions to curtail state spending growth.
Earlier this spring, Gov. Matt Meyer released his suggested $6.58 billion FY2026 state operating budget that would take effect July 1st. The proposal is an increase of about 7.4% over the current $6.1 billion budget.
If enacted in time for the start of the new fiscal year on July 1st, state spending would be more than $2 billion higher than it was just five years ago—an astonishing increase of more than 45%. Worse yet, state spending is expected to outpace revenue growth over the next several years.
During the governor’s budget presentation in March, Office of Management and Budget Director Brian Maxwell indicated that the administration plans to spend the entire $469 million Budget Stabilization Fund—money set aside to deal with an economic slowdown—and that within two years, the state could face a nearly half-billion-dollar budget shortfall.
“Planning to spend money faster than it comes in is a blueprint for failure,” said State House Republican Whip Jeff Spiegelman (R-Clayton, Smyrna, Townsend). “Before we ask working Delawareans and our small business owners to reach deeper into their pockets to pay higher taxes and fees, we have an obligation to reduce the gap we need to fill.”
Suggestions to Reduce Spending in the Upcoming Budget:
• Cut targeted state job vacancies: There are currently 2,139 vacant full-time state positions (not including teachers), of which 1,460 are financed through the General Fund. More than half (886) have been vacant for at least six months. Assuming a conservative estimate of $50,000 per position in wages/salary and benefits, eliminating these persistent vacancies would allow $44.3 million that would have otherwise been budgeted to support these open positions to more urgent needs.
• Lengthen by one year the plan to raise the starting salary for public school teachers to $60,000: Delaying the completion of this goal from 2027 to 2028 allows for the expenditure earmarked for it in the upcoming budget to be reduced from $75.5 million to $45.5 million. This proposal would preserve most of the planned increase, not affect step-increases, and save $30 million.
• Reduce the size of the budget increase from 7.4% to 6.4%: Require every department secretary and division director to identify cost savings in their operations, amounting to one percent of their projected FY2026 budgets. Direct the Joint Finance Committee to reduce funding in the governor’s suggested budget by a corresponding one percent. Under this suggestion, most agencies would still see a sizable funding increase in the upcoming budget, but modestly curtailing the amount of this growth would reduce General Fund expenditures by more than $65 million.
Suggestions to Reduce Spending in FY2027 and Beyond:
• Conduct an inventory of all state-owned buildings and real estate, and sell all unneeded, unwanted, or surplus assets.
• Require every state agency to conduct a Supply Expense Reduction Plan—a strategic approach to cut costs related to supplies and procurement while maintaining efficiency and quality. The plans should consider:
Negotiating better deals with suppliers.
Optimizing inventory management to reduce waste.
Coordinate purchasing to gain savings through economies of scale.
Leveraging technology, including AI, to streamline procurement.
Identifying alternative sourcing options for cost savings.
• Set aside the requirement to observe the state prevailing wage scale only for those renovation and construction projects not fully funded by state and federal money. Allowing competitive market pricing for municipal and school district projects, where the local entity provides partial funding, will reduce costs by an estimated 20% and save state and local taxpayers significant money.
• Lengthen the planned service life of state-owned vehicles by one year.
Additional:
Joint Finance Committee State Rep. Charles Postles (R-Milford, Frederica) also called for significant downsizing of two bills recently shared with state lawmakers, seeking to raise the cost of numerous fees, licenses, and permits under the control of the Department of Natural Resources and Environmental Control (DNREC) and the Delaware Department of Transportation (DelDOT). The revenue raised through the charges offsets the tax dollars needed to operate each agency.
Rep. Postles said while some of the fees have not been increased for many years and are worthy of consideration, lawmakers should not approve either proposal as is. “It took a long time for them to reach this point,” Rep. Postles said. “They could have addressed this incrementally over the last five or more years when we were flush with cash. Now, I can’t in good conscience call for General Fund spending cuts on one hand while at the same time giving a green light to hikes that will cost citizens and small businesses millions of additional dollars annually.”
