Here is Video via WDEL site
COUNTY EXECUTIVE COONS' FY2010 BUDGET ADDRESS
New Castle, DE - County Executive Coons delivered his FY2010 budget address March 17, 2009, in the Council Chambers of the Redding City/County Building . To read the full text of the speech, click the link below.
New Castle County Executive
Christopher A. Coons
FY2010 Budget Address
Tuesday, March 17, 2009
Text From NCC Site
Good evening, ladies and gentlemen. Thank you for joining me here as I present my
Fiscal Year 2010 budget for New Castle County.
This is a hard year, and before us, we face choices unmatched in our government’s
history. In the past six months, we have witnessed a dramatic change in the ground
beneath us, as first the housing market, then the broader financial markets, and now our
entire national economy have changed in ways not seen in more than a generation.
Our local situation is no different, as the budget deficit facing our county has nearly
tripled from what we had projected just a year ago, and now threatens the future of our
county’s essential and valued services if we do not take strong action and change
course now.
Tonight, I will present a budget that takes a balanced path towards solving our more
than $40M deficit for the coming fiscal year. Rather than taking an extreme approach
that either slashes the county workforce and the services they provide, or that
dramatically raises taxes beyond what our community can fairly bear, I am taking a
balanced, middle course, one that asks for shared sacrifice across all who deliver our
county services, and all who benefit from and value them.
We began by cutting – by restraining growth in our budget and cutting across the board
in every area and every department. My proposal for the general operating budget
shrinks county government more than any budget in 40 years – by cutting capital
projects, reducing operating expenses, and asking for real sacrifice from the county
workforce. I am also asking for a similar amount in increased revenue, for an added
investment by every homeowner and business in order to sustain our essential services.
I did not reach this budget proposal easily or without sleepless nights. My
administration and I worked hard to find a balanced solution that we all could live with.
When I ran for County Executive, I never imagined our finances would fall so sharply, or
that we would face decisions this tough. But, frankly, I know I was elected not to dodge
hard choices, but to take them on squarely and develop a workable plan to get all of us
through it. Council, it is my hope, my belief, that as you review and debate the details of
this plan, you will agree – it is our best path forward, and it deserves your support.
At the outset, I would like to thank City Council President Norman Griffiths, WITN, and
Comcast for broadcasting tonight’s speech, as well as WDEL for carrying this address
live on radio. I thank my father and step-mother, my brother, Tom, and my wonderful
wife, Annie, for joining me here this evening. I also want to thank you, the members of
County Council, our row officers, elected officials from the state and other local
governments, my general managers, and the many county employees and residents
who have joined us here tonight.
Over the past four years, I have delivered to you budget addresses that strike a familiar
chord: doing more with less by reducing expenses, cutting our overall workforce through
attrition and the elimination of vacant positions, and increasing revenues to support vital
county services. But the decisions that we must make as we face the year ahead are
frankly, harder than ever.
As our economy began to worsen this past fall, Council and I knew we would face
difficult choices in this budget year, and we decided together to conduct a county-wide,
twelve session listening campaign. As we’ve met with hundreds of residents in listening
campaign stops over the past two months, members of Council and I have asked those
we represent a simple question: Of all that New Castle County does, what do you most
value and what are you willing to pay to support it? In meeting after meeting, the many
citizens who came to these listening campaign sessions told us how much they value
the services this county government provides. Several stand out in my mind, as we
heard how dedicated county employees had helped keep families safe, had helped our
children grow stronger and healthier, and as we heard how much our residents want us
to continue essential things about our county that they love and value.
I recall a young man, not more than 10, who stood up at the Mill Creek meeting and
spoke earnestly about how much he wants safe places to play and how much he values
playing in our county sports leagues. I remember a dignified middle-aged woman who
spoke at Holloway Terrace, saying with emotion she is now unemployed for the first
time in her working life, but she relies so much on the Delaware City library for
community and encouragement and uses the computers there to keep searching for a
job – that even though she is without work, she was willing to pay more in taxes to keep
our libraries open and their resources accessible. And I will never forget the resident
who told us at the Brandywine Hundred meeting about being home alone one night,
hearing a burglar rattling the door and trying to break in, about her frantic call to our
county 911 center and her enormous relief when minutes later a county police officer
responded to her call for help and secured her home.
We also listened as people asked many good questions about our expenses, they
asked why not reduce this or trim that, why not charge someone else or raise fees on
some other part of county services, but over and over, across a dozen nights in every
district, from Claymont to Middletown, from Hockessin to New Castle, an overwhelming
majority of the people who came out voiced their support for county services, for the
difference county employees made in their lives, and told us that we should take a
balanced approach as we crafted this budget. The value that this community places on
county services is the foundation upon which my budget proposal rests.
The challenge we faced in putting together this year’s budget is similar to local
governments across the country who have been affected by our national economic
crisis. Our problem became significantly more difficult as our national economy
collapsed and our revenue projections fell quicker than any one had expected. When
this Council adopted our current budget last May, we projected taking in $31M in real
estate transfer taxes. By December, that figure had dropped to $18M and our budget
deficit for the current fiscal year had doubled. In the past months, our revenues
continued to drop and our expenses to rise. With yesterday’s bad news from the state
DEFAC, our projections for RTT for this year now stands at roughly $16M, just half of
what we built our current fiscal year’s budget on just nine months ago.
Equally important, the falling market conditions have also had an impact on our pension
costs. The County Pension Board will meet tomorrow to learn how the market
meltdown has affected the balance of our county’s important pension fund. It is
expected that the Pension Board report will increase our projected deficit for this coming
year from $40M to more than $48M. So, in a very real sense, the economic ground
continues to shift beneath us, even as we seek solutions. Simply put, we cannot
assume that what we now face is the worst of it.
It is also worth noting that, unlike some governments, this tough budget climate set in
just as we were already working to address long-term structural financial difficulties
unique to this county government. Over the past four budget years, this Council joined
with me in cutting millions of dollars in expenses, delaying or canceling $72M in capital
projects, and eliminating 147 vacant full-time and part-time positions. We ended
popular special events, cut travel and training, and cut the size of our fleet, all well
before this economic downturn took hold.
This is a tough environment, but it also offers opportunities – opportunities for all of us
to re-examine our government and reconsider what are our essential services and how
we can deliver them more efficiently. The task that lies before us is not easy, but in the
words of Theodore Roosevelt, “in any moment of decision, the worst thing you can do is
nothing.”
As we look to address the challenges ahead, it is important to remember that this form
of county government is only 40 years old, and in this very difficult economic climate, we
have to ask ourselves the fundamental questions once again about our role and core
mission. Do we want – do we need – the county government that we currently have?
Are there things that we do that are so essential to the lives of our residents that we
have to continue doing them in the way we do? Are there things that we’ve added to
our plate that are not essential? Or, are there things that New Castle County has been
doing that really could be done better by others or in partnership with others?
Working through these basic questions has led my administration into uncharted
conversations and we listened closely to the valuable input we received from the
broader community. We have taken programs that this county has been involved in for
years and eliminated, reduced or shifted them to volunteer partners. Across our
listening campaigns we heard understandable concerns about our facilities, like
Rockwood and Carousel, valuable special units like the Mounted Patrol, and our
libraries. We have strong community-support programs and community partnerships
like the PAL Centers and the Showmobile that have been signature parts of this
government for years. Every one of those programs and services that I just mentioned
will be realigned, or significantly reduced, in the budget I propose tonight. Each
represents a disappointing outcome for individuals and communities that have come to
rely on us for services they value. There are people who will miss things that will no
longer be provided by this county, but given our financial state, we have to live by a
changed set of priorities, which means that some things simply cannot remain as is.
Therefore, the budget I propose to you tonight includes a package of roughly $23M in
spending cuts and savings this year. The overall FY2010 proposed budget, including
both general operating and sewer, is $234M, which is a negative growth budget when
compared to our current FY2009 budget. Overall, this is the largest percentage budget
decrease in county history. In fact, if you remove the required increases in debt service
and benefits, the overall general fund budget is reduced by 10%.
This balanced approach to addressing our deficit means that significant cuts have been
made across the board. We have made substantial reductions to our capital budget,
cutting roughly $75M in previously authorized projects for the coming year, impacting 40
projects, covering everything from sewers to parks to libraries. This reflects our
unwelcome new fiscal reality. Most of these projects are being delayed, such as the
Banning Park soccer field renovations, and much needed parking improvements at
Delcastle Regional Park, but we are outright canceling projects such as the police
shooting range and a new EMS station. Keeping our capital budget from growing is the
only way to take control of our debt service costs.
We also have cut grant funding to outside agencies. Earlier this year, I notified every
organization that receives funding from New Castle County that we will be reducing or
ending such funding. Traditionally, this government has provided large and small grants
to dozens of organizations who are committed to making our communities stronger and
healthier, but we simply cannot continue to fund all of their efforts at the current levels. I
commend Council for also joining me in the decision to significantly reduce grant
funding for the coming fiscal year. From community services and non-profits, like the
Boys & Girls Clubs and the Ministry of Caring, to planning and professional groups, like
the Water Resources Agency and WILMAPCO, to our partners in the County Chamber,
4-H, and our contractual libraries, we have significantly cut or ended grant funding, and I
know each of these decisions has had consequences for the programs and services
they provide. I also want to specifically thank our largest grant partner, the volunteer
fire service for recognizing the difficult fiscal situation we face and accepting a cut of
county support of $300K, or 8%, in support from the county, which includes cuts to our
successful Emergency Services Corps program.
In addition to cuts to our capital program and grant funding, we are making cuts across
every department in county government. Eliminating or unfunding 97 vacant positions
will save us $6.5M. Reducing our contractual services by 17% will achieve $5.5 million
in savings. These services that will be cut range from grass cutting, and facilities
maintenance, to engineering and IS services. For example, our Information Services
group which oversees the county’s computer systems is also restructuring how we
purchase long-term consulting services, resulting in savings of roughly $400,000 this
year.
Internally, each department had to take a hard look and focus on their core functions
and services. We will end use of the county showmobile, which dozens of community
groups count on, but has become too costly for us to continue to operate.
We will delay the purchase of new vehicles next year which will save roughly $1.4
million.
We are canceling all our remaining large special events, including the Spring and Fall
Sleep Under the Stars and the Holiday Open House at Rockwood. We’ll be reducing
our library book purchasing budget and replacing our quarterly program guide with web-
based information, which will achieve further savings. We will also sustain the current
cuts we have made to our library hours across all our branches.
While cuts in capital, grants and general operations are important, with more than three
quarters of our county’s costs dedicated to supporting the people who deliver county
services, we have to make reductions in personnel as well to make progress in reducing
our growing deficit. We have in recent years asked our county workforce to do more
with less, as we trimmed our headcount steadily over the past four years, and they have
done well in these tough times. As I mentioned earlier, we will save $6.5 million this
year by eliminating or defunding almost 100 positions. These positions are the single
largest cut in this budget, and they reach across every department of our government,
and every type of county employee.
However, the reality is that we must do even more this year to cut our costs and our
spending in this tough fiscal climate. In December, when we were just two months into
the current downturn, I directed all of my executive branch senior staff to take a 7% pay
cut for this year. Earlier this year, I met with the representatives of our six collective
bargaining units who represent more than 80% of our workforce and asked their
members to take a roughly similar reduction in their pay for the year ahead through
either a voluntary furlough or a salary rollback that is consistent across the workforce in
order to avoid layoffs. I respect and value our county employees and the services they
provide, but in a time when employee costs continue to rise significantly faster than our
revenues, I have a responsibility to the half million residents of this county to bring those
costs down, before I ask them to contribute to solving this county’s fiscal problems.
Over several meetings, we have discussed different options, and we are making
progress, but as of today, we do not have a final agreement across the board with our
union locals. So, unfortunately, I am left with no choice but to submit a budget to
Council that proposes eliminating between 75 and 100 currently filled positions across
all departments of our government – including public safety.
My department general managers, human resources staff and the law department are
working through the specifics of both which positions will be eliminated and how these
layoffs will be carried out in each department, if it comes to that. As of today, the
budget proposal I submit to you includes the $4.8 million in savings from the elimination
of those positions. But, I will gladly accept a proposal from our union locals that can be
reasonably and fairly implemented across our workforce and achieves sustainable,
concrete savings that equals $4.8 million.
This is painful and has not occurred in New Castle County government in nearly 30
years, but we are not alone in facing these tough decisions. Many businesses and non-
profits in our community already have been forced to impose furloughs, as they have at
Hercules and at the News Journal, or broad layoffs of employees such as at Bank of
America and the Chrysler plant, leaving a growing number of residents facing the loss of
a job as a result of the worsening economy. The very real financial challenges we face
in county government are no more than those faced by our broader community, in
businesses, governments and other groups across our state and region.
Let me be clear: our county has a serious, ongoing fiscal challenge, not just this year,
but for several years to come. All of these proposed reductions for the coming year
combined, cuts to capital, grants, operations and personnel, get us just over halfway to
addressing our more than $40M deficit. In total over the next five years we face a
projected $200M shortfall, which can only be addressed by a blend of operating more
efficiently, significantly reducing costs, and raising revenue. We cannot tax our way out
of our basic, structural problem in this county, and since three-quarters of our costs are
related to people, we must get our personnel cost growth below our revenue growth.
With both our health care and pension costs rising this year in double-digit percentages,
we have to engage in productive, across the board, negotiations to reduce our on-going
personnel costs for the future. Focusing only on this year’s shortfall without heeding the
strong warning signs we face about the years to come will just not work. We will simply
be back at this same spot a year from now, more seriously cutting even more services
and personnel.
The solutions I propose in this budget use the tools we have available to us in county
government. In every listening campaign session, residents suggested new sources of
revenue that we could seek to broaden our revenue base and the possibility of
combining services with other governments. Since only the state can authorize revenue
streams for the county, I have been meeting with Governor Markell and the leadership
of the General Assembly to discuss ways we can diversify our county’s revenue. We
will continue those discussions in the months ahead, and will also be reviewing areas
where there may be duplication of services between the county and the state.
However, we cannot realistically expect significant help from the state government that
will address our fundamental budget deficit, given the enormous challenges ahead for
our officials in Dover.
Many folks have asked – rather hoped – that the much talked about federal stimulus
package would offer this government an answer to our current budget challenges. We
do expect to receive some stimulus funding, but much of the funding is dedicated to
specific purposes and will not address our core budget challenge. Stimulus funding we
may receive basically falls into three categories. First are competitive one-time capital
projects that could fund the purchase of solar energy systems, for example, to help
power county facilities or completion of greenways in our parks, both of which are
projects that we would not complete but for these federal funds. Second is federal
funding to expand current housing programs – we do expect to receive more in federal
funds for homeless assistance, foreclosure prevention, and for neighborhood
stabilization under existing federal housing programs.
The third category includes special funding for public safety under the COPS and Byrne
grant programs. I traveled to Washington just last week with Col. Rick Gregory to meet
with the Vice President’s office and our congressional delegation to ask for their help in
funding our public safety department. One possible use for this stimulus funding is to
support the proposal for additional police staffing we presented to Council last fall, and
this new federal funding stream included in the stimulus package would allow us to
attempt to implement it at a time when we otherwise could and would not. I will travel to
Washington again tomorrow to meet with Vice President Biden and 35 County
Executives from around the country to discuss the challenges ahead and to fight for
funding for New Castle County.
Cutting spending, layoffs or other personnel cuts, and stimulus funds alone will not fill
our projected $48M budget deficit, not without cutting to the bone the services our
residents say they value. Therefore, in conjunction with the broad cuts in programming,
personnel, and capital spending, tonight I am also asking New Castle County residents
for about $8 more a month on average, or roughly $100 a year which will provide the
county with an additional $21M to balance the deep cuts we have made in this budget.
This is a difficult sacrifice to be asking of working families and businesses who are
already themselves struggling under the pressure of this economy, but what we have
heard from residents across all communities in our county is fairly uniform. They want
us to balance any request for additional taxes with meaningful cuts we impose on
ourselves in hopes of moving forward with a sustainable government that will continue
its mission of delivering a better quality of life, a stronger community, and a brighter
tomorrow for all of us.
We must also continue moving forward projects and preventative maintenance for our
1,800 mile sewer system that is required for compliance per an enforcement action by
the Environmental Protection Agency and DNREC. This directive includes rehabilitation
of the aging Brandywine Hundred sewer infrastructure and expanding sewer line
inspections to further protect and improve the health of our waterways. Failing to meet
this mandate would subject us to substantial fines, and I am asking residents for an
increase of about $2 a month, or $24 on average annually in the county’s sewer rate to
cover these additional costs of sewer system maintenance.
The challenge now before us is not limited to this upcoming fiscal year. For this next
fiscal year, we can make reductions and raise revenues that would solve our budget
problem. However, if we are to continue as a county government and help lead our
community into a better future, we must also grow our economy, and increase our
efficiency. We are blessed to have reserves we can use, in part, this year to cushion
the blow of our unprecedented loss in revenue while leaving us some flexibility, should
the already bad situation grow even worse in the coming months.
As part of our overall fiscal strategy, we have benefited from continuing to be one of the
very few counties in the country that enjoys a AAA bond rating from all three rating
agencies. Our bond sale back in January will save this government $1.7M per year in
debt service by refinancing 1998 bonds, and we saved another $1.1M off the rates we
would have paid if we were only a AA rated county when we financed the sewer repairs
just underway. We must continue to invest in our infrastructure in order to help grow a
stronger local economy, and we must protect our bond rating for the long term to ensure
we leave behind the foundation for a sustainable and strong county.
One of the best ways that we can work together to accomplish that objective is by
reaching out to our business community to support and sustain their responsible growth
in New Castle County and by working to attract new employers here who will provide
good jobs in the future. We know this community needs and wants good jobs. Working
together with the business community and DEDO, we have succeeded in attracting
companies large and small to New Castle County. From Sallie Mae, which has already
hired hundreds of employees, to Voigt & Schweitzer, which has redeveloped a site in
New Castle and filled dozens of manufacturing jobs, we are working hard to grow new
businesses here. Our office of economic redevelopment, our partners in the County
and State Chambers of Commerce, and Alan Levin and his team at DEDO have worked
together to recommend and support changes to improve our development review
process that targets growing jobs and businesses now when we need them most. We
are also addressing real concerns about our planning process and are working in
partnership with DelDOT, DNREC, and other state agencies to ensure that our process
is a fair and efficient one.
The only way we will get through the current economic climate is by pulling together and
investing once again in the community where we have made our homes, raised our
families and where we enjoy a quality of life unmatched in our region. Governor
Markell’s administration has been a good partner in these efforts, and just in the past
months we have contacted and visited companies in search of employers who might
relocate here or invest in the redevelopment and growth of major parcels in our county.
To ensure we are pursuing our economic development opportunities the best we can, I
have directed several of my department managers to work together with our partners in
DEDO and the chambers of commerce to develop a specific and substantive plan for
future economic growth in this county, and to deliver that plan to me and to you on
Council later this year.
In a time when every penny counts, we must take steps to ensure our government is
operating as efficiently as possible. Over the past five years, Council and my
administration have worked together to address this county’s unique structural budget
challenges, and figure out how we could, over the course of several years, bring the
costs of our government more in line with our limited revenue streams. Last year we
launched a performance management initiative that engages our workforce in
developing detailed measures for the services that we deliver. These measures provide
us with statistics about what we are doing well, how we are best meeting the needs of
the residents we serve, and addressing areas where we need to improve. This initiative
has already included input from literally hundreds of county employees and will serve as
an effective tool we can use internally, and eventually publicly, as we continue making
choices about if, where, and how we provide programs and services to our residents.
We will begin to see the real results of this initiative in the coming months.
Additionally, we must continue our efforts to harness the energy of volunteers to help us
fill the needs of our community. In public listening campaign sessions and in e-mails
and letters, residents have expressed their willingness to pitch in to help save some of
the services, programs, and places that make New Castle County special. Volunteers
have stepped up to launch or join and strengthen friends groups for our parks and
libraries, and we have all been impressed by the volunteers and fundraising efforts of
Therapeutic Riding At Carousel or TRAC, and the Friends of Rockwood. This year, we
have also seen the launch of New Castle County Pride as an active non-profit partner
supporting several county initiatives and events – County Pride raised more than $100K
in private sector support for county programs and park clean ups last year. Anyone who
cares about and hopes to save or support programs, events or places that we are
proposing to cut is welcome to contact County Pride or Susan Eggert, our county point
person for volunteerism. Volunteer service and donations can help sustain our level of
service to the community, whether through our libraries and parks, at PAL, at Rockwood
or Carousel, through the Mounted Unit, or elsewhere, but in many cases, without
exceptional and significant new private support, we will have to move forward with the
cuts proposed in this budget that scales back the services we provide.
I was at church this morning, at a St. Patrick’s Day mass, and in between the singing of
Irish hymns and a strong homily about forgiveness and bearing each others burdens, I
prayed. I prayed this morning for hope, for hope that things in our county and country
will indeed get better, I prayed this morning for forgiveness, for the very real pain this
budget will impose on real people – on the employees and the families of those who
may lose their pay or their jobs and on people in our community who depend on county
services we may trim or end, and last I prayed for courage, the courage to do the right
thing, not just the political or popular thing, as together we lead this county government
through hard times. We come to public service from different faiths and different
traditions, but I ask you, whatever your faith, to take time tonight and be thoughtful or
prayerful, to hold in your hearts the spirit of community and of bearing one another’s
burdens, and reflect on the tough choices we have to make together.
It is my real hope that over the next six weeks of this budget process every member of
Council will take very seriously the questions I put to you. What kind of county do you
want to leave behind to our families and the children of our community? I believe I
heard clearly across this county that this is a community that values the services we
provide, that believes we make a difference, and that is willing to join us in responsibly
charting our way through the rough seas ahead.
Those who oppose a tax increase need to present a realistic alternative path, because
we cannot fill our $48M deficit through cuts alone. If this is a community that is indeed
so financially stressed that it cannot afford $8 more a month to fund police, paramedics,
libraries, and other services we have come to enjoy and depend on, then we have much
harder choices ahead. In my view, as long as we sustain the deep and difficult cuts to
our government spending that I propose in this budget, the residents we serve will
support the increased investment that we need to make this plan possible. But let me
be clear, there is one path I do not support, and that is the seemingly easy path of
simply reaching into the till of taxpayer reserves and using money set aside in our rainy
day fund to balance this year’s budget. Doing so would leave us exposed and ill-
prepared to deal with the challenges of our next budget cycle, when our national and
local economy will likely not have recovered from the current deep recession.
If we avoid the hard choices of spending cuts, layoffs or other on-going personnel cost
reductions, programming cuts or tax increases and instead spend through what is left of
our reserves, I think the message to our residents, our workforce, our current and
prospective business community, and the financial markets would be a very bad one
and the results would be clear. We would make it through this year, assuming our
situation does not worsen, but we would arrive at next year marked as an irresponsible
government that faced a real challenge and blinked. And we would do so with no
reserves to cushion the blow. What I have called the public, the workforce and you on
Council to do is not easy but I believe it must be done. It is the prudent and proper
course of action. It is the task for which we were elected. We were elected to be good
stewards of the public funds that were here when we got here, and to be good stewards
of the public needs that are presented to us more urgently today than ever before.
This budget is full of tough, but necessary decisions that reflect the reality we face.
From what I’ve seen in the last eight years of working with county employees and from
what I’ve heard in the last six weeks of our county-wide listening campaign, I am
optimistic that our community supports the essential services this government provides,
that our county workforce has a spirit of service and a willingness to do what has to be
done, and that by working together, we will have a stronger county coming out of this.
Let us pull together, make a few painful choices well, and serve the public who elected
us by meeting their real needs. As President Obama said in his address to Congress
earlier this year, “now is the time to act boldly and wisely.” I have faith you will do both.
Thank you for the opportunity to be before you tonight. God bless you. Good night.
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