Fiscal Year 2002 Budget

2001 State of the State Address of Governor Ruth Ann Minner
January 25, 2001

Governor Minner may deviate from prepared remarks

Lieutenant Governor Carney, President Pro Tem Sharp, Speaker Spence, members of the 141st General Assembly, members of the Delaware judiciary, members of my Cabinet, distinguished guests, my family and my fellow Delawareans, thank you for allowing me the opportunity to address you today on the state of our great state.

To the members of the General Assembly, let me express my sincere appreciation for the kindness and consideration you have shown me in my first weeks, as well as to my staff and to my Cabinet. I am more confident now than I ever was that I will have one of the best relationships that a Governor has ever had with the General Assembly, and for that I am grateful.

In return, I make you this promise. As a legislator and Lieutenant Governor, I sat through many of these speeches. I know what it's like to sit through these speeches.

So I promise you that this State of the State, like a good pizza, will be delivered in 25 minutes or less.

Financial Picture

So let me begin with this: We have benefited from the longest economic expansion in recent history. Delaware, like other states, has seen extraordinary revenue surpluses over the last four years.

These surpluses have allowed us to cut taxes, pay down our debt, expand and improve programs from education to welfare reform, and make capital investments of over $1 billion in preserving our state's farmland and open spaces, improving our water, and wiring our schools - all while keeping our balance sheet solidly in the black.

But our revenue picture has changed significantly in the last year. The rate of growth in state revenues has slowed due to sizeable tax cuts and a slowing economy.

Our auto plants face competitive pressure. A landmark Delaware company is up for sale. And the cost of environmental compliance is making it tough for Delaware's agricultural industry to prosper.

On the expenditure side, the picture is changing as well. Medicaid has run large deficits over the last eighteen months. In large part, this deficit is a result of the expansion of health care coverage for children.

But, more generally, the Medicaid deficit may result from a slowing economy, rising health care costs, and other trends may continue - and escalate - over the next several years.

I was here during our last recession, as many of you were. We know that we must heed these early warning signs and be prepared to work together to make the hard choices that will keep our economy strong.

I begin my administration with more limited resources than the last one did. Two months ago, it was projected that we would end the current fiscal year with a deficit of $35 million. Thanks to hard work in our state agencies and by Budget Director Pete Ross and his deputy Bert Scoglietti, I am happy to report to you today that we are back on course to end our year in the black.

For the future, the state has sufficient revenue and borrowing authority to meet the most pressing needs. But gone are the days of $200 million or $400 million surpluses.

Commitments to fund school construction for referenda already passed will consume most of the available revenue. If this year's pending school referenda pass, we are looking at a $452 million bill - a necessary but high cost we must address even before we can talk about building even more schools.

In this year, and in coming years as well, we will have to make tough choices between competing and equally deserving priorities. I am prepared to do that.

Patient's Rights and Right-To-Know

I have already announced two of my priorities for the year. First, working with Sen. Blevins and Rep. Maier, a Patient's Bill of Rights. This will ensure that Delawareans, especially our seniors, get the health care that they need, that they deserve, that they have paid for and- in some cases - are not getting. I ask you to work with me to achieve this goal.

I have also announced, with the help of Sen. McBride, an Environmental Right-To-Know measure, providing more timely notification to residents in the event of an environmental incident. Again, I ask you to work with me to provide better protection and information to our citizens.

Today, I will focus on two additional areas that Delawareans have asked me and you as elected officials to address. They are education and growth.

Reading Specialists

Education is certainly the most pressing issue we face in our state, and for good reason. Every facet of our state and our society depends on preparing today's children for the challenges of tomorrow, in work and in life.

Over the past several years, we have built the framework for improvement in our schools - establishing standards, developing tests to measure those standards, supporting our teachers and implementing accountability. I believe we are beginning to see the fruit of these labors and must remain committed to the path we are on. But we are far from where we want to be. And so the work is just beginning.

There are many possible solutions for improving our schools. Most of them are worthy and would work - if only we had the resources to implement them all. But as I have said before, this is a time for tough choices.

I believe, as do many experts, that reading is the most crucial aspect of education. Without a proper foundation in reading, it is not possible for a student to master math, or history, or literature or science. And so every child who leaves the early grades without good reading skills is a child who will struggle through their remaining days - in school and in life.

That's why I will focus on the one reform that I believe will make the most difference in the educational lives of our children. That's my promise to put a reading specialist in every elementary school, a reading specialist who can spend extra time with students in early grades and help smooth the path for them for years to come.

As I was preparing this address this week, I read a letter to the editor that mirrored my feelings on education precisely. The letter was titled, "Help children learn before they fall back academically," and it was written by Mary Beth Evans, a schoolteacher at Drew Pyle Elementary School. Her message is a simple one. "Preventing children from falling behind has to be simpler and less expensive than treating the problems later." I am glad that Mary Beth could join us today as my special guest to help me stress the need for reading specialists for our elementary schools. Please join me in welcoming Mary Beth Evans.

It is estimated that putting a reading specialist in every elementary school will cost $5 million. But I pledge to make it my number one budget priority, and I ask that the General Assembly work with me to ensure our children's educational futures.

Growth Agenda

The other area that cries out for attention from state government is growth.

Delaware is growing faster than any northeastern state. Each new resident costs state taxpayers almost $10,000 in new infrastructure and services - including roads, water and sewer, schools, libraries and emergency services.

If that growth is poorly planned - leapfrogging over developed areas into unincorporated and rural parts of our state - the cost of growth is even higher. Already, 72 percent of Delawareans live outside town and city limits.

Zoning is a local matter. But because government in Delaware is so centralized at the state level, every taxpayer bears the cost of land-use decisions that ignore all our efforts to plan for growth.

The state, with an eye on the big picture, must play a role in encouraging growth in areas that we've agreed are ready to accept it.

We need to pursue a strategy that will keep sprawl in check, reduce traffic congestion, strengthen our towns and cities, and protect our huge investment in roads, schools and other infrastructure. I propose to call it "Livable Delaware."

"Livable Delaware" is not anti-growth. It will offer carrots, not sticks, to channel development to growth zones that already have been designated by state, county and local governments.

Elements of such a strategy already are in place. Open space and farmland preservation. Redevelopment of brownfield sites. Preservation of our major highway corridors to promote safer travel and minimize the need to build new roads in the future. Tax credits for historic preservation. Coordination and cooperation among state agencies, the county and the community on projects like AstraZeneca.

I plan to unveil my full "Livable Delaware" strategy in the coming months.

E-Government

The Minner-Carney Administration is not only the first administration of the new millennium. It also represents the first Delaware administration to exist in its entirety during the Internet era. For the first time in Delaware's history, from the first day this Governor took office, the Internet is a regular fixture in the lives of a large number of Delaware citizens.

In fact, this State of the State address is being broadcast live on the Internet, so to those who are joining us via the web, I say welcome.

I especially welcome the classes at Milford Middle School, who I know are watching from their school computer lab.

Today, thousands of Delawareans have incorporated the Internet into their daily lives. We had four million hits on our website last month. The time is right for the State to fully incorporate the Internet into the way it conducts its daily business of providing service to its citizens. And the goal should be to harness this technology, making it easier to interact with government - easier on people and easier on resources like paper and fuel.

Last year, the State of Delaware conducted an e-Government assessment, comparing the number and types of services it provided via the Internet to other states. We found that Delaware was behind most states in what we put online.

As a result, state agencies have already completed some projects, including the polling place locator provided by the State Election Commissioner's Office and an online job application on the State Personnel Office site.

Today, we are in the middle of several important e-Government projects.

First, a complete overhaul of the State's web site. On our new home page, we will organize services and information in a way that makes the user's experience easier, more efficient and more enjoyable. Web users will see our new website operational by spring.

Second, a new state-of-the-art web presence for the Division of Motor Vehicles. This "next generation" website will utilize the latest technologies to meet the needs of DMV customers in a way no other state is today.

Finally, we will establish a set of statewide technical and policy standards that will provide a consistent framework for state agencies as they move services and information onto the Internet.

I thank our State Treasurer, Jack Markell, for the leadership he has provided on this project so far, and look forward to moving Delaware government further onto the web.

Air Quality

Now let me speak for a moment about some of the challenges I have inherited.

Between 1994 and 1997, vehicle miles traveled on Delaware roads increased by more than 12 percent - about three times faster than our population growth during those years. During that same period, the number of Delaware-registered vehicles grew by 10 percent.

All that traffic generates ground-level ozone, which irritates the lungs and eyes and can temporarily decrease lung capacity by as much as 20 percent. Delaware is falling short of meeting its federal ozone emissions target. We have until July 24 to demonstrate to the federal Environmental Protection Agency that we can meet that target by 2005.

Therefore we must study our options and decide on the best course. About 85 percent of our shortfall could be met by lowering the speed limit on SR-1 and Interstate 495 during the summer, if that's something we agree we want to do. We can also look at our vehicle inspection process and changes in our land-use policies. This is an issue we must revisit between now and summer.

DUI Sanctions

Last October, Delaware's federal highway construction funds were reduced by $2.1 million because we have not passed tougher open-container and repeat-offender DUI laws.

If we don't act, we will continue to lose that amount in federal highway funds every year until October 2003, when the sanction will grow to $4.2 million a year.

Likewise, we face a loss of up to $16 million in federal aid beginning in 2003 unless we lower the legal blood-alcohol limit from .10 to .08. The funds can be restored if we enact these highway safety measures, and we may qualify for additional funds as well.

In the coming months, we should consider these measures on their merits and understand the consequences - on our bottom line as well as on public safety.

>PHRST

One more issue: For some time now, state government has been designing and implementing an integrated payroll and human resources system called PHRST. The first phase of the project, the human resources system, was completed successfully and has been operating for nearly two years. But the payroll system, as many of you know, has been delayed and delayed, and the cost of the project is now over $30 million.

To evaluate the current status of PHRST and determine the best option for moving forward, I have asked that an independent assessment be made of the project. I hope to have a report back soon, and to be able to make a recommendation on our future course by the time the General Assembly returns in March.

Goals For The Year

There are many other challenges we face and goals I have for the coming year.

I will focus on Delaware's children - working to improve our foster care system and making child safety the first priority of our children's agencies.

I charge my Secretary of Transportation with boosting morale at DelDOT and the public's confidence in its employees.

I will ensure that we continue to make progress towards a safe and clean environment.

I pledge to make state government a better business partner, especially fostering the growth of small businesses - including those owned by women and minorities.

I recognize farming as a valuable part of our state's economy and culture, and will work to keep it viable.

Conclusion

These are my priorities for the year. I will add to them in the coming weeks as I unveil my legislative agenda and prepare my own budget recommendations for the General Assembly's consideration.

I have been Governor for just 22 days now. It has been a fast start, but I am pleased by and proud of what we have accomplished already.

As we forge into the next year and the next chapter in Delaware's history, I look forward to working with you to resolve our state's challenges.

At the end of the presidential elections in 1984, one columnist wrote this: "We love the blather and boast, the charge and countercharge of campaigning. Governing is a tougher deal."

Governing will indeed be tougher in Delaware over the next several years. But I have prepared a long time for my service as your Governor.

I did not come here just to make the easy decisions. I came to help face the hard ones. I look forward to working with each of you to continue our financial stability and our wonderful quality of life.

Thank you.