Fiscal Year 2004 Budget

2003 State of the State Address of Governor Ruth Ann Minner
January 23, 2003

Governor Minner may deviate from prepared remarks

Lieutenant Governor Carney, President Pro Tem Adams, Speaker Spence, members of the 142nd General Assembly, members of the Delaware judiciary, members of my Cabinet, distinguished guests, my family and my fellow Delawareans.

As I stand before you today, I can report that the state of the State of Delaware is strong. We are a leader in educating children and protecting health. We are in the forefront in cracking down on polluters and in preparing for bioterrorism.

We are recognized for our plans to curtail sprawl and make our state more livable. And while we confront a national economic recession with challenges that still lie ahead, we have shown that Delawares finances remain sound.

As my 49 colleagues around the country give their State of the State addresses this month to your colleagues, you and I are nearly the only ones who can say we have not raised taxes, drastically slashed services, laid off state workers or raided our emergency reserve funds in the last two years. In fact, while other states have opted for one-time and short-term fixes, we have taken the responsible and prudent course of seeking long-term solutions to our fiscal situation.

The reason for Delawares success over the last two years and over the last two decades has been our willingness, our ability and our will to focus on the future of our state, even when it means making unenviable decisions in the present.

As in the past, we have worked together legislative and executive, Democrats and Republicans, senators and representatives, to do what is best for Delaware. Its what we mean when we refer to the Delaware way.

There are times when we must rise above the political turmoil of today and focus on the tomorrow. This is one of those times, and the opportunity we have is for future Delawareans to look back and see that we focused on their good, perhaps ahead of our own.

So let me begin discussing these opportunities.

Industrial responsibility

In the last two years, we have strengthened Delawares environmental laws to better protect and inform the public. In 2001, the Environmental Right-To-Know Act met the expectation of our citizens that we inform them of environmental incidents in their communities.

Last year, the Jeffrey Davis Aboveground Storage Tank Act gave the state, for the first time, authority to regulate chemical and other tanks that have the potential to cause harm to our workers, our residents and the environment.

And we put those facilities that repeatedly foul our air and water on notice that they will be branded chronic violators and subject to harsh penalties.

We must continue our efforts to focus on those industries and facilities that endanger Delaware and, for the first time, hold the individuals in charge of those facilities accountable.

I have proposed legislation, with Sen. McBride and Representatives Smith and Valihura, to focus on those who manage industrial facilities and their responsibilities to the community and state in which they do business.

This industrial accountability legislation will create a felony punishment for industrial officials who knowingly violate environmental standards and cause serious injury when they do.

It will expand criminal penalties for falsely reporting adherence with environmental rules and require the top Delaware operating officer of a facility to attest to its compliance with safety rules. It will subject chronic violators to independent safety audits and require industrial facilities to give us notice of environmental problems they have in other states.

Finally, this industrial accountability proposal will clarify the ability of the state to close down dangerous industrial facilities. This is a bold initiative, but it is a necessary next step in our ongoing effort to protect our most precious resources.

Today, I am also announcing the creation of a task force to review the events that led to the closure of the Metachem facility near Delaware City.

The abrupt shutdown of the plant and bankruptcy of the company have saddled the people of Delaware with 40 million tons of chemicals to clean up and up to $75 million in costs.

The goal of the task force will be to determine what environmental, operational, business and financial factors played a role in the Metachem closure and identify any steps we as a state could take to prevent this situation from occurring again. The task force will also work to identify any other industrial facilities that are at risk of becoming the next Metachem.

I am pleased to have with us today the new Metachem Task Force chair. Hes a man who is well respected for both his love of this state and his ability, honed as one of our states most respected jurists, to seek the truth. Let me introduce to you former Supreme Court justice, Chancellor and Superior Court judge, William Quillen.

In the coming months, I will announce additional initiatives designed to encourage and require industrial responsibility and environmental protection in Delaware. I look forward to sharing and working on them with you in the weeks ahead.

Livable Delaware/Water Supply/Energy

The Minner-Carney administrations Livable Delaware plan for curbing sprawl and managing growth has changed the way state and local governments approach development.

Because state taxpayers pay for the roads, schools and other services demanded by new development, we have asked our counties and towns to plan where they build and to build only where they plan.

About two-thirds of the states municipalities and all three counties are in the process of reconsidering or adopting a growth plan. The result, over time, will be more responsible and thoughtful growth.

Often, when plans for new development are proceeding through the local approval process, state government finds elements of those plans to be problematic, from the location of road entrances to the impact on the environment. Often these issues arise very late in the process, inconveniencing local officials, concerned citizens and developers as well.

This year, I will propose a legislative change to the Land Use Planning Act process to create a pre-application step for projects of a certain size. This proposal would bring together the developer, local governments and state agencies before a project is submitted for approval. This step would eliminate many of the last-minute objections and changes that take place now and, with the consultation of state agencies earlier, may result in projects that are more suitable for the affected community.

The issue of development in northern New Castle County cannot be addressed without addressing the issue of water supply.

During the 2002 drought, Delaware was the last state in the region to impose mandatory water restrictions and the first state to lift them.

That is not because we were inattentive, but because of the interconnections among water providers that allow the sharing of supplies, the suppliers ability to manage flows throughout their systems, and DNRECs oversight. I commend the public-private teamwork that went into managing this years drought, the most serious water shortage our state has seen in a century.

But the growth of our states population means significant action is necessary to ensure that water is available to every Delaware resident and business, even in a drought. I propose today that we embark on an effort to make certain that northern Delaware achieves water self-sufficiency by the year 2010.

We have already begun progress toward that goal.

The Public Service Commission is reviewing last years drought to identify future solutions. And the state, municipal water suppliers and private water companies are working together to identify the steps that must be taken to provide adequate water for everyone.

Whether we are at the end of a period of strange and turbulent weather or whether it will continue, I cannot predict. In Delaware, of course, weather is the responsibility of the Lieutenant Governor.

But in the past year, we have seen a mild winter, a dry spring, a summer drought, a fall too wet for some and a restoration of needed water supplies for others. We are likely now experiencing a normal winter but one that strains household budgets for heat and transportation.

Thats why, by this time next year, I hope to have before you a first-ever comprehensive state energy plan: one that will make us more self-sufficient in a world that sees uncertainty, one that will nurture new Delaware companies that are part of the fast-moving technology changes, and one that will provide incentives for homeowners and businesses to take part in the energy transition to renewable products.

As we strive to keep the challenges of the present from becoming the crises of the future, energy in our state is one we must address. We will work together to address it.

Homeland security

At this time last year, I told you that much of my legislative agenda for 2002 would focus on protecting our state from the threat of terrorism. Working together, you and I accomplished most of this agenda.

We passed several pieces of legislation, the most important being the Delaware Emergency Health Powers Act.

Now our food producers, pharmacists, veterinarians and medical community are all part of a massive early-alert network that will allow us to detect bioterrorism in the critical early hours when it strikes. Now we have a set of rules and procedures that will help us react swiftly and effectively if a bioterrorism attack does occur.

And now we have some of the most sweeping medical record privacy rules in the country, so that Delawareans can be assured that their medical privacy will not be compromised in the event of a bioterrorism or chemical attack.

Taken together, today we have the most comprehensive and effective anti-bioterrorism system in the country, and I thank the General Assembly for its help in dealing with this complicated but important issue.

My work on homeland security will continue this year. I will work with my homeland security adviser Phil Cabaud to secure from the federal government the necessary resources to improve our public health alert and first responder systems.

I cannot address homeland security without recognizing the 245 men and women of Delawares National Guard currently deployed on active duty, many as part of our countrys war on terror. Another 137 are expected to join them at the end of the month. I know you join with me in offering thanks to them and their families for their courageous services, as well as our prayers and wishes for their safe return.

Health and Safety/Cancer

One of governments most sacred duties is to protect the health and safety of its citizens. And we are doing that in Delaware.

In the area of public safety, we have supported our emergency responders by fixing the long-troubled 800-megahertz radio system that is the backbone of communication for firefighters, police officers and EMS workers.

Lt. Gov. Carney has distributed more than 20,000 free cable gun locks, hoping they will keep those guns from becoming part of the tragic accidents we often read about and shudder.

Last year, you joined me in strengthening the penalties for individuals who repeatedly drink and drive. But there is more to be done. I ask, once again, for the General Assembly to lower the legal blood alcohol level while driving to .08 and to ban open containers of alcohol from the passenger compartments of cars and trucks.

It is estimated that these measures will save lives, prevent injuries and prevent the loss of at least $1.6 million of federal highway funding.

I have spoken to you and the people of Delaware often of my desire and commitment to reduce the high rate of cancer incidence and mortality in our state.

Last year, the Delaware Advisory Council on Cancer Incidence and Mortality produced what I consider a landmark report on cancer in our state. It contains specific recommendations that doctors, cancer survivors and family members of cancer victims tell us will lower Delawares cancer rates, a personal priority of mine.

My budget proposal will include a plan to spend $5 million from the tobacco settlement fund on the first-year recommendations of the cancer council. These funds will be used to begin early screening for colorectal cancer, to pay for cancer treatment for the uninsured, to begin to investigate environmental causes of cancer and to reduce tobacco use in Delaware.

Id like to recognize and have all of us thank the Delawarean who led the council and provided a road map for our efforts to fight cancer. His commitment to his son, who was diagnosed with leukemia but is now in remission, has turned into a commitment to all Delawareans with cancer. Please welcome Bill Bowser.

One of the recommendations of the cancer council, one approved by this legislature, was the Clean Indoor Air Act.

Let me read to you a letter about the act from 10-year old Kimberly Eagle: I appreciate it very much because when I was 6 years old I was diagnosed with cancer. And I am very happy that you put the smoking law up because when I went into a restaurant and had to walk past a bar to go to my table it hurt my lungs a lot.

The message from Kimberly and from me is this: Be proud of what you did for the people of Delaware and for the generations yet to come.

Yes, there are loud detractors, but there is also a quiet majority grateful for clean air and the opportunity to now dine and socialize where they please.

For the same reason that we should not borrow from future generations to solve this years budget problem, we should not sacrifice the health of those who work here or who will be born and grow up in Delaware to the critics of last years bold step. That Delaware is one of the first states to care so deeply for its citizens instead of being one of the last is to our credit, and I want to keep it that way.

Character education

In our schools, we are seeing the results of the standards and accountability program that our state committed to a decade ago. In the last two years, we have seen improvement in reading and math scores in all the key grades in our accountability system.

This, to me, shows the wisdom of setting high standards, of deciding together how to help our children meet those standards, and in remaining committed to the means that will lead us to our desired end a truly world-class school system. We will remain true to this commitment.

As we develop our childrens intellect and abilities, we should also seek to develop in them virtues that are good for them and good for society.

To do this, I have directed the Secretary of Education to research and identify innovative character education programs that could be added to school districts at little or no cost to them. This curriculum addition would be completely voluntarily, but I believe those schools who take advantage of character education will find themselves producing better students and better citizens.

Campaign Finance Reform

For the elected officials here today, each of us arrived through the democratic process, a system of representation that began in our state and nation more than 200 years ago. I believe we have a responsibility to maintain and improve that process.

In keeping with that responsibility, I believe it is time to address the issue of campaign finance reform in Delaware, in particular the newest kind of attack ad paid for by independent expenditures.

I am talking about the vicious, personal attacks against political candidates both Democrats and Republicansby organizations with mysterious sounding names no one has heard of until campaign season.

These independent expenditures allow such groups to evade our campaign contribution limits, buy the outcome of elections, and worst yet, the negative ads they pay for sour our citizens on the political process.

We can't stop these adsthe First Amendment protects them. But I believe we can do two important things. First, we can strengthen our laws to make sure these ads are really independent, and not simply efforts by political candidates to circumvent our campaign finance laws.

Second, we can make a better effort to require the people who pay for these ads to reveal who they really are, rather than letting them hide behind fictitious names and bogus groups.

So, in the coming months, I will submit for your consideration campaign finance reform legislation to address these problems and I ask you to consider it carefully. There is an old saying that sunlight is the best disinfectant, and I believe that if we shine some light on who is paying for these ads, Delawareans will be well-served.

Technology Court

As you know, Delaware has struggled over the last few years as the countrys economy has softened. But there have been some bright spots.

Two weeks ago Palmetto Management and Engineering announced it would bring 350 high-wage jobs to Wilmington.

Last week, Bank One agreed to locate two new state of the art data centers in Delaware one in Bear and one in Wilmington and create 100 jobs. That means a total of 2,600 new jobs have been created in Delaware since January 2001.

Also last week, I was proud to reveal that M&T Bank will keep the Allfirst facility in Millsboro open, a facility many thought sure to close when Allfirsts merger with M&T was announced last fall. In fact, M&T may even expand in Millsboro in the future, bringing more employment opportunities to our state.

These announcements show that Delaware continues to be a desirable place to do business.

Last year, the Strategic Economic Council, led by DuPont senior vice president Stacy Mobley, recommended a number of steps for making Delawares economy even stronger. Among the recommendations was one that Delaware create special procedures in its already well-respected Chancery Court to hear disputes in the area of technology-related commerce.

According to the Council, in the coming decades, we cannot maintain expertise in law whether in intellectual property, privacy, patent and trademark, or the UCC without expertise in the increasingly complex technological developments involved.

To maintain Delawares preeminence in the area of business law and preserve the sizeable economic impact business law has on our state, I will submit legislation creating new technology court procedures for your consideration.

I will also to reconvene the Council throughout the year to continue to identify opportunities and policies that will keep Delaware first in job retention and creation.

Budget Preview

Finally, you have agreed to allow me to return to you next week and detail my proposed Fiscal Year 2004 budget. So I will not dwell much on it today.

What I will say is this: The task for you and I in enacting a balanced budget is considerable. When I began work on the budget proposal, the gap between projected revenues and expenditures for FY04 stood at $300 million more than 10 percent of our budget.

The gap existed because the current projection of revenues next year is that they will be less than state governments level of spending this year. Add to that the largely unavoidable increases to the budget from the mandated costs we see every year: increases in Medicaid, increases in health care and prescription costs, increases in costs for schools because of a growing student population, and increases in costs for our growing prisons.

Further complicating the budget picture is the fact that revenues for FY05 are also currently forecast to be lower than this years budget and economists are not forecasting a quick recovery in fact many are forecasting a double-dip recession instead.

In short, there is a structural problem in our state budget: the fact that revenue forecasts for the next two years are well below the current level of expenditures.

The only responsible way(s) to align revenues and expenditures are to cut the budget in ways that are sustainable or raise sustainable revenue. Temporary or one-time revenue sources will not solve the fundamental and structural budget problem our state faces.

As you know, my philosophy during these past two years has been to avoid quick fixes that sacrifice long-term fiscal health.

Since I took office, we have cut or saved almost $200 million from the budget. In fact, these cuts began on my second day in office. The FY04 budget I propose next week will include further cuts.

One such cut has already been announced -- the closing of the Governor Bacon Health Center in Delaware City. The state has been operating three nursing homes when it only needs two, creating the opportunity to save $2.5 million without diminishing services to citizens or putting state employees out of work. The level of care these patients receive will not change as they and the employees who have served them so well are moved to one of our two other health care facilities.

When I release my budget proposal and as we discuss it between now and June 30, I urge those of you who were here to remember and those of you who werent to look back at the way our state has faced such challenges in the past.

I know how difficult these next few months will be. Many of us in the chamber were here in the 1970s and in the early 1990s, the last two times our state faced a fiscal crisis of this size.

We know that the only way to solve the problem is together legislative and executive, Democrats and Republicans, senators and representatives in the Delaware way.

Conclusion

As I said when I began, this is a time of challenge and of opportunity. This is a time for a focus on the future. This is a time to face the realities of our situation and to work together to find responsible solutions.

Newsman Edward R. Murrow once said, Difficulty is the excuse history never accepts.

We face difficult decisions over the next several months. Let us work together to prove ourselves and our mettle to history.

Thank you.