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Democrats' 'viable solutions' were bad for Delawareans

By RICHARD C. CATHCART and DANIEL B. SHORT • October 13, 2009 • News Journal

We read with disappointment a recent opinion article by State Rep. Bryon Short titled "Markell on side of small business" who criticized a member of our House Republican caucus -- Rep. Gerald Hocker -- for not offering what he called "viable solutions" in the wake of our state's severe budget crisis. We disagree with that statement and, in fact, believe that if it weren't for Rep. Hocker and the rest of our caucus, Delaware taxpayers would be in much worse shape today.

Rep. Bryon Short would have us believe that the governor's $212 million in tax and fee increases was a "viable solution" worthy of recognition. He and just about 100 percent of his Democratic colleagues voted in favor of the package, whereas just about every member of the House Republicans voted against the tax and fee hikes. Included in the tax package were increases to the personal income tax (PIT) and the gross receipts tax. If it weren't for House Republicans, Delaware families and business owners would be faced with tax increases that were considerably higher, as well as indefinite. We successfully pushed for reductions to both tax increases, as well as expirations on both tax hikes. Neither recommendation was ever put on the table by the governor, Rep. Bryon Short or his caucus.

In addition to Delaware's largest-ever tax and fee increase package -- proposed by the Markell administration and supported by Rep. Bryon Short -- heavy reliance was also placed on the use of federal stimulus funding. Approximately $218 million in Recovery Act funds were used to pay for state services that normally would have been financed with money from the General Fund. In our minds and by most people's count, the use of more than $200 million in stimulus funding, which is only a temporary, non-sustainable revenue source, could hardly be considered a "viable" budget solution.

Rep. Bryon Short would also like us to commend the governor for taking the bold step to reduce state employees' salaries. Let us not forget that the governor's original proposal called for an 8 percent reduction in pay for all state employees. This, combined with a 50 percent increase to state employees' health care benefits, would have likely resulted in a considerable hardship for most people in these tough economic conditions. While House Republicans agreed that state government costs had to be reduced, we also understood what kind of significant impact an 8 percent pay cut would have had on state employees and their families, especially if we cut their base pay.

Again, had House Republicans sat back and approved what the governor originally proposed -- and what Rep. Bryon Short would likely view as an administration "accomplishment" -- without insisting that state employees be furloughed, we would have also negatively affected state employees' retirement income -- something none of our caucus members were willing to impose on employees for all their years of state government service. After much pressure from House Republicans, though, that pay cut was reduced to 2.5 percent by instituting 5 mandated furlough days. Nearly $30 million is to be saved with the pay reduction, while keeping intact employees' base salary.

In terms of reducing the size of state government, it wasn't until after House Republicans put a lot of pressure on the governor that significant progress was made. While Rep. Bryon Short and his Democratic colleagues remained on the sidelines, we were able to convince the Markell administration to agree to reduce the size of the state work force via attrition in the upcoming budget by about 525 positions. Combined with the number of vacant jobs eliminated by state budget writers this past session, Delaware will have 1,000 fewer state jobs by the start of the next fiscal year in July. More needs to be done, though, in the way of making state government smaller and more efficient. You can be certain that our efforts to reorganize and reduce the size of government will continue into next session.

A point of clarification must also be made on our PIT proposal. Unfortunately, Rep. Bryon Short mischaracterized our proposal, leaving out a couple of important facts, namely that our proposal was a modified version of the governor's original plan to raise the PIT. Our PIT proposal was part of a comprehensive, alternative plan aimed at keeping the number of tax increases to a minimum and making sure any tax increase was only temporary, sunsetting after three years.

As Rep. Bryon Short -- a member of the House's ad-hoc Small Business Caucus -- stated, a constructive dialogue is what is needed to solve our state's financial problems. We certainly agree. But, unfortunately, Rep. Bryon Short's criticisms may have done more harm than good when it comes to advancing the agenda of the group and advocating for small businesses in Delaware. In any case, talk is cheap when it comes to making the right choices for our constituents and the taxpayers of Delaware. Our votes speak for themselves. Can Rep. Bryon Short say the same?

Richard C. Cathcart is the state House minority leader and Rep. Daniel B. Short is House minority whip.

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