The Republican leader in the Delaware House of Representatives said this afternoon that the chamber will likely vote this evening on a compromise package of tax increases that will set the stage for the passage tomorrow of the state’s 2010 budget.
Minority Leader Rep. Richard C. Cathcart, R-Middletown, said his party has reached an agreement with House Democrats and the administration that advances Republican plan to save $13.7 million in state personnel costs by eliminating non-essential positions as they become vacant.
Cathcart said the savings will be used to scale back plans to increase the state’s personal income taxes, gross receipts taxes and corporate franchise taxes.
Most of the relief will be applied to the income tax hikes, which, Cathcart said, likely will land somewhere between a proposal put forward by Gov. Jack Markell and a more aggressive package of increases developed by House Democrats.
“We don’t like taxes, but we realize you can’t cut your way out of an $800 million shortfall,” Cathcart said.
As part the compromise, Cathcart’s party also will be allowed to attach so-called sunset amendments to each of the tax bills. A sunset amendment essentially places an expiration date on a piece of legislation, after which the General Assembly must vote to renew the law.
Both parties will spend most of the late afternoon discussing the specifics of the compromise plan in their respective caucuses.
Though the House Republicans succeeded earlier this month in delaying several tax bills on the floor, the minority leader said that since an agreement has been reached on attrition and sunsets, his caucus now will support the tax increases.
“I have a lot of confidence that our caucus will accept [the taxes],” he said. “With the principles of what we wanted to get done, this is well within those parameters.”
In addition to personal income, gross receipts and corporate tax hikes, alcohol, cigarette and public utility tax increases also are up for consideration, as well as a bill that would reinstate Delaware’s estate tax.
Cathcart said negotiations continue regarding the possibility of furloughs for state employees, but that he thinks the rest of the budget process should go smoothly.
“If we get these money bills passed tonight, we can go ahead and pass the budget,” he said. “We’re pretty much over the hump.”
A draft budget bill prepared by the Joint Finance Committee was introduced this afternoon. The General Assembly must pass a final version of the bill by Wednesday, July 1.
Email Doug Denison at doug.denison@doverpost.com.
