New Castle, DE – New Castle County Executive Matthew Meyer today announced spending reductions that are a first step to addressing a budget deficit that is projected to increase in the years ahead. After the November election, Meyer and his leadership team initiated a review of key county financial data, cost drivers and other expenses to fully understand the ability to meet short- and long-term financial obligations. While that review is ongoing, it has already identified a structural deficit of more than five million dollars in the current year operating budget and revealed a trend of projected budget deficits that will grow to more than $25 million by 2020. See financial projections summary attached below.
“When I ran for office I promised a county government that is more transparent and responsive and that we could do more with less," Meyer said. “That’s why I’m communicating early to our residents, county employees and other stakeholders about the fiscal challenges we face this year and beyond. New Castle County families cannot spend more than they bring in, and neither can our government. County expenses are exceeding revenues so we are acting responsibly by immediately taking several preliminary steps to reduce spending.”The five cost containment strategies Meyer announced today include:
County government expenses have exceeded revenues for the past four fiscal years, and in the current fiscal year. That structural imbalance is expected to increase over the next three fiscal years with expenses growing by $29 million or 4.8% annually, more than three times the rate of revenue growth which is projected to increase by $8 million or 1.5% annually. The cost containment strategies announced today are expected to reduce, but not eliminate the current-year budget deficit and will not on their own balance future projected budget deficits.
“My team and I will continue to work diligently to identify efficiencies and other cost reductions to restore fiscal discipline and will consult closely with County Council and others to consider the difficult choices we face to align expenditures with revenues in the years ahead,” Meyer said.
Contact: Jason Miller, 302-545-1462