In The News

Delaware poultry worker files federal charges against local union, claiming violations

From The News Journal

An employee at a southern Delaware chicken plant has filed federal charges against the workers’ union representative, claiming “union officials are violating his and his coworkers’ rights by seizing union fees.”

Oscar Cruz Sosa, an employee at Mountaire Farms’ poultry processing plant in Selbyville, has filed federal charges with the National Labor Relations Board against the United Food and Commercial Workers (UFCW) Local 27 union for threats and other violations of federal law, according to a press release issued Tuesday by the National Right to Work Foundation.

Sosa said the union seized union fees “under an unlawful forced dues provision in the union contract,” according to the release.

Sosa’s charges also allege that a union official visited Sosa at his home in March and threatened him for submitting a petition seeking a vote to remove the union from his workplace.

The charges come after a debate over decertification of the union, which union officials previously said represents about 800 employees at Allen Harim’s processing plant in Harbeson and 1,000 at Mountaire Farms’ processing plant in Selbyville. The local union also represents workers in other industries throughout the state.

Union spokesman Jonathan Williams said Mountaire Farms and the anti-union National Right to Work Foundation are behind that effort, but that the union’s current focus is on the safety of its members inside the facility.

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Delaware’s Labor Secretary warns unemployment taxes after COVID-19 could hinder recovery

From WDEL

Delaware Department of Labor Secretary Cerron Cade said Delaware could be providing over $50 million a week in benefits soon, and the bill that will be due afterwards could hurt economic recovery.

Speaking during a Facebook Live Listening Session on Monday, Cade said Delaware has handed out around $30 million in unemployment benefits in each of the past two weeks, and that number could rise as more groups become eligible to file for unemployment during the pandemic.

Cade said they’ve applied for a loan from the federal government to help and also are getting relief from the federal CARES Act.

“The [total] number could be $850 million over the next three months alone. But more realistically, the state’s share of that will probably be a little bit less, in terms of what we’re going to have to figure out and handle, but it’s going to be a big number.”

Whatever the final cost to the state ends up being, Sec. Cade said one issue is going to be refreshing that fund, which could come in the form of higher unemployment taxes as businesses will be trying to land on their feet after some have been hindered or closed for weeks and months.

“If the state and federal government don’t figure out how to address that number across the states–not just in Delaware–you’re going to see a lot of businesses and non-profit organizations struggle to pay unemployment taxes and struggle to hire people as we try to dig out of this hole.”

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University of Delaware faces multimillion-dollar budget shortfall as coronavirus slashes revenue

From The News Journal

Unexpected costs from the switch to online learning, along with revenue losses from closing campus and canceling events, have the University of Delaware figuring out how to overcome a $65 million budget shortfall, UD President Dennis Assanis said in an email Monday.

The economic downturn that has accompanied the coronavirus pandemic has affected universities across the country.

Since closing campus in early March, the school has seen a significant revenue loss after having to refund prorated housing, dining and parking fees. Early in the semester, travel restrictions reduced tuition revenue from international students. Canceled events and athletic programs have cut off expected revenue streams as well.

Federal stimulus funds, as well as cost-saving measures like closing dorms and academic buildings, have helped push the loss from $65 million to $50 million, said university spokesperson Andrea Boyle.

But in an effort to “tighten our belts,” she said, the university has also rolled out a number of other budgetary measures — namely, a hiring freeze that could impact the university’s approximately 850 adjunct faculty members.

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How will local leaders across Delaware respond to big budget gaps in wake of coronavirus?

From The News Journal

The effects of a coronavirus-driven economic crisis that is causing more than a half-billion-dollar hit to the state’s revenues will surely soon be felt in the pocketbooks of cities across Delaware, local officials said.

From lost parking revenue at Rehoboth Beach to utility payments that will never come from now-empty Newark college apartments, city, county and town leaders will face the possibility of cutting services or even the salaries of city workers.

Some, like New Castle County Executive Matt Meyer, say now is the time to keep people employed and even hire more, whether that means taking on debt or draining rainy day funds.

But others, like Wilmington Mayor Mike Purzycki, aren’t ready to make that jump.

Already in Wilmington, officials are combing through their proposed budgets for the fiscal year that starts July, looking to cut expenses as the likelihood of layoffs looms.

Among the first items on the chopping block are uniforms and equipment for next year’s Fire Department recruits, a chunk of the Police Department’s 20 planned new security cameras, college scholarships awarded by the Mayor’s Office and the grants of a few thousand dollars that it gives annually to sustain community nonprofits, officials said during ongoing budget hearings before the City Council this month.

“There’s a possibility that it’s going to impact everybody,” Purzycki said.

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Carney outlines criteria Delaware needs to meet to reopen economy

From Delaware State News

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Revenue losses could mean budget cuts, Delaware seeks more leeway from federal government

From The News Journal

Delaware’s state revenue forecast continues to plummet, and officials warn that they could have to make cuts to government programs if they can’t more freely spend the federal aid they received from Congress to fight the pandemic.

The state expects a $784.5 million decline in revenue over the next two fiscal years, based on the latest estimates reported on Monday by the Delaware Economic and Financial Advisory Council.

Much of that money had already been squared away in the governor’s spending plan for next fiscal year, which officials now expect to drastically rework.

The latest forecast could get more or less grim before the state finishes out this fiscal year. Lawmakers, who postponed the legislative session indefinitely in mid-March, have to pass a budget for the next fiscal year by June 30.

The forecast includes a $150 million hole in the budget that officials will have to find a way to fill before the end of this fiscal year, said Office of Management and Budget Director Mike Jackson. The state could dip into its reserves or postpone capital projects that haven’t started yet, he said.

“But if it gets worse, our measures will be stronger,” Jackson said, without offering specifics.

In Pennsylvania, about 9,000 state workers stopped getting paychecks earlier this month after their offices were closed amid the pandemic.

“All options are going to be on the table,” said Jackson, adding that Delaware is in a better financial position than other states because of its reserves. “What they (other states) may employ as a strategy to cope with fiscal challenges, we may not employ.”

When asked about potential pay cuts in Delaware, Carney said during a Tuesday press conference, “Our focus will be on protecting our state employees. … But we’re going to have to take whatever measures are necessary, obviously, to close the gap.”

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Delaware FY 2020 revenue downgraded by $400M amid crisis

From Delaware Business Times

DOVER – State fiscal analysts released their first look at the coronavirus’s economic impact on Delaware on Monday, when they estimated that the current fiscal year has taken a $416 million hit so far, now leaving a deficit of about $784.5 million in the governor’s nfe

With estimated general fund revenue of about $4.32 billion, the state would face a deficit of $150 million heading into next fiscal year – a stark turn from December when the Delaware Economic and Financial Advisory Council (DEFAC) estimated that the state would enjoy a $246 million surplus at the end of the year.

How that deficit is closed isn’t something that DEFAC, a non-partisan group of business and community leaders, academics, and government professionals that sets the state’s official revenue estimates, is tasked to consider, but the state does have reserve funds in tow for such an emergency. The larger question will be how the state contends with an expected downturn in revenues through next fiscal year, which runs July 1, 2020, to June 30, 2021.

Read more:

https://delawarebusinesstimes.com/news/budget-downgrade/

State House, Senate leaders seek flexibility in using $1.2 billion in federal coronavirus funds

From Delaware Business Now

Delaware State House and Senate leaders from both parties are asking the state’s Congressional Delegation for help in getting more flexibility in using more than $1 billion in federal  coronavirus aid.

The authors of the letter noted that money from the  Coronavirus Aid, Relief and Economic Security (CARES) Act provides $150 billion directly to states, territories, tribes and localities to combat the public health and economic effects of the COVID-19 pandemic.

Delaware is expected to receive approximately $1.25 billion under the omnibus measure. The funds will be transferred to states during the next two weeks.

“The CARES Act provides vital funding, but it restricts the money to unbudgeted expenses related to COVID-19. It cannot be used to address states’ revenue losses. This is far too restrictive for states like Delaware to effectively apply the federal funds. Being able to use these dollars to shore up Delaware’s operating budget is critical to maintaining services and recovering from this unprecedented crisis,” the letter stated.

Read more:

https://delawarebusinessnow.com/2020/04/state-house-senate-leaders-seek-flexibility-in-using-1-2-billion-in-federal-coronavirus-funds/

Carney tells nonprofits there may be loss of $500 million to $1 billion in state revenue

From The News Journal

Gov. John Carney told leaders of Delaware’s nonprofits Thursday that with so many businesses closed, the state may lose $500 million to $1 billion in state revenue.

Because of that, he said he can’t be sure what will happen with the state budget.

Carney and Lt. Gov. Bethany Hall-Long fielded questions from nonprofits during a virtual town hall focusing on the effects of the coronavirus pandemic. It was organized by the Delaware Alliance for Nonprofit Advancement.

One of the questions asked was what they could expect in the 2021 budget, particularly as it applies to bond funding and the grants-in-aid that keep many of them afloat.

Carney said that picture is not yet clear. The state normally would be getting a lot of revenue from casinos and other businesses now ordered shut to slow the spread of the coronavirus.

Because of that, there could be $500 million to $1 billion in lost revenue.

He said he hopes the Legislature can come together to create a budget by June 30. He also noted that federal stimulus money cannot be used to make up for that lost revenue.

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Rob Martinelli: Let’s balance protecting public health with jump-starting our economy

From Delaware Business Times

I’ve watched Governor Carney’s press conferences about Delaware’s response to the coronavirus COVID-19. The Governor and public health officials are doing a professional job of talking about the trends and letting us know where Delaware stands. They fear that the next two weeks will be frightening in terms of positive cases and are working to preserve the necessary capacity at hospitals for the sickest patients.

The Governor admits that the forecasts in this area may be conservative. He credits working with hospitals and says, “they’ve had great ideas…This has been a great partnership.”

All Delawareans are thankful for the heroic efforts of our health care workers and first responders. We are also thankful for the type of partnership and cooperation with the health community that the Governor mentions that exists to fight this pandemic.

This column was originally going to focus on the need for a similar level of cooperation and partnership to finding finding a way to get Delaware working again as soon as possible. And as you probably read on our website, we learned just before going to press that that’s beginning to happen.

There are some who agree with New Castle County Executive Matt Meyer, who has made the argument that the best way to restart our economy is to test every Delawarean who hasn’t been tested. Dr. Fauci was on the Today show April 9th and said that the antibody test would be available in large numbers within weeks.

Meyer knows that weeks of sheltering in place will do great harm to our economy. We are a small state that prides itself on getting things accomplished. If this is a viable option that can be done cost-effectively and quickly, it would be great if we could become the First State of testing.

But I’m equally heartened by the news that Doug Gramiak and Tom McGonigle – two people with a distinguished record of serving our state – have been informally asked by Governor Carney to look into ways that we might jump start our economy.

Whether it’s serendipity or part of their effort, I am hearing that business leaders across the state are building lists that will support the efforts of Gramiak and McGonigle.

Read more:

https://delawarebusinesstimes.com/news/presidents-notebook/