Wilmington council passes budget with fewer cuts than feared, for now

Wilmington council members narrowly passed an amended $163 million city budget Thursday that makes some cuts in light of projected revenue shortfalls, but avoids city worker layoffs.

The Police Department will install and monitor 10 new security cameras around the city instead of the originally proposed 20. 

The Parks Department won't hire as many summer camp and seasonal staff members.

Mayor Mike Purzycki's office will give out less in grant funds to local nonprofits and events. 

Those and other administrative cuts amount to a $5.7 million reduction from the budget that was proposed in March for the fiscal year that starts in July. 

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The reductions are less than originally anticipated, though officials stress the economic outlook is still uncertain.

When the coronavirus pandemic hit Delaware two months ago, it upended what would have been modest, stable growth in the city's finances going into the next fiscal year.

City officials feared the worst — that record numbers of unemployment and widespread business closures would lead to a bigger budget hole than Wilmington had the reserves to plug. 

Instead, they won't be accessing the city's emergency $17 million in rainy day funds, which would have required a supermajority of the City Council's approval. There is no tax or water rate hike for residents in the budget.

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The city is ending this fiscal year $9 million short on projected revenues.

A city financial panel estimates Wilmington will receive $13.6 million less in revenues next fiscal year than projected before the pandemic began. The bulk of that will be lost because of lower wage taxes and net profits taxes on business. 

The projection is based on an economic model that assumes a slow recovery beginning in late summer. 

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Along with the cuts, officials will use $5.4 million in reserves that haven't been accessed in eight years to cover the shortfall. 

City Council Finance Committee Chair Bud Freel said he expects the council to revisit the budget in the fall after officials get a clearer picture of how many residents are able to pay property tax, which usually is received in August and make up a quarter of city revenues.

Freel, who is retiring at the end of this term after 23 years on the City Council, said he's never seen a budget "with so many uncertainties."

Several council members said they hope to push for more security cameras when the budget is reworked.

"The crime is still going on and unfortunately it may get worse as people get more desperate," 1st District Councilwoman Linda Gray said.

More than $2 million of the cuts come from the city expecting to save on employees' health care costs, based on projections from the city's insurance broker, officials said.

The rest are from the elimination of certain vacant positions and consultants and reductions in maintenance and software costs.

Opposing the budget were council members who criticized the administration for not including funding for the police department to adopt body cameras.

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Council members and community activists have demanded the equipment but the Purzycki administration has avoided funding the multimillion-dollar program by applying for a federal grant to help pay for it. The grant was rejected last year, and the Police Department is reapplying this year.

"Your budget reflects what you care about," Councilman Sam Guy said.

Seventh District Councilman Chris Johnson said those interests will have to be balanced against other needs during the coronavirus crisis, such as emergency shelter and support for small businesses.

Jeanne Kuang covers Wilmington for The News Journal. Contact her at jkuang@delawareonline.com or (302) 324-2476. Follow her on Twitter at @JeanneKuang.