Del. Gov's Budget Proposal Includes Cut to Senior Citizen Tax Cr - WBOC-TV 16, Delmarvas News Leader, FOX 21 -

Del. Gov's Budget Proposal Includes Cut to Senior Citizen Tax Credit

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DOVER, Del. (WBOC) - Slashing a tax credit for senior citizens is one of the ways Delaware Gov. Jack Markell is proposing balancing the state's budget.

Markell Thursday afternoon rolled out a $3.9 billion operating budget plan for the upcoming year.

"This is a very difficult budget," Markell said.

There are no tax hikes or layoffs in Markell's proposal.

But property owners in Delaware over the age of 65 currently enjoy an at most $500 credit on their annual property tax bill. Markell says the state's population is getting older quickly, so he is asking for that credit to drop to $250. It would save the state $12.6 million this year and more in years to come.

"I realize this is a difficult proposal," said Markell. "The cost to the state, the cost to taxpayers has been significant. And if we want to continue to fund things like education, police and the like we're going to have to find some additional resources."

Part of the reason Delaware's population is getting older is it's a good place for retirees with cheap taxes. Kiplinger's Personal Finance says its one of the best states for retirees in the country.

"This credit (change) isn't going to change that," Markell said. "We are an extraordinarily affordable place to retire to."

Delaware's property owning seniors could have a strong, negative reaction to this proposal, according to House Minority Leader Rep. Danny Short, R-Seaford. And Short points out seniors are a politically engaged portion of the population.

"I kiddingly actually said to one of my colleagues, 'I think there are probably buses heading up from Sussex County to Legislative Hall today.' It's such a strong message to seniors that their exemptions are going to be cut in half."

WBOC spoke with Sussex County seniors. They were surprised by the proposal.

"If you have a mortgage or escrow, it would make your mortgage payment go up," said Doris Warner.

"The government wastes money on a lot of things. Why take this important benefit away from people who might be on the edge?" asked Kimm Nureck.

In addition to the tax credit, Markell proposed a number of other changes to balance the budget, including diverting money from the transportation trust fund and farmland and open space preservation, cuts to non-public school transportation and no pay raises for state employees.

The budget proposal does have millions for new education spending, improving substance abuse treatment in Delaware, and continuing the state's new Downtown Development District program.

Lawmakers will start looking through the budget next week.

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