Delaware governor plans to cap growth in next state budget

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Delaware Gov. Matt Meyer is promising to constrain spending growth in the next state budget to less than 5%.

Meyer announced his intention to cap spending in Thursday’s State of the State speech in front of a joint session of the General Assembly in Dover. In his remarks, he highlighted several other priorities for this legislative session that focused on affordability and government efficiency.

“Over the past year, we have faced challenges, tragedy and unprecedented uncertainty, but I am here to report to you that despite this, the state of our state is strong,” he said.

State budget growth has risen year-over-year

The General Assembly’s 2026 budget was about $6.5 billion, a 7.3% increase from the prior year. That operating budget for fiscal year 2025 totaled $6.1 billion, which was a 9.3% increase from the previous year’s budget.

Speaking to reporters after the speech, Meyer said he will give more details about how he plans to reduce the growth of spending in his budget speech on Jan. 29.

“Of course, that’s only one side of the ledger,” he said. “You’re going to also hear about the revenue side next week. You’re going to see a smaller gap between revenues the state’s taking in and expenditures and our projected budget than you’ve seen in years.”

Republican House Minority Whip Jeff Spiegelman, who represents Clayton, said he welcomed Meyer’s pledge to hold back on spending growth, something he and other Republican lawmakers have complained about for years.

“We’ve been calling for that for 14 years,” he said. “Just in the last six years, we’ve grown 50%. So for him to keep budgetary growth under 5% — I mean, that’s still above inflation — but that would be great.”

The governor did not mention any efforts to reform the state’s personal income tax brackets, which he made a priority last year. State lawmakers did not take action on that.

Under the state’s current income tax system, Delawareans making more than $60,000 a year pay a 6.6% tax rate on earnings above $60,000, which is the state’s top rate. Meyer proposed last year making the new brackets with increased tax rates for income over $125,000, $250,000 and $500,000. However, he struggled to get buy-in from key legislators, including House Speaker Melissa “Mimi” Brown.

The governor said after the speech that he still supports changing personal income tax brackets.

State Rep. Madinah Wilson-Anton, D-Newark, said she was disappointed he didn’t highlight the issue in his speech.

“He did talk about the corporate franchise, which is a big part of our revenue stream, but income tax bracket reform is long overdue, and there was a lot of drama about that last year, so interesting that that wasn’t mentioned today,” she said.