- Associated Press - Thursday, June 26, 2014

DOVER, Del. (AP) - The legislature’s finance committee has agreed on a $45 million package of grants for community organizations, volunteer fire companies and nonprofit groups.

The grant-in-aid package, which now goes to the Senate for an initial floor vote, was released by the joint finance committee on Thursday.

The grants package is one of three budget bills, along with the operating budget and capital budget, that lawmakers must approve each year.

The state House on Wednesday gave final approval to a $3.8 billion operating budget for the fiscal year starting Tuesday, an increase of 2.4 percent over the current year’s budget.

The operating budget includes a $500 pay increase for most state employees effective Jan. 1. Overall personnel costs, including pension contributions and adjustments to teacher pay, would increase by about $22 million over the current year. The budget also increases spending on Medicaid by about $30 million and boosts public school spending by about $50 million.

Lawmakers agreed with Gov. Jack Markell to balance the budget by increasing the annual tax on limited liability companies and business partnerships, and raising the minimum annual corporation franchise tax. The tax increases are expected to generate an additional $51 million next year. Lawmakers also went along with Markell’s proposal to use $40 million in funds that had been designated for road projects to pay for operating expenses.

The capital budget committee has recommended a $421 million spending plan for road and construction projects, down from the $477 million authorization for this year. That bill is awaiting an initial House vote.

Markell had proposed raising Delaware’s gas tax by 10 cents a gallon to boost spending on road and transportation projects by $100 million annually over five years, but lawmakers balked at the election-year proposal.

The administration subsequently decided, with lawmakers’ blessings, to raise weekend tolls on State Route 1 and borrow an additional $20 million annually to pay for road paving.

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