Delaware Senate Unanimously Passes FY 27 Budget Bills

June 19, 2026/Joe Ciccanti

The Delaware Senate has voted to approve a $6.99 billion operating budget for Fiscal Year 2027, which includes funding for state employee and retiree compensation, public schools, healthcare services, public safety programs, and other statewide operations. The budget provides a 3% raise for state employees and additional pay increases for educators, while also supporting state retirees through pension and healthcare investments. Major spending increases are directed toward Medicaid services, developmental disability programs, child care assistance, and public education, including the restoration of $26 million for school districts and charter schools. The package also supports public safety efforts, establishes funding for the state’s new Office of the Inspector General, and maintains reserve funds while reducing long-vacant state positions and implementing targeted cost-saving measures.
 
Additional Information from Legislative Hall:
 
Senate Bill 335 is the FY 27 operating budget representing 6.3% growth, and includes the following major highlights: 
 
Investing in State Workers with Competitive Salaries and Benefits
  • $146.9 million added to provide pay policy for state employees, including:
  • For the sixth year in a row, state employees will receive a pay increase, with all merit employees receiving a 3% raise.
  • Education employees receive a minimum of a 3% raise, but teachers, nurses, etc., and non-administrator classroom staff receive additional raises as recommended by the Public Education Compensation Commission (PECC), continuing the promise toward teacher starting salaries of $60,000.
  • Salary recommendations of the 2025 Compensation Commission Report, negotiated collective bargaining unit increases, and statutory step increases are fully funded
  • Over $16.2 million added to cover the state share of state employee and state retiree health insurance premiums to ensure existing health benefits remain intact.
 
Providing Assistance to State Retirees
  • $65.8 million toward OPEB Investments, ensuring healthcare for state retirees and reducing long-term liability
  • $72 million in Post Retirement Increase Funding to fully fund a post-retirement increase for state pensioners.
  • 1% increase for those retired between June of 2021 and 2006; and
  • 2% increase for those retired prior to June 30, 2006.
  • $6 million toward a 0.25% rate of payroll to rebuild funds in the Post Retirement Increase Fund for future retiree raises.
 
Investing in Healthcare and Healthy Communities
  • $128.5 million added to cover increases in statewide Medicaid service needs.
  • $34.1 million added for health services increases in the Department of Correction.
  • $14.6 million for residential habilitation, community-based services, growth, and to clear personal attendant services waitlists to support statewide developmental disabilities services.
  • $10.5 million for Direct Support Professionals Rate Increases (McNesby Act).
  • $54 million in additional spending authority for Hospital Quality Assessments to support healthcare system sustainability.
 
Supporting Our Youngest Delawareans
  • $26.4 million invested in child care policy changes to support both Delaware families and childcare providers, bringing the total state support to Purchase of Care $107 million.
  • $600,000 in school wellness centers, kindergarten oral health screenings, additional seats in the Delaware Institute for Dental Education and Research (DIDER) program, as well as outreach services for the deaf, hard of hearing, and deaf-blind community.
 
Supporting Our Students 
  • This budget continues Delaware’s strong investment in public education with more than $2.5 billion toward the pre-k to 12 population, just over 140,000 enrolled students, including:
  • $26 million added to restore a Fiscal Year 2018 budget reduction to Division II units, allowing all districts and charters immediate financial support toward school operations. 
  • $8 million in continued Early Literacy Funding to address our youngest learners.
 
  • This budget also support higher education and workforce readiness through:
  • $5 million added for Delaware State University operations.
  • $1.5 million added for adult education and workforce training at the vocational school districts.
  • $1.2 million added for Delaware Technical Community College compensation stabilization.
 
Prioritizing the Safety of Our Law Enforcement Officers and Public Safety
  • $2.8 million added for Delaware State Policy Body-Worn Camera contract increases.
  • $2.2 million in authorization added for additional security staffing at transit facilities and DMV locations.
  • $2.4 million added to support preventative detention and bail reform implementation.
 
Strengthening Government Accountability
  • $1.3 million to fund the State’s new Office of the Inspector General.
  • Additional staff support at the Auditor of Accounts’ office to continue in-house audit engagements.
 
Paradee continued, “This budget reflects a commitment to fiscal restraint and responsibility. The Joint Finance Committee continues efforts to find efficiencies and reductions where possible.” 
 
Those efforts include:
  • Reducing vacant positions that have been vacant for greater than 3 years (37 General Fund Positions), resulting in a budget reduction of nearly $2 million.
  • Over $5 million in targeted contractual reductions/savings.
  • Maintaining a strong balance in the Stabilization Fund to ensure there is a reserve available amid federal funding uncertainty.
  • Ensuring Budget Reserve (Rainy Day) Fund is fully funded.
  • Applying additional resources toward capital project needs statewide.
The one-time supplemental budget, laid out in Senate Bill 336, includes a total of $146.2 million in one-time funding for statewide needs, including:
  • $100 million toward future education formula adjustment as the state moves toward a weighted funding formula model as recommended by the Public Education Funding Commission (PEFC).
  • $8.3 million toward upcoming primary and general elections.
  • $8 million toward the Delaware Early Childhood Care and Education Alliance. 
  • $5 million in operations support for Delaware State University
  • $3.4 million toward SAT reform efforts to modernize Delaware assessments.
  • $3 million to fund teacher driven projects – allowing teachers to request funding for classroom needs as they see fit.
  • $2 million for residential and childhood lead prevention and remediation.
  • $1.9 million toward upgrading the Department of Elections’ campaign finance system.
  • $800,000 added to supply rental vouchers to families with school-age children living in shelters and motels.
 
“With the work of the administration and our colleagues, this budget and one-time supplemental bill provides an investment for today and tomorrow. This budget represents responsible growth that will also provide funding for communities throughout our state. While we continue our efforts to make sure that our state is fiscally responsible through reducing statewide vacant positions, having targeted reductions of $5 million in contractual savings, maintaining a strong stabilization fund and budget reserve,” said Rep. Kim Williams, co-chair of the Joint Finance Committee. “The budget also provides significant investment with the updated funding formula as recommended by the Public Education Funding Commission through restoring a previous reduction of $26 million in FY’18 of Division II Units for districts and charters and $100 million in additional one-time funds. Through the funding for state employees, purchase of care, support to state retirees, and investment in crucial healthcare areas such as Direct Support Professionals Rate Increases, this budget represents smart investments for all Delawareans.”
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