With 25 votes needed to pass, House Bill 255 with HA 2 & HA 3 crafted to address the projected budget shortfall passed in the House with 26 yes votes, 13 voting no and two absent. The 26 who voted yes were all Democrat legislators. HB 255 now heads to the Senate for consideration. Although unconfirmed, it is believed the upper chamber will convene next week to consider the bill.
Additional Information from Legislative Hall (11-13-25)
The House passed legislation Thursday that would immediately address a projected $400 million budget shortfall caused by recent federal tax code changes under the “One Big Beautiful Bill Act” (OBBBA).
Sponsored by Rep. Kerri Evelyn Harris and Sen. Bryan Townsend, House Bill 255 would decouple Delaware’s tax code from certain provisions of the federal Internal Revenue Code (IRC) and reverse the automatic adoption of costly corporate giveaways that would drain hundreds of millions from the state’s budget over the next three years.
“Every day, Delawareans are struggling to pay for housing, fill their gas tanks, afford a doctor’s visit, or buy their prescriptions. Instead of focusing on those real challenges, Washington Republicans passed a tax plan that gives more to the wealthy and big corporations while working people are left footing the bill,” said Rep. Kerri Evelyn Harris
“We can – and do – absolutely support the many businesses and business owners who call Delaware home, but we have to do so in a responsible way, not by destabilizing our budget and giving away millions of tax dollars that have already been allocated to support schools, public safety, and services that our communities rely on. Temporarily decoupling is the right thing to do and I appreciate my colleagues for taking this step today to protect our state.”
Delaware is a rolling conformity state, meaning our tax code automatically incorporates most changes to federal tax law unless the state specifically “decouples” from them.
In July, Congress passed the OBBBA, which made significant changes to the federal tax code, including the timing of when businesses can deduct certain expenses. Under the new law, companies can immediately write off the full cost of research, experimental activities, and certain property investments, rather than spreading those deductions over multiple years as was previously required.
These changes, some of which are retroactive for businesses beginning in tax year 2022 and for all taxpayers in 2025, would result in a major loss of state revenue. Without legislative action, the state stands to lose $222.8 million in fiscal year 2026, $107.4 million in fiscal year 2027, and $79.9 million in fiscal year 2028.
HB 255 would protect Delaware from this revenue loss and preserve the state’s financial stability by temporarily decoupling from these provisions.
Importantly, HB 255 does not eliminate depreciation or business expensing. Businesses can still claim these deductions, but the bill adjusts the timing so they are spread out over multiple years, as was the case before the OBBBA, rather than allowing corporations to take a massive, immediate tax break.
Delaware’s approach aligns with what many other states have already done. Over the past 25 years, most states have selectively decoupled from certain federal tax provisions to protect their budget. For example, 28 states had decoupled from bonus depreciation even before the OBBBA was enacted.
Additionally, HB 255 does not impact small business expensing, meaning that small businesses can still immediately deduct up to $2.5 million in qualifying equipment and property purchases each year.
An amendment passed with the bill would require the Department of Finance to report to the Delaware Economic and Financial Advisory Council (DEFAC) in December 2027 on the bill’s revenue impact, federal law updates, and recommendations for future tax policy.
Today’s Vote in the House:
Needing a minimum of 25 votes to pass, the measure garnered 26 “yes” votes, all of which were from members of the House Democratic Caucus. The final tally was 26 “yes,” 13 “no,” and two absent. The leadership of the Senate chose not to bring their members to Legislative Hall today, despite being called back into extraordinary session by the governor. Although unconfirmed, it is believed the upper chamber will convene next week to consider the bill.
Among the disagreements regarding the Extraordinary session had to do with the level of urgency of the situation…
That was State Representative Valerie Jones Giltner with her comments and question. David Roose, Director of Research for the Department of Finance in response to that noted that the effects are now being felt through the estimated payments received for the third quarter. He added that economic indicators offered no clear reason for the 20% drop in those payments.
Statement from the House Republican Caucus on the Passage of House Bill 255
“Less than eight months ago, the Delaware General Assembly enacted legislation to reform Delaware corporate law and restore predictability to the adjudication of cases coming before the Chancery Court.
This was a reaction to companies, including SpaceX, Tripadvisor, Dropbox, Andreessen Horowitz, The Trade Desk, Neuralink, and many others, announcing plans to leave Delaware and incorporate elsewhere.
The First State’s long-standing status as a destination for incorporations has reaped enormous benefits. Corporate franchise taxes, business entity fees, corporate income tax, and escheat (abandoned) property provide more than a third of our revenues. Those figures are measured in the billions of dollars and are a fixture of our state’s financial foundation.
By contrast, House Bill 255 will make permanent changes to our state’s business tax code to deal with a fleeting situation and a comparatively modest amount of revenue. This legislation is not only a sharp break with historical precedent, but by decoupling our tax code from aspects of federal law, we are denying Delaware businesses incentives for facilitating research & development and the purchase of new equipment.
Enacting HB 255 will make our state less attractive for developing domestic enterprises and give corporate leaders who are uncertain about retaining their presence here another reason to relocate.
Just yesterday (11/12), Coinbase announced it was leaving Delaware to reincorporate in Texas. The company’s chief legal officer cited Delaware’s unpredictable business climate as the top reason for the company’s decision.
Meeting in an extraordinary session and changing our House Rules to allow remote voting solely to ensure the passage of House Bill 255 will do nothing but confirm that Delaware is now a volatile business venue. Enacting this measure is a fool’s bargain that trades short-term monetary gains for long-term financial stability and an uncertain future.”
Previous Posts:
House Substitute 1 for House Resolution 19,
Updated 11:30 a.m. –11/13/25:
The Delaware House has voted on House Substitute 1 for House Resolution 19, which would allow virtual participation in special sessions with the Speaker’s authorization and a quorum of the House physically present in Dover. In this morning’s Special Session, the roll call revealed 22 yes votes and 15 no votes (along with one not voting and three absent). Therefore, the resolution has passed. Several representatives raised concerns about the integrity of the voting process and the essential nature of the legislative sessions and their oaths to constituents, while one of the legislative attorneys explained the Chamber’s discretion in setting its rules.
House Passes Bill To Extend New Castle County Property Tax Payment Deadline
Additional Information from Legislative Hall — 11/13/25:
During a special session Thursday morning, the House voted to pass legislation to extend the deadline for payment of property tax bills in New Castle County for the 2025-2026 tax year to December 31, 2025.
Sponsored by Sen. Jack Walsh and Rep. Kim Williams, Senate Bill 206 is a necessary follow-up to House Bill 242 – legislation passed in August that allowed school districts to set different tax rates for residential and non-residential properties, a change that resulted in lower bills for many homeowners followingwidespread reports that non-residential properties were underassessed, while residential properties were overassessed in New Castle County.
HB 242 originally extended the tax payment deadline to November 30 to account for the time needed to reissue bills.
The legislation was challenged in the Court of Chancery, putting a pause on it going into effect.
On October 30, the Court of Chancery upheld the terms of House Bill 242, leaving only one month left for bills to be reissued and paid by residents if the November 30 deadline remained in place. The Supreme Court upheld an appeal to this decision earlier this week, affirming the terms of HB 242.
Due to the delay in reissuing bills caused by the lawsuit, lawmakers introduced SB 206. This legislation closes the loop on this issue by allowing residents to have until the end of the calendar year to pay their bills.
“Over the last several months, we’ve been working closely with stakeholders to provide meaningful relief to our constituents who found themselves facing extraordinarily high tax bills following the recent property reassessment,” said Rep. Kim Williams, House Prime Sponsor of SB 206.
“SB 206 is the final step in our short-term efforts to ensure that this initial reassessment, the first one for our county over 40 years, does not have drastic effects on our neighbors. At the county’s request, this bill extends the property tax payment deadline to the end of the year, giving homeowners more time and flexibility to review their bills. This would provide residents the opportunity to seek further information and assistance regarding revised amounts, refunds and payment plans.”
“After a reassessment process that left many New Castle County residents facing unexpected bills, it’s only right that we give taxpayers more time and clarity to plan and pay. Senate Bill 206 rightfully achieves that by extending the county’s property tax payment deadline,” said Sen. Jack Walsh, Senate Prime Sponsor of SB 206.
“I am thankful the House sent this legislation to the Governor’s desk, as it will give taxpayers much needed relief as they continue to navigate this process. This extension is about fairness and serves as a reminder that the state is listening and acting in taxpayers’ best interest.”
SB 206 now heads to the governor’s desk.
Extraordinary Session Ongoing:
The Extraordinary Session as called by Governor Meyer has been ongoing this afternoon. House Bill 255 addresses concerns about the
the projected budget shortfall, which state officials attribute to the effects of the federal One Big Beautiful Bill Act (OBBBA).
The sponsor of the Bill–House Majority Leader and State Representative Kerri Evelyn Harris discussed the reason for the bill…
The discussion has centered on two primary points, in which there has been disagreement: the need for the extraordinary session as
well as the level of urgency suggested by the latest projections released by the Delaware Economic and Financial Advisory Council
(DEFAC).
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Legislation Introduced on 11/12/25:
House Amendment 1 to House Bill 255
This amendment adds a sunset for the changes to bonus depreciation in House Bill No. 255 and requires the Department of Finance to present a report regarding the actual revenue impact of this bill, as well as updates on federal law and recommendations for future tax policy at the December 2027 DEFAC meeting. The decoupling from §§ 70301 and 70307, P.L. 119-21, will sunset after the 2030 tax year. This is when the provisions of P.L. 119-21 for qualified production property are scheduled to expire under federal law. Property placed in service during the decoupling period will continue to be treated under the same schedules for depreciation after the decoupling sunsets. Property placed in service thereafter shall be treated under the then-current federal law. The research and development changes in House Bill No. 255 apply only to the 2022 through 2025 tax years, so there is no need to sunset them.
Amendment is attached to the legislation and awaits consideration.
A special session and an extraordinary session will take place today, Thursday, November 13th. Speaker of the House, Melissa Minor-Brown says the House will convene at 10am for a special session to consider Senate Bill 206, which would extend the property tax payment deadline for New Castle County. The House will also vote on House Substitute 1 for House Resolution 19 which would allow virtual participation in special sessions with the Speaker’s authorization and a quorum of the House physically present in Dover.
The Extraordinary session begins at noon as called by Governor Meyer. House Bill 255, to address the projected budget shortfall, will be considered.
State Representative Valerie Jones-Giltner was on the Talk of Delmarva’s Mike Bradley program this morning and discussed the difference between a special session and an extraordinary session.
State Representative Brian Pettyjohn had previously explained that “special” sessions called by the governor are technically extraordinary sessions, if you look at the language in the proclamations. But what he said was highly unusual is for the governor to call an extraordinary session of the General Assembly.
Here is the segment on the Talk of Delmarva’s Mike Bradley program–with Rep. Valerie Jones-Giltner…
