Is New Castle County the Next Greece?

Democratic U.S. Senate candidate and current New Castle County Executive Chris Coons says the financial health of New Castle County is "fine".  But is it?

Let's take a look at the County's own General Cash Flow Statement, found here, or here embedded:

Starting in 2005, when Chris Coons got the keys to the County, he started out with a Available Financial Reserve balance of $112.4 Million.  In FY2005, the New Castle County government had total revenues of $142.7 Million, and total expenditures of $168.3 Million.  The budget shortfall for FY2005 was $25.6 Million and this caused the Available Financial Reserve Balance for FY2005 to drop to $86.8 Million.

In FY2006, the New Castle County government had total revenues of $155.1 Million, and total expenditures of $156.9 Million.  The budget shortfall for FY2006 was $1.8 Million and this caused the Available Financial Reserve Balance for FY2006 to drop to $85.0 Million.

In FY2007, the New Castle County government had total revenues of $153.8 Million, and total expenditures of $162.7 Million.  The budget shortfall for FY2007 was $8.9 Million and this caused the Available Financial Reserve Balance for FY2007 to drop to $76.1 Million.

In FY2008, the New Castle County government had total revenues of $164.0 Million, and total expenditures of $166.6 Million.  The budget shortfall for FY2008 was $2.6 Million and this caused the Available Financial Reserve Balance for FY2008 to drop to $73.5 Million.

In FY2009, the New Castle County government had total revenues of $144.1 Million, and total expenditures of $169.2 Million.  The budget shortfall for FY2009 was $25.1 Million and this caused the Available Financial Reserve Balance for FY2009 to drop to $48.4 Million.

In FY2010, the New Castle County government had total revenues of $167.2 Million, and total expenditures of $166.2 Million.  The budget surplus for FY2010 was $1.0 Million and this caused the Available Financial Reserve Balance for FY2005 to increase to $49.4 Million.

In FY2011, the New Castle County government projects total revenues of $161.1 Million, and total expenditures of $165.7 Million.  The budget shortfall projected for FY2011 was $4.6 Million and New Castle County government projects the Available Financial Reserve Balance for FY2011 to drop to $44.8 Million.

In FY2012, the New Castle County government projects total revenues of $164.3 Million, and total expenditures of $176.3 Million.  The budget shortfall projected for FY2012 was $12.0 Million and New Castle County government projects the Available Financial Reserve Balance for FY2012 to drop to $32.8 Million.

In FY2013, the New Castle County government projects total revenues of $167.4 Million, and total expenditures of $182.3 Million.  The budget shortfall projected for FY2013 was $14.9 Million and New Castle County government projects the Available Financial Reserve Balance for FY2013 to drop to $17.9 Million.

In FY2014, the New Castle County government projects total revenues of $170.6 Million, and total expenditures of $186.4 Million.  The budget shortfall projected for FY2014 was $15.8 Million and New Castle County government projects the Available Financial Reserve Balance for FY2014 to drop to $2.1 Million.

In FY2015, the New Castle County government projects total revenues of $173.7 Million, and total expenditures of $192.9 Million.  The budget shortfall projected for FY2015 was $19.2 Million and New Castle County government projects the Available Financial Reserve Balance for FY2015 to drop to a staggering reserve loss of -$17.1 Million.

Let's take a look at this graphically in a Blue Hen Conservative created chart off of the data provided by New Castle County government:

The two descending lines of the chart represent the financial reserves.  The blue line is the beginning financial reserve balance for each Fiscal Year starting in FY2005, and ending in FY2015.  The purple line represents the ending fiscal  reserve balance.

The two ascending lines represent the reserves and expenditures.  As you see both are growing.  But despite increased revenues, expenditures outpace revenues.  Hence the budget shortfalls in FY2005-FY2009, and  and projected shortfalls in FY2011 through FY2015.

While New Castle County government may have a AAA bond rating as of October 2010, it may not for long.  Surely, New Castle County government financial reserve accounts are hemorrhaging cash at a rampant rate.  And this all considered that the county forced the taxpayers of New Castle County higher taxes in 2006, 2007 and 2009.  So what did New Castle County do with the 5% tax increase in 2006, 17.5% tax increase in 2007 and 25% tax increase in 2009?  They are spending it.  This proves that New Castle County has a spending problem, and despite Chris Coons' claims - he is not a fiscal conservative.

The only thing that is certain is the County will ask the taxpayers to pony up again because of its fiscal recklessness.  New Castle County government faces a bleak future that may also require cuts in government services just to stay afloat.