Markell Discusses FY09 Budget Request
State Treasurer Highlights Saving for College and Retirement
State Treasurer Jack Markell will make his annual budget request to the Office of Management and Budget on Tuesday, November 20, 2007 and will request a tax deduction for contributions to 529 College Investment Plans as well as an increase in the state government match for contributions by state employees to their supplemental retirement plan called Deferred Compensation.
"Families across Delaware are squeezed by higher energy prices, health care costs and college tuition," Markell said. "That's why I'm requesting that Delaware join so many other states that feature tax deductibility for contributions to college investment plans."
Markell, Chair of the Delaware College Investment Plan Board, indicated that this was the second year in a row he has requested the introduction of tax deductibility and he believes this tax advantage should apply to Delaware investors in any Section 529 college investment plan, not just participants in Delaware's plan.
In addition, Markell is again requesting that the State of Delaware Deferred Compensation Plan's match program be increased from $10 per pay cycle to $20. The Deferred Compensation Plan has grown to 13,067 participants, which is an increase of almost 17% over last year's total of 11,200 participants.
"It's important that state employees be encouraged to save as much as they can for their retirement and a small increase in the state match can go a long way," Markell said.
Some highlights from the Office of the State Treasurer that Markell will outline are:
- The State's Deferred Compensation Plan has increased its participants by almost a 17% increase over last year, and has grown to more than 13, 067 participants who have contributed more than $1.3 million during each pay cycle, bringing the total amount that state employees have saved toward their retirement to $335 million, and almost $20 million assets of the state employees' Deferred Compensation Plan Match accounts.
- The Delaware College Investment Plan continues to grow and has increased from 24,000 accounts with assets of $320 million to almost 25,800 accounts with assets of over $408 million in savings for higher education expenses.
- The Office of State Treasurer continues to collaborate closely with the State Auditor's Office and Attorney General's Office to combat new types of fraud. All reports of fraudulent checks or other activities that are reported to the State Treasurer's Office are forwarded to the Attorney General's Office and / or the State Auditor's Office for review. For the third year, the Office has again partnered with the United States Department of Treasurer to promote the "Go Direct" program that encourages social security recipients to utilize direct deposit as a means to prevent check fraud and identity theft.
- The Treasury Operations again this year maintains a record of no new audit findings in the reconciliation area, and is continuing to expand the state's Automated Clearing House (ACH) program for state vendor payments. Currently, over 3,000 vendors are paid by ACH, with $2.3 billion in payments. Working closely with the state's disbursement bank, PNC, the Office continues to develop a comprehensive payables strategy that promotes the use of the state Purchasing Card in conjunction with ACH and check payment. With this contract up for bid in the end of 2008, the Office of State Treasurer will continue to explore new uses of technology for payments and disbursements and consider all cost saving technology initiatives that may be of benefit to the state and its customers. The Cash Management Unit (CMU) of the State Treasurer's office continues to promote the partnership that the Office has with the Export Import Bank of the United States. In addition to completing staff training, the CMU has conducted a major statewide mailing to Delaware businesses that may benefit from financial assistance to sell their goods in foreign countries. The Debt Management Unit continues smooth operation in the wake of growing volume of debt instruments and Special Funds. The unit paid out over $168.2 million in Debt Service, collected over $45 million from schools to repay their local share debt, and calculated and paid interest on over 457 state Special Funds.
- The Office of State Treasurer's education and financial literacy efforts has continued to expand and assist Delawareans. In August 2007, the Office released Delaware Facing Forward - A look at Delaware's Demographic Future. Public policy groups, non-profits, service providers, education organizations and citizens across Delaware have utilized this report as an tool to help them better understand and focus on the impact of Delaware's aging and shifting population. The Office also sees considerable interest in it's Consumer Tool Chest - Financial Security Tools for Seniors which the Office produced to assist Delawareans age 50+ manage the many financial challenges unique to their population. The free women's financial education program, From Purses to Portfolios continues to flourish statewide, and the 3rd Annual Treasurer's Summit for high-school students will again provide a lasting impact on hundreds of Delaware youth. Continuing the partnership with financial professionals throughout Delaware, the Delaware Money School presents hundreds of classes free to attendees throughout the Delaware. The Treasurer's Office also continues to partner with the Delaware State Chamber of Commerce and University of Delaware, Center for Economic Education to present the Bank at School program that operates in elementary and secondary schools to teach the basics of banking to students.
###
