Outgoing Office of Management and Budget Director Ann Visalli stands inside the Senate chamber at Legislative Hall last week. (Delaware State News/Dave Chambers )
DOVER — In January 2009, the new administration of Gov. Jack Markell entered office facing two budget imbalances. The national recession meant revenue was falling precipitously, and in Delaware, that resulted in a deficit in the current year.
On top of that, the administration was faced with creating a budget for the upcoming year, part of an annual process that had rarely been so challenging before.
Top state officials were immediately tasked with closing the gap, which grew from $600 million to more than $800 million in the spring.
“It was a hole and it got worse,” Office of Management and Budget Director Ann Visalli, appointed to the position in January 2009, said last month.
State officials cut employee pay, eliminated vacant positions, placed a hold on most government-funded travel, increased some taxes and accepted federal stimulus money, allowing them to fill the deficit with a smaller budget.
Now, more than seven years later, the Markell administration is in its final year, and the state is in a firmer financial situation.
Though elected officials say they are not looking ahead to next year, others have begun doing so. Original members of the governor’s cabinet, such as the heads of Safety and Homeland Security Department and the Labor Department, have departed, and even Gov. Markell has referred to gubernatorial candidate Rep. John Carney, D-Del., as the state’s next chief executive.
There are few clearer signs that some Delawareans are starting to prepare for life after Gov. Markell than an announcement last month that Ms. Visalli is leaving her post.
After 22 years with the state, she will move to St. Andrew’s School in Middletown this month. Her last day as head of OMB is May 13, and she will then begin as chief operating officer with the boarding school.
“I cannot thank Ann enough for her service to the citizens of Delaware and her leadership of OMB — especially during such challenging times for our state’s budget,” Gov. Markell said in a statement. “Ann has never been afraid of a challenge and she certainly has overcome many since the start of my administration, finding savings for taxpayers while maintaining key services and ensuring we have invested in the areas like education and workforce training that are vital to our success in the new economy.”
The longest-serving budget director in state history, as far as Ms. Visalli knows, she and Gov. Markell go way back.
A budget analyst with the Controller General’s Office when Mr. Markell was elected treasurer in 1998, she worked with him on the agency’s budget and soon became his deputy treasurer.
Needless to say, that 17-year partnership has been a fruitful one.
Ms. Visalli said there was no deal between the two of them for Mr. Markell to appoint her to a position in his administration should he win the 2008 gubernatorial election.
“You don’t want to jinx yourself when you’re campaigning,” she said. “It’s sort of bad karma to talk about your cabinet until after you win the election, but I felt very committed to the governor no matter what the future held for him so I wasn’t really planning my next job. My goal was just to help him succeed.”
There probably are not that many people who can disagree with the governor on a regular basis, but Ms. Visalli is one of them.
“We have a very healthy debate process. It’s kind of how we get to consensus or conclusion. I always speak my mind and he always speaks his,” she said.
But surely he wins most of those arguments, right?
“It’s probably 50-50,” Ms. Visalli said laughing. “He is the governor, so I do try to defer to him when he’s right, but he’s not always right, but we do have a very healthy process, and again, having worked for him for so long, complete trust for one another.”
A staunch defender of the administration, Ms. Visalli has been a part of some disagreements with lawmakers. Issues like employee health care have at times put the executive branch on one side and state workers and legislators on another, leading to some head-butting.
She downplays any disagreements with the General Assembly, noting it consists of 62 different members who each have their own views and priorities.
Despite spending nearly half her life — and most of her working life — with the state of Delaware, she did not anticipate being an employee in the public sector.
“I was planning to go get my Ph.D., probably be a college professor somewhere and teach economics, but when I was getting my master’s degree, both my parents passed away, so I ended up getting an internship in state government — the budget office, as a matter of fact,” said Ms. Visalli, who received bachelor’s and master’s from the University of Delaware.
As budget director, she hears pitches from state agencies in the fall and works to create a spending plan for the state, which could surpass $4 billion this year for the first time.
The governor presents his budget in January, after which it is handed over to the General Assembly. From there, lawmakers make changes as they see fit, occasionally butting heads with the executive branch.
One of the defining features of the current administration is the tight financial situation. Calling the environment “austere,” Ms. Visalli said the crunch has made it tougher to add programs or services, instead forcing officials to focus more on key components.
The challenges associated with the Great Recession have not stopped the budget from growing by $1 billion in Gov. Markell’s seven-plus years. Officials are fond of noting, however, the budget has actually shrunk when adjusted for inflation and population growth.
Delaware’s unemployment rate in 2009 was 7.2 percent, and it would grow to 8.7 percent over the next year before beginning a steady climb down. It now sits at 4.4 percent.
“I could not imagine having come into the job when I did for a governor I didn’t already have that strong bond with,” Ms. Visalli said.