Rehoboth budget woes could spark fee hikes, higher taxes
Sarah GamardRehoboth Beach residents will likely see fee hikes, on top of other increased billing costs, starting in April.
It's because the city is millions of dollars short to fund construction projects and government operations that officials want done this year. Commissioners and the city manager are fleshing out revenue measures to cover their shortfall.
The extra cash would help keep a promise that the city made last spring to revamp infrastructure and fund operations, on top of covering its debt service to a new sewage system that discharges treated wastewater into the Atlantic Ocean.
"We've taken great pains to do what we could," said Sharon Lynn, the Rehoboth Beach city manager, as she presented her budget proposal the board of commissioners on Jan. 7.
But how much residents might have to pay — and what that money would even pay for — is still undecided. Next fiscal year starts in April, and officials have until March 15 to finalize a plan.
Big projects, short on cash
The city passed a five-year, multimillion-dollar capital outlay plan in March.
Officials say it fixes two decades of deferred projects. It includes tennis court maintenance, park restoration and Boardwalk upkeep. The plan also funds resources for local departments, such as police equipment.
The city was supposed to have $4.9 million to spend on those projects for next year, but can now only fund about $511,000 of that.
That means the city has yet to budget several planned projects that would impact residents and visitors on a daily basis. One example is renovation for three public restrooms on Rehoboth, Delaware and Baltimore avenues to include new amenities, such as shower towers and baby changing tables. The city manager still hopes to finish the $760,000 "spruce-up" by mid-May.
It's unclear where the city will shore up the other $4.5 million of its capital outlay wish list. City officials meet again on Jan. 18 to talk about other possible revenue sources.
Residents could see property tax increases or higher building and licensing fees, said Rehoboth Beach Mayor Paul Kuhns.
"Anything's possible as far as revenue," Kuhns said.
The city manager could not be reached for comment after the Jan. 7 meeting.
Most of the available $511,000 will cover new kiosks to replace several hundred parking meters due to an expiring lease. The kiosks have license plate recognition technology to enforce parking regulations.
The city also wants to increase its trash pickup cost to scrape up funds. Residents might pay an extra $25 per household for trash pickup outside their home. Residents currently have to pay $250 to $275 annually, depending on if they are seasonal or year-round. The bump is expected to add $64,000 in revenue.
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Parking might cost more, too. Hourly parking rates will likely increase from $2 to $3 in some areas. The city was considering extending its parking permit season, but that's now unlikely to change this year after push-back from residents.
Officials are also flirting with the possibility of a new parking garage, which is not in the current budget proposal. Commissioners were supposed to discuss the garage in January, but have pushed those talks to next month.
Outfall project could raise sewer fees
The yet-to-be-determined revenue measures would be on top of a noticeable increase in sewer and water fees.
It would pay the debt service for a recently constructed, multimillion-dollar ocean outfall built to address pollution to the inland bays. That's on top of other debt services, such as paying off its new city hall building, that add up to about $59 million in outstanding debt, not including interest.
Background:To pay back debt, more treated sewage may go through Rehoboth pipe into ocean
To pay for it, as well as other water system services, the city is considering increasing wastewater fees by 60 percent and water fees by 30 percent by April 1.
That revenue is already incorporated into the budget. It would not help cover the other city projects that need funding, officials say.
"We're going to have to raise revenues above and beyond the increased rates for water and wastewater," the mayor said.
The average annual sewer bill is $581. The average water bill is $215.
There is another option: City officials are still considering asking Sussex County to take over its treated sewage system and, with it, more than $38 million in debt. The transfer would save Rehoboth a chunk of staffing and operations costs, and avoid any fee increase.
"It's one or the other," said a town spokesperson.
But the city is less likely to pursue the transfer after hearing from nay-saying residents during town hall meeting earlier this month.
More police, more enforcement
Rehoboth can also expect more enforcement this summer.
The city has budgeted eight additional police officers for the summer, which would mean four extra officers on the boardwalk at night. Each officer would work eight-hour shifts during "peak times" for five days a week, Rehoboth Beach Police Chief Keith Banks told the commissioners on Jan. 7.
The new staff would help enforce ordinances that have been rolled out in recent years, such as a rule that prohibits certain tents and canopies on the beach. Rehoboth Beach Patrol also wants two extra, non-lifeguard staffers to enforce rules during summer months.
It's to help make the community feel safe, officials say. Banks said that there is a "perception of the boardwalk late at night, that we have some crime," even when arrest statistics show "it's actually gone down."
“I don’t feel that there is (a) real crime activity up there," Banks said. "It’s more for a perception. ... But, at the end of the day, perception is reality."
The police department also wants to address "lighting issues" and install new cameras on the boardwalk, but neither of those items are so far budgeted for next year.
The department typically employs 24 part-time officers during the summer. The new officers would add about $68,000 total in part-time salary expenses.
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