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Instead of flat-rate or randomly assigned fees, Dewey Beach business owners will now pay business license fees based on occupancy. Gone are the days of paying extra for staying open late or not having public restrooms.
Under the new structure approved at a Saturday, April 14 town meeting, Dewey Beach will charge a flat fee per business plus $5 per person. This is what budget committee members call a fair and equitable fee that takes the face out of the equation.
“Every business is paying a lower fee, and for those who might end up paying more, it’s likely they have not been paying their fair share for years,” said budget committee member David King.
The new license fees may cost Dewey Beach as much as $90,000 in revenue, although city officials hope more reasonable fees will result in better compliance, offsetting some of the losses.
Dewey will charge $250 for a small eatery or store, $350 for a large business, and an additional $1,000 for serving alcohol, plus the building occupancy rate.
Although the license-fee changes were intended to go into effect next year, several business owners said they don’t want to wait for relief and urged council to speed up the process. The new structure lowers fees for most businesses, and owners say it’s about time. Commissioner Dale Cooke said the budget committee has been working on this project for years, and he’s happy council approved it so quickly.
Town council already approved a change in fees for real estate agents, but not for any other type of business.
Wings to Go owner Bob Forwood said, “We’re going to have a surplus this year so why are we waiting until next year to give relief to businesses? You reduced Realtors’ fees and all the others are stuck working behind the scenes.” He said it would be great to see council help business owners.
Commissioner Claire Walsh said she voted to approve the real estate license fee as a good-faith effort to get the committee moving on new fees for everyone.
After this year, the Baycenter will pay $910 with the new structure, but it paid $778 under the previous plan. But this year, no business will pay extra fees.
At the last minute, town attorney John Brady wrote a clause that caps all fees, allowing those who will get a break to get a refund on fees already paid this year, but not charging more this year for the few businesses that will pay more under the plan.
However, in 2008 the entire structure takes effect. Although the Baycenter’s fees will climb next year, Crabbers Cove, Venus on the Half Shell, The Rusty Rudder, The Lighthouse, and Northbeach, which are all restaurants owned by Highway One LLP, will pay less for business licenses.
Highway One LLP partner Jim Baeurle said, “There needs to be recognition by council that the people who paid into the surplus for the last 10 years should be getting that back.”
Before the commissioners voted, he suggested council wait to approve the proposal. Baeurle said commissioners should wait until the summer when more business owners are in town. “Once that structure is set, it’s very important because it has taken 10 years to reset it,” Baeurle said.
Rehoboth Beach-Dewey Beach Chamber of Commerce President Carol Everhart said she was concerned the budget committee met during the winter when business owners were out of town.
“The law states the fee is based on the cost of running the business. It’s not shortfalls, surplus, or anything. It’s what’s fair and equitable,” said Commissioner Mike Eisenhauer. He said state law mandates a town charge only what it costs to regulate business, but other commissioners said that was an unrealistic goal.
“This is not based on what it costs to regulate a business because that has not been established,” Walsh said.
Property owner Anna Legates said she is concerned with the town losing $90,000 in fees that might lead to eventually dipping into the surplus to pay for beach replenishment. She also said the town should not count on transfer tax as income because the state and county might take it away from municipalities.
Contact Molly Albertson at malbertson@capegazette.com
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