Last March, in advance of the current fiscal year beginning April 1, Rehoboth Beach commissioners approved a budget that surpassed $30 million for the first time in the city’s history.
During a special meeting Jan. 20, commissioners were presented a budget for fiscal year 2024 that comes in at $35.5 million – a 17.5% increase. The meeting was the first of five scheduled through March for commissioners to hash out the details.
Assistant City Manager Evan Miller presented the budget on behalf of City Manager Laurence Christian, who began in late December. Miller served as interim city manager for eight months.
Capital improvement projects are driving the increase. Miller said the proposed capital improvement budget is $4 million more than the current fiscal year – $10.5 million next year, $6.45 million this year.
The wastewater and water departments account for about $6 million of the proposed capital improvement budget, including $2.5 million to reconstruct the pump station on State Road; $1 million to complete Phase 3B of treatment plant improvements; $600,000 for the design of Phase 4B of treatment plant improvements; and $650,000 to replace well 6.
Coming in at $2.4 million is the design and construction of the new Rehoboth Beach Patrol headquarters and comfort station on Baltimore Avenue. This project has another $2.3 million slated for fiscal year 2025.
As proposed, on the expense side of the budget, city employees would receive a 3% raise, and an update to the employee classification study is funded.
A couple of relatively low-dollar expenses garnered most of the discussion.
There’s a $25,000 price tag related to a new cedar shingle roof for the Anna Hazzard Museum on Christian Street, which is one of the city’s original camp meeting association houses. It currently has asphalt shingles.
There are cedar shingles underneath those asphalt shingles, which means the current roof was done on the cheap, said Mayor Stan Mills, who voiced support for the cedar shingles.
The second item was the canal dock, at which Miller said the city is expected to spend about $2,300 on landscaping and other miscellaneous repairs.
It wasn’t next year’s expected expenses that got commissioners talking, but the city being left to care for the dock on its own after the dissolution of the Lewes-Rehoboth Canal Improvement Association late last year. The group spearheaded the construction of the $1.2 million dock; the city contributed almost $300,000 toward its completion.
Commissioner Tim Bennett said he loves the idea of the dock, but he isn’t sure what the city is going to do with it now because the expected kayak launch wasn’t built and a taxi service has yet to materialize.
Mills asked if the commissioners wanted to include funding for a kayak launch at the dock. No decisions were made, but the issue is expected to be brought up again.
The budget presentation included annual requests from four organizations the city supports financially – Rehoboth Beach Main Street, Rehoboth Beach Museum, Rehoboth Beach library and Rehoboth Beach Volunteer Fire Company. Main street, the library and the fire department have requested the same as the current year – $60,000, $75,000 and $150,000, respectively. Commissioner Patrick Gossett noted that while three three organizations have asked for the same amount, this year’s amount was an increase from the year before.
The museum has requested $30,000, which is $7,500 less than last year.
On the revenue side of the budget, transfer taxes are expected to be down $650,000 – $1.85 million to $1.2 million – but that’s one of the few areas the city is expecting less revenue. The city is budgeting for $380,000 more in rental tax; $800,000 more in parking revenue from credit cards; $800,000 more in parking revenue from pay-by-phone; $75,000 more in parking permit sales; and $380,000 more in building permits and appeals.
Noting the continued proliferation of residential rentals, Commissioner Toni Sharp said she would like to see the city invest more time and effort into making sure the rental tax revenue is the appropriate amount. The city needs to make sure it’s getting what it's entitled to, she said.
Revenues from the hotel accommodations tax – $1.54 million – and property taxes – $2.04 million – remain flat.
Commissioners are scheduled to resume budget discussions following their monthly workshop at 9 a.m., Monday, Feb. 6.