For the first time in nearly 50 years, Deauville Beach in Rehoboth Beach is about to be under the operation of the state.

The Delaware Department of Natural Resources and Environmental Control announced Feb. 14 that it will assume day-to-day management of Deauville Beach from the City of Rehoboth Beach for the 2024 season.

“DNREC and the City of Rehoboth Beach were not able to reach an agreement through negotiations after the city’s current lease of the beach property Deauville Beach expired June 30, 2023, and mutually agreed to the change,” said a press release from DNREC.

DNREC’s announcement comes after months of closed-door negotiations and public discussions.

Deauville Beach was initially leased to the city by the state in 1975. The previous contract called for a $2,500 administrative fee due at the beginning of the lease, with an annual fee of $1.

During a meeting in early December, Interim City Manager Evan Miller said he and other staff had been in negotiations with DNREC since March. At the time, he said the city and state had reached an impasse and didn’t want to proceed any further without input from city commissioners. 

Miller said DNREC had proposed a new lease, with a fee that would be 10% of all daily parking and annual pass revenue sold at Deauville Beach. Miller estimated that would be $10,000 to $12,000 annually, and also said those terms had been negotiated down from the original proposal of 15% of revenue from concessions, parking and tennis court rentals.

At a second meeting, this one in early January, Miller said between lifeguards, parking enforcement, tennis court maintenance, rental of port-a-potties and other items, the city spends $150,000 per year at Deauville Beach. He also said that number doesn’t include labor for police or staff from the public works department. The city probably loses $25,000 to operate and maintain Deauville Beach, said Miller.

Over the course of those two meetings, city commissioners voiced their displeasure with DNREC.

Mayor Stan Mills said the city has done an excellent job as caretakers of the land, and DNREC was just being very greedy.

Commissioner Francis “Bunky” Markert described the proposed lease as a kick to the teeth and a little irritating.

According to the Feb. 14 press release, DNREC’s Division of Parks and Recreation will assume management of the state-owned beach and continue all services currently being provided, including tennis court rentals, beach concession operations and ocean lifeguarding.

“The division is working cooperatively with the city on a transition plan,” said the press release.

In an email a short time after DNREC’s announcement, Miller said the city is disappointed that after about 49 years of operating Deauville Beach on behalf of the state, it was not able to reach agreement on a new lease. After a year of negotiations, the city agreed it is in the best interest of all, and particularly those who use Deauville Beach, that DNREC take over operations there, he said.

The city is committed to providing a smooth transition, and officials are confident that the Division of Parks and Recreation will continue to provide great outdoor recreation services at Deauville Beach, said Miller.

“We are grateful to the state and DNREC for entrusting the City of Rehoboth Beach for so long with care for and management of this 600-yard section of our state’s coastal treasure,” said Miller.

Looking forward, the exact effect on the city’s budget is unknown. Miller acknowledged the city will see a loss of parking revenue from permit sales at Deauville Beach. However, he said, the city will also see a reduction in expenses for operating the parking lot, maintaining the beach and providing lifeguards.

Management of Deauville Beach has been a net financial loss for the city, said Miller.

The Delaware State Beach Patrol will provide lifeguard service from Saturday, May 25 through Monday, Sept. 2. A daily entrance fee will be in effect from March 1 through Nov. 30 annually. DNREC is assessing and reviewing the fee structure. The land will be part of the Cape Henlopen State Park management unit.

Editor’s note: This story has been updated with more background information and a comment from the city.