Some of Rehoboth’s largest hotels sit on the Boardwalk, overlooking the ocean. One would think hotel owners would be on the front lines of a key city issue: poor ocean water-quality test results that lowered Rehoboth’s ranking as one of the nation’s cleanest beaches.
But even with three new hotels proposed in town, Rehoboth hotel owners are not demanding a fix. Instead, they are fighting a measure to allow the city to add up to a 3 percent tax to hotel bills. This tax could raise close to $1 million in new city revenues, paid for by hotel guests.
The proposed tax is only half the 6 percent city tax on visitors who stay in rental houses, not hotels. Hotels bring hundreds of thousands of visitors to our beaches, yet their guests pay nothing directly to city coffers.
Hotel owners are quick to note they already pay an 8 percent state tax, 5 percent of which goes to the state general fund.
Of the remaining 3 percent, however, 1 percent goes to state tourism, 1 percent to local tourism offices and 1 percent to beach preservation – meaning more than a third of the state tax benefits Rehoboth hotels through marketing and maintaining Delaware beaches.
None of the state tax supports city services or infrastructure.
For hotels to oppose a 3 percent tax that could raise revenues to safeguard water quality is just plain reckless.
For our state representative to fail to even introduce the charter change necessary to enact this tax, approved unanimously by city commissioners, is disappointing, even reprehensible.
City officials must insist on this charter change before the end of the legislative session in June so the tax can be collected starting in January. This year, Rehoboth residents will pay 50 percent higher tax bills and steep increases in water and sewer bills.
It’s well past time for hotel guests to do their share to pay for city services and infrastructure they require.
Full disclosure: News editor and editorial board member Laura Ritter is a Rehoboth Beach property owner.
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Editorials are considered and written by Cape Gazette Editorial Board members, including Publisher Chris Rausch, Editor Jen Ellingsworth, News Editor Nick Roth and reporters Ron MacArthur and Chris Flood.
