FENWICK ISLAND – Officials in Fenwick Island last week adopted a $4.1 million budget for the coming fiscal year.
Last Friday, the Fenwick Island Town Council voted 6-0 to approve a fiscal year 2022 budget of $4,190,477, as well as a fee schedule that includes a property tax rate of 0.1740 per $100 of assessed value.
The spending plan includes an operating budget of $2,341,192 and a capital budget of $1,849,285.
“Fenwick did very well during the pandemic, but when making this budget last year we weren’t sure what would happen,” Town Manager Terry Tieman told officials during budget preparations late last month. “We wanted to take a conservative approach again this year.”
The operating budget approved last week includes a $81,779, or a roughly 3.8%, increase over the current budget. Revenues includes $2.23 million in transfers, $724,250 in taxes and $405,000 in rental receipt tax, while expenses include $832,414 for the police department, $456,410 for general government and $407,860 for lifeguards, to name a few.
Elected leaders last week also voted to approve funds for several capital projects in the coming year. The capital improvement budget includes $1.1 million for hydraulic dredging, $545,000 for new sidewalks and $92,000 for a police vehicle.
With no discussion, the council voted 6-0, with Councilman Bernie Merritt absent, to approve the operating and capital budgets last week. The new fiscal year begins on Aug. 1.
Following the vote, however, town officials took time to address false reports of a proposed 66% tax increase.
When asked to explain the situation, Tieman told community members she believed the rumors began after last month’s budget committee meeting. She noted a committee member’s questions about the tax rate delved into further conversations about the need for an increase, which she noted hasn’t happened since 2002.
“We also went on to explain to the council and budget committee that we are relying heavily on our RTT [realty transfer tax] funds, and that that’s not the best financial plan to use and that we should become less reliant on RTT …,” she explained. “I believe at that point the committee member said, ‘Well how much would the tax increase be to stop relying on that?’ And I responded it would take a 10-cent tax increase, about $400,000.”
Tieman noted, however, that any proposed tax increase would not occur in one year.
“To my recollection another committee member indicated that’s a huge increase, and I agree that is a huge increase,” she said. “But I would not suggest that we would ever implement that in one year. I think we need a planned strategy for becoming less dependent on our RTT money, and that we need more sustainable revenue sources.”
Councilman Mike Houser told community members that discussions on different tax rates were an attempt to plan for the future.
“I want to point out in this process it would be foolhardy not to create scenarios for the future,” he said. “That’s all that was being done.”
During public comments last week, resident Mark Tingle said he was the committee member to broach the subject of the town’s tax rate at last month’s budget meeting.
“Thirty percent of our budget is covered by taxes. That’s lowly insufficient,” he said. “Back in 2008, 2009, other towns in Delaware were relying on RTT money – mainly Ocean View, Millville – and they were all on the verge of bankruptcy after the crisis. I knew the answer, I asked the question, and then it was turned into something that wasn’t the case.”
