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January 18, 2013     Cape Gazette
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January 18, 2013

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:t~ i ! 116 FRIDAY, JANUARY 18 - MONDAY, JANUARY 21, 2013 NEWS Cape Gazette Riordan: Gross receipts tax is fair By Kara Nuzback Businesses in Dewey Beach could be forced to pay more to support town operations starting in 2014. Budget officials say a gross receipts tax on businesses is the best way to balance the town/s budget and ensure all en- tities are paying their fair share. Dewey Beach Budget and Fi- nance Committee will hold a public information meeting Sat- urday, Feb. 16, to discuss a refer- endum to create a gross receipts tax on larger businesses in town. A handful of town officials and two business owners who would be subject to the tax - Highway One partner John Snow and Star- board owner Steve Montgomery - attended a Jan. 12 budget com- mittee meeting to discuss the up- coming public presentation. The proposal would put a maximum 3 percent tax on all businesses located in town that bring in more than $100,000 per year. Officials estimate the tax would bring in more than $300,000 annually. Homeowners who rent their property in Dewey Beach are charged a 3 percent accommoda- tions tax on their gross proceeds each year. "What we need is more stabili- ty, more predictability in our rev- enue," said committee member Dave Davis. If the tax is ap- proved, he said, it would not be implemented until fiscal year 2015. The committee argues the town did not bring in enough revenue to meet the budget this year. Shortfalls include parking permits -which brought in $70,000 less than budgeted - business licenses, parking me- ters, delinquent parking fines of bedrooms in the home. In a written report, Riordan and town ordinance fines, stated, "The existing accommo- Transfer taxes, which have an- dations tax does exactly that, so nually created more thanwhy substitute an unreliable and $300,000 in revenue since 2009, therefore unfair tax for one that | are undependable, said Town Continued on page 17 I Commissioner and Budget Chairman Courtney Riordan. Before he was elected in Sep- tember, Riordan announced his opposition to a p perty tax, as. proposed by the F6rmer budget and fmance committee. Riordan said businesses, not property owners, should be paying more to support town operations. Committee member Dave Jasinski said the town's revenue sources are maxed out, and ef- forts to rein in expenditures, such as legal fees, which are cur- rently $40,000 over budget for the year, have repeatedly failed. The committee also says a property tax and an occupancy tax - two altematives to the gross receipts tax are not plausible. If a property tax were inn- posed, residents who do not ben- efit fmancially from more than 1 million tourists who visit the town each year would be paying the most, Riordan said. The town spends about $300,000 per year on seasonal police and near- ly $1 million on its year-round police force. Lifeguard services cost another $300,000. Committee member Joan Claybrook said residents simply do not want a property tax. "It's not going to happen," she said. If an occupancy tax, which would charge a fee for each per- son in a business, were imposed, the town would likely have to get rid of its accommodations tax, Davis said. Committee member Mike Dunmyer said a gross receipts tax is more precise than an occu- pancy tax, which, for rentals, would be based on the number CURTIS J LECIEJEWSKI D.D.S., MAGD, MICHAEL D. KELLER DMD. Acccepting New Patients Emergencies Welcome Call ": (301) 226-7960 to make your appointment 19643 Blue Bird Lane ....... Rehoboth Beach, 19971 (Located just o'ff South Coastal HighwayS" "~ $500 FOR THE BEST MRI We offer super high quality at a fair price MRI Consultants Lewes, LLC 32 channel 31 MRI- sees more, costs less We also use the safest MR contrast Prohance $200 more Dr. Philip Chao 17252-9 N. Village Main Blvd, Five Points Lewes DE 19958 302.827.4251 SUSSEX COUNTY 302.827.4351 fax mriphysician, ::THE ...... -,,,., ......... .; t~ i, Hardy 5-8PM i: Feb. 16, 2013 To benefit the Beach Police & Lifeguards Due to damage at the Baycenter from Hurricane Sandy, the gala will be hosted at The Starboard Tickets are limited due to the smaller space. Please check online at BeweyW .com if you are able to join us in support of our Police and Lifeguards.