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April 13, 2001     Cape Gazette
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April 13, 2001

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54, .1. Friday, p l-pr, l, wx BLrSINESS & REAL ESTATE I Main Street facade, sign program starts with success By Trish Vernon There's an air of excitement wafting through downtown Re- hoboth Beach, as the city embarks upon the Downtown Revitaliza- tion Project, coupled with Re- hoboth Main Street's faCade and store sign initiatives. Surveyors have descended upon the blocks of Rehoboth Avenue this week, from Second Street to the Lewes-Rehoboth Canal as JMT Associates prepare an engi- neering study for Phase I of the re- vitalization process along that strip. City officials are also look- ing into new and more aesthetical- ly pleasing refuse removal meth- ods, as well as centralized LP gas delivery in the commercial dis- trict. With the project to include attractive streets, sidewalks, light- ing and landscaping, utilities will also be placed underground and a third public hearing on the latest design will be held sometime in June. Rehoboth Main Street Execu- tive Director Fay Jacobs is pleased with how merchants have shown interest in the sign and fa- cade programs initiated last year. "Both programs have taken off like gangbusters -we've had a fabulous response," said Jacobs, who noted the first project under- taken last year was the new facade for the Robert Thoma Salon on Baltimore Avenue. Robert Der- rickson's commercial building at Lankford wants Atlantic Sands expansion to keep up with revitalized Rehoboth By Dennis Forney Gene Lankford and Bob Moore are neighbors on Silver Lake Drive in Rehoboth Beach. They're also both businessmen investing heavily in the future of the community they've been part of for many years. The Moore family recently finished a renovation of its Dinner Bell Inn on Christian Street and also started construction of a major addition to that complex. [See related story in this section.] Lankford has been watching workmen put the finishing touches on a $10 millionexpansion of the Atlantic Sands Hotel he owns with Burke and Herbert Flickinger at Baltimore Avenue and the Boardwalk. "What encourages Bob and me is the downtown revitalization proj- ect that's being planned for downtown Rehoboth," said Lankford this week. "We want to keep up with the downtown. There's some risk but Continued on page 57 126/128 Rehoboth Avenue is in the process of being spruced up, complete with interesting archi- tectural modifications and paint and now housing two new tenants, Quiet Storm, which moved across the street, and The Shop, which will sell apparel and accessories. Also involved in the facade pro- gram are Ibach's Candies on Re- hoboth Avenue and Dos Locos on North First Street. This facade program provides $500 matching grant to businesses on a first come/first serve basis, with the proposal submitted to 'Main Street's design committee, chaired by Joanne DeFiore, for approval. "If the committee has the funds and feels the improvements will really enhance the building, the grant is awarded," Jacobs said. "We want the merchants to drop the 'cookie cutter' approach in fa- vor of an old-fashioned seaside town type of architectural flair, al- though we don't rule out other ar- chitectural styles, such as deco, that enhance the town." Jacobs also noted that Moon- Ifght Architects' Freddy Bada and Robert Rollins of Lewes are offer- ing a 35 percent discount to Re- hoboth's downtown property owners for their design services, as well as a free initial consulta- tion for any type of renovation. Continued on page 55 Tdsh Vernon photos Seaside Reflections is locating where Little Things had been located in the first block of Rehoboth Avenue, and Re- hoboth Main Street is pleased with how it and other stores are creating new upscale facades rather than backlit signs and harsh cinderblock styles. Dinner Bell Inn's 5 3-room expansion expected to be complete by April, 2001 By Dennis Forney Contractors dug down to sand last week on Christian St. in Rehoboth Beach preparing to set the foundation for a 53-room expansion of the Dinner Bell Inn. According to information supplied by the Moore family, which owns the complex, the new, four-story building rising from the foundation will be ready for occupancy in April of 2002. Together with the recent- ly completed renovation of the existing Dinner Bell Inn, the new com- plex will include a total of 80 rooms overlooking an expanded garden and new pool. "The style of the new inn will be comfortable and residential; like visiting the seaside home of a special friend," says a statement issued by the Moores. "Hardwood floors, fireplaces and old-fashioned hospi- Continued on page 56 New federal regulations change retirement planning In January, the Internal Revenue Service took action to simplify regulations that govern how much money people over the age of 70 !/2 and beneficiaries must with- draw each year from tax-deferred retirement accounts such as Indi- vidual Retirement Accounts (IRAs) and 401(k) plans. For many retirees, the changes will lower the annual amount they need to withdraw, allowing more of their assets the opportunity to continue growing tax-deferred. For those who stand to inherit the assets, the changes bring more flexibility to spread out the distri- butions over a number of years and reduce the taxes on the assets. You and your employees need to understand the new regulations and how you can use them to take advantage of new opportunities for extended tax-deferred saving. Distribution rule changes. While the regulations are com- plex, we'll examine three changes here. Single method of calculating mandatory lifetime distributions. Until the IRS issued the new re- proposed regulations, people had to choose between six methods of calculating required minimum FINANCIAL FOCUS ALLEN JONES distributions from retirement ac- counts that are mandated for ac- count once they reach age 70 1/2. The methods were based on a life expectancy factor that involved both the account holder's and the beneficiary's age. The new reproposed regulations substitute a single method based on the life expectancy of the ac- count holder, using a table that is based on the joint life expectancy of the account holder and a hypo- thetical beneficiary who is 10 years young than the account holder. This method is used re- gardless of whether or not the ac- count holder has designated a ben- eficiary. An exception exists for account holders whose sole bene- ficiary is a spouse who is more than 10 years younger than the ac- count owner. In that case, actual joint ages can be used for the cal- culation, producing an even smaller required minimum distri- bution. The standard table is the mini- mum incidental benefit life ex- pectancy table, known as the MDIB table. Using this standard table, a person will divide the ac- count balance as of the end of the prior year by the life expectancy factor to arrive at each year's re- quired minimum distribution. For many people, the new cal- culation method will result in low- er annual distributions. Because withdrawals are taxed as regular income, many people will benefit from a smaller tax bill on the less- er distribution each year as well. In addition, assets that remain in the account will continue to quali- fy for tax-deferred growth. Flexibility in designating a ben- eficiary. Previously, the calcula- tion method, based on the eldest beneficiary named on the account, was an irrevocable decision. Now, because distribution calculations are tlo longer linked to a designat- ed beneficiary, an account's bene- ficiary can be changed at any time without an adverse effect on the required minimum distribution amount. New choices with inherited ac- counts. The regulations allow new flexibility for beneficiaries to ex- tend an account's tax-deferred benefits. For accounts that pass to a spouse, payments continue us- ing the spouse's single life ex- pectancy. For beneficiaries other than a spouse, separate inherited accounts carl be distributed ac- cording to each beneficiary's sin- gle life expectancy. These .new rules generally allow beneficiaries to maintain a tax-deferred account over a greater number of years than before. If an account has no designated beneficiary and the account holder dies after starting to take required minimum distributions, the assets will be paid out over the account holder's remaining life expectan- cy, reduced by one each year. If an account has no beneficiary and the account holder dies before re- quired minimum distributions start, the balance may be paid out over five years. It is important to follow these IRS regulations carefu!ly. For those who take out less than the required minimum distribution amount each year after 70 1/2, the IRS continues to assess a 50 per- cent penalty tax on the amount that should have been distributed. Choice is yours this year. Al- though these new regulations don't take effect until January 2002, the IRS is allowing IRA ac- count holders to use the new cal- culation method for alendar year 2001 required minimum distribu- tions if they choose, regardless of the terms of the IRS documents. Business owners can also change their 401(k) or other quali- fied retirement plan documents this year to reflect the new regula- tions if they choose. Talk with your business's legal or tax advi- sor about how you and your em- ployees caa take advantage of these new opportunities for tax- deferred saving. Editor's note: Allen N. Jones is senior vice president and director of Merrill Lynch Business Finani- cal Services. For more informa- tion. call 227-5300.