Sussex County Delaware
F.I. Budget Process
Misses the Mark
Guest Opinion, Oct. 21, 2002

Writer Says Process
Should Be More Open

NOTE: The following letter was submitted to Fenwick Island Town Council and to Sussex County Online by Fenwick Island resident Ginny Borodulia.

Fenwick Island Budget

Guest Opinion

Confirming my conversation with Mr. Haon, I am writing this letter for two reasons: to ascertain that my comments below are correct and to respectfully request that the voting on the implementation of a 7 1/2% rental receipt tax from commercial property owners be rescheduled after budget considerations are met.

Under the Freedom of Information Act, all property owners, both private and commercial, are entitled to budget information that has not been forthcoming from the town council. Please consider the following concerns:

  • Elected Officials
    It is my understanding that the Town of Fenwick Island is a councilmanic form of government which constitutes 7 equal votes. The policies and procedures are determined on an equal basis. Have the property owners voted to change this form of government to a mayoral type of government? The use of mayor has been misleading as it is only an honorary title and is unofficial and not in accordance with the Town Charter.

  • Taxes
    Fenwick Island has the smallest area (approximately 1 square mile) but the highest tax rates among the shore towns. The city tax rate for Fenwick is $1.60 compared to Dewey Beach with approximately the same amenities/services at $.40. Fenwick's tax/$100 assessment is 3.9963 while Dewey is 2.7653. Bethany Beach and Rehoboth Beach fall in between. The town of Dewey Beach receives most of its revenue from business licenses, transfer taxes and fines.

    Fenwick enjoys the same revenue, but with the great appreciation in property values, receives 1.5% transfer tax on the value of the property represented. The property value upswing of small cottages being turned into large homes has resulted in additional monies. However, the Town determined that property owners were to pay an additional 10 percent in property taxes. The Town Charter states on Page 9, Section 24A -- Assessment and Collection of Taxes, Item 7: "the amount to be raised from this source shall not exceed in any one year the sum of five percent (5%) of the total appraised valuation of all taxable real estate."

    Of course, this is after a budget has been submitted in August and designates the Council's "best judgment and knowledge of the total amount necessary to be raised by the Town to meet fixed and anticipated expenses and obligations." (Section 24A -- Assessments and Collection of Taxes). Also, Fenwick is the only shore town to base a business license fee on square footage rather than a flat rate.

    In our discussion, Mr. Haon told me that administrative matters in the town have been lax and the town is working to improve this. No audit of the financial records has been done since 1998 in violation of Section 20 of the Town Charter. No explanation is forthcoming as to what the $14,000 Miscellaneous expense was in 1999. Miscellaneous expenses were $39,952 in 2000 and an additional $24,210 in 2001. No figure has been available for 2002. I shudder to see what it could be and for what.

    None of these figures is for additional health care or administrative costs. Mr. Haon said that since the administrative personnel were overworked and getting behind, that an additional part-time person was hired. Mr. Haon also told me that the council determines budget matters since they have been elected by the people and are thus empowered as elected officials to make spending decisions. This is well and good IF a budget is public and accepted.

  • Services and Amenities
    Mr. Haon agreed with my comments that commercial property owners receive no town services, i.e. trash pickup, police protection (commercial is considered private property), no grass mowing, snow removal, etc.

    The Fenwick Police have had ongoing problems but all residents should be able to talk to an officer and not get an answering machine. With the number of police hired for this small area, it is shameful that the police don't know the year-round residents. They lack a sense of community. We have one policeman available and several cars just sitting in the parking lot. The town maintenance workers collect trash two times / week in the summer and once a week in the winter. There is no grass cutting in the winter. Do we need 5 full-time workers?

    The Town of Fenwick Council has not been prompt in responding to prior inquiries, which the property owners are entitled to have. It appears that no effort to tighten the belt has been made, but rather to increase spending/taxes with an unaudited budget. Therefore, I again request that the implementation of the January 1 commercial rental tax be considered after financial audits. I shall be notifying the local media with your answers to the above concerns.
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