COUNCIL WORKSHOP
A Council Workshop was held on December 7, 2009 at 7:37 p.m. with Councilman Salters presiding in the absence of Council President Williams. Council members present were Mr. Leary, Mrs. Russell (arrived at 7:50 p.m.), Mr. McGlumphy, Mr. Slavin, Mr. McGiffin, Mr. Hogan, and Mr. Ruane.
Council staff members present were Mr. DePrima and Mrs. McDowell.
AGENDA ADDITIONS/DELETIONS
Mr. McGiffin moved for approval of the agenda, seconded by Mr. Hogan and unanimously carried.
Property Tax Relief and the Local Service Function Budget
During the October 12, 2009 Parks, Recreation, and Community Enhancement Committee Meeting, members were provided an update on the Planning and Funding for the New Library. At that time, Mr. Ruane stated his feeling that once again, Kent County is assessing and collecting property taxes from the City of Dover, as well as other municipalities; however, they do not offer any relief for those taxes for common services. He suggested that members of Council consider another option, that being a Local Service Function Budget, and stated that, with the Clerk’s Office assistance, he would be providing further details regarding this matter for their review and consideration.
Mr. Ruane reviewed a Presentation of Property Tax Relief and the Local Service Function Budget (Exhibit #1). He also referred to a chronology of efforts by the Dover City Council, Mayor, City Manager, Treasurer and Members of the Delaware General Assembly to Get Tax Relief for Dover Residents/Property Owners from 1967 through 2001 that was provided to members. Mr. Ruane explained that the purpose of the workshop was to discuss how equity can be achieved between overlapping local jurisdictions.
Mr. McGlumphy noted that there is one (1) municipality in New Castle County that has a Local Service Function Budget and two (2) that do not. As a taxpayer, he relayed concern and felt that this was an issue of fairness and, where there is a duplication of services, there is an unfair tax burden for being a resident of Kent County.
Mr. Hogan thanked the numerous legislators that have, on various occasions, attempted to pass legislation to remove these inequities. He noted that this legislation would pass the House but always failed in the Senate. In addition to the concept of merging library services, it was his opinion that there were other duplicated services that could be merged to provide a cost savings to both the municipality and county. It was his feeling that the City and County should work together to discuss the many opportunities that could come to fruition and provide improvements for residents of both the County and City while, at the same time, assure that these residents are paying a fair amount for the services they are receiving.
Responding to Mr. Slavin, Mr. Ruane confirmed that the issue does not only concern the City of Dover but other municipalities within Kent County as well. With regards to this being a constitutional issue, he noted that there was a taxpayer’s lawsuit filed in 1973 but in 1977 the suit was withdrawn by the City and dismissed. It was his opinion that the City may have withdrawn being optimistic that their goal could have been achieved through dialogue rather than through the courts. He reminded members that in 1985 there was much dialogue between the City and County; however, the idea ultimately failed.
Mr. Leary noted that this has been an issue that has constantly been brought up during the past 30+ years, which he felt is an indication that there is a problem and an issue that needs to be resolved. He suggested that members of Council move aggressively to resolve this issue, suggesting the possibility of working with the League of Local Governments since the issue involves other municipalities.
Mr. McGiffin questioned how a resident is “cheated”, explaining that although he is a resident of the City he still benefits from the work of the County. It was his opinion that whether a resident is within an incorporated area or not, they are equally affected by the action or inaction of the county in which they live. However, he expressed his awareness of there being duplicate services and that there may be a need to improve efficiencies in this regard.
Responding, Mr. Ruane explained that there is disproportionate funding and financing of certain services, explaining that residents of unincorporated areas are affected more by the actions or inactions of the county than a resident of incorporated areas.
Mr. McGlumphy referred to the duplication of services and, having been involved in the school system for several years, he reminded members of the concerns regarding consolidation within the local school districts to achieve cost savings and efficiencies to be produced by the potential of consolidation. It was his feeling that this is similar with the governments and considering that there are various duplications of services, there is a need to review these for cost effectiveness and efficiency. He felt that it would be a disservice to the residents of Dover if Council did not pursue this issue and take it as long as possible in an attempt to provide them with tax relief.
Mrs. Nancy Wagner, former State Representative, advised members that she was primary sponsor of the legislation which was passed by the House. Although this legislation was passed by the House on several occasions, she stated that it would fail in the Senate. She explained that members of Council were elected to represent the citizens of Dover and that several members of the Senate were elected to represent a large portion of County residents and to take action accordingly, which would be to prevent their constituents from paying higher taxes. She stated that the issue is to convince the Senators that it is in the best interest of their constituents and that it may not be from their perspective. Mrs. Wagner suggested that members keep this in mind when moving forward and suggested that it would be more helpful to consider establishing partnerships between the City and the County. It was her opinion that it will take a concerted effort of working collegially between the County Commissioners and City Council to come to a resolution as opposed to a legislative solution.
Mr. N. C. Vasuki, City of Dover Resident, advised members that he moved to the City of Dover in 1970 for good quality services and he has been willing to pay the necessary taxes for these services. He stated that residents expect certain services to be provided for the taxes that they pay. Having attended a recent Levy Court meeting, he advised members that a Commission member submitted a Resolution for the continuation of studying the Library consolidation concept, however, no other member would provide a second to allow for further discussion. When this occurred, he stated that he began investigating what services are provided by the County for which he pays taxes and determined that there is very little. He urged members to pursue this goal to create some equity in the way the residents are taxed and the services that are provided. Unfortunately, Mr. Vasuki stated that, with the exception of two (2) members, the remaining five (5) County Commissioners do not seem to care about reviewing the situation any further. Unless City Council takes a stand and forces the issue, it was his feeling that there would be no action taken by the Commissioners since they have no need to discuss the issues with the City residents paying for 27% of their budget and there is no need to take action to satisfy their residents’ needs. Concurring with Mrs. Wagner, Mr. Vasuki stated that a political solution may not be the best alternative and suggested that if the County Commissioners are not willing to work towards a resolution, the City should attempt to find relief from the justices and take the matter to court.
Mr. Ruane relayed appreciation to Mr. Vasuki for bringing this issue to the City and conducting research on the matter.
Senator Brian Bushweller stated that fair taxation and the people’s perception of fair taxation is vitally important in a democratic system. He stated that if people do not feel they are being treated fairly, it damages the peoples’ support and respect for their government, which is very important. He advised members that he represents residents in four (4) incorporated municipalities in his district: Dover, Camden, Wyoming, and Little Creek, with Dover being the largest. Should Council decide to move forward regarding this issue, he stated a desire to work with the City. In addition, Senator Bushweller stated he would like to discuss the matter with the other Mayors and Councils of the other municipalities that he represents. With regards to New Castle County, it was his feeling that there is a different distribution of power between the incorporated municipalities and the unincorporated areas, especially in terms of population. The incorporated areas of New Castle County comprise a greater percentage of the county than the incorporated areas of Kent County. This is reflected in the legislative representation, particularly in the Senate representation in the General Assembly. He felt that one of the reasons the legislation has failed in the past is due to the lack of data presented supporting the actual effect of a local service function budget. In order to gain support from the legislators, he stated that specific data would be necessary. Senator Bushweller stated that President Banta of the Levy Court recently indicated that there would not be much of a difference in the tax rates so the County was not likely to consider such a tough issue. In addition, he advised members that there would be a bigger difference in the taxes for New Castle County since they are responsible for a Police Department. He stressed that the first step would be establishing a good factual basis upon which to either move forward or not.
Senator Bushweller advised members that he has been considering introducing a Resolution to the Senate, preferably a joint or concurrent Resolution, calling for a study to be conducted to provide specific data with regards to this issue.
Mr. Eric Buckson, Fourth District Levy Court Commissioner, stated his concern that there is an impression that Levy Court is opposed to discussing the issue. Although action has been taken with regards to the establishment of a Library Commission, there has not been any discussion with regards to the duplication of services and taxation and he welcomes the opportunity to move forward regarding this matter.
Ms. Dorothy Lyons, 707 McGinnis Drive, stated that the Presentation provided indicated that there clearly are areas of duplication of services and expressed her feeling that there is a need to obtain specific data to present to the Levy Court Commissioners. Noting that the City of Dover is only one (1) of 20 incorporated areas within Kent County, she questioned if there has ever been an effort to bring all incorporated areas together to make a presentation as one (1) entity. She felt that such an effort would prove to be beneficial for all.
Mr. DePrima suggested that if this matter is discussed with other municipalities, the Presentation should be utilized as a tool since it has made a difficult issue much easier to comprehend.
Mr. Ruane noted that a draft Resolution has been provided to members and will be presented for consideration during their Regular Meeting of December 14, 2009.
Mr. McGiffin moved for adjournment, seconded by Mr. Hogan and unanimously carried.
Meeting Adjourned at 8:51 P.M.
TRACI A. McDOWELL
CITY CLERK
All orders, ordinances, and resolutions adopted by City Council during their Workshop Meeting of December 7, 2009, are hereby approved.
CARLETON E. CAREY, SR.
MAYOR
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Exhibits (Attached to original and file copy)
Exhibit #1 - Presentation of Property Tax Relief and the Local Services Function Budget