REHOBOTH BEACH, Del. -- A proposed increase in business license fees in Rehoboth Beach is drawing mixed reactions from local business owners, some of whom say city leaders too often look to them to close budget gaps.
As city officials look to balance the budget for fiscal year 2027, one of the proposals on the table is a 20% overall increase in annual business license fees. Assistant City Manager Evan Miller said this is just one of the fees being reviewed, and any revenue generated from it would be allocated to the city's general fund.
“That would support the police department, administration, it would support our streets department, our building and grounds crews, and bandstand comfort stations,” said Miller.
The proposal aims to help fund city services and make contributions from businesses more equitable, particularly as leaders examine the services included with a license. Miller said they currently offer one free parking permit to businessowners along with the business license.
“These business licenses, in most cases, are $325. A parking permit is the same price, and they get one for free. I think it was important that we look at multiple options. One could be a flat business license fee without the parking permit, the other has an additional fee for the parking permit,” Miller said.
City leaders are also looking at fees associated with hotels, restaurants that sell liquor, among others. These fee discussions are still in the early stages, and no final decisions have been made.
However, some business owners said they often feel unfairly targeted in city budget decisions.
“The cost increase from the new license fee wouldn't hurt any business drastically, but the problem is that the town always comes after businesses to cover their budget downfalls,” said Steve Fallon, owner of Gidget's Gadgets.
Fallon said many business owners cannot vote on city matters unless they own property within city limits or hold a lease of at least 10 years.
"Most places will not give you a ten-year lease. If you want us to pay more, then maybe we should have a say in the government," Fallon said.
Fallon said he hopes the city considers ways to have residents in the city contribute more to the general fund as well.
“Why us all the time? Why the businesses? Why do the businesses carry the burden of a budget situation in town? I think it should be shared across the board with all of the people in town, especially the residents,” Fallon said. “The town has grown, there are like 5 million dollar houses here, so they could probably come to the plate a bit more."
Discussions on that proposal, along with other budget discussions, are expected to continue at the February 20th meeting at 9 am.