all intents and purposes, it was the kind of uncontroversial
measure which passes through County Council -- or, for that
matter, most legislative bodies -- to a unanimous vote with
little discussion. But Councilman Timothy Sheldon decided the
other night not to put proposed Ordinance 06-073 before Council
for, as the parliamentary formula goes, its consideration and
adoption. Most of his colleagues were not inclined at the moment
to approve it, but it was the kind of legislation that
politicians do not want to be on the public record as opposing.
Proposed Ordinance 06-073 would
give senior citizens and disabled persons who miss the June 1
deadline for filing to take advantage of the county's partial
property tax exemption until Jan. 1 to qualify for the companion
reduction in the fee for sanitary sewer service. Property tax is
due on Sept. 30; the sewer fee is payable in February with the
option of deferring half of it until June.
As the measure's preamble points
out, existing county code makes late filers eligible for partial
abatement of property tax, at one-fourth increments, if they
apply for the exemption by Oct. 1, Jan. 1, or Apr. 1. Council,
in fact, that same evening used its 'consent calendar' procedure
-- no dissent; no debate -- to approve two resolutions granting
such abatements to listed property owners.
Discussion at a finance committee
meeting earlier in the day demonstrated how two things which
appear similar in principle are different and indicated that the
taskforce being assembled to consider ways to boost county
revenue is likely to take a critical look at a variety of tax
breaks -- up to and including the exception that nonprofit
organizations enjoy when it comes to paying them.
Council members and the county administration, faced long-term
with what has been described as structural defects in the
revenue system, are about to look into some heretofore
sacrosanct corners to see if they should be swept. And it is not
nickels and dimes that they're dealing with.
The finance committee --- which,
like all its standing committees, includes all 13 Council
members -- was told that real estate tax exemptions 'cost' the
county $17 million a year in terms of revenue not collected. By
far the largest portion of that, $13 million, is the tax that
nonprofits do not pay.
The debate over that exclusion
has been ebbing and flowing for well beyond the memory of anyone
now participating in it.
Nonprofit organizations receive
many of the same public services that everyone else gets. The
big one in New Castle County is police protection, which
accounts for nearly half of the county budget. To be sure, a
nonprofit corporation as such cannot take a stroll in a park
although it could benefit from a borrowed library book. There
happens to be ample precedent for dealing with that mix.
The county property tax rate is now proportioned in incorporated
municipalities depending upon services provided. The same thing
could work for nonprofits by requiring them to pay at a
Justification for taxing them
lies in the fact that property tax is based on assets, not
income. The argument that a nonprofit entity should be exempt
from corporate income tax levied on profits may be valid for
those that do not engage in semantics by calling what otherwise
would be a profit a surplus or something else. Most nonprofits,
however, do own property assets and, in some cases, they are
The counter argument is that
nonprofits do contribute the the commonweal through their
employees. That is certainly true in New Castle County with such
entities as the University of Delaware and Christiana Care being
prime examples. It is also arguable that, by the nature of what
many of them do, nonprofits provide the public with services --
social services, in particular -- which otherwise would not be
The seniors' tax break is the
second most costly at $13 million. Late-filer abatements have
been rising -- to nearly $118,000 this fiscal year from $64,000
two years ago.
The argument there boils down to
whether seniors with relatively high incomes should benefit.
That is something of a judgment call in that the exemption
applies to the tax on the first $50,000 of assessed value of a
primary residence and is available only if annual household
income is less than $50,000.
However, as Councilmen
George Smiley and Jea Street pointed out, the real question is whether the
over-65 crowd is any more deserving of a break than younger families in
comparable circumstances. At a time when encouraging home ownership is public
policy, a young family with entry-level salaries is charged the full rate. If
there is to be an exemption, the question comes down to whether it should be
age-based or needs-based.
In a not unrelated
discussion, members of the finance committee discussed the equity involved in
allocating county economic development money. It ended up approving budget
transfers to provide grants of $75,000 to the Economic Development Council;
$50,000 to First State Innovations, a venture capital organization for
technology-based business; and $30,000 to Claymont Renaissance Development Corp.
Redevelopment director Karl Kalbacher said the grants are intended to offset "a
significant loss of jobs" which threatens to erode the area's economy and tax
base. "It is important that we continue to look to technology to grow our
economy," he said. "We're getting an enormous amount of bang for our buck."
He indicated, for
instance, that efforts are underway to attract an ethanol producer to the
largely idle General Chemical plant in Claymont, which would "employ a
couple hundred people." He did not elaborate at the meeting nor reply to a later
Delaforum inquiry seeking details.
Tansey questioned why the Claymont area is the recipient of county financial
support while he "has been two years trying [unsuccessfully] to get money for
Hockessin." Council president Paul Clark said that county grants are intended as
'seed money' to encourage jobs-related development. "This is to prime the pump;
it's not a steady stream," Clark said.
Hollins said what is lacking is "a clear process" for determining what gets
financed on a consistent basis. "There should be set criteria" and generally
available information about "how other communities get to apply," he said.
Tansey agreed. "There
has to be a process and we all have to participate in it," he said. "That hasn't
been the case in the past."
University of Utah study on the use of cellular telephones while driving should
be required reading for everyone in the General Assembly. Its conclusion: That
is as dangerous and as potential lethal as driving while
|under the influence
of alcohol or other drug. What's particularly significant is that
the cell phoners are more prolific than the drinkers.
State Representative Joseph Miro a
few years ago tried to get Delaware to join the ranks of states
which ban at least the hand-held variety. He failed when opponents
produced a study which showed police infrequently reporting cell
phones to be the cause or a contributing factor in accidents. As it
happens, these is not one of the listed options on the standard
police report and would not show up except in the unlikely event
the responsible driver voluntarily admitted that he or she was using
a phone at the time.
argument that listening to the radio is just as distracting does not
hold up. That is obviously a background thing and very few
people give it the same
degree of attention that they give to a telephone conversation. Likewise,
enforcement is not much of a problem. Casual observation is all it would take to
spot violators. Enforcing a ban on drivers using cell phones would be even
easier than enforcing the requirement that front-seat occupants use seat belts.
CLICK HERE to read the Salt Lake City
Tribune article about the study.