Bethany passes annual budget, with no tax increase

Credit to: Coastal Point, Susan Canfora

The Bethany Beach Town Council, by unanimous vote at the Friday, March 21, council meeting, passed the Town’s 2026-fiscal-year budget, with no increase in the property tax rate of $2.07 per $100 of assessed property value, but with a hike in the summer-season parking fee, to $4 per hour.

The increase, Assistant Town Manager Teresa Tieman told the council, was necessary to “add to our reserves to allow summer revenues to pay the Town’s expenses, so residents can still have free concerts.”

“I think we did the right thing,” Mayor Ron Calef later told the Coastal Point about the increase. “Unfortunately, as costs go up, we’re trying to balance it so our residents and the businesses are not footing all the cost increases. If we reduce the water or reduce any of those things, it would fall back on the residents and they would have to pay more in property taxes, and they wouldn’t want that.

“We try to balance our summer costs with our summer revenues so the residents aren’t carrying the burden of everything going on in town when most of it is for tourists,” he said. “We add 150 summertime employees, so we try to balance it so those costs are offsetting the summer revenues.

“Rehoboth has been at $4 an hour for parking for over a year, so we’re not out of play here. Dewey Beach is raising theirs to $4 this year. Ocean City is already at $4.50 an hour, so we certainly are not out of the realm of where we should be,” Calef said, adding that summer events and activities support businesses and “bring people in and keep the town the vibrant atmosphere it has been and will continue to be.”

During the town council meeting, Town Manager Cliff Graviet said that as COVID-19 pandemic-related operational changes ended, summer expenses were $4.9 million, and now they total $6.9 million.

At the March 17 public hearing on the budget, residents objected to the increase in parking and in the cost per gallon of water from the Town’s water system, but during the council meeting, council members clarified that the Water Department is operated as a separate business and has its own reserves and expenses. The cost of water per gallon has not been raised in 10 years.

Tieman said it should have been raised in the 2021-fiscal-year budget, “But council determined it was a terrible time to raise anything. In the years since, other departments had greater needs, so there was no increase in water. So, now, it’s being increased 20 percent,” she said.

“About $288,000 of the increase in the Water Fund is from a proposed 20 percent increase to water use fees,” according to budget information Calef provided. “The increase is projected to maintain the water department above recommended reserve minimums for the next five years. These fees are expected to increase bills by less than $100 per year for most property owners.”

Water rates on properties located within town limits are billed on a tiered basis, providing relief to properties with lower water use. The tiered rates are based on six months of use, since the Town bills for water services twice per year.

The Town’s total operating expense budget of $12.9 million is an increase of $1.1 million from the current fiscal year. Personnel costs are increasing by $611,000, and $331,000 of that increase is in the police department, so that wages for full-time and seasonal officers stay competitive with surrounding communities and the department is fully staffed. Seasonal wages are also higher for lifeguards, to compete for a limited number of employees. Other reasons for the increase are higher health insurance premiums and the State’s new paid leave program, the information stated.

The budget includes $15.2 million in revenue, $13 million in operating costs, $4.2 million in capital projects and $246,000 in debt payments.

The 2026 fiscal year will begin on April 1 and end March 31, 2026.