Millville considers reducing taxes for annexation

Date Published: 
Sept. 29, 2017

Millville’s growing, and town officials are looking to attract even more development, so the town council is considering reducing taxes for new properties that annex into town.

The move started as part of an enticement package to encourage a recent 31-acre annexation along Windmill Drive and Dukes Drive, which the town council approved two weeks ago.

The Howard Robert Hickman Revocable Trust plans to build a 92-unit housing development called Peregrine Bay (on Sussex County Tax Map parcels 134-12.00-394.00 and 134-12.00-394.04).

“We put an incentive package together to get them to build here, instead of building in the county,” a decision that occurred in executive session, said Town Manager Debbie Botchie.

By making both ordinances retroactive for all of 2017, the Millville Town Council could fulfill its promise to the property owner.

The idea is just a starting point, as they discussed ideas and await guidance from the town solicitor.

“I think the purpose of it is to encourage annexation, because I think it benefits the town as a whole,” said Councilwoman Valerie Faden.

Ordinance 18-02 would create an “Abatement of Real Estate Taxes” section of Chapter 132, giving a one-year break on property taxes for any property annexing into town limits.

Ordinance 18-03 would reduce future real estate transfer taxes for the property (amending Chapter 132 “Realty Transfer Taxes”). Whenever the current property owner sells the property, the transfer tax would be 0.75 percent, or half of the town’s regular 1.5 percent.

The RTT discount would only relate to the first sale of property after its annexation, and a property annexed now might not be sold for five years (if being developed) or decades (if it’s an individual household).

There is room for more development tax breaks in the future.

“First we need to knock on the door,” and gauge the response, said Mayor Robert “Bob” Gordon. There are still “properties conducive for building and development. … We’re not all used up.”

But with residents in other parts of the county concerned about rapid development in Sussex County, what is the Town of Millville doing to curb rapid growth?

Botchie said the Town has more stringent rules than the County. For instance, sidewalks are required, and multi-modal paths were required along Substation Road. Also, the Delaware Department of Transportation will require Peregrine Bay to make changes to Windmill Drive to accommodate the new traffic.

No members of the public attended this week’s meeting, and there was no official vote. Discussion will continue at a future meeting. Because it’s a tax issue, they aren’t required to, but will likely hold a public hearing for the two ordinances.

Future town councils can always change the code if development gets out of control, officials noted.

The Millville Town Council’s next regular meeting will be Tuesday, Oct. 10, at 7 p.m.