How Wilmington hopes increasing fees nearly 70% will bring in new revenue

Few industries would be spared from a nearly 70% increase in costs for business licenses, permitting, contracting, inspection and other fees under Wilmington Mayor Mike Purzycki’s budget proposal.

Legislation before the Wilmington City Council would increase roughly 150 city fees 66%-67% for various professions and services, entertainment and financial services, day care centers, rental property owners and more.

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Delaware Online/The News Journal requested to speak with Purzycki or someone in the city administration involved in the proposed fee increases, but the mayor’s deputy chief of staff, John Rago, declined, saying Wilmington would explain its reasoning when the City Council meets on the topic.

“This type of city-wide review of fees is something administrations should do periodically to ensure that fees related to the services, functions and operations of city government departments are set at a rate that covers the administrative costs of providing these services,” Rago wrote in an emailed response. “Some haven’t been updated since 1968.”

Purzycki announced the proposed fee hikes as part of a larger city effort to increase revenue streams to ensure Wilmington’s “long-term financial viability.” He also is proposing a $1 ticket tax on events and upping the hotel tax to 3%.

The city anticipates the increases would bring in an additional $4 million.

What fees will increase?

Wilmington City Code lists over 375 fees the city can impose for building and construction, public safety, special events and entertainment, and various business operations.

Most of the fees have not been updated since the early 2000s, according to a comprehensive list provided by Rago.

They include costs associated with business licenses and permits, inspections, certificates, applications and event fees to “defray the cost associated with administering and enforcing the city’s laws and the provision of certain municipal services,” Rago said.

Parking fees like booting and special permits are also part of the City Code.

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Legislation before the City Council amends about 150 fees for construction, businesses and fire prevention and protection.

But what about parking tickets and other reforms?

While Purzycki and council members have touted plans to reduce parking tickets to $25 since October last year, there is no legislation before the City Council yet to make that change.

Wilmington officials have resisted reducing parking ticket costs in the past largely due to its reliance on the revenue to fund basic city functions.

In 2019, the city announced reforms to its parking enforcement practices amid mounting criticism from the drivers’ advocacy group AAA Mid-Atlantic. AAA found that Wilmington’s parking tickets were more expensive than larger surrounding cities like Baltimore and Philadelphia and recommended Wilmington revise the cost.

At the time, city finance employees said parking ticket revenue was not a primary source of funding for Wilmington’s $100 million-plus annual budget and anticipated further reductions in the years to come. But the ticket cost wasn’t touched.

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The city expects to lose over $500,000 annually by reducing tickets from $40 to $25.

There is also no legislation before the City Council yet to increase the hotel tax to 3% and create a $1 ticket tax on events – both revenue streams to help draw an additional $4 million into the city.

When will these issues be discussed?

Wilmington Councilman Chris Johnson, who chairs the council Finance & Economic Development Committee, said the fee changes along with other proposed revenue generators will likely be discussed this week.

The committee is scheduled to meet at 4:30 p.m. Monday, April 3, to hear budget presentations from the Public Works and Parks and Recreation departments, according to the public agenda.

The committee is also set to meet Wednesday, April 5, for budget presentations from the Finance and Information Technology departments. The council calendar indicates revenue projections also will be discussed during that meeting, but an agenda has not been posted yet.

Attendees of a fines and fees town hall on March 28 were encouraged to speak at the City Council's upcoming budget hearings.

Wilmington Councilperson Shane Darby stressed that the task force will look at all city fines and fees.

"There is going to be a water bill increase, an event tax increase," she said. "We need the community to come out and speak."

The city's recently formed Fines and Fees Task Force will meet for the first time April 19.

Got a tip? Contact Amanda Fries at afries@delawareonline.com. Follow her on Twitter at @mandy_fries.

This article originally appeared on Delaware News Journal: Wilmington mayor plans to increase city fees nearly 70% to help budget