Kent, Sussex budgets include no tax increase, public safety focus 

Why Should Delaware Care? 
In Delaware, county governments are the source of development decisions, paramedic services and sewer system management, among other functions. The Kent and Sussex county budgets for the 2027 fiscal year have entered the final stages with balanced expenses and revenues, unlike the major deficit faced by New Castle County. Still, leaders in both counties say keeping up with balanced county finances as demand for services increases could become a challenge in future years. 

With the start of the 2027 fiscal year rapidly approaching on July 1, Delaware’s central and southern counties are slated to pass annual budgets without property tax rate increases or departmental cuts. 

This stands in stark contrast to New Castle County, which approved a 17% property tax hike last month to close a $42 million budget deficit. 

Kent and Sussex county officials said they have been able to work through this budget season without any major hiccups – unlike other jurisdictions in the state – thanks to a longstanding culture of lean spending combined with a growing tax base from residents moving to the area. 

“It’s definitely tough to keep up with your revenues when inflation just continues to increase, but we’re very conservative,” Sussex County Finance Director Gina Jennings told Spotlight Delaware. “We always look at ways to cut.” 

Kent and Sussex counties also do not have a county-run police department, which is a major expense for their northernmost counterpart. Spending on public safety, though, such as the counties’ emergency medical services and new ambulances, was still one of their largest expenses, respectively.

Sussex County also does not have a Parks & Recreation department – a service that cost Kent County $5.2 million last year. 

The Kent County Levy Court passed its $46 million operating budget on June 9. The budget for Delaware’s smallest county by population includes a property tax rate of 5.72 cents per $100 of assessed value, which is consistent with the previous two years. 

But the Levy Court also approved a 11% sewer user rate increase, which will raise residents’ sewer bills by about $50 per year, County Finance Director Susan Durham said. 

The Sussex County Council will soon vote on its $107 million operating budget, which includes a property tax rate of 2.14 cents per $100 of assessed value – unchanged in more than three decades. The county’s proposed budget also includes a sewer usage rate increase of $36 per household and a $90 water service charge increase. 

The Sussex County Council will hold a public hearing and final vote on its proposed FY 2027 budget beginning at 10:15 a.m. Tuesday, June 16. The meeting will take place inside Sussex County Council Chambers, located at 2 The Circle Georgetown. 

Despite the relatively smoother budget processes compared to New Castle County this fiscal year, Kent and Sussex leaders said they are concerned about long-term financial sustainability. As expenses and residents’ expectations of what services a county government should provide both rise, population growth – and therefore tax base – has the potential to plateau. 

Durham, the Kent County finance director, said she anticipates more difficult choices between continuing to increase funding for public safety and moving ahead with capital projects in future years. 

Kent County’s budget

Kent County’s $46 million operating budget, which grew by 6% from the past fiscal year, includes relatively standard increases to both revenue generated by taxes and departmental budgets. 

County officials seemed to be in agreement about the county’s budget, except for the question of the sewer usage rate increase, which became a point of contention during the final budget discussions. 

The Kent County Levy Court ultimately passed its budget unanimously.

The county will spend $19 million, or 41% of its total general fund expenditures, on public safety. That figure is up $2 million from last year, County Administrator Kevin Sipple said. The county is also allocating $1.5 million to its volunteer fire companies. 

Because the county does not have its own police force, its public safety dollars are directed to a combination of the county Emergency Medical Services (EMS), 911 communications and the emergency management department, which deals with disasters. The county is also funding the renovation of an EMS station, Sipple said. 

Kent County’s general fund revenues, which match projected expenditures at $46 million, will primarily come from a combination of county property taxes; its realty transfer tax – which is imposed at the same rate on property purchases across the three counties; and grants from the federal and state governments.

The property tax rate will remain stagnant this fiscal year, but Durham said property tax revenue is projected to increase from $14.6 million to $15 million because of new home construction. She described the county as having been in “a period of growth for over three years,” but not one that they can count on to help balance the budget in future years. 

Kent County completed its property tax reassessment in 2023, a year before New Castle and Sussex, so re-assessed home values did not factor into the increased tax revenue this year. 

Kent County also has library tax districts, which are generally consistent with school district boundaries within the county, to fund its five public libraries. Those tax rates all remained the same in this year’s budget. 

While Levy Court Commissioners unanimously approved the FY27 budget, tensions arose over the county’s sewer usage rate. Some commissioners said the rate already has seen a number of large increases in recent years. 

County staff recommended a 3% to 6% user rate increase this year, but elected officials pushed instead for an 11% increase – or $50 per year more on most residents’ bills. 

They described the jump as an effort to get ahead of the curve on debt service payments and funding future sewer improvement projects.  

The 11% increase ultimately was included in the approved budget, but Levy Court commissioners Terry Pepper and Jody Sweeney disputed the rate hike, saying it was an unnecessary burden on residents in already tight economic times.

Sweeney said he took issue with the argument made by another Levy Court commissioner that the higher sewer rate would only amount to one fast food dinner for a family. 

“This is what politicians say to justify increases, but to the family of four working 2-3 jobs to make ends meet, that McDonald’s meal may have been all they had,” Sweeney said at the June 9 meeting,  

The 11% user rate increase will generate about $460,000 more in revenue for the county’s sewer fund this year, Durham said.  

Sussex County’s budget

The Sussex County budget includes new initiatives this year, such as a building permit surcharge to help fund public schools and additional programs directed toward public safety. Still, county officials said the government’s longtime ethos of low taxes and limited government largely remains intact.  

The county’s $107 million general fund budget increased by 3.6% this year, which Jennings, the county finance director, attributed to standard inflation increases. 

Despite Sussex County’s position among some of the fastest growing in the country, the revenue generated by property taxes is only projected to increase by $130,000 from last year to about $17.9 million. 

This, Jennings told Spotlight Delaware, is because last June’s property tax reassessment substantially shifted the value away from growing parts of the county – like the Millsboro area – toward eastern beach communities, where less development is taking place. 

In previous years, population growth had created around a $600,000 increase in property tax revenue annually. 

As a result of reassessment, the county will need to rely on other funding sources, like the realty transfer tax – which provides money to both the county and the state when someone purchases a property – and other building permit fees to balance the budget and retain the county’s tradition of keeping property taxes “so low,” she said. 

A major new revenue source this year is a proposed building permit fee for schools, which will charge a fee of $5 per $1,000 of construction value for a building permit for all new residential and commercial development. 

The fee is projected to generate between $5 million and $7 million in revenue per year, to be given to public schools in the county for capital improvement projects like expanding classroom capacity, Jennings said. As the county’s population has expanded in recent years, a number of schools have struggled with overcrowding and a lack of funding for building expansion projects. 

On the spending side, the county plans to direct $48.3 million, or 45% of its operating budget, to public safety. 

County Council members and Jennings both described public safety, and in particular EMS services, as a focus of the FY27 budget. 

“We are really ramping it up this year,” Jennings said.

This push includes purchasing a new ambulance for each of the county’s 21 EMS companies over the next seven years and a new billing service for all the companies. Together, these initiatives will cost the county about $2 million per year, Jennings said. 

In recent years, independent libraries in Sussex County have struggled for funding while increasing the services they provide to meet community needs. This spring, the libraries undertook a campaign lobbying the county council to increase its library tax rate, which is their largest funding source. 

The county’s FY27 budget does not include an increase in the library tax rate. However, Jennings said the shifting in property values from reassessment amounted to a 10% increase in county funding for libraries, compared to the typical 3% to 4% increase to match inflation. 

The county is also directing $2.4 million from its operating budget to open space and farmland preservation programs.

It remains to be seen whether the county council will pass the budget in its current form, or make changes to county staff’s proposed budget. 

However, elected officials and county staff alike said more people moving to Sussex County has brought a greater demand for services and expectation of their government, which will soon have to be reconciled with the county’s historical commitment to lean government spending.

“We have typically been a county of low taxes, low services,” County Councilman Steve McCarron told Spotlight Delaware. “Every ask comes with a price tag.”

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Maggie Reynolds is a Report for America corps member and Spotlight Delaware reporter who covers rural communities in Delaware. Your donation to match our Report for America grant helps keep her writing stories like this one; please consider making a tax-deductible gift of any amount today by visiting https://spotlightdelaware.org/support/.