The Delaware Department of Natural Resources and Environmental Control (DNREC) and the Department of Transportation (DelDOT) are both on their way to gaining approval from the state legislature to update dozens of fines and fees.
DNREC has been advocating for an increase in several of its permit and licensing fees for years, and its efforts are close to paying off now that the House approved a package that would bring in over $7 million in revenue for the department — a $5.3 million increase.
The increases would not be for park entrance fees, but rather for regulatory activities within DNREC’s divisions of Air Quality, Waste and Hazardous Substances, Water and Watershed Stewardship — these funds represent 52% of DNREC’s budget.
State Rep. Debra Heffernan (D-Bellefonte) explains most of these fees have not been updated since 1991.
“It's going to give additional funding to many of DNREC’s departments, and it's going to support their work limiting pollution in Delaware's air, water and soil, as well as efforts to modernize and optimize permitting," Rep. Heffernan said.
These fees include things like solid waste, recycling and composting fees for facilities, emission offset fees, and licensing fees for drill contractors, well drillers and pump installers.
House Minority Leader Time Dukes (R-Laurel) says while he is optimistic about the current leadership of DNREC, he is disappointed with department's lack of collaboration with the General Assembly in the past and feels other changes need to be made within the agency.
"I believe that there is a systemic problem of, I guess we could say, control within the department that has nothing to do with the secretary. And so for now, I cannot vote for the bill, and I urge my colleagues on both sides of the aisle to do the same until we can get appropriate feedback from the department," Leader Dukes said.
The bill only passed with Democratic support.
DelDOT was also successful in getting its fee package passed, but not without a more contentious debate.
DelDOT commissioned the University of Delaware to study the impact of increased electric vehicles (EVs) on the state's Transportation Trust Fund, which is the source of funding for road and bridge improvements statewide, as well as the salary of DelDOT employees.
The Transportation Trust Fund, which is comprised of DMV fees, revenue from the motor fuel tax and toll revenue, is expected to bring in close to $588.5 million for the current fiscal year.
DelDot Secretary Shanté Hastings says revenue from the motor fuel tax is expected to fall $16.3 million below what the department projected for the current fiscal year due to a multitude of factors, including more EVs, general increased fuel efficiency and less travel.
That decline, coupled with increasing roadway impact due to EVs being heavier than traditional vehicles, has led to DelDOT's request of 16 new fees for EV owners to bridge the funding gap.
The new fees range from $15 to $900 depending on the weight of the vehicle or motorcycle and if it is electric, plug-in electric, non-plug-in electric or another fuel motor vehicle.
The bill would also create and increase several DMV fees, including a new replacement driver’s license fee of $20 and an increase in the driver’s license issuance and renewal fee from $40 to $50.
It would also raise the motor vehicle document fee — a charge assessed by car dealerships to cover the cost of processing paperwork and handling the vehicle's registration, title, and license plate transfer to the buyer — from 4.25% of the vehicle's purchase price to 5.25%.
In total, the new and increased fees are expected to bring in almost $39 million.
A majority of Republican lawmakers strongly oppose the bill, arguing the fee changes act as a regressive tax on lower income Delawareans.
"This is not just a regressive tax, this actually pushes more of the burden even further on the economic scale, rather than people who are buying new vehicles. So this actually— as far as regressive taxes go over the last 13 years, this might be the most regressive of the bunch," House Minority Whip Jeff Spiegelman (R-Clayton) said.
State Rep. Bryan Shupe (R-Milford) says the state should look at ways to integrate road and bridge improvement funds, as well as DelDOT employee salaries, into the state’s budget, rather than relying on fees and fines.
“It's not sustainable, It's not fiscally responsible, it's not something that we should continue to do year after year because we will come back to the table every couple of years and ask for fee increases on top of fee increase for residents because roads and bridges and salaries should be in a budget, not in fees that come to people," Rep. Shupe said.
He argues there isn't room in the state's budget due to its "reckless" spending habits and letting expenditure growth far outpace revenue growth.
State Rep. Madinah Wilson-Anton (D-Newark) was the only Democrat present who voted against the fee package, stating she agrees with several of her Republican colleague's statements about the increases negatively affecting low-income residents.
She expressed her frustration with the legislature opting not to pursue adding personal income tax brackets this year, which she says would have been a more progressive way to generate revenue for the state.
"I'm really disappointed that, in a year where I think we were poised to make a progressive move, a move that is based in equity, we have chosen as a body to instead look backwards. To instead, do the very opposite of what we've been charged to do," Rep. Wilson-Anton said.
The bill passed with only Democratic support and a yes vote from State Rep. Michael Smith (R-Newark) and State Rep. Kevin Hensley (R-Townsend).
Secretary Hastings says DelDOT also plans to increase tolls on I-95 and SR-1, which would generate a total $61 million in revenue.
Both bills head to the Senate for consideration.
