Millsboro Town Council rejects a proposed hotel tax by the narrowest of margins.
Among the items in front of council members at a meeting earlier this month was a proposed 3% hotel tax. Councilwoman Kimberley Kaan, a supporter of the measure, pitched the move as a way to raise needed revenue for infrastructure improvements without raising property taxes.
“ I would rather go to somebody visiting from Virginia and our hotel for a couple of days and then to go back to our residents," she said.
But at-large Councilman Marty Presley countered that the handful of hotels in Millsboro aren’t catering to the tourist trade like those in nearby towns.
“They're not the people going to the beach," Presley said. "They're either business travelers here on business with our companies or the family members of our residents.”
Presley also questioned the need for a tax.
“I think it's an unnecessary tax," he said. "I think it's a tax just because we can do it, I don't think we should do it. I don't think it's beneficial to the town. I don't think it's money that's necessary.”
Another councilman, Matthew Davis, raised concerns about the tax impacting short-term rental owners. However, because the proposed ordinance would only affect properties with more than five bedrooms and no cooking facilities for guests, it is unclear how many short-term rentals would have to pay the proposed tax.
Millsboro only has a few hotels, and the projected revenue from the tax is around $120,000 - about 1.5% of the town’s operating budget.
Council members rejected the tax proposal by a narrow margin, 4-3, while some left open the option of revisiting the idea next year.
