The General Assembly's one-day special session got off to a rocky start Tuesday, but ultimately seven bills were passed in an effort to provide immediate tax relief to New Castle County residents.
The special session was called to help tackle the fallout from court-mandated countywide reassessments, which have resulted in skyrocketing tax bills for some residents after seeing their properties reassessed for the first time in decades, especially in the northern part of the state.
Residents are also seeing tax jumps following school boards' decisions across the state to raise property taxes.
Generally, districts must go to referendum to increase taxes, but these recent hikes are due to a provision in Delaware law that allows school districts to realize a total revenue gain of up to 10% following reassessment.
While a total of 17 bills were filed to address the issue, not every piece of legislation was heard. After hours of contentious debate, seven bills made it across the finish line, and all but one have gained Gov. Matt Meyer's seal of approval
Debate over the legislative process
When the House convened for legislative business, representatives spent the first hour clashing over how the special session was proceeding on procedural grounds.
Special sessions are exceptionally rare in Delaware, and the bills heard on Tuesday did not go through the traditional vetting and committee hearing process that bills normally do.
House Republicans argued committee hearings still should have been made possible during this special session and raised concerns over a lack of public input while crafting the bills.
"This suspension of rules is a slap in the face to the process," Republican Whip Jeff Spiegelman (R-Clayton) said. "And it's a slap in the face to the people who will be affected by this who didn't have the capacity to come to the General Assembly to voice their concerns as they would if this was a normal process."
When asked about circumventing normal legislative procedures, House Speaker Melissa Minor-Brown (D-New Castle) said, "These are unprecedented times, and like I told the Republican caucus, it calls for unprecedented measures. If we had the time to really host committee hearings, we would have."
The Speaker said while Democratic leadership wishes it could have hosted committee hearings, she believes meeting with stakeholders prior to Tuesday's session and ensuring representatives from the counties and the school districts were in the building on Tuesday provided needed input and feedback.
What the legislature passed
House Bill 242, championed by State Rep. Kim Williams (D-Stanton), would give any school district located in New Castle County the ability to reset its tax rates for the 2025-2026 tax year and reissue a tax warrant using different tax rates for residential and non-residential property.
This bill is an effort to shift more of the tax burden off of residents and onto corporations, which generally saw large decreases in their property assessments.
"When you have Amazon paying $3.5 million in taxes, and it's being reduced to $1.1 million, there is a problem here," Rep. Williams said during debate. "These businesses come to our communities — yes provide jobs — but they're also supposed to be investing in our community, into our schools."
Several Republicans raised concerns over taxing corporations at a higher rate, arguing it only perpetuates a narrative that Delaware is increasingly losing its status as a "business friendly" state.
State Rep. Bryan Shupe (R-Milford) raised concern over other non-residential properties being taxed at a higher rate, like farms and small businesses, but Rep. Williams says school districts have promised to develop tax rates for varying non-residential properties in an equitable fashion.
"The school districts are not looking to hurt the businesses, small, large— we're just looking to share the burden of the taxes that are being put upon our residents that are struggling, the seniors, the disabled the [veterans], the families," Rep. Williams said.
Christina School District's Chief Financial Officer Bob Vacca adds the measure is only intended to be a stopgap and agrees with calls from both sides of the aisle to address long-term solutions when the legislative session resumes in January.
"There's a huge difference between saying right now I want to split a rate so I can bring some relief to a grandparent versus this is the final word on bills. We've talked, and believe me, the the districts are all in on school funding reform, referendum reform. This does not work. What we're doing right now is not working and we have lots of ideas on how to make it better," Vacca said.
The bill ultimately passed with bipartisan support in the House 30-8 with one abstention and two members absent. It passed with 14 yes votes in the senate, four abstentions and three members absent.
House Bill 241 would require that during the first tax year following a general reassessment, a payment plan be made available to residential taxpayers in New Castle County whose tax bill increases by $300 or more over the prior year.
Payments must be accepted on a quarterly or on a more frequent basis and cannot include any late fees, interest, or penalties, so long as the taxpayer is compliant.
The bill was also amended to prohibit New Castle County from collecting unpaid county and school taxes from a taxpayer’s real or personal property if the taxpayer has entered into a tax payment plan and complies with the payment plan.
Republican House Leader Tim Dukes (R-Laurel) introduced an amendment that would have required a taxpayer to be current in payment of real estate taxes and fees owed to the county for prior years to be eligible to enter into a payment plan, but that measure failed.
He was however successful in amending the bill to require the counties to waive penalties for those who enter a payment plan until the act sunsets in three years instead of being limited to the year after reassessment.
House Bill 240, also sponsored by Rep. Williams, would allow residents who successfully appeal their property values to be eligible for direct cash refunds if they have overpaid on their tax bills by $50 or more.
If the overpayment is less than $50, a county may elect to refund or credit the amount against future taxes due. Amounts in school taxes determined to have been overpaid by a residential taxpayer after an assessment appeal will be refunded by the county following the same rule.
Senate Bill 202 would require New Castle County to submit quarterly property tax reports to state leaders through the end of 2027. These reports must include information on payment plans, liens, property assessment appeals, property sales and property tax revenue collected and distributed to each school district within the county.
Senate Bill 203 would codify counties' authority to separately tax different classes of real property and Senate Bill 204 gives the same permission to municipalities. It’s been longstanding common law that counties and municipalities have this ability, but the new bill makes certain of it — it does not require counties to utilize the measure.
Finally, Senate Concurrent Resolution 122 calls for an immediate review of the recent statewide property reassessment by the members of the General Assembly in collaboration with state, local and school district officials to develop legislative and operational measures that ensure future reassessments are conducted fairly, transparently and equitably.
State Rep. Madinah Wilson-Anton (D-Newark) criticized the legislation for being too vague, noting her own proposal that was not brought forward for consideration would have provided a more specific outline for how various state agencies would go about making their recommendations.
But Speaker Minor-Brown says the extensiveness of the resolution is intentional.
"We left it broad for a reason because what we see, what we can envision, is not just one working group but quite a few different working groups under that legislation to really dig in on school districts. Not only do we want to look at reassessment reform, we want to look at school funding reform, we want to look at reform in our tax structure — it's going to be awhile," noting a deeper a look into how school boards decided on their revenue increases and an audit into Tyler Technologies — the outside contractor who conducted the reassessments — are both on the table.
What comes next
Gov. Matt Meyer signed all of the measures Tuesday night, except for Senate Bill 202. The governor's office would not provide comment on if the chief executive intends to sign the piece of legislation.
"Delaware for generations has prided itself in quality schools and affordable communities,” Gov. Meyer said in a statement. “We still, together, have a lot of work to do, but today's special session was a step in the right direction."
Speaker Minor-Brown made it clear to representatives on the floor that any bills that were not heard on Tuesday could still have an opportunity when session restarts next years.
"This special session was called to address the immediate issues that exist. There is so much more work to do. So we did not hear every bill today, but that does not mean that your bill will not be heard, especially if it's not going to impact the immediate situation right now," she said.
Although it's not out of the question that another special session could be called.
"You never know," the speaker said. "If something comes up, and we have to provide an immediate fix, I think we're going to do it. We're gong to do what we need to do to ensure Delawareans aren't suffering from these reassessments."
Under House Bill 242, new tax rates approved by a school district must be reported to the county and delivered with a new warrant no later than 10 business days from the effective date, which will happen upon the governor's signature.
