Sussex County Council approves an ordinance adding a building surcharge to help fund school construction.
The new surcharge, also known as a school impact fee, will add $5 per $1,000 of value to all building permits to help pay for student capacity-related capital improvements in local school districts: Cape Henlopen, Delmar, Indian River, Laurel, Milford, Seaford, Woodbridge, and Sussex Tech school districts.
Affordable housing developments supported by the Delaware State Housing Authority or the Sussex Rental program would be exempt.
The new surcharge has been in development for some time and Sussex County Finance Director Gina Jennings says schools will soon be able to benefit.
“This would be an application process through the school; we’d be doing the collections starting in July. Then, this time next year they have the opportunity to apply to be put in next year's budget to apply for those funds. And they can be used for capital projects [that are] capacity related.” she said.
Jennings notes Sussex County's plan is based on Kent County’s surcharge model but with a lower charge. She adds the surcharge is projected to generate $7 million based on 2025’s development activity.
Council passed the measure unanimously, though Council Vice President John Rieley reluctantly voted yes.
“This is a difficult vote for me because I’m concerned that council’s now embarking on a path that takes us “out of our lane” so to speak into being a fundraising mechanism for the schools in a new way, which I don’t believe is our primary responsibility. I believe it rests with the state, moreso.” he said.
Rieley argues every dollar added to housing costs can price another person out of the market, but notes the surcharge places the onus on developers, whose projects are adding to school capacity issues.
Cape Henlopen School District Director of Operations Jason Hale praised the move during public comment, saying it is a great show of support for the local schools by the County.
"This a monumental day for us. I know this takes a lot of work. I just want to personally recognize Gina Jennings for her tremendous work" he said.
Council passed the measure unanimously.
Sussex County Council also approved its $300 million budget for Fiscal Year 2027.
