By Glenn Rolfe

DAGSBORO — Mayor and council on Monday approved a hike in the town’s capital improvements impact fee, an increase structured to financially plan for upcoming projects.

By a 4-1 vote following a public hearing, the ordinance amendment passed, upping the fee from $1,500 to $2,500.

“This impact fee is dedicated to capital improvements,” said Councilman William Chandler III. “For example, I think we are getting ready to build a new police office. That is a capital improvement. The police may also need new vehicles. That is a capital improvement. We may need a new Town Hall at some point. That is a capital improvement.”

Along with Councilman Chandler, council members Teresa Ulrich, Norwood Truitt and Mayor Brian Baull supported the increase. Councilman Will Labor opposed.

“Not that I am opposed to it, and I understand that we have future things that we want to do,” Councilman Labor said. “Maybe it actually needs to be $3,500? To me, I am having a hard time seeing why we are doing what we are doing.”

Councilwoman Ulrich said she reluctantly voted yes.

“I don’t want us to get to the point where our building permits are going to be so expensive that people are going to choose not to come into the town to build because they are going to be paying more fees,” she said. “I don’t want to price us out of the ballpark.”

Councilman Chandler emphasized that building permit fees and capital improvement impact fees are separate, as the latter are dedicated to capital improvements.

“That is the difference between the regular building permit fee,” he said. “(The capital improvements impact fee) has always been in our code and hasn’t been increased for decades. This is an effort to simply bring our code a little more current and to reflect the fact that we are going to incur some significant capital improvement costs going forward. It is to help offset the anticipated future costs that the town of Dagsboro will incur when it builds a new police department building.”

According to Kyle Gulbronson, the town’s AECOM consultant, over the last five years, Dagsboro has been averaging between five and 12 new homes per year, with a $1,500 fee for each.

In another fee matter, mayor and council voted 5-0 to increase the water connection fee to $2,600 for each building. That is a $600 rise, which town administrator Cindi Brought said will enable the town to cover its costs and not lose money.

“The reason we’re raising it is because to have the work done now, for the connection, it runs up to $2,400, and the rates are still going up,” said Ms. Brought. “So we’re going to $2,600 just to cover us.”

Councilman Chandler explained his support for the increase.

“We’re running a deficit. We might as well get this up to what we are being charged,” he said.

Mr. Gulbronson informed council that the increased fees “aren’t too far off from what other towns are charging at this point.”

The new rates will take effect once all documents are formally signed.