Government Policies & the Soaring Cost of Delaware Homeownership

By: Jane Brady, Chair, A Better Delaware 

The government is preventing many Delawareans from owning a home.  You may not realize it, but government fees, taxes and policies serve to increase not only the cost of purchasing a home, but also the cost of keeping one.

While re-assessment has been in the news and all of our mailboxes recently, there are many other factors that affect the cost of homeownership and purchase.

One significant factor begins with the requirement to pay impact fees. New Castle County is considering raising those fees by about 33%. These fees are intended to reimburse the county government for the cost of infrastructure that might be required when new homes are built, such as fire, law enforcement and emergency medical services. But, the County faces a housing shortage, and when the ordinance to raise those fees came to former New Castle County Executive, now Governor Meyer, he vetoed it, citing the severe need for more housing in New Castle County and the cost of acquiring a home. And, the reality is that these fees are reflected in the cost of a new home, making the reality of homeownership more expensive.  Mike Rieman, President of the Delaware Home Builders Association, is widely quoted as saying that “Even lumping impact fees into a 30-year mortgage will make a house less affordable because for every $1,000 increase, nearly 400 Delaware families become unqualified for a mortgage on that home.” Interest rates have remained high for some time, but are gradually coming down, so there is now more consumer interest in purchasing homes, but this increase would take that dream back out of reach.

We also have the highest real estate transfer tax in the country.  That means that if you purchase an average priced home costing $384,079, you will pay an additional $15,363 dollars to buy that home, or split that cost with the seller, depending on how you and the seller structure your settlement costs.  Either way, the cost is added to the transaction and the government gets the money. And, it is a lot of money.  New Castle County’s estimate in the 2025 budget is about $35 million.  Sussex County collected a remarkable $63 million in 2022, and approximately $53 million in 2024, according to county records.

Regulations add expense. The Cato Institute reported that the likelihood of approval to build is better for smaller projects, so companies scale back the size to improve the chances of approval. Cato reports that there is growing evidence that relaxing land-use regulations is the most effective way to expand housing supply and increase affordability.

Regulation affects the bottom line, which also affects the capacity of companies to build to meet housing needs.  Again, Cato cited research that found, as between more regulated San Francisco and less regulated Atlanta, there was a 12% reduction in revenue per firm. That means smaller, leaner firms that cannot offer the benefits of lower prices due to the economy of scale. At a time when, whatever we think about the idea, the theory is that concentrated living is better because it reduces commuting for work, shopping and recreation, perhaps we should reconsider our policies regarding scale of projects and regulatory restrictions.

The recent re-assessment and school tax increases got the attention of a lot of people, and therefore the attention of our elected officials.  Comparisons were made between the increase in spending in our school systems and the decrease in student performance – almost a directly inverse correlation.

As we at A Better Delaware have said many times, the government’s appetite for revenue is voracious, and never satisfied.  I waited tables for 10 years in the summer. I decided I should write a book called “The Other Side of the Plate”, because the perspective is so different there. Well, legislators and regulators live on the other side of your checkbook, and they have a different perspective on how much you need your money, as opposed to them.   And remember that “highest in the nation” real estate transfer tax? It was increased at a time when the state revenue was down, and promises were made it would be retracted when times got better. But, when, during the pandemic we had billions of dollars in surplus and some in the General Assembly encouraged a reduction, it was not passed.

There are common sense ways to reduce the cost of housing and make it accessible to more of our neighbors.  Reduce the transfer tax. Relieve builders and investors of regulatory restrictions. Encourage multi-unit /multi-function development, such as communities of condominiums and townhomes, with shopping, medical services and recreation in the community. No one thinks we should not support the increased need for services when new homes are built, but those fees should be fairly imposed and directly related to the impact of the increased demand.

It felt good to be heard when we raised heck about the increase in school taxes and county taxes related to the increased assessed value of our homes.  Now you need to let your elected officials know how you feel about the impact government policies are having on you and your neighbors when it comes to affordable housing.

Jane Brady serves as Chair of A Better Delaware. She previously served as Attorney General of Delaware and as a Judge of the Delaware Superior Court.

Rethinking Taxes, Spending, and Education in Delaware

 By: Jane Brady, Chair, A Better Delaware

There has been a lot of coverage and comment recently on the significant increases in property and school taxes. The significance of the increase was largely due to an irresponsible delay in property reassessment for over 40 years, resulting in discrepancies and unfairness in the amounts paid by property owners.

Assessments are taxes, and we have a lot of them in Delaware. Our legislature’s appetite is voracious.  The growth in spending, and the increase in the rate of growth, when looked at over the span of the last 25 years, is alarming. The numbers below are from state government sources.

It was in 2001 when Delaware’s budget first approximated $1 billion.  By 2009, that number had grown to $3.63 billion.  In 2020, it was $4.4 billion, and in 2025, it is $6.5 billion.  The pace at which we are spending is increasing.

Now, maybe you don’t mind paying taxes. After all, if the funds are helping people who need it, if the money is being spent efficiently and effectively, then there is reason to support the expenditures.  I wish we could say it was so.

This year, in order to ease the burden of managing the spending of your money, the State has decided to just give every student a free lunch, not limiting that service to those who have a need.  There is so much inaccuracy in managing the money in the unemployment program, they cannot accurately audit the funds to determine if the people we are paying truly qualify and if we are paying them the right amount. And, in education, students continue to test in the bottom of the nation.

The disappointing results in student performance continue despite the fact that spending on education has increased significantly. We are in the top tier of all states in spending on education. In fact, fully one third of our state budget is spent on public education. But we are 46^th in student performance. Not effective spending at all.

Where does this money for our budget come from?   On average, over the years, about 40% comes from individual income taxes, 40% from licenses, 15% from gross receipts taxes and the balance from miscellaneous sources.  Our personal income tax rate is in the top 10 in the nation, and our corporate tax rate is as well.

If more spending does not improve our education system, do our tax and spending policies make our economy better? It does not appear so.  According to USA Facts, Delaware’s annualized Gross Domestic Product (GDP) growth was 1.7% over 5 years, placing Delaware 46^th out of our 50 states. And, according to the US Bureau of Economic Analysis, Delaware’s economy grew 0% in the first quarter of 2025.

What should be done to improve results and lower the tax burden on Delaware citizens? First, eliminate the gross receipts tax. After all, ultimately you pay it in the prices you pay for the items you buy. Gross receipts taxes are a tax on the sale of items in grocery and hardware stores, mom and pop bakeries and taco stands.  It is a double tax that hits small business especially hard, because it taxes the money made on sales before the business owner takes out supplies, wages, and rent. Then, after the owner takes home a little money, that is taxed as income.  Most states have eliminated this type of tax.  Delaware should too.

We should demand that our education system start producing the product it promises – learning. Delaware should adopt the policy that Mississippi and other states have and require third graders be able to read at grade level before being passed to fourth grade. Mississippi, which had been at the bottom of the rankings for 30 years, is now ranked 21 among states for student performance. The difference in only six years? Their students can read. Every student, teacher, and parent was invested in a result that changed students’ lives – getting them to read well enough to be promoted. Now they can read, those students can learn!! We are graduating students in Delaware that truly cannot read. It is not fair to them, their families or the rest of us that we are failing them so badly.

And we should work to encourage a vigorous business climate in Delaware. Bring in good businesses with good paying jobs. Know that it will be difficult until we improve our education results, as the people who bring their companies to Delaware want their children to be able to learn. We should adopt tax policies that encourage young entrepreneurs to open and grow businesses and offer expanded learning and training opportunities for the trades and technology.

Delaware has been considered a leader since this country’s inception. The truth is tarnished, but the spark is not expired. We all have reason to be invested in Delaware’s success in the future – for our families and those who will come after us. Let us be committed – now – to A Better Delaware.

Jane Brady serves as Chair of A Better Delaware. She previously served as Attorney General of Delaware and as a Judge of the Delaware Superior Court.

Reforming Delaware’s Health Care: Costs, Competition, and Common-Sense Solutions

 By: Jane Brady, Chair, A Better Delaware

Everyone is concerned about the cost of health care in Delaware. The patients and their families who owe medical debt, the legislators in the General Assembly, the hospitals that are accruing increasing mountains of unpaid costs for medical services and the Governor.  Numerous efforts have been undertaken to address the issue, and in truth, most of them are misguided and are likely to be ineffective and unsustainable.

The General Assembly passed the Diamond State Hospital Cost Review Board (HB 350), which establishes a government board to review hospital spending and budgets to determine if they think the hospital could or should align the facility’s priorities differently to cut costs.  Christiana Care has sued to prevent the bill from taking effect, and although members of the panel have been appointed, implementation is already in turmoil.

Recently the Chair of the Board resigned, expressing that he felt the Governor exerted inappropriate influence over the Board’s actions.  The Governor has expressed that he is skeptical that the Board will be effective in cutting hospital costs (a position that we at A Better Delaware share and advocated for prior to the bill being passed). At the very same meeting of the Appropriations Committee that the Board appropriated $700,00.00 to get under way, the same Committee voted to expand the procedures for which the State would pay for their insured to receive, and to eliminate the co-pays for those services by those patients.  The contradiction seemed lost on the members of the Committee who voted to support both provisions.

The Governor partnered with a non-profit, Undue Medical Debt, and provided an initial sum of $500,000.00 to that organization to pay off what even the organization describes as debt that would likely go uncollected, according to CEO Allison Sesso.  Governor Meyer claims it will eliminate $50 million of medical debt for 17,000 Delaware families. If this debt is likely uncollectable, we are essentially using taxpayer dollars to subsidize (further) the hospitals in Delaware.

Behind all these efforts are real people who are not getting the best quality and more effective health care delivery available.  The most significant indicator of that is the time patients wait in the emergency room. Delaware has horrible wait times in the ER, as anyone who has had to visit one knows.  In fact, we are among the worst in the nation, with an average of 3 hours and 31 minutes wait.  It used to be worse, but hospitals have expanded emergency care beyond their four corners and opened remote emergency services at walk in care facilities.  Recently, a trip of an acquaintance to one of these remote ERs resulted in them being called back before their check-in was completed. There was only one other person in the waiting room. So, take her 5 minutes, say, and average it to get 3 hours and 31 minutes and you get an idea of how long your wait in Delaware can be.

And, how long you wait in an emergency room matters. A study by the Office of National Statistics in England found that if you wait 3 hours in an ER, you have a 10% greater chance of dying in the next 30 days than if you only waited 2 hours. And, if you wait 6 hours, which occurs, regrettably, on a regular basis across our state and the country, you have a 60% greater chance of dying in the next 30 days than if you waited only 2 hours.

There are better ways to address both access to care and quality of care. We have said it many times – more competition.  Eliminate the certificate of need as most states have now done. That law puts representatives of facilities already in business providing health care in Delaware in charge of decisions whether other facilities can enter the state to do business or whether new services, equipment or facilities can be offered by others already doing business in the state.  Study after study, since the early 90s support that the quality of care and the access to care improve when the number of services offered and the number of facilities offering those services are increased.

Let’s bring common sense back to the analysis of this, and other, issues. Let’s learn from the experience of other hospitals and health care systems. And let’s look at the long term, sustainable solutions that will give all of us better access to quality health care.

Jane Brady serves as Chair of A Better Delaware. She previously served as Attorney General of Delaware and as a Judge of the Delaware Superior Court.