Cape Gazette

RV park opponents say homes better option

Developer claims project would have positive impact
By Ron MacArthur | Mar 21, 2013
Photo by: Ron MacArthur The proposed 162-acre RV campground would be located near the intersection of Cedar Grove and Ward roads near Lewes.


Opponents of a proposed RV park near Lewes are using a Sussex County financial report to show that home construction on the same 162-acre parcel would result in millions more dollars in revenue to the county through taxes and building related fees.

During testimony at two public hearings, Greg Kordal, a resident of The Retreat at Love Creek, said 315 homes built on the 162-acre parcel would generate almost $1 million more in one-time revenue and more than $240,000 in annual revenue to the county. Kordal said over 20 years, 315 home sites would generate more than $9 million in revenue compared to just under $3 million by the RV park.

Nick Hammonds, representing the developer, said the RV park would have several positive economic impacts including job creation with construction and ongoing full and part-time employment with incremental employment at businesses used by campers such as restaurants.

He said the park owner would pay gross receipts, income, payroll, property and franchise taxes as well as water and sewer impact fees, ongoing utility service charges and license and permit fees, which all contribute to county or state revenue.

Hammonds said the average tourist coming to Delaware spends $564 per trip and $104 per day. “Additionally, many people that visit this area fall in love with it and end up purchasing a home,” Hammonds said.

Jack Lingo Asset Management has two applications pending for Love Creek RV Resort and Campground. The developer is asking for a conditional use and a zoning change from GR, general-residential district, to AR-1, agricultural residential, for 74 acres of the parcel. If approved, the entire 162-acre parcel would be zoned AR-1. Campgrounds are prohibited in GR zones.

Included on the site plan are 628 camping sites: 516 for recreational vehicles, 30 for tents and another 82 sites for rental cabins.

The public record on the applications has been left open until at least the end of March. Sussex County planning and zoning commissioners and county council members voted to leave it open to accept comments from state transportation officials on the developer's traffic impact study.

Opponents say area is zoned for homes

Residents in the area who oppose the project contend the area is zoned residential and should be developed with single-family homes, which is more in character with the neighborhood than a campground.

Kordal said the county report shows the greatest loss in revenue would be in realty transfer taxes, which accounts for $13.2 million in the county's fiscal 2013 budget and is the county's top revenue producer. For every transfer of real estate the county collects 3 percent, which is split with the state.

No realty transfer taxes would be paid on the RV campground property, although county property taxes, library taxes and school taxes, and sewer fees totaling an estimated $85,000 would be collected each year. Taxes and sewer charges collected from 315 homes would total an estimated $412,000, according to the report.

One-time revenue from the RV campground is estimated at $1.19 million, which includes $1.17 million from connection fees and about $14,000 in plan reviews and inspection and building permit fees. One-time revenue from the construction of 315 homes would include $945,000 from realty transfer taxes, $1.48 million from connection fees and more than $460,000 in plan review and inspection and building permit fees, according to the report.

Kordal, who has more than 40 years of experience as a financial executive, was among several speakers who testified on behalf of a coalition of homeowners opposed to the project. He added that real estate sales and building permits are on an upswing in the county. “The RV park is the wrong choice; it would be adverse to county finances,” he said.

The county report considered the financial impact of 631 home sites on the total 324 acre parcel. Kordal said since only 162 acres are being considered for the RV park, his comparison focused on the lower number.

Comments (2)
Posted by: Greg and Terri Kordal | Mar 21, 2013 11:06

We appreciate the information related to the RV project presented in Mr. MacArthur's report being shared with the readers of the Gazette.  The economic analysis prepared by the County Finance department and summarized by our presentations at the public hearings overwhelming conclude the RV Park will not support its on-going cost for county public safety services and infrastructure. 

One minor clarification of the comparison of revenues - the RV park total one-time and annual contribution would be $1.28 million and the homes option would be $3.31 million for a difference of $2.02 million more for homes.  The 20 year cash flow data was accurate -$9.4 million more for homes.

Also, I respectfully contest Mr. Hammonds suggestion that RV visitors would contribute more to the local community than homeowners.  The tax-paying resident will spend that much money (and more) - and will do that year-round. The homeowner will spend more money to support  various  local businesses to maintain their homes, enjoy sports/entertainment activities, and all regular services (banks, cleaners, pet care, hair salons, restaurants, etc.).  And they will do this all year!

Lingo and Hammonds are quoted in the article that the project will help the economy with construction - I think it is obvious that building homes will involve more construction (and jobs) than laying some gravel for an RV site. They indicate they will pay taxes on gross receipts, income, payroll taxes, etc. - The net income after they use accepted accounting techniques - deductions for expenses, etc. will not provide a significant tax base.  Hopefully  - they are not granted any tax incentives from state or local agencies.

Mr. Hammonds also contended at the public hearings that the RV visitors would not travel out of the park as it would be self-sustaining.  This allowed Lingo to support another contention that traffic and safety issues would be limited since the RV's would not be travelling out of the park.  Which will it be?  Can't have both. 

Again - we are grateful that the facts related to this proposed zoning change and conditional use application are being objectively presented by the Gazette.  Readers and taxpayers should continue to review these facts and express their opposition of the RV project to county and state officers.


Posted by: Barry Wayne Price | Mar 22, 2013 05:41

It appears the developers are grasping straws to support the zoning change, that will (if changed) maximize their profit. They are fooling no one. Hammonds claims that the RV Park will supply ongoing full and part-time employment with incremental employment at businesses used by campers such as restaurants.

As the Kordals say construction of homes will be much more beneficial to the residents and county of Sussex. As for full and part time employees - I doubt there will be many full time, and part time does not support families. As far as restaurant business - we all know that waiters and waitresses are paid below minimum wage, and live on tips, which are at the generosity of patrons, and cannot be relied on.

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