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Delaware Senate Democrats

Sen. Hansen Files Legislation to Enable Neighborhood Improvement Districts in New Castle County

May 5, 2022

DOVER – Communities in New Castle County where the homeowners association or maintenance corporation have fallen into disuse would have a new tool for providing trash collection, snow removal, street cleaning, graffiti removal, open space management or other common-interest services under legislation filed Thursday by Sen. Stephanie Hansen.

Senate Bill 286 would allow Delaware’s most populous county to create Neighborhood Improvement Districts where New Castle County government could establish nonprofit corporations capable of collecting fees from homeowners to pay for a variety of services that benefit local residents.

“Throughout New Castle County, we have seen time and time again how HOAs that were thriving when a development was first built have withered with time and become defunct or completely unresponsive,” said Sen. Hansen, who served as New Castle County Council President from 1996 to 2001.

“No neighborhood should be held hostage by a legal entity that has effectively ceased to exist but still holds the rights and responsibilities necessary to maintain a functioning community,” said Hansen, D-Middletown. “This legislation would enable the county to step in, negotiate services and fees on behalf of a specific development and help communities resolve long-standing problems, create stability and improve the quality of life for all residents.”

Under SB 286, the residents and property owners in a given subdivision or a member of County Council would be empowered to petition New Castle County Council to establish a Neighborhood Improvement District (NID). If accepted, the county would be required to provide all property owners and renters in the proposed district with a preliminary NID plan that spells out the specific fees and services being recommended, as well as 30-days advance notice of a hearing where public comment will be considered.

Unless more than 50% of property owners who would be assessed a fee object to the preliminary NID plan, a proposed final NID plan would be distributed to the community with any revisions from the preliminary plan clearly identified, followed by a second public hearing and another period within which objections can be lodged. Unless more than 50% of property owners object to the Final NID plan, the County would consider an ordinance to establish the NID. Amendments to the Final NID plan can be made only with the consent of at least 51% of affected property owners.

Once an NID is approved, the county would be required to designate a nonprofit management association to collect fees and contract for common-interest services. The board of each management association would be required to include at least one affected property owner as a voting member and one county representative as a non-voting member. District advisory boards made up of affected property owners and residents also could be established.

NID management associations would be required to provide reports detailing the financial and programmatic activities of the prior year, along with a summary of annual audits required under SB 286.

Every NID created by New Castle County Government would sunset after five years unless extended by a vote of County Council.

“Over the years, I’ve spent countless hours working to improve communities around my district that have fallen into disrepair, especially those with absentee landlord,” said Rep. Debra Heffernan, the House prime sponsor of SB 286. “This legislation will give us the tools we need to revitalize those communities and improve quality of life for residents.”

“The Neighborhood Improvement District legislation is aimed at resolving persistent and legacy problems in communities,” said County Councilwoman Lisa Diller, D-Newark. “We anticipate that a few “problem” communities will participate in the launch of the program so we can gauge the effectiveness of it. If the participating communities see the NID program as helpful, we would hope to expand the program to other communities that want to participate. The NID model is a successful program that has been used in both the United States and internationally to address community issues. We think that it is time to give this program a try in New Castle County.”

“This helpful legislation will address not only civic associations and communities that are not common interest communities, but I see it as a valuable tool that will help troubled common interest communities get back on track,” said Deputy Attorney General Chris Curtin, Delaware’s Common Interest Community Ombudsman. “I look forward to working with the sponsors, both state and county on using this statute.”

Senate Bill 286 has been assigned to the Senate Elections & Government Affairs Committee.