Posted on February 6, 2024
DNREC can no longer shoulder the $10 million to $15 million annual burden of beach replenishment in the state, according to Jesse Hayden, environmental program administrator for DNREC’s shoreline and waterway management division. The agency has just launched a study to seek new funding sources, including potential cost-shares with local beach towns, and officials announced the economic analysis on Jan. 18.
“In two years, we have had large expenditures,” said Hayden. “The U.S. Army Corps of Engineers is going to ask DNREC for $10 million now. Last year, we had to write a check for $15 million to the Corps because of the many storms.”
DNREC pays for beach nourishment using funds generated by the state accommodations tax. DNREC receives one-eighth of the 8 percent hotel tax specifically for shoreline management, and funds are appropriated for the division by the Delaware General Assembly.
Some beach nourishment projects are cost-shared with the federal government. In Lewes, Rehoboth Beach, Dewey Beach, Bethany Beach, South Bethany and Fenwick Island, the Corps and DNREC share the cost of beach nourishment, DNREC officials said.
“We are here to inform the public about the economic analysis that we are undertaking,” said Sarah Bouboulis, who is a planner for DNREC. The “Economic Analysis for Shoreline Management” event drew more than 100 people online, and Hayden provided what many of them perceived as bad news.
“This is just a study we are undertaking, and over 100 people are attending,” said Bouboulis, noting broad public interest. Several mayors of local municipalities, and Tim Shaw, mayor pro tem of South Bethany, attended remotely. “Our shoreline and waterways section is spearheading this analysis. We have a project work group made up of small group organizations to get pointed feedback — the Association of Coastal Towns (ACT) and the University of Maryland Environmental Finance Center, along with Delaware Sea Grant, and the Woods Hole Ecological Survey are all part of this smaller group.”
Jesse Hayden, head of the shoreline and waterways section, said the Sussex County Council, coastal mayors and public officials will also be added to the work group.
“We have enjoyed a great collaboration with you,” he said.
In short, “Beach nourishment is making a pile of sand so we have dune and shoreline elevations. … We do it for storm protection, for recreation tourism and for habitat, like the horseshoe crab,” he said. “That then supports the migratory shorebirds, like the rufa red knot. Since the 1950s, the State of Delaware has been placing sand on the beaches to offset the chronic erosion that nature produces. Before the 1970s, it was the highway commission, and then DNREC took over.”
“We have been entrusted with this responsibility,” said Hayden solemnly.
“The cost of nourishment projects are increasing to an unsustainable level. The main reason is climate change. We see more frequent and more intensive storms. We are in the rainiest period right now of our recorded history,” Hayden said. “Beach nourishment will not solve all of the coastal storm protection methods we have. But it is still the preferred method to protect infrastructure and the economy.”
“We have placed over 25 million cubic yards of sand since we started this replenishment work,” said Hayden of the total commitment. “One truck holds about 15 cubic yards — so, over a million of these truck loads have been brought in” over the decades.
“We just brought in sand to Lewes beach this week,” said the DNREC shoreline administrator. “Most of these projects have been either at the Delaware Bay or delivered to our coastal towns.”
Bethany Beach and South Bethany have gotten the lion’s share of the sand and replenishment since 2000.
“The uptick in the number of projects and the size of projects came after we reached an agreement with the U.S. Army Corps of Engineers. We have spent $61.8 million since the 1960s, but the majority of it has been spent in the last 20 years, since the Atlantic coastal towns received so much nourishment.”
“There is a cost-sharing obligation we have with the federal government to serve these Atlantic beach towns,” Hayden said. “We are counting on the federal government to continue to fund nourishment. For the state share, we need to find new resources to add to the state budget.”
“This is the time to get ahead of the issue — not when we have run out of money. There is also a risk that federal support may be reduced in some way,” said Hayden.
The federal government has spent more than $150 million, for a total of more than $210 million going to beach replenishment, said DNREC officials.
“We would have big concerns if the federal contribution were to go away.”
“We know that we have to come back and renourish,” said Hayden of the constant battle. “The climate-change impact here is making these incidents more prevalent. We get sand to the beach by hauling through dump trucks from commercial pits, using the same vendors who supply sand to concrete plants. The sand is compatible with our beach sand. The cost of fuel has gone up the past few years. So, sand we purchase [and truck] from a pit and bring in is more costly.”
The other method of beach nourishment is to use a dredge.
“The State has engaged a dredge that we can use offshore and pump sand onto the shore,” said Hayden. “We have lost the function of some of these dredges, which break, and we know it’s not environmentally wise to continue. The unit cost of that sand has almost doubled over that 10 years.”
DNREC has two revenue streams. First is the state’s lodging tax. DNREC receives 1 percent of hotel, motel and tourist rental home income, and that has generated $2 million to $4 million for nourishment.
“To date, we at DNREC have gotten $2 million, and we expect $4 million for 2024.”
“The second is state bond bills, and we have received generous appropriations. We have to split those funds for nourishment from clearing waterways for boating and the marine debris.”
“We have $3.5 million from our state bond projections for this year.”
“We want to look at the people who are getting the benefits of local beach nourishment,” which DNREC officials said is the coastal town receiving the tourism. “What would it look like to see who benefits and calculate a structure that is shared?” he asked.
“Nothing is changing right now, and we are not asking for a local cost share. Nothing will impact current projects or future planned projects,” said Hayden of the new study’s impact.
Shaw, who is also chairman of South Bethany’s Canal Water Quality Committee, stated, “Economic benefits are not limited to the beach towns, so all who benefit should share in the funding — not just beach towns.”
According to the National Association of State Budget Officers (NASBO), Delaware’s total expenditures in the 2022 fiscal year were $15.5 billion. That’s a single year’s expenditure. The cost incurred by the State for beach replenishment over the last 75 years “isn’t even a rounding error,” said an elected official from Bower’s Beach in the virtual audience.
“As we have been told on many occasions, DNREC owns the beaches and dunes, and the beaches are open to the public, both statewide and countrywide. That being the case, why is maintaining the beaches and dunes now a local town responsibility? Why is this not a statewide funding issue?” asked Shaw during the webinar.
“Why would it not be better, and more equitable, to have a statewide tax to pay for these costs?” said Shaw.
DNREC’s division of shoreline and waterway management provided a public presentation to begin the discussion of the “Economic Analysis of Shorelines” study. The study will explore the range of economic benefits provided by beach nourishment and develop cost-share ratios and new approaches to funding projects needed to maintain Delaware’s shorelines.
Shaw said the Town of South Bethany does not believe this study is necessary and that the State of Delaware should continue to fund beach nourishment without local municipality cost sharing.
The State routinely provides monetary incentives to businesses to come to Delaware or expand business in return for the promise of additional jobs and revenue, said representatives of the South Bethany Property Owners Association. The 2012 study they referenced indicates that the coastal communities continually provide increased jobs and state revenue.
The coastal communities are an economic engine for the state through tourism dollars. A 2012 study showed that the total economic contribution of coast-related activity to the state are:
• $6.9 billion added to total industry production;
• 59,000 additional jobs supported;
• $711 million of additional local, state and federal taxes paid;
• $67 of additional production is added throughout the state for every $100 of coast-related production, said the association; and
• 48 additional jobs are added for every 100 coast-related jobs.
“The State should continue to invest in what is already here and assist with its expansion by fully funding the State’s share of beach nourishment,” said the SBPOA representative.
