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		<mainTitle nfc="0"><title>Final report of the Delaware Tomorrow Commission.</title><sectName>Appendix.</sectName></mainTitle>
		<titleVariant type="cover"><title>Report of the Delaware Tomorrow Commission to the Hon. Sherman W. Tribbitt, governor of Delware</title>.<sectName>Appendix</sectName>.</titleVariant>
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		<corpAuthor mainEntry="y"><name>Delaware Tomorrow Commission.</name></corpAuthor>
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			<subject cat="geo">Delaware</subject>
			<subject cat="gen">Economic policy.</subject>
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			<subject cat="top">Land use</subject>
			<subject cat="geo">Delaware.</subject>
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<pb n="1" />

                                                                                                    08390

           Coastal Zone
              Information
               Center

                             REPORT OF THE                                              OCT 7   1976
				     DELAWARE TOMORROW COMMISSION
				     TO THE
				     HON. SHERMAN W. TRIBBITT
				     GOVERNOR OF DELAWARE
				     APPENDIX

													COASTAL ZONE
													IFORMATION CENTER

	HC
	107
	.D3                                                                       January, 1976
	D393
	1976
<pb n="2" />

                                           FINAL REPORT

                                                OF

                                 THE DELAWARE TOMORROW COMMISSION

                                             Appendix

                                           January 1976                                 COASTAL ZONE
                                                                                        INFORMATION CENTER

                            U.S.DEPARTMENT OF COMMERCE NOAA
                           COASTAL SERVICES CENTER
                           2234 SOUTH HOBSON AVENUE
                          CHARLESTON , SC 29405-2413

                        The preparation of this report was financed in part
                        through a Comprehensive Planning Grant from the
                        Department of Housing and Urban Development (CPA-
                        DE-03-26-1010).

                                Property of CSC Library
<pb n="3" />
<pb n="4" />

                                           TABLE OF  CONTENTS

          Appendix A

                Executive Order Number Forty-Eight,  June 19, 1974
                Executive Order Number Fifty-Three,  September 9, 1974
                Executive Order Number Fifty-Six, October 2,, 1974

          Appendix B

                Section 1 - Revenues
                Section 2 - Expenditures
                Section 3 - Assumptions and Methodology for Revenue Projections and
                            Expenditure Projections From 1973 Through 1585
                Section 4 - Part V of the Report Entitled "Committee to Investigate
                            Delaware State Finances"
                Section-5 - Extracts From the Min *utes of the July 30, 1975, Meeting
                            of the Delaware Tomorrow Commission

          Appendix C

                Economic Developm*nt Committee Summary

          Appendix D

                An Analysis of Changes in the Delaware  Tax Code, 1960-1974

                Preliminary Analysis of Delaware Employment in Nine Major
                Industrial Sectors

          Appendix E
                Delaware Tomorrow Commission Meeting Minutes

                   October 2, 1974
                   April 8, 1975
                   May 27, 1975
                   June 4, 1975
                   June 9, 1975
                   June 16, 1975
                   July 2, 1975
                   July 10, 1975
                   July 23, 1975
                   July 309 1975
                   November 25, 1975
                   January 28, 1976

          Appendix F

                Dela ware Tomorrow Commission Public Hearing Transcri pts

                   January 6, 1976 - Kent County
                   January 7. 1976 - New Castle County
                   January 8. 1976 - Sussex County
<pb n="5" />

                                                SECTION III

                                                APPENDICES

                                                APPENDIX A
<pb n="6" />

                                             'TS 01F DEL,11V
                                          f

                                         EXECUTIvE DEPvrZTMENT
                                                  DovEiR

                .EXECUTIVE ORDER
                NUMBER FORTY-EIGHT

                TO:   Heads of All State Departments and Agencies

                RE:   The Establishment of the Delaware.Tomorrow   Commission

                      WHEREAS, it is essential that the State of   Delaware devise a
                statewide development policy on growth in the areas of industrial,
                commercial and residential development including open space, recreation,
                and transportation; and'

                      WHEREAS, the General Assembly has recognized these p  roblems by
                enacting specific legislation or resolutions, such as Senate Bill 257,
                House Bill 882 and House Concurrent'Resolution 49, dealing with specific
                areas of this overall general problem.

                      WHEREAS, in 1971 the State of Delaware   *enacted into law the Coastal
                Zone Industrial Control Act which regulates industries in the coastal
                areas of the State, and in the two years since the passage of this Act
                there has been considerable controversy over it and the State's policy
                on economic growth; and

                      WHEREAS, a comprehensive State development policy must be developed
                for all, but only after considering the interests of not just government
                but business, industry, labor, environmentalists, and most importantly,
                the people of Delaware.

                      NOW, THEREFORE, 1, SHERMAN W. TRIBBITT, by the authority vested.in
                me as Governor of the State of Delaware, do hereby declare and order as
                follows:

                          1. The "Delaware Tomorrow.Commission" is hereby     established.
                          2. The Commission.is charged with the responsibility to
                      develop a statewide plan for growth.

                          3. The Commission shall investigate development policy of other
                      States as well as hold.meetings and seminars throughout the State
                      to receive contributions from bur citizens.

                          4. This Commission shall submit to the Governor and the General
                      Assembly by June 1, 1975 its findings and recommendations. However,
                      the final decision as to the date of submission of the Commission's
                      findings shall rest with the Commission. At the discretion of the
                      Commission, draft legislation may be submitted to implement its
                      findings. Its report shall include but need not be limited to a
<pb n="7" />

      EXECUTIVE ORDER
      NUMBER FORTY-EIGHT                                           PAGE TWO

            strategy for inddstrial, commercial   and residential development,
            land use and statewide zoning, a policy regarding transportation,
            recreation and open space consistent with a,quality environment.

                5. The Commission shall consist    of 27 members who shall be
            appointed as follows:

                     1. Secretary, Department of   Highways and Transportation

                     2.  Secretary, Department of  Labor
                     3.  Secretary, Department of  Community  Affairs and
                         Economic Development

                     4.  Secretary, Department of  Natural Resources  and
                         Environmental Control

                     5.  Director, State Planning

                     6.  Mayor of Wilmington, or  his designee

                     7.. New Castle County Executive, or his   designee

                     SP  President, Kent County Levy  Court, or his designee

                         President, Sussex  County Council, or  his designee

                   10.   President, League  of Local Governments,  or his
                         designee

                   11.   President, Delaware State Chamber   of Commerce, or
                         his designee

                   12.   President, Building  Trades Council, or his designee

                   13.   President, State Labor Council, or his designee

                   14.   President, Delawareans for Orderly Development, or
                         his designee

                   15.   Chairman, Sierra. Club, or his designee
                   16.   President, Save  our Shores, or his designee

                   17.   Chairman, Common Cause of Delaware, or his designee
                   18.   Chairman, Coa@tal Zone Industrial Control Board, or
                         .his designee

                   19.   Chairman, Greater Wilmington Development Council,     or
                         his designee
                   26.   2 members of the House of Representatives, to be
                         designated by the Speaker of the House, one from each
                         political party
<pb n="8" />

          EXECUTIVE ORDER
          NUMBER FORTY-EIGHT                                         PAGE THREE

                        21.  2 members of the Delaware State Senate, to be
                             designated by the President Pro Tempore of the
                             Senate, one from each political patty

                        22.  4 members to be designated by the Governor

                    6.  The Chairman of the Commission shall be designated by
                the Governor and the Vice-Chairman of the Commission shall be
                designated by a majority of the members of the Commission.
                                       APPROVED tj@is.4*day of-June, 1974.

                                       ATTEST:

                                       Secyetary of State
                               @Governo
<pb n="9" />

                                                ov@ DE;i@-Ajv

                                       EXPECUTiviE DEP,%rzTMIENT
                                                DOVER

              EXECUTIVE ORDER
              NUMBER FIFTY-THREE

              TO:      Heads of All  State Departments and Agencies

              RE:      Amendment to  Executive  Order No. 48

                  WHEREAS, Executive order No. 48 establishes     a Delaware  Tomorrow
              Commission to consist of 27 members, including,four members to be
              designated by the Governor; and

                  WHEREAS, additional members are    deemed desirable   in order to
              properly consider the interests of government, business,.industry,        kaboIr,
              environmentalists, and the people of    Delaware.

                  NOW   THEREFORE, I,.SHERMAN W  * TRIBBITT, by virtue   of the authority
                                                 State of Delaware,.do   hereby,drder and
              vested in me as Governor of the
              declare as follows:

                       1. Paragraph-Sof Executive Order No. 48      is  amended by:

                           (a)  increasing the total membership of the Commission from
                                27 to 30 members;

                           (b)  increasing the number of    members to be  designated by
                                the Governor from 4 to 6    members;

                           (c)  renumbering subparagraphs.18 through     22.as subparagraphs
                                19 through 23; and

                           (d)  adding a new subparagraph 18 to read     as follows:
                                018. President, League of Women Voters, or,her designee".

                       2.  Executive order No. 48 is amended    by adding a  new paragraph 7
                           as follows:

                           "7. The Chairman of the    Delaware   Tomorrow.Commission.may
                                appoint a'secretary   and an assistant secretary for
                                the Commission, both to serve at the pleasure of the
                                Chairman."

                       3. Executive Order   No.,48 is amended by adding.a     new Paragraph 8
                           as follows;

                            *8.  In addition to the members of the Delaware     Tomorrow
                                 Commission  provided for.in this Order, the    Governor,
<pb n="10" />

     EXECUTIVE ORDER
     NUMBER FIFTY-THREE                                      PAGE TWO

                  may create subcommittees and name members to such
                  subcommittees as he deems appropriate without issu-
                  ing additional Executive Orders. A letter of appoint-
                  ment signed by the Governor shall be sufficient
                  authority for such appointee to serve on such sub-
                  committee."

                                        AP       t    9th day of      mber  1974

                                        Governor
                 A--
                                        ATTEST:

                                        Secretary of -State

                                                                                                           A
<pb n="11" />

                                                CUTIVIE DEPARTMEIVT
                                                     DOVIEIR

                      EXECUTIVE ORDER
                      NUMBER FIFTY-SIX

                      TO:  Heads of all State Departments.and Agencies

                      RE:  Amendment to Executive orders Number 48 and Number  53'

                           WHEREAS, Executive Order Number 48 establishes a  Delaware
                      Tomorrow Commission and Executive Order Number 53 amends and clarifies
                      Executive Order Number 48; and

                           WHEREAS, certain additional changes and clarifications are needed
                      to refine the structure of the Commission;

                           NOW, THEREFORE, I, SHERMAN W. TRIBBITT, by virtue of the authority,
                      vested in me as Governor Of the State of Delaware, do hereby order and.
                      declare as follows:

                           l..  Paragraph 5 of Executive Order Number 48 as amended by
                                paragraphs 1 (a) and 1 (b) of Executive order Number 53
                                isfurther amended by:

                                ,(a)
                                    increasing the total membership  of the Commission from
                                    30 to 31 members.

                                (b) increasing the number of members to be designated by
                                    the Governor from 6 to 7 members.

                           2.   Executive Order Number 53 is amended by striking in full para-
                                graph 2 and substituting in lieu thereof the following:

                                Executive Order Number 48 is amended by adding a new paragraph
                                7 as follows:

                               "(7) The Chairman of the Delaware Tomorrow Commission may
                                    appoint a secretary for the Commission. The Chairman
                                    may also appoint counsel to the Commission. Both to
                                    serve.at the pleasure of the Chairman.."

                           3. Executive-Order Number 48 is amended by-adding   a new paragraph
                                9 as follows:

                               "(9) The Governor may appoint Chairmen to the subcommittees
                                    created as defined in paragraph 8. A letter of appoint-
                                    ment signed by the Governor shall be sufficient authority
                                    for such appointee to serve as.Chairman."
<pb n="12" />

		EXECUTIVE ORDER
		NUMBER FIFTY-SIX									PAGE TWO

											APPROVED this 2nd day of October, 1974

											Governor

											ATTEST:

											Secretary of State
<pb n="13" />

                                               APPENDIX B
<pb n="14" />

                 Appendix Bcontains the bulk of the material presented to the Commission

            by the Cost of Public Services Committee in its April 4, 1975, report.

            Section 1

                 Relates to Revenues.

            Section 2

                 Pertains to Expenditures.

            Section 3

                 This section includes the assumptions and methodology for revenue projections

            and expenditure projections from 1973 through 1985.

                 In order to refine these figures relati,ng to both expenditures and revenues,

            the actual expenditures and revenues for 1974, 1975 and estimates for 1976 were

            included in the computations.

            Section 4

                 This section contains Part 5, entitled "Prospects for State Needs and

            Resources" from the April, 1969 Report of the Committee to Investigate Delaware

            State Finances, chaired by Robert W. Tunnell. This study, completed over six

            years ago, includes a thought-provoking section on forward projections of

            expenditures and revenues.

            Section 5

                 This section is comprised of extracts from the minutes of the July 30,

            1975, meeting of the Delaware Tomorrow Commission, and includes commentary on

            the subject of revenues and expenditures.
<pb n="15" />

                                         APPENDIX B -SECTION 1

                                                REVENUES
<pb n="16" />

                                                   COMMENTS

                On the following pages are six     tables which summarize revenue collections

           by the major governments in the State of Delaware for. the fiscal years 1968

           through 1973. Table I shows total revenues of the State, the three counties-

           the school districts and    the cities of Dover, Newark and Wilmington- -.-,@bles

           II and I II break down these totals into revenues from each unit's own sources

           and revenues received from sources beyond the control of the unit. Tables TV, V

           and VI show the same data: on a per capita basis.      Reviznu'L-s of governments other

           than those listed above are not included in.this report because revenue data of

           these other governments was not readily available and the benefits expected from

           including them were not.sufficient to justify the costs of collecting the addi-

           tional data. Only five years of data are presented because the purpose here is

           to focus on recent trends and events that mav.influence future revenue        collection..s

           rather than to present a more complete hisrorical analysis of revenues. Data for

           fiscal year 1974 were not yet available for all included governments at        the'time

           the prima ry data was assembled and, therefore.,    no 1974 data are presented,. The

           breakdown into revenues from own sources and external sources represents an.attemri

           to show clearly the importance to the various Delaware Governments of events be.vo,.d

           the;,-        control- The inclusion of franchise receipts in the external sources

           category is legitimately debatable but does effectively emphasize the sensitivity

           of revenues in the State to economic as well as political events outside of the

           State.
<pb n="17" />

                 Table I shows that local government revenues grew more rapidly than StatE
            government revenues in the 1968-1973 period. Tables Il and III show that this

            was true both for revenues from own sources and for revenues from externally con-

            trolled sources. (In the case of local governments, the externally controlled

            funds are all federal funds.) During the 1968-        1973 period, State government

            revenues grew at an aver-age aT   annual rate of only 13% while those of major local

            governments grew twice as fast, at a rateof 26% per year. This high growth

            rate of revenues of major local governments is primarily attributable to growth

            in county government revenues and not to growth in city, government revenues,

            While the  three county governments     experienced growth rates of 31%, 34% and 20%

            per year,  the three largest cities     in  Delaware experienced revenue growth rates

            of only 19%, 19% and 20% per, year.

                 Table  IV shows that the pattern of      more rapid growth at the local level than

            at the State government level     is repeated when revenues are on a per       capita basis.

            Tables V and VI show that Kent and Sussex       county.governments have experienced

            relatively slow per capita revenue growth       from their own, sources so that the high

            rates of increase in per capita total revenues is attributable to very high rates

            of increase in federal subsides to the counties.

                 In considering the per capita revenue tables it is important to remember that

            the figures only show total revenue collections from all sources per person resident

            in a particular jurisdiction_ They do       not show the revenues      being contributed     for

            public services, on the average,by the residents of the jurisdictions, Much of

            the variation in revenues collected per     resident is due to (1) differing degrees

            of collection of revenues from nonresidents (as        is the  case of Wilmington's wage

            tax), (2) differing amounts of taxable nonpersonal property  (as with the capital

            facilities in New Castle County) or (3) differing levels  of collections for

            essentially private services (as with Newark's .electricity rates),
<pb n="18" />

               It Is interesting to note that local revenues Of  school districts have grown

          at approximately the same rate as total revenues from all sources in the State and

          that this is true in both total and per capita terms .  While the six tables which

          follow present revenues from several useful perspectives, they do not provide

          enough information to permit reasonably acceptable projections into the future.

          This task will require a breakdown. of revenues into categories on the basis of

          sensitivity of the source to different sorts of influences. For example, some

          sources are primarily sensitive to population (alcoholic beverage taxes) while

          others respond to income changes (income taxes) or other national economic con-

          ditions (corporate income taxes) and still others are relatively insensitive to

          these influences (property taxes).
<pb n="19" />

                                                                                                   TABLE I

                                                                               TOTAL MAJOR GOVERNMENT REVENUES

                                                                                                   1968-1973

                                                                                                                        Fiscal Years

                                                                     1973             1972             1971             1970              1969            1968           Growth Rate 5
                                                                                                                 In Thousands of Dollars
                          Major Delaware Revenues 2                $581,295        $509,974          $421,578         $356,884        $296,275         $277,452               .16

                             State Government 7                     407,174         375,005           306,823          263,937          221,839          215,855              .13

                             Local Government:                      174,12".        134,969           114,755           92,947            74,436          61,597
                                Ail School Districts                 42,912           V,417            34,016           29,0056           23,6556         20,46@6 -           .16
                                Major Local Governments 3           131,209           97,552           80,739           63,942            50,781          41,193              .26

                                New Castle County:                  145,309         115,342            96,024           74,592            60,885          55,472
                                   School Districts                  35,633,          30,518           27,336           22,832            19,336          16,648              .16
                                   County Government                 48,320           25,574           26,796           12,719            13,455          13,093              .30
                                   City of Newark                     7,785            5,910            4,948            4,218            3,655            3,303              .19
                                   City of Wilmington                53,571           53,340           36,944           34,823            24,439          22,428              .19

                                Kent County                          22,556           14,343           13,945           14,105            10,232           3,306
                                   School Districts                   3,965            3,651            3,662            3,530            2,405            2,113              .13
                                   County Government                  5,173            1,644            1,464            1,434            1,459            1,193              .34
                                   City of Dover                     13,418            9,048                             9,141            6,369  5 -         -                .20

                                Sussex County:                        6,256            5,284            4,786            4,249            3,320            2,818
                                   School Districts                                    3,248            3,018            2,642            1,915            1,642              .15
                                   County Government                  2,942            2,036            1,768            1,607            1,405            1,176              .20
                                                                    174,121         134,969            114,755          9.2,946           74,437          61,596
                          Source:  Data are from Tables 7, 8, 10, 18, 19,20, 24,25 and 26 in "Statistical Tabulations", Delaware Tomorrow Commission, Cost of Public
                                   Services Sub-committee, January 16, 1975; and from William A. Brown, Department of Public Instruction.
<pb n="20" />

                                     DELAWARE TOMORROW COMMISSION

                                   COST OF PUBLIC SERVICES COMMITTEE

                                                 TABLE I

                                    TOTAL MAJOR GOVERNMENT REVENUES

                                                  NOTES

       Note I   Excludes municipal governments except Dover, Newark, and Wilmington and
                any public agencies which receive revenues other than state, county, and
                city governments and school districts.

       Note 2   Includes state government. and local government with exceptions noted
                in Note 1.

       Note 3   Includes Kent, New Castle., and Sussex  county governments and Dover,
                Newark and Wilmington city governments.

       Note 4   Growth from 1968-73 at annual rates, except where 19   68 data are missing.

       Note 5   Approximate value estimated from trends; actual data not assembled yet.

       Note 6   Sub-components do  not add  to total because of rounding.

       Note 7   Includes Federal Funds to school districts and state-agencies.
<pb n="21" />

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<pb n="22" />

                                  DELAWARE TOMORROW COMMISSION

                                COST OF PUBLIC SERVICES COMMITTEE

                                            TABLE II

                 MAJOR GOVERNMENT REVENUES FROM EXTERNALLY CONTROLLED   SOURCES

                                               NOTES

       Note I   Excludes municipal governmen.ts except Dover, Newark, and Wilmin.-ton and
                any public agencies which receive revenues other than state, county, and
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       Note 2 - Externally controlled sources include Federallfunds allocated to school
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<pb n="23" />

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<pb n="24" />

                                          DELAWARE TOMORROW COMMISSION

                                        COST OF   PUBLIC SERVICES COMMITTEE

                                                      TABLE.III

                               MAJOR GOVERNMENT REVENUES FROM:DELAWARE SOURCES

                                                         NOTES

          ,Note  1 -'Excludes municipal. governments except Dover, Newark, and Wilmington and
                      any public agencies which receive revenues other-thanstate, county and
                      city governments and school districts.

          Note  2     Delaware sources    exclude Federal funds      allocated to school    districts
                      and state agencies, Federal Revenue Sharing funds (to the state governments,
                      the three county    governments of  Dover, Newark, and Wilmington), franchise
                      taxes and grants    and donations.

          Note  3     Includes state government and, local government with exception     noted in
                      Note 1.

          Note 4.     Includes Kent,New Castle,and Sussex county government's and Dover,
                      Newark,, and Wilmington city     governments..

          Note 5      Growth from 1968-1973-at annual rates, except where   1968 data  are
                      missing.

          Note 6      Sub-components do not add to       total  because of rounding.

          Note 7     Includes  Federal funds to school,districts and state agencies.
<pb n="25" />

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<pb n="26" />

                                      DEIAWARE TOMORROW COMMISSION

                                    COST OF PUBLIC SERVICES COMMITTEE

                                                TABLE IV

                               PER CAPITA TOTAL MAJOR GOVERNNENT REVENUES

                                                  NOTES

           Note 1   Excludes municipal governments except Dover, Newark, and Wilmington and
                    any public agencies which receive revenues other than state, county,
                    and city governments and school districts.

           Note 2   Includes state government a nd local government with exceptions noted
                    in Note 1.

           Note 3   Includes Kent, New Castle, and Sussex county governments and Dover,
                    Newark, and Wilmington city governments.

           Note 4   Growth from 196.8-1973 at annual rates, except where 1968 data are
                    missing.

           Note 5   Does not  include data for city of Dover, 1968,

           Note 6.  Sub-components do not add  to total because of rounding.

           Note 7 - Includes Federal funds  -to school districts and state agencies.

           Note 8 - Population of state is  used as divisor,
<pb n="27" />

                                                             DELAWARE TOMORROW COMMISS ION

                                                           COST OF PUBLIC SERVICES COMMITTEE

                                                                         TABLE  V

                                                       .,PER CAPITA MAJOR GOVERNMENT REVENUES

                                                          FROM EXTERNALLY.CONTROLLED SOURCES1,2

                                                                                    Fiscal Years                                           Growt
                                                      9 3          1972           1971          1970           1969           1968           Rate
                                                    L-7

                                                                               Actual  Dollar Amounts

               Ma'or Delaware kcvertues3                            254.7
                                                                                                                                             .16

                  State  Government                  271.4          242.5          201.6                        121.5          146.2         .13

                  Local  Goverrrment
                      All School Districts
                      Major Local GovernmenLs4        42.8           12.2           8.9             6.1          4.0:            4.8         .55
                                                                                               =7

                      New Castle County,
                         School Districts
                         County Government            19.0           3.0            1.9              81           ..65           .81         .88
                         City of Newark               .3@. 5         8.4            13..8                       .10.4            9.1         .34
                         City of Wilmington          146.4           67.5           47.3          32.1           20.6                        .42

                      Kent County-
                         School Districts
                         County Government            38.7           1.2            i.3              .1            -5             .1        2.29
                         City of Dover                               2.0            8.3            9.9             .5                        .83

                      Sussex County:
                         School Districts
                         County Government            12.1           1.3

               Source:   Table II  and population. figtires which are U. S. Census    figures,from
                         Delaware  Statistical Abstrapt, 1974,
<pb n="28" />

                                      DELAWARE TOMORROW COMMISSION

                                    COST OF PUBLIC SERVICES COMMITTEE

                                                 TABLE V

                                  PER CAPITA MAJOR GOVERNMENT REVENUES

                                  FROM EXTERNALLY CONTROLLED SOURCES

                                                  NOTES

          Note 1    Excludes,municipal governments except Dover, Newark, and Wilmington and
                    any public agenci .es which receiverevenues other than state, county, and
                    cIitIy gove.rnments and school districts.

          Note 2    Externally controlled sources i.nclude.Federal.fun,ds.allocated to school
                    district and state agenci Ies, Federal Revenue Sharing funds. (to the state
                    government, the three county governments and the governments of Dover,
                    Newark, and Wilmington), franchise taxes"and all grants and donations.

          Note 3    Includes.state government and local government with exception noted
                    in Note 1.

          Note 4    Includes  Kent, New Castle, and Sussex county governments and Dover,
                    Newark, and Wilmington city governments.,

          Note 5    Growth from 1,968-1973 at annual rates, except where   1968 data are
                    missing...
          Note 6    Includes Federal funds to.school districts and state   agencies.

          Note 7 -.Population of  state  is used as. divisor.
<pb n="29" />

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<pb n="30" />

                                     DELAWARE TOMORROW COMMISSION

                                   COST OF PUBLIC SERVICES COMMITTEE

                                                TABLE VI

                                 PER CAPITA MAJOR GOVERNMENT REVENUES

                                         FROM DELAWARE SOURCES

                                                  NOTES

          Note 1   Excludes municipal,agencies governments except Dover, Newark and
                   Wilmington and any public agenc'ies which receive revenues other than,
                   state, county, and city governments and schooldistricts.

          Note 2   Delaware sources exclude Federal funds allocated to school districts
                   and state agencies, Federal Revenue Sharing funds.(to the sta   Ite governments,
                   the three county governments.of Dover, Newark, and.Wilmington)    franchise
                   taxes and grants and donations.

          Note 3   Includes state government and   local government with exception noted
                   in Note 1.

          Note 4   Includes Kent, New Castle, and Sussex   county government and Dover,
                   Newark, and Wilmington city governments.

          Note 5   Growth from 1968-1973 at annual rates,   except where 1968 data  are
                   missing.

          Note  6  Does not include data for city   of Dover, 1968,

          Note'7   Population of  state is u.sed as divisor.
<pb n="31" />

                                          APPENDIX B   SECTION 2

                                               EXPENDITURES
<pb n="32" />

                                                 INTRODUCTION

                    This report summarizes      historical data about the categorical        costs o f
               public services provided by      the State of Delaware and     its local governments
               (counties, municipal i ties and school districts) for the fiscal years 1960'
               to 1973; the categories are those of the U.S. Bureau of the Census Classi--5'-
               ication  System.    The. year 1973 is the last for which data are as yet avail-
               able under this classification system, and compar        Iable data for .1974 are not
               readily  4,@alilable directly from governmental financial records.

                    The direct    categorical ;axpenditures of the state and        of local govern-
               ments in the aggregate are presented in        five tables.    The term "direct"
                                01
               means that expenditures are assigned to        the recipient level of government;
               for example, state. aid to school districts is included in the expenditures
               of local governments for education,.,

                    Table I shows the.absolute amount of,       expenditures. Tables 2     and .3 show
               the same data on percentage and per capita bases.. 'Table 4 shows selected.
              ..statistics on absolute and per.capita amounts of debt.          Table  5  shows the
               contributions of gove   rnment to pension funds.;      Each of tl@ese  tablesis d,is-
               cussed below with the@   .focus in the combined expenditures of state and local
               governments in orden-to-s                tal-cost-of
                                            how. the-to.    c       --government in   Delaware..

                    Individual data. collected     for the  counties.of New Castle, Kent and
               4usse.., the three municipalities of,Wilmington, Newark,         and Dover, and    the
                       districts are not presented here.
<pb n="33" />

                                         ANALYSIS    OF  TABLE   1

                   The  schedule below, abstracted   and  developed from Table   1,  shows the
              absolute  and proportionate   increases in  categorical  exoenditures    between
              1968 and  1973.  Capital outlay and current operations are shown separately
              for those categories where data-were available. Expenditures for all cap-
              Ital outlay increased 55 percent, or 9.2 percent on an average annual
              basis, from $111.7 million in 1968 to $173.1 million in 1973; current..op      er-;-
              ations increased 106 percent, or 15.6 percent annually, from $227.9 million
              to $470.3 million. During. this five-year period the population increased
              by 7 percent, or 1.4 percent. annually, from.535,000 to 573,000.

                   Education showed the   largest absolute increase of $151 million, or
              108 percent, while fire protection. showed the smallest increase of $1.2
              milli-on, or 57 percent.   Sewera,-e and parks and recreation showed the two
                                                C)
              largest proportionate increases of 304 percent (32 percent annual average',
              and 388 percent (37 percent annual   .average) respectively, while highways
              had the smallest increase of 24 percent (4.3 percent annually). Education
              showed the largest increase in capital outlay of $26.5 million (74 percent
              or 12 percent annually) while health and hospitals. showed. no -incr.ea se a-t
              all; education also showed the largest increase in current operations of
              $124.4 million (120 percent, or 17 percent annually), while sewerage showed
              thesmallest increase of $1.3 million (50 percent, or 8.4 percent annually).

                   it should be no-ted that absolute   increasestor capital outlay are more
              erratic.than those for current operations, so that proportionatechanges.in
              the former are less instructive than those of the latter.         ProT)ortionate
              changes in capital outlay are miuch mote affected by     the, selectlon of the
              base year.
<pb n="34" />

                                                 ABSOLUTE AND PROPORTIONATE INCREASES
                                   IN CATEGORICAL EXPENDITURES BETWEEN 1968 AND 1973
                                                (J@ibstracted.and Developed from Table 1)

                                                                                          Amount
                                                                                        (Millions)                                    % A
                                                                                                                                            Annual
                                                                                  1968           1973            $                Total     Avg

                           TOTAL                                              @339.6          $643.4           @303-8             90        13.6
                               Capital outlay                                     111.7          173.1           61.4             55          9.21
                               Current Operations                             .227.9             470.3           242.4            106       15.6
                           Education                                              139.5                          150.9            108       15.8
                               Capitaloutlay                                      .35.6.         6.2.1           26.5             74        fl.8
                               Current operations                                 103.9          228.3           124.4.           120       17.0
                           Highways                                               66.8           82.6            15.8             24          4.3,
                               Capital outlay                                     49.8           65.7            10.9             22          4.3
                               Current operations.                                17.0           21.9              4.9            29          5..21
                           @Pu@bl i c,.. Wel f ar e                               21.9           49.1            271.21           124       17.5
                           Health &amp; Hospitals                                     18.5           30..7           12.2             66        10.7
                               Capital outlay                                     3.4             3.3              0.1)           (3)
                               Current operations                                 15.1           27.4            12.3             81        12.7
                           Pdlice Protection'                                     @7.2           17.1              9.9.           138.      18.9
                           Fire Protection                                        Ll.             .3.3             1.21           57          9.5
                           Sewerage,                                              4.7            19-0            14.3             -304@     32.2
                               Capital       outlay                               2.111          15. 11          .13.0            6.119     48.4
                               Current       Operations                           2,.6.           3*-. 9           l..3           50          8.4
                           Sanitati        Ion                                    2.0             4-1              2.1            .105      .15.4
                           Parks--&amp;--Re-crL-at-ion                                1-7                                             -38.8,    37.3
                           Financial.Administration                               5.1:           10.4...           5@. 3.     -.104         15.3
                           General Control                                        7.4            17.3.             9.9            134       18.5
                           Interest on General                 Deb@               19.9           33.0            1@3. 1           @66       10.7
                           All Other                                              43.1           77.7            34.6             80        12.5
                               CapitalL      Ou tl-ay                                            31.5            10.7             51          8.7
                               Cur.rent      operations                           22.3           46.2            213.9            167       115.7

                                           *Expressed.as a               compound       growth rate.
<pb n="35" />

              Interest on general@debt-increased,66.percent, or 10.7 percent          on an
        average annual basis, from @19.9 million to $33.0 million. . Debt retire
        ment, analyzed in detail in Table 4, increased.48 percent, or 8 percent on
        an average annual basis, from $30.5 million in 1963 to $45.0 million in           1973.
       -Contributions to pension funds, analyzed      in detail in Table 5, increased
        from $4.9 million to $20.3 million.
              in the schedule below, amounts.for      debt retirement and pensions are
        added to total expenditures for current       operations in 1968 and 1973 to com-
        plete the picture.

                                                             Amounts in Millions
                                                                  1968       1973

                    Current Operations    .(Table 1)              227.9    $  470.3
                    Long-term Debt   Retirement (Table    4)       30.5       415.0..
                    Pensions (Table   5)                            4.9       20. 3
                    Total                                                  $  535.6
<pb n="36" />

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<pb n="37" />

                                                  ANALYSIS OF TABLE 2

                                                                                       The sched-..
                  Table  2 shows   the data in Table 1     on a percentage basis.
            ule below,    derived  from these tables, shows categorical expenditures as
            a percentage of total direct expenditures for 1968            and 1973.   The distinc-
            tion between capital outlay and current operations            is made wheredata
            permit.
                                                                          Amounts in
                                                                          Percentages
                                                                          1968  @1973

                              TOTAL                                       100      100
                                  Capital  Outlay                         32.9     26.9
                                  Current'Operations                      67.1     73.1
                              *Education                                  41.1     45.1
                                 .,Capital Outlay                                  9.6
                                  Current  operations                     30.6     35.5
                               Highways                                   19.7     12.8
                                  Capital  outlay                         14.7     9.4
                                  Current  Operations                     5.0      .3.4
                              *Public Welfare                             6.4      7.6
                               Health &amp; Hospitals                         5.4   -4.8
                                  Capital Outlay                          1.0      0.5
                                  Current Operations                      4.4      4.3
                              *Police Protection                          2.1      2.6
                               Fire Protection                            0.6      0.5
                               !@Sewerage,                                1.4      2.9
                                  :Capital Outlay                         0.6      2.3
                                  Current Operations                      0.8      0.6
                                Sanitation                                0, 6     .0.6
                               Parks &amp; Recreation.                        0.5      1.3
                               Financial Administration                   1.5      1.6
                               General Control                            2@2      2.7
                               Interest on General     Debt               5.8      5.1
                               All other                                  12.7     12.1
                                  Capital  outlay                         6-1      4.9
                                  Current   Operations                    6.6      7.2

                    Between   1968  and 19,73 the relative burden      of certai -n categories  of
              expenditure    (measured  as a  percentage of total     direct ex*penditures) in-
              creased in so-me insta   .nces and decreased in     others.    The starredcatego    .rie.s
              are those whose relative.burden has increased, while the unstarred cate-
              gories  are those whose      relative burden has   decreased or      remained unchanged.
<pb n="38" />

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<pb n="40" />

                 Education changed from 41.1 percent to 45.1 percent, and most of this
            vas attributable to current operation; the relative burden attributable to
            capital outlay actually decreased.  Highways changed from 19.7 percent to
            12.8 percent, and health and hospitalsfrom 5.4 percent to 4.8 percent; in
            both cases the relative burden of capital outlay and current operation d-..
            creased. Sewerage changed from 1.4 percent to 2.9 percent; the relative
            burden of capital outlay increased, while current operations decreased
            slightly.

                 The relative burden of interest on general debt decreased slightly
           .from 5.8' percen t to 5.1 percent., Deb" retirement (analyzed in Table 4)
            increased direct expenditure for current operation by 13.4 percent in
            1968 and 9.6 percent in 1973. Contributions to pensions funds (analyzed.
            in Table 5) added 2.2 percent in 1968 and 4.3 percent in 1973.
<pb n="41" />

                                           ANALYSIS OF TABLE      3

                    The absolute amounts in    Table  I are shown on a per   capita  basis in
               Table 3.   Per capita ficglures in theschedule below were     abstract(@d from
               Table 3 for 1968 and 1973.      Per capita expenditures for capital outlay
               increased 43 percent, or 7.5    percent on an average annual basis, from.
               @209.25 to,$300.52, while current operations increased 91 percent, or 14
               percent on an average annual basis, from $4,26.75 to $816.49.

                    Education accounted for the single largest increase of $242.8.9
               ($40.92 for capital outlay and.$201.98,for current operations). The in-
               crease of $24.15 ($2.2.93 for capital outlay.and $1.92 for current opera-
               tions) for sewerage and $11.35 for parks andrecreations accounted for
               the two largest proportionate increases of 273.percent (30 percent annually)
               and 366 percent (36 percent annually), respectively; the increase of .$18.40
               for highways (@12.02 for capital outlay and $6.38for current operations)
               was the smallest proportionate increase at 15.percent (2.7 percent annually.)

                    Per capita amounts for capital outlay are less instructive than for
               current-operations f or- reasons --similar to those-: gi.verr-in-the  analysis-of
               Table 1.
<pb n="42" />

                                                                                               MW

                    In the schedule below, per   capita amounts for debt retirement and pen-
               sion are added to the per capita expenditures for current operations in
               1968 and 1973 to complete the picture.,

                                                                  1968       1973

                         Current Operations (Table.3)           $ 426.75      816.49
                         .Long-term Debt Retirement (Table 4)       57.22      78.12
                         Pension5-(Table 5)                          9.16     35.  41
                                                                 $,493.13     930.02
<pb n="43" />

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<pb n="45" />

                                                                             Per Capita Amounts                                  Percent of Increase
                                                                          1968         1973       Increase                  Total       Annual Average
                           TOTAL                                         $636.00,     $1,117.01    $48 1.0-1                  75                 12.0
                              Capital Outlay                              269.25          300.52       91.27,                 43                 7.5
                              Current Ope   Irations                      426.75          816.49       3819.74                91                 13.8
                           Education                                      261.22          504.11,      242.89                 93                 14.0
                              Capital Outlay                                66.80         107.72       40.92                  61
                              Current Operations                          194.41          396.39   .201.98,                   104                15.3
                           Highways                                       125.00          143.40  '    18.40                  15                 2.7
                              Capital Outlay                                93.24         105.26       12.02                                     2.4
                              Current Operations                            311.75          38.13       639                   20                 3J,
                           Public Welfare                                   40.94           05.27      44,33                  108                .15.8
                           Health and Hospitals                             34.67           53.38      18.71,                 64                 9.01
                              Capital Outlay                                .6.46           .5.88      (0.58),                (9)                0.8)
                              Current Operations                            28.20           47.51      19.31.                 68                 .111.0
                           Police Protection                                13.55           29.76      .16.21                 120                17.0
                           Fire Protection                                   3.85           5.64        1.79                  46                 8.0
                           Sewerage                                                         33.00      24.15                  V3                 30.1.
                              Capital Outlay                                 3.96           26.19      22,23                  561                46.0
                              Current Operations                             4.89           6.81        1.92-                 .39                6.8
                           Sanitation                                        3.72           7.15        3.43                  92
                           Parks and Recreation                              3.10           14.45      11.36                  366                36.0
                           Financial Administration                          9.40           17.97       8.57                  91                 13.8

                           General Control                                  13.78           3.0.18     16.40                  119                17.0

                           Interest on General Debt                         37.25           57.81      20.56                  55                 9.2

                           All Other
                                                                            80.61         134.01       54.20                  67
                              Capital Outlay                                39.02           64.68      15.66                  40                 7.0
                              Current Operations.                           41.59           80.13      38.54                  93                 14.0

                           *Expressed asa compound growth rate.

                                  Interest on general,                debt    increased by             $20.56,,or        9..2    percent on          an
                         average       annual basis. Long-term                     debt re.tirement,(analyzed                    in Table 4)
                         increased from $57.22 in.1968                        to $78.12iin             103,     or 6.5 percent-annually.
                         Contributions to pension funds (analyzed in Table 5) were $7.76 in 1968
                         and    $33.38 in         1973
<pb n="46" />

                                       ANALYSIS OF TABLE 4

                  Table 4 shows tha  t long:.-term debt retirement ranged from $30.5 million
             in 1968 to $45.0 million in 1973, and the average annual amount was $39.8
             million.   State debt retirement ranged from $21.5 million to $33.0 miliion,
             and the average annual amount was $23.5 million.       Local government debt re-
             tirement ranged from 88.4 million to *16.S million, and the average annual
             amount was $11.3 million.

                  The schedule below, derived from Table 4, shows state and local debt
             retirement as a proportion of total debt retirement for 1968 and 1.973.
             The relati've shares have not changed much; the state's share increased
             sli-htly from 71 percent to 73 percent, while the local governments' share
             decreased from 29 percent to 27 percent.

                                              1968                  1973
                                        Amount                Amount
                                      (Millions)    %       (Millions)

                        Tot al          $30.5       100       $L5.0      100
                        State            21.5        71        33.0       73
                        Local             9.0        29        12.0       27

                  In 1973 when total state direct expenditures were $352.2 million, debt
             retirement, which is not included in the amount, of $33.0 million added
             about 9 percent to rhese expenditures.     Total local direct expenditures were
             _$291.2 million, and debt retirement of $12.0 million added about 4-percent
             to these expenditures.

                  On a per capita basis Table 4 shows that debt retirement ranged from
             $57.22 in 1968 to @78.12, and this is an average annual 3.ncrease of 6.5
             percent.   State debt retirement ranged from $40.34 to $57.29 for an average
             annual increase of 7.5 percent, while local debt retirement ranged from
             $16.88 to $20.83 for an average annual increase of 4.5 percent.       During this
             five-year period population increased by 1.4 percent on an average annual
             basis.
                At the close of fiscal 1973, outstanding long-term debt was $512.5
           million for the state, an increase of 40 percent over 1968, and it was
           312.5 million for local governments, an increase of 28 Dercent over 1968.
           On a per capita basis these amounts were $889.76 and $542.53 respectively,
           an. increase since 1968 of 30 percent for the state and 1@ percent for lo-
           cal governments.
<pb n="47" />

                                                                                                     so M a*

                                                                                                     TABLE 4

                                                                      STATE AND LOCAL DEBT, SELECTED STATISTICS: 1968-1973
                                                                                           ITotal Amounts in Millions)

                                                               1973                  1972                  1971                  1970                  1969                  1968
                                                        Total    Per Capit    Total    Per Capita Total _Per Cpl@tta Total Per Capita Total              Per Capi a Total      Per Capita
                           Long-term Debt
                            Retirement                 $ 45.0    $    78.12  $ 41.3    $    73.10  $ 42.2    $    75.49  $ 45.3    $    82.66  $ 34.5    $    63.89   $ 30.5   $    57.22
                              State                       33.0        57.29     29.8        52.74     31.9        57.07     28.5        52.01      26.1       48.33      21.5       40.34
                              Local                       12.0        20.83     11.5        20.36     10.3        18.42     16.8        30.65       8.4       15.56        9.0      16.88
                              Debt Outstanding
                               (end of Fiscal Year)      870.4     1,511.11    811.5      1,436.28   736.4     1,317.35    709.9     1,295.44    709.3     1,313.52    622.2      1,167.35
                           Short-term                     45.4        78.82     37.2        65.84     31.0        55.46     22.9        41.79      13.9       25.74      12.4       23.26
                              State                       27.8        48.26     17.1        30.26        2.0        3.58       2.9        5.29       2.8        5.18     -           -
                              Local                       17.6        30.56     20.1        35.58     29.0        51.88     20.0        36.50      11.1       20.56      12.4       23.26
                           Long-term (General Debt)      825.0     1,432.29    774.3      1,370.44   705.4     1,261.90    687.0     1,253.65    695.4     1,287.78    609.8      1,144.09
                              State                      512.5       889.76    471.6       834.69    431.4      771.74     418.0       762.77    426.4       789.63    366.0       686.68
                              Local                      312.5       542.53    302.7       535.75    274.0      490.16     269.0       490.88    269.0       498.15    243.8        457.41

                           Source: U. S. Bureau of the Census, Governmental Finances. Per capita amounts computed.
<pb n="48" />

                                        ANALYSIS OF TABLE 5

                Table 5 shows that in fiscal 1973, $20.3 million was contributed for
          pensions, and this amount includcs $17.6 million from the state and $2.7
          million from local governments; on a per capita basis these amounts were
          respectively, $305.41, $30.65 and $4.76.

                The $55.41 represents an increase of 286 percent over the 1968 fi.aure
          of $9.16, but much of this fncrease is attributable to 1973 when the state
          began to contribute to the pension fund on an actuarial basis.

                                                 TABLE 5

                           STATE AYD LOCAL CONTRIBUTIONS TO PENSION FUNDS
                                           FISCAL 1968-73
                                        (Amounts in Thousands)

                                State              -Local                  S&amp;L
                                     Per                  Per                   Per      %
           Year            Total    Capita     Total     Capita     Total       Capita  in p.c.

           1968            3,499     6.53      1,412      2.63      4,911         9.16      -
           1969            3,722     6.83      1,399      2.57      5,121         9.40      3
           1970a           4,254     7.76      1,550      2.83      5,804       10.59     13
           1971            6,220    11.17      1,857      3.33      8,077       14.50     37
              _a
           1974 b          7,335    12.85      2,393      4.19      9,728       17.04     18
           1973           17,568    30.65      2,729      4.76      20,297      35.41    108

           Source:   State Pension  office, Financial Records of Local    Governments and
                     U.S.-Bureau of-the-Census, Finances-of Employee Retirement-S,
                                                                                        ;-s-
                     .tems of State and Local Governments 1968-73.

                     aAn additional $5 million in 1970 and $ 1 million in 1972 was
           appropriated from. the General MOLors Divestiture Fund.

                     bIncludes $9 million from serial notes to supply actuarial re-
           quirements.   PriDr to 1973, the state pension fund was not fully funded
           on an actuarial basis, and state contributions to this fund were trans-
           ferr--,' annually from the General Fund to provide for payrnancs to benefi-
           ciaries.

                     cLocal pension funds are not now, or have not al,..:ays been,fully
           fundo-d in all instances on an acz:uarial basis. As a resL_Iz, contributions
           to pension funds include some paymenLs to beneficiares th-It were made from
           GL:@,@ral Funds.
<pb n="49" />

                                           APPENDIX B -,SECTION. 3

                           Assumptions and  Methodology for Revenue Projections
                           and Expenditure  Projections From 1973. Through 1985
<pb n="50" />

                              ASSUMPTIONS AND METHODOLOGY FOR REVENUE PROJECTIONS

                     In each of the following sections, a relationship between revenues that

               existed in Fiscal Year 1973 is used as the basis for making projections to 1.35.

               To the extent that 1973 represented a "typical" fiscal year for each relationship,

               the projections may be considered useful. Additional assumptions are made in

               each  section. The importance of these-assumptions cannot be overemphasized; the

               numbers produced are completely dependent upon the assumptions.

               State Franchise Tax Revenues

                    Revenues will remain constant at the 1973       level in  real  terms. The number

               of dollars received will increase as more firms.pay the        maximum  and if enforce-

               ment continues to improve. These increased receipts may         be, just enough to keep

               pace with  expected inflation of 5.15% per year. Other states.are also becoming
               more competitive with Delaware for incorporation so'that it will,be difficult

               to expand revenues from the franchise tax by attracting new firms.

                  1973         1985 Collections                            1985 Collections*
               Collections (in 1973 Dollars)                               (in 1985 Dollars)

               $43,008,488       548,008,488                                  $87,706,707
               *1,8269 = (1.0515)1.2

               State Personal Income Tax Revenues

                    Personal Income Tax revenues     will increase as    the number of people in

               the State increases.. Revenues will also increase as        people's money incomes

               increase and as they   move upward into the higher tax      bracke ts of the progressive

               rate structure of the tax. Increases in money incomes are attributable to            two

               sources: (1) simple price and wage inflation causes.money incomes           to rise  and
              .(2) real economic growth permits real per capita incomes to grow.           If only
<pb n="51" />

                the first factor was operative, 1973 per capita income         taxes could be simply..

                inflated by the   exoected annual inflation     rate of 5.15%,to yield the 1985

                level of per capita income     taxes. The probability that real economic growth

                will permit an expansion.of     real per capita incomes means that       the per capita

                income tax must increase.more      rapidly   than inflation. Alreasonable assumption.

                for the twelve year period     from 1973   to.1985 might be.that real economic growth,
                will av.erage,3% per capita    per  year.    (This.means that total..real   growth will.
                be in excess of N per      year but some   will be required just,to.maintain      the per
                capita incomes   of an increasing number     of people.)    Thus, per   capita.money

                incomes may increase at about 8.15% per       year.   Without using thedistribution

                of  individuals  in each tax bracket and     sPecific  changes   in that distribution

                an accurate prediction of what an increase       of.8.15%   per year  in per capi.ta

                money,incomes will produce in income tax revenues is         impossible. A    conservative

                assumption might be that such taxes will,      rise'.by 8.15% per year. Therefore,

                percapita personal income taxes in 198.5       would be 2.56 times as high       as,they

                were in.1973 (1.081512      2.56).

                     1973 Per   Capita                1985 Per Capita             .1985 Total    Income@
                         Income Tax                    Income Tax                         Tax

                          $192.49                       $492.77.                      $344,939,491
                                                    Plus Fiscal   Year  1974
                                                       10 %  Rate Change                  34,493,949

                                                                                      $379,433,440

                Flat Dollar Amount State    Tax Revenues

                      Revenues  from the  Motor Fuel, Alcoholic     Beverage,  Cigarette Taxes and     all

                Motor Vehicle   fees except the'documents     fee are  based on a   number of units   rather,

                than a percentage of value. Thus, these..revenues will only          expand  as the

                number of  units  ih.the.State does, or      aspopulation-does..    Thus, these.taxes
<pb n="52" />

             are projected and remaining constant in per  capita terms  through 1985.

             All,Other State and Local Revenues

                  While other revenue sources might be treated indiv  idually,,none is nearilf,

             as large as any of the preceding ones. Furthermore, many of the larger sources

             among the remaining revenue sources seem logically to be closely tied, in real

             terms, to population. Thus,all other.State and local revenue sources are

             projected as remaining constant in 1973 dollars in.per capita terms. The 1985

             level in 1985 dollars is produced.by multiplying by 700,000 people and inflating
             at a rate of 5.15% per year.

             Federal Funds to State and Loc al Governments

                  Projecting future federal policies is extremely hazardous. However, there

             are several possible constraints on the level of federal funds available to the
             State. First of all, it is unlikely that.there will be a net reduction in total

             federal funding in real dollars. This  would require the elimination or sub-

             stantial reduction of programs and such actions do not seem likely.    Further-,

             more, with expanded federal funding for areas such as health care and  mass

             transit proposed,.any reductions in 'some programs are.likely to be  offset-by

             expansions.in others. Thus, a floor to future federal funding might be the pr-sent

             level of such fund ing. On the other hand, we have observed a continuously rising

             demand for public activity as personal.incomes have risen. It would be un-

             realistic to fail to expect growth in real terms in the level of federal ex-

             penditures. However,  expansions in federal funding are basically limited by

             the willingness of taxpayers to finance.ificreased spending., If one is.willing

             to assume that taxpayers will continue to support a division of.government

             activity between the federal government and state and local governments
<pb n="53" />

               approximately  like the present  one, then a reasonable approach   is to assume

               that federal funding received   by the state  and local governments will remain

               a constant proportion of  total state  and local  government revenues. Thus, the
               federal portion of total  revenues in  1985 -may,be approximately the  same as it,

               is in 1973.

               1973 Federal      1973 Total       1973 Non-Federal     1973 and .1985 Ratio of
                 @Funds           Revenues             Funds           Federal to Non-Federal*

               $132,046,Q0     $529,818,985         $397,772,985                .3320

                    *Note that this ratio is the same as   the ratio  of per capita' federal
                     funds to Der capita non-federal funds...
<pb n="54" />

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<pb n="55" />

                Local Government

                      It was assumed that the 1973 expenditures        per capita  would remain.constant.
                This  figure was  t.hen multiplied by 700,000 (projected      1985 population) to yield

                1985  expenditures.

                State General Fund

                      The 1973 per   capita  expenditures   were multiplied by    700,000  to.1yield.198.5

                costs in  1973 dollars for    police protection,    fire protection, general controlt

                debt  service and the "all-   other" categories.     Assumptions used.in.the remaining

                categories   are as follows:

                      Education
                           An estimated   1985 expenditurelevel      was produced by applying the

                      average annual increase 1973-76 in      real  dollars. Itwas assumed,this

                      level would then remain constant 1977-85. The         Public Educat  ion costs

                      were calculated by multiplying     the per capita   1976 costs times 700,000.

                      Highways and Transportation

                           Highway expenditures were determined by multiplying         the 1976   per,

                      capita costs times 700,000. Transportation systems costs          were projected

                      to increase 10% per year 1976-1935 in real dollars.

                      Public Welfare

                          'The.1976  per  capita  expenditurel.wag   assumed  to remain  constant  and
<pb n="56" />

                   and was multiplied times   700,000 to yield 1985 costs.

                   Health and Hospitals

                         It was assumed that one half of the  se expenditures are growth

                   responsi ve and therefore, the 1976 per capita costs were multiplied by

                   700,000 divided.by 2. The other increases in expenditures,are for new
                   program costs, and were expected    to equal 50% of the 1976 expenditures

                   times 7% annual growth 1976-1985.

                   Sewera2e and Sanitation

                         The 1976 per capita expenditures were assumed to remain constant

                   and were multiplied by 700,000 to yield 1985 costs.

                   Parks and Recreation
                         the 1976 per capita costs were projected to increase.2% annually

                   1976-1985 in real dollars. This figure was then multiplied by the 1985

                   population project.ion of 700,000.

                   Financial Administration,

                         The 1973 per capita average was projected to increase    1% annually

                   in real dollars and was multiplied by 7005000.

                   Pensions

                         The 1976total in 1973 dollars was projected     to Increase 5%  annually

                   .1976-1985.

                   An estimated annual inflation rateof 3% for the 1973-1985      period was

              used in conver tinq 1973 dollars into 1985 dollars.
<pb n="57" />

                                                                 M                                                       '90 so '1W                                    so "am                             'no AM

                                                                                                               TABLE 11

                                                                             1973 AND PROJECTED 1985 GOVERNMENTAL EXPENDITURES
                                                                                                                BY TYPE
                                                                                                          (Millions of Dollars)

                                                                                                                                           1973 Per          Total 1985                                   1985 Local
                                                                                     1973 Local        1973 Total         1973 Per       Capita Local       Governmental             1985 State        and All Other
                                                  1973 Total        1973 State.      and Other         Per Capita      Capita State and All Other          . Expenditures          Expenditures        Expenditures
                                                Governmental General Fund          Governmental Governmental General Fund Governmental                      1985       1973       1985       1973         1985 1973
                                                                   Expenditures     Expenditures Expenditures          Expenditures Expenditures           Dollars    Dollars Dollars        Dollars   Dollars Dollars

                   Education                         $228.3            $126.7            $101.6          $ 398.4           $221.1            @$177.3      $   680.6    $270.3   $ 368.1      $146.2    $312.5    $124.1
                   Highways                             21.9              .11.8             10.1               38.2           26.6              .11.6          121.6      48.3       90.7       36.0      31.0      12.3
                   Public Welfare                       49.1              24.01            .25.1               85.7           41.9              43.8           175.8      69.8       99.5       39.1      77.3      30.7
                   Health and Hospitals                 27.4              21.0              6.4                47.8           36.6              11.2           87.6       34.8       67.9       27.0      19.6       7.8
                   Police Protection                    17.1                7.5             9.6                29.8           13.1              16.8           .59.4      23.6       23.2        9.2      29.7      11.8
                     ire Protection                       3.3               0.3             3.0                  5.8            0.5               5.2           10.1       4.0          1.0      0.4       9.1       3.6
                   Sewerage and Sanitation                8.0                               7.1                14.0             1.6             .12.4           28.2      11.2         6.3       2.5.     22.0       8.7
                   Parks and Recreation                   8.3               1.4             6.9                14.6             2.4             12.6            30.5      12.1         9.3       3.7      21.2       8.4
                   Financial Administration             35.1a             29.8B             5.3                6.1.3          52.0                9.2          119.4      47.4       103.0      41.0      16.1       6.4
                   General Control                      17.3              10.1              7.2                30.2           17.6              12.6            53.1      21.1       31.0       12.3      22.2       8.8
                   Pensions                             22.4              19.0b             3.4                35.4           29.4                5.9          108.3      43.0       98.0       38.9      10.3       4.1
                   Debt Service                         78.0              47.2              30.8               136.1          821.4                            240.2      95.4       145.3      57.7      94.9      37.7
                   All Other Operations                 46.2              20.4              25.8               80.6           35.6                             142.0      56.4       .62.7      24.9      79.3      31.5

                      TOTAL                           $562.4           $320.1            $242.3           $    977.8       $554.8             $422.8       $1,856.8   $737.4 $1,105.0         $438.9  $745.2,     $295.9

                   aincludes $24.7 million State revenue refunds.
                   bAlso includes FICA.and Health Insurance.
<pb n="58" />

                                                                            TABLE III

                                            SUMMARY OF PROJECTED 1985 REVENUES AND EXPENDITURES

                                                                                                                   Millions of Dollars
                                                                                                           1973 Dollars          1985 Dollirsa

                       State Government

                             General Fund Revenues                                                             $381.6              $ 731.6
                             General Fund Expenditures                                                           438.9                1,105.2
                                   Def icit                                                                    $ 57.3              $ 373.6

                       Local Governments

                             Revenues                                                                          $118.5              $ 216.5
                             Expenditures                                                                       132.1                  430.2

                                   Deficit                                                                    $ 13.6                   213.7

                       Total State and All Other Governmentsb

                             Revenues                                                                          $666.0              $1,262.9
                             Expenditures                                                                       737.4                 1,856.8

                                   Def icit                                                                   $ 71.4               $ 593.9

                       aAn assumed annual average inflation rate of 8% for the period 1973-1985 was, used to convert 1973 dollars into
                        1985 dollars for expenditures. It was assumed that the per-capita government revenues would grow by 5.15%
                        annually 1973-1985.
                       bIncludes; Federal Revenues to State and Local Governments. Federa      I revenues and expenditures were assumed
                        to be equal.
<pb n="59" />

                                          APPENDIX B    SECTION 4

                          Part V of the Report  Entitled "Committee to Investigate
                                           Delaware  State Finances"
<pb n="60" />

                                                PART V

                                PROSPECTS FOR STATE NEEDS AND RESOURCES

                   This section summarizes the results of the projective survey of

              Delaware public expenditures and revenues. The projections were used in

              the appraisal, planning and development of the Committee's recommended

              tax program.

                               Major Determinants of State Expenditures.

                  There are basically. four forces continually at work influencing the

              trend in Delaware State expenditures: growth in the State's population and

              its composition and location; rising costs of the goods and services

              purchased by the State; im rovement in the-quality and scope of public

              services; and efficiency in the operations.of State government.,

                  Based upon the experience of the past, probably the most obvious factor

              shaping.the magnitude of public expenditures in Delaware is the underlying

              workload or need for public services    school and university enrollments,

              the proportion of persons living in urban areas, the number of indigent

              families, and the like. For example, it is  possible to arrive at a first

              and minimum approximation of the fiscal requirement for higher education in

              Delaware over the next decade by applying.enrollment projections to the

              current level of cost per student. The same technique can he applied to

              each of the major categories of public services; that is, quantify the

              principal indicator of the underlying needs of a specific function, project

              its future level, and Apply the current, per-unit cost data. Elsewhere in

              this section, the procedure and resulting projection is referred to as  the

              t1constant cost" model.
<pb n="61" />

                      in addition to the forces of demographic trends influencing the rate,

                of growth of Delaware expenditures, there        is another variable of perhaps equal

                importance, namely the prices of the goods        and services'purchased by the

                State. Government purchases of manpower (i.e., personal.services) are

                particularly sensitive to pr    ice increases. They also constitute the bulk

                of governmental   budgets. In order to attract       the necessary resources into

                teaching, for   example, teachers' salaries.will.at least        have to keep pace

                withwage and    salary and pension and     fringe benefit   increases in the Delaware

                economy at large.     Similarly,   thecost of providing     public hospital and

                welfare care will have.to mirrow the corresponding private cost structure.

                Over  the last decade,   the prices of goods     and services  purchased by State

                and local governments,generally      have increased by 40.8
                                                                              -percent,   considerably

                above the rate.  of increase in overall.    consumer prices.

                      Be cause wage and salary levels in private industry        will likely continue

                to increase over the next decade, the State        of Delaware   will be confronted

                with steadily rising personnel costs.. Governments, like           most private service

                occupations (e.g., legal, medical, andthelike), however, cannot readily

                offset rising salary costs with offsetting productivity improvements. The.

                fact of the matteris that automation and mechanization can have            only a

                relatively limited impact     on the personnel costs of government.        Consequently,
                if the State   of@Delaware   is to  attract and   retain personnel,   and  to acquire

                additional resources as well,      it will have   to at least  match  the  increases

                in the private sector. The projection of         expenditures.which   provides    for.

                the inflation factor is termed the      "competitive"    model.

                     A  third  factor accounting for     growth  in the  level of State expenditures

                is changes in the scope and quality      of public services. Again, experience

                suggests that   the State can be   expected.to,do.more things and do them better

                in the future   than in  the present and   recent'  past. To   illustrate the point,
<pb n="62" />

             the.quality of the public educational offering is constantly being improv--d

             through better-trained teachers and new programs. Similarly,   many other functiona-

             fields are adopting higher professional standards for personnel who practice

             welfare, health, planning, law enforcement,  and recreation. Moreover, there is

             ample evidence to support the position that with rising incomes, citizens expect

             and demand a higher standard of performance from the public sector. Also,

             levels of State expenditures are influenced by the quality and scope of

             services adop ted by other states. New school and welfare programs initiated

             elsewhere, for example, create expectations and  subsequent pressures for

             Competitive emulation in Delaware. Thus, while   future quality changes in the

             performance of public services are difficult to  quantify, there,is every

             indication they will be positive and.substantial. The expenditure projection

             which incorporates changes in the underlying workload, inflation, and some
             expansion of the quality and scope of public  services is referred'to below as the

             "improvement" model.

                  Finally, the productivity and/or management impro vements in the performance

             of public services will work to influence the rate of growth in expenditures.

            .The intensive application and more effective utilization of computertechnolog)

             to@State governmental operations will serve to provide the same or an improved

             level.of certain public services at lower costs.. Similarly, new, integrated

             budgetary procedures can provide executive and legislative officials with

             better information for planning.program.s and for making choices among the
             alternative ways fund's are to be devoted to achieve specified governmental

             objectives. Thev can aid  the decision-making processes, in finding new methods,

             through analysis and evaluation of public programs, of providing public services

             better and less expensive ly

                  To sum, expenditures by the State of Delaware are going  to continue to

             increase in the decade ahead: by an amount to accommodate demographic changes;

             by anamount to improve the services provided by State government; and, by an
<pb n="63" />

               amount necessary to match the increases in the costs of    the goods and services

               purchased by the State. The likely magnitudes of Delaware General Fund

               expenditures in.1973 and 1978 are presented in the next    section.

                                           Expenditure Projections

                    Table  1 summarizes four  series or "models" of projections of State General

               Fund expenditures in  the fiscal years 1973 and   19781. All four models  are based

               on the same   assumptions regarding overall prosperity in the  national economy,

               the state ofthe.international situation, and     the division of functions between

               Stateand local governments., They differ.only     as to the relative.importance

               attached  to the major determinants  of expenditure levels.

                    The  first series, designated  the "Constant.Cos,t" model, indicates the

               1973 and  1978 levels of State General  Fund expenditures required,to

               accommodate change in what has been   earlier referred to as the underlying

               workload. Thus, for example, the primary determinant     of public education,

               costs is pupil enrollment. The fiscal requirement     for State support of

               public elementary and secondary school education over thenext decade      is

               determined in this model  by applying projections of the number of school,,

               children to the current  level of cost per pupil. The same technique ha    s

               been applied to each of  the.major.functional categories of public services;

               that is, quantify the principal indicator of the.   underlying needs of  a

               specific function, pro]ect   its futurellevel, and  apply the current per unit

               ,expenditure data.

                    In the "Constant Cost" model, no   account is  taken of probable  price

               changes or of probable improvements in the standards and scope    of  existing

               public service programs.    In the context of an expanding nationaland State

               economy, however, experience   indicates.that constant per unit  costs canbe

               maintained only b y re ducing the quality  and/or  quantity of existing programs.
<pb n="64" />

                   Because of the unlikelihood of    this occuring, the "Constant Cost" projections

                   are considered highly unrealistic. It should be noted, nevertheless, thAt

                   even under these highly unrealistic assumptions, the level of State General

                   .Fund expenditures will increase over the decade by over 40 percent.

                                                      TABLE 1

                              70         El                                    19731 AND 1978.
                      PROJE T -@,,'S OF D -AWARE GENERAL FUND MXPENDITURES
                                          (In thousands of dollars)

                       Year and "It.,Iodel"                            General Fund Expenditures

                   1967/1968 Actual                                              158,875
                   1973/1974:              a
                        I.  Constant   Cost                                      198,665
                       I!.  Competitiveb                                         230,307
                      III.  Improvemente                                       i 266198@
                       IV.  Continuation                                          20
                                          d                                      2 Y050
                   1977/1978:
                                          ba
                        I.  Constant Cost                                        242,590
                       II.  Competitive                                          326,021
                      III.  Improvementc                                         438,145
                                       . d
                       IV.  Continuation                                         283,420

                   aExpenditure projections reflect    only  the, increase in underlying-workload:
                        (i)   Elementary and Secondary Education - school enrollments
                       (ii)   Higher Education - student    enrollment
                      (iii)   Health and Welfare - public.assistance     cases
                       (iv)   Highways - miles of roads and highways
                        (v)   Pension and Social Security      State employees
                       (vi)   Other - population

                   .b
                   Projections reflect underlying workload and price       increases  of 3 per cent
                   .per,year.
                   cCompetitive model and an allowance for     a 3 per  cent  annual improvement in
                   the scope and quality of public services.

                   d
                   The level of expenditures which'would result if       expenditures increased
                   at the same average annual rate between 1969and       1978 as they did between..
                   1964 and 1968 (increase equals $12.7 million annually).
<pb n="65" />

                        The  "Competitive" modelgives the probable magnitudes of outlays         on

                   General Fund programs of   current quality, but adjusted to reflect-both

                   'an 4,Mr-1 ving workload factors and the effects of inf lation on public .service

                   costs. The model-reflects a 3 percent average annual inflationary
                   factor. The "Competitive" model projections are, therefore, considered,

                   the minai@=xm" level of General Fund expenditures. which is at all, likely.

                   In all probability, price level changes will     fluctuate between 2 per cent

                   and 4 per cent over the.next decade. It is      anticipated that the inflation

                   experienced (over  4  per cent)  in the last year will,not   belallowed to,

                   persist over long  periods of  time.   On thelother hand,   if State   government

                   is to acquire  resources, particularly manpower., it will    have to  at least

                   match.the wage,and salary increases in the private sector., Moreover,,.it       may

                   even have to do somewhat   better than matching ifit is to attract additional

                   resources into government employment,

                        Increases in State government outlays     have increased.in the recent.

                   past by more than population (workload).and.price changes      alone can explain.

                   A majorcontributing factor has.been.improvement in the scope and quality

                   of public services. This expansion is related to      the growth of the economy.

                   in various ways.   In the first place, some    public services,are    necessary

                   complements to the  growth of the private sector (e.g., enrichment of

                   educational programs to satisfy    the scientific and  technical requirements

                   of modern industry)."Alsoi, with rising personal incomes, a higher standard

                   of performance is expected from the public sector. Just as the consumer

                   with rising.income 6hifts'his pattern of spendingto more and better quality

                   private goods, similarly voters  .with rising incomes demandmore and better

                   quality public services. To    acc    odate-this  factor., a third set of
<pb n="66" />

                 projections has been prepared. They    are designated in.Table 1 as the

                 "-Improvement" model. They allow for   expansion in the underlying workload.r,

                 7rice             an6 some improvement in the scope and quality   of public
                 services. Because the pace of program improvement is subiect to discretionarv
                 control, an ann ual, uniform 3.percent improvement factor has been employed.
                  -i-e this tr@ay not accurately reflect year-to-year imprcverinents it seems a

                 :@-easonable Tr-e-4,rnitude over the long ran. As indicated, the "Improvement"

                 model -,rojections build on the "Competitive" Taodel, which, in turn., has the

                 "Constant Cost" model as a benchmark.

                      Finally, the "Continuation" model indicates the level of General.

                 F@d  expenditures which would result if outlays increased between now and

                 1978 at the s.`1M annual average rate as they did over the last five years,

                 i964-1968.

                                            Revenue Projections

                      The best "fit", of aggregate General Fund.revenue projections to actual

                 total collections is obtained by the use of a ti:-ae series employing the

                 most recent five-year base peri od. In general, this was the method

                 employed in arriving at the projections of. General Fund

                 revenues summarized in Table 2. Three,exceptions to this rule should,

                 however, be mentioned. To minimize cyclical fluctuations in receipts from

                 the inherita  nee and estate tax and in mercantile license fees, a ten-year

                 base period was employed. Also, because of the recent-enactment of the
                 real estate transfer tax (1966),, a three-year base period, 19667.68,,was

                 used in projecting receipts from this source over the next decade.
<pb n="67" />

  100,

                              Table 2 shows that the natural or "automatic" increase in tax revonues

                       that   takes place as the economy of the State of Delaware grows,will account

                       .,or more than    a  75 per cent increase ($119 million) in General Pund receints

                       over. the next    decade. It should be mentioned again that these projections

                       assume no    spec.ific discretionary changes in the existingrevenue structure;

                       tna-@          new @,ax sources, no       increaSes in rates 3n        cxi@3-zir4@ !@,,v:;*,...:@&amp;)

                                 zi-jas  of tax bases,     and   the like.

                                                                 TABLE 2

                                      OF           IE G MCERkL   FUND REEV!2@IJES ,        PLND 1`178   AISSUMPM
                                                                                    1973
                                       CTU"7GE IN TAX RATES,       USAGE, OR OTHEt", PROV-1.:@II&amp;Nrl'
                                                       (In thousands of dollars)

                          F i s c al Year                                                  Revenue

                       19'6 7,119 68 Actual                                                156,707

                                                                                           217,337
                        p-I i                                                                76,567

                                                 Expenditure-Revenue       Imbalances

                            Table      bri---s  together the projections of expendi@'._I::C@-,

                                                                       nagn'tudes uf thic.     c @)r_-,:
                       for the General `@Luid       ndicating the      m    L

                     .or d                                 depending upon the "model"          selection,  . %ne
                           e'icits. As indicated,

                       estimated 3eneral Fw-id exj.@enditure-reve         Inue imbalance raraj,-es in lq-,@/P_

                       a surplus of $18-7 million to a deficit of $49.7 million;                  the

                       imbalances in 197(ho, rartce        from a surplus     of approximat,21Y           :flillion

                       Ft deficit   f   1 (7' ) 21 mill iOLj
<pb n="68" />

                                                       TABLE 3

                         PROJECTIONS OF GENERAL MID EXPENDITURE-REVENUE IMBATANCES,
                     1973 AND 1978, ASSUMING NO STRUCTURAL ADJUSTM!ENTS IN THE TAX SYSTEM
                                             (In thousands of dollars)

                                              - - ----------- -

                                                                              'JUX"Pl-as (Defici-L.')

                     c,

                             Constant Cost
                        ,L _L Competi.tive                                               "--(0)
                       !I!.  L-.-,proveinent
                                                                                        0,@ L
                        IV.  Continuation                                             (2,713)

                   19771/1978:
                        1. Constant Cost                                             33,977
                        II.  Competitive                                             (49,454)
                       III.  Improvement                                            (161,578)
                        IV.  Continuation                                             (6,853)

                        it is the jud@gment of the Committee that the "most likely" General

                   iund projection of expenditure-revenue imbalance is given by the

                   "Improvement" model, which takes into account a modest improvement 0
                   per cent) in the scope and quality of.General      Fund  services coupled with a
                   small (3 per cent) rise in the price level. Under these assumptions, the
                   revr--nue deficier .cy (gap) will be'approximately $50 million,in 1973'/74 and

                     09. million in 1977/78. In other words, over the next decade, structural

                   adjustments are required in the existing tax system to yield some 58 per

                   cent more revenue over the next decade if the General Fund is to achieve

                   .a-balanced budget position in the target year, 1977-78. Table.4 summarizes

                   the projected need for additional General
                                                                  Fund revenue.,*
<pb n="69" />

                   PROJECTED NEED FOR ADDITIONAL GENERAL FUND REVENUEY 1973-AND 1978,.
                                        (In thousands of doll 8)

                                                                           '97/76
                                                        19-13/74

                Program Expenditures*                   266,989            438,145

                     Less:

                Revenues Under Current Laws             217.,337           276,56

                     Equals:

                Additional Revenue Requirement           49,65z           .161,578

                              te
                *.".Most likely projection: Improvement Model, Table 1.

                     No allowance, however., has been made in the,projections of expenditure-

                revenue imbalances for an "appropriate" or "safe" level of General Fund

                current cash surplus. The General Fund currently faces the coming fiscal

                year with essentially a zero cash balance. On the assumption that a

                current cash balance Of 5-7 per cent of revenue is desirable and necessary

                to match income with outgo in any given fiscal year, an additional.$13 million
                of revenue will be required in 1973/ 74 and $22 millionln 1977/78.

                     In total, therefore, additional revenue of $1&amp;@.million.vill be needed
                in 1977/78 to finance General Fund programs, to re-establish a reasonable

                cash balance, and to provide an adequate cash flow. With these, objectives

                ,in mind and.considering certain other budget deficienciesin the current

                year, the Committee settled on a tax program, to raise approximately $30,

                million in the next.fiscal year and which-, with subsequent year revenues

                responding to econom. ic growth, will generate the required yields to accommodate

                a balanced General Fund budget: in 1977/78.
<pb n="70" />

                                           APPENDIX B   SECTION 5

                               Extracts From the Minutes of the July 30, 1975
                                Meeting oF the Delaware   Tomorrow Commission
<pb n="71" />

                            Extracts From the.Ninutes of the July 30, 1975
                              Meeting of the Delaware Tomorrow Commission

                  Mr. Bradford  said that he thinks this projection of $600 million

             deficit by 1935 is  as good as the assumption. If a 5%   deficit had shown, it
             would not have made  much impact, but (out of the calculations came the fact
             that the deficit represented 50% of the revenues estimate) with such a figure,

             it is a guideline that indicates that somethingwill have to be done either in

             curbing expenditure or by increasing the revenues. The order of figures is

             significant and of a serious magnitude-

                  Mr. Biondi commented that the magnitude of this deficit indicates that

             when the Commission discusses its report and the question of growth-rate comes.uD,

             the Commission should indicate two things: al,l sectors of the economy in the

             State are goinq to have to look forward to paying increased taxes per capita--

             substantially so in the next ten years--and it has reached a point where we

             cannot afford some of the luxury, inefficiencies and waste in State government.

             It mav indicate that  government streamlininq may have to be accomplished; and

             the way we render services will have to be  examined. Ten years from now, we

             will not be able to operate under the same  structure as we are o perating now.
             In terms of the Delaware family unit, this  also means that in the concept of

             the qualitv of life, the standards of living will deteriorate significantly--

             about 50%'. It was noted that the cost of-State government between 1969 and

             1973 increased tremendouslY, but thisWas due to all the new programs that

             were instituted, such as the oollution Protection, etc., while this 500.
             increase between 10,73 and 1935 is entirely without an'Y new programs. It was

             said that even the biggest industries are "tightening,their belts", such as

             duPont for instance, and there is  no reason why State government could not do.
<pb n="72" />

                .the same. It   was agreed that the area where     this  "tightening up" should be

                done is in the sector of public     and  higher education,   whichentails     the largest

                part of the State budget (51%).

                     Unless someone undertakes     the problem from this point forward.to recommend

                broad scale government reorganization      and governmental economy, the     Governor

                who will be elected in 1934 will look      like Mayor Beame.

                     Representative Seibel commented that there are too many layers of

                government for the 565,000 population. There are,also things that coul           d be

                done at  the regional level.

                     .1-1r. Biondi said lie does not look at  these fi,ndings in a negative way.

                Considering the   1935 population projection fiqure of 700,000 and the projected

                409,000  jobs., he thinks this is necessary a*nd desirable. Looking at these

                figures  as a base, and continuing to re-evaluate them-what these figures show
                is that we cannot go on in the next ten years       thinking that ev  erything wil  1

                work itself out without any dramatic effect on the.taxoayer. As the State

                growsl economies will have to be realized or the increases in taxes which will

                be necessary will kill off the mini.mun, degree of growth.

                     Mr. Wiener raised this question: is the high cost of government projected

                by 1935 a direct result of the population increase or is it because          the

                standards  of the quality of life that we have set are too high and,          therefore,

                we cannot  pay for them. If we want,these standards, we will have to pay

                for them.

                     Chairman Biondi asked what the Commission       members felt about    the

                problem.   Mr. Folsom said   that  the Commission   is not the-bodY   that will be

                able to do  anythinq about   this  problem.   It,is  basicallv a nolitical    nroblem.
<pb n="73" />

              The politicians will spend as mucK money to buy the services that the.people

              are crying for and will collect as.much tax as possible. The Commission will

              do well to point out the trend and the maqnitude of the problem, it will be
              to no avail to cut back on education: on overhead, that we should combine
              the State and county police because hese     are political decisions brought

              by the pressure of the voters.

                    Dr. Brucker commented that if   the solutions to  the probl,ems are in the

              hands of the politicians, and that    the politicians  react to the public's

              demands then it is up to the Commission to present the facts to the public.

                    Steve Chamberlin commented  that the magnitude of the cost increase is

              not a major factor  that has a direct relationship to the population increase.

                    It was further noted that the cost increase was    due to inflation, the

              types of services the people are receiving, the increase in the services by

              certain segments of education.

                    Dr. Brucker mentioned that it is not only an inflation    factor, but
              the fact that the.expen-ditures are going to inflate faster thanthe 'revenues.

              I.4e.are also discoverinq that the cost of service oriented operation Will qo

              up much quicker than the cost of manufacturing. This is a trend in the

              economy, the productivity increases are not there in the social services

              delivery.

                    Jay Cooperson commented that the quality   of life we have comes out of our

              per sonal dollars.  There are many, things that  the State government spends on

             ,to imorove the quality of life. There may be     some serious questions asked

              as to what areas we should spend our tax dollars on. How much are we willing

              to pay for pollution control, water quality, etc. If the State government

              i.s going-to provide for sewer plants, for instance, it will provide jobs,
<pb n="74" />

                it will provide for a distinct modifier. Maybe there should be some

                di.stinction as to where the government should spend its money.
                     Th e Commission arrived at.this general consensus:
                     .1. The State faces a problem: it will    take  a substantial  amount of

                dolla rs more to run State government and provide    services to the   people, by

                1985.

                     2. The rate.of cost increase    (50'Z by 1985) cannot be  attributed to  the

                increase in  population.

                     .3. The rate of cost increase is due mostly because the revenue grows at      a
                different-rate than  that of expenditure because of the nature of certain

                revenues.

                     4. The expenditure increase   is function.of inflation. State government

                is in the service rendering business and increase in.productivity, in the

                service area, means a decrease in the oual,itv of the services     orovided.

                     5. In order to combat these problems, State     government will have.to   give

                a serious look at more efficient ways of delivery system.

                     This information has to be disseminated to the public.

                     If the types of-revenues are.not going to.be adequate to handle our

                expenditures, then the Commi.ssion should   make the politicians aware of the    fact

                that some alternate ways should be found    to bring in revenues. Maybe the total

                funding base would have to   be reconsidered--not onlv   at the State level,   but at

                the county and local level.
<pb n="75" />

                                               APPENDIX C
<pb n="76" />

                                      ECONOMIC DEVELOPMENT COMMITTEE

                                                   Summary.

                 Since 1970, several developments   have combined to change the "economic

            climate" in Delaware. The need to analyze and understand this change has been

            a major concern of the Commission -- a policy which would recreate a desirable

            Ileconomic climate".

            I.  What are the major post-1970 developments which changed    the "economic climatell

                in Delaware?

                A.   The high rate of population and employment growth in Delaware between

                     1950 and 1970 has declined sharply since 1970.

                     1. Between 1950-1,970, Delaware was one of the  fastest  growing areas

                         in the U. S. east of the Mississippi.

                         a. Delaware was growing at twice the national rate of growth.

                         b.. The growth resulted in a heavy in-migration into Delaware and

                             the population growth was matched by growth in job opportunities.

                         c.. This rate of growthin Delaware was remarkable    in view of the

                             declining population and jobs in two significant areas of the

                             State -- Wilmington and Sussex County.

                     2. Since 1970, the rate  of growth in the State has dropped to the national

                         growth rate, and the national rate of growth has been lower since 1970

                         than in the 1950-.1970 period.

                         a. Delaware is still growing, but the drop in   the rate  of growth

                             has been dramatic.

                         b. T.he national growth rate  has declined largely because.of the

                             drop in the U. S. birth  rate.
<pb n="77" />

                            c. The Delaware growth rate ha,s declined both because of the

                                decline  in the birth  rate and a very sharp decline in the     rate

                                of in-migration.

                       3.   Between 1950 and 1970,   unemployment in Delaware was below      the,

                            national average --  g enerally below 4/00. During 1975, the    un.employ-

                            ment rate in Delaware has   gone up sharply to over 10%, rising above

                            the national average   which is in excess of 9% and which.is at,the

                            highest rate in over   30 years!

                                  (See Part I of   Report for detailed discussion)

                  B.   The  fiscal burden of State services has.increased     substantially in,

                       recent years.

                       1.   Public borrowing to finance government    services has   expanded rapidly.

                            a. The State's indebtedness    grew from  zero i n 1945 to  over $500

                                million in   1975.

                                City and county debt   also increased  substantially during this

                                period.

                            c.  The cost of State borrowing (debt service for interest and

                                amortization) has caused   a significant   increase in   current

                                revenue requirements.

                       2.   Deferred expenses must now be   met out of current revenue.

                            a.  The cost of pensions   for State employees has risen from 3%     of

                                payroll in 1950 to 13%' of  total general fund payroll in Fiscal
                                Year 1976 (partly  to cover  unfunded past service liabilities in
                                excess of 14200,000,000 over  a forty-year period beginning     with

                                Fiscal Year 1976).

                            b.  Similar pension cost increases are    in prospect at the   county and

                                municipal levels of   government.
<pb n="78" />

                      3.  The rapid growth of the State's population, the ex1pansion in the

                          government services, and the sharp increase in the cost of con-

                          struction have all r  esulted in expanded capital outlavs to provide

                          for schools, highways, hospitals, courts, prisons and other

                          facilities.

                     4.   Since 196.9, individual income and capital gains tax rates have

                          been increased substantiallv.

                          a. Delaware   has lost a competitive advantage over other states

                              it is no longer a high income/low tax State.

                          b.  Its total State and local tax revenues, on a per      ca.Pita income

                              basis, are about average for all states,-wher@as      ten,years ago

                              we were the leader.

                                 (See Report of Cost of Government Committee
                                          and Part II of this Report)

                 C. Other states have become.more attractive to new industry.

                     1.   Plany states have created effective development departments to seek

                          out new business and to.assist them in their decision, making..

                          a. Government zoning and related development procedures have been

                              streamlined.

                          b.  State educational. agencies have   been effectively utilized to

                              retrain local manpower for new business ventures moving into

                              the states.

                          c.  Tax incentives and development bond inducements have been

                              expanded.

                          d.  Both public and private leaders have united to promote the

                              development of their states.

                     2.   Delaware can no longer expect to grow rapidl@y simply because of its
                          location, its low tax base, and its large open spaces.
<pb n="79" />

                     3. The total cost of new industrial construction in Delaware has

                         become expensive.

                     4.  Housing costs for in-migrants have risen sharply and the older

                         housina stock in 'Wilmington has deteriorated badly.

                                         (See Part III of Report)

                 D. The economic vitality of Delaware has declined markedly.

                     1. Delaware has fallen behind in its  highway program s.

                         a. New highways have not kept pace with expanding population and

                             transportation demands.

                         b. Existing highways have not been fully maintained.

                         c. Traffic congestion has become acute in several areas of the

                             state.

                            Oote: The recent passage of a $42 million bond bill
                                    shows a recognition of this problem)

                     2. The railroad network is deteriorating.

                         a.  Freight service in the main north/south corridor has declined

                             and the road bed is deteriorating.

                         b.  The rail svstem south of the Canal has become critically

                             undermaintained.

                     3.  The City of 14ilmington has continued to suffer from problems

                         similar to those of other urban centers in the United States.

                                    A
                         a.  Blighteu housing and the crime rate are serious problems.
                         b.  The quality of public education needs to be substantially

                             improved.

                         c.  There has been a general exodus of residents and business from

                             the 'City to the suburbs.
                     4. Several areas of the State have been faced with shortages in water
                         and sewer facilities and air pollution problems have become a major
<pb n="80" />

                          issue north of Wilmington.

                                            (See Part IV of Report)

                  E. Leaders in govern ent, business, labor and other groups have publicly

                      disagreed on State tax and some environmental and developmental

                      policies.

                      1. Business leaders no longer promote Delaware as    "good for business".
                          a. New business candidates are not encouraged    by many Delaware

                              business leaders.

                          b.  The Wilmington wage tax has deterred new business from locating

                              in the City.
                          c.  Alternate sources of revenue must be judged for their equity and
                              effectiveness', includ*ing the relative burden of taxation on

                              manufacturing and business in the State.

                          d.  The State capital gains tax rate has become counter-productive.

                      2.  Delaware has.developed an anti-business image as compared to its past

                          reputation as the result of such things as the 1971 Coastal Zone Act,

                          the proposed excise tax on gasoline production, and the utility rate

                          excise tax.

                      3.  Delaware has yet to  develop a full ran ge of programs which offer its

                          citizens hope that these critical situations will be reversed in the

                          foreseeable future.

                                            (See Part V of Report)

             II. What are the present economic strengths   upon which Delaware can build?

                 A.   Its. geographic location.

                      1. Delaware is strategically-located in   the  nort heast metropolitan

                          corridor with favorable waterways for transportation and still has

                          a substantial amount of land and waterways which coul  d be used for
<pb n="81" />

                      future growth.
                   2. Delaware has ahigh level of land devoted to agriculture; and, with

                      the nation's food needs increasing, the favorable location of

                      Delaware's agricultural industry should permit it to continue

                      to make a major contri,bution to the State's economy.

                   3. The recreation and tourism industries are important and could well

                      be a growing activity. In addition, Delaware's historic and cultural

                      attractions should be recognized as another major economic asset.

              .B. The major industries in Delaware remain in the growth sectors of the

                   economy.

                   1. The chemical, automotive, and distribution industries have been

                      growing above the national average over the past 20 years and will

                      probably continue to expand at a reasonable rate.

                   2. These industries pay better than average wages.

                   3. With the exception of the auto industry, these industries have not

                      been subject to significant swings in cyclical employment.

               C.  Our analXsis of job growth over the next ten years leads us to assume

                   a growth rate Uual to one-half experienced in the 1950-1970 period.

                   This would provide as many new jobs over the next ten years as our

                   forecast increase in work force.

                      The new jobs developed by present industry may not match.the skills

                   of the resident work force, therefore, it would appear tha t Delaware

                   would need to be selective in attracting new industry to provide

                   balanced employment opportunities for all its citizens, especially

                   the unemployed and underemployed.

               D.  In the last tenyears, Delaware has substantially improved its education

                   system to provide better technical training at the secondary levels and
<pb n="82" />

                    It has greatlZ expanded its community and technical college network.

                    1.  Greater efforts need-to be made to relate this educational system

                        to economic opportunities within the State; and

                    2.  To make use of this system to train and retrain resident citizens for

                        opportunities which may open up with new business enterprise.
                E.  Except.for the indicated problems in rail service, highway bottlenecks
                    and localized shorta2es of water and sewer facilities, Delaware has a
                    2reat deal to offer new businesses in the form of available land,

                    waterways, utilities and manpower.

            III.  Conclusion

                A. .14hile the problems in Delaware are serious and challenging, it is the
                    consensus of the Economi c Development Committee that Delaware can have

                    a healt@yeconomic and social future providing: (1) that the State can

                    obtain general agreement on goals for population and employment growth;
                    and (2) that it is willing to make the changes required to correct some
                    of the problems outli'ned above.

               B.   In order to establish reasonable plans for future population type of

                    growth rate in Delaware, further information should be developed as to

                    the impact of growth. We need more informat ion on the followin2

                    questions:

                    1. How much of the present debt and the related debt service was

                        incurred to finance the post-war growth in the State?

                    2. Are there latent costs  of that growth which have not-yet appeared

                        in the current expense budget of the State, such as, some of the
                        cost needed to bring Delaware's highway system up to date or to

                        expand hospitals and prisons?
<pb n="83" />

                     3. Will future population growth in the State cost relatively more

                          in relation to per capita income than the cost of our recent

                          growth? Could the cost of this growth be minimized by effective

                          planning?

                     4.   1.4hat would be the relative benefits and liabilities of bringing

                          into Delaware (and into different locations within Delaware)

                          different types of businesses with their varying service require-

                          ments, job requirements, income Contributions, environmental impact

                          and related considerations?

                 C. The   Delaware Tomorrow Commission should establish population and employ

                     ment growth goals considerina such thin2s as internal population growth

                     vs. in-migration, type and amount of new businesses desired, and a_fore-

                     cast of the resulting changes in State income and expenses.

                     This StUdy has identified several unfavorable economic and social trends

                     in Delaware today which call for action. In addition, the Economic

                     Development Committee believes some continued employment growth within

                     the State is not only necessary but desirable.

                          To accomplish these objectives we recomend   the following programs

                     which are presented in more detail in the following sections of this

                     report.

                     1. It is recommended that the Governor develop an effective State

                          system to:

                          a. Coordinate all aspects of the economic development programs

                             set forth in this report.

                          b. Reinforce development efforts, consistent with these proposals,

                             of organizations in the private sector such.as commercial-

                             industrial brokers and developers, chambers of commerce, and
<pb n="84" />

                             util ities.

                         c.  Report annually the results attained.

                    2.   The Governor and Legislature should require an in-depth evaluation

                         of Delaware's career and. vocational education programs and State-

                         supported higher educat.ion, to determine how student interests and

                         job opportunities can be better matched.

                    3.   To assist in attracting desirable companies to Delaware we should:

                         a. Provide more complete and better organized information on such

                             things as site availability, manpower, wage rates, etc.

                         b. Expand  the utilization of State general obligation industrial

                             development bonds and the development of industrial parks.

                         c. Delaware's banks should be encouraged to give greater lending

                             support to business and industry.

                    4.   The Delmarva Advisory Council is an effective peninsula-wide

                         regional economic development body formed by  the States of Delaware,

                         Maryland and Virginia, which should be given the necessary financial

                         support, particularly for developmentof the   southern counties.

                    5. The State should study a revenue-sharing formula for commercial-

                         industrial property taxes, so that all jurisdictions of our small

                         State will share the taxes generated.

                    6. State and/or local programs for improved   water and sewer systems and

                         better housing must be accelerated, as these needs are unmet for the

                         present.population and also are vital to further economic development.

                       .The State government, in cooperation with Delaware's utility companies,

                         must develop a plan.for meeting long-term and short-term energy needs
                         of business and industry, including the development of.new energy

                         sources and the conservation of present energy.
<pb n="85" />

                     7. We should encourage concentration of employment and housing at

                          sufficiently high densities that mass transit will be practical

                          and profitable in the future. The I.-95/Route 40 corridor in New

                          Castle Countv is one of Delaware's best future industrial areas,

                          and planning for the area should recognize this potential through.

                          proper land use allocation, access, and services for industry.

                     3.   The State must immediately adopt a plan for continuation of and

                          improvement of inter-state rail service.

                     9.   Six actions are recommended to improve the.economic and social

                          environment within the City of Wilmington, which is a major area

                          of concern within the State. (See Part IV)

                    10.   Delaware must improve the State's business climate by making such

                          changes as:

                          a. By developing a comprehensive State-wide land use plan to remove

                             the inequities of the Coast al Zone Act. The Coastal Zone Act

                             was passed in lieu of a more complex Coastal Zone Act which was

                             proposed earlier but received little support. In reality, both

                             goals are an attempt to begin land use planning. The Committee

                             has concluded that the time has come to replace the initial

                             Coastal Zone.Act with a Comprehensive State-wide Land Use Plan-

                             ning Act. The present regulationssh ould be used intact as interim

                             guidelines to govern and develop the coastal zone until the new

                             land use management regulations are complete and accurate. At

                             that time, the Comprehensive State-wide Land Use Management Plan
                             would supersedethe Coastal.Zone Act and other,land use control
                             legislation presently administered by the State.
<pb n="86" />

                        b. Bringing the personal income tax rates, including capital

                            gains, in line with those of the more progressive states.

                        c. Establishing sound fiscal policies by a combination of strearl-

                            lining governmental functions and establishing an equitable and

                            adequate tax structure to provide the funds required.

                   11. The State should establish  a program to participate in the Atlantic

                        offshore drilling for oil and should study the development of deep-

                        water terminals in such a way as to maximize the future economic

                        benefits while minimizing any detrimental impact.
<pb n="87" />

                                                     PART I

                       Change in Delaware"s Rate of Population   and Employment  Growth

                   @etween 1950 and  1970, Delaware experi enced one of the fastest population

              growths of any state cast of the II'lississippi. This growth resulted from many

              favorable factors - geographic location, the industrial base in chemicals, and

              assembly and distribution services, the low tax rates, stable government,

              absence of urban blight, etc. The rate of growth has changed dramatically since

              1970 for many reasons which will be covered in this report. The purpose of this

              section is to estimate the  rate of gro@,; th in the next ten years, if no significant

              changes are made in the "economic climate" of Delaware.

              1. The rate of population growth in Delaware is-expected     to slow during  the

                  next ten years, but by 1935 population may reach 700,000. This would      be an

                  increase of 101,000 over 1975 -- an increase of 17 percent in ten years. The

                  increase would consist of 49,000 natural growth (births over deaths) and

                  52,000 net in-migration. This projection is based on 1970 census data and

                  the total may be on the high side in view of the sharp drop in birth rate

                  since 1970.

                        This is lower than the population growth rate of 23 percent in the ten

                     years,1960-1970,,but is about the same increase in number of people

                     (101,000 for 1975-1985 vs. 102,000 for 1960-1970).

                        The ratio of in-migration to natural growth is lowering.

                        The birth rate itself has been dropping dramatically.both in Delaware

                         the rest of the United States.

                        The size of the family is dropping with the drop in the birth rate.

                     Smaller family size means a need for more   dwelling units for 100,000 of

                     Population and more women entering t  he labor market.
<pb n="88" />

                      The rate of actual growth (1970 through 1974) corresponds with our

                   estimate for 1975-1985.

                The growth in Delaware's labor force will be more rapid between 1975 and

                1935 than the growth in population for two reasons:

               .a.  The number of young people born during the post-war population boom now

                   .are entering the labor force faster than the present growth in population

                    and faster than the labor force dropouts from retirement, death, etc.

                    The labor force will tend to be somewhat younger in the next ten years.

                    Those who will be entering thelabor force in the next ten years have

                    already been born (i.e., the growth in the labor force up to 1985 is not

                    affected by the recent drop in the birth rate).

                b. A higher percentage of females will be seeking empl-oyment as the result

                   of the shifting size of the family (see above)., The labor force is

                   estimated to increase by 54,000 in the 12 years between 197.3 and.1985

                   from 260,000 in 1973 to 314,000 in 1935. Almost half of the increase, or

                   25,000, will come from resident population growth and more women in the

                   labor market; the other 29,000 increase must come from a net in-migration

                   of job seekers.

            3. The rate of growth  in employment opportunities is projected to-keep pace

                with growth in the resident labor force.

                      This projection is based on actual growth in employment between  1953

                   and 1973.

                      But it assumes that there would be no greater rate of influx of new

                   business and industry to Delawarein the next ten years than occurred.in

                   the last 20 years.

                      It assumes that the rate of,growth in net new jobs will be only half

                   the rate of increase of the last twenty years: 15') in the 1975   1985
<pb n="89" />

                       period vs. 305% in  the 1952     1973 period.

                          It excludes consideration of offshore drillina for oil and gas, and/or

                       building of a deepwater port, each with onshore supp       ort activities.

                          It assumes a slowdown in the growth rate,of retail trade and government.
                       employment (including education jobs).

                          It may underestimate the net growth rate in jobs since there is little

                       likelihood of significant    further declines in    agriculture, wood products,

                       leather, and apparel, such as occurred in the last 20 years,         and.our other

                       rlajor employers now in the State have been in growth sectors of the U. S.

                       econ0mv.

                          It does assume the State Division of Economic Development will match

                       neighboring states.in its efforts and effecti      veness, in attracting new

                       businesses and industries to Delaware.

                          If the number of jobs grows only half as fast in the next ten years
                       by 15 percent vs. 30 percent in the 1952 - 1973 period            the number of

                       jobs in 1935 (excluding military) would seen, to corresDond to the projected

                       increase in the labor force (320,000 in 1985):

                          254,000     -   1973 jobs

                          309,000     -   .1935 jobs

                          Unemployment   would be estimated at the     1970//3 level (about 4%' or

                       12,000) under these projections. These figures are not intended to be

                       exact; thev are   a rouah order of magnitude. However, if the unemployment

                       @rate stays at or  above  the national level,.the estimated in-migrat,ion rate

                       would be lower.

                          UnemPlovment   in Delaware normally has been     under  10,,000 workers,

                       but currently has soared to 25.   9000  (10.2'0' of the labor force).   The
<pb n="90" />

                    auto assembly,  operating and construction areas have been hardest hit.

                    The auto plants' shutdown has impacts on the other industries-forcing

                    them to employ workers on a reduced basis where the loss in income is

                    not covered by supplemental pay. The State's economy may be too dependent

                    on the auto industry. Although Dela0are's chemical industry is more

                    stable, due to its administrative emphasis rather than production, it,

                    too, is a-dominant employer on which the State should not remain depen-

                    dent.

                       There are also some reasons to believe that underemployment is a

                    sizeable problem. In relation to education and age levels, many Delawareans

                    do not seem to be receiving the incomes as well-balanced economy should

                    r)rovide. It appears, particularly in K  ent and Sussex counties, that

                    people are working in jobs for which the pay is less than their training

                    and experience qualify them. Therefore, the.State needs more diversity

                    in the types of industry and jobs    to overcome underemployment and un-.

                    employment.

                 Although these problems are somewhat a result of the current business

            recession, some Delaware businesses can be expected to close down permanently

            in years ahead as have others in   the past.2,0 years. Therefore, existing

            industries need to be encouraged   in their expansion and new companies must be

            continuously brought into our State to provide employment for the expected

            natural grovith of our labor force., and these new enterprises need to be

            carefully selected to  balance  employment opportunities inthe State.

                 A minority within  the Committee felt the preceding employment projections

            based on present industry and other types of State employment were too

            Optimistic. Their lower job growth rate.judgement was based on the declining

            national birth rate, lets labor mobility, and.pessinism over the national
<pb n="91" />

              energy situation in the next ten years. However, if net new jobs should not

              develop as rapidly as forecast,.only the in-migration would be lower.

                   The whole Committee felt that, as a minimum and subject to the assumptions

              stated above, the growth in net new jobs would approximate the net growth in the

              labor force from the resident population.-
                   The Committee recognIzes the difficulty of forecasting precise growth data,

              since some of the factors that contributed to rapid economic growth in past

              decades may be less operative in the next ten years and some deterrents have

              aDDeared: rail service is,threatened; highway and mass transitneeds are unmet;
              na't'ural gas is in critical shortage; water is a problem in sections of northern

              New Castle County, in Kent County north of Dover, and in areas of Sussex County;

             .sewer systems are inadequate in parts of.northern New Castle County; air quality

              limitations exist north from Wilmington; our State appears to have developed

              anti-industry images; the State's economic development program may not be keeping

              pace with those of surrounding states;   and the worst slump in the Nation's post-

              World War II economy is upon us. On the other hand, Delaware's location, land

              resources, availability of labor and training. facilities, corporate tax rates,

              and availability of financi:ng for commercial-industrial expansion cont   inue to be

              favorable.

                   To suggest employment projections lower than the majority's ten year

              forecast given above would indicate a Delaware growth'rate slower than the

              projected national_ average, whereas Delaware has exceeded the national average

              for decades. The  Committee  majority... though uneasy about it ... therefore adopts

              the above projections.
<pb n="92" />

                                                     PART II

                                         Changes in Delaware's Status'
                                       As a High Income - Low Tax State

                  nelaware's reputation for high per capita income is     misleading. Since

             1950 Delaware generally has ranked in the top five or six states in per capita

             income, often lst, 2nd, or 3rd in the 1950's and early 60's. In the late 60's

             the State's ranking slumped (to a low of llth in 1970) but has recovered to

             fourth in the Nation.  in calendar year 1973. Delaware's ranking was misinterpreted

             for these reasons:

             I., Personal income.in Delaware has not been    distributed.as evenly   as the Nation's,

                 being concentrated disproportionately in    its relative few high   income People;

                 for example, in the 1950's Delaware was reported to have had more annual

                 millionaires than any-state excep   t New York. If we   look at a better measure
                 of average income, median family    income, which means half of the Stat  e's

                 families have income above this figure and half below it, we find that 12

                 states ... not just two or three ... were ahead of Delaware in the 1960 census

                 and 13 in the 1970 census. Using this measure, Delaware is not in the top

                 20 percent of all states.

             2.  The c ombined State and local government taxes in Delaware now are as high

                 per capita as most other states. This.was not.true in the 1950's.

             3.  The cost-of-livingin the Philadelphia region, by which we are influenced,

                 is about two Percent higher than the average for all-United States urban

                 areas.

             4.  If I)elaware's per capita income   is adjusted to reflect the higher   State and

                 local taxes and cost-of-living,    Delaware's per capita income falls from Ill

                 Percent of the Nation's average    to about 105 percent.,
<pb n="93" />

             5.  Delaware's high per capita income statistic mainly reflects New Castle

                 County's condition where two-thirds of the State's people are concentrated,

                 Particularly.highAncome people.. Kent and S ussex counties have been

                 considerably below New Castle County in income, although a bit above other.

                 rural counties on the Delmarva Peninsula. The 1970 census gives Kent's

                 median family income as $3,503 and Sussex's as.S8,258, compared to New

                 rastle's @10,939.
<pb n="94" />

                                                  PART III

                              Actions Needed to Make Delaware More Competitive
                                             With Other States.

                 Delaware@is largely at the  mercy of external forces -- regional, national,

            and international -- in terms of its level of growth and development. In every

            asnect of Delaware's government and educational system, we must create "quick-

            response" capability -- enabling the State to act and/or react with the greatest

            speed as events and trends unfold.

                 State and local governments in Delaware must streamline their exceedingly

            cumbersome and time-consuming regulatory and review processes (zoning, subdivision

            control, environmental control, etc.), parts  of which are unnecessary and dis-

            courage not only the worst'companies  but the best as well and place Delaware at

            a competit@ive disadvantage.

                 Industry considering locating in Delaware needs detailed information by

            regional area of industrial site availability, employr nent environment, manpower

            availabflity and skill, wage rates, training facilities, etc.    Therefore, a single

            State agency should  have a complete summary of this t pe of information, well
                                                                   Y

            organi:zed, up-to-date, and readily available for interested industries.

                 1)  It is recommended that one organization within the State be organized
                     and staffed adeouately to: a) Coordinate all aspects Of tTle ec-o-n-om-ic
                     develooment programs set forth in this report; b) reinforce developmen  t
                     efforts, consistent with these proposals of organizaTirons in the private
                     sector such as commercial-industrial brHers and developers, chambers of
                     commerce, and utilities; and- c) report annuaTTY-The results attained.

                 In order to maintain the required level of job opportunities and the general
            economic health of the State, a vastly improved  State economic development program'

           .is needed. The State should accept major responsibility for economic development

            efforts, working close-Ty with local leaders, agencies and  groups. In order to

            establish and improve an edge over competing states, Delaware must be more
<pb n="95" />

             aggressive in selectively recruiting target business and industries-and provide

             a liquick-response" when opportunities knock. The Governor's personal leadership

             and involvement is essential in implementing a strong State economic development

             program.

                  The State Division of Economic Development should be the vehicle for providing

             the neceSsary functions and given the capability to devise a full-range of pro-

             grams needed to achieve the high level of economic developmpnt on which Delaware's

             citizenry and governments depend. These should include the "Target Industries

             Program" for selective recruitment of industries best suited to Delaware, financial

             aid for expanding tourism and recreation facilities, a program to attract foreign

             firms to locate manufacturing and distribution facilities in Delaware, and ability

             to expedite with local governments.the needed permit requirements..

                  2) Career education in Delaware's public schools seems to be making progress.

                      Howevpr, some students still are trained for a narrowspecific job and

                      others trained so generally that it's no training. In most cases when

                      the student is unable to obtain or loses a job, fie must be completely

                      retrained for another job.

                           In all occupational training programs more emphasis is needed on

                     ."job clusters" or-"job ladders" that teach basic skill or operational

                      concepts applicable to many jobs. Taking another job becomes only a new

                      application of these concepts rather than complete retraining. Emphasis

                      on "continuing education" programs throughout life  must be made possible.

                      Similarly, students and workers should be trained  for opportunities in

                      the multistate job market -- not in Delaware's job  market alone.

                           Delaware Technical and Community College and  our Vo-Tech Centers

                      must become more flex.ible   able torespond to   immediate.or short-term
<pb n="96" />

                      training needs as well as to long-term.     More jobs will require post

                      high school technical or service degrees. For the     next ten years we

                                                               th moderate skill requirements.
                      should attempt to attract employers wiU

                      while simultaneously changing our vocational training in the direction

                      of job clusters or ladders.

                 The Governor and Legislature should require     an in-depth evaluation of

            Delawarels career and vocational education programs and State-supported higher

            education,  to determine how student interests and    job opportunities can be better

            matched.

                 The  percentages of  Delaware high school vocational   education graduates

            availab le for work who  become emnloyed  full-time in jobs for which they were
            trained  (or related jobs) have been 86.3 (1969), 63.7 (1970), 76.6 (1971), 90.6

            (1972),  and 75.2 (.1973). 11hat difficulties do the other 10, 15 or often 25-30

            percent, have in obtaining, keeping and advancing in jobs unrelated to their

            ,training? Is. it by choice or necessity that they   seek other work? Can we do better

            in matching training to job openings?

                 Employment service files provide evidence of     softness in the Delaware
            markets for lower level m' anagerial and administrative personnel, school teachers,

            retail sales clerks, clerk-typists and other clerical workers, truck drivers,
            waitresses, hospital attendants and,other service workers. For.D      elaware high

            school graduatin classes, unemployment the year following graduation was only
                             9

            7.2 nercent for the class of 1969 but rose to 10.U percent for the class of 1973.

            Of the 1,812 students who completed the office vocational program in 1973, 3413

            or 18.1 percent,were unemployed at year's end and another     244 or 13.5 percent

            were employed in jobs unrelated to their training. In other words, one out of
            three students trained i-n the office Program did not get a related    job.
<pb n="97" />

                  The State Department of Labor and State Department of P  ublic Instruction

             must greatly improve their data on employment, unemployment, underemployment,

             wage rates, people seeking work, projected graduates in vocational/technical

             curricula, and other aspects of the Delaware labor force, especially at community

             or at least county -- level. These.data are needed by companies.interested in

             Delaware sites and for many other planning and development purposes.

                  Therefore, it is recommended that the Governor assign one   State agency the
                  7asic responsibility to coorainate and produce the needed   information.

                  3) As our best inducements to new industrv   are the State  general obligation

                      industrial development bonds, the authorization limiton them should be
                      raised as needed. Also, the Industrial   Bonds Act  describing eligible

                      projects and terms should be continually reviewed   and amended as

                      necessary to give maximum flexibility in assisting   new projects,

                      including provision for non-manufacturi.ng projects  not presently

                      eligible. Additional State financial aid for assembly of industrial

                      land, preparation of industrial parks and construction of speculative

                      industrial buildings may be required.

                  4)  Delaware's banks should be encouraged to give greater lending support

                      to businessland industry. Commercial-industrial loans represent a smaller

                      percentage of all bank loans in Delaware, and this should be increased

                      ,toward the United States average as another way of encouraging business

                      development and expansion  in the State.

                  5)  The D'elmarva Advisory Council is an effective.peninsula-wide regional

                      economic devel opment body fom.,ed by the States of Delaware, Maryland

                      and Virginia, which should be given increased.financial support,

                      particularly for development of the southern counties.
<pb n="98" />

                  6) The State should,study a revenue-sharing formula for,commercial-

                      industrial revenue so that all jurisdictions of our small State will

                      share in the revenue equitably.

                  7) State and/or local programs for improved water and sewer systems,

                      transportation and better housing must be accelerated, as these needs

                      are unmet for the Dresent population and also are vital to further econo-

                      mic development.  The State government, in cooperation with Delaware's

                      utility companies, must develop a plan for meeting long-term and
                      short-term energy needs of business and industry, including the develop-

                      ment of new energy sources and the conservationof present energy.

                 8)   We encourage concentration of employriient and housing at sufficiently.

                      high densities that mass transit will be practical and profitable in the

                      future. The I-95/Route 40 corridor inNew Castle County is one of

                      Delaware's best.future industrial areas,.and planning for the area

                      should recognize this potential through proper land use allocation,

                      access and ser Vices for industry.
<pb n="99" />

                                                    PART IV

                            Problems Affecting The "Quality of   Life" in Delaware

                   1.  An urgent and important matter is action   to save Delaware's threatened

             rail service. There is no time to lose. Rail.service is the lifeblood of the

             economy  downstate.  In a few weeks decisions will,  be made. Proposals are now

             nearing  final form at.the Federallevel.

                        -ate must immediately support a,plan    to insure not only continuation
                  The St

             but improvement of  Oelaware's rail freight.service, it   being an essential to

             further economic development. The plan should provide     for sound rail service

             preferably by acquisition and operation   of essential rail facilities by one or

             more existing  solvent railroad companies.

                  The Secretary of the Department of Highways and.Transportation be requested

             to forward this statement of policy made by the Delaware Tomorrow Commission to

             the relevant federal officials dealing with the.problem of the southern acquire-

             ment of the rai.lroad and the rate problem and that it   be also sent to our

             Congressional Delegation and to the Delmarva Advisory    Council.

                  Any plan considered must incorporate satisfactory    north-south as well   as

             east-west interstate service, the latter having   been adequate in the 'past and

             apparently provided for  the.future with publici-zed  solvent carrieracquisition

             plans. Delaware should   strive to  optimize traffic corridors between Delaware   and

             southern states by supporting.two   routinq systems; one via the Delmarva and    the,

             CaDe Charles, Virginia car ferry, and the other a complete land route between

             the Uilmington area and Washington, D. C. Service by the latter route will

             permit maximum flexibility in choice of carrier beyond Washington. Both north-

             south rail services would be, most logically and appropriately developed through

             acquisition by southeastern  based railroad(s),  the absorption  representing the
<pb n="100" />

             the type of end-to-end acquisitions meeting the "merger" criteria of the U. S.

             Secretary of Transportation and the Federal administration. Such acquisitions

             will insure high quality north-south rail service, which is questionable at this

             point in time based on what is currently known about the proposals under consider-

             ation.

                  The State plan should further concern itself with insuring maximum routing

             flexibility permitting Delaware industry the unrestricted opportunity to select

                         'l service available to all s ctions of
             the best ral                               e           the countrv. To this end the

             U.S.R.A. Final System Plan for reorganization of Northeast rail services must

             either require the Consolidated RailwayCorporation to open routes via all rail

             connections north, south, east and west or make provision for solvent southeastern

             rail carriers to gain access to Delaware industry through     trackage rights and/or

             acquisition'of the necessary rail facilities..

                  2. The City of Wilmington-presents special economic      and social problems

             and probably is  the major area of concern within the State. Unemployment is high
             because of the exodus of people and businesses to the suburbs and the concen-

             tration of unskilled low-income families.in the city. The result is inadequate
             tax revenue to maintain City services, whi   ch in turn leads to higher tax rates,

             which brings on further exodus. Since the City of Wilmington is central to the

             health of the State's ecanomv, it is ess   ential that so lutions to its problems

             be given top priority.

                  it i.s recommended  that the following  steps be taken to  improve  the economic

             and.social environment  within.the City of   Wilminaton:

                       a. Direct economic growth to Wilmington, where there are       unused

             .industrial buildings-and land,.water and sewer system,  s are adequate,  and a

             complete infrastructure built to se'rve 110,000 people now serves less than

            .75,000.
<pb n="101" />

                        b. Expand educational programs to upgrade residents' skills and

             moti vat ions..

                        c. Expand  the activities of and  employment at the Port of Wilmington

             by carrying out the recommendations of the   "Port of Wilmington Study Committee.

             including the necessary capital  investment.

                        d   Improve redevelopment in 14ilmington:  we urge study of ways the

             tax load might be spread beyond the city limits to   encompass all of northern

             Delaware., as the city is an integral part ofthe whole area and one cannot

             prosper without the other..

                        e.  Improve allcity services to make it an attractive and safe place

             to operate a business.

                        f.  Give special tax inducements  to businesses which will locate.in.

             areas of the city where adequate facilities.are already in existence so as to

             make use.of existing investments not now being ful,ly utilized.

                  3. Homebuildingin Delaware,has.fallen from 5,800 units in 1970; 7,900 in

             1971; 3,800 in 19721 and 9,,6.00 in 1973, to only 4,400 in 1974. The loss of housing

             construction as an economic force has  been critical.
<pb n="102" />

                                                 PART V

                                  Lack of Unity Between Political and
                                      Business Leaders in Delawa@re

                 There has been a critical change developing between the leaders of government

            and industry in Delaware. The disagreements involved have been su mmarized in a

            varietv of Public statements over the past two years and the Committee has further

            documented these problems in the form of letters from various business leaders in

            Delaware.

                 The core of this controversy revolves around,the upper limit of the State's

            personal income tax rate at 19.3%; the lack of a ceilinq on earned income; and the

            100% capital gains tax.

                 1. Individuals in the  upper income brackets are establishing thcir

            residence outside the State when possible or after retirement. Such change in

            residence can seriOUSlV erode the tax base.  High personal income tax rates are

            a serious detriment to the location of new business in Delaware.

                 2. Hany business. leaders are making either luke-warm or outriqht dis-

            couraging recommendations to other businessmen considering the selection of.

            Delaware for new business locations.

                 Another major concern has been the anti-business image of Delaware resulting

            from such actions as:

                 1. The controversy over the present Coastal Zone Act.
                     Recent efforts by.the State Legislature to adopt discriminatory

            excise taxes.

                 The Committee makes the following recommendations, to unify the business and

            government leadership in the State and to correct the anti-business image of

            Delaware:
<pb n="103" />

                   1. The Coastal Zone Act, as ini
                                                   tially passed, was intended as a ston-gaD

             measure to  prohibit certain types of industry.

                  This bill was passed  in lieu of a morc.compl*ex Coastal Zone Act which had

             been proposed earlier but  receiv e.d little support. In realitvi both bills were

             an attempt to begin land use planning.at the State.level. The Committee has

             concluded that thetiine has come to replace the initial Coastal,Zone Act with

             a comprehensive State-wide land use planning act. The present regulations should

             be used intact, as interim guidelines, to govern development in the coastal zone..

             until the new land use management plan  and regulation s are complete and enacted.

             At that time the comprehensive State-wide land use management plan would supercede

             the current Coastal Zone Act and other land use contro.1 I.egislation presently

             administered by the State.
                      The present income and capital gains  tax structure in Delaware puts the

             State at a serious disadvantage in completing  with other progressive states for

             new business. An objective study ofthese tax sources should be made promptly

             as they relate to the total revenue needs of the State and as they relate to

             their impact on potential new business ventures locating in the State.
                       a. Such a study should   up-date and evaluate the recommendations  o@

             t- he Hagemeyer and Carvel/Williams. Committee reports.

                       b. The study should involve the resources of the Finance Department-,

             the University of Delaware, and t1he business cor-imunity.

                           The study should assess the counter-productive effects  of  causing

             upper-income citizens.to change their legal residence and of imposing  much

             heavier tax burdens on capital gains and earned income than the federal   tax,

             structure.

                       d. Alternate  sources of revenue.must be j udged for their equity  and
             effectiveness including the relati-ve burden of taxation on manufacturing and

             @usiness in the State.
<pb n="104" />

                 3. The State should establish a program to participate in the Atlantic

             offshore drilling for oil and the development of deepwater terminals in such   a

             way as to maximize the future economic benefits while minimizing any detrimental

             impact.

                 DeePwater terminals and offshore drilling may develop along the East.

             .Coast. Delaware should be alert to and involved in such developments, both

             torean the benefits of the job and revenue opportunities and to maintain control

             to avoid undesirable environmental and other effects.

                 Delaware's location in the  eastern transpor tation corr idors, our coastal

             resources that could be vital to Federal enerqy policy,,* and our small area that

             limits growth-generation within our borders, make the State quite sensitive to

             external forces. If offshore drilling reaches peak production by 1985 and has   a
             full impact in Delaware (in addition to Ndw Jersey, Haryland' and Virginia)," the

             State's direct job opportunities in support of oil exploration and extraction,could

             increase by some undefined increment, possibly in the thousands.   These basic jobs

             might add three times as many more service jobs. At the other extreme, if pro-

             duction  is small and/or all or most of the impact accrues to other coastal states,

             as it may, the effect on Delaware from offshore drilling  could be minimal.

                @The Committee did not ha ve the data required to predict such  impact. Delaware

             awaits the findings of'study on this subject by the Congressional  office of

             Technology Assessment,.suonlemeht6d by consulting services that Delaware may

             employ. The State Planning Office should coordinate this effort.    The highest

             Drioritv for the State Planning Office under the Coastal Zone @Ianaqement Program,,

             should be research to Predict and eventuallY direct the landside impact of offshore

             drilling for oil and o-as.and/or of a deepwaterport. To offset the substantial

             fiscal deficits and employment/incone/ta-x revenue fluctuations likely.from such

             landside impact, the St,ate must.a.ttem,bt to build into other sectors of our

             economy all the strength, diversity and stability Possible.
<pb n="105" />

                                               APPENDIX  D
<pb n="106" />

                                                            AN ANALYSIS,
                                                                          OF
                                                                   CHANGES
                                                                    IN THE
                                                  DELAWARE      TAX CODE
                                                               1960 -1974

              by
              The Delaware  Econometric Model. Group
<pb n="107" />

                              AN  ANALYSIS OF CHANGES    IN THE

                              DELAWARE    TAXCODE,    1960-1974

                           The  Delaware  Econometric   Model  Group*

                                        September, 1974

           *Directors.:                             In'quiries should be directed to:

             Dr. John H. Landon                     Gerald F.  Hart, Manager
             Dr. William R. Latham    III           Delaware  Econometric Model
             Dr. Kenneth A. Lewis                   Purnell Hall
                                                    University of Delaware@
             Manager:                               Newark, Delaware    .19711

             Gerald  F. Hatt.

                                     This  report  was prepared by   the
                            Econometric  Model  C-roup'under contract
                            with the Delaware   State  Planning Office,,
                            and.was financed    in part through a   Com-
                            prehensive   planning  grant from the   Depart-
                            ment of HouSing and    Urban Development,
                            under the  provisions of Section 701 of
                            the Housina  A t of 1954, as amended.
<pb n="108" />

                                 ACKNOWLEDGMENTS

              This project has profited greatly from the work and coopera-
         tion of a number of people.. Most of the work of compiling this
         report was done under my direction by David Hutchinson through
         the summer months of 1974. Dave spent. countless hours in law
         libraries and interviewing individuals in and out of state govern-
         ment to obtain the most accurate possible picture of state taxes
         and their changes through the past fifteen years. From this data
         he prepared the adjustments tothe data required to provide a
         smoothed series for our use in model forecasting. His indepe'rid-
         ence, training, intelligence, hard work and ability to get along
         with people are responsible for the.success of this project.

              Through the months Dave labored on this project he had the
         excellent cooperation of a number of state officials. Hisham
         Khalil, in particular, gave freely of his time and vast expertise
         in dealing with statistics and state revenue matters. Bruce
         Hudson of the State Planning Office cooperated fully in providing
         valuable data and insights. Jack Malarky, Secretary of Finance
         for the State of Delaware used his influence to obtain data that
         would have been otherwise impossible to gather. State Representa-
         tive John Billingsley was kind enough to review a rough draft
         of the manuscript and provided many helpful suggestions.
              Among the non-government persons who provided valuable in-          J
         sights and information concerning state finances were Bruce
         Ralston of the Delaware State Chamber of Commerce and Bob Davis
         of the Diamond State Telephone Company. Gerald Hart, the manager
         of the Delaware Model, took on the responsibility for editing
         the final manuscript and re-doing the charts into more readable
         form. Lew Silver, the Delaware Model's computer analyst, gave
         generously of his@time and effort and was very instrumental in
         the -overall success of this manuscript.

              The responsibility for any remaining errors of ommission or
         commission is mine alone.

         Dr. John H. Landon
         Department of Economics
         University of Delaware
<pb n="109" />

                                       TABLE OF CONTENTS

                                                                                   Page

            ACKNOWLEDGMENTS     . . . . . . ... . ..    . . . . . . . . ... . .

            INTRODUCTION                                . . . ... . . . . .          v

            DESCRIPTION OF TAX SECTORS
                  Personal Income Tax . . . . . . . . . . .        . ... . . . .     1
                  Corporation Franchise    Tax . . . . . . . . . .
                  Corporation Income Tax                       . . . . . . . . .   17
                  .Motor Fuel Tax    . ... . . . . . . . . . . . . . . . . .       22
                  Business and'Occupational     License  Tax     . . . . . . . .   27
                  Tobacco Tax   . . . . . . . . . .... ..      . . . . . . . . .   32
                  Motor.Vehicle.Registration      Tax   . .. . . . .  . . . . . .  37
                  Inheritance and-Estate Tax
                                                                                   40
                  Alcoholic Beverage Tax      . . . . 42.,
                  Pari-Mutuel and Admissions Tax               . . . . . .       ..46
                  Realty TransferTax                                               50
                  Insurance Tax   ..... . . . . . . . . . . .      . . . . . . .   52
                  Public Utility Tax   . . . . . . .    . ... . . .. . . . . . .   54
                  Other Taxes   . . . . . . . . . . . . . . . . . . . . . .        56

            GRAPHS OF TAX SECTORS
                  Personal Income Tax    . . . ... . . . . . .. .     ... . . . .    4A
                  Corporation Franchise Tax                      . ... . . . . .   13A@
                  Corporation Income Tax      . . . . . . . . ..   . . . . . . .   18A
                  Motor Fuel Tax     . . . . . . . . . . . . . . . . . . . .       23A
                  Business and Occupational     License,Tax    . . . . . . . ..    28.A
                  Tobacco Tax   . . . . . . . . . . . . ... ... . .       . . . .  33A
                  Motor Vehicle Registration      Tax     ... . . ... . . . . .    37A
                  Inheritance and Estate Tax       . . . . .          . ... . . .  40A
                  Alcoholic BeverageTax       . . . ... .. . . .                   43A
                  Pari-Mutuel and Admissions      Tax   . . . ... . . . . . . .    47A
                  Realty Transfer Tax   .. . . . . . . . . .    .. . . . . . . .   50A
                  Insurance  Tax  . . . . . . . . . . . . . . . .                  52A
                  Public Utility Tax     . . . . . . . . . . . . . . . . . .       54A
                  other Taxes   . . . . . . . . . . . . . . . . . .       . . . . 56A
<pb n="110" />

                                 TABLE OF-CONTENTS (Cont.)

                                                                                 Page
          ADJUSTMENTS IN-TAX SECTOR DATA
                 Personal Income Tax     . . . . . . . . . . . . . . . . . .        5
                 Corporation Franchise Tax      . . . . . . . . . . . . . . .     14
                 Corporation Income Tax      . . . . . . ... . . . . . . . .      19
                 Motor Fuel Tax     . . . . . . . . . . . . . . . . . . . .       24
                 Business and Occupational      License Tax   . . . . . . . . .   29
                 Tobacco Tax   . . . . . . . . . . . . . . . . . . . . . .        34
                 Motor Vehicle Registration      Tax   . . . . . . . . . . . .    38
                 Alcoholic Beverage Tax      . . . ... . . . . ... . . . . .      44
                 Pari-Mutuel and Admissions      Tax   ... . . . . . . ... .      48
                 Realty Transfer Tax     . . . . . . . . . . . . . . . . . .      51
                 Insurance Tax   . . . .. . . . . . . . . . . . . . . . . .       53

           CODE  CHANGES IN TAX SECTOR
                 Personal Income Tax     . . . . . . . . . . . ... . . . . .         7
                 Corporation Franchise     Tax  . . . . . . . . . . . . . . .     15
                 Corporation Income Tax      . . . . . . . .... . . . . . . .     20
                 Motor Fuel Tax     . . . . . . ... . . . . . . . .       . . . . 25
                 Busines s and Occupational     License Tax   . . . . . . . . .   31
                 Tobacco Tax   . . ... . . . .    * *  * * *  ' ' *  * *  * * *  *35
                 Motor Vehicle Registration Tax        . . . ... . . . . .    1. .39
                 Inheritance and Estate Tax       . . .  . . . . . . . . . . .    41
                 Alcoholic Beverage Tax      . . . . . . ... . . . . . . . .      45
                 Pari-Mutuel and Admissions Tax        . . . . . . . . . . . .    49
                 Realty Transfer Tax     . . . . . . . . . . . . . .              51
                 Insurance Tax   . . . .   . . . . . . . . . . . . . . . . ..     53
                 Public Utility Tax    .. . . . . . . . . . . . . . . . . .       55

          OTHER FACTORS AFFECTING DATA
                 Personal Income Tax     . . . . . ... .        . . . . . . . .      9
                 Corporation Franchise Tax      . . . . . . . . . .    . . . . .  16
                 Corporation Income Tax      . . . ... . . . . . .                21
                 Motor Fuel Tax     . . . . . . . . . . . . . .     ... . . . . . 26
                 Business and Occupational License Tax        . . .. . . .  . . . 31
                 Tobacco Tax   . . . . . . . . . . . . . ... . . . . .            36,

                                                iv
<pb n="111" />

                                     @I. INTRODUCTION-

                 In order to  forecast, one must first    understand@the.past.

           Delaware  tax  laws and enforcement procedures    have changed

           substantially over the past fifteen years.       In order to  use past

           t,ax receipts in forecasting future state income, it is      necessary,

           to review  such changes,And make appropriate     adjustments in   the

           series  for their impact.    This study is  an attempt to draw

         ..together th.e.changes which   have occurred  between.1960 and 1974

           in the  Delaware tax  code,  in enforcement  procedures and major.,

           economic events in   the state which resulted.in    abnormal  fluctua-

           tions in  tax receipts.

                The  following  sections  each detail  the behavior of   a specific

           tax source  and include graphs of   the actual and adjus-ted    data.

           Lists are provided of the code changes and ofthe other        factors

           influencing the tax data. The     text explains   how adjustments were

           made and the conclusion sumn-arizes,the'major     changes in  the

           Delaware.tax picture over this period..

                We hope this.report.will,be useful to     those  forelcasting

           state tax revenues.. These results    are being   incorporated into

           the Delaware Econometric Model and    when this   has been accomplished,

           greater in-depth  economic analysis   can. be done on all,sectors

           of the Delaware economy. Any suggestions       for additions  to or

           modification of this study would be greatly appreciated.

                                            v
<pb n="112" />

                                 THE DELAWAR  E PERSONAL INCOME TAX

                  The Delaware   Personal.Income Tax    is'the largest   single

            source of state revenue. Delaware, does not employ a         general sales

            tax (the largest revenue source in many states), so         other taxes

            must generate a larger share.of      needed.revenue   than  is the case

            in most states. The ongoing       decision.to use,a relatively      high

            income tax rather than     a sales  tax in conjunction    with a  lower

            income tax is based on     public  policy toward the.  effect of1taxes

            on individuals.with different.incomes. In@general, sales taxes

            are  regressive, and even though recent efforts have        been made to'

            develop and institute a     sales tax excluding those items that

            contribute most to regressivity, this state has found it pre-

            ferable to retain and update      its progressively   graduated   income

            tax.

                  While rates   have always   been somewhat progressive,     chang  es

            during the, past   few years have made    them increasingly so, as

            shown  in Table  II.-l. The   effective  rates.average out to between

            three  and..four percent   of Federal Adjusted    Gross Income.

                  Oneof the   benefits   of a graduated    tax is that it adjusts

            itself to fluctuations     in overall economic    conditions.    The recent.

            Revenue Study Commission     (The Hagemeyer   Report) noted that     the

            class of taxpayers earning between      eight  and  twenty thousand

            dollars of taxab.le.income    per year  pay the   same tax rate   and
<pb n="113" />

           that because of this,   the income elasticity of.the tax is not

           as large  as it could be. The commission suggested      creating

           smaller classes in this range to build additional'el     asticity

           into the tax.

                The tax is based on an income figure which is derived by

           making some modifications to the federally     defined adjusted

           gro ss income (computed by each taxpayer in completing his federal

           tax return whichis    due 15 days before the due date for state

           returns). Use of the federal income as a base for state returns

           began in 1971, stimulating a simplification of proced     ures anda

           substantial increase in the collection of taxes owed. There

           have been suggestions recently for    a  tax that is.simply a

           percentage of the federal tax paid     (supporters of this type of

           tax note that several states have already implemented such tax

           structures yielding significant savings in paperwork and record

           keeping,).

                Employers withhold income taxes from their employees and

           deposit those withholdings w   ith the state.on a regular    basis.

           Persons not subject to withholding but earning income during the

           year are required to   estimate such earnings as soon as    practicable,

           and to pay quarterly   installments of their estimated taxes       The

           combination of withholding and estimation require    ments spreads

           the revenues out   over the year so that most,taxpayers are on a

           de facto ''pay as  you go" schedule. This also results in      smaller

                                             -2-
<pb n="114" />

           peak load problems in collection.
                it is statIe policy to tax all income.connected with  the
           state,-but at the same time to avoid the ine quities of double
           taxation whenever possible. Thus, residents   of the  state are..
           taxed on all of theirincome for the yea.r..but are credited*for
           taxes paid to other states, while non-residents pay taxes only
           on that portion of their income  derived from,sources within the
           state. The  tax is collected and administered.by the Division

           of Revenue, Department of Finance..

                                            -3-
<pb n="115" />

                                                       TABLE II-I

                                           PERSONAL INCOME TAX RATES

                                                                As Of            As Of             As Of
                  Taxable     Income            1959            7/l/61           8/1/71            l/l/74

                  $        0-  1,000            1.5%             1.5%              1.5%             1.6%
                    1@000-     2 @ 000,         2                2                 2                2.2
                    21000-     3@000            3                3                 3                3.3
                    35000-     4)000            4                4                 4                4.4
                    4X0-       51)000           5                .5                5                5.5
                    5X0-       6)000            6                6                 6                6'.6
                    6X0-       8)000            7                                  7                7.7
                    85000,-   20)000            8                8                 8                8.8
                  20X0-       25)000            8                @8                8.5              9.3-
                  25,000-     30,000            8                8                 9.               9.9
                  30)000-     40X0              8                9               11                12.1
                  40)000-'    50)000            8                9               12                13.2
                  5031000-    75,000            8               10                                 1-5.4
                  75,000-100,000                8               10               15                16.5
                    Over $100,000               8               11               18                19.8

                                                       TABLE 11-2

                                         PERSONAL INCOME TAX           RECEIPTS
                                                         ($1,000)

                                         Gross Income                                    Net Income
                  Fiscal Year            Tax Receipts               Refunds             Tax Receipts

                        1960.                                       $ 918                   $26@393
                        196@1                                        2,254                  27)450
                        1962                  36@194                 1,570                  341624
                        1963.                 34 947.                1)471                  33,476
                        1964                  38)864                 33510                  35)354
                        1965                  44)694                 2,511                  42,183
                                                                         801                45)133
                        1966                  .49,934                4),
                        1967                  54,296                 5)338                  48,958
                        1968                  59,218                 4,664                  54,554
                        1969                  66)336                 4@916                  61,419
                        1970                  74@047                 5,561                  68@486
                        1971                  90,259                10@815                  79,494
                        1972                  98)155                12@436                  85)719
                        1973                 1105296                155643.                 94@653

                                                             -4-
<pb n="116" />

                                                                                            V47

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<pb n="117" />

           Adjustments   to Personal  Income Tax Receipts Data.

                 The raw  data includes many fluctuations that     inhibit

           estimation of future receipts, and even meaningful        study of

           past receipts..

                 First of  all, wide  seasonal  fluctuations are evident.

           Because  seasonalizing is   not practical with    this data (the

           pattern  is not  suffIiciently regular), twelve     month moving aver.-

           ages were taken, and the results.used to represent        the centered.

           month.

                 Next, research   was done into  the changes   in collections

           resulting from   'rate changes, procedural chan   ges, and   windfalls.

           Adjustments  were made as follows:

                 From.1960 through 1962, procedures for estimation,       with-

           holding, and final payments of the tax changed. These changes

           led to several,'one-time    adjustments.

                 From 1962  thr ough 1972,  the court ordered   divestiture of

           General Mo  tors stock by  the DuPont Company    led to a windfall of

           29.5 million   dollars.   This money trickled    in along with regular

           tax payments, and was    periodically shi  fted  out in large chunks.

           This resulted in misleading monthly fluctuations        ove r this period.

           While records do   not exist to permit a perfect adjustment,

           approximations were made.
                 During,102, and for    half of  1973,  50% of Capital Gains were

                                               5
<pb n="118" />

          not taxable income. To.put this period into.l.ine with the rest

          of the data, two million,dollars was.added in as an adjustment.

               In 1961, the rates fo r incomes of.over $30,'000 were raised.

          After examination of at income level breakdown, it was approxi-.

          mated that the.effect of this change was similar to whatwould

          have taken place with a 6.3% across-the-board increase. That

          adjustment was, made.

               In 1971, three things happened that led to needed adjust-

          ments. First, the   change to monthly withholding led to an adjust-

          ment of $3,000,000  in May.and $5,000 000 in June. Second, a

          rate.increase for incomes of more than,$20,000 came into,

          existence. The impact   of this change, approximated as above

          (the 1961 adjustment), was 14.26%.

               The other change  in 1971 was the switch to a modified

          piggyback method of figuring out the tax (using Federal Adjusted

          Gross Income). The effect of this change is nearly impossible

          to accurately determine, but,available,sources  suggest that it

          was similar to a revenue increase of 9.4%.

               In 1974, there was an across-the- board rate increase.of

          10%, for which the data was adjusted.

               The resulting data was then averaged over twelve  month

          periods as before.

                                         -6-
<pb n="119" />

           DELAWARE CODE CHANGES    PERSONAL INCOME TAX

           Effective
             Date                      Description of Change

           2-01-61      End of quarterly payments  of tax after payment of
                        tax for 1960 which is to be paid @4 by 4/30, -2 by
                        6/15, and -4 by 10/30.

           7-01-61      Rate. increase for incomes over $30,000.

           9-09-61      Minor change in withholding  procedure.

           1-01-62      Allowance for accelerated deduction of losses in
                        "disasters."

           4-17-62      Provision for estimation of  taxes and payment therefor.
           4-19-  @62   Capital gains from stock distribution to,  be only '50%
                        taxable,(GM-DuPont divestiture).

           6-21-63      Exempted income of non-resident partners whose, income
                        IS not related to the state.

           7-18-63      Changed definition of dependent.

           12-17-63     Minor easing of refund procedure.

           1-01-64      Union dues-made deductible.

           6-09-65      Foreign corporations withholding Delaware incom   e
                        taxes must post surety bond.

           1-01-66      Interest rate for late payments raised-from 4% to 6%.

           2-25-66      Federal gift taxes no longer deductible.

           3-09-66      Provision making information returns .(dividends,
                        interest paid) more numerous.

           1-01-67      Several definitions  changed, non-residents now
                        required to apportion deductions like income, end   of
                        reciprocal agreement with Maryland.

           1-01-68      Added definition of a deduction    for "Head of House-
                        hold.

                                           -7-
<pb n="120" />

           Ef fective
             Date -                         Description of Change

           1-01-69        Notification of staterequired for those amending
                          Federal returns, change in-treatment of gain from
                          sale of home, deduction allowed       'for care of depen-
                          dents to free taxable for work.

           6-19-69        Interest rate for refunds raised from 4% to 6%.

           6-28-69        Interest rate for late payments        raised from 6% to
                          12%.

           7-10-70        Deduction up to $300 allowed.for expenses of
                          adoption.

           7-14-70        Interest rate on refunds, late payments where           exten-,
                          sion is granted raised from 6% to 12%.

           7-23-70        Establishment    of. Finance Department.

           1-01-71        Renovation of    the Perso  'nal income tas, estimation
                          'dates to coincide with those for federal         taxes.

           5-06-71        Thase  withholding more than $200 monthly         must deposit
                          those  withholding monthly-

           8-01-71        Rates  increased for incomes over $20,000.

           1-01-72-       Capital Gains made only 50% taxable.

           -3-29-72       Date for April estimation 'changed from 15th to          30th.

                          Maximum  income for those using exemptions raised,
                          everyone.  now permitted to itemize deductions.

           4-26-73.       Interest   now paid on refunds held over 45'days.

           7-01-13        Taxes paid to subdivisions'of other states no longer
                          credited.

           7-06-73        Capital Gains once again 100% taxable.

           1-01-74.       Rates raised at all income levels (10%           increase).
<pb n="121" />

            OTHER  FACTORS AFFECTING DATA      PERSONAL INCOME TAX

                1962 - According to the Tax Department,     this was a   year of
                       improved enforcement.

            1962-65 -  Court forced divestiture of     stock by DuPont    Company and
                       family-led to windfall capital gains inflating income
                       tax receipts by 28.6 million dollarsover the years
                       noted.

                .1964  Refunds were   paid relatively earlier than     in recent
                       years.

             1964,65   Preliminary, final agreement of cooperation with
                       Internal Revenue Service.

                1964   (December) Due to the Federal tax C'ut,,many       persons
                       paid their state tax early.

                1965 - All refunds out by end of July.

                1966 - Tax Department   extablished "Trouble Section".to notify
                       delinquents.

                1967 -.Refunds went   slowly (70% by end of July)

                1968 - Refunds  out relatively fast.

                1968   Tax Department   went to Merit.System of employment.

                1969   Refunds slow-75% by August 1, 100% byAugust 15.

                1970   Money appropriated for "modernization" of Tax Department..

                1970   Six  new field  auditors hired.

                1970   Refunds  slow-some say on purpose to make      fiscal 1970
                       look better on paper.

                1971   Division  of.Revenue began using computers.

                1972   Refunds very late--not all out until October.

                1972   According to independent autidors, the year marked a
                       "significant turnaround    in performance" by the
                       Division of Revenue.,

                                               _9"
<pb n="122" />

             1973   Refunds out quickly--resulted in $5 million paper
                    cost in fiscal 1973.

             1974   Refunds out quickly--94% by May 30.

                                        _10-
<pb n="123" />

                           TTI. CORPORATTON FRANCHTSE TAX

                The Franchise tax is the price a  corporation must pay  to

          enjoy the benefits of being incorporated under the laws of

          Delaware.   This tax is levied upon all,domestic corporations

          regardless  of whether they do any business in the state.,

                Delaware is often referred to.as "The Corporation State"

          because of the extraordinarily large number of incorporations

          here (including approximately 40% of the companies listed on the

          New York Stock Exchange, and a  majority  of the 100.1argest

          corporations in the country).   While the  Delaware Franchise tax

          is not high, there are  many states with lower ones,, and others

          with no such tax at all. Thus, while the tax cos   t of. locating

          in Delaware is certainly one, factor affecting decisions on wher  e

                                   r "drawing card" of the state is its
          to incorporate, the majo

          combination of an updated legal framework favorable to corpora-

          tions and a predictable,,efficient court system.

                The tax is imposed.on all-.corporations except banks, build-

          ing and loan  companies, companies with assets,in unfriendly.

          nations,  agricultural cooperatives, drainage companies, and

          religious, charitable, and education organizations.,

                Tt isbased on either the total number of authorized shares

          of,capital stock or gross assets (a term left undefined until

          July.16, 1974), whichever calculates to be the lesser tax.
<pb n="124" />

          Corporations which are ina ctive for a tax year pay only 50% of

          the normal tax payment usually required.

               An important feature of the Delaware system is the existence

          of both a minimum and a maximum tax ($20, $110,000, except

          Regulated Investment companies, for which the maximum is

          $55,000). A 1969 report showed that 30 companies were paying

          the maximum $110,,000 figure, while 10 were paying the $55,000

          maximum. The significance of these rates is evidenced by the

          fact that in 1962, General Motors acknowledged that without

          the ceiling, they would have owed $1,300,000 under the  then

          existing rates. There has beenconstant debate as to what

          effect an increase in the maximum tax would have, would revenues

          be increased or would enough corporations leave the state or

          decide not to move here to make'such an increase fruitless?

          Several studies have expressed the belief that since it is the

          General Corporation Law and not the Franchise tax that attracts

          corporations, significant untapped potential still exists and an

          increase in themaximum would be an  easy way to increase'state

          revenue. Those opposing such a move, including the Department

          of State, note that Delaware, while collecting less than some

          states in absolute dollars, relies on the franchise tax for a

          much greater percentage of its revenue. than any other state.

          Because of the.size of this percentage, those people do not want

          to risk losing the "goose that lays the golden egg."

                                        -12-
<pb n="125" />

                Payment of the tax is due annually on March 1, and corpora-

           tions in arrears for more  than one year have their charters voided.

           Under a recently changed  procedure, the corporations determine

           their own tax bill and file a return with their payment.

                The tax is collected and administered by the Franchise

           Tax Division, D,epartment'of State.

                                          -13-
<pb n="126" />

                                                                V@: L

                                                                                                            TAX DATi

                                        R TFRAN
            i.00    ---w.Q0         ISO Go     240.00        01 C-I 0. 40   0 0    +80.00      11%0.00     640.00

         0

         21
         b
         0

        rn

                                  co    tl

                                  (D    rt

                                  0

                                  H.

                                  GQ

         0                        CrQ
<pb n="127" />

            Adjustments of Franchise Tax Data

                 Several adjustments were made on.the data for Franchise

            Tax collections.

                 First, recent changes in due dates necessitated a   shifting

            of data from one month to another (for instance, data for

            July, for the years in which the tax was due July 1, was

            shifted-to March, since the tax  is now due on.March 1) in order

            to have a consistent and usable  pattern.

                 Because of late deposits arising,out of Fiscal Year   budget-

            ary "games" the figures for  June and July of 1969 were reversed.

                 Prior to the increase  of the maximum tax to $100,000

            (in 1961), $1,2502000 was added to each year's figures.

                 Prior to the 10% rate increase in 1970, all data was

            adjusted upward by a factor of 1.10 to compensate.

                                          -14-
<pb n="128" />

           DELAWARE CODE CHANGES                 FRANCHISE TAX

           Effective
             Date                      Description of Change

           1-01-61     Maximum  tax raised from $50,000  to $100,000.
                       Maximum  for Regulated Investment Companies stays   at
                       $50.liooo.

                       Minor procedural change shortening p  .eriod.f.or.filing
                       of annual report.

           1-01-66     Minimum tax changed to   $10 for companies with  less
                       than .1000 shares (was  $5.50 for less than 250,,$11
                       for 250-10,000).
                       Review and appeal procedures changed.

           9-01-66     Moved from Tax Department to Department of State.

           .7-15-69    Minimum.tax raised to $20, maximum to $110,000,
                       others up 10%.

           1-01-70     Professional corporations no   longer exempt.

           7-01-70     Last day for.payment changed   from July 1to June 1.

           1-01-71     Corporations in arrears.for one year will be voided
                       (was 2 years).

           7-05-71     Investigations  of corpora tions. failing to file made
                       discretionary.

           1-01-73     Last day for payment changed to   March 1, corporation.s
                       now figure out own tax and,file    returnIs.

                                          -15-
<pb n="129" />

           OTHER FACTORS AFFECTING DATA   - CORPORATION FRANCHISE TAX
           1962 - Overstated relative to 19'61 by delays (June, July, 1961)

           1964 - Computers used by Tax Department for Franchise     tax

           1966- Back,to manual administration in State     Department

           1967 - Major revision of General Corporation.L   aws

           1969 - July overstated by   late reporting

           1970 - Field audits began

           1971   State Department switched to   computers

           1973   Return system more efficient,    according to  State Depart-
                  ment

                                          -16-
<pb n="130" />

                                IV. CORPORATION INCOME TA     X

                  The Delaware Corporation    Income Tax was   instituted in 19581.,

            and  is similar to taxes in   neighboring states. Two      departures

            from  the "usual" corporation. income tax are present      and notable.

            --Investment and Holding Companies are exempted,       and.liberal

            deductions are allowed-with respect.to-intercorporate dividends

            and  interest from investments.     There have been recent    moves to

            put  the Delaware tax in line with the others,, but so.far these

            peculiarities remain at least partially in force.

                  Certain groups of corporations are exempt@in      addition to

            those named. Included in this catego      ry are insurance companies

            domestic international sales corporations,, fraternal organiza-

            tions, corporations or trusts created for religious, charitable,

            scientific, or educational purposes.'and.     non7profit corporations,

            in general.

                  Both domestic  and foreign corporations are subject      to this,

            tax,,which is.levied on net.income     from business.activi.ties.

            and/or property within the state.      If a company does all    of its

            business in the state,    taxable income is substantially that

            computed for federal purposes. Companies doing some business

            and/or  owning some income producing    Iproperty outside the state

            pay for only that part of their     income  connected with the state.

            This figure is ascertained    by  averaging three ratios (property
<pb n="131" />

          owned in the State/all property owned, wages and salaries paid

          in the state/all wages and salaries paid, gross receipts in the

          state/total g ross receipts) and taking the resulting proportion

          of the company's  total Federal net income.

               The fact that Delaware has no sales tax, coupled with the

          fact that her neighbors do, means that non-residents often    do

          ,their shopping in this state. Therefore, it is conceivable

          that changes in sales taxes in these neighboring states could

          affect sales, thus profits, and thus corporation income tax

          revenues in Delaw .are.

               The present rate of the tax is   7.2%, and the tax is payable

          on the first day of the fourth  month following the. end of the

          company's fiscal year (about 60% are calendar year companies,

          paying on April 1). A t.entative payment of an estimated 50.%

          of the tax is made each year  on the first day of the fourth

          month of the current year.

              .To encourage community awareness and improvement, a deduc-

          tion of up,to 5% of the tax,or $50,000, whichever is smaller, is

          allowed to companies involved with "neighborhood.assistance.11.

          This deduction cost the state  over $550,000 in its first three

          years, but presumably, the benefit to the statefrom these

          assistance projects is such as to justify the deductions.

               The tax is collected and administered by.the Division    of

          Revenuel Department of Finance.
<pb n="132" />

                                                      V81
                                                                                           TAX DATA'

                               R'll c 0 R            0 R
                                                           IV  C-41  120 00    140.00     *0.00
        00      20.0c,     40.00     W.00)

                                                                                                 C,3

                                                                                                 F-4

                                 rt
<pb n="133" />

            Adjustments of Corporation Income Tax Data

                 There have been two rate changes since 1960 for which it

            was necessary to adjust the data.
                 In 1968, the rate was raised from 5% to'6% of..net intome,

            and then in 1971 the rate was upp ed to its current level of,

                 Due to these changes, thedata up  to.December,19.69 has

            been multiplied by 1. 44 while that up to,December 1971 was

            upped by a factor of 1.20.

                                         -19-
<pb n="134" />

           DELAWARE CODE CHANGES     CORPORATION INCOME TAX

           Effective
             Date                       Description of Change

           4-06-60      Small change in refund procedure.

           1-01-66      interest rate for late payments raised, 4%      6%.

           1-01-68      Neighborhood tax credit introduced.

           5-08-69      Penalty for failure to file up to 5% per-month.

           6-19-69      Interest rate for those granted extension rais@ed,,
                        4%    6%.

           6-28-69      Interest  rate for late payments,raised, 6%      12%.

           7-01-69      Tax rate  raised, 5% - 6%, tax base widened to include
                        some of interest, capital gains, interest.

           7-14-70      Interest  rate for those granted extension raised,,
                        6% - 12%.

           7-23-7V      Shifted to Department of Finance.

           8-01-71      Surcharge  into effect, 20% of tax

           1-011-72     Domestic  international sales corporations exempted.

           7-01-72      Neighborhood tax credit   changed to deduction.

           1-01-73      Expenses relating to interest income from U. S.
                        securities must be added in to get Delaware taxable
                        income, discretion allowing in weighting of three
                        factors for non-residents, no interest is to,be
                        charged for an underestimation if.it is at least as
                        great as the previous year's actual  .income, but in
                        general penalties for lateness, etc. apply to
                        tentative payments.

           7-01-73      Surcharge ends.

           7-06-73      Tax rate raised to 7.2%, refunds are to be paid from
                        General fund.

                                          -20-
<pb n="135" />

           OTHER FACTORS AFFECTING DATA     CORPORATION INCOME TAX

              1960 - Steel strike

              1962 - According to the Tax Department, this was a year     of
                 -    improved enforcement

           1965,66 -  Enforcement ag
                                     ain stepped up

              1968 -  Tax Department went on Merit   system for employment

              1910 -  Money appropriated for "modernization of Department"

              1970 -  Major strikes

              1970 -  Field audits began in July

              1971 -  Department began to use computers

              1972 -  Independent auditors noted "a significant    turnaround
                      in performance" by Division of Revenue.

                                          -21-
<pb n="136" />

                                 V. MOTOR FUEL TAXES

                The Delaware Motor Fuel Tax is divided into two parts--

          the Gasoline Tax and the Special Fuels Tax. The current rates

          are 9@ pe r gallon for gasoline  and 8@. per gallon for special

          fuels.

                The tax is imposed on all motor fuel sold at retail or   used

          in the state. Fuel sold to thestate or its political sub-

          divisions and that used for private use of the streets and

          highways (such as for lawn mowers, farm vehicles, boats,     air-

          planes, etc.) is exempt@@from the tax.

                Distributors and retailers must make reports and pay their

          taxes monthly. Both distributors and retailers must also be

          licensed, and bonded.

                There is a related tax which.indirectly affects the Motor

          Fuel tax receipts. That is the Motor Carriers Road     Tax. This

          has been imposed to assure that users of the state's highways

          pay their share of the expenses of maintaining the roads even

          if they d-o not purchase th eir fuel here. Undoubtedly, the

          imposition of this tax and the way it is set up'have caused

          many road users to buy their gas, or at least-part of it, in

          Delaware.

                The Motor Fuel Tax is typical of a consumption based tax

                                         -22-
<pb n="137" />

           in that it-affects the  incomes of lower m:H dle class'taxpayers

           more (percentage-wise) than it affects others.

                The tax is collected and administered by the Motor Fuel

           Tax Division, Department of Public Safety.

                                         -23-
<pb n="138" />

                                                                                     TAX 'DATf

                               R TMFL          ATMFL mlo?
         .00      lp 00    20.00     SP.00    4C.00     50.00    W.00      ?P.oo    sp.00

                                            mlw -W--

       a4

     -4b
     1-40

                                                                                          t-4

                                  &gt;

                                   11

                                  Li

                                       rt
<pb n="139" />

          Adjustments of Motor Fuel Tax Data

               There were three different types of adjustments made in

          the data for Motor Fuel Tax collections.

               One type had to do with a late report by one large oil

          company. This resulted in changes of the figures for December

          1973 (from $1,891,000 to $2,142,000),and January 1974 (from

          $2,557,000 to $2,234,000).

               The second type of adjustment was due to procedural

          inefficiencies while the tax was the responsibility of the

          Division of Revenue, from July 23, 1970, until July.17, 1973.

          The data during this perio d has been smoothe d into a more

          regular pattern, while the overall total has been retained.

               The other type of adjustment was due' to the various rate

          changes. The rate went from 5e, per gallon to 60, on December 15,

          1961, to 7(,% on August 1,, 1965,. to 81@ on August 1, 1971, and to

          9@- on August 1, 1973. on July 1, 1967, sales to the state and

          its political.subdivisions were exempted from the tax, and this

          led to an adjustment of about 2%. The following factors were

          used to properly adjust the data,for,these changes in rate

          (actual or effective): 1.764 up to 12/61; 1.47 up to 8/65;

          1.262 up to 6/67; 1.28 up to 8/71; and 1.125 up to 8/7,3.

                                       -24-
<pb n="140" />

            DELAWARE CODE CHANGES    MOTOR  FUEL TAX

            Effective
              Date                      Description of  Change

             12-15-61    Rate raised for all fuels from 5(,% per gallon to 6(,%.

             7-16-63     Tax divided into Gasoline Special Fueld,    procedures
                         revamped, provisions for licenses, bonds instituted.

             6-09-65     Maximum rebate from this  tax to municipalities
                         raised from 1.2 to 2 million dollars (no effect on
                         receipts).

             8-01-65     Rate for both classes raised from  6o, to 7(,%.

             7-01-67     Sales to the state and subdivisions   thereof exempted.

             7-01-70     Institution of Motor Carriers Road Tax

             7-23-70     Collection and administration duties moved from
                         Highway Department to Finance Department.

             8-01-71     Rate for both classes raised from 7c, to 8@-.

             1-01-71     Adoption of reciprocal agreement with other states
                         regarding exemption from Motor Carriers Road Tax--
                         presently affecting only Pennsylvania, but potentially
                         any other state adopting similar agreements.

             7-17-73     Collection and administration duties moved from
                         Finance Department to Department of Public Safety.

             8-01-73     Rate for gasoline only temporarily raised (through
                         6-30-74) to 90, (was ermanently raised to 9(,% in
                                              p
                         June of 1974).

                                           -25-
<pb n="141" />

           OTHER FACTORS AFFECTING DATA      MOTOR FUEL TAX

              1964 - Completion.of Delaware Turnpike

           1973,74 - Fuel crisis, voluntary rationing

                 Gasoline tax rates in neighboring states per gallon

                 1959   60 61 62 63 64        65 66 67      68 69 70 71      72 73

           Del.   5     5   5    6   6'   6   6/7 7    7    7   7   7    7/8 8    8/9

           Md.    6     6   6    6   6    6   7     7  7    7   7   7    7   7    9

           Pa.    5     5   71   7   7    7.  7     7  7    7   7   7    8   8    8

           N.J.   5     .5  6    6   6    6   6     6  6    6   7   7    7   7    8

                                            -26-
<pb n="142" />

                       VI. BUSINESS AND OCCUPATIONAL LICENSE TAX

                 Licenses are required in Delaware for the privilege of

            performing certain occupations and conducting certain bus'inesses.

            Licenses perform both regulatory and revenue functions in that the

            standards set for issuance of licenses act to regulate while the

            fees help to build state revenue.

                 Prior to 1969, rates were quite low, the tax base was fairly

            narrow, and enforcement was almost non-existent. However, since

            then, licensing has been updated in all areas. The biggest

            changes are in the areas of gross receipts of wholesaler-s,

            contractors, manufacturers, and others,.and of purchases by

            retailers. In addition to a flat-annual fee of $30 (payable on

            July 1), each of the above mentioned persons or companies must

            pay a percentage of their gross receipts or, in the case of

            retailers, purchases. The fact that retailers pay a percentage

            of their purchases rather than receipts can  be criticized for

            le ading to a higher percentage tax on low mark-up items than on

            high mark-up goods. The 1969 revision of   the law increased the

            percentage rates drastically and established a system whereby

            these "fees" are paid quarterly. These gross receipts and

            purchases percentage fees dominate the totals for this tax

            category in that they account for approximately 90% while the,

            flat licensing fees account for only about 10%.

                                          -277
<pb n="143" />

                The Business and Occupational License Tax is collected and

           administered by the Division of Revenue, Department of Finance.

                                         -28-
<pb n="144" />

                                                                     vez
                                                                                                                         TAX DATI

                                             R T L I t"            AT L I C'    It  .0
                                       160.00        240.OC       3r;fj- . 0 C 400.00        t80.00       TO.00          40.00

                                                                                                                        En

                                                                                                                       Cl.

                                                        tv
<pb n="145" />

           .Adjustment of License Tax Data

                Because of the massive changes on July 1,.1969, which brought

           the License Tax from a relatively minor tax  position into

           prominence as a substantial revenue source,  comparisons cannot

           realistically be made from one side of that  data to the other.

           Therefore., no adjustments of importance were made to the prior

           data.

                However, the newer data has been updated to keep it in line

           with current receipts. Twice, there were lump sums    paid as a

           result of court action for back taxes. These sums     ($1,100,000

           from General Motors in August, 1969, and $1,32,000 from Delmarva.

           Power and Light in October, 1971) have been deducted   from the

           data as they are misleading to anyone trying to discover payment

           patterns and trends.

                Beginning in May, 1970, the exemption from the   mercantile

           tax was raised from $25,000 per year to $20,000 per   quarter.

           The effect of this was about  a 4% drop in'license tax receipts.

           In August., 1971, the gross receipts tax rate for manufacturers

           was raised from .1% to .2%, and since this area of the tax

           (manufacturers gross receipts) represents about 27% of the total,

           this change had an effect similar to an overall 13% rate increase.

                The two aforementioned changes were adjusted for by

                                         -29-
<pb n="146" />

          multiplying the data for the period after  July 1, 1969, and before

           September, 1971, by 1.13, and that between July 1, 1969, and

          May, 1970, by an  additional factor of .96.

                                         -30-
<pb n="147" />

            DELAWARE CODE CHANGES,- BUSINESS AND OCCUPATIONAL LICENSE TAX

            Effective
              Date-                      Description of Change

                         Throughout period--minor changes in rates, base.

            7-01-69      Massive revision of rates,, base, procedures,-
                         including:
                         Contractors from  $5, 1/10% to $30, 1/2%
                         Manufacturers from $5, 1/40% to $30, 1/10%
                         Wholesalers from $5, 1/7% to $30, 1/5%
                         Retailers from $5, 1/7% to $30,4/5%

            4-30-70      Mercantile exemption raised from $25,000 per ye    ar
                         to $20,000 per quarter.

            7-23-70      Collection and  administration moved to Finance
                         Department.

            8-01-71      Rate for manufacturers raised from 1/10% to 2/10%.

            6-30-73      All sales to the state   classified who lesale.

            OTHER FACTORS AFFECTING DATA     BUSINESS AND OCCUPATIONAL LICENSE TAX

            Throughout 1960's--Most lax area of collection

           .1963   Some recording of payments delayed by shift to computer

            8-19-69 - General Motors paid $1,100,000 in.back fees
            9-22-71 - Delmarva Power and Light paid $132,000'in back fees

            1972 - Massive effort by officials to enforce existing laws..

            Also note sales taxes of neighboring states (accompanying
            material on Corporation Income Tax), for changes in these taxes
            may cause.more persons to shop in Delaware, thus     affecting
            fees for the businesses involved..

                                           -31-
<pb n="148" />

                                  VII.   TOBACCO TAXES

                The tobacco taxes of Delaware are divided into two

           divisions--cigaret tes and other tobacco products. Cigarette

          :taxes.are based on each ten cigarettes sold, so that the present

           tax of 7(,% leads to an effective tax of 14(,% per package of twenty

           cigarettes.

                The cigarette  tax is imposed by requiring a stamp on    each

           package transferred in Delaware. A stamp is applied only      once

           per package and must be affixed by the first possessor in     the

           state. Stamp affixers must pay for their stamps by the end of

           the month following their purchases, except that all stamps

           purchased in June must be paid for in June for fiscal year

           accounting purposes.

                This tax is quite regressive, taking a significantly.higher

           proportion of a taxpayer s income,, the  lower that income is.

                Rates vary widely from state to state and constitute a,

           significant percentage of the price to the consumer, so any

           changes in the tobacco tax rates between neighboring states can

           have unexpected results (for instance, even if the overall

           elasticity of demand for cigarettes is very slight, the avail-

           ability of lower taxes nearby could lead to an actual decline or

           more likely a diminution   of the expected increase in revenue

                                          -32-
<pb n="149" />

           following an increase in tax rate in some circumstances).

           Delaware, being a very small state, is especially vulnerable to

           such effects.

                The tax on other tobacco products (30% of the wholesale

           price) was instituted in 1969, but after collections of only

           23P,, acourt test led to the invalidation (on Constitutional

           grounds) of the method of imposing the tax. The tax  is still

           on the books, however, and it seems that it would be a very simple

           procedure to begin enforcing it. Nevertheless, it has been lying

           dormant for almost five years.

               The cigarette tax is collected and administered by,  and the

           power to collect and administer the tobaccaproducts tax  lies

           with, the Division of.Revenue, Department of Finance.

                                        -33-.
<pb n="150" />

                                                                                                                                                                           v r-
                                                                                                                                                                                                                                                                                             TAX DAT'(

                                                                                                        RJCIG
                                  00                       so 00                           IC-0.00                        14-IT, .00                       211 c        015 0,
                                                                                                                                                                                                                                                          350.00                          !PO.00
                        b
                                                                                                                                                                                                        ok I

                        b

                                                                                                                                                                                               AC==-

                                                                                                                               ca
                        call
                        b

                        cn
<pb n="151" />

            Adjustments of Tobacco Tax Data

                 Two types of adjustments were made in     the Tobacco Tax

            Data. First, because of payment deadlines, June is a big

            collection month and July a small one. This is a recent develop-

            ment, and data for those   years prior to 1971 have been changed

            accordingly.

                 The tax rate has changed several     times: from 30, to 5r, per

            pack of 20 cigarettes in 1961; to 7,,s   in 1965,; to l1r, in 19 69;

            and to 14(,k in 1971. Adjusting for these changes meant multiply-

            ing the data by @he following fact.or,s: before November 1961,,

            4.67; up to July@1965, 2.80; up to June 1.969, 2.00; up to

            July 1971,, 1.273.
<pb n="152" />

            DEIAWARE CODE CHANGES   TOBACCO TAX

            Effective
             Date                      Description of Change

            11-01-61    Rate raised from 1 1/2 to 2 1/2 cents per ten cigarettes.

            6-01-64     General provisions, procedures of tax updated.

            8-01-65     Rate raised from 2 1/2 to 3 1/2

            12-22-65    Penalties for evasion of the tax tightened.

            7-01-69     Rate raised from 3 1/2 to 5 1/2, 30% tax on other tobacco
                        products imposed..

            7-23-70     Responsibility of collection, administration to
                        Finance Department.

            8-01-71     Rate raised from 5 1/2 cents to 7 cents, stamp affixers now allowed
                        to pay for stamps by end of month following.purchase,
                        except in June (previously, payment was required upon
                        purchase).

                                          -35-
<pb n="153" />

           OTHER FACTORS AFFECTING DATA     TOBACCO TAX

           1962   Field audits began

           1965   Completion of Delaware Turnpike--hurt sales (fewer
                  stopping points)

           1966   State joined a multi-state cooperative.to cut down on,
                  illegal imports and sales (The North Carolina Operation)

           1968   Increased efficiency, according to the department

           1969   December 17--Court of Chancery finds. collection procedure.
                  for tobacco products unconstitutional

                          Rate  of tax per twenty cigarettes

       state  1959 60   61 62    63 64    65   66 67 .68 69       70  71     72., 73@1

       Del.    3    3   3    5   5   5    5/7 7 7       7   7/111 11  11/14  14  14

       Md.     3    3   3    6   6   6    6    6    6   6   6     6   6      6  @6

       Pa.     5    6   6    6   6   8    8    8   8    13  13    18  18     18  18

       N.1J.   5    5   5    7   7   8    8   .8    11  14  14    14  14     14  19

                                           36-
<pb n="154" />

                           VIII.   MOTOR VEHICLE REGISTRATION

                 All motor vehicles, trailers, semi-trailers, and pole

           trailers that are "driven or moved" must be registered and

           licensed by the state.

                 There is a flat rate of $20 per year for "pleasure vehicles,"

           a category that encompasses thevast majority of registered

           vehicles. The other classes have rates based on the weight

          @of the individual vehicle. Thepleasure vehicle rate once was

           also determinedby weight, and,the change     to a flat rate has

           brought much criticism from those who feel that the small car

           owners are paying part of what the big car owners.should be

           paying.

                 The licenses are valid for one   year, and they.expire. at the

           end of the corresponding month in which they were issued     the,

           previous year. A recent change from quarterly expirations was

           effected in order to spread the vehicle inspection,load out as

           much as possible and thus to lessen the peak load problems

           around the deadline dates.

                 These regulations are administered   and fees  collected by.the

           Department of Public Safety.

                                          -37-
<pb n="155" />

                                                                                                                  VL C

                                                                                                                                                                                         TAX DATi

                                                                    RTREG                              ATREG                  0"
                     ,Go                                  --ep.oo               yo.oo                %so.oo              200.00               @40.00              2FO.00- :3-4LOO

                                                                                 &gt;
                                                                                                                                                                                              i-3

                                                                                 rt        o)
                                                                                 m         rt
<pb n="156" />

           'Adjustments of Motor Vehicle Registration Data

                 In 1965, there was a rate change for pleasure vehicles.

           Prior to  the change, those pleasure vehicles weighing more

           than 4000  pounds were taxed at.$16 per year, while those weigh-

           ing less were taxed,at $10. After the change, the two classes

           were eliminated, and all pleasure.vehicles were and still are

           taxed at a rate of.$20 per year.

                 Since thetime  of the change, light pleasure vehicles have.

           accounted for about  75.9%.of the.total tax receipts from pleasure

           vehicles, and heavy  ones about 24.1%, for an overall net increase

           of 81.9% in the pleasure vehicle category. Since   pleasure

           vehicles were about 39.7% of the  total Motor Vehicle Registra-

           tion Tax,,the net effect of the change was an increase of 32.5%.

           so all data prior to July, 1965, was multiplied by.1.325.,

                                         -38-
<pb n="157" />

            DELAWARE CODE CHANGES    MOTOR VEHICLE  REGISTRATION TAX

            Effective
              Date                      Description  of Change

            9-29-61      Small rate increase in some  minor areas

            7-01-65      Pleasure vehicle rate raised from $10 (up to 4,000
                         pounds), .$16 (over 4,000 pounds) to $20 (regardless
                         of weight).

            6-30-70      Changed from quarterly to monthly expirations.

            7-06-70      Collection.and administration duties moved from
                         Highway Department to Department of Public Safety.

            5-21-73      New category introduced, recreational vehicles.

                                          -39-
<pb n="158" />

                           IX.' INHERITANCE   AND ESTATE,TAXES

                Delaware employs both an.   estate tax,.and,an   inheritance.tax..

           The former exists merely to make use of allowances in the cor-

           responding federal law. The latter, which comprises the bulk

           of the revenue from this source),has,a fairly complex rate

           system, broken down by the amount of-the inheritance and the

           re lation of the giver to,the receiver (higher rates     for more

           distant relations).

                This tax is oxtremely-unpredictab.le.as-f,ar as,receipts

           are concerned. Delaware is such a small state (population-

           wise) that the death.of'a single.very rich.person wil     1 cause a.

           notable upturn in any yearls inheritance taxes.. While actuaries

           can--give us a reliable estimate as to-the number     of Delawareans

           who: will die in any given year, they cannot accurately predict

           when members of the DuPont family    will die. Such a prediction

           would be needed in order to make    any usable forecast of receipts

           from this tax. The only viable alternatives are (1) to       not make

           predictions regarding this tax,,and to.consider its proceeds as

           a windfall of.sorts,,or (2)    to make rough predictions for

           receipts over-a large number    of years,  and-use those receipts

           for some long-term goal.

               '@These taxes are collected and   administered by the Division

           of Revenue,, Department of Finance,.

                                           -4o-
<pb n="159" />

                                               VOV

                                                                                TAX   DATA

                            RTEST           ATEST   gtio2
                20.00    40.00    GO.Clo   SVI.00   Im.00    =0.00    1P.00    @fwoo

     3.

   164

                          CL

                              Cl
                          CT  P)

                         m
<pb n="160" />

           DELAWARE CODE CHANGES   INHERITANCE AND ESTATE TAX

           Effective
             Date                     Description of Change

           7-30-71,    Redefinition of brackets in some areas, and extensive
                       rate increase in all areas of inheritance taxes.

           9-30-71     implementation ofState Gift Tax.

                                        -41-
<pb n="161" />

                                X. ALC'OHOLI.C.BEVERAGE TAX

                 Taxes are imposed on the distribution of alcoholic beverages

            in Delaware. All makers, distributors,.and*retailers of such

            beverages must be licensed   by the state.   The tax  is imposed

            on whoever makes the beverages within the    state,  and whoever

            brings them already made into the state.

                 Although tax rates vary widely from state to state and

            constitute a large percentage of the price to the consumer,

            probably the  largest factor  causing Delawareans to buy    liquor

            and beer in other states (which is technically illegal      except

            for one quart per person per   day, but unofficially permitted)

            is the existence of fair trade laws that wholesalers use to

            their advantage to force sellers in    this state to charge

            articicially high prices. -Because of these "laws," discount

            liquor stores in Maryland ar  e easily able to undersell.their

            11competitors" on this side of the state line.

                 The currentrates are:

                         Per barrel of Beer      $2
                         Per gallon of Wine      $.40
                         Per gallon of.Spirits
                               25% of less ethyl alcohol       $1.50
                               more than 25% ethyl alcohol- $2.25

                 The tax on spirits of more than 25% ethyl alcohol brings in

            about half of the receipts. Beer is the next most productive

            area, followed  by wine, and then spirits   of less than 25% ethyl

            alcohol.

                                           -42-'
<pb n="162" />

                                                                    vision
               These taxes are collected and administered by the Di

          of Revenue,, Department of Finance, with aid from the Alcoholic

          Beverage Commission..

                                        -43-
<pb n="163" />

                                                                          vbv

                                                                                                                            TAX DATA

                                            RTALC                   RTAI-C, Rio"
                                                                                2010.00        240.00        2FC.QO        SFO.aO

                                                                                                                            &gt;

                                                                                                                            0
         M_                                UAW=

        2-

                                 &gt;

                                 (D
<pb n="164" />

           Adjustments of Alcohol Tax Data

                The Alcohol Tax Data as represented here is  the sum of

           taxes on Wine, Beer, Spirits, and other things.   The receipts

           from the Beer Tax comprise about 20% of the total and Wine Tax

           receipts come to about. 10%. Spirits is divided in two groups

           depending on the ethyl alcohol content. The tax1on spirits

           with less than 25% ethyl alcohol comprises only about Mof    the

           total, while that on spirits with 25% or moreethyl alcohol

           accounts for about.50%.

                These percentages are vital to judging the effect  ofrate

           changes. Adjustments were made as follows.

                In 1961, the Wine Tax was raised by 130%, so  an adjustment of

           13% was necessary. In 1969, the higher Spirits Tax rate was

           raised by 45%, so an adjustment of 22% was made.   In 1971, both,

           Spirits Taxes were increased (low by 67%, high by  36.4%). which

           led to an adjustment of 18%. Then in 1972, the Wine Tax was

           lowered by 50%, which necessitated a 5% adjustment..

                Specifically, the overall (cumulative) factors were:

           1.545 up to June, 1961; 1.368 up to June 1969; 1.12 up to July,

           1971; and .95 up to September, 1972.

                                         -44-
<pb n="165" />

            DELAWARE CODE-CHANGES    ALCOHOLIC BEVERAGE TAX

            Effective
              Date                      Description of Change

            6-23-61     Rate for Wine raised from 35(,% to 80(,% per gallon.-

            7-01-69     Rate for spirits more than 25%, from $1.1  5 to $1.65
                        per gallon.

            7-23-70     Collection now by Finance Department..

            8-15-71     Rate for spirits more than 25%, from $1.65 to $2.25
                        Rate for spirits no more than 25%, from $.90 to $1.50

            10-01-72    Rate for Wine lowered from 80@. to 40@..

            6-25-73     Overall revision of licensing of  makers,  distributers,
                        retailers.

                                          -45-
<pb n="166" />

                        XI. PARIMUTUEL SALES AND ADMISSIONS

               Revenues from Equine racing establishments is broken into

          three areas--Horse (Thoroughbred) racing, Horse Racing in Kent

          County, and Harness Racing.

               Taxes are levied in each area both on a per capita

          attendance base and on the parimutuel.handle.. Current  rates are

          10C per admission for Harness Racing and Horse.Racing in Kent

          County, 20(,% per admission for Horse Racing, 5% of the pari-

          mutuel handle for Horse Racing and Horse Racing in Kent County,

          and 5k/.-of the handle for Harness Racing (12% of this tax is

          earmarked for the Delaware Standardbred Fund).

               These taxes are collected and administered by the Division

          of Revenue, Department of Finance with the aid of.the State

         .Racing Commission.

                                       -46-
<pb n="167" />

                                                  RACING DAYS

             Year         60    .61    62    63    64    65    66    67    68     69    70    71    72     73   74

        Dela. Prk.        55    54     54    52    55    55    55    55    61     60    61    65    64     65   65

        Dover Downs
        (thoroughbred)     0     0      0     0     0     0      0     0     0    54    54    44    43     54   2

        Dover Downs
        (standard bred)    0      0     0     0     0      0     0     0     0     0    42    85    78     74   7-

        Brandywine                                       89    75    92,   100   101    101   101   101    104  13E

        Georgetown                                        0.   68    58    77     65    44    18    29       0

        Harrington                                       36    40    55    62     56    76    62    68     64   8(

        TOTAL                                           170    238   260   300   336    378   375   383   361 38@'

                                                    Unavailable
<pb n="168" />

                                                              .VL'7

                                                                                                           TAX DATA

                                     RTHOR                               C
          Do            .00     160.00      240.430      3tZ. il 0 C, 4061 40    4490.00     3SO.00       640.00
                    sp

      gal

                          &gt;
                          fal   lb

                          CA
                          rt    lb
                          m     rt
                          la.

                          lb
<pb n="169" />

           Adjustments of Parimutuel Sales and Admission Tax Data

                The rates for the various sources of this tax have changed

           numerous times .(see Delaware Code Changes). Research showed

           that recently, the subdivisions paid approximately the following

           shares of the totals reported here: Horse Racing, 31%; Horse

           Racing in Kent County, 7%; and Harness Racing, 55%.

                The above figures were used along with the rate changes as

           reported in the Delaware Code to come up with the following

           factors of adjustments: before June 1965, 1.36; up to July 1965,

           1.274; up to June 1967, 1.099; up to December 1967, 1.116;

           up to May1970, 1.048; up to December 1970, 1.80;.up to July 1971,

           1.096; up to December 1971, .97.

                This graph must be looked at in conjunction with the table

           concerning racing days through the years. The receipts by them-

           selves are not regular enough to provide guidance, but when

           looked at along with the days, some conclusions may be drawn

           as to the effects of increases and decreases.in meet lengths.

           A reliable adjustment for these changes can not be madebecause

           the elasticity of the tax receipts (by racing days) is not close

           enough to zero.

                                         -48-
<pb n="170" />

            DELAWARE CODE CHANGES       PARIMUTUEL TAX

            Effective
              Date                          Descri2tion   of Change

                          Throughout period--additions to length of permitted
                          meets (increase in total racing dates)

             5-26-65      Horse Racing handle rate raised from 4 1/2 to 5 1/2%.

             7-01-65      Harness Racing handle rate raised from 3 1/2 to 4 1/2%.

            11-01-65      Georgetown Harness Track opened.

             1-01-67      Law-clarified to assure prompt payment-       of taxes,
                          weekly.

             7-27-67      Horse Racing in Kent County section established,
                          rates 10cents  per admission, 4 1/2% of handle.
            12-29-67      Harness Racing handle rate raised from 4 1/2 to 5%.

             3-08-69      Dover Downs opened.

             5-28-70      Horse Racing handle    rate lowered from 5 1/2 to 5%.

             1-01-71      Horse Racing handle    rate  lowered from 5 to 4 1/2%.

             8-01-71     Horse Racing handle    rate  raised from 4 1/2 to 5 1/2%.
                          Horse Racing in Kent County handle rate        raised  from
                          4 1/2 t o 5%.
                          Harness Racing handle rate raised from 5 to 5 1/2%.

             1-01-72      Horse Racing handle rate lowered from 5 1/2 to 5%.

                                             -49-
<pb n="171" />

                              XII. REALTY TRANSFER TAX

                The Realty Transfer Tax is a tax levied on' the document.

           transferring ownership of real property. It  is lelvied,not only

           on sales of land (with or without buildings thereon) but applies

           equally to sales of condominiums,and transfers of rights under

           leases with a potentialduration ofat least   five years. The.-.

           present rate of the tax is 2% of value, and value:is ascertained

           usually by sale price, but sometimes by other,measures.

                The tax is collected and administered bythe Division  of

           Revenue, Department of Finance.

                                        -50-
<pb n="172" />

                                                                                                                VO!9

                                                                                                                                                                                             TAX DATA

                                                                    RTREL                              ATREI                xk-lol
                                      4P.00                80.00                yo.00                %60410@' ZW.Go                             240.00               T0.00                     0.00

                                                                                                                                                                               cn

         m
             -AIL                                                                                                                                                             &gt;

                                                &gt;

                                                           It

                                                          rb

                                                         lb

                                                         lb

                                                0
                                                .,4
             CL
                                                OQ

                                                (D

                                                OQ
                                                .M
<pb n="173" />

           Adjustments of Realty Transfer Tax Data

                The only adjustment made in the Realty Transfer Tax data

           was due to a doubling of the rate as of August 1, 1971. The

           adjustment was multiplication of all previous data by 2.

           DELAWARE CODE CHANGES - REALTY TRANSFER TAX

           Effective
             Date -                    Description of Change

           8-01-65      Effective date of the law (rate--I%).,

           7-23-70      Collection and administration duties  transferred from
                        Tax Department to Department of Finance.

           8-01-71      Rate raised from I to 2%.

           7-07-73      Condominiums and longleases made taxable when
                        transferred.

                                         -51-
<pb n="174" />

                                XIII. INSURANCE TAXES

                The Insurance Tax in Delaware is based on gross premiums

          recei ved. The overwhelming majority of premiums are taxed at

          a rate of 1.75%.

                A significant portion of the 1.75% tax goes to help fund

          fire companies, and that portion is determined each year by the

          amount of premiums paid for fire and related insurance.

                Premiums for workmens' compensation insurance are taxed at

          a rate of 4%, while profits from marine insurance.are taxed at

          5%.

                The tax is due March I each year, and is collected and

          administered by the.Insurance Commission.

                                        -52-
<pb n="175" />

                                             vz9
                                                                           TAX DATAI

                                          T Ts:L@, w"
                          R 7 It 's
       160.00 -fo.00   -0.00   8V .00   16L.C0   '2410.OC V-10.00 4PO.00  400.00

                                  A?

                                                                              F-1

                                                                              C/3

   1-4                                          . ......
   2   ............. .........

    cl-

                      03  CV

                      (D  rt
                          pa

                      0

                      GQ

                      fb
                      GQ
<pb n="176" />

            Adjustments of Insurance Tax Data

                 Beginning in 1972, the Fire Tax was taken out of the 1.75%

            Insurance Tax receipts, rather than being collected separately.

            Therefore, each year beginning with 1973, an adjustment must be

            made to make up for the transfer of funds for this purpose.

                 Thus far, this transfer has been made as a lump sum in

            April, and amounted to $1,697,000 in 1973 and $1,780,000 in

            1974.  Adjustments were made to the data accordingly.

            DELAWARE CODE CHANGES    INSURANCE TAXES

            Effective
              Date                      Description of Change

            1-01-72     Fire tax now deducted from 1.75% tax   receipts and
                        transferred to a special fund instead of originally
                        going into the special fund. Tax is now paid by
                        all insurers, and not just fire insurers.

                                          -53-
<pb n="177" />

                                XIV. PUBLIC UTILITY TAX

                 The Delaware Public Utility Tax-is a tax placed on telephone,

            telegraph, gas, electricity, and cable television usage. Itlis

            imposed in addition to other taxes such  as license taxes, income

            taxes, and specialized gross receipts and privilege, taxes.

                 This tax in its present form was instituted in 1971, and has

            been criticized because of its regressive features; that is, it

            taxes essentials such as power for heating, cooking and lighting

            and as such, hits the. low incomed the hardest.

                 The.rate of,the tax is 5% of the total cost to the consumer.

            The tax on.telephone use is  expressly passed on.to the consumer

            and is noted as a tax on the bill as received  from  the telephone

            company. However, the taxes on telegraph, electricity, gas, and

            cable television are specifically written.into the Delaware Code

            to-be taxes on distributers and not on consumers, but another

            section of the Code allows regulated industries to change their

            rates so that changes in the tax will not affect their net

            receipts. Thus it appears that it is really_a direct 5% tax

            on consumption of these utilities, and that the tax incidence

            does indeed fall directly upon the consumer.

                 The tax is paid by the distributers to  the state.monthly, by

            the 15th of the following month. It is collected and administered

            by the Division 'of Revenue, Department of Finance.

                                          -54-
<pb n="178" />

                                                   V179

                                                                                      TAX DATA

                              RTUTI           ATUTI     JR1 0"
                                    220 - OC 16Jr CO   WILUO     240.00    ZW.00     _YD.00

                          rt

                    GQ
<pb n="179" />

           DELAWARE CODE CHANGES   PUBLIC UTILITY TAX

           Effective
             Date                     Description of Change

           8-01-71     Law into effect.

           7-01-73     Telephone use by the state and its political sub-
                       divisions exempted from the tax.

                                        -55-
<pb n="180" />

                                   XV. OTHER TAXES

                For convenience and due to their.size relative to revenue

           generating abilities, the remaining revenue sectors are.con-

           solidated into one category, OTHER TAXES. Obviously, since they

           are consol idated, there will be no list of code changes or

           adjustments to this series. In the future, if their size or

           economic significance warrants it, one or all of these series will

           be analyzed independently.  Presently, as set out in the monthly

           reports of the Department of Finance, they are as follows:

                a. Corporation Fees
                b. Motor Vehicle - Operator License Fee
                                 - Document Fees
                                 - Titling Fees
                                 - Reference Fees
                c. Dividend and Interest
                d. Hospital Board and Treatment
                e. Court Fines and Costs
                f. Motor Carrier Use
                g..Telephone and Telegraph
                h. Public Accommodation
                i. Gift
                j. Del. Tech. Tuition
                .k. All Other Revenue
                1. Non-Revenue

                As the graph shows, these sect ors.when lumped together are

           becoming more and more important as a revenue source and must

           be carefully considered when forecasting state revenues.

                                        -56-
<pb n="181" />

                                                                 v9s

                                                                                                              TAX DATA

                                                              -tie r      jn@
                                       R',l 2- TH                  H        tj
                                  40.001        @..Ot      &amp;I          W, 01                                 lf;0.00

                                                                                                          cn

                              CL    lb

                              0
<pb n="182" />

                                               PRELIMINARY ANALYSIS
                                                         OF DELAWARE         I
                                                       EMPLOYMENT IN
                                                           NINE MAJOR
                                                  INDUSTRIAL SECTORS

            by
            The Delaware Econometric Model.Group
<pb n="183" />

                            PRELIMINARY ANALYSIS OF DELAWARE E14PLOYIIENT

                                 IN NINE MAJOR INDUSTRIAL SECTORS

                                               by

                               The Delaware Econometric Model Group*

                                         September, 1974

              *Directors:
                  Dr. John H. Landon, Associate Professor of Economics
                  Dr. William R. Latham III, Assistant Professor of Economics
                  Dr. Kenneth A. Lewis, Associate Professor of Economics

              Manager
                  Gerald F. Hart

                               The preparation of this report was financed in
                       part through an Urban Planning Grant from the Department
                       of Housing and Urban Development under the provisions of
                       Section 701 of the Housing Act of 1954, as amended.

                               This report was prepared by the Delaware Econometric
                       Model Group under contract with the Delaware State Planning
                       Office.
<pb n="184" />

                                          ACKNOWLEDGEMENTS

                  The title page of this repo rt lists only the names of the directors

              and manager of the Delaware Econometric Model Group. The   list, of

              individuals who contributed essentially to the report is far more extensive.

              It includes all the students who have worked with us over the past nine

              months, the private businesses, agencies, and individuals who have been

              supportive of, our efforts to model the State's economy.

                  Especially deserving of mention are  David TruesdaleV vho collected

              and werifiedimuch of the data, John Lew  Silver, who ably accomplished

              computer.programming and analysis for us, and Kevin Dualeavy.and

              Michael Pilot, who developed the individual sectoral equations discussed

              in the report. We are also grateful to the State Planning Office for the

              financial support which made the research reported herein  possible.
<pb n="185" />

                                    TABLE OF CONTENTS

                                                                             Page

           INTRODUCTION   . . . . . . . . . . . . . . . . . . . . . . . .       1

           Section

             1.0 Analysis of Employment in Nine Major Sectors         . . . . 5

                1.1. Delaware Employment in'the Chemical Sector       . . . .10

                1.2 Delaware Employment in the Transportation
                      Equipment Sector   . . . . . . . . . . . . . . . . .   12

                1.3 Delaware Employment in the Other Manufacturing
                      Sector  . . . . . . . . . . . . . . . . . . . . . .    16

                1.4   Delaware Employment in the Agriculture Sector . .19

                1.5   Delaware Employment in the Construction Sector . .22

                1.6   Delaware Employment in the Federal Government
                      Sector  . . . . . . . . . . . . . . . . . . . . . .    25

                1.7   Delaware  Employment in  the  Services Sector   . . . .27

                1.8   Delaware  Employment in  the  Retail Trade Sector      .30

                1.9   Delaware  Employment in  the  Wholesale Trade
                      Sector .. . . . . . . . . . . . . .    . . . . . . . . 34

             2.0 Conclusion: Comments on the Dynamic Structure of
                  the Delaware Economy     . . . . . . . . . . . . . . . .   37
<pb n="186" />

                                      LIST OF GRAPHS

         Employment Sectors                                                 Page

              1.1  Delaware Employment in the    Chemical Sector         10A &amp; 10B

              1.2  Delaware Employment in the    Transportation
                   Equipment Sector   . . . . . . . . . . . . . . I      12A &amp; 15A

              1.3  Delaware Employment in the    Other Manufacturing
                   Sector  .. . . . . . . . . . . . .... . . . . . .  16A, 17A  &amp; 18A

              1.4  Delaware Employment in the    Agriculture
                   Sector  . . . . . . . . . . . . . . . . . . . . . ..      19A

              1.5  Delaware Employment   in the  Construction
                   Sect,or . . . . . . . . . . . . .. .. . . . . . . .. .    22A

              1.6@ Delaware Employment   in the  Federal Government
                   Sector  . . . . . . . . . . . . .                         25A

              1.7  Delaware Employment   in  the Services.Sector . . . 27A &amp; 27B

              1.8  Delaware Employment   in  the Retail Trade
                   .Sector . . . . . . . . . . . . ... . . ... . . .    30A &amp; 30B

              1.9  Delaware Employment   in  the Wholesale Trade
                   Sector  . . . . . . . . . . . . . . . . . . . . .         &amp; 34B
<pb n="187" />

                                     INTRODUCTION

              The objective of this report is to  examine the aggregate

         relationships between Delaware industries and the factors

         affecting them. Since this is a preliminary analysis, future

         reports will refine the comments and relationships identified

         herein.

              The industrial sectors considered in this report are highly

         aggregated. The whole Delaware economy is considered to consist

         of only nine sectors: chemicals, transportation equipment, other

         manufacturing., construction, agriculture, Federal government,

         services, retail trade and wholesale trade. This level    of

         aggregation is necessary in a preliminary analysis to identify

         the major factors contributing to variation in the economic

         activity of the'sectors.   In examining.less highly aggregated

         indust rial sectors, far more period-to-period variability would

         be present, thus masking  the underlying relationships causing

         that variability. It is   felt that by first examining aggregate

         relationships in which  less variability appears, the major factors

         influencing industries in the Delaware.economy can be identified.

         Future studies can then refine these factors to determine their

         impacts on less highly aggregated industries in the state.

              Many aggregate models of the United States economy specify

         that the summation of all activities, GNP, can  be divided into
<pb n="188" />

                                                                          2

         five major categories: (1) government spending for goods and

         services and investment, G; (2) business spending for new plant

         and equipment, 1; (3) household spending for goods and services,

         C; (4) spending by the three preceding agents for the products

         produced in other economies, M; and (5) spending by agents in

         other economies on the productg of agents in the U. S. economy,

         X.

              In equation form this can be expressed as:

                            GNP = C + I + G + X   M

              Sufficient data are not available to summarize economic

         activity.in the state of Delaware in the above categories.

         However, an alternative way of summarizing economic activities

         can be used which is very similar to the above method. In  this

         method economic activity is classified by industrial sector

         rather than by agent (where the term "industrial" means specific

         economic activities thus encompassing all economic activities

         in. the state including agriculture and retailing).

              In this report the aggregate industrial sectors examined are

         the chemical industry, the transportation equipment industry, the

         agricultural industry, and the summation of all other manufactur-

         ing industries. These four sectors together constitute the major

         exporting sectors of the Delaware economy and their activities

         correspond roughly to the X activities in the above equation.

         The sector which most closely corresponds to an investment sector
<pb n="189" />

                                                                            3

         is the state construction industry, another of the.industries

         considered in this study. Corresponding most closely to govern-

         ment activity at the national level are state industrial sectors

         designated as federal government, local government, and state

         government sectors. Only the former is dealt with in this study.

         Corresponding to consumption spending of households at the national

         level are three sectors in the Delaware economy: wholesaling,

         retailing, and services.

              Since quarterly output data are not   available by sector for

         the Delaware economy, employment is used   as a proxy f or sectoral

         economic activity in this report. It is    our future plan to

         estimate output and expend itures for each of the above sectors.

              Since Delaware is a relatively small economy,.other things

         being equal, it would be  expected that activity in the Delaware

         economy would follow closely activity in the national economy.

         There are, of course,  reasons why one would not expect this to

         be true in all cases.   If a major proportion of some industry's

         total U. S. employment  were in Delaware, then it would be

         expected that employment in this sector would be relatively

         independent of the  U. S. total. Therefore, one might consider

         the preceding statement regarding   an expected relationship

         between Delaware  industry and national industry to be a hypothesis

         that will be subjected to tests, sector by sector, in this study.

              In this report we examine only nine individual sectors, one

                    and identify empirically some of   the major   factors
         at a time,
<pb n="190" />

                                                                         4

        that explain variation in each sector's employment. Missing from

        this analysis are several more useful, quantitative measures such

        as the direct and indirect multipliers for each sector which

        account for the interrelationships among the sectors. The

        multipliers would show1how changes in any of the sectors ini-

        tially impact the Delaware economy and what the, ultimate effects

        would be after the initial impact has been transmitted through

        all the interrelated sectors. This more sophisticated type of

        analysis requires both the simlutaneous estimation and the

        systematic simulation that can be produced only with the aid of

        an advanced econometric model. Such a model is now being

        developed for the State of Delaware., The analysis of,this report

        represents preliminary work on necessary inputs to that econo-

        metric moedl,.pointing out some of the dynamic interrelationships

        found to be important in the Delaware state economy and indicat-

        ing how sectors interact in a sequential manner to lead to changes

        L
         npersonal income in Delaware.
<pb n="191" />

                                                                             5

                1.0 ANALYSIS OF EMPLOYMENT IN NINE MAJOR SECTORS

              We begin the analysis of employment by sector in the

         Delaware economy by concentrating on the export sectors which

         respond to changes in the level of national demand for particular

         products and in turn provide a driving force for the state

         economy. It will be seen.that the following four industrial

         sectors (chemical, t ransportation equipment, other manufacturing,

         and.agricu.1ture) all respond to changes in.the national demand

         for these products as indicated by changes in the national employ-

            t levels in these sectors. It will later be-seen that the

         response of state employment in these export   sectors in turn

         helps to provide the impetus for changes in the employment levels

         in the more locally-oriented  sectors of the state economy

         (.Services, retail trade, and wholesale trade).

              Before proceeding, we describe briefly the theoretical

         framework embodied in the following analysis. From a micro-

         economic point.of view the quantity,of labor employed in a

         particular sector as well as  the wage level can be    described

         with3'-n,.a supply and demand framework of the labor  market.. The

         demand for.labor as an-iniputinto the production   process is

         derived from the demand-for the final output produced by the

         labor. in this sense the demand for labor is affected by

         factors which influence  the level of demand for the product,
<pb n="192" />

                                                                            6

                                  cing; suc
         which the labor s produ'*         h factors include the level of

         personal income, the level  of GNP, the price level and, in some

         instances, may be proxied by national employment in the particulai

         sector. In addition, the quantity of labor demanded responds to

         the wage rate currently being offered. For example, if wages

         rise or are expected to rise,  producers can begin to substitute

         other factors-of-production such as land and capital equipment

         for labor. Of course, such substitution is not always possible

         and when possible generally takes a long period of time to be

         effected. Thus, the impact of changes in wage rates up   on the

         demand for employment can be assumed to take several    quarters

         if not years. It is the demand-for-labor equations described

         here, With certain mod ifications, which will be estimated and

         discussed in the following portions of the paper. Turning to the

         supply side of the labor market, it is assumed in the analysis

         below that the wage rate in the particular sector-within a

         quarter is determined by outside.and past forces and does not

         vary with,current levels of employment. Thus, for example,

         wages in the Delaware economy may be assumed, within a particular

         quarter, to be.dependent upon such factors as national wages in

         the particular sector, past changes in local labor market condi-

         tionsi.recent changes in union, contracts, etc. Thus   it is

         assumed that the supply curve  within a particular quarter is

         horizontal at the going wage.,
<pb n="193" />

                                                                          7

              The discussion of each sector below begins with a graph

         which compares Delaware employment with national employment in

         the sector since 1963 on a quarterly basis through the fourth
         quarter of 1972.1 There are thus forty separate observations on

         national employment and state employment in each sector to use

         for making the comparison. Care must be taken in interpreting

         the magnitudes in each graph, however. In order to compare

         easily variations in state employment with variations in national

         employment, many of the graphs have had the state magnitudes

         adjusted upward by a factor which ranges from zero to one hundred.

         Therefore, one must note carefully what the adjusting magnitude'

         is for each state series before comparing visually the absolute

         size of state employment to national employment in any sector.

         The factor by which each state employment series has been

         multiplied is clearly indicated on each graph.

              After examining the graphical relationship between state

         employment and national employment in each.sector, a statistical

         technique, multiple, least-squares regression analysis, is used

         to determine whether or not a significant proportion of the

         variationin state employment  can.be explained by variations in

         national employment in the sector. In those cases where this  is

              Additional data on state employment are available through
         the second quarter of 1973. The source of the employment data
         is the U. S. Labor Department publication, Employment and Wages.
         The additional state data was obtained from the.research division
         of the State Department of Labor.
<pb n="194" />

                                                                           8

        not true, or where national employment alone provides an incom-

        plete explanation, other factors are then examined to provide' a

        better explanation of variation in the state employment for each

        individual sector. Again, it must be emphasized that since this

        is a preliminary report, no final conclusions regarding the fac-

        tors, influencing each sector can be drawn at this time. However,
                                                                                     L
        it is interesting to note that the factors which have been identi-

        fied for most of the sectors explain a very high percentage of

        the variation in employment in the sector.

             In some cases the relationship specified may not represent

        intuitively appealing relationships. This may be due, in part,

        to,the fact that this study is embedded in a larger study which
        seeks to forecast the future level of state employment'in each

        of the sectors. For this reason, a conscious attempt has been

        made in some cases to use var iables which are related to each

        sector in a sequential rather than a simultaneous relationship

        so that one variable is a statistically reliable predictor of the

        other. For  example, it has been found  that employment in the

        state's wholesale industry during the current period is a very

        good predictor of  employment in the state's retail industry

        three periods in the future. Thus, wholesale employment lagged

        two periods is used to explain retail employment even though one

        would normally expect that wholesale employment would be a

        function of previous retail employment rather than the reverse

        relationship found. While a complete understanding.of why such a
<pb n="195" />

                                                                         9

         relationship would exist is not available at this time, it is

         felt that such a relationship probably can be explained when the

         Delawar e economy is more adequately understood. For the present,

         this relationship is used only because it provides the best

         prediction of retail employment. In other cases lagged values of

         variables are included for strong theoretical reasons, as when

         real personal income.is used to,explain the level of employment

         in the service industry.
<pb n="196" />

                                                                         10

         1.1 Delaware State Em2loyment in the Chemical Sector

             Roughly three-quarters  of the labor force in the chemical

        industry in Delaware is employed by  duPont, the.largest chemical

        company in the United States, specializing in industrial chemi-

        cals. Wilmington is the headquarters of duPont, Hercules, and

        formerly of Atlas. As a c  onsequence, roughly two-thirds of the

        total chemical employment is engaged in management And research.

        As evidenced in the plot of state employment in the chemical

        industry over time versus national employment in inorganic and

        industriaIchemicals, Delaware employment follows very closely

        the national employment level.

             Further evidence confirming this hypothesis is pr ovided by

        multiple regression analysis which indicates that the national

        employment level explains approximately ninety-two percent of

        variation in the state employment level. From further comparison

        of the graphs, it appears that Delaware. employment is at least

        as stable., if not more stable, than national employment. The

        two series tend,to.follow roughly the same pattern until recent

        years when a significant departure may have begun, although thete

        have not as yet been enough obsei@vations to determine whether

        or not this departure has any degree of permanency.

             Perhaps.because chemical employment in the state of Delaware

        is a significant portion-of national chemical employment, the
<pb n="197" />

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<pb n="199" />

          equation which provides the best explanation of variation in

          Delaware employment in the chemical industry includes, besides

          the constant term, only the single variable, national employment

          in the industrial and inorganic chemical industry.

                    SECHEM   -15639.5 + .1492 NECHEMI
                                        (18.65)

                     2
                    R     916 (Approximately 92% of the variations in
                               Delaware employment in the chemical sector
                               is explained by this equation)

                    SECHEM   Delaware employment in the chemical sector

                    NECHEMI   National employment in industrial and
                              inorganic chemicals

          To illustrate what this equation means in practical terms, let

          us consider a change in the level of national employment in the

          industrial and inorganic chemical industry from its present level

          to a level ten-thousand employees higher than at present. The

          coefficient .1492 in front of NECHEMI indicates that 1,492

          additional,employees would be expected in the chemical industry

          in Delaware in association with a 10,000-person increase in

          employment in industrial and inorganic chemicals at  thenational

          level resulting, perhaps, from a general increase in demand for

          the chemical products. The number (18.65) beneath   the regression

          coefficient indicates that this increase in Delaware  employment is

          indeed statistically significant. (The number is a t-value which

          can be considered to indicate significance when greater than 1.5.)

          The standard error of estimate of this equation is 650 or approxi-

          mately 2. 15 percent of the mean value of state employment in
<pb n="200" />

                                                                         12

         chemicals. This indicates., from a predictive basis, that the

         equation will predict state employment in chemistry with a degree

         of accuracy of approximately two percent.

         1.2 Delaware Employment in the Transportation Equipment Industry

              The employment graphs indicate that Delaware state employment

         in the transportation equipment sector is a fairly small percentage

         of the national total. (Note that the state employment graph

         at.the bottom of the figure has been multiplied by a factor of

         ten.) State employmen t in Delaware in this sector has trended

         upward at a fairly steady pace over the last fifteen years and

         appears to be slightly more stable when compared with the behavior

         of national employment in transportation equipment. A   significant

         amount of variation in the national series is due to strikes.

         For example, the strike in the fourth quarter of 1970 is clearly

         evidenced in the national series and,, upon close inspection, in

         the state employment series as well.  As a result, the multiple

         regression analysis which followshas  included a dummy   variable

         entitled "strike" to allo w for this particular phenomenon. As.'

         implied in the graph, the strikes before 1970 did not have as

         significant an effect upon state employment as the 1970 strike;

         the regression analysis confirms this hypothesis. Also as

         evidenced in both graphs there is a strong s easonal pattern in

         employment in this particular sector with employment falling
<pb n="201" />

                L2
                C@
                t

                0
                9

                          National Employment in Transportation Equipment
                                                    (10,000,S)

              7@

                             @4

                          State Employment in Transportation Equipment
                                                   (1,000ts)

                     L 3,                f-,         CZ3 C3      G7,C43      03.CO                       GO      711GO       72.CLI      n.00        71+ Ica
                                                                                 TIME
<pb n="202" />

                                                                                 13

         through the course of the model year, and bottoming during the

         model changeover occurring in the third quarter of each year.

               Most recently, state employment shows a leveling off

         since 1971. It appears that the plants in Newark and Boxwood

         Road had stabilized the level of.their employment despite a

         gradual increase in    employment at the national level over this

         same period. This     is probably the result of capacity constraints

         in combination with    the indivisibility of shifts in the industry.

               The regression   equation explains well the employment.in.the-

         transportation sector but does not behave as well as        chemicals,

         -since  only approximately 85 percent of'the variation      in state

         employment   is explained by the equation.

                     SETRAN    1375.0 + .8425 (SETRAN-1)-+ .0155 (POSNET)
                                         (10.50)              (4.96)
                              + .0164 (NEGNET)     1569.4 (STRIKE) + 616.1 (MODEL
                               (5.18)              (-2.99)              (2.85)

                      2
                     R     853  (Approximately   85% of variations in Delaware,
                                 employment in   transportation equipment sector
                                 is explained by this equation)

                     SETRAN    Delaware employment in the transportation
                               equipment sector
                     SETRAN-1  = Value of.SETRAN one quarter previously
                     POSNET =  Value of positive quarterly changes it national
                               employment in the transportation equipment
                               sector (0 when negative)
                     NEGNET    Value of negative quarterly changes in national
                               employment in the transportation equipment
                               sector (0 when positive)
                     STRIKE    Shift variable to account'for major      automobile
                               strike (= 1 for strike, 0 otherwise)
                     MODEL    Shift variable to account for model changeover
                              in the third quarter
<pb n="203" />

                                                                        14

         The standard error of estimate is approximately 500 which

         indicates that about five-and-a-half percent error in prediction

         of the employment level, again not as good.as the performance for

         the chemical industry.

             'Turning to a discussion of the variables,included in the

         regression analysis, the presence of SETRAN-,l in the equation

         indicates that current levels of employment in the transporta-

         tion industry are closely associated with employment in the

         preceding period. The  two variables POSNET and NEGNET indicate

         that-state employment responds positively and significantly to

         changes in the demand for transportation equipment at the

         national level as proxied by changes in national employment in

         the sector. The two variables are entered separately in the

         equation to test the hypothesis that positive movements in national

         employment. in the transportation. sector.and negative movements in

         national employment in the transportation.sector would have

        ,significantly different effects.on state employment in the

         transportation sector.  Because the two coefficients have

         approximately-the same magnitude, ..0155.versus .0166, this hypo-

         thesis is rejected. One interpretation of this result is that the

         state industry is equally susceptible to shocks from the national

         level in both the downward direction as well as,the upward direc-

         tion.
<pb n="204" />

                                                                                               15

                  Because.of the presence of          SETRAN-1, the     dynamic structure

           of the state,employment in the transportation                equipment sector is

           such that state employment responds to               changes   in national     demand

           conditions with a,lag distributed out over time.                   This lagged

           response to national changes, stretching.outover                   several   periods,

           adds to the difficulty in.trying to             explain changes in       state

           employment in the transportation            industry. Employment         in  the

           automobile plants       in Delaware,     is somewhat, difficult to explain

           for  several     additi,onal,reasons.       There,are'significant indivisi-

           bilities apparent       in  the   method,of,.production,       as for   example,

           when an   entire -,shi-f t' is., added   or 1&amp;@    off.   Furtherm,ore-, the

           ot;tput  is homogpneous,anld@the'mix         of   products   islalways      changing

           and.,it  never   seems to    be repeated.

                 A  final   graph fo
                                          the'trapp.pprtation      sector plots     the    actual

           level of    employment in,     transoortation versus        the'predicted       level

           As implied    by    the least   squ@  ares, regression   equation.      As   one can

           see, the least      squares    equation    explains     fairly  well   changes   in

           the-state employment level. More              importantly,     the   regression

           equatioaseems        to pick up the turning        points   in   state  employmen   t.

           This is particularly        heartening     in  view of the     fact  that    this

           sector has a particularly complex            dynamic.pattern       and  for other

           reasons is     difficult to model.
<pb n="205" />

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<pb n="206" />

                                                                          16

     ..1.3 Delaware   State Employment  in Other Manufacturing Industries.

            The plots  of state and national employment in,the other

                                   ector again,indicates that the Dela-
       manufacturing  industries s

       ware economyrepresents a    fairly small percentage of total

       national employment in the sector     (state employment has been

       magnified one-hundred times). Employment at both the state

       level and the national level have been gradually rising over
       @t ime, with the national level showing mo revariation.than the

       state level. With regard    to recent experience, both series

       indicate a  decline in employment in,.the  1&amp;st@quarters of 1970

       and the early quarters of 1971. over     the entire  period, employ-

       ment in Delaware in other manufacturingdoes seem,to      correspond

       fairly closely to employment at the national level, as expected-

       for export-oriented industries*. It should be noted at this

       point that   the re ason that all of the other manufacturing

       industries  have been aggregated togetherAs that no single

       industrial sectoil@-,b-2sides transportation equipment and

       chemicals, are  large enough to merit separate recognition in    a

       studyat   this level which attempts   to indicate the   general forces,

       responsible for  changes in state economic activity.

            The regression  equation confirms that employment    at the

       national@lev6l in  otheirman'ufacturing is indeed   a highly

       significant explanatory variable in the equation     for state employ-

       ment in other manufacturing.       Employ-
<pb n="207" />

                                                                                                                                               Z:  G   C           Z@O.ICCI            3 -70 .00
                                                                                                             ot:,@              LJ 6 L J

                    In  i

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<pb n="208" />

                                                                                  17

          ment in-other manufacturing responds to      variation in national

          demand factors as proxied by national sectoral employmenti Again

          the hypothesis   that these industries are.expprt oriented and

          linked to the national economy is confirmed.. However, variation.

          in the national   employment level   does not provide a complete.

          explanation of   state employment;   two additionalfactors appear to.

          be particularly    important.  First.is the seasonal variation in the,

          series and second.'is the   dynamic,struct,ure of the sector,    cap-

          tured  by the  lagged values  of  SEOMAN,

                     SEOMAN    934.9   +.6792 (SEOMAN-1)   + .2695  (SEOMAN-.2)
                                                              (1.95)
                                                 -CH) + 1705.3  (QUARTER 2)
                               + .0022@ (NEOMAN

                               + 887.1  (QUARTER 3)
                      2
                     R     .952 (Approximately 95%    of the variations in
                                Delaware employment in    other manufacturing.
                                is explained by'th.is equation)

                     SEOMAN= Delaware,    employment  in the other manufacturing
                               sector
                     SEOMAN-i- Value    of SEONAN i   quarters previously
                     NEOMAN-CH    Change in national    employment in other
                                  manufacturing from    previous to.present
                                  quarter
                     QUARTER i    Shift variable to    account for regular
                                  seasonal difference from omitted quarters
                                  in quarter i      1  in quarter.i and
                                  0 otherwise)

               Again the dynamic    structure  of the  state otb  er-manufacturing

          sector is such that    changes in national   demand conditions lead

          to changes in Delaware employment but not immediately. In

          addition, this   impact is felt over several quarters into       the
<pb n="209" />

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<pb n="210" />

                                                                                .18

         future, complicating    the problem of  explaining   state employment.

         These  factors combine   to provide,a very good explanation,of

         state- employment, with   approximately 95 percent    of the variation.

         in state employment account.ed    for.  The  standard,error..of.estimate

         forthis   equation is,420; thus,    the predictive accuracy of this

         patticu lar equation is about 1.4 percent.

               As a final  indication of the   quality  provided by,t he re-

         gression  equation,, the actual levels   of state:em,ployment-in.other

        ,manufacturing and the levels predicted by      the regression   equation

         have  been plotted. Again    the regression equation     picks up the

         turnit.ig,points in the series  very well..

               In an attempt to summarize behavior of the three      industrial

         sectors considered above, a separate regression-ana.lysis has been

         conducted to explain the total employment level summed over the

         three  sectors. Rather than    present-this-equation.,the    actual  and:

         predicted levels of employmenthavebeen plotted. As          can be  seen.

         in  th e figure, the regression 'line provides an    excellent exp lana-

         tion  of state employment   in the export-oriente,d manufacturing

         sectors particularly in    the most'recent years.
<pb n="211" />

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<pb n="212" />

                                                                          19

        1.4 Delaware State Employment in the    Agricultural Sector

              The last export-oriented sector  considered in this paper is

        the agricultural sector. Again the plot for state agricultural

        employment has been magnified by a.factor of one-hundred because

        .agriculture is not large vis a vis national agricultural employ-

        ment. It should be,mentioned at the outset that these employment

        figures represent only covered employment, i.e., employment

        covered by federal unemployment insurance compensation, and     that

        covered employment does not represent   a large percentage of   the

        employment in the agricultural industry. As a result, the

        employment data here are merely indicativeof a certain portion

        of the agricultural labor force and must be treated with some

        degree of caution. The figures indicate that employment has been

        rising both nationally and regionally, particularly since 1970

        where the upward trend seems to have accelerated at both the

        national and state level, with perhaps a greater increase in the

        national level. The rate of increase here.   is somewhat illusionary,

        however beacuse of the increases in coverage in the reported data..

        A second  feature of these particular series which delineate them,

        very clearly from the previous sectors considered is the strong

        degree of seasonality, expected in the agricultural industries.

        The series also,indicate a slight decline in state employment

        in the  1967-68 period.
<pb n="213" />

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<pb n="214" />

                                                                                20

               Again the regression equation indicates that.state-em      ployment

          responds positively to changes in the demand for agricultural

          products at the national level, as expected for an export-linked

          sector. This is reflected in the regression equation for the

          state agricultural sector which finds that state employment

          responds to changes in the wholesale price index for farm

          products. Thus with the rapid growth-of food prices and farm

          products in the recent past the levels of state and national

          covered employment have both increased.

                     SEAGR    -212.165 + 5.9229(FARMINDEX-2)       457.502(RELWAGE-4)
                                          (5.42)                    (-1.50)

                              + 110297.761(RELEMP-4)      75.2951(QUARTER 1)
                                  (3.79)                   (-2.17)

                              + 41.945(QUARTER 2) + 45.731(QUARTER 3)
                                (1.99)                 (2.25)
                     R2    .815 (Approximately 82% of the variation in
                                Delaware employment in agriculture sector is
                                explained by this equation)

                     SEAGR    Delaware employment in agriculture. sector
                     FARMINDEX-2    Value,of U. S. index of wholesale farm
                                    prices two quarters previously
                     RELWAGE-4    Ratio of Delaware wages in agriculture to
                                  Delaware wages in all sectors four quarters
                                 ,previously
                     RELEMP-4    Ratio of Delaware employment in agriculture
                                 to total state employment four quarters
                                 previously
                     QUARTER i    Shift variable to account for regular
                                  seasonal difference from omitted quarter
                                  in quarter i      1 in quarter i and 0
                                  otherwise)
<pb n="215" />

                                                                            21

               Also significant in the regression   equation is  the season-

          ality and the dynamic structure of the   employment sector. The

          regression equat ion includes the value  of state employment in

          agriculture lagged four quarters, which indicates that last

          year's employment during the same quarter is an important

          e"-planatory.variable of this quarter  s employment. As such

          there is a certain amount of inertia   in the state agricultural

          series and theresponse of conditions    in the state industry to

          changes in national demand factors are   distributed -out over

          future periods in time.

               Finally, one additional variable   which has not appeared in

          the above equations is the relative wage in.the agricultural

          sector. As might be expected, as wages rise in the agricultural

          sector, employment is reduced. When labor becomes more expen-

          sive, the equation implies that farmers apparently find alterna-

          tive ways of producing their produce, ways which involve less

          labor-intensive processes. This substitution of capital or land

          for labor is not unexpected in an industry like agriculture,,

          where the technology is such that such substitution is much

          easier than in the other sectors analyzed above. However, as

          expected and anticipated in the introduction the impact of wages

          on state employment occurs with a long lag, here over a period of

          one year and even longer. Thus    the substitution of inputs

          occurs only slowly, waiting for   management decisions  to be made
<pb n="216" />

                                                                              22

        and then put into effect.

        1.5 Delaware State Em2loyment in the Construction Industry

              The above discussion has.  considered the industrial sectors

        in the state economy, corresponding roughly with the major export-

        ing sectors  of the Delaware economy. Attention is now turned

        toward the construction industry, which most closely corresponds

        to an investment sector in the state economy. It might be

        reemphasized that in models of regional growth- it is the

        exporting sectors which provide.impetus for rapid growth in any

        economy, while the remaining sectors in the state's economy

        merely reflect the need for services, including the construction

        of capital facilities to permit the activities in the exporting

        sectors.

              The employment graphs indicate a slight trend in the con-

       .struction industry both at the national and state levels with a

        greater increase in the state level since 1970. Since the state

        employment  series has once again been magnified by      one-hundred,.

        it is not  so large relative to the national series     as appears on

        the graphs. There is some evidence here, however,       that activity

        in the state construction sector is somewhat independent of the

        national sector, particularly over the past few years. Also

        exem plified in the series is a strong seasonal trend much like

        the seasonality observed in the agricultural sector above. It

        is not,unexpected that   the low point in the seasonal swing occurs.

        in the first quarter of   the year. Over recent years it.appears
<pb n="217" />

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                                                                             23

         that the Delaware construction industry has been able to insulate

         itself somewhat from the strong seasonal trends that occurred

         in state employmentin the early-and middle '60's in@construction.

        -Thisis not true of   the national-industry which seems to be as

         susceptible  to seasonal changes in the late '60.'s and early

      .@.'70's as it  was in the middle and early '60's.

              Turning to the regression results for the     construction

         industry, the quality  of the explanation is less satisfactory

         than one would hope.   For example.., the.percentage explanation   in

         variation of the  state employment series provided by the equation

         is only approximately  82 percent. Second, the standard error      of

         estimate is large enough to indicate a prediction error of

     ...be tween four and five percent. In.ddditi    on, the specification

         does not meet certain theoretic  al standards, since, for.example,

         the coefficient for the average wage coefficient, REAWCONS, is

         positive, whereas micro-economic theory would indicate a

         negative relationship here. This must be interpreted as      a

         source of specification error in the equation, providing.a

         signal that additional  work need be done.
<pb n="219" />

                                                                          24

            ..SECONS   -13378.3,+ .0035(NECONS) + 17006.1(RELWAGE)

                   -957.8(QUARTER 2) + 517.4(QUARTER 3) + 646.3(QUARTER 4)

               2
              R     820 (Approximately 82% of the variation in Delaware
                   employment in construction sector is explained by this
                   equation

              SECONS- Delaware employment in construction   sector
              NECONS = National employment in construction  sector
              RELWAGE = Ratio of Delaware to national wage
              QUARTER i   Shift variable to account for regular seasonal
                          difference from omitted quarter in quarter i
                             1 in quarter i and 0 otherwise)

         Nevertheless, even though the specification has certain weak-

         nesses, the equationdoes predict fairly well. Thus this parti-

         cular specification was picked not because of its explanatory

         power, but rather because of its predictive power. The possibil-

         ity that such a situation could arise was mentioned in-the intro-

         duction. The equation does indicate the strong seasonal pattern

         observed in the employment figures above. In addition, and in

         spite of the fact that construction is not an export industry,

         there seems to be a strong relationship between national and

         state employment. This may be because capital markets in the

         United States are national rather than regional in.character, and

         construction projects in Delaware must compete on a national

         level for funds necessary to finance them. It   is to be expected,

         then, that local construction activity.will correspond fairly

         closely to activity at the national level,  given thedependence

         of both the state and national industr y on the national capital

         market.
<pb n="220" />

                                                                        25

             In future studies we plan to in clude directly into the model

        of the Delaware economy a model of the financial sector of the

        Delaware economy and its ties to  the national financial sector.

        This extension is really necessary to understand the behavior of

        the investment sectors of the state economy.

             Unlike some of the above equations, the  dynamic structure

        of the construction industry does not appear  to be particularly

        complex. However, it   should be noted that given the recent

        experience in national  capital markets the dynamic structure.of

        this particular sector may be changing; if this is so, past

        information become s less useful in predicting the future level of

        state construction.

        1.6 Delaware State Employment in   the Federal Government Sector

             The plot of state employment for federal  government employees

        has been magnified by one-hundred.times; thus,.it can be seen

        that the total employment in the federal government is1much greater

        in the other forty-nine states than  it is.in Delaware. It  3LS

        expected that state levels of federal government employment

        increase with national levels, as the effects of increased

        government employment filter down into, Delaware's share. The

        plots indicate a rapid increase in Delaware's,federal  government
        employment. from the first quarter of.1966 to the first quarter

        of 1968, an increase which also occurred at the national level.
<pb n="221" />

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                                                                           26

         over the past few years, while federal government   employment at

         the national level has tended to decline somewhat,   employment in

         Delaware has continued to rise, particularly.in-late@1972 and

         early 1973.

              The regression equ ation exp lains the state employment of

         federal employees fairly-well, with approximately 88 percent of
         the variation in'state employment being accou  nted for by the

         equation. First, the regression equation evidences a seasonal

         pattern in federal government employment   which is not so pro-

         nounced as in either the agricultural or   the manufacturing

         sectors above. Second,the level of state employment in the

         federal sector responds positively to changes in national employ-

         ment, reflecting the filtering down of federal jobs into Dela-

         ware alluded to above. The equation indicates, however, that.

         Delaware employment in this sector responds with a lag of almost

         one year to changes in national  federal government employment.

              SEFGV   9.1 + 3.000(GNP-2)  + .001(NEFGV-4)
                             (2.41)         (3.44)
                      -84.479(SAWFGV-2)  -26.731(QUARTER 1)
                                          (-,.43)
                        23.377(QUARTER 2) -45.920(QUARTER 3)
                          (.38)              (-.72)
               2-
              R     879 (Approximately 88% of variation. in Delaware employ-
                        ment in the federal government sector is explained
                        by this equation.)
              SEFGV ='Delaware employment in federal government sector
              GNP-2 = Gross national product two quarters previously
              NEFGV-4 = National employment in federal government sector
                        four quarters-previously
              SAWFGV-2   Delaware average wage in federal government sector
              QUARTER i   Shift variable to account for regular seasonal
                          difference from omitted quarter in quarter Li
                              1 in quarter i and 0 otherwise)
<pb n="223" />

                                                                         27

              Third,.state employment responds positively  to. changes in

         the level of gross national product with a lag of.two quarters,

         as federal expenditures are linked to the growth in national

         employment. Fourth, the@average wage in the federalgovernment

         sector enters negatively in the regression equation, although the

         statistical significance of this particular variable must be

         questioned. An increase, for example, in the average wage rate

         paid to federal government employees produces with a lag a

         decrease in the amount of employment in the state, federal-

         government sector.

              This preliminary report deals with only one of three

         government sectors (federal, state and local). In the future the

         analysis will be expanded to cover employment in both the state

         government sector and the local government sector (which together

         are quite large in Delaware)., Initial attempts at this investiga-

         tion have not been as encouraging as are those for the federal

         government sector, although work is continuing.

         1.7 Delaware State Employment in the Services Industries

              The discussion now turns to the consumption sectors of the

         Delaware state economy, including services, retail trade, and

         wholesale trade. These sectors,, referred to as the regional

         sectors of the Delawar e economy, play a responsive-role in the

         interactive structure of state industry. Regional Science
<pb n="224" />

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                                                                            28

         indicates that it is these sectors (or employment in these

         sectors) which responds to changes in the other, more export-

         oriented sectors of the state economy. In    this sense, it. is the

         export sectors which play the  role of  the driving force in the

         state economy, which in turn lead  to increased employment in the

         consumation sectors, as increased  demand.for retail productsand.

         services trickles down, with a lag, into increased jobs in the

         local and regional sectors. However, while these sectors may.be

         passive from this point of view, their importance   and contribu-

         tion to total state.employment  and to Delaware  personal income

         cannot-be minimized. The ability of the state's economy to

         sustain increased employment. in the export. sectors depends

         critically upon the locally-oriented sectors.

              State employment in the services industry   has been fairly

         stable the last ten years, exhibiting moderate   growth both at

         the national level and at the state level..in the  employment plots

         over time, with growth at the national level slightly higher

         than growth at the state level.   In both  instances, however, there

         appears to be a strong upward  jump in the early '70's, which in

         part reflects the increase in  the coverage of the employment

         statistics. A plot of employment in the state services sector,

         over time versus the level of  real Delaware personal income over

       .time has also been presented. Delaware    personal-income is.defined

         as the total wage bill  plus other sources of income which include
<pb n="227" />

                                                                          29

          certain transfers,.property income and proprietors' income, and

          real Delaware income is calculated by dividing the level of

          Delaware personal income by the consumer price index. Real

          income provides abetter indication of the actual purchasing

          power represented by the state income level. As can be seen in

          this plot, the state employment in the services sector does vary

          positively and consistently with the changes in Delaware personal

          income,, with some allowance made for differences in seasonal

          variation inherent with employment series.

               SESER   -819.537 + 1588.746(RDPY-2) -1678.305(QUARTER 1)
                                  (37.73)            (-8.18)
                       -240.258(QUARTER 2) -1361.018(QUARTER 4)
                        (-1.17)             (-6.83)

                2
               R     980 (Approximately 98% of variation in Delaware
                         employment in services sector is explained   by
                         this equation.)
               SESER = Delaware employment in services sector
               RDPY-2 = Real Delaw.are personal income two quarters previously
               QUARTER i = Shift variable to account forregular seasonal
                           difference from omitted quarter in quarter i
                              1 in quarter i and 0 otherwise)

               The regression equation confirms the close relationship

          between state employment.in services and real Delaware personal

          income. When Delaware personal income is included in the re-

          gression equation along with allowance for seasonal factors, 98

          percent of the variation in state service employment is explained

          by the equation, and the regression coefficients are all strongly

          significant. The dynamic structure of the equation is such that
<pb n="228" />

                                                                           30

         as state income rises (and Delaware residents have more income    to

         spend on services,and other it'ems), employment in the services

         industry increases, but with a lag of about two-quarters. @Thus,,

         i,t takes approximately six months for increased purchasing.power

         to betranslated into jobs in this particularsector..      As ex-,

         pected the seasonal pattern of the services industry is strong,

         dipping down in  both the first and fourth,quarters.

         1.8  Delaware State  Employment  in the Retail Trade Sector

              Again since the state employment in retail trade     has been-

         magnified by one-hundred in the   plot of national  and state  employ

        .ment data, Delaware employment   in this sector is  indeed a small

         percentage of total  national employment, as expected. Stat6,

         employment has a strong-positive upward   trend in  the retail

         trade sector, with a slight acceleration   of the trend  in the last

         few years. It appears that retail trade    is a strong and growing

         sector in  the state economy, particularly  duringthe early

         1970's-. Also evidenced by the graph is adegree of seasonality

         in retail trade, again not solstrong as for-agriculture or con-

         struction. We have also,plotted employment in the retail trade

         sector against real Delaware   personal income over time. This

         plot again indicates the.strong positive relationship between

         Delaware personal income and employment in retail trade     as

         expected for a regionally-,oriented, consumption sector
<pb n="229" />

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                                                                            31

          of the economy. In fact, state employment in retail trade is

          growing slightly more  rapidly, particularly in the last few

          years, than growth in  general level of-state economic activity

          as proxied by the state income series. Like the export sectors

          described above, the retail trade sector, then, is also con-

          tributing significant impetus to the increase in state income.

               Turning to the regression equation, the empirical model has

          been able to explain approximately 98 percent of the variation in

          state employment in retail trade, with A prediction error of

          approximately one percent. The factors used to explain state

          employment in this sector are three-fold. First, the strong

          seasonality in retail trade is evidenced by the regression

          equation. As would be   postulated, retail trade is lower during

          the,first quarter and higher during the third and fourth quarters.

               SERET    -10170.722 + .8913(SEWHL-2) + 19998.375(RDPY-2)
                                      (1.72)           (10.78)
                        -1212.857(QUARTER 1) + 231.335(QUARTER 3)
                         (-.381)                (0.73)
                       +483.645(QUARTER 4)
                         (1.50)
               R2    .97.8 (Approximately 98% of variation  in Delaware employ-
                          ment in retail  sector is explained by this equation.)
               SERET = Delaware employment in retail sector
               SEWHL-2 = Delaware employment in wholesale sector two quarters
                          previously
               RDPY-2.= Real Delaware personal income.two quarters previously
               QUARTER i    Shift variables to account for regular seasonal
                            difference from omitted quarter in quarter i
                               I in quarter i and 0 otherwise)
<pb n="232" />

                                                                           32

          Second, state employment in the retail  trade sector responds

          positively to changes in real Delaware  personal income but with

          a two-period lag as in the service sector. This implies that

          increases in Delaware personal income (and thus in the purchas-

          ing power) result in increased employment.in the state retail

          trade sector, but not immediately, since it takes approximately

          two quarters for the increase in demand for retail products to

          be reflected in increased employment to help provide the products

          to the public. A third factor responsible for the explanation

          of variation in the state level of state employment is an

          interesting phenomenon hot encountered above in the export,

          investment, or government sectors. Within the regional con-

          sumption sectors of the Delaware economy there is evidence of

          strong interaction effects. For example, state employment in

          retail trade responds positively but with a two-quarter lag to

          changes in the state's employment in the wholesale trades

          sector, establishing a direct linkage between these two regional
          sect ors.1 In this sense, employment in the wholesale trade

             iThe presence of this intera Iction effect greatly complicates
          the lag structure in the retail trade sector as well as in the
          state economy as a whole. As seen in the next section, state
          wholesale trade employment responds with a lag distributed out
          over time to changes in Delaware personal income. This change
          in turn affects retail trade employment with a lag of two quar-
          ters as noted iri the retail trade regression equation. Thu's the
          impact effect of a change in state income upon retail trade
          employment is felt directly with a two quarter Iag noted in the
          text above and indirectly with a lag distributed out over time
          as income changes lead to wholesale trade changes which then lead
<pb n="233" />

                                                                         33

        sector of economy is a leading indicator of employment in the

        retail trade sector. Thus activity which occurs in the whole-

        sale trade sector of the industry as goods are being distributed

        for sales at the retail level signals increased activity and,

        with a two quarter lag, employment at the retail level.

             The study of-the retail trade  sector is as yet incomplete.

        One very important phenomenon from  a public policy point of view

        is the role that sales taxes play  in determining the demand for

        retail products in Delaware and thus the need for employment   in

        this sector. The tax policy question encompasses not only the

        policy in Delaware but also the policies of Pennsylvania,

        Maryland, and New Jersey, since the presence or absence of taxes

        in adjoining states should have an impact upon the demand for

        retail goods and thus employment within the state of Delaware.

        To date we have not been able to quantify the amount of retail

        trade traffic which  crosses over state lines into Delaware be-

        cause, of sales tax differentials.and what Delaware might be

        expected to lose if the sales tax differentials were narrow   ed

        with a tax in Delaware. Again this is an area for further work

        and one for which more data need  be collected. Specifically,
        data need be collected concerning the level of retail sales

        to more retail trade changes. To calcula  te the final impact upon
        retail trade employment of a given percentage increase in state
        income requires the use of a dynamic simulation model and the.
        specification of all sectors of the'state econometric model.
        Since this capability is currently being developed, we will be
       .in a position tolanswer such questions in the ne-ar future..
<pb n="234" />

                                                                          34

         rather than employment in the state of  Delaware on  as dis-

         aggregated a level as possible.

         1.9 Delaware State Employment in the Wholesale Trade Sector

              State employment in the wholesale trade sector has increased

         along with national employment as evidenced in the employment

         plots, although state employment has not kept up with the

         increase in national employment. The.slight degree of season-

         ality in the series is more clearly evidenced in the national

         plots than in the state plots.   State employment in wholesale

         trade increased in almost a linear fashion from the first quarter

         of 1963 to the fourth quarter of 1968. Then it jumped suddenly

         in the first two quarters of 1969, leveled out during the third

         quarter of 1969 through the third quarter of 1971, jumped again

         in the last quarter of 1971, and then reasserted its linear

         growth pattern. Also plotted is the.level of Delaware state

         employment versus real Delaware personal income. As.in the

         retail sector, there is a strong relationship between these two

         series, with wholesale trade growing more rapidly than Delaware

         income. The wholesale trade sector, while it has no  t kept up

         with the national sector, still remains a strong source of

         growth in the Delaware economy.
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                                                                                  35

                SEWHL    -289.344 + .5276(SEWHL-2) + 251.787(RDPY-2)
                                      (3.48)             (2.97)
                         -863.5475(SAWWHL-2) + 423.353(SHIFT) + 40.052(QUARTER 1)
                           (-1.90                 (3.41)                (.44)
                         + 228.761(QUARTER 2) + 61.407 (QUARTER 3)
                            (2.06.)                (.67)

                 2
                R     .930 (Approximately 93% of variation in Delaware
                           employment in wholesale sector is explained       by
                           this equation.)
                SEWHL    Delaware employment in wholesale sector
                RDPY-2 = Real Delaware personal-income two quarters previously
                SEWHL-2 = Value of SEWHL two quarters previously
                SAWWRL = Delaware average wage in wholesale sector
                SHIFT = Shift variable to account for extension of coverage
                         in wholesale sector       0 before 1971.4 and 1 after)
                QUARTER  i    Shift variables to account for regular seasonal
                             difference from omitted quarter in quarter 1
                                 I in quarter i and 0 otherwise)

                The regression equation explains approximately 90 percent         of

          the variation in.state employment in wholesale trade. The explana-

          tion centers Around, first, seasonal factors which are not

          particularly strong for this sector, indicating that state employ-

          ment in wholesale trade is insulated from'the'seasonal changes

          evidenced, for example, in retail trade and services. Since

          employment in wholesale trade is one step removed from the final

          consumption process unlike services and retail trade, it is not

          too surprising that wholesale trade is less subject to seasonal

          factors. Second, the inertia exhibited in several of the above

          sectors is als  o present in wholesale trade, as lagged va.lues of

          wholesale employment provide a     significant.contribution to the

          explanation of variation in state      employment and past change in

          wholesale trade employment can be used, to some extent,,- to

          explain future changes in     employment..
<pb n="238" />

                                                                           36

               Third, real Delaware personal income influences wholesale

         trade, although.the impact of a change in state income upon.

         wholesaleemployment is not so great as in the retail sector

        .(about one-third as.great). Again, the wholesale sector,    one,

         step removed from the final consumption process, is more

         iso.lated,than retail trade from outside changes. Since the im-

         pact of changes in Delaware personal income occur   in state

         wholesale-trade employment with a.lag of two:,quarters, changes

         in the final-consumption decisions are   translated into changes

         in employment needs in whole,sale trade  only with a lag. More-

         over, the lag here is distributed out over,several   quarters in

         the future, given the above-described inertia in this sector.

         About one-half of t he change in empl-oyment occurs after two

         quarters, with the rest distributed out over time.

              Fourth, employment in the wholesale trade sector is respon-

         sive to changes in wages paid for these employees. As.evidenced

         by the regression equation, a rise in the average wage level

         leads to a fall in the level ofemployment with a lag of

         approximately two quarters. From a statistical point of view,

         this effect issignificant.

              Fifth, the final variable in the regression equationis a

         dummy variable to indicate the jump that   occurred in state

         employment and wholesale trade in the fourth quarter of 1971.

         We are still attempting to provide a better   explanation as to

         why this increase has occurred.
<pb n="239" />

                                                                            37

                2.0 CONCLUSION:   COMME NTS ON THE DYNAMIC STRUCTURE

                               OF THE DELAWARE ECONOMY

               Much of the  above material can be  summarized in a  useful

         fashion by   considering an ove.rview of the dynamic structure of.

         the Delaware state economy. An outline     of the dynamic structure

         of the economy,is  presented  in Figure  1. As shown in  Figure 1,.

         national variables  affect,  through the  regre.ssion models, sItate

         employment  in chemicals,  transportation equipment,other manu-

         facturing,  construction,  agriculture, and federal government.

         The national variables   include employment (in chemicals, trans-

         portation equipment, other manufacturing, construction and

         federal government), national prices (for agricultural product6),

         and national GNP (which affects federal government.employment).

         These flows are shown'in the left-hand portion of Figure 1. It'

         should be noted that the impact.of changes in the national

         variables is felt on the state variables with a lag, often of

         several quarters and often distributed out over time.

              At the same time,.as seen in the upper right-hand side of

         Figure 1, national wage levels affect state wa   ge levels again,

         perhaps, with a lag distributed out over time. These, in turn,

         through the regression models,   affect  the afore-mentioned   six

         sectors of state employment.

               Continuing down the  table, state  employment,in the six
<pb n="240" />

                                                                                38

                                          FIGURE  I

             Elements of the   Dynamic  Structur6'.of:the Delaware    Economy

                                 Chemicals
          National               Transportation
             Employment in       Other Manufacturing        National  Wage Levels
                                 Construction
                               .1ederal Government
                               +
          National Prices in   jAgriculture Employment.     State-Wage  Levels,
                               4-
          National GNP in.     lFederal Government.,              'Via the-multi.ple.
                                    Employment                     regre,s,sion models
                                                                  :(with a lag
                                 via the multiple                   distributed out-
                                 regression models                ..,-over time)

                                 Chemicals.
                                 Tarf8pottation
                                 T
          State Employment in    Other Manufacturing
                                                                             S
           (with lags,           Construction
            distributed   out    Agriculture                                 R
            over time)           Federal Government
                                                                             0
                                 via the state total                         N
                                                                             G
                                      wage bill

                                                                             S
                    Delaware Personal Income
                                 via changes in   the general                'A
                                                                             S
                                        price level                          0
                                                                             N
                  Real Delaware  Personal. Income
                                                                             A
                                 via the multiple
                                 regression models
                             S   01                                          T
                                                                             Y
          State Employment       Retail Trade-4,
          in Locally-            Wholesale Trade,      P time alg
          oriented Sectors     IServices.*

                                 via cha nges in  the total
                                        wage bill
                                 Of
                    Delaware ersonal Income
<pb n="241" />

                                                                               39

         export-government-investment oriented sectorsaffects         Delaware

         personal income, since Delaware personal.income includes the

         total state wage bill. Changes in the general price        level then

         affect real Delaware personal income, which,.via the       regre'ssion

         models,  influence state employment in the regionally-oriented

         se ctors of the Delaware   state economy  illustrating.the primary

         multiplier process., These sectors includexetail trade., services,

         and wholesale trade. Note that -changes in employment in whole'.

         .sale trade.in turn affect employment in retail trade      with a lag

         distributed out overtime. These changes      in state employment,.

         again affect real   Delawarepersonal income since real Delaware

         personal income includes the state wage bill.

              At the bottom of the table, an upward arrow indicates that

        .as the state employment in theregionally-oriented.sectors

         reaffect.Delaware personal-income,, which.   in turn further influ-_

         ences the  state employment in these regional sectors through

         secondary and tertiary multipliers.. Elements of strong season-

         ality occur throughout the above     process as indicated   on,the far.

         right-hand side of Figure l..

              Quickly summarizing,    changes  in.nationalvariables affect

         the Delaware state economy through     certain key sectors: chemicals$

         transportation equipment,    other manufacturing, construction,

         agricultural.and federal government,      These%changes, then, lead

         to further changes in the    regionally-and-locally-oriented sectors
<pb n="242" />

                                                                             40

         of the Delaware economy:   retail trade, services, and wholesale

         trade. This whole process is complex and takes time as the ef-

         fects  of change in national  employment, prices, GNP, wage     levels,

         etc., filterdown through the different sectors of the Delaware
                                                                                         L
         economy with a sometimes long lag distributed out.over several.

         quarters.

               The dynamic  structure viewed here lies   at the very heart  of

         the  general forecasting problem involved in    predicting employ-
                                                                                         J
         ment levels and.wage levels in the state of'Delaware. As we

         have  seen, changes in national variables which    do affect the,

         Delaware economy can be expected to have an influence distributed

         out over several quarters. Thus, occurrences today have been

         conditioned by changes in the general economic environment which
         have occurred in the past.' Untill.we understand the dynamic

         structure-of the economy, how these different sectors"feed back

         into each@other,  what the@time lags involved are, and how these

                  s'are changing over time, we will not be able to provide.
         time lag

         a forecasting vehicle which   will be  reliable. As. a preliminary

        .,report, this paperhas summarized some of the major-dynamic

         features of the Delaware economy.. It remains now to gain a better

         understanding of these dynamic factors, to extend the explanation

         to additional sectors and to   include some of the excluded

         conditions alluded to in the   discussion of the individual

         sectors'above.
<pb n="243" />

                                               APPENDIX E
<pb n="244" />

                                   DELAWARE TOMORROW COMMISSION MINUTES

                                              October 2, 1974

               ATTENDEES:

               Francis Biondi                                    Jane Tripp
               Clifford Hearn                                    Bruce Hudson
               Albert W. Madora                                  Joann D. Slights
               John F. Walton                                    Ted.Harvey
               James Miller                                      M. W. Krueger
               Ed O'Donnell                                      Craig Bickerton
               John W. Jardine, Jr.                              Peter E. Morrow
               Robert R. Jordan                                  Joe Conaway
               Ross E. Anderson, Jr.                             Virginia Joy
               Russell W. Thibeault                              William Cohen
               Merna Hurd                                        Arthur Kreiger
               William B. Keene                                  Thomas Maloney
               John J. Ryan                                      Patricia C. Schramm
               Stephen Chamberlin                                Henry Topel
               Leon Weiner                                       Fred Krapf
               Richard M. Bauer                                  Roland Derrickson
               Richard B. Hardesty, Sr.                          Joseph H. Wyke
               Clifford T. Foster                                Eric P. Sennhenn
               James H. Gilliam, Jr.                             J. Taylor Buckley, Jr.
               John E. Malarkey                                  Eric Brucker
               Robert J. Berndt                                  Wm. Bradford
               Crawford J. Carroll                               Kurt Christensen
               Jack T. Roe                                       William C. Henry
               Henry Folsom                                      J. Thomas Schrank
               Arthur Wilson                                     Spencer Thompson
               W. L. Fritz, Jr.                                  Ernest W. Ryan
               Wm. A. Elgie, Jr.                                 George Worrilow
               Raymond H. Malenfant                              John C. Bryson
               William Markell                                   Peter A. Larson
               John Curran                                       R. W. O'Brien
               Dorothy W. Greer                                  John Daniello
               Henry J. Ridgely                                  David Hugg, III
               Jane B. Aughey                                    David Keifer
               N. C. Vasuki                                      Robert MacPherson
<pb n="245" />

                                                                                 Page 1

                      BIONDI: Good  afternoon ladies and gentlemen, my name is Frank Biondi,.

               I am the chair man of the Commission an d I have just tried to sheda little

               light in here by opening the drapes. I don't want    to  be accused right off,

               of keeping anybody in the dark. -My duty   at this time, my sole duty at

               this time is to call this meeting to order and introduce to You the

               Governor of the State of Delaware, Sherman Tribbitt.

                      TRIBBITT: Thank you very much Frank, first of all    I want to say

               good afternoon toyou ladies and gentlemen.

                      I want to cordiallywelcome all of you to this important first meeting

               of the Delaware Tomorrow Commission at historic Buena Vista.

                      As you probably can see by the large group of people hereassembled,

               I have indeed invited a number of.individuals who have agreed to assist    the

               Commission, as members of its various working committees.

                      In addition, a sizeable group of State, county,  and  municipal planning

               officials are here to serve the Commission in a technical    capacity.

                      As you well know, I have ap pointed Francis Biondi as  Chairman of the

               Commission.

                      Shortly, I will be turning this meeting over to the Chairman, but

               before doing so, I  would like to make just a few personal comments and

               observations.

                      The Delaware Tomorrow Commission was created by Executive Order Number

               48 in  June of this,year and subse quently amended by Executive Order Number

               53, and just today I made one other change in it, I donl,t know whether

               these have been passed out. Executive Order 56 makes    a change or two in
<pb n="246" />

                                                                              PrE  2

              the original two executive orders.

                    I believe, I hope, you have.copies of these two orders as well as

              the third copy.

                    i4ow, why do we have.a Delaware Tomorrow Comihission? Why do we need iT?

              What is its mandate? Who are its members? Ho   w will it function? What

              kind of additional support will it require? In answer to the first question,

              why the Delaware Tomorrow Commission and why do we  ne ed it?

                    Delaware's strategic geographical location, immediately adjacent

              to the Boston-to-Richmond Growth Belt., poses profound questions concerning

              the State's future growth.

                    The ever-intensifying debate regarding the co-existence of increased

              industrial and other development, and the preservation of the State's

              rich environmental resources, continues to be waged.

                    Chairman Biondi, who last month attended a seminar sponsored by the

                              laware on the "Dimensions of Delaware Development", assures
              University of De

              me that this debate is far from resolved, especially in the absence  of a

              Statewide growth policy.

                    The potential for offshore petroleum operations, and the significant

              r
                 'fications of the U.S. vs. Maine decision are complex factors that will
               ami

              bring heavy pressures to bear on future State growth  policy decisions.

                    The State must examine these and other important considerations now,

              or we will be caught, at the hour of decision, without rational policies

              or pians upon which to base our actions.

                    Time is of the essence.

                    We must strive now to examine the direction of Delaware's growth.
<pb n="247" />

                                                                                Page 3

                     Is the course charted, one which can provide  a decent   job for every

               Delawarean. Can it  provide sufficient revenues for the State and its

               political subdivisions to effectively function... and at the same time,

               preserve and enhance our cherished  natural resources, like the beaches,

               the wetlands, the quality of our air and water?

                     We must look at development policy  concerning industrial, commercial,

               and residential development including open space, recreation and transportation.

                     We must look at our effectiveness or lack of effectiveness in.

               attracting desirable job piwducink industry-Ao-our- State-

                     The mandate, then, of the Delaware, Tomorrow Commission  is to examine

               these and other issues, and.to develop a coherent,  balanced strategy for

               future growth.

                     The Commission is made up of representatives from public and private

               organizations, sharing a wide range of interests.

                     hopefully, each and every member of the Com mission will participate

               with the single-minded purpose of  contributing their knowledge towards  an

               end product which will benefit all  Delawareans.

                     How will the Commission function?

                     The Commission can only function effectively if each  member of  the

               commission, its various subcommittees and technical advisors, will participate

               to the fullest extent possible.

                     The State, meaning the State government, cannot   possibly do an

               effective job without the support and commitment of all of you   here today.

                     Chairman Biondi will be working closely with you, aware   of the fact,

               that your dedicated support of the concept of  theDelaware Tomorrow

               Commission is the first crucial step in turning the idea into   a practical

               program to be implemented.
<pb n="248" />

                                                                                   Page 4

                      I urge your support, and I hope that your efforts will highlight

               the kind of close cooperation by the different levels of government which

               is so necessary in a small State such    as ours.

                      If we fail to work together, to   plan together, then indeed we shall L;

               unable to grow together.

                      Two hundred years ago, a handful of men met in Philadelphia to forge

               what was to become the greatest "growth strategy" that man has ever known.

                      Representatives from our State actively and significantly participated

               at these meetings. Now, on the eve of the two-hundredth anniversary of this

               occasion, let us, along with the thousands of Delawareans who will sub-

               sequently share in this planning process, dedicate ourselves to assuring

               that Delaware Tomorrow will be a State that all its ditizens can be proud of.

                      Before.. I- tiirm-,-tthia.,tipodium_ overr-,lo, Mr.-Biondi,@ I and I see you Mayor

               here,  and I hope that you have received your copy of the Port of Wilmington

               Study  Committee,-I hope you have!-sir, and I am in receipt of it and I have

               simply issued a press release here giving some substance of it. The

               copies of it were made availableto     the people assembled here.

                      BIONDI: We have twenty copies of it.

                      GOVERNOR: Twebty copies I am told and the Port of Wilmington Study

               Committee chaired by   Mr. C. B. McCoy wa. s created by Executive Order back

               in February and it has been somewhat of a joint participation, not somewhat,

               it has indeed been'a   joint participation on  the part  of the administration

               of the city, county,   and State government.   I think.that perhaps what's here,

               and I simply make it   available because of the significance of the Delaware

               Tomorrow Commission   today and byreason   of be ing a reciprocant of this,
<pb n="249" />

                                                                                Page 5

               make it available to those because I think   it's,.if it's not a full brother

               or sister, it probably certainly is a first cousin.

                     Secondly, I would like to announce for your information   in addition

               to the Gather Committee Report, study report of the year to Lodine Gather,
  Iff
               I forget the exact name of the committee at that time that he chaired.

               The General Assembly, as I am sure a lot of   you know, did indeed pass Senate

               Bill 257 with it's several amendments. The   prime sponsor I believe was

               SenatorBerndt. I had not until now appointed that committee to establish

               a Delaware Deep Water Oil Terminal Committee and thatl.s what the act

               basically does. When it got through with it's many amendments it was

               amended to the extent that there was no public,funds created in that   act

               for that committee to work with, but it is indeed a lawful committee   and

               I signed that piece of legislation. I   want to announce today that I  have

               appointed to that committee in compliance with  the act itself, Senator Berndt

               to be the chairman, the required four members  of the General Assembly of

               the two political parties Senator Berndt, Senator Zimmerman, Representative

               Knox, Representative Matushefske,.- J. Madison Nelson is a New Castle County

               member and some people may or may not, that are here, may be learning about

               this, maybe my office hasn't been able to be in contact with you. We    are only

               hoping you will accept. Arthur Wilson is a New   Castle County member,  Mrs.

               B. Blades Derrickson is a Kent County member along with Lt. Governor

               Bookhammer and Mr. Vincent Brittingham our Sussex County member and the two

               environmentalists are Mr. Gene Trumbore, and Mr. Wm. S. Ingran Jr. In a

               further step the College of Marine Sciences  was requir ed to appoint three

               people and they had that prerogativeand the names submitted to me by the
<pb n="250" />

                                                                             Pacre 6

              College of Marine Sciences are Dr. Robert S. Biggs, Joe M. Boodman, Dr. Gerald

              J. Magone, if I am pronouncing that correctly. I only make that announce-

              ment because at this point I had not yet nominated that committee and it

              will certainly have some relationship as far as I am concerned with the

              Delaware Tomorrow Commission by reason of the very nature of it's creation

              having to do with an oil terminal in an off-shore oil ter minal. Now, Francis

              I am about to turn this conference over to you, I want you to be mindful

              of the fact that I am not giving you an easy job, but I know that given

              the kind of people gathered here this afternoon, that I am not giving

              you an impossible job.

                    I would hope that your interest would continue after today. If we

              have named anybody to the Delaware Tomorrow Commission at toiday's meeting

              who does not feel the significance of it then feel free to so state your,

              wetve nominated you, we've named you and we want you to serve,,but we don't

              want you to serve if you think that it's of no value or that your interest

              is lacking because with the interest lacking we can't serve a purpose that

              we want to deal with. I feel confident that Chairman Biondi will know who's

              attending, he has been very active about that kind of thing with the Delaware

              Agency to Reduce Crime and the people who won't participate, Frank says he

              can't use you. I would imagine you would feel the same way in this kind of

              a venture with the Delaware Tomorrow Commission. I want to thank you personal-

              ly, each and everyone of you, for taking your time to be here. I'm looking

              as Governor, I am looking for a contribution here that will be meaningful

              not to this administration but sincerely to the people of the State of

              Delaware, that's the sole purpose.

                   Thank you very much.
<pb n="251" />

                                                                                Page 7

                     BIONDI: Thank you Governor. For    the record I guess we ought to make

               .it clear that you did give me.this job, you didn't ask me if I'd like   to

               have it. As I recall the conversation,    I received a telephone call from

               your counsel, Mr. Carey, saying "Are you interested, in growth in the State?
               I said yes and I went home that night and my wife said "I" just got A call

               from Mr. Carey. He said to tell you you've been, since you're interested, you've

               been appointed.Chairman of the Commission. I asked him if he would like to

               speak to you but he said no." Here I am today. The Governor has stated

               broadly the purposes of the Delaware Tomorrow Commission,   I'd like tobriefly

               outline some of its more specific.responsibilit.ies and there are five as

               we see them at this time. They are the following:

                     First of all to determine what the State government's    historical.
                     experience has been in regard to growth.

                     Second, to determine..how effectively State government  is currently
                     responding to growth.

                     Third, to determine alternative ways that the.State government can
                     provide for effective growth.

                     Fourth, to evaluate the potential impact of various growth alternatives
                     in the private and the public sector.

                     Fifth, to recommend to State government, policies and strategies for
                     effective and rational growth in the residential', commercial, and
                     industrial:area.

                     In addition to the purposes as outlined by the Governor and    these

               specific responsibilities as I have outlined them now    there is a broader

               purpose also which is involved in the first two, which is to be served by    this

               Commission if it serves any purpose. And that is to raise the level of

              @public.discussion in.this State with respect to the problems of growth,

               to raise the level of public discussion by indepth study of the problems.

                   .-Governor-Ttibbitt mentioned that there  was a conference  at the

               University of Delaware on September 12 which  I attended, and very frankly,
<pb n="252" />

                                                                          Page 8

              the conference in my judgment could have been held two years ago and the

              statements made wouldn't have been any di fferent. It did not appear to me,

              although eve;-yone was citing the News Journal articles .. as the basis for

              the discussion, that too much attention had been paid to some of the factual

              problems which have been raised - the lack of data, the lack of information,

              the lack of fattual judgments which could be agreed upon by varying parties

              with respect to fundamental issues.. There is a problem and there has

              been a problem in the public affairs of this State as I have seen it for a

              while, and that is we sometimes rush to judgment without the same kind of

              analysis that we would give in private affairs to questions. This has happened

              in connection with recommendations with respect to taxes and other policies

              in the State. I think that if the Commission is going to serve a useful role

              one of the fundamental things we oughtto do is look at the facts, look at

              the problems and try to arrive at judgments with respect to those problems

              that reasonable men, given their varying interests, will recognize as

              factually supported.

                   Now, as an idea of the kind of problems we ought to look  at, two members

              of this Commission have indicated areas of interest which they  would suggest

              for the Commission. I am not saying that these should be the   areas of

              interest for the Commission specifically. It seems to me that the kind of

              questions the Commission is going to have to address itself to.

                   Mr. Thompson, Spencer Thompson of ICI, was kind enough  to look at the

              Commission's charge and to suggest that, in view of his experience with

              the Greater Wilmington Development Council, there are three broad questions

              @that we ought to look at:
<pb n="253" />

                                                                             Page 9

                     (1)  What  changes in the work force of Delaware should be anticipated.
                          and planned for in the next ten to fifteen.years? What changes
                          will  come about as a result of population growth and migration?
                          Whateffects of more education, what affects on attitude towards
                          work?
                     (2)  What changes should be expected in job a  'vailability? Will there
                          be an accurate growth in a number of job opportunities with
                          the existing businesses in the State? If new industry is needed
                          in order to provide job opportunities-for projected changes in
                          work force, what kinds of industry are needed? Where should the
                          new enterprises be located?
                     (3)  What is the climate of the State in terms of it's appeal   to the
                          kinds of new industry which should be attracted to Delaware?
                          (having first made the judgment as to.what kind of industry we
                          need in the State and what changes in that climate are needed).
                          Related to this question, are there serious taxation or fiscal
                          problems in the State? Whatis relative quality of governmental
                          services in Delaware as they affect potential new employers?
                          What is the quality of other essential ingredients for new
                          business in Delaware; land resources, water resources, labor
                          resources,.etc? What do our leading banks and business institutions
                          in the State think about the climate?

                     These are the broad questions that Spencer has posed as matters which

                are the proper business of the Commission. Another member    of the Commission,

                Mr. Vaughn, Jerry Vaughn, who is coordinator for Community   and Resource Develop-

                ment, the Delaware Cooperative Extension Service, University of Delaware,

                College of Agricultural Services, who also served as Chairman on the State's

                Council of Industrial Financing,  has voiced some relevant issues. In a

                recent letter to Governor Tribbitt, after discussing the tax problem in the

                State, dtated; "reserving judgment on the  tax question, I f6el undue emphasis

                on it and amending the Coastal Zone  Act diverts,ourattention    from,other,

                much more important needs in strengthening Delaware's economy. As I     see

                it our needs are'in order of priority:

                     (1)  A plan for continuation of Delawarets threatened rail service,   or
                          development of,acceptable alternative transportation.
                     (2)  Expansion of Wilmington's port.
                     (3)  Massive publicity stressing Delaware wants new business and
                          industry; that we have a well-trained, highly productive labor
                          force and excellent schools and training facilities, and that the
                          Coastal Zone Act limits only certain types of industry.
                     (4)  An industrial development policy and funds  for the State to launch
<pb n="254" />

                                                                                  Page 10

                           a substantial program and selective recruitment       of desirable
                           target industries.

                      (5)  A plan for meeting long term energy needs of Delaware business
                           and industry.

                      (6)  Streamlining the exceedingly cumbersome and time-consuming zoning
                           and other permit procedures of some jurisdictions.

                      (7)  Great improvement in water, sewer, and housing in.industrial
                           parks.

                      (8)  Assembly of a larger and more varied inventory of prime industrial
                           sites with zoning, utilities, owners willing to sell or lease,
                           ready in advance, an industrial land bank.

                      (9)  Funds for 'Tantas type" industrial surveys showing specific
                           improvement needed in each community to attract industry.

                     (10)  Less conservative lending to business and industry by Delaware banks.

                     (11)  More  eventual capital for stafting new companies.

                     (12)  Change in anti-industry and anti-tourism      attitudes in some
                           communities.

                     (13)  Prevention of detrimental loss of serviee at the Greater Wilmington
                           Airport, and the final recommendation,

                     014)  Possible modification of our taxes to encourage       new business
                           and industry.

                      Well, I think both   of these gentlemen have put their     fingers on a

                series of problems which    we ought to address in this Commission.

                      Generally, I think what we are looking for is the answer to the conclusion

                which was reached in the News Journal series of articles published this

                past year, where, after talking about the tax      problem, the writers concluded,

                           Tractually Delaware's growth seems more hamstrung      by first, official
                           indecision over whether the State would benefit from further
                           growth, and beyond that, whether we want white collar or blue
                           collar workers to locate in the State. Next, failure to promote
                           the State or to advertise it's advantages. Next, an unwillingness
                           to commit the necessary funds to embark upon a serious campaign
<pb n="255" />

                                                                            Page 11

                          to attract new business. Next, a lack of coordination Among
                          governmental agencies in processing cases involving firmus
                          which are interested in locating in Delaware- Finally,
                          a benign attitude on the part of business and industry
                          already in the State in connection with efforts to lure new,
                          employers. These in addition, of course, to the squabble
                          over the Coastal Zone as it has been described in-the past."

                     If there is anyone standing, I think there. are some additional seats

                in the room here. Would you like to move in? Okay, I see Tom Maloney sitting

                in the corner there.

                    .Now, in attempting to approach a problem this.broad, there are serious

                problems as I look at it. The prittary conclusion the Commission might

                reach is that the problem's too broad'to attack. In.any-event, it.'s like

                any other problem.

                     When I start out in negotiations with Tom Ma&amp;oney  for the police or

                the fire fighters I've got a list of fifty demands  of what I want in the

                contract. He's got a list of fifty things he wants   to.take out of the

                contract, and we both think it's hopeless at the beginning but as we move

                on the specifics of the proposals one and two and start hammering them

                out either one of two things happens and this is what I think will happen

                here. If reason, moderation, and good judgment prevail,@ either men of good

                will agree on common facts and arrive at solutions or power prevails  and.

                the solution is in a different direction. In any event we.are going   to come

                to some conclusion about this problem, and I think that we ought to,  rather
                than worr@ about how broad the problem  is, really start hacking away at it.,

                Perhaps we'll come up with some solutions.

                     Now, let's talk about who's here in the room for a.minute. We have,

                first of all, members of the Delaware Tomorrow Commission in the room
<pb n="256" />

                                                                            Pagp@@12L

                                                   s of the Commission w
               and these are the thirty-one member                       ho represent

               a broad spectrum of public.officials and persons from the private sector.

               Secondly, there are people in.the room who are members of the three

               committees of the Commission and the committees are the Committee on

               Economic Development, the Committee  on Land Use and Community Development,

                                                         mm
               and three, the Cost of Public Services Co ittee. Now, the first thing

               that we ought to explain is perhaps, why these committees?

                    When I looked at the list of Commission members, and the list when I,

               looked at it was twenty-seven - twenty-eight and now it is, thirty-one, it

               was evident that all the people in the State who had expertise, who had

               experience, and who have something to say and something to contr  ibute about

               these problems could not be placed on a single commission. Secondlj, it

               was obvious that the Commission itself was top heavy with State officials

               and although the State officials reportedly 1 ike to give themselves advice,

               the advice they often get in those circumstancesis n9t-the best.

                    Next, we felt that a Commission of this kind operating with twenty-five

               to thirty members might result in a percentage of the thirty people,

               fifteen or twentyT maybe twenty-five of.the thirty people getting

               together, listening to arguments, old arguments, as they have in the past

               and as all the committees in the past have.done in this State without any

               ,indepth work being done by the committee and all we are going @o get fr om

               that is a summation of what the past arguments have been and I believe we

               could
                     all sit down and do that  at the present.time.

                    In an effort to broaden the base of-the Commission, to get people

               active in the process who weren't on the Commission  andtb channel the   work

               of the Commission, it was decided to create three committees, as I have said

               the Land Use and Community Development Committee, the Economic Development
<pb n="257" />

                                                                                     Page 13

                 Committee, and the  Cost of   Public Services Committee. Now at this point we

                 are nGt married to  this committee   structure, we  hardly  are even engaged to

                 it. We want the Commission to consider whether      or not  the structure which

                 has been suggested is the proper structure for proceeding.

                       So we have with us today members of the Commission,     members of the

                 three committees who are not members of the Commission, then we have a

                 Technical Advisory Committeepresent. The Technical Advisory Committee

                 consists of Mr. Keifer, the Chairman, of the Delaware State Planning Office;

                 Mr. Elgie, Planning Director for Department of Highways and'Transportation;

                 Mr. Daniello, Community Affairs and Economic Development;     Mr. Vasuki, Director,

                 Division of Natural Resources and    Environmental Control;  Mr. Bauer,  Director

                 of the New Castle County Planning    Department; Mrs. Hurd,  Director,  Office

                 of Water and Sewer, New Castle County; Mr. Peter Morrow,     Director,   Depart-

                 ment of Commerce,.City of Wilmington; Mrs. 'Schramm, Director of Planning, City

                 of.Wilmington; Mr. Marshall, City Manager of Newark; Mr. Cohen, Planner,

                 City of Newark; mr. 0 1 D@onnell,,, Director of WILMAPCO; Mr. O'Brien, Director,

                 Kent County Planning and Zoning Department; Mr. Fritz, Kent County Engineer;

                 Mr. henry the  Sussex County Engineer; Mr.   Derrickson, the Director of Planning

                 in thatcounty; Jack Roe,    the. Acting Planner of Dover; Mr. Hardesty, the

                 City Manager of Laurel.; and Dr. Jordan,, The State Geologist.

                       That's the membership of the Technical    Advisory  Committee. Now,,

                 why this Technical Advisory Committee? Well, first. of all, this group       I've.

                 just named, they constitute and represent the support staff for action

                 that'is going on-in the cities and in the counties of this State with

                 respect to questions of residential,.commercial, and industrial growth. They

                 are the people working at.the policy level in     the local 'subdivisions and I

                 believe that there can not be a meaningful State policy.with respect      to
<pb n="258" />

                                                                            Page 14

               residential, commercial, and industrial growth, unless it is coordinated

               with the programs, policies, and actions which are taking place at local

               level s in the State structure   We are a small State, come right down to

               it we are almost a small ne ighborhood by comparison with other states, but

               there is a plethora of jurisdictions and it is my conclusion that to proceed

               with a Commission of this kind to try to develop State policies without

               the participation and the input of these policy makers on the local level

               is just to waste time.

                    As an example of the need in this area I have cited in the previous

               meeting, I am not go ing to do it in any detail, Mr. Daniello, the Depart-

               ment of Economic Development Secretary has a Fantas study going on.which.

               is supposed to look at the kinds of industry which might be interested in

               locating in the State. Mrs.   Hurd in her office in New Castle County, which

               is part of Mr. Madora's office, has a 208 plan and she receives $1.2 million

               I think she has more money than any of us from the feds - she has an

               industrial growth study going on for New Castle County as a part of that

               plan. I noticed in the press that Mr. Slawik has a conference scheduled

               on growth problems and I know that Mr. Folsom, the president of the council,

               has a growth committee over all for New Castle County. Now, somewhere

               we ought to try to put this all together and get the data, the experience,

               the knowledge, and the policies, the plans, and the programs together in.

               one place. If  we are going to have some kind of a consistent policy

               in the State at all, it would have to be consistent with what is going

               on locally, and in order to be consistent, or in order to influence

               a local policy or vice versa we first of all have to have all the facts on

               the table. As I like to say, I like to play with a full deck. Now, all
<pb n="259" />

                                                                               Page 15

                of these people have agreed to cooperate. -One meeting has     been held and I

                know some of them have raised a question of what really do     you want from

                us? I tried to articulate it at the last meeting. I can       perhaps sum it   up

                a little  better at this point. Initially what we want from the Technical

                Advisory  Committee is the following:

                     First,aaniinventory of all plans and    planning studies  previously done
                     at their levels which are relevant to the work of this Commission.

                     Secondly, an inventory of all    the studies relevant to  the work of
                     this Commission that are in process - I don't.believe     that John
                     baniello ought to be hiding from the County what's going on in the
                     Fantas Study and I don't think the County ought     to be reticent about
                     letting the State know what's going on in their     study.

                     Third, we need an evaluation by these people      of the significance of
                     these past and present studies. In addition       we need an identification
                     of the ordinances, resolutions, rules, and policies atthe various,
                     levels of government which support, and which impact on growth, both
                     residential, commercial, and industrial, and we need their assistance
                     for the committees.

                     Now, I think each of   you has received a little pamphlet of    this kind.

                Do you each have that? Now, first thing you have in that pamphlet is the

                members ofthe Delaware Tomorrow Commission, following that, and that

                occupies one, two, three,   four pages  and by looking at these first four

                pages you can see who the   members of  the Commi ssion are, who the Governor's

                appointments  Are, who the'legislative   appointees are, and can familiarize

                yourself with  your fellow members.    On the.fourth page it is indicated

                that Clifford  Hearn, Esquire is going   to serve as'secretary to   the

                Commission.   I would also advise you   at this time that Rodman Ward, Esquire

                of the firm of Prickett, Ward, Burt,    and Sanders has agre@ed to  serve as counsel

                to the Commission and will be working    with me, and the primary   reason for.

                that is, he's the guy that recommended,to Carey    that he recommend   to Tribbitt
<pb n="260" />

                                                                           Page

              that I be Chairman. That he should get off for nothing is intolerable.

                    Rod has a great interest in this area and I am sure that he will be

              very helpful. Now, following those lists of the members of the Delaware

              Tomorrow Commission, you find the members of the committees - the Land

              Use and Community Development Committee who are not members of the Commission,

              the members ofthe Cost of Public Services Committee who are not members

              of the Commission, members of the Economic Development Committee who are

              not members of the Commission. The final page is an addendum which indicates

              three additions to the Cost of Public Services Committee: Dr. Markell of

              .the University, Dr. Brucker of the University, Mr. Madora who is the

              Director of Public Works for New Castle County. There also are indisated

              three members of the State Planning Office.    One person for each committee

              will be nomi nated from the State Planning Office. Mr. Hugg of the State

              Planning Office will work with the Land Use and Community Development

              Committee, Mr. Hudson will work with theEconomic Development Committee,

              Mr. Fisfis will work with the Cost of Public Services Committee. These

              committee assignments are coincidental with their areas of knowledge and

              expertise in the State Planning Office.

                   Now, going back to the front page of the Delaware Tomorrow Commission,

              persons and organizations, named by the Executive Orders 48 and 53, all the

              members of the Commission are,assigned to one of the three committees and

              the committees will consist of the members whose names appear as committee

              members who  are not Commission members and the following  members of the

              committees. Now if you want,to take your pens, I'll go through the list

              of the tentative assignments and we say tentative assignments of the members

              of the Commission, the committees, because if any member of the Commission

              feels he can serve more valuably on another committee that that to which   he
<pb n="261" />

                                                                                    Page 17

                .has been assigneA9 ihii's@'tine. Abd' also. ir @ou@ have rec.om'mendation-'@s" wiffi
                respect";i6 other pe6pld'f6r the c     i  t"i
                                                   6mm't ees.themselves I'll be willing to hear     those.
                      Starting  with the  persons, organizations, named by Executive Order.,

                No.'s 48 and 53,  and I'll just use the last names here so we can move on:

                Mr. Stewart, Cost  of Public Services;,Mrs. Tripp, Cost of Public Services;

                Dr. Worrilow, Cost  of Public Services; it will be Mr. Larson     for Mr. duPont,

                'Land Use and Conmunity..Development;,Miss  Greer, Economic Development;

                Mr. Davis, Cost of Public Services; Mr.    Campanilli or his delegate,    Cost

                of Public Services; Mr. Ryan,-Economic    Development;.Mr. Slawik, Land    Use

                and Community Development; Mayor Malone, Economic Development; Mr. Daniello,

                Economic Development; Mr. Schrank, Economic Development; Mr.     Hall, Land Use

                and Community Development; Mr. Hill, Land Use and Community      Development;

                Mr. Adams, Economic Development.; Mayor Carroll,.Land Use and,Community

                Development; Mr. Twilley, Land Use and Community Development; Mr.       Keifer,

                Cost of Public Services; Mr. Bryson,.Economic Development; Mr. Ziman,

                Land Use and Community Development. Turning to the      next page, Gubernatorial

                -Appointments; Mr. Walton, Economic Development; Mr. Krapf, Economic Ddvelop-

                ment; Mr. McCoy, Economic Development;, Mr. Folsom,    Cost of Public Services;

                Mr. Gilliam, Land Use and Community Development; Mrs. Slights, Land Use

                and Community Development; Mr. Weiner, Cost of Public Services; you may

                want to switch that last one. Where is Leon?, Okay, the.     legislative

                appointees; Senator Cordrey, Land Use and Community Development; Senator

                Berndt, Cost  of Public Services. Right.   off let me..make two-switches:   Mr.@

                Weiner to Land.Use and Community Develgpment,.I've had the benefit in       the

                past of his erudition on   this subject, and Senator Berndt to the Economic

                Development Committee; Senator, is that satisfactory with you?

                    ..@BERNDT: Fine.
<pb n="262" />

                                                                              P a

                     BIONDI: Representative Seibel to the.Cost of Public Services; Repr&amp;--

               sentative Kenneth W. Boulden, to balance these committees, the Cost Of

               Public Services. Okay, does anyone have any questions as to what sub-

               committee he is tentatively scheduled towork with? Okay. Now, let.me at

               this time just give you a general overview of the functions of these three

               subcommittees.

                    First of all, thi-s i-%,Just%-pte@l@imizat-y,-.-!i-nWe-want@ the

               themselves to stake-out their areas of interest, their areas of concern. The

               purpose of appointing people to these subcommittees who have expertise,

               who have experience, who have learning with respect to these problems

               the benefit of that learning and we expect the subcommittees to meet and

               discuss at length the problems that they will tackle individually. Pre-

               liminarily the Land Use and Community Development Committee should really

               deal with the geographical distribution of development throughout the State.

               Particularly, what amount and type of development is likely to occur in the

               various areas of the Stata" What amount and type of development is desired

               in'the various areas of the State? What public services and facilities are

               currently available to serve growth?. How much growth could be accommodated

               without additional services and/or facilities? What policies, if any, should

               be adopted with regard to resource areas, for example, aquifer:or'recharge

               areas? What are the relationships be tween official development policies and

               actual development? Economic Development.Committee should take a look at

               proposed growth goals with respect to population and employment, to propose

               growth targets, to review growth in the recent past. What is the impact

               of the tourism industry? What will be the impact of Outer Continental Shelf
<pb n="263" />

                                                                            Page 19

               development? What is   the potential of transportation advantage over the

               northern New Castle,   in northern New Castle County? Impact on the corridor

               area, the Penn Central  matters, Baltimore and Ohio railroadg, New Castle

               County airport? These   are real problems, and of course, the Wilmington  Port

               Study I believe should  become an integral part of the review of this

               committee. As in many   areas a lot of studies have been done. Let's take

               one area of taxation.   Well, we'll take that up later but let's  just talk

               about the Wilmington Port Study. I don't think there's any need for the

               committee to review in depth that problem., I think the committees should

               review the recent report and, if it agrees with that report, make it   a part

               of its recommendations. But we have to make use of studies that have     been

               done in the past. We just can't   let them sit around.

                    In the Cost of Public Services Committee there are a number of areas

               which have to be considered. You have to consider the public sector cost;

               the proposed types and levels of growth; the cost of government today;

               the aggregate public sector investment policy today;:State and local

               policies with respect to taxation including property assessments; structure

               of taxes in Delaware on a Statewide and local level; the State government

               debt policy; per capita cost for services that are  population related; user

               fees vs. general  tax revenues, and the,role of the  State government vs.

               local government in financing services, particularly in light   of the national

               policy in revenue sharing and block grants.

                    We're going to suggest that these committees meet bi-we,ekly,   if

               possible, from now until January of 1975. We would like the committees to

               meet bi-weekly from now through January,.and we would like the committees,   and

               we'll discuss this later in the meeting, to hold public hearings, attempt

               to hold them  in the most meaningful fashion. I'm not going to suggest how

               the committees should proceed  but we would.ask you to take into consideration,
<pb n="264" />

              proceeding as some of the committees proceed on a federal level. advising

              people when the committees are going to meet,and asking people who would-desire

              to be heard to present their statements in advance so that they can be

              reviewed and studied and meanihgful questions asked at the meeting. Every-

              body will get a chance to put their arguments on the record. The arguments

              haven't changed much, the arguments are pretty well known. What we want

              to do is have some meaningful study and some meaningful work done here.

              We hope that if the committees may meet on a bi-weekly basis between now and

              January, the committees will then report to the Commission. The Commission

              starting in February and March should try to coordinate, summarize the findings

              and the recommendations of the committees. They should also form at that

              time a legislative committee to help prepare various proposals, draft

              legislation hased on policy recommendations of the Commission. We hope to

              issue a draft report in April, and conduct hearings with respect to the draft

              report at that 'tiineq- and at the present time we are looking forward to

              presenting a report in June of 1975,

              four of the Governorts Executive Order which provides that this Commission

              shall submit to the.Governor in a General Asse mbly by June 1, 1975 its

              findings and recommendations, the-fi-nal dttijj-*a_.as'f-to.@t'he date@ 7n-

              of submission of the Commission's findings shall rest with the Commission.

              I believe we are going to have to measure the date of our final submission

              by the quality of the work we do in the interim period and I'm cognizant

              of Bill Bradford's comment to me that if we just identify the problems by

              June of 1975 we'll have made a contribution. I'm not usually   optimistic, I

              am not optimistic now, but like when you are writing your brief, it may be

              one hundred fifty pages but the first page is the toughest to write.
<pb n="265" />

                                                                                Page 21

                 After that, they  start  fal ling.

                      Now,  there are two  other items on the agenda  this afternoon, and one

                 of which is the most, well perhaps they're of parallel importance. We've

                 talked about the organization of the Commission,    it's.committees,.the member-

                 ship, the reason for the committees, the reasons    for the Technical Advisory

                 Committee. We've talked about the designation of     the membership of the

                 committees. Welve'talked generally about the function of the working.

                 committees. I've stated we've talked; we haven't talked - I've talked

                 you've listened. There are two other items on the agenda which are going

                 to.be important. There has been prepared a documententitled,."A Survey

                 of Popular Attitudes Towards Public Affairs in Delaware" by the.Oliver

                 Quayle organization. The results of that poll have been put together in

                 the volume. We have a representative, I believe Mr. Lovell, of that

                 organization today, who is going to summarize their findings and each

                 of you will be            py of this report at   the conclusiongof thismeetin
                                 given a co                                                     9.

                 Is that not the case, Dave?

                      KEIFER: Yes.

                      BIONDI: Each   person will receive a copy   of the report at.the conclusion

                 of the meeting.

                      Basically the thought  here was to  find out, what are people thinking

                 about the State's problems  today. I d,on!t think   what they are.thlinking is

                 determinative. Our business should be as I see     the principle focus of this

                 Commission- what is the role of leadership; what should the people be

                 thinking; what should we be talking about as public officials? Now, that

                 this survey has.,been done, we're goingto have a presentation of.it,.

                 and following that we are going to have an.open discussion. The open
<pb n="266" />

                                                                             Page 2-2"

              discussion will concern anything that's on your mind, including the purpose

              of the Commission, the committees,.the organization, anything that is said,

              and the report on the survey of popular attitudes towards public affairs

              in Delaware and anything else that members of the Commission believe is

              relevant. Is Mr. Lovell here at this time?

                    LOVELL: Good afternoon. We've conducted two surveys for the State of

              Delaware, one was done in February, it was in person, five hundred respondents

              throughout the State. An example was not drawn initially to give a precise

              ,reproduction of the population distribution within the State, but rather

              was intentionally off balanced a little bit to provide sufficient number

              of respondents in each of the four areas of the State: The City of Wilmington,

              New Castle County outside of the city, Kent County, and Sussex County.

              There were one hundred interviews in Wilmington, one hundred in Kent, one

              hundred in Sussex, and two hundred in New Castle County outside of Wilmington.

              In order to obtain an accurate reflection of the Statewide population, those

              four groups of interviews were mathematically weighted on computer to their

              appropriate representation in the State. That makes New Castle County

              interviews, in terms of the figures we present,.represent, fifty-six percent

              of the adult population of the State. Those personal interviews lasted from

              forty-five minutes to seventy-five minutes with each respondent. The time

              varying mostly in terms of what the respondent had to say rather than how the

              interviewing was conducted. The interviews were conducted in mid-February.

              That's important because the attitudes of the public are influenced 'very

              significantly by what is being reported in the media, what's going on. If

              you'll recall in February, the energy crisis was one of the major issues.
<pb n="267" />

                                                                                     Page 23

                Gas lines, it was   during the actual field period that alternate day sales

                of gasoline was established in Delaware. There.werehot line information

                services established in Kent and Sussex County      during  that period. There

                were considerable   tension and even   some fights  reported  in,the news media at

                gas stations w ith  people trying to   buy gasoline. Naturally that situation

                was reflected in the data. There     is an  unusually high level of concern

                reflected about the energy crisis. We did, in addition to that original

                survey, follow-up interviews by telephone,with, original respondents in June.

                We-re@-contacted two hundred seventy,or about fifty percent of the original
                respo-ndents,-and reititerv'iew6d- them. We  asRe&amp;@zkany ofl-@ the asame  queit?Lenzubut

                we asked some new ones in addition to fill out some areas that werenit         too

                clear in the first survey to measure some additional      developments. That too,

                involves mathematical weighting on the computer to relate an,accurate cross

                section of the State population. You will get a copy       of,the report that has

                been prepared on the survey. I won't cover everything in it because there is

                considerable detail, particularly on the demographic analysis. Welve looked

                at the attitudes of the population by area, by race, by age, by income, by

                sex, by religion, by voter registration, you name it, we looked at it.

                There is a conside  rable amount of that   kind of  detail in here. I will

                concentrate on pointing out some of the highlights.

                      First of  all,   we did  an  initial evaluation of how the    people.of Delaware
                feel about the  State. What    kind'of a  place is it to live?    We asked   three

                questions:

                      U)    How does  the quality of   life in Delaware compare to four or
                            five years ago?

                      (2)   How does  it, I'm   sorry, what do you expect to   happen in the.next
                            four or five years? Will quality of life in Delaware improve or
                            grow worse?
<pb n="268" />

                                                                               Page 24

                    (3) How does the quality of life in Delaware compare to states that
                         you are familiar with?

                    Thirty-six percent of the population Statewide feels that life in

              Delaware has improved. Twenty-three percent said it was abo   ut the same.

              Thirty-seven percent said it had grown worse, four percent not sure, no

              opinion. In effect there are almost two equal groups. Thirty-six percent

              who feel the quality of life has improved, thirty-seven percent who feel it

              has gotten worse. The patterns vary by area to some extent,.particularly in

              Yilmin ton where the people feel@ the.queaity of47-lifeshoLs-grown-          the
                    9

              past four or five years. It is particularly blacks who feel that the quality

              of life has grown worse. §txty-two percent of the blacks with an opinion

                                          -now, than. cbmpiared. to.the past- In four _or- five years
              feel it s, think, it@; 6worse

              thirty-six percent think the.quality of life will be-even worse than it is today.

              Thirty-three percent thinki-it will be better. Similar patterns, blacks

                                                                                   n whites
              and residents of Wilmington ar e more inclined to be pessimistic tha

              or residents of other areas of the State. Particularly in Kent County there

              is a high level of optimism. More than half of those with an opinion feel

              that the quality of life will improve. As compares to other States, exactly

              half of the respondents Statewide think Delaware is a better place to live

              than.other states. Only ten percent think it is worse than.other states.

              The conclusion that we drew from this is that, first of all compared to

              other surveys that we have conducted in similar states, there is somewhat

              lower opinion of the State in terms of the past and expectations of the future.

              However, it's a moderate concern as witnessed by the fact that people do

              generally think triat the State will be improving. Now, I can't comment on

              the validity of that belief whether it is a reasonable beiief or not, but

              that's the way the people felt at a given point in February.
<pb n="269" />

                                                                                Page 25

               certainly, that's about  as high as Vve ever seen itin    this kind of a question.

               Need for higher wages four percent and scattered remarks   in the same area.

               The third problem; crime, drugs, and law enforcement volunteered by twenty-six

               percent. Most of it along the lines that we need stricter, tougher judges-,

               courts too lenient. We.need more police, need tougher laws, enforce the

               laws equally for all, stricter drug laws and enforcement.

                     Taxes.and spending was volunteered fourth in.priority by twenty-five per-

               cent. Taxes are too high nine percent, need more careful spending of taxes

               ten percent, more equitable tax stritcture neededt nine -percent.

                     Land usage and the environment was next. Fourteen percent mentioned.

               something in that area. This is on a volunteer basis    remember, five percent improve

               usage of land, better planning, stronger zoning, five   percent keep and enforce

               the Coastal Zone Act; four percent clean up the environment, stop pollution,,,

                     Education - concern in.that area volunteered by twelve percent, most

               of it a rather general improve the quality of education.

                     Race relations - something in that area volunteered by eleven percent,,

               unfortunately, most of it, nine percent, carrying anti-black connotations:

               get the black chiselers off welfare, eliminate school busing, reinstat@!

               separate but equal policies, no mixture  of races.

                     Concern about the problems of the  elderly, volunteered  by.,nine percent,

               most of it well scattered. Do more for   the elderly in general; raise social,

               security, hardly a State problem; lowertaxes for older people.

                     Other problems were mentioned by less than ten. percent including 'roads

               and highways, eight percent; more public transportation, seven percent.

               State government administration concerns about corruption and excess employees

               DY Six percent   welfare, five percent; health, five percent; parks and

               recreation, fourpercent; housing, four percent, moral climate, particularly
<pb n="270" />

                                                                               Page 26

                     We asked a consider able number of questions about problems, issues

               that may be of concern to people, we tried different techniques, from

               general to specific and from a Volunteered kind of approach to a multiple

               choice kind of approach. The first   question on the area of issues, we

               asked resid ents of Delaware to tell us what they perceive.to be the problems

               confronting the State. The problems they would like the State government to

               do something about. There was a wide range of problems volunteered as is

               customary with a question like this. One problem that was mentioned most

               frequently was the energy crisis, forty-five percent talked about that.

               I've already mentioned that we were in the midst of the energk ci-isis in

               February when this question was asked. We have seen on the telephone

               follow-up -survey in June among other questions a reduction in conc2rn

               about the en6rgy crisis, which is not surprising, but as of February the

               top issue was the energy crisis. They covered.  a lot of ground and specific

               kinds of toncern@ Tliie.yworried about the availability of gasoline, about the

               Possibility of rationing, the distribution of sale of gasoline, the cost of

               energy services, g4sollne, oil, electricity, coal.. . Some were worried about

                                                   a          deed a shortage or was it a
               the truth of the ene rgy shortage, w s there in

               scheme to get higher profits? The second most frequently   volunteered concern

               was in the area of bread and butter problems. Thirty-nine mentioned someth,'ng

               in that a2@ea. Specifics, the two major Ories w6re, the cost of food is too

               high, and the cost of living is too high. These are not perhaps problems that

               are readily accessible to S-tate action; but.nevertheless, those were the

               concerns and people do look to the  State government for some assistance or

               action in tnat area. In addition   to that, only eight percent mentioned  a

               need for more jobs or more industry. That in itself is not unusually low,
<pb n="271" />

                                                                                          Page 27

                 pornography, two percent.

                        Some general comments about these, first of all the level of concern

                 about the economy we have seen since that survey and other surveys is rising

                 steadily, Which will surprise no one       I'm sure. It.was volunteered by thirty-

                 nine percent in February and at that       time, that was fairly high, in our

                 experience   in other states.

                        In State issues we have not     seen much concern of that level. Crime,

                 drugs, and   law enforcement volunteered.by twenty-six       percent was at that time

                 a little bit lower than we usually find it in State           surveys, it is in our

                 experience, continued to decline in importance quickly in relation            to in-

                 creasing concern about the economy.       Taxes and spending,.volunteered       by

                 twenty-five percent, again that's not a.particularly          unusual one,   but it'sa

                 little bit lower than we've seen it in the past, there is further            information

                 we'll come to regarding each of these issues, I should point out.             We will

                 find further on taxes and spending      that there is    an unusual  ly,  or was at

                 least, an unusually low level of concern about the amount people           pay in,

                 taxes in this.State. We have some information that helps explain             that.

                        Land usage and the' environment, volunteered by fourteen percent,

                 that's fai3@ly high for a volunteered issue kind of concern. Most people

                 don't think inthose terms when they're asked to speak           off the top of   their

                 heads.

                        Educatioil,.tw6lve percent    is fairly   low, on the otherhand, we

                 frequently find it come up much      higherthan that.

                        Race relations,  is not unusual. Aid to the elderly,        on  a volunteer

                 @basis at least is not   unusually high but1there is further       ind ication  elsewhere

                 that there is a high    level about that.     T.here is some variation in concern
<pb n="272" />

                                                                              PaLl @ 28

              by area of the State, as it would be expected,, aside -from thd -energy Crisis

              which I don't think is worthy of a great deal of attention at this point is

              because of the change in the situation since then.

                    Economic concerns were particularly high in Kent County, fifty percen-

              speaking of those. They range from thirty-three percent to thirty-seven

              percent in other areas of the State.

                    Concern about crime, drugs, and law enforcement is particularly high

              in Sussex County forty-four percent vs. twenty-six percent Statewide, lowest

              in New Castle County outside of Wilmington. Interestingly, the concern     is

              not unusually high in Wilmington itself. We,will see shortly th   at there

              is.some indication that there*is a highlevel of concern indeed in Wilmington,

              not that the problem is that close to the top of their minds so that they

              think of it off hand when asked to recite the problems that they think are

              important, but when they are reminded of it, they are concerned about it.

                    Tax and spending is low. I've covered those already. In addition we

              handed response lists of thirty-four subjects, issues,,problems, we asked

              them first of all to rate the performance of the State government on each.

              The average for the thirty-four issues was, of those with an opinion, thirty-

              seven percent held a favorable opinion of the State's performance, sixty-

              three percent an unfavorable opinion. That's not unusual for a State govern-

              ment, not at all unusual. Obviously, the most important issues are the ones

              that are rated worse.

                    The public generally seems to  work along the lines of what have you

              done for me lately. If the service   or facility is in good shape, and they

              rate the State well, it is not important. If it's in bad shape and they are

              concerned about.it, it gets a high importance and a low rating of the issues

              after we asked them to rate the government, we asked them to pick the two, oi-
<pb n="273" />

                                                                                      Page 29

                 three from the list that they felt    were most important.

                       First on the list, cost of living inflation, forty percent selected it.

                 The cnange here, the energy crisis dropped     to second position, with only

                 twenty-four percent picking it as one of.the most important. We had forty-five

                 percent volunt6ering,the energy crisis, but when they were       reminded of

                 other problems, only twenty-four percent really considered       it one of the

                 top issues.

                       Third in importance, help    for older people, selected    by twenty-three

                 percent, unusually high.    It usually doesn't come anywhere     near the top ten,

                 we-1-1,1 take that back. It's usually around tenth in importance on a State

                 issue list.

                       Fourth, crime   in the streets,  selected a   relatively  low sixteen  per-

                 cent, drugs and narcotics selected by fourteen      percent. Unemployment    in-

                 creased in importance when we got to the list,      up to fourteen percent

                 selected it. That's the particular concern of       blacks and in Wilmington, as

                 might be expected.

                       Other problems, education thirteen     percent, public transportation

                 twelve percent,.efficiency in government     eleven percentj welfare programs

                 ten percent, taxes nine percent, again much lower than it usually is.         State

                 hospitals and.health care nine percent- Protecting Delaware.'s coastal        zone,

                 in the context of all these problems, only seven percent considered it        one

                 of the most important problems. Government spending, only six percent         are

                 concerned about that. housing six percent, significantly higher within         the

                 City of -@,-iiminZton, more on the order of thirty percent there. Everything

                 else is volunteered by five percent-or less, mostly less. Air and water

                 pollution, 1-ive percent. ClosinF tax loopholes, bringing in new industry

                 =our 7percent- regulatinc growt.-i and development within the    State, four.percent;
<pb n="274" />

              parks-and recreation, three percent.; protecting natural areas in Delaware,

              three percent; maintaining existing roads and.highways, three percent; aid

              for the cities, two percent', protecting consumers, two percent; getting

              Delaware's fair share of federal programs, two per6ent;-encouraging tourism

              in Delaware, one percent; building new roads and highways, one percent; farm

              problems, one percent; highway safety, one  percent. This gives an indication

              of what people, as of February, felt was important, and felt was not so

              important in terms of the broad'panorama of issues confronting the State.

                    The worse job rating given the  State is on the most important issue,

              inflation in the economy,  ninety-One percent of those with an opinion rated.

              the State unfavorably. I  think we'd  probably find the same thing if we

              went out and did it again only more concern about-it now. It's the number

              one issue these days in the nation.   Issues seem to work that way, for a while

              it will be energy crisis, and that's  pretty well subsided, so now it's the

              economy. But the State was also rated unfavorably on all of the issues

              of any great concern, except education. Education which fell.se;venth in

              importance,.voiunteered by thirteen percent, sixty-five percent of those

              with an opinion rated the State well on education. Everything else until

              we got down to relatively unimportant issues was rated  unfavorably. The

              other favorable ratings were on protecting Delaware's  coastal zone, sixty-

              three percent with an opinion had a favorable impression of State performance

              there, sixty percent favorable attitude in the area of parks and recreation,

              sixty-three:percent protecting natural areas in Delaware, sixty-two percent

              building roads and highways, sixty-nine percent highway safety.

                    These are things where the public generally feels the State has been

              doing a good job. There is, are some marginal ratings, fifty-two percent,

              on encourageing tourism; fifty-onqE@ percent maintaining existing roads and
<pb n="275" />

                                                                                      Page 31

                highways. We asked another, took.another fairly general         approach to the

                issues. Starting with a fairly basic question to try        and  get an idea of

                what people   feel as the ideal thbust in Delaware over     the  next few years. We

                handed them  a cardlisting four alternatives and asked.them to select the one

                that came closest to their own point of view. The four alternatives were:

                       (1) Improve, State services    and facilities, evenif it means a sub-
                            stantial tax increase.

                       (2)  This is a general, no    specific service or   facility mentioned   yet,
                            just in general.

                            Do you think over the    next four or five years the State should.
                            concentrate on improving State facilities..or services, eveit'if
                            it means a substantial tax    increase?

                            Maintaining facilities and    services as they   are even  if that
                            requires a substantial tax    increase.

                       (4)  Hold the line on taxes,    even if it means cutting somewhat on
                            State services and facilitieslor reduce State taxes even if it
                            means bL substantial cutback in State services and facilities.

                       Twelve percent indicated support for the idea of an all out,      effort to

                .improve services and facilitie  s even if it means a    substantial tax increase.

                An additional thirty-two percent indicated support       for maintaining  services

                and facilities as they are, even if it costs some more, not a great          deal
                more, in taxes. Thirty-ei ht percent want the line       .held on taxes,    the*
                                             9                                                 y

                felt that that was more    important in  general than   improving  any particular

                facility or service, and    eight percent indicated   support forthe idea of

                cutting back substantially on taxes, ten     percent  were not sure, or could

                not express an  opinion. When you remove     those undecided and look at just

                the respondents  with an opinion, they split almost.fifty-fifty between

                the maintaining  or  improving  services at the expense of a moderate or sub-

                stantial tax increase and holding.or cutting taxes. I don't say that this

                gives you any easy answers. You will find through here that ona number
<pb n="276" />

                                                                                Page 32

              of very important issues the population splits rather decisively, almost down

              the middle,

                    BIONDI: They   do that in elections too, don't they?

                    LOVELL: They   certainly do. In regarding this public opinion research I,

              we think it's very important, very valuable, it can give you some feeling

              of what the people are concerned about, but you can't make decisions simply

              based upon it. As it's already been said, sometimes the people aren't aware

              of what a certain program involves, what the details are, what the-impact

              of it would be. In addition, people change their opinions, many of these

              opinions expressed here  are not rigid; are not locked in, you are not stuck

              with them, you can affect them. But this will give you an.idea of where you

              will face resistance, what kinds of questions are likely to arouse     controversy,

              how you can deal with problems   in the public realm, how you can publicize your

              opinions, your recommendations., your approach. In this case, if you have

              to make a decision on this I don't know.what you would do; half wants you

              to cut or hold taxes and half wants you to improve services.

                    There are  differences by demography, the ones most likely to support

              the idea of improving  or at least maintaining-existing services and facilities

              are more likely, it varies somewhat and the de  tails are in the report, are

              more likely to be women than men; are more likely to be young,are move likel-

              to be college graduates; they are likely to be concerned and active in

              community affairs; they.are likely to be business, professional, or small

              business people; they are likely to be, or white collar workers; they are

              likely to be renters, city dwellers, those under five years in theState; they

              tend to be Wilmington residents to some extent, and to s   ome extent lower
<pb n="277" />

                                                                                     Page 33

                economic level,  lower  income.

                      The resistance to increase taxation is     more,like.ly to come  from men, those

                fifty and older; those with less education-,    those who are. not very conce  Irned

                or active in their own community's affairs;     blue collar;  retired and widowed;

                small town and rural residents; andlongest      term residents ofthe State, those

                who have been here twenty   years or longer.

                      Turning to specific   treatment of individual   issue.concerns, we've

                asked a series of questions about all kinds of-problems, most of which were

                covered in general in the data already    talked about.

                      Let's-talk first about the emergy-crisis. and    maybe we  can get that

                out of the way for the moment. In February, some      seventy-four,  -almost

                three out of four residents of the,State considered the energy       crisis at

                least somewhat serious. Actually     forty-four-percent went so far as to call

                it very serious. The concern fell     considerably by June,   but was.still high,

                sixty-seven percent called the energy crisis     at least somewhat serious.

                Concern did fall in the intervening six.months, particularly as gas became more

                available, but the evidence we obtained indicates that people simply did not

                forget the crisis as  soon as  they were able   to,get gas again. We asked

                for example, how much  each respondent was doing    to help conserve energy.

                In February eighty-four percent were doing    most  or all they could. In June,

                six months later, seventy-three percent still     said they-were  doing.all...,or

                most of what they could so that people still      regarded the energy crisis   as

                around, Just not so immediately compelling or     so much of a problem to them in

                their every day lives. Interestingly enough      as.of February a plurality

                felt t1lat there was noreal energy shortage.      Forty-six percent rejected the

                whole validity of the  energy  crisis,  that changed by June. By June, a

                majority offifty-three percent were     willing to admit thatat least there was
<pb n="278" />

                                                                                PaF , 34

              a real energy shortage. That helps explain why the drop in concern was not

              inore decisive than it was.

                     In terms of the other problems, the economy, that was the second most

              frequently volunteered issue and it's the first one on the selected list.

              We asked a series of questions. First of all about the State's economy.

              Over the next year or so, do you expect the economy of the State of Delaware

              to improve or become worse? There was a split, again,     but sixty-six percent,

              two thirds of the residents-expect the economy to grow    worse, as of February

              this was, they expected the economy to grow worse within the State. Only

              nineteen percent expected it to improve. When they turned to their own

              economic situation, however,they@     i.'a little bit more optimistic. Forty-three

              percent said.th at they personally, they and their family personally were not

              as well off as they were a year or two ago. Eighteen percent reported

              improvement in their own financial situation, thirty-eight percent reported

              little change. Blacks in particular expressed feeling that they have suffered

              in the last  year or two, fifty-one percent of those, I'm sorry, fifty-one

              percent of  the black residents with opinions stated that they were not as

              well.off in February as they had been a year ago. On the other hand, looking

              ahead a year or two, thirty-six percent expect to be worse off; nineteen

              percent, to be better off; and thirty-seven percent, little change. There's

              a plurality in both cases in other words, well close to a plurality, who

              is deeply concerned about the effect of the economic climate on their own

              personal lives. That is particularly true among blacks     except that blacks

              tend to be more optimistic about the future than whites. A lot of that, we

              asked them why they expressed the opinion they did, is just plain old optimism,

              particularly black respondents. Many of them volunteered that it can'    t get
<pb n="279" />

                                                                                    Page 35

                any worse    It is as  bad as it is going to get. So    I would,not take    that

                the fact  that blacks  are more likely than whites to   expect improvement as

                a verystrong indicator that that really will improve for them.-,

                      The reasons people attribute    in explaining  their expectations, if

                they expect improvement they tend to cite personal     things such as I'm changing

                jobs or I'm moving out of the State perhaps. Very      few offer.a basic reason,

               ..they are scattered reasonsand very personal for the most part. But.t.he people

                who expect things to be worse for them take.a different tac, they,tend to

                blame government in one way or another,     on situations beyond their control;

              ,.inflation, cost of living. There is     some concern,  that's inflation, cost:of

                living is the primary reason people who.expect to     be worse off in a.year

                or two to see that. Another forty-three percent,      I'm sorry,.I'd better not

                even mention these figures because    it would take me half an hour to explain

                them.  There is some concern about    wages,but that's not the   major issue.

                The major  issue is cost of  living  inflation.

                      When  we turn to the question of   job opportunities in Delaware we asked

                now Job opportunities in   Delaware  compared to job  opportunities in.other

                states  they are familiar  with. Forty-one percent    say that job opportunities

                are better  in Delaware;  thirty-percent say they are about the same; only

                seventeen percent felt.that job opportunities were worse in Delaware than

                elsewhere. There is    a  difference, particularly between blacks and whites,

                again. Thirty-two percent of the     blacks say job opportunities in    Delaware

                are worse.tban they are elsewhere.     It's also,true in Wilmington.

                      I've  got to get  this organized. Okay, with regard to specific      services

                and dollar  priorities. -The basic question; we asked people,to choose between
<pb n="280" />

                                                                                   Page 36

               improving State service,,§'in general at the expense of a substantial tax

               increase. We asked that same question     about each of about ten or twelve

               specific areas of interest. The first     one, help for older people. Eighty-

               five percent of those with an opinion felt that help for older people must

               at least be maintained, even if it costs a littlemorie in taxes. Forty-nine

               percent of those with an opinion went so far as to say substantial improve-

               ment is needed, even ifItcosts substantially more in taxes. Fighting

               the energy crisis was also given a high priority of additional expenditures,

               forty-eight percent'. mass transit, f iftY-one -%percent ofrtbose with;--..

               opinions said mass transit must be improved even if it costs substantially more;

               another twenty-six percent said at least maintain it. Law-enforcement,

               courts, and prisons, ranked fourth in terms'of priority on the list with

               about three out of four calling for at least    maintaining current efforts    in

               that area. Schools and education only fell fifth, that's as we've already seen

               on a volunteered issue, it was unusually low volunteered concern about

               education but there's a fairly high commitment to use of t4X money to support

               it. Thirty-five percent want more spent in this area or at least want

               the service improved, forty-one percent in addition think it must be

               maintained even if it does cost a little more in taxes. We did not, by

               the way, specify what kind of taxation or, even what level of taxation in

               each question. Education in the State,'as'I understand      it, plays a very.

               strong role in education here, but a lot of it comes from direct property

               taxes.           ng the environment also came up fairly strong.support for
                       Protecti

               tax expenditures. Thirty-eight said maintain efforts.in this area, even if

               it costs a little m ore. Another twenty-eight percent want substantial

               increases.  housing, twenty-five percent improve housing even,if.-it.costs

               substantially more and thirty-five, maintain current efforts. A totalof

               sixty percent of those with opinions are concerned about housing there.
<pb n="281" />

                                                                                 Page 37

                Improving and maintaining highways, considerably less important. Fifty-

                nine percent of those with an opinion want it at least maintained but very

                few of those, only thirteen pencent, call for substantial improvement.

                Attracting new industry, fifty-six percent want efforts at least maintained,

                with twenty-seven percent wanting substantial.improvement. Building      new

                highways, fairly low priority in comparison. Welfare, low priority,     the majority

                there wants to hold the line on taxes in that area, which is no big    surprise.

                Promoting tourism in Delaware falls at.the bot  tom, not a high level  of concern

                there, there are differences-by area of course and by race.

                      BIONDI   John, in the interest of time, let me ask you to summarize

                and make it a little sexier. What is the   attitude of the.people in the

                State? Summarize the overall response of.the people in the State to the

                major source of additional revenue. What's.the least objectionable source

                of additional revenue, if additional revenue is needed? And two, what do

                they think about the coastal zone overall? Let's focus on    those two for.a

                few minutes.

                      LOVLLL: Okay, regarding the additional revenue, there's a fairly

                strong split between an income tax increase  and institution of a sales tax.

                We asked several questions. One, which of three possible methods would you

                least oDject-to? There wasa change, here too, between February and June.

                In February, the least objectionable, thirty-five percent sales tax,,thirty-

                four increased income tax, seventeen percent increased property tax. That

                ciian-ed in June, Forty-two -percent oh-jecting least to instituting a sales

                tax, with thirty-one percent objecting least to increasec income tax. The

                momenium in direction of favoring a sales tax, wher, we comDare the two

                Cirectlv between a nig@ier incouie tax and Institution of a sales tax, the
<pb n="282" />

                                                                                 Page 38

               balance shifted dramatically from February   to June. In June forty-nine

               percent opted for a higher income.tax over a sales tax, with only thirty-

               seven percent prefering a sales tax. It almost reversed by June, fifty

               percent called for a sales tax rather than increasing the income tax,

               forty-two percent calling for a higher income tax as preferable to a sales

               tax. Part of this is probably due to the fact that April 15 came and went

               in the interim between the two. I just wanted to     remind you. However,

               clear majorities,'we read a series of statements and asked them whether they

               agree or disagree with each. Clear majorities both in February and June

               agreed, a graduated income taxis a fairer.form of taxation than a sales tax.

               Clear majorities agree that a State sales tax in Delaware could hurt a

               retail business that depends on customers from neighboring states that

               already have sales taxes.   They split exactly half and half on the argument

               of a State graduated income tax keeps executives who make high salaries

               trom wanting to relocate their businesses or industries in Delaware. You'll

               find this one probably a little bit curious, if the State government would

               cut down waste.in government spending it would have enough money to meet

               the State's needs without a tax increase. Ninety percent of those with an

               opinicr agree. That's an indication of how the public responds, whether or

               not that is anything approximating what's thereal,situation I don't know,

               I doui)t it frankly. But I think that gives you an indication of what kind

               of problems will  be faced if any tax increases are proposed. We asked

               some about some minor tax things, but let's turn to the coastal zone. We

               did a series of statements, both in February and June, repeating the same

               ones and we also asked additional ones in June. In general, first of all,

               the transfer of oil between super tankers and barges in the Delaware Bay

               should he regulated by the State. Strong majorities     agreed both in February
<pb n="283" />

                                                                                 Page 39

                and June  on the order of eighty-seven to eighty-five percent of those with

                an opinion. Drilling for oil and gas should be permitted in the Atlantic

                Ocean off of Delaware. Agreemen  .t was high in February, sixty percent, it

                fel.L by June fifty-four percent, but it is still a Tnaj.o3Kty of those with

                an oDinion. Construction of a super port, construction of a super port

                snould he permitted in the Atlantic Ocean off Delaware, fifty-two percent

                agreed in February while twenty-two percent disagreed,   the rest no opinion.

                The margin narrowed considerably by June, perhaps partly because of the

                easing of the energy shortage, forty-seven percent agreed, thirty-four

                percent disagreed, still a majority of those with opinions supporting

                construction  of a super port in the Atlantic. But construction of the

                super port in Delaware Bay by ten points agreement outweighed di:§.@-

                agreement,  in February by one point in June, almost split dead even on a

                Bay super port. Also on the question of State control on final say or veto

                on super port proposals, strong majorities want the State to have the final

                say whether it's in the Atlantic Ocean off Delaware Bay."' We asked some

                additional questions about the super port, how people would feel about it,

                this is in,June now, if it meant little or no revenue for the State government.

                Well a clear maj ority would,oppose it if it means little or  no revenue. If

                it iead development of a petro-chemical piant on the shore,   a super port

                     _@laware Bay would be opposed by a majority,of those with opinions. The

                question of new  heavy industry in general in the coastal zone, new heavy

                ind-ustry should continue to be prohibited in the coastal zone. Clear

                majorities of those with opinions, agree, both in  February and in June.

                           partIc
                                  ular heavy industry such as oil  refineries, petro-chemical
<pb n="284" />

                                                                              Pag- 40

              plants, and steel mills, only a third approved or favored that idea, a

              majority of fifty-four percent opposed it.

                    What about changing current coastal zone regulations to allow case by

              case d6cisions on construction of new heavy industry in the coastal zone?

              A majority favored the case by case approach even though they are in general

              opposed to heavy industry in the coastal zone. Commercial and residential

              development in the coastal zone, should State approval be required? Close

              to ninety percent of.those with an opinion, yes. We asked some questions

              about growth and development in Delaware too. In general, most people tend

              to think that recent history of growth and development in the State as a whole

              has been about right. Although there's a substantial minority of about a

              third who think it has been too fast. I'm sorry, that's within their own

              area of the State. Statewide they think it's about right. Over the next

              few years the State as a whole should continue to grow according to half

              of-those with opinions,  a third want to stop things where they are now, no

              more growth. Question about control of growth we found first of all in

              February there seemed to he a contradiction, people opting both for local

              control of zoning and pl anning, land usage and the same majority opting-for

              State supervision and control. So we refined that a little bit in June and

              asked a direct question. People don't.care who controls it, they want it

              controlled though. They want State and local government involved in control

              of growth and toning through such measures as zoning. A majority agrees

              the State has not done enough to control land, farm, land from developers.

              People tena to feel, a majority feels that loc ai and State land development

              controls tend, do not restrict developers too much. I think that covers

              the areas o-i' immediate concern.
<pb n="285" />

                                                                             Page 41

                     BIONDI: Thank you John, doe's anyone in   the audience want to ask John

               any questions about  the manner in which they  did the survey or anything like

               that. You will receive    a full report of it and you can read the results.

               Jdhn, I did notice though, when you were talking about those people who

               improved or wanted the services improved or maintained    even if they had tax

               increases, you said they were mostly women; people from    eighteen to

               thirty-four and college graduates; concerned and active    in community

               affairs; business, professional, and small business    people; white collar;

               you went downthe  Iline and you left off the fourth   one   was not registered to vote.

                     LOVELL: We thought we'd be a little selective.

                     BIONDI: Okay, does anyone want to ask anything     about what you've

               heard as an opinion of opinions, and we,are all sophisticated now, somewhat

               sophisticated with what polls are and what utilization we can make of them,

               Is there anyone who wants to ask John a question about the poll? Senator?

                     BERNDT: I think I might   have missed something. Who sponsored this

               study?

                     LOVELL: The study was doneby Oliver Quayle and Company for the State

               of Delaware Planning Office. They    were in consultation with them and they

               approved the questionnaire.

                     BERNDT.: Then the State paid  for thestudy through the   Planning Office.

                     LOVELL: The State paid  for the  study, right, out of federal funds.

                     BIONDI: Out  of federal funds,  as usual.out of a federal grant. Yes.

               Are there any other questions  about  the methods or..procedure involved in the

               poll? Okay, thank you John..

                     One thing I did want to point out and that  is that with respect
<pb n="286" />

                                                                          Page 42

               to each one of the committees which has been formed, in addition to having

               a person from the State Planning Office assigned to each committee, we have

               had discussions with Dean Norman of the School of Business Administration

               at the University and have discussed with him the possibility of having

               a member of the University staff assigned to each committee to help with

               the staff work of each committee. We talked to him Monday of this week.

               And we are awaiting a reply from him. It's likely that we will be able to

               get such assistance from the University for each,committee for guidance

               and support in the work of the committee. Okay, let me open it up for

               any comments, anyone wants to speak on anything we've discussed today?

               Bob Hickman.

                    JORDAN: With all due respect to the State Planning  Office and the

               guy who just gave us that long presentation, I think this offers us a

               dead end on the whole thing. In your opening remarks you  suggested

               that what we wanted to do was to raise the level of discussion.,

                    BIONDI: That's right.

                    JORDAN: On the subject, I do not think that anything I've heard on

               the questionnaire does it, and in fact,.I think it tends to lower it, in

               that respect I think it is unfortunate. Row this may have a useful purpose

               in, from the standpoint that those of you who are responsible for executing

               whatever policies, or putting into effect whatever policies or decisions we

               come up with must of necessity take those kinds of things into consideration.

               I hope that we don't approach this with the attitude that we are going.to

               have this book in one hand and our study material in theother hand, keep

               referring-to it besides where we want to go. I think on that basis we will

               get absolutely nowhere.
<pb n="287" />

                                                                                Page 43

                      BIONDI: I   have no interest in it on that.basis at all, Bob, I have

                very little interest in it as a substantive document at all, period. It's an

                indication of what the.people in the State were thinking in February and

                -June And I don't propose to spend my time continuing to worry      about what,

                they're thinking. I am concerned about what they ought to be       thinking,

                what proper public policy ought to be    and,that's where I'm going from here.

                I trust the Commission will go that route with.me also. Okay, yes, Toby?

                I violated a rule that I was supposed to establish, and that is, when we

                speak,we are supposed to stand up, give our umeand        speak clearly. Stand

                up, speak clearly, and give your name, and who you     represent so you can be

                identified on tape.

                     RYAN: Toby Ryan and I am with the Building and       Construction Trade Council.

                You had mentioned earlier that you felt that these.various,committees,

                these three committees that are set up should actually.have open hearings

                for the public to come in and speak their piece., Well for thepast year

                and a half we have Md hearings up and down the State of Delaware and I

                feel that they actually became a contest.between, now I'm talking about the

                coastal zone, the environmentalists.and.the.econ,omists or myself representing

                the construction workers, and one day you     would have a hearing  and the next

                day in the paper it would say, so and so     outnumbersso and so.    Then the

                next hearing you'd have this group outnumbered that group      and it  was a

                repetitious type of thing and I think if you had these committees having

                these type of hearings you'd actually start into thesamething again.

                     BIONDI: Well, I don't want     to say that I'm  going to discourage public

                hearings, okay. I think it's up     to the committees to decide how they    will

                meet and work and the circumstances under which     they,will hold public,

                hearings. I   do.not think there is much purpose    in having the kind of   a

                hearing in which you simply announce that we're     going to be at X school tonight    and
<pb n="288" />

                                                                              P a g e 4-4

                everybody will show up and just have a gene:@al brawl. That's the kind of

                thing we've had.before, I don't think that offers much hope for the future.

                I would hope that we would look'at it from the point of view of committees

                working up an agenda, a work schedule, deciding to hold a meeting, stating

                the purposes of the meeting, inviting those people with an interest to

                attend, pre-submit their statements and have a serious discussion of the

                problems involved. There will come a time when the Commission puts it's

                entire report together and when people will have a*right to address them-

                selves to it in that other type of public hearing but I'd like to proceed
                basically as the Corporation Franchise Tax Committee'did.

                     I think some of you were members of that committee. I think we have

                to quietly sit down and do some work and when we have meetings to -_`ocus

                the meetings on substantive problems and who can contribute tothose problems.

                The Chairman of each one of the committees is going to have a difficult

                job with respect to that and I want to bring up the subject of the chairman-

                ship.

                     At the first meeting of the Technical Advisory Committee we said we

                would like to have meetings of the committees going in about two weeks.

                We are going to ask the committees to make recommendations from amongst

                their own membership as to who should be chairman of the committee and make

                those recommendations to the Governor who will appoint.the Chairman of each

                committee. We are willing-to entertain any other basis for the selection

                of the chairman. We'll pretty much want to leave that up to the committee

                members at this point to decide how they can best work   together. There are

                considerations   some  people are obligated time-wise at  this point-in time

                to other things and we want the committees to have chairmen who can work with

                the committees. Yes sir.
<pb n="289" />

                                                                                Page 45

                    KRAPF: I'm Fred   Krapf and, Mr, Biondi, I  would like to  take this

               opportunity to thank  the Governor personally for putting me   on this

               committee and I'm sure everybody else feels the same way.     I think this is

               something that Delaware has needed desperately and I know that I've been

               forced out, being in the construction business, almost out   of Delaware and  Vve

               been fortunate enough to do well in other areas and it's nice to be back

               and to hear that maybe they do, want people back in Delaware. I go along

               with.Bob Jordan,., in if you're going to have to sit:through an hour's dissertation

               while somebody is reading me a survey I just don't think.there is any point

               to thissort of thing and I also feel that.there's two things that we do not

               need and that's more surveys  and more studies. We've got enough surveys

               and enough studies that if we  piled them up in. this room I'm sure we couldn't

               get them in here even if they  were on microfilm. I would   like to see us

               get to work and do something  and set a time frame that is  realistic. I go

               opposite with the gentleman,  and I forget who it was who  said, that thought

               if we could just define the problem by June.; I think we  all know basically

               what the problem is and we could all do that very shortly and I was hoping

               by the first of the year we'd come up with some solutions or we just.won't

               have anybody left. Maybe I'm looking at it from a wrong point of view but

               I feel that this thing needs to be pushed you've got a great group of people.

               here who can push it. I   think that we'reall interested   and I hope that

               we can move.that time  frame up before June.

                    BIONDI: Well, I   think we're going to try to adhere  to the schedule.

                I think we can proceed with the  schedule. .1 agree with  your.comment
               with respect to further studies.   I have already.opposed  and canned the  hiring

               of consultants to put  together a study of the studies we  have. I think
<pb n="290" />

                                                                              Page 4o

               we have people on the Technical Advisory Committee who can sit down and

               put the studies together. We've done enough studying. The raw materials

               are there and the studies are there. What we need to do is come to some

               informed judgments about them except in certain areas. I think that we

               do in the State have an absence of critical data with respect to some

               of our problems.

                    Let me indicate one of them I'm personally familiar with. It was

               the Corporation Franchise Tax. A recommendation was made     as a part of  a

               Delaware Tax Study Committee that the top rate of the Corporate Franchise

               Tax for those  corporations paying the maximum would be.increased from $110

               to $150 thousand. It would raise $3 million. The Corporate Franchise

               Tax Committee, when it was appointed by the Governor to study the problem

               in depth, thought that recommendation would be disastrous. The point I

               want to make is that the first questions we asked were questions like this:

               Who pays the Corpora te Franchise Tax? How is it stratified? Is it

               classified into eleven classes of corporations by amount of tax paid?

               How many corporations fall in each class? Are these corporations in the

               state or do business outside the State? If you took all the corporations

               on the New York Stock Exchange and put them in the stratifications, where

               would they fall? Where would those in the American Stock Exchange fall;

               Where would those on the Over-The-Counter Market fall? (CHANGE OF TAPE)

               How did corporations  progress through the rate schedule?. What happened

               to those corporations  who were paying the maximum ten years ago? What's

               the status of the Corporation Franchise Tax in other states? What's the

               cost of 'Incorporating in other states comparable to Delaware, taking into

               account incorporation  costs, and  taking into account the cost of domesticating
<pb n="291" />

                                                                                Page 47

                 a foreign corporation? We   sat down and asked those   questions. They

                 were good questions, but there weren't any answers to those questions.

                 There had never been any data developed. The first thing we had to do

                 was hire programmers to come in and secure that kind of data     out of our

                 own records. Yet people in the State have been making judgments       about

                 the Corporation Franchise Tax and what you could do.with it everytime

                 there's been a tax crisis, and it's been a bi-partisan attack on the tax.

                 It produces somewhere about  sixt een percent of our revenues. Well,      think

                 welre in the same position information-wise with respect to a lot of other

                 critical questions, but I don't believe it's going    to take an extended.

                 period of time to find the answers to those questions.     Okay. Anybody   else?,

                      Arthur Krieger, you!ve got nothing to say? Throughout the meetings

                 of the Corporation Franchise Tax Committee you k    ept saying, what are you

                 going to do to bring new business to Delaware and I    kept telling you, you

                 were not being relevant to the issue. Today you have a chance to be relevant.

                      KRIEGER: I'm at a loss for words.

                      BIONDI:  You'r e at a loss for words. That's the first time I've found

                 you at that.

                      KRIEGER: Don't get   excited, Frank.

                      @BIONDI: Okay, Henry, do you have any ideas about    what we're about.

                 here? Do you  see us being able  to coordinate what's going on here with the

                 things you're doing in the county?

                      FOLSOM:  Very definitely. We're    plowing the  same.field. Very definitelyl

                 our committee and the county government of course    are pl owing thesame field.
<pb n="292" />

                                                                                Pa,e 48

               I think we have much of.the input data, certainly the interest and I hope we

               can contribute.

                    BIONDI: Thank you Spencer Thompson, I took a lot of your thunder.and

               relied on it in my opening remarks. I didn't plagarize it however.     Do you

               have any other comments at this time ? You've given some thought to the structure.

               of the Commission and its membership - it Is function.

                    THOMPSON: I don't know that you are going to be    too successful in

               having this group select their own chairmen. I think    we are going.to

               comments are going to move quickly on this. We're putting people together

               who havenl-t worked together and it would be helpful to have suggestions

               from you to the committees, Frank, as to how it might be accomplished.

               Secondly, most committees are no better than the staff that you've got for   them.

               I think it's important, to,get somebody, assigned as a secretary to the committees

               who has got the skills to help them pull   the information together  and to sort

               out the information-.

                    BIONDI: Alright, I think we can take   care of  the second problem. As

               to the,first problem.with respect to the selection   of the chairmen, is there

               any kind of a consensus here that perhaps- that I.should talk with members

               of the various committees and secure their suggestions, and then make a

               suggestion to the Governor.as to the chairmen of the committees. That's the

               best way we should proceed? How. do you feel about it? Okay, we'll    go along

               on that basis..

                    BRYSON: You're the Chairman, Francis.

                    BIONDI:. I'm trying.to be,.democratic today,  with a small

               John, but I have no hesitancy.about making those   kind of decisions.  Al?
<pb n="293" />

                                                                                Page 49

                      MADORA: Al Madora, Director of Public Works,     New Castle County., I

                suggested that  why wouldn't a couple meetings, let    them decide a temporary

                chairman for the evening to get a feel of who's on     the committee.. You know,

                get a feel of the people and then maybe the committees themselves      could get

                together and recommend someone.

                      BIONDI: Well, that's an alternative Al.

                      JARDINE:  Why don't you  have  the Commission  members of each  committee

                select the chairmen?

                      BIONDI: I think you can   expect  the chairmen to be   selected in the

                bmext.few.days. I'm not going   to  be hung up,on this kind   of problem.

                      MADORA: That's where the    power comes.in, right Frank?

                      BIONDI: Well, we've had   reasonable discussion between    reasonable men,

                now it's time to make a decision, and we'll go on. Now are       there any other

                comments? Leon?

                      WEINER: I think there are two questionsthat      don't fall in.the      Leon

                Weiner is my name - that don't fall into either of     the three committees,

                but run across.the grain on both and Ild.like to.suggest that somewhere,

                in some fashion, either some guidance.from you as Chairman or what other

                method you'd use to try to deal.with them.

                      The first is the question that you pressed upon,,which is the relation-

                ship between the State, county, and    local governments. It is a critical

                one,,not only from  a legal point of   view as to which.has    the power and the

                responsibility,  but also how they   can function  inthis   kind of..relationship

                so we don't produce,an overlapping    and.extraneous consideration of. these

                things that are not, you know, feasible.     And the second is, a consideration

                of what is thegeneral attitude toward     growth?   We have assumed from hearing
<pb n="294" />

                                                                          Page 50

              what you've said today, that we're going to have growth. I would suggest

              there are some people here that don't believe it,.or may not want it and

              I think that if you're goingto have a fruitful. kind, or meaningful, or

              whatever word you want to useout of here, there needs to be some kind of

              a posture which suggests: (a) that a certain amount of growth is going

              to happen whether we like it or not or examine the alternatives, and (b)

              face up to that responsibility. Because I think that many of our dis-

              cussions can get lost without getting that second,question dealt with.

                   BIONDI: I think you've put your finger ontwo good questions, Leon..

              I think that there are going to be primary questions that the  Technical

              Advisory Committee is, going to have to be wrestling with and each one of

              the subcommittees. Now therels.going to come a point in time as the sub-

              committees go on with their - it's obvious that - well, let me say

              about anything can happen, but.we currently have two systems of control

              over State and local zoning and planning for example.. You have one level

              of control at the local level and I don't know anyone at the local level

              who would support the assumption of the planning and zoning function by

              the State. On the other hand, the Coastal Zone Act itself is the result of

              a zoning authority by the State and may not be consistent with what'@

              going on at the local level. I think we're going to have to answer this

              question in terms of how we approach problems. For example, I asked Dick

              Bauer at the meeting of the Technical Advisory Committee a question con-

              cerning the industrial growth study which is being done pursuant to the

              208 Program. I asked him in doing that industrial  growth study were they

            .going to look at the problem of the c oastal zone from the point of view

              of land use planning in the coastal zone, and what land use planning would

              dictate with respect to industrial uses.within the coastal zone or were
<pb n="295" />

                                                                               Page 51

                or were they,going to look at   it on  the basis of the fact that it was

                simply prohibited. He advised    me that he was going to look at it from

                the point of view of what proper land use planning would call for in the

                area. In that context, you are dealing     with the problem of State vs. local

                control and out of this discussion, and    out of the work of these committees,

                weire going to have to come up with State policy which is either coordinated

                with or in some cases conflict with thelocal policy. The object of working

                together with these Technical Advisory.Committees and     with these committees

                having a broad membership of local government officials.is to see where

                the consensus is.   But your two questions are questions we are going     to

                have to take on early. Yes.

                     VAUGHN: And kind of in line with what     Mr. Weiner has said, a couple

                of things that are going to be common to the    work of several of the

                committees., one kind of a procedural one. In figuring out things to do

                c.onstructively, thequestion that we must,ask    in every committee is who

                will do these? So each committee is going to     have to wrestle with the

                matter of who's going to do what, and maybe we're going to need some

                guidance from the Chairman, and from the Governor, and our legislators

                as to how to handle that one and then.as concerns another bit of subject

                matter tha t is common to all three committees, and yet not really assigned..

                as the responsibility of either one per se, and that's transportation.

                Tr'ansportation looms large in the economic development matter. It looms

                large in the land use and community facilities and in terms     of the Post

                of, the various public services that the State will have to provide in the

                future. It is probably going to be one of the biggest. Well, how do we

                handle transportation?

                     BIONDI:   Land Use and Community Development? It was on a list that
<pb n="296" />

                                                                         Page 52

              Dave had prepared and he proposed to handle it in the Land Use and

              Community Development.- Why did you think it was most relevant there Dave?

                   KEIFER: Because it was essentially a matter of urbanization policy.

              It was a question of transportation.

                   BIONDI: Okay, well, that ought  to be raised early on in the sub-

              committees as.to whether or not it's  in the right ball game. Are there

              any other comments?

                   KREIGER: My name is Arthur Krieger, I just wanted to check with you

              Frank, as to what your plan is as to the mechanics of coordinating from

              here on in?

                   BIONDI: Well, I think that-meetings of the three subcommittees should

              be set-up to take place within the next two weeks. The staff officer

              assigned to Land Use and Community Development is Mr. Hugg. The staff

              officer assigned from the Department of Planning  to the Economic Development

              Committee is Mr. Hudson, and the staff officer assigned to the Cost of

              Public Services is Mr. Fisfis and I think they should be in contact with

              the members of the committee this week and ascertain the best date and

              time. Now, maybe something we can get straightened away here now is,

              comeone called me and indicated that he preferred to have the meetings

              in the evening. What about the difference between evening and afternoon

              meetings. Is there any consensus of the group as to when the meetings

              should he held?

                   ANONYMOUS: Afternoon.

                   BIONDI: A strong vote for the afternoon.

                   ANONYMOUS: Afternoon.

                   BIONDI: A second strong vote for the afternoon, how about t,he rest

              of yout
<pb n="297" />

                                                                              Page 53

                     ANONYMOUS: Evening.

                     BIONDI: All right,.why don't we do this. Each of     you guys from the

                Planning Department try to schedule the meetings at a time that aatisfies

                the majority of the  members of the particular-committee., Okay?    And if

                you have,,a conflict, a tie vote, call me. Now, Art, we would look forward

                to getting a meeting going within two weeks. Dave.Keifer himself is     going

                to call a meeting of the Technical Advisory Committee.,.We are going.to

                have transcripts made  of these meetings and  also summaries  of these meetings

                prepared and shall distribute. Have we made    provisions to  distribute to

                everyone here today a summary of this meeting?

                     KEIFER:, We'll do it.

                     BIONDI: Okay, Would    that be helpful  if we did.that so you could

                maintain an informational  flow? Alright we'll.do that.    We'll also get

                out to you, to eachone of   the committees,:the.suggested  tentative areas

                of your interests. We want   to make it understood that concerning the

                areas in which you are going to work, we want the judgment of the people

                on the committees with respect to that. What we have done is merely given

                you.suggestions. I will attend the meetings.of the subcommittees, at

                least the first meetings  of the subcommittees so that we won't stall,

                around for lack of  direction. Now, is.there anyone who thinks his

                services would.be  better utilized in some other  capacity than on the

                committee he has been assigned to? We tried to    make a judgment but you

                can't be right on all these, yes?

                     THORN: My name is Ernest   Thorn,  Common Cause,.my own  particular

                experience is on land use, not  public cost,. but I am willing to work

                wherever I am needed however.
<pb n="298" />

                                                                        Page 54

                   BIONDI: Alright, well I can't see any reason why that can't be

              honored.

                   THORN: I'm representing  Stewart.

                   BIONDI: Okay, you want to change  that designation then to Land Use

              and Community Development. Fine. Are  there any other suggestions at this

              time? Yes sir.

                   WALTON: My name is John Walton, I would rather serve on the Land Use
              Committee but I have a strong interest in'the Economic Development also

              but I'm more concerned about one thing now, Mr. Bion di I hope I'm

              not getting the impression that this Delaware Commission - I know we have

              great conflict of interests of opinions in the room and the people in

              the room who know me or know my views, they may resent them or they may

              not, but be that as it ma y, I don't want to lye part of a commission and

              I don't think anyone else does that's going to rubber stamp an industrialize

              Delaware Commission. When people stand up and say let's get this thing on

              and get on with it that just leads me to believe we're going to get on

              with something.

                   Now there may*be some polls, for example, Mr. Biondi, that the majority

              of opinion was that we want to accept a moderate growth plan and something,

              not that my organization says this or anything else, but that maybe we want

              to accept zero growth or a certain percentage growth. Would these people

              be as anzious to get this report out and get on with it? I mean this is, if

              welre going to work in the interest of everyone, I think right now, I'd rather.

              serve on the Land Use Committee. I'm interested in Economic Development

              but I think there should be another meeting of this Commission itself and then
<pb n="299" />

                                                                                Page 55

                 have your subcomm ittee meetings,-so we   get a chance  to hear from everyone

                 because there are people in this room who I've never heard their views.

                 I know by organizat.i on who they are but I'd like to   hear from the people in

                 the Commission and know what their views are.

                      BIONDI: Well, my own judgment    is that@the committee structure is the

                 best way to proceed. The reason why    you were put on,the Economic Develop-

                 ment Committee is because you are the   representative of the Farm Bureau

                 and one of the critical questions is   the extent to which   farm land,-.-in the

                 State should he preserved for agricultural purposes.

                      WALTON: You just,said farm land and agricultural purposes.        That's,

                 land use.

                      BIONDI: Well, it's   also  relevant in  the Economic Development area

                 but as I say, fine.

                      WALTON: Well after you've read    over your several lists there    and I

                 caught it. I don't know where you're discussing agricultural lands in        the,

                 future and things of this type, I really don't. I would assume it would

                 be under Land Use but if it's going to be under Economic     Development  then,

                 that's.okay.

                      BIONDI: I   think that's an  important  consideration in the  Economic

                 Development area. But I have no     objection to,you serving,on the other.

                 committee.  Okay?

                      WALTON: Alright.

                      BIONDI: Any other comments? Okay, does anybody       have any suggestions

                 as to future procedures other than a motion    to adjourn.

                      ANONYMOUS: Seconded.

                      BIONDI: Thank you all    for coming. Would   you all signthe   register on
                 your way out if you haven't  'signed it yet?

                 Lynn Drummond
                 Recovding Secretary
<pb n="300" />

                                            STATE OF DELAWARE
                                          EXECUTIVE DEPARTMENT
                                               PLANNING OFFICE

                                                    DOVER
       SHERMAN W. TRIBBITr                                                                  DAVID R. ]KEIFER
                                                                                              DIUC

                                      DELAWARE TOMORROW  COMMISSION

                                                  MINUTES

                                              April 8, 1975

                     Attendees*

                     0. Francis Biondi                      Peter  A. Larson
                     David R. Keifer                        Hector J. Rodriguez-Costa
                     Clifford  Hearn                        W. Spencer Thompson
                     E. Sherman Webb                        David  S. Hugg
                     Carl Russell                           Nick Fisfis
                     Ernest W. Thorn                        William R. Latham
                     John.C. Bryson                         James  H. Gilliam,  Jr.
                     Jane Tripp                             Dan Kuennen
                     Marvin Brams                           John F. Walton
                     Joann D. Slights                       Theodore W. Ryan
                     Dorothy Greer                          Joseph Golden    .
                     Arthur Kreiger                         John D. Daniello
                     William Bradford                       Gerald L. Cole
                     William Markell                        Bruce L. Hudson
                     Leon N. Weiner                         Henry Ridgely
                     John B. Morton                         Crawford J. Carroll
                     Jay N. Cooperson                       Joe Conaway
                     Marcie Bierlein

                          Cha-i man Biondi called  the meeting to order.at 3:15 p.m. and

                     welcomed everyonelto the second meeting of the Delaware Tomorrow

                     Commission.

                          The purpose of this meeting is to present three Committee

                     reports to the Commission, with summaries to be given by the

                     Committee Chairmen, and to discuss future action by the Commission.

                          The Economic Development and Land Use and Community Development

                     Committee reports were mailed to everyone prior to,the meeting and

                     the Cost of Public Services Committee report was distributed at
<pb n="301" />

                                                     2

                    the meeting.

                          Chai man Biondi stated that hefeels the Commission members

                    should consider the reports of the three Committees with any

                    dissenting views of Committee members that may come,in over the
                    course of the next several weeks and that we should   set a time,

                    10 days or so, formembers of the Commission to.comment, in

                    writing, with respect to the contents of all three reports. If

                    they disagreei they should state their reason for disagreeing.

                    The Commission members bhould suggest anything that they feel

                    should be dealt with that hasn't been dealt with bythe three

                    Committees.

                         Chairman Biondi proposed to then hold a meeting one week

                    later of the Commission to consider these reviews to determine

                    to what extent the Commission will adopt as its own report. These

                    ideas are open for discussion. Everyone will have an opportunity

                    to fully consider the reports and to comment on them.in writing.

                         MR. THOMPSON: In commenting on the report, I will assume

                    that you've read it, I am enough of a realist to realize that you

                    haven't all read it but I have to go,on the assumption that you've,

                    read it. In'the report, we tried   to survey, forthe Commission, the

                    major elements affecting economic  development in-the State. We did

                    this not to try to arrive at a conclusion as t6   what the futurd

                    rate of growth in the State should be. We felt    that's really an issue

                    that the Commission ought to consider, not only   in the light of the

                    economic positions withthe land.use and the cost  of government and

                    other elements. What we did try to do was to bring the    gwowthof
<pb n="302" />

                                                     3

                   the State in the last 20 years tnto perspective, to explain why

                   that growth had taken place and then to try to give you some idea

                   of the kind of economic growth we would foresee in the next 10

                   years just from the industry and the population that's in place.

                   Also, we tried to lay out for the Commission some of the things that

                   you could do if you really wanted to accelerate the rate of growth

                   or direct the rate of growth in the next 10 years. We weren't

                   trying to say'what it ought to be, we wer  e just trying to clear

                   the brush out.of the way so you could look,at   that basic issue.

                   Looking at the past 20 years,.what did we find that was significant

                   to the work of the Commission? First, Delaware's growth in the last

                   20.years,,both in population and in jobs,   has been phenomenal. It's

                   one of the. fastest growing states east of  the Mississippi in that

                   20 year period. This rapid growth of the    last 20 years has required

                   a substantial in-migration of people into   the State; it wasn't a

                   growth that grew out of the natural growth   of population, it was

                   a growth that partly was from the natural   growth of population but

                   at least ha lf of the growth was a result of in-migration for

                   peop.le to take new jobs in Delaware. The   rate of growth was

                   greatest.in New Castle County. This growth was achieved in spite

                                                    ation in the State, in the City of
                   of two areas of declining popul

                   Wilmington.and in,rural Sussex County. So the growth is all the

                   more remarkable when you lookat two depres'sed areas that we've

                   had within the State. Also-, the growth was in spite.of two or three

                   declining areas of jobs in the State. In other words, there has

                   been a substantial decline in the number of people employed with
<pb n="303" />

                                                          4,-

                      the'railroads has declined     significantly in the past 20 years. The

                      leather working industirtes,    which had an   activity  in the'Wilmington

                             has all but dispppeared and some of      the Marine activities in

                      the Wilmington Basin and around Lewes have declined significantly

                      in the last   20 years.   But in spite of that kind of decline, overall

                      the State, has had this   remarkable rate of growth.

                            The growth that.we',ve had has been in'the higher paying

                      industries. @In   the industrial area, growth.has been in autos and

                      chemicals and both of these'industries are on the high side of

                      rates of pay  Ias compared to all industrialAobs in the       United States

                      so the present   per capita income in    Delaware has been rising in

                      the last 20 years as well as the growth of population and jobs.

                      However, it   is interesting that the most rapid rat     e of growth in

                      employment   in Delaware  in the  last 20.years was    in government and

                      in the service categories. From our point of        view the.very rapid

                      rate of growth in government jobs are a cause       of concern and you'll

                      see it reflected on the other side and,the cost of-government on
                      that, as to whether the burden of government.has become.much greater

                      in the State during the period of the last 20 years and what happens

                      to that rate could have an effect on economic growth in the-next

                      10 years. The growth that we've had has res        ulted few se  veral

                      factors. Just let me indicate what I think are        the three 1p*ajor

                      factors affecting the growth: (1) The location        of the State    in the

                      northeast corridor, as it's called, between Boston        and Washington,

                      and the  improved transportation in the     corridor,   particularly   the
                      major highways..that have been.added, contributed-to       alot ofnew
<pb n="304" />

                                                       5

                     industry locating in the Delaware area, strategically located and

                                p                                 an availability of good
                      t was acce tably located. (2) There was

                     land sites in the State and the related utilities: water, roads,

                     railroads, gas, sewage, and so forth. These serv     ices generally have

                     been good in the State of Delaware, particularly as compared to

                     Pennsylvania and other areas as in this geographic area. (3) There

                     has been a favorable tax base for business in Delaware as compared

                     to Pennsylvania, New Jersey, and Maryland..

                          These three factors have contributed to alot of new industry

                     moving into the State. It's been done'with no special incentives,

                     by way of special revenue bonds, or tax     credits, or subsidtis from

                     government. There have been subsid&amp;ts but there's been no marked

                     subsidy in Delaware as compared to Virginia, the     Carolinas and

                     areas like that where they'd really gone out to     subsidize bringing

                     industry in the last 20 years.

                          Looking at the next 10,years, we think the     rate of population

                     growth, both in Delaware and in the nation, is going to     slow down

                     considerably. The national,growth certainly is slowing      down and

                     the rate in the  State is slowing down, largely as.a result of the

                     decli.ne in the birth rates. Alto, we think that there will be

                     .a substantial drop off in the internal migration of people within

                     the United States in search of new jobs. Migration is becoming more

                     difficult and witl remain difficult for the next,10 years because of

                     mortgage rates and alot of 66her things that are slowing down that

                     migration. So that unless Delaware makes major policy changes, the

                     rate of growth.in net new jobs and in population will drop sharply
<pb n="305" />

                                                     6

                    in the next 1.0 years as compared to the last 20 years. However,

                    because of the location of the State andbecause of the present

                    industry already located in the State, it fs the judgement of our

                    Committee that net new jobs will grow,.at,least as fast as the labor

                    force without net in-migration. In other words, we don't need

                    to make a special effort to bring alot oflnew jobs in the State in

                    order to provide jobs for our existing population.

                         The majority of our Committee felt that.the,net,growth   in

                    new jobs in the next 10 years would be more than the,growth   in the

                    work.force from the existing.population so that we.wowld have   some

                    net in-migration, bven from existing industry growth over the    next

                    10 years, but even the most pessimistic members of our COmmittee

                    felt that the growth in jobs, while it will,slow down, will not

                    be less than the growth in the size of the labor force from existing

                    population.

                         Secondly, we think the per capita income will keep pace with

                    the national data because of the kinds of industrJes and the kinds

                   @of jobs that are available in Delaware. In   other words, it was

                    our judgement that Delaware does not face a crisis atthe present
                    time, such as New England faced when the.textile  mills moved out

                    or such as the Appalachian areas,.of this fountry, faced when the

                    coal industry declined substantially, or as you had in  the deep

                    South when there was a very significant c.hange.in the Agricultural

                   .patterns so that there was a lot of excess population available.

                    We don't see that kind of crisis in Delaware in the next 10 years.
<pb n="306" />

                                                     7

                    However, the decline in the rate of net new jobs, and the decline

                    in the growth of population as compared to the last 20 years, will

                    generate certain political pressures. We're aware of these, we,

                    can see some of these pressures, even evidenced within our own

                    Committee. For example, the construction Industry in Delaware has

                    been a booming industry for the last 20 years because of the

                    phenomenal growth. When the growth drops off, the construction

                    industry is hurt and so there is pressure to accelerate the rate

                    of growth in the State. The same thing is true from real estate

                    interest and other interests that profit from escalating land

                    values and construction activities.

                         ThIs decline In-the rate of growth and the resulting political

                    pressures, in our judgement, give the Commission the job.of wiighing

                    all the facts and making the soundest decision for the State

                    as to what kind of a rate of growth we'd like to have in the next

                    10 years. Delaware, in our judgement, can afford to be selective.

                    we're not in a state of crisis. We're at a point that, if we

                    can agree on our future, we can make some intelligent decisions

                   Ao influence that future.

                         Now, the other thing  we tffed to identify for the Commission

                    the things, the aspects of the job, that will effect economic

                    growth. First of all, we.felt that the State should concentrate

                    on bringing in industry into  the State that will tend to turn

                    around the declining, or the  depressed areas, of the State; namely,

                    the City of Wilmington, and  the rural areas of'S.ussex County.

                    These are the two geographic  areas of the..State that ought to have
<pb n="307" />

                                                      8

                    particular attention, to the extent that we're being selective.

                    We think that the State must be selective to get needed results,

                    you can't get any kind of industry to come into the Wilmington area or

                    come into Sussex. There are only certain kinds of industry that can

                    be attractive, and if we're going to bring them into the State, we're

                    going to have to really concentrate on that kind of industry and under-

                    stand why we're doing it.

                         Secondly, we think that in Delaware, we need a  much stronger State

                    development agency, (and this would include the State Planning Office

                    organization) in order to compete effectively with surrounding States.

                    In the last twenty years, a number of States have done a great deal to

                    facilitate new plants or new industry moving into the.State. One of

                    the ways they've done it is to have a strong State development agency

                    that could meet with the prospective industrial clients and help them

                    settle all their problems in a very efficient and effective manner.

                    We don't have that kind of mechanism in  Delaware today. I know, I've

                    been through this process on the business.s.id e of it, in terms of putting

                    a new plan in Delaware, it's a much more complex job than building a
                    new plant in Virginia, where the Governor, through his development agency

                    on down-they really roll out the red carpet to make it attractive to-

                    come in and they bring all the resources of the State to your doorstep

                    to encourage you to come in and build a plant in their State. We are

                    not now competing in that league, and if we're going to bring   industry

                    into the State, we're going to have to think competitive, and   overcome

                    some of the county, city and local jealousies and frictions that we have

                    in this area of bringing industry into the State. We're going   to have to

                    do it.also if we want to be selective and effective.

                        More than this, we think that the State needs   to go to work on some

                    major economic problems, which if not corrected in  the next 10 years, could
<pb n="308" />

                                                      9

                  seriously impede  economic growth.  For example, the railroad network,

                  south of the canal, is in  deplorable condition based on a report the

                  Committee received. It has deteriorated and is in bad condition. Now

                  if that isn't turned around, it's going to have a real impact on getting

                  ne w industry to come in south of the Canal, if that goes down the drain.

                  That's major economic factor facing the State.

                       Secondly, the State has not been spending, as the cost of government

                  data will show you, a proportionate-share on the highway network. This
                  is beginning to  show up in New Castle County, where we're getting.more

                  and more bottlentacks, whether you look at the Newark area or you look at

                  the area around Wilmington, and unless we spend the capital to break those
                  highway networks, it's going to impede the rate of growth, even in the New

                  Castle County area,

                       Thirdly, we think that it's important to give close attention to the

                  rapid rise in the cost and the burden of government. Delaware, in the

                  past twenty years, has been a very attractive place to come into, because

                  the tax rates have been attractive for industry and the relative cost of

                  govern mient, from a, business point of view, have been low  You look at

                  studies that are made in New Jersey, Maryland, and Pennsylvania, and they're

                  all looking at Delaware, saying how much better off Delaware is, but that gap

                  is narrow. If we continue to have an increase in the cost of government

                  in the next period like we've had in the past, we could loseAhat advantage

                  entirely. I think,we need to understand why that's happened and whether it

                  can be turned around.

                       Those are the  major issues, in my mind as  I've worked with the Committee.

                  The'Commission needs to decide really how much   growth is desirable in the

                  next 10 years, where the growth should take place, what kind of jobs we want

                  to bring into the State, and we want to weigh the costlof that economic growth
<pb n="309" />

                                                    10

                in terms of bringing it into the State. We think we're going to get

                growth roughly equivalent to the increase in our work force from existing

                population without effort that is significantly more than we put in, just

                from the industry that's in place. Beyond that,, we think the Commission

                has to look at it, in the larger aspect of the Commission.

                     That, Mr. Cha irman, is my summary.
                CHAIRMAN BIONDI: In several places within the report there was the comment

                that there may have been another view with respect to the rate of growth

                expected in jobs and population.. Did anyone on the Economic Development

                Committee plan to file a dissenting report, or file any comments?

                     MR. THOMPSON: We have had,a difficult time sorting out the actual

                employment records by industrial categories in the State, in the last.twenty

                years, and the rate of increaseor decrease. I think by the end of the

                month, probably in the next week or ten days, some research that we have

                had carried out for us by the University of Delaware will be completed,

                and as a result of that research, we will have eliminated most of the disputes

                over the figures. We Inay have som e disputes on the rate of §rowth in the

                future but at least we'll eliminate the disputes on what happened in the

                last twenty years. We may have some dissents.on how much growth we expect

                in the future, whether it's just enough to.take careof population or whether

                it's going to require some in-migration. We couldn't settle that debate

                until we had better data on what happendd in,the last twenty years. We had

                some curious anomolies out of the Department of Employment Security in which

                the population grew fastest between 1953 and 1.963, but the number of jobs

                grew more rapidly between 1963 and 1973. 1 think it's because of some.dis-

                tortion on how fast jobs actually grew in 195.3 and 1963 as compared to 1963

                and 1973. 1 think in anobher ten days we'll have that reconciled.
<pb n="310" />

                     CHAIRMAN BIONDI: Will your Committee meet   then after getting

                that information and supplement this report?

                     MR. THOMPSON: Our Committee will do two things: We'll meet to

                consider that and we'll also meet to give the members of our Committee

                an opportunity to submit any dissents they have in writing.

                     MR. WEINER: Spencer, has your Committee at all been aware of or

                coordinating with, the rather elaborate study that has been going on in

                New Castle County, known as the 208 Study, with regard to this question

                of growth and industrial land use needs and projection and allocations?

                     MR. THOMPSON: I would have to say that the projections New Castle

                County has come up with are not far off from the projections that we

                have been making. If anything,  they may be a little higher than the  pro-

                jections we have made, but they are not seriously out of step.

                     MR. WEINER: One of the reasons was that, on the question  of employm6nt,

                they have done a rather definitive study industry by industry and sub-area by

                sub-area.

                     MR. THOMPSON: Which is what we're also doing, independently, and
                weire going to cross check it against their figures.

                    ,CARL RUSSELL: Specifically, have you used the 208 proposal as the b,--is
                for most of your direction?

                     MR. THOMPSON: We haven't used it at all, it's been done entirely

                independent of what we did.

                     MR. RUSSELL: The work being done by the University is that the work

                that is going to tie in with that study?

                     MR. THOMPSON: Yes, the work being done by the University will be cross

                checked with the work that this group did, to see where our differences

                exist, if any. That will be handled in an addendum to this report.

                     MR. WEBB: You pointed out that the growth of government and growth

                An service industries during the past twenty years was pretty strong in Delaware.
<pb n="311" />

                                                     12

                    Did you do any checking to see if it was abnormal in relation to rates

                    of growth in other States or other areas? It appears that this is a

                    national phenomenon and not necessarily a localone.

                    MR. THOMPSON: There are two things on the service area: the number
                    of service jobs in relation'to the number of jobs in basic industry

                    have been growing. This will continue to go that way if the purchasing

                    power of jobs and industry continue to go up--they will be demanding

                    more services and buying them, so the ration may move from 3:1 to 4:1

                    in the next twenty years. I think what's happened in Delaware may.also

                    be influenced by what's happened on the location of a lot of shopping

                    centers just over the State lines in Delaware. If we should have a sales

                    tax it might change that rate of growth in the future as compared to what's

                    happened in the last few years, where there's been some advantage in

                    locating a shopping mall just on the Delaware side of the line, rather

                    than on the Pennsylvania or Maryland side of the line.

                         MR. WEBB: How about tourism. That's been quite heavy. Are they

                    considered service for your purposes.

                         MR. THOMPSON: It'san important industry, in total number, not all

                    that large, as compared to a lot of other retail trades, some of the

                    others are much larger.

                         MR. WEBB: One last question. You say that.the growth will be at

                    least sufficient to take tare of the new entries into the work force, and

                    possibly (a majority said') it could exceed it and require some in-migration,

                    but you're not suggesting that the mix within that work force might not do

                    some changi,ng. Is that not correct?

                         MR. THOMPSON: The  mix may change from the mix that there's been  in

                    the past. This, our report indicates,  might put a burden on career educa-
<pb n="312" />

                                                  13

                tion, and so forth, in the State,-to make sure that that's adjusted to

                anticipate the kind of mix that will take place in available jobs.

                     MR. CONAWAY: In reading over the report, I was a little perplexed

                with the absence of Sussex County, but with your comment about that being

                a target area, I would say that we are very pleased to hear that- that is

                a desire of the group.

                     MR. RUSSELL; You mentioned in your summation  that one of the areas

                which needs to be addressed is the increased cost of government in the

                past few years. I didn't see specific mention on this in the report.

                Would you elaborate on this a bit. How far did you do into.that?

                     MR. THOMPSON: From our employment data, we were awaretthat the number

                of people employed in government has increased much more rapidly than the

                number of people employed in the service industries or in basic industries.

                It's in that sense that we saw the cost of government going up, we just ran

                up a cautious flag, but we didn't get i,nto it because we felt another

                Committee had that responsibility.

                     MR. RYAN: I am a member of that particular committee, but I miss ed

                the last couple'of meetings. Was there anything brought up  about the Coastal

                Zone act, in its present form?

                     MR. THOMPSON: No, there wasn't. As the report indicates, there's

                been no evidence brought before the Economic Development Committee that the

                Coastal Zone Act was a serious impediment to the economic growth. We didn't
                have any strong evidence one way or the other. So we.didn't really get deep-

                ly involved in the Coastal Zone Act. Again, we felt that this was more of a

                problem for the Land Use and Development Committee, than it was for ours, since

                we could seesufficient jobs  available in the State for the existing popula-

                tion, without getting into the Coastal Zone Area.
<pb n="313" />

                                                    14

                       MR. RYAN: I had written about a four or five page letter, that

                  the Economic Development Committee had requested.' I had mailed it back

                  to the Economic Development Committee, and stated on there about the

                  unemployment in the building trade. We gave reasons, in this particular

                  let ter that I had written, as to why we thought the Coastal Zone Act, in

                  its present form, was harming the construction industry.
                       MR.,THOMPSON: I have alluded to the fact that the Construction
                  industry is one of the hard hit industries within the State at this point,

                  particularly with the decline on it. I really think.that it's an issue that

                  the Commission needs to address itself to. The Economic Development

                  Committee did not try to resolve that issue.

                       CHAIRMAN BIONDI: I want to pursuade the members of that Committee

                  that they should undertake that question deeper than they have or in a

                  different form than they have -address it there or file a dissenting report.

                       MR. WEINER: To clarify, you are saying that employment opportunities

                  for the existing population, as a result of its natural growth, will be

                  available without any major economic increase other than the natural

                  growth of the economic elements which are present today. Are you assuming

                  that you would exclude in-migration or look fora balance between in and

                  out migration for that kind of a population defined as existing.

                       MR. THOMPSON: When we talk about existing population, we were looking

                  at the number of net new entrants into the labor force, as a result of

                  youngsters 15-18 coming into labor, as compared to the deaths and people

                  withdrawing from it. We assumed, in projecting against the jobs on that,

                  that there will be some out-migration, there'll be some in-migration, but

                  they would tend to net them out. But we say that the minimum estimate is

                  with no net in-migration, the growth of jobs would be equivalent to the

                  net new labor entrants of the labor force
<pb n="314" />

                                                  15

                     MR. WEINER: With a population base projection to do what in the

                next 10 years, increase or not?

                     MR. THOMPSON: Whether the  population goes up or not in the next

                10 years is not important, because the population is already in place in

                the State, that will be coming into the labor market.

                     MR. WEINER: But it's based on the stable no increase in population

                in terms of job producing requirements. In o,ther words, there will be

                no people coming of age, and you are making the assumption that in-migra-

                tion and out-migration will met out at basically zero.
                     MR. THOMPSON: When-we made the projection of jobs, we thought there
                would be more jobs than the net increase in the labor force from 'Che

                existing population.

                     MR. WEBB: Didn't you say that there were two findings of the

                Committee and that one was that, at the minimum, the new jobs would.be

                equal to the new entrants and the other was that there was a.!majority

                who felt that there would be more and,would require some additional

                in-migration.

                     MR. THOMPSON: We have a range of view of 28,000 of in-migrants

                in the next 10 years overand above the net new entrants into the labor

                market, from,existing populition. This assumes, even on the high side,

                that the rate of growth in jobs in the next 10 years would not.be much

                more than half what it was in the last 10 years.

                     MR. WEBB: This also assumes no impact from off-shore drilling

                or anything in the oil industry.

                     MR. THOMPSON: Not at al I, we simply don't know. We have indicated
                here that we think that the Stat.e needs moreinformation before a
                projection can be made...
<pb n="315" />

                                                   16

                   REPORT BY THE LAND USE AND COMMUNITY DEVELOPMENT COMMITTEE

                        MR. LARSON: Unlike Spencer, I don't think I can assume that

                   youlve all read this, because I didn't get Ey copy of this report

                   in the mail yet, although I am somewhat familiar with it. However,

                   I won't read it to you. I'll just try to get some of the high

                   points. As you can judge, Spencer's Committee was dealing primarily

                   with the question of how much. Our Committee was dealing with

                   questions of what kind, where, and in what form. Essentially, the

                   Economic Development peeple were dealing with facts. I think our

                   Committee dealt, and in some depth, with issues. If @conomic

                   forecast is an inexact science, political policy-making, with

                   respect to land use, is even more so. I think you will realize

                   that when you do have a chance to go through our report.

                        Essentially, what we set out to do, in our Committee, repre-

                   sented by a broad spectrum of interests, both public and private,

                   throughout the State was to create a model for Community Development

                   and Land Use for the future. We did this, essentially, through the

                   process of discussing and identifying the various issues on land use

                   and community development that the individual members of the

                   Committee were dealing with, saw, and could articulate in a form

                   usefulfor discussion. From that process of discussing the issues,

                   we set out to develop a set of positions or policies that the State

                   of Delaware might follow in the next 15 to 20 years, that if implemented,

                   through various controls, at the local and State level, would

                   set the kind of development patterns for our communities, both

                   developed and currently undeveloped, that the members of the Committee

                   at least wish to see.
<pb n="316" />

                                                  17

                       We also, from that point, developed a set of programs and tobls

                  for implementation, for consideration by the Commission in the event

                  that the policies were adopted. I think it would be fair to say

                  that the consensus of our Committee was that our concern was essentially
                  with quality rather than quantity. What were the community develop-

                  ment patterns going to look like? What will our towns and cities and

                  rural areas in Delaware look like? We were dealing essentially with

                  physical things; 'things that one can see,.such as a farm, an office

                  building, or an airport, or a marine terminal. These are things

                  that can be identified physically. They can be measured. They.can

                  be controlled through land develop!nent legislation.

                       Three major streams of thought emerged from this process. First

                  of all, a strong feeling that Delaware should protect its prime

                  farm land in the future, for a variety of reasons, not only because

                  it's good farm land,but also because it represented almost an

                  industry in this State, that perhaps for many years has been overlooked,

                  but nevertheless a very important segment of our economy.

                       Second, there was a strong sentiment to find a way to standardize

                  our land use controls and regulations. Not only standardize from

                  the standpoint of the rules and regulations themselves, but standardize.

                  from the point of policy, if you will, as to what land uses were most

                  appropriate to what sections of the State or individual portions of

                  the State. One of the recommendations coming out of this consensus

                  is that Delaware consider the development and adoption of a Statewide

                  land development code, which would be a guide to be used by local

                  governments in their responsibility of actually controlling development.
<pb n="317" />

                                                     18

                         Thi,rd, and perhaps most important of those consensus reached
                    in our committee, was the position that in Delaware we should look

                    for our future development to take place essentially around the

                    systems'that exist on the ground today, our existing towns, our

                    existing cities, our exisitigg settled areas, to build on the base

                    of utilities, transportation facilities, government centers, other

                    activities that are already there; to avoid, if possible, the

                    phenomenon of suburban sprawl, which has become so familiar to us

                    in the suburban areas of our State over the last 20 or 25 years.

                    This consensus, in turn, has lead to policies. For example, within

                    our Industrial Land Use category, we should first examine the potential

                    development of existing industrial sites and buildings that are within

                    a city like Wilmington. There is a very close correlation, Ithink,

                    with th is thinking and the consensus within the Economic Development

                    Committee.

                          That, briefly, is where our Committee came out. We were not

                    unanimous, as you will see Men you read.this report. We know full

                    well that the counties are not going to be particularly pleased with

                    additional controls, perhaps, imposed at the State level, and we

                    fully expect that the  eounties will resist this position very

                    strenuously within the Committee. But, I think it's a    good debatable

                    point for the Commission to get into. We were examining within our

                    Committee, and we will examine it further prior to the meeting of

                    the Commission, the question of the proposed American Law Institu   te

                    Model Land Development Code. Some of us feel that that has some

                    promise for consideration by Delaware and,we will probably be making
<pb n="318" />

                                                  19

                  some recomm endations on that to the Commission before it winds up

                  its work.

                       I will be glad to answer any questions.

                       CHAIRMAN BIONDI: Your Committee, then,  will continue to meet

                  and you will come up with recommendations to the Commission with
                  repsect to that one area (the ALI Land Development Code) which is

                  mentioned in your report for possible digestion. Has your Committee

                  given any consideration to the recent study which has been done by

                  the Delaware Society of Professional Engineers in which they are dis-

                  cussing, in connection with but apart from, the Coastal Zone Act?

                  They are talking ab@ut a comprehensive statewide land use plan.

                       MR. LARSON: No. Their report came out just about th  e time we

                  wound up our work. This would be of sonsiderable interest to the

                  members of our Committee and certainly, the Commission itself would

                  want to sonsider these recommendations.

                       MR. WEBB: Has the Committee considered at all the potential

                  impact of the Federal Legislation that is-proposed on energy siting,

                  which requires each State to develop a Comprehensive Plan for the

                  siting of such things as power generating gacilities, pipelines,

                  etc. - anything having to do with energy generation, transfer, or

                  management because the kicker to that is that if the State does not

                  do such a development plan the Federal Government steps in and

                  imposes upon the State.

                       MR. LARSON: The answer to Skip's question is no. However, there

                  is a proposed State policy here, with respect to the question of

                  utilities, and terminals,.which in effect, says that the State of
<pb n="319" />

                                                    20

                    Delaware should maintain the final sign-off on location of these

                    facilities. Essentially, we feel that Delaware should be on top

                    [Page 16). "Delaware should assume regulatory and operational

                    control over any future sites or rights of way for marine terminals,

                    bulk transfer facilities, or utilities, including pipelines."

                        Now, that's a big can of worms, but it's a great big chore

                    and it probably could not be done with the capabiltties that we

                    have on site in Delaware, within our Government structure.

                        CHAIRMAN BIONDI:   I would like to suggest that your Committee,

                    in connection with it's work on the ALI Land Development Code, also

                    review that report by the Delaware Society of Professional Engineers,

                    where they have proposed Statewide Land Use Planning. We will provide

                    you with copies of that report.

                        MR. WEINER: Once again, my question with regard to coordination

                    with the 208 Land Use Study and Results.

                        MR. LARSON: We had the reso  urce person from the 208 Program

                    serving with our Committee and they have made some comments, parti-

                    cularly with respect to the question of water supply and sewage

                    disposal that have been considered by the Committee. In so far as

                    the Industrial Study goes, the resultsof that study were not

                    available to us at the point which we were putting down.our final

                    thoughts on industrial policies. I don't think there  are any

                    basic contradietions, however.

                        MR. BRYSON: I have some questions on Page 11 of the report.

                    Item 3, what do you call public shorelines? Is.this a public owned

                    beach or are you referring to a public use area?
<pb n="320" />

                                                  21

                       MR. KUENNEN: I think that was the consensus of what we were

                  talking about, not to use funds in those areas that were not operated

                  by the State.

                       MR. BRYSON: How about public use areas? Just for the record,

                  there are no funds being spent on any beach other than a public use

                  beach area right now. The only beaches we are spen ding money an

                  are the ones that the land owners will give us an easement for

                  public use of@that beach as a public beach.
                       MR. LARSON: So the State may have already developed this policy.

                       MR. BRYSON: Somewhat. It may not be as far as you want to go,

                  and it's not as far as I'd like to go.

                       MR. LARSON: This  all started when we began talking about what

                  happens every 15 years or so when somebody'i beach gets washed out

                  and the Corps of Engineers and the State has to build new jett4es

                  orsomething.

                       MR. BRYSON: It is extremely frustrating, and I would,welcome

                  any advice or comments. The next question is on the implementation

                  at the bottom, of the page. We can't get enough money out of boats

                  and park fees to even maintain boat ramps and park fees at this p6int.

                  Your goal is well intended, but the source of revenues are not going

                  to work.

                       MR. WEINER: I had two questions that go to some broader policies.

                  There are recommendations here that suggest the interjection of the

                  State in the local planning and land:use policy questions. Are there

                  any conments from your Committee about the whole question of those

                  powers which have been delegated to the counties or to the local
<pb n="321" />

                                                   22

                   municipalities versus those that the State, recognizing that the
                   police power under which we do planning and zoning is the power of

                   the State, which it has by law in many instances delegated to other

                   municipalities or counties. There are  suggestions here which indicate

                   that the direction of the report is asking for the reassumption of

                   some df some of those powers by the State and outlining that they will

                   be removed from the jurisdiction of the municipalities or local forms

                   of government, including eoun ties. Is there any place in which

                   those powers and that kind of structure, which would accompany your

                   recommendations, has been thought through or that we will get some

                   kind of an outline on it.

                        MR. LARSON: Only so far as there is 'sentiment for the development

                   of a Statewide Land Development Code, which we presume would supercede

                   all existing delegations of power. It would deoegate power, no

                   question about it, but it would probably supercede the existing

                   planning and zoning legislation.

                        MR. WEINER: Are you proposing the addition of another tier of

                   regulation, or are you selectively taking back certain power s to the

                   State and reducing the powers of the municipality or of the county

                   which it currently has. I think there are two paths here.

                        MR. LARSON: I can't answer that because I think what we're

                   really asking is that, if the Commission agrees that we should go

                   for the development of a Statewide land development code, we would,

                   in effect, be starting with a clean piece of paper. The legislature,

                   presumably, with the input from the various other political powers

                   that be in this State, would make a decision and would make a decision

                   on what was to be delegated.
<pb n="322" />

                                                  23

                       MR. CONAWAY: That is not  the impression that I had. The

                  impression that I was left with as a membbr of the Committee was

                  that this would be another level - a code that would be used to

                  make surethe counties and the municipalities  follow these set

                  patterns but that it would be superimposed over the whole thing.

                       MR. LARSON: It's possible that it could work that way. For

                  the members of the Commission, as you can see, there is some
                  considerable uncertainty about how this would work. I don't think

                  any of us is an expert at it at this point., We do feel, however,

                  that there is little coordination at the present time between the

                  land development policies of our local governments and what may

                  be'the merging Statewide policies on Community Development and Land

                  Use. These emerging policies may represent an axis of power that has

                  not existed in this State for many years, an axis of power that will

                  wed the agricultural interests and the very urbanized interests along

                  with conservationists. It may represent a stream of thought that  will

                  lead to more power going to the State government.

                       MR. WEINER: I just want to make the record clear on that. I'm

                  holding no grief for  for example New Castle County's Mickey Mouse

                  system of land use control or zoiigg - and Mitkey Mouse Is for the

                  record - in case anybody has any illusions on it. I.simply think

                  that this is oneoof the areas that the Delaware Tomorrow Commission,

                  if it's going to perform the service, needs to deal with and to reconcile
                  and to make clear what it is that it's looking for, on the other hadd,

                  where the local and municipal governments and the county authorities

                  have their position. My second question, which is found on top of
<pb n="323" />

                                                      24

                    Page 11, relates maybe to what Mr. Rygn was atking about before, was

                    do I understand the statement that Delaware should continue protection

                    of coastal and estuarine areas throughout the State, as a flat

                    statement, to be an endorsement of the current coastal zoning practices

                    and law. Is that what it's intended for?

                         MR. LARSON: I think so because earlier we had proposed some

                    modifications, and  the majority of the Committee felt that the

                    existing law-should remain.

                         MR. BRYSON:   In that vein, is the feeling that the Coastal Zone

                    Act, as it now stands, is a great act?

                         MR.-LARSON:  Certainly as a pioneer effort in trying to manage

                    a Coastal area, the Delaware Act is a landmark and it may go in the

                    National Historical Register someday, but there are some who feel

                    it can be even more effective and even more closely tied to some of

                    the economic policies of the State than it is today. However, our

                    Committee felt it should continue as tt is presently written.

                         MR. WEBB: Mr. Larson, when you say should continue "protection

                    of coastal and estuarine areas throughout the State" there are

                    estuarine or wetland areas which are not within the Coastal Zone.

                    In other words, are you talking about the Coastal Zone and the greater

                    area of wetlands or estuarine lands, for   example, the Chesapeake drainage

                    area, which is not in the Coastal Zone,   the Nanticoke River, for

                    example. I don't think that comment i   s specific enough. I think

                    it ought to be broader.

                        -MR. COOPERSON: I'm not quite   sure  that I understand Mr.
                    Webb's,point when he says coa.sta.1 estuarine areas. Cypress Swamp
<pb n="324" />

                                                   25

                  is, as far as I know, not an estuarine area, it is a fresh water

                  swamp. I think you all realize from what's being said here there

                  was a good deal of differences in the Committee. We were concerned,
                  as people on the outside, not to try and write laws (there were
                  Hyyers on the Committee but that wasn't their function there) but

                  to establish a  policy. As I understoodift, there was no question

                  that there might be amendments to the law, but essentially the strong

                  protection policy for the coast and the coastal wetlands was what

                  was desired.

                       MR. WEBB: I'm talking about the interior wetlands that are

                  not in the coastal zone. I am saying th  at it's not broad enough.

                  I'm not attacking it on it's narrowness.

                       MR. COOPERSON: There is another portion of the statement of

                  the Land Use Committee that deals with natural resources other than

                  coastal areas, but we felt that this should be addresed separately.

                       MR. BRYSON: The current Wetlands Act covers what youtre

                  talking about, Skip.

                       MR. WEBB: That's right. The borders of the We   tlands Act are

                  different from the borders of the Coastal Zone Act. Which are   you

                  talking about--the larger or both? I mean John can show you maps with

                  quite a lot of dtfferences between the Coastal Zone Act and the Wet-

                  lands Act, right John?

                       MR. BRYSON: The Wetlands Act does include the Cypress Swamp

                  and some of the larger swamps. I don't think the marshes a  re covered

                  by the Coastal Zone Act.

                       MR. WEBB: There are some areas.in lower New Castle County that

                  would be  in the wetlands.but are not in the coastal zone.

                       MR. LARSON: At one point, we had a whole shopping list of

                  natural resources,'but the problem was that we.kept adding them.
<pb n="325" />

                                                     26

                   it reached the Point where we.were afraid wedd leave something out

                   so we just didhft put all  of them in specifically. In fact
                   one that we didn't put in  was.swamps, as a matter of fact, we.
                   had about everything else, including ponds,

                        MS. SLIGHTS: I think the intent was, though, that these

                   things be included, that it was an all-inclusive policy.

                        MR. THORN: As a memb  er of the Committee, I would agree with

                   that statement.

                        MR. WEINER: I still am not clear. I'm raising a question...not

                   arguing a position. The sentence says "Delaware should continue

                   protection". Is this a flat-footed statement of unqualified support

                   for coastal zone, and wetland, and swamp, and flood area legislation

                   which currently is on the books, or is this a statement that Delaware

                   should protect those areas? The word "continue" has got me confused.

                   Now, it's either'one or the other. I would ask the Committee to refine

                   this to say what  they mean,,because. the Economic Development Committee

                   apparetnly bowed  out on that subject, and it would seem to me that this

                   Committee has to  do it, or somebody has.to.do it,,and I think that at

                   some point it is  a critical policy question for a..State which  is no

                   more than 10 miles  wide at some  point where two miles. or 20% of the
                   width of the.State  is affected by,a single piece of legislation.

                   I think we ought to  be very clear on what the policy recommendation

                   is from this Committee.

                        MR. WALTON: I want to   give our Chairman somessupport,   Mr. Weiner,

                   before he has to answer that  question. @One of the reasons   that this

                   area has not been more  specific was  just the,limited time with which

                   we had to work.   Tha't.'s the main reason. .-We could.have spent hours

                   and.hours on this  one subject and maybe  come up with a  full page state-
<pb n="326" />

                                                         27

                     ment. which would have brought a lot of controversy. You notice

                     there were some of us who did not vote, of which I am one,        and there
                     were some of us. who voted against it. I'd like to point out the reason
                     being is just what you're mentioning, Mr. Weiner, that the policy

                     statement is not knexplicable, but it leaves a lot to be desired. This

                     is an area which we thougt the full Commission should be faced because

                     our sub-committee was not going to resolve.the whole thing anyway.

                     About the Wetlands, Act,,add all the other Acts, and the Coastal

                     Zone Act, there are those of us who are of thlac-,sdhool of thought

                     that you can't dvaw a line at 20% of the State'. you have to talk

                                                                    -school of thought, how are
                     about the whole State. This being a major

                     you going to separate the 20% out of all the Coastal Zone.          There are

                     those of  us who think.the Coastal Zone runs clear to the        Maryland. State

                     line,.and  there ave those who wrote the     law who think it   stops at  the

                     Delaware Bay. These are things. that are      not answered and   we couldn't
                     vote for a policy statement.

                          I have a question Mr. Bryson: Is State policy now not to pay

                     money torestore beaches unless they get access to beaches?

                          MR. BRYSON: That's right. We       haven't spent any money     on'a beach

                   @thlt the owner didn't give us right      of way for public use.      That is

                     an unwritten policy, one that I have been carrying out, not.something

                     that the law dictates.

                          MR. GILLIAM.: I have a direct     response to Mr.   Weingr's poi6t. As
                     a member of that Comittee,.it is not my       understanding that that was an

                     enforcement of an existing Iegislation.       I agree that,that should be
                     made clear and perhaps the Committee.ought to work on        it.
<pb n="327" />

                                                     28

                         MR. RYAN: It seems to   me that when the.Delaware Tomorrow Commission

                    was appointed - when it was  recommended by the Governor to have such 6

                    Commission   the reason for  tt was the controversy of the Coastal

                    16ne Act.

                         CHAIRMAN BIONDI: I don't accept   that. I think we're concerned
                    with large scile problems of what this State's going to look like

                    in the future.

                        MR. RYAN: This is my opinAin. My opinion is that the §overnor

                    ,felt thAt something ought to be done because we're baving the urns

                    up and down the State on the Coastal Zone and he decided to draw

                    up this Delaware Tomorrow Commission. But there's been very little

                    effort put i.nto one of the most controversial subjects that have come

                    up in the State of Delaware in the past two years and that's the Coastal

                    Zone Act. This Committee says they didn't put that much effort into

                    it, the Economic Development Committee says they didn't put that

                    much effort into it, I don't know what the next Committee's going to

                    say, but it has been a problem in the State of Delaware. It's been
                    a recognized thing throughout the nation that the State of Delaware is

                    an anti-industry State. If we don't have that recognition, we're

                    .certainly putting a.lot of effort into the Future magazine as far as

                    putting ads to try to get people to come into the State, we're putting

                    effort into this, and I think there ought to be some effort by these

                    three Committees into the Coastal Zone Act to see. Everybody has

                    said that we don't know.

                        CHAIRMAN BIONDI: I think the Coastal Zone Act is a specific

                    problem which the Commission is,goingto have to address and an
<pb n="328" />

                                                    29

                   important problem. But, overall as I look at the report of the

                   Economic Development Committee, which is concerned with -industry

                   throughout the State, all forms of industry, and as I look at the

                   Land Use and Community Development Committee report, which is really

                   talking about a set of policies for all levels of governmentt for

                   all kinds of residential, commercial, and industrial groups, really

                   the quality of the State we're going to live.in, and as I look at the

                   Cost of Public Services Committee report, I don't think that this

                   one issue has been treated badly. I think it's probably been given

                   the attention it deserves up to this point in the Commission's

                   proceedings.

                        MR. RYAN:  Mr. Thompson said earlier that we really can't do

                   too much on the Coastal Zone because it takes a little more effort

                   and a little more meeting, but one of the reports of the Economic

                   Development Committee, on March 13, says the Coastal Zone Act

                   should be rewritten.

                        CHAIRMAN BIONDI:  That was a draft of that Committee's report.

                   Before the Commission  is through it's work, we're going to have to

                   address ourselves to this problem. 1here are a broader range or

                   problems and I wouldn't be spending my time on this matter at all

                   if that were the only issue. It's an issue that can't be ignored    but

                   some of the things which are being suggested here are very fundamental

                   to the future of the State and are ofaa broader context.

                        MR. RYAN: I agree with you. However, the question was.brought

                   up about the Coastal Zone, not just by me, but by other people in

                   this room and they said that it'L'such a broad issue that we haven't
<pb n="329" />

                                                   30

                   enough time to do it. I'm saying that maybe there ought to be

                   some effort put into that one particular.subject.

                        CHAIRMAN BIONDI: Well, I think before the work of this

                  .Commission is over with, you're going to hear more of it.

                        MR. WALTON:  Just to set the record straight, Mr. Ryan, I

                   said that we did not spend a disproportionate amount of time on

                   the Coastal Zone. I felt that we spent a lot of time on the

                   Coastal Zone. I'felt that we spent a lotof time on the Coastal

                   Zone in our Committee. The Chairman should speak to this issue.,
                   I think the time spent was in proportion to.the concern of tssue

                   that it is and it took up more time, on our Committee, than any

                   other part of our work, just to set the record straight, because

                   somebody's got the idea that we shortchanged them.

                        CHAIRMAN BIONDI:  I agree with Mr. Weiner's position with

                   respect to the recommendation ought not be subject to 100 inter-
                   pretations, the recommendations ought to be laid out, but I would

                   like to see it done in the context of considering, not just the
                   Act itself, but considering the American Institute Land Development
                   Code, considering the report of the Society of Professional Engineers,

                   which recommends Statewide Land Use Planning. Mr. Walton alluded

                   to it a bit when he said that he thinks the Coastil Zone extends

                   to the Maryland Border.

                        MR. WEINER: 'I want to make this point, because I've now

                   heard the ALI State regulations mentioned.so many times, for fear

                   that someone would say that for the record,.nobody raised the

                   Spector of a monster of the undesirability, conceivably of the.ALI
<pb n="330" />

                                                      31

                    regulations, let me please introduce    the fact that, until  youlve

                    read that voluminous piece or document, and have examined     it

                    carefully, and I don't know who in this room has, that we     should

                    proceed very cautiously and clearly to understand whether     we want

                    to impose that on our State, and not to make the assumption that,

                    simply because the American Law Institute spent seven years preparing

                    the document, that it is either useful or necessary document in the

                    State of Delaware. I just put that caveat out because it's been

                    mentioned-so frequently that, if there isn't,some voice raised,

                    one might assume it was gospel.

                         MR. COSTA: I would like, for the recordi to express my concerns

                    with the word "to co ntrol" because I think it is a very conflicted

                    and very stnsitive word. It can be good, but it can be very

                    stifling. But the three counties, with their differences and      with their

                    competitiveness, I think it's a very good thing, but the waste of

                    separate effort, time, and money, to a common cause     is bad.   For
                    those who rule or make decision, it is.very healthy     to delegate authority

                    because if either the county, or the State, or the federal government,

                    have absolute c ontrol, and this is my   concern (control can be
                    anything relative) it could turn tossom6thing that     in other places

                    is called tyranny, or dictatorship of sorts. I, unfortunately, have
                    on.ly been present at two of the meetings of Mr. Larson's, and I wasntt

                    aware of this tendency to control.
<pb n="331" />

                                                    32

                COST OF PUBLIC SERVICES COMMITTEE

                     MR. KREIGER: I'd like to change the format of the presentation as

                given by the other Committees, I'd like to have my Vice-Chairman, Dr. Latham

                and Dr. Brams (University of Delaware staff), aid me in giving this pre-

                sentation. Our committee had the task of analyzing the. Cost of Public

                Services with respect to our State, and I can happily report that we

                achieved a first with the three Committees, as we have no dissenting

                opinions and we don't have any minority reports. Ourreport is a factual

                report. We won't have any controversy over it. The Committee had

                approximately 14 meetings, which count the sub-committee meetings and

                probably involved a mininium of 800 to 1,000 hours of work. The final

                report consists of about 50 pages, which Mr. Keifer will send to all the

                people who have not received a report today. The report is basically

                broken down into two areas. One has to do with the revenue services

                for Delaware as'a whole and Delaware as-a whole is broken down into

                subcategories of the State of Delaware and then the local portions,
                which is further broken down into the three counties of New Castle, Ken' t

                and Sussex, and then the City portion (we used the three major cities--

                Wilmington, Newark, and Dover.) We couldn't obtain the information on

                the smaller localities and the Committee's feeling was that they were not

                of major significance so that what you see in the report really is the

                main gut of what th e costs have been. The revenue portion, which we

                referred to as Section A is broken down further with respect.to the per

                capita figures. We made another analysis   showing what the portion of the
<pb n="332" />

                                                  33

                revenues are broken down by Delaware sources and by external sources.

                What we mean by external sources is the federal revenue sharing funds,

                which have a large impact on our State and also we considered as a special

                category, the franchise taxes, which are rai.sed by the State of Delaware,

                and which we felt should be dealt with separately because of the fact

                that most of that revenue_is not produced by Delaware sources and is

                sort of external. The figures with respect to the revenue will be commented

                upon, after I finish my opening remarks, by Dr. Latham. The Cost of

                Public Services, which we refer to, in our report as Section B, has been

                broken down in a format which we felt was most important because it's

                never been done before in the history of the State, and it had not been

                available, andthose figures are broken down on an operating basis, and

                a capital expenditure basis. Those number, which are presented in

                Section B, are very significant and meaningful. Again, comments pertaining

                to this section will be given by Dr. Brams, who headed up that section.

                     I might add that we had approximately 35 or 40 other reports before

                we adopted this format, which is on a functional  basis so that you can

                see, for example, the cost and the expenditures of our Government (when

                I say our Government--that's the overall encompassing title of  the State

                expenditures, the County expenditures, the major cities expenditures,

                and education expenditures.) Education, I might add, is today about the

                biggest expenditure that the State has.

                    We didn't for internal purposes, make any comments or review of the

                tax policies of the various functions of the State or the operating agencies

                within the State or comments on whether or not, as some of the other Committees
<pb n="333" />

                                                 34

                did, the income tax rates are correct or not correct.   What we in effect

                analyzed was all the income and/or revenue sources of the State from

                1968 to 1973 and we also analyzed all of the costs  for the same period

                of time 1968-1973. The .1974 reports, when we started,  were not available,

                and they are not included in the report.  We would also like to bring

                forth to those present, and to the Commission, the fact. that one of the

                things that will stand out and is app arent,.which is something that cer-

                tainly ought to be considered is the fact that the State of Delaware

                doesn't have large surpluses, as some other States in our Country do.

                Just be coincidence, there's an article in lastnight's paper which refers

                to the fact that, of the fifty states, Delaware's in the group of

                approximately six or seven that don't have any surplus reserves and can't

                dip into monies that have been built up over the years. We are living on

                a hand to mouth basis.

                     CHAIRMAN BIONDI: Asked for an explanation of how to read Table A

                of the Committee's report.

                     DR. LATHAM: In Section A, the table presented there are simply an

                attempt to look at where the revenues that the State has generated at

                both the State government level and at the local government levels over

                the last five years. Contrary to the Economic Development Committee,

                this Committee felt that the last five years would give a sufficient picture

                of the history of revenues. If you look at these,numbers, you can see

                very dramatic changes in this short period of time, and going  back 20
                years for examinations of State revenues.and expenditures-is  not as useful
                as.a similar. process would be for employment analysis.

                     The first table gives the totals for revenues by  all levels of

                government, including school districts, with the exceptions that aren't

                already noted that excluded are the small municipalities and   any.other
<pb n="334" />

                                                 35

               governmental agencies that we might not have   been aware of that receive

               revenues. The top line in each.table refers    to the entire State, and

               the title is Ma  jor Delaware Revenues, just to indicate that it's not

               really quite total, but it's very close to being total revenue. Then    the

               table breaks down the major revenues to those received by the State

               Government, and those received by some of the major local governments.

               In Table 1, general  and special funds were combined for one.total. This.-

               is one possible total for State revenues that you can come up with.

               In this Committee's  work, there has not been an attempt to reconcile

               everybody's different revenue  numbers. These are based on the State   budget

               'and include both general and special fund revenues.

                    MR. BRADFORD: With one major exception, the attempt here is to show

               revenue in relation to expenditures. This is an attempt to take revenue,

               regardless of where they come from, that end up as expenditures, on

               Part B. It is an attempt to refine receipts of money, of some sorts,

               that are used as expenditures. Therefore, you will not find these figures

              .anyplace else. The backup documents do have a breakdown of these figures.

                             M: There is a kind of consistency in these figures. The
                    DR. LATHA

               fact that local governments expend some funds that are received by the State,

               is accounted for here,by simply noting that they are,received at the

               State government level. This is supposed to be reflecting point of receipt

               of revenues and not point of expenditures of revenues. So, we have a

               breakdown that goes from S tate go vernment down to the three county

               governments, and the three major municipalities and the school districts--

               within the counties.
<pb n="335" />

                                                 36

                     The following two tables break them down into those that are basically

                Delaware-controlled sources, and those that are beyond the control of

                forces inside of Delaware.

                     All franchise taxes are excluded from Delaware sources, even the

                franchise taxes of corporations that do business only in the State of

                Delaware. It can be argued whether these funds are beyond the control

                of the State or not, but you can also argue that additional funds ought

                to be considered the control. That's the position the Committee took.

                     MR. WEINER: I think what you were trying to do in your methodology

                was to take a look at the Di vision between what you can raise from local

                sources as distinquished from what comes in from external sources. I

                think that the question is: is what you did clear enough to be able to

                give you enough to make some policy decisions on?

                     MR. WEBB: Expressed interest   in seeing a breakdown of the totals

                in order to see how they were reached.

                     MR. BRADFORD: Probably the greatest difficulty this Committee had

                was to reconcile 75 different methods of recording revenues and expenditures.

                We had to chose. The figures are available. We ask you, on faith, to

                accept that we did our homework, and accept that these figures are   in

                the order or magnitude of the expenditures and the revenues of the  State

                of Delaware. They may be  off by 3-5 percent.

                     DR. LATHAM: Went on   to explain the breakdown of the tables in

                greater detail.

                     A lengthy discussion followed on the detail  of the tables in the

                Committee's report.
<pb n="336" />

                                                37

                    DR. LATHAM:  These figures are-not saying anything   about Delaware

               Tomorrow. They are simply saying this is what's been happening over the

               last few years.  This particular Committee was really unable to say much

               about Delaware Tomorrow with respect to cost.and revenues, without some

               knowledge about the form of growth in the future; how many people are

               there going to be, what kind of industries are there going to be, and   where

               are these people industries going to be located, because that will

               critically effect both revenues and the expenditures.

                    It would be dangerous to attempt to project State revenues on a per

               capita basis. Presented here are revenues on,a per capita basis, as they

               exist right now, but I do not feel it would be legitimate to take the

               State's projected population figures generated by the Economic Development

               Committee, because some revenues are not tied closely to population and

               other revenues are tied closely to population.

                    Care also has to be taken in trying to add up  the per capita figures.

               The only people for whom per capital expenditures are kept are the residents

               of the three cities. To add together revenues for a person living in Wilmington,

               you add up the City of Wilmington revenues, New Castle County revenues,

               and State level revenues and find out what  the total revenues collected

               for a resident of a City is. But it would   be dangerous to say that that

               represents the revenue collected from the  residents in those cities, be-

               cause we know that alot of the revenue payments, in the case of Wilmington,

               come from people outside the City.

                    There is also a danger in trying to compare some of these   numbers

               for Delaware and similar figures for other States, because of differences

               in levels of service provided and also differences in the kind   of govern-

               ment organization that exists in other'States compared to Delaware.
<pb n="337" />

                                                    38

                      There are just some cautions in trying to do too much with what's

                 been presented today.

                      CHAIRMAN BIONDI: As    you look at what future costs are going to be,

                 will you be using the   same population statisti.cs, that the Economic

                 Development Committee   is using here?

                      MR. KREIGER: We'll    use whatever is determined   to  be a valid number

                 in the future.

                      MR. WEINER: There are two or three things that      are lacking, at this

                 point, to enable the Commission, as a whole, to move     forward. One is that

                 welve got general revenues or totals of revenues by area and by number

                 of years, but the sources haven't been done. I think you need to look

                 at the sources. Basically, the Delaware Tomorrow Commission is going to be

                 looking at whether we make decisions or recommendations that there should

                 be growth, orlack of growth, then it's going to effect the question of

                 what kind of policy flows from who pays for what public services. At that

                 point, you get into the population projections for the future, or on a

                 per capita basis or  otherwise. While this is an excellent start, I think

                 the Committee has not yet tackled the question that we're going to have
                 to be confronted with. They have     not tackled it because I wo6ld think

                 that the other two Committees have to set down some kind of      policy criteria

                 for this Committee to begin to project into the future and      I think there

                 is that difficulty of making those projections, whether it's for population,

                 or sources of funds, or the kinds of public service or public interest

                 expenditures that are needed. In a sense, their work is not completed,

                 for those reasons.
<pb n="338" />

                                                    39

                      Section B of the Committee's report was explained in great detail

                by Dr. Brams. He explained that Tables 1, 2, and 3 are really all the

                same data  presente d in different ways.

                      MR. BRADFORD:   The attempt of this Committee was to    get a data base.

                Admittedly, it is a   first step, even as a data base, and    we will do what

                we can to refine it   and we will welcome your questions and suggestions,

                but the major contribution to the Commission's work has not even begun,

                as far as we're concerned, and probably shouldn't be.done until we have

                some guidance. Any trend lines you see here in the past may        well be changed.

                Our job is going to have to be to take the best estimates of       the kind of

                people'who will be-furnishing income, and thekind of expenses and where

                they take place, before we can come up with costs, or where those funds

                are coming from, or what will be the impact upon State government if

                the average income of people goes down in relation to the present dollar

                level. Where will the income tax     be? This is the kind of information

                we will have to spend our time on.
                      MR. MO RTON: I would like   to cl'ose on a note of caution, as you take

                .this material home and attempt   to look over it more closely. There is

                a thread that runs through all    of our presentations today which makes

                extrapolation of data a risky     venture, at best. As you look at this,

                you'll see the capital   expenditures are rather erradict and are much     more

                closely related to the   pattern of growth. By pattern I mean, timing, location,

                and type. On the other hand, operating expenditures correlate much        closer

                to the overall magnitude of growth. In going through this program,        we have

                established a historical perspective and an analytical method of s       tudy,
<pb n="339" />

                                                  40

                which I think will lend itself well to ca rrying this work further into the

                future when we have the data from the over groups and guidance from

                the overall Commission.

                     MR. WEINER: An attempt by this Committee to try to look into the

                future (on the issue of demand for governmental services) is impossible.

                What I think is important, and wh at I think the Committee and the Delaware

                Tomorrow Commission has.to do, is to lay down some general patterns of

                policy of how we pay for public services. There is currently in New Castle

                County, and with the State Highway Department, the theory that the new

                resident should pay for his own sewer, water, etc. This is a new notion

                of the fact that those of us who get here earlier had our sewers and roads

                built for us, but now the new residents should pay for every bid'of service

                that he gets. Maybe that's the direction that the State of Delaware wants

                to pursue. The general direction of policy of how we pay for public services,

                and where we should be going as a direction, is what I think would be

                important here.

                     On the other side of the equation should be some kind of a tax policy

                which has some equity and is not regressive. I'm not sure that I want to get

                into that or that you want to get into that, but I think that some suggestion..

                which talks about the burden of payments for public services is important

                if we're going to make a contribution to the State or to anybody else. So

                definitive figures, that are based on statistical garbage, are going to

                come out garbage. If they're based in terms of direction.and guidance as

                to where we're going to go, then I think.it has a 'value.

                     MR. WALTON: The thing that's lackingl as a result of the time constraint

                the-Committee worked under, is the major cost of public service s and that's
<pb n="340" />

                                                   41

               the federal portion. The Delaware Tomorrow Commission should be ever

               mindful of the federal costs of public services. It may be too much to

               do, but I think the people who read what this Commission has to say should

               know exactly what portion of their dollar is being spent by the Federal

               government and for what services.

                    MR. RUSSELL: We should keep in mind   that the commitment that the

               local and State governments take on when they get involved in some of the

               federal program is the kind of commitment  that will have an impact o n some
               of the policies weire talking about here.   There has been very little talk

               about what kinds of commitments and how far out they will stretch.

                    MR.,BRYSON: I'm concerned that Delaware Tomorrow is going to be just

               like Delaware Today, unless we take some review of the cost of public

               services today, one versus the other, and try to get a handle on that, so

               we can determine whether or not the cost of each public service is reasonable,

               rational, and if it is.something that should continue. I don't know how

               you do that job.

                    CHAIRMAN BIONDI: One of the things that the Committee is assuming,

               I believe, is that the demand for public services has historitally been

               at a certain rate and is not going to dramatically change. If you want

               to cut taxes back and give everybody refunds, and abolish State programs,

               you're talking about a change in our society, and the way we.do business, which
               is beyond the scope of t he Delaware Tomorrow Commission.

                    MR. KREIGER: We considered making comments with re spect to performance

               by various functional categories, and it was decided that we would not make

               any-comments because it was beyond the purview of what we originally set

               out to do.
<pb n="341" />

                                                 42

                     CHAIRMAN BIONDI: We've got   reports, in their curre nt status, from

                these three Committees. The Economic Development Committee is going to

                meet again and go over the 1953-1973 work force and employment data and

                compare that data with what's been developed in the 208 plan. They will

                prepare an addendum to their report based upon that study. They're going

                to give Toby Ryan an opportunity to argue to them again, or file a

                dissenting report, or revise the majority report - depending on how

                pursuasive he is.

                     Pete Larson's Committee is going to be talking about a land development

                code. In connection with that, some parts of  the 208 study will be looked

                at. They will also take into account the  report by the Delaware

                Society of Professional Engineers.

                     The Cost of Public Services Committee has accumulated some data and

                they have some ideas on how they can approach the future, but we've

                got to try and give them some guidelines, from the other two Committ ees as

                to what the future's going to look like.

                     With that in mind, how should we proceed from this point with the

                Commission in the consideration of these matters? One idea is to ask the

                members of the Commission to submit, within a reasonable period of time,

                their documents with respection to the reports that have been received

                not only with respect to reports that. have been received but with respect

                to other things the Committees haven't considered that they thing should

                be considered. The Committees are composed of members of the Commission and

                non-members of the Commission. I think that we ought to give the people

                on these Committees the opportunity to look at the questions raised by

                members of the Commission. We ought to refer the comments and questions
<pb n="342" />

                                                 43

              raised by members of the Commissi.on'back to the Committee s and allow them

              the opportunity to review those and respond, before we proceed to adopt

              position which will become the position of the Commission in these various

              areas. How do you think we ought to proceed to do this?

                   MR WEINER: I think we need a period of two weeks when we read and

              review and digest what we have received today, and come back with written

              comments. It would seem to me, the Committees should ao back to the drawing

              board on some of their drafts. Until you've taken those two steps you
              can't set a timetable beyond,'it.

                   MR. WALTON: There have been a great many differences of opinion

              expressed here, but if you read,the reports, there is much material that

              is agreed on by the Committees. It appears to me we need some kind of
              a fourth committee that would take what's in the reports now, that has

              been agreed upon, and set that aside, so somebody can start collating the

              kinds of questions that  there are differences on, so when we meet as a

              Commission, we can get to the  hard job of nailing those questions down in

              terms of debate, or whatever is going to happen.

                   CHAIRMAN BIONDI: The difficulty with that,    at this point in time, is

              that there  is substantial agreement, for example, between some aspects of

              the Economic Development Committee report, and the report of the Land Use

              and Community Development Committee. But that only reflects certain agreements

              between members of those two Committees. It does not reflect the common

              agreement of the members of the Commission with the contents of either one

              of the reports. What we   need at this time is a period of comment, I would

              say two weeks for members  of the Commission to comment on the three reports
<pb n="343" />

                                                      44

                 to the Technical Advisory Committee and ask the members of that Committee

                 for their comments on it; then give those comments back to the Committees

                 so they can review those comments and come back to the Commission. It will take

                 a little longer to do it that'way, but it's a substantial amount of work

                 has been done, and we've    got to proceed as fruitfully as we can at this

                 point. If we don't make the deadline of June--then we don't make it.

                      The comments should    be identified, refer exactly to the report and the

                 section you're referring   to and then Submit them to Mr. Keifer, who will

                 channel this information.

                      MR. WEINER: I do think,short of waiting until the other two Committees

                 report, that there should be anexai,0nation of onc, or two questlons that

                 were raised here be-fore.    On the quPstion of thc,            contribution,

                 cn the revenue side, for example, in the cost of puhi ic. service, you have

                 extracted all the federal contributions, on the expendituie side, you've

                 included them.    If you're. goir.(j to make. any kind of qualitativ.e analysis

                 tcward a general policy, the federal shalre has to be separated out.

                 That's one thing we have to know if we're going to look toward policy.

                      MR. RUSSELL: One point of warning, we are concerned that there has

                 been much mention made of the 208 Program. Except for a very few number of

                 reports and projects that have been approved, most of the data that has

                 been coming out of 208 at the present time is draft only and should be

                 accepted as such. We've been warned by the project people and by EPA to

                 keep that in mind.

                      'CHAIRMAN BIONDI: The deadline for getting cononents in to Mr. Keifer

                 will be April 22.
<pb n="344" />

                                              45

                    DR. BRAMS: I have one comment  in the context of the Cost of Public

               Services Committee, you may have very well come to the conclusion, given

               the problematic nature of forecasting revenues and expenditures ten years

               in advance, that you might, in fact, not want to do it. My own feeling

               is that the problems, are such that you could generate a set of numbers

               to fairly simplistic assumptions, but in terms of.the validity or the

               usefulness of the numbers, it may, in fact, not be a very good way for the

               Committee to spend its time.

                    MR. WEINER: As a matter of policy, I think it's very important to

               forecast for the future, or else that Committee will be just chasing its tail.

                    MR. MARKELL: We've-all seen difficulti,es of projecting just population

               and how wrong those projections are. If we try to project revenue and

               expenditures on the basis of population, we are really going to be in hot

               water if we go more than just a little bit down the road.

                    CHAIRMAN BIONDI: But again, we'll probably come out with a set of

               guiding principles rather than a set of numbers to shoot at.

                    The meeting was adjourned at 5:45 p.m.

                                                     Respectfully submitted,

                                                     Dee Burkley
<pb n="345" />

                                            STATE  OF DELAWARE
       DAVID R. KEIFER                        PLANNING OFFICE                         PHONE: 1302) 678-4271
          DIRECTOR                                 DOVER
              Ref.: 1007-1404

                                        DELAWARE  TOMORROW COMMISSION

                                       Minutes of  Meeting of May 27,  1975

                   A meeting of the Delaware Tomorrow Commission was held on May 27, 1975,

              at 7:00 p.m., in the Library of Buena Vista.

                   The following members were present:

                   J. H. Gilliam Jr.                     Dave Keifer
                   Leon Weiner                           Fred Krapf
                   Jay Cooperson                         Representative-Seibel
                   Carl Oldach                           Theodore Ryan
                   Senator Berndt                        Dorothy Greer
                   Secretary Bryson                      Frank Biondi, Chairman
                   Secretary Daniello
                   Ernest Thorn
                   Secretary Hall
                   Carl Russell
                   Joe Conaway
                   John Walton
                   Joann Slights

                   Also attending:

                   Skip Webb                Jane Aughey              William Latham
                   Dave Hugg                'Peggy McLane            William Bradford
                   Henry Ridgely            Rita Smith (attending for Mrs. Marcie Bierlein, but
                   Marvin Brams              not a voting proxv)     Michele Kudish
                   John Morton              Dan Kuennen              Eric Brucker
                   Arthur Krieger           Gerald Cole              William Markell
                                            Spencer'Thompson

                   Mr. Biondi called the meeting to order. He requested a     copy of the Draft

              Report of the Delaware Tomorrow Commission be, distributed to   everyone present.

                   First, Mr. Biondi mentioned the Report of the Economic Development Committee.

                                                                                     9ff A&amp;
                                                               EXECUTIVE DEPARTMENT
                                                                  SHERMAN W. TRIBBITT
<pb n="346" />

                                                    2

             noting that the Committee had submitted its  report on April I and subsequently

             an addendum had been prepared by three members of the Committee. This addendum

             concerned two specific matters: (1) the Coastal Zone Act, and (2) the reduction

             of the inqve tax level (19.8%).and reduction and.change in the capital gain

             tax (100%). These are the two controversial issues within the Economic

             Development Committee.

                  Second, the Land Use Committee filed its report on April 8. Since the

             last Commission meeting, the Land Use Committee met. This meeting r   esulted

             in an addendum to itsreport, dated May 15, 1975. This addendum deals with the

             problem of a statewide land use plan and the recommendations of the Delaware

             Society of Professional Engineers with respect to the Coastal Zone Act.

                  Last, the Cost of Public Services Committee prepared its report and no

             addendum has been prepared as of now.

                  Also, the Commission prepared a preliminary draft report. This report

             was done by Dr. Bill Latham, of the University of Delaware, under a consultant

             contract (between the Univ ersity and the State Planning Office). This report

             was based upon: (1) the Executive Order #43, issued by Governor Tribbitt;

             (2) the minutes of the Commission meetings; and (3),the three reports (mentior3d

             above) of the Committees.

                  The purpose of this preli minary report is to attempt to verbalize what

             is contained in the three Committees' reports. Action on the preliminary report

             of the Commission will be taken at a laterdate.

                  The Repo rt of the Economic Development Committee was first considered by

             the Commission. Mr. Biondi proposed the Commission examine each recommendation

             except for the two issues where disagreement exists. These two issues will be

             considered separately (either by the Committee first, then by the Commission;
<pb n="347" />

                                                     3

              or by the Commission directly).

                   The first part of the report identifies the  economic needs  of the State;

              the second contains the recomm endations to meet those needs.  Mr. Biondi

              suggested that recommendations 1 through 14 be considered b'  the Commission
                                                                          y

              and recommendations 15 and  16 be considered at a later date.

                   Chairman Biondi opened the floor for comments and/or questions from the

              members.

              I.l. (page 1)@: RATE OF POPULATION GROWTH-,

                   Mr. Wiener raised a general question with regard to the approach    to the

              population rate of growth and the way it  is used in the development of  the

              report. It fails to take into account that the critical question is not total

              population but number of households  that will be affected and will reflect the

              character of economic job needs, housing, etc. At presen  t, family sizes  are

              dropping and the birth rate is lowering, but household formations are up over

              1,600,000 annually and indications are that household formations will grow more
              rapidly. Also,, the increase in longevity will reflect on the households of

              senior citizens (although small households). This number will continue to

              increase our,needs for,housing, jobs, etc. These phenomena have been ignored

              in the consideration of needs.

                   Mr. Thompson asked Mr. Wienerwhat would the significance be on    the number

              of households in terms of economic development. Mr. Thompson said that his

              Committee approached the problem in terms,of.job opportunities -as to whether

              or not Delaware would have a more rapid rate of growth to  provide jobs for the

              existing population.

                  @Mr. Wiener explained that if  there is an average household size   of,3.2
              or 3.7 and an average size household that  is rapidly dropp.ing to 2. 7@  or@'2.8 the
<pb n="348" />

                                                   4

             number of jobs or the income producing opportunities.are per household rather

             than per number of.people (this is not con.sidering multiple employment). The

             number of dwelling units is not dropping in the same.proportion as the total

             population is dropping. So, if calculations are based only on population

             (397,600 by 1986) and dividedby 3.2 (or 3.7) a different result will be

             obtained than if the figure of 2.7 (2.8).is used. It was noted in the report

             that the number of jobs would not drop in rel,ationship to thelowering of the

             population in the same ratio. However,,the calculations were only based on

             population figures and not on household numbers.,

                  Mr. Thompson said that the report considered the amount of people who will

             be coming ihtb the market looking for jobs. The number of household is not

             germane. There will be,more women going into the labor force in the next ten

             years than there have been up to now. The thrust was to.anticipate the size of the

             labor force.

                  At this point, some further clarification was made by Mr. Krapf. He felt.

             that more people will come into the job market because there will be fewer

             children who will not be.seeking employment, therefore the ratio is greater.

             Mr. Krapf mentioned the.computations made by Mr. Davis, of.the Diamond State

             Telephone Company, who discussed.this same matter at the last meeting of the

             Economic Development Committee. If at the moment, in a family group, the number

             is 3.7 and it will drop to 2.8 it'means that there will be more people percentage

             wise looking for employment. Th e true,importance is that: do we want the State

             to grow or not.

                  Mr. Wiener took as example the need for telephones,compared to the number

             of people per househould. Mr. Biondi agreed  with the fact that with the same

             amount of people if more households are formed,,there will be more needs for
<pb n="349" />

                                                   5

             telephones -.but he questioned how a greater number of people can be coming

             out of each household into the job market when the women labor force has

             already been accounted for, the younger people coming into the labor force

             as well as people living longer.

                  Mr. Bryson commented that Mr. Wiener's point should  be considered. He

             explained that this phenomenom will be felt in ten years  from now. The trend

             now is 2.8 persons per family unit and the population remaining equal, there

             will be more people employed to keep these family units and this does not

             necessarily mean the woman working.

                  Mr. Cooperson commented that the question is not what the economic impact

             of the greater number of households is - which is clearly going to be different

             but how the number of people seeking jobs is arrived at objectively. The first

             part of the report deals only with the question of how many job seekers will

             Delaware have to deal with, not what the total demand generated in the market

             will be. Obviously, if there are six people and there are two persons per

             household, there is a need for three houses (this is one impact). If there   are

             six people and there are three persons in each household,.there is a need for.

             only two houses (it is a different kind-of impact). Yet, the amount of job

             seekers remains the same.

                  The point that Mr. Wiener was ma.ki ng is that if the population number remains

             the same but the number of people in each household decreases from 3.2 to 2.8,

             each,unit will have to be economically supported.  There will be more.people

             going into the.job market as a result. The question is how is it  measured?

                  The Committe e partly answered this question in making two points, (1)

             there will be more young people going into the labor market; (2) therewill

             be an increasing amount of women seeking empToyment; but two more,points should
<pb n="350" />

                                                    6

             also be considered, the increased longevity and maintenance of increasing

             amount of households.

                  Mr. Biondi asked for Mr. Lat ham's opinion as to how one can measure the

             impact of this factor. Mr. Latham replied that he would have to look into the

             labor force change. At this point, he did not know exactly how the house   hold

             formation affects the labor force participation rate differentially from

             Mr. Thompson's findings. An increase in labor force part  icipation rate will

             occur. The question is will this increase occur at a higher rate because of

             the smaller family size. Mr. Latham stated he was not sure whether it will

             have an impact or not on the labor force.

                  Mr. Brucker said that he did not feel that because there will be more young

             people working, an increase in the female force, and the household size falling

             that these would be major factors in the growth of the labor force.

                  Mr. Wiener said he will accept the figures brought forth in the report, but'

             mention should be made of the decrease of persons within the household unit.

                  Mr. Thompson specified that his Committee used all the resources possible

             to make estimates on the size of the labor force as it relates to the estimated

             increase in the number of jobs in industry. The Committee was not trying to

             make an economic forecast as to how many telephones or how many houses that will

            ,be needed in Delaware ten years from now. That was not the question the Com-

             mittee was addressing and it should not be read in that sense. The Committee

             was looking at the narrow question: How large the labor force will be ten years

             from now to take care of people who will want to work.

                  Mr. Wiener apologized, saying that he thought the Committee was trying to
             consider the broader aspect of economic consequences (consumption of.energy,
             need of homes, etc.) that would affect the economic  well-being. He, therefore,

             withdrew his comment. It was the feeling of a few Commission members that
<pb n="351" />

                                                    7

             Mr. Wiener's comment  should be taken into consideration. Mr.   Biondi noted that

             the impact of smaller  family household on the work force will  be examined

             as well as the impact  of this phenomenom on other aspects of the economic

             considerations.

                   1-2. (page 2):    GROWTH IN DELAWARE'S  LABOR,FORCE

                   No objections or comments were made, except as it relates to Mr. Wiener's

             comments, above.

                   1.3. (page 3:     RATE OF GROWTH IN EMPLOYMENT.

                   Mr. Biondi asked for comments. Mr. Oldach said that there is no real

             method of forecasting.job growth so it was arb.i trarily assumed.that it would

            ,be half the rate, but it might be conservative. The greater growth of jobs

             is solely dependent on the State's economic health.    It is not safe to say the

             rate of growth is going to be half of the present and do nothing about the

             economic well-being of the State. If the State allows the environment to

             downgrade for business, problems will develop.
                   Dr. Brucker mentioned that fixing a figure of 10,000 for unemployment is

             opti mistic. A figure of 15,000 or 16,000 was suggested. Mr. Thompson commented
             that Delaware's unemployment in the last twenty years has been below the national

             average. At this point, Delaware's rate of unemployment is high but so it is

            @throughout the Nation.    There is no sign that Delaware's unemployment rate is

             going to be higher than the national average in the long range. Dr. Brucker

             said that it is unrealistic to expect a 2.9% unemployment rate by 1985. Mr. Biondi

             remarked that the State will be faced with,some.serious problems if its unem-

             ployment rate is constantly  higher than thenational average.    Mr. Bryson noted

             that the Delaware figuresare much more accurate..than those of   the Bureau of

             Census which are about 2%'higher than reported. Mr. Krapf disagreed.with
<pb n="352" />

                                                   8

             Mr. Thompson's assumption that Delaware will remain below the national average

             for the next ten years on its unemployment rate.

                  Senator Berndt said he feels that the unemployment rate in Delaware will

             be higher than the national average within the next ten years because-not

             enough credence is given to the gas and oil shortage without some viable

             alternative to solve this shortage. Delaware does not have the alternatives

             that the other regions have. Delaware's efforts to import have been crippled

             by the programs of the federal government. This will have  an impact on the

             unemployment rate.

                  Dr. Brucker commented that he would project somewhere in the vicinity of

             6% unemployment rate without getting into the question of whether Delaware is

             below or above the national average. If Delaware is to have more young and more

             females into the labor force, then Delaware is more than likely to have a higher

             unemployment rate than the national average.

                  Mr. Krapf agreed with this thoug ht.

                  Bill Latham felt that too much significance was given to the national

             average. It is the composition of the population that counts. The rate of,

             unemployment cannot be divorced from the composition of labor.

                  Mr. Russell asked Mr. Thompson if his Committee considered the impact of

             the energy crisis on transportation manufacturing in relation to the automobile

             plants, and to the building industry in relation to the number of households.

             If these factors were considered, the question should be asked whether there

             would be much disparity between the unemployment figures advanced in the report.
                  Mr.Thompson remarked that Delaware automotive plants are not of the type

             that are the hardest hit, as compared to the Detroit area for instance. Both

             General Motors and Chrysler plants are modern and are strategically located

             in terms of the eastern market. The Committee considering all these factors
<pb n="353" />

                                                     9

              and trends in industry saw no indication that  there would be disadvantages in

              the next years compared to what had existed in the past ten years. The types

              of industries in the State are very.dynamic (chemica.1, automotive, distribution
              centers) and the strategic location of Delaware caused the Committee to believe

              that the.past trend would not change.

                   Mr. Thompson went on saying if the unemployment rate was   much lower than

              the national average, the State would experience in-migration; however, the

              Committee expects that the in-migration will drop down significantly in the

              next ten years but there.will still be enough job opportunities to take care

              of the population already resi ding in the State.

                   Mr. Wiener said two factors need to be considered- He agreed with the

              Committee's statement on page 8, last sentence; however, he questioned the

              relevance of the estimate of 10,000 v. 15,000 .(of unemployed), except to the

              point that the Committee on Cost of Public Services  will need a base on which

              to operate. It does not change this report in any way, except to anticipate

              some additional costs that may be borne because of unemployment. It would be

              prudent         the Commission agreed to a 5%  or 6% anticipated rate and try

              and provide the financial obligation based on,this percentage. If the Commission

              is going to look at supporting unemployment figure of 10,000 v. 15,000, then

              the question of revenue supporting that base is going to be critical,

                   Mr. Biondi suggested that (on page 5, first paragraph), a statement    be

              added to the first sentence, to read: "Even if the national average with

              respect to unemployment were to be 5 to 6%, the Committee's conclusion would

              remain the same."

                   Mr. Bryson commented that if  the Commission is to be concerned.about   the

              cost of public services, underemployment  is more a problem than.unemployment.

              This situation exists,in Delaware  and will continue to  exist in the years to  come.,
<pb n="354" />

                                                    10

                 Mr. Walton asked for an explanation about the balance between unemploy-

            ment and in-migration. Mr. Thompson answered that if Delaware has very low

            unemployment, and hi gh. unemployment exists in the surrounding states, the

            in-migration will increase. If there is high unemployment in Delaware and

            low unemployment in the surrounding states, there will be an out-migration or

            no in-migration.

                 Mr. Walton c oncluded that those Commission members who believe that the

            unemployment rate in Delaware will be higher than the national average will

            prove Mr. Thompson's formula accurate because the in-migration will drop off.

            Mr. Thompson reported that this is one of the underlying issues for the

            Commission. Delaware, in the past twenty years, has been one of the@fastest

            growing states east of the Mississippi. The question is should it continue

            to grow at that rapid rate or will the growth rate slack off?     Just a change

            in the rate of growth of people employed in Delaware (and therefore the total

            amount of people working) hag an impact on how rapidly land values go up. It

            has an impact on how easy it is for people to change from one job to another.

            There are all sorts of economic impacts on the rate of growth. The rate of

            growth for Delaware is dropping compared to the past twenty years (t   his has

            been only for the past two or three years). Mr. Walton made the remark that

            the farming industry (as he puts it: "I am representing one of the lesser

            dynamic industries ...") has decreased tremendously. There aremore farms

            for sale in Delaware than there ever were before. However, Mr. Walton added,

            thatfarming could go.either way in the next twenty years.

                 Mr. Krapf said that the Economic Development Committee came up with a

            problem that has to be looked into in Delaware. Does Delaware wish to keep
<pb n="355" />

              its growth rate at the present level, increase its rate of  growth, or  decrease

              it. The numbers, can change by the attitude of the State.   Mr. Krapf  said he,

              personally, would like to see the State continue to progress as it has in the

              past (up to two years ago), meaning more population, more.and better jobs.

                  The Commission members generally agreed on the findings of the Committee
              regarding the Delaware'iper capita income ranking (pages 5-and 6).

                  The Commission members.also agreed on the comments the Committee made

              regarding the City of Wilmington's special economic and social problems.

                  Mr. Krieger mentioned that no reference was made to   the higher education

              institutions (University of Delaware, Delaware State Colleg e) or to the

              Technical and Communi.ty Colleges.

                  Mr. Thompson explained that the Committee addressed itself only to the

              problem that thE- State should do more in the area of matching the vocational

              training to the job offers. Mr. Russell asked whether the Committee had

              considered the DTCC and the CETA programs being funded  under county and local

              auspices. These programs are heavily funded toward job training. They have

              been in effect for the past two years. If   the Committee's considerations were

              only up to 1973, the CETA programs as well as the work of the  DTCC are not

              reflected in the report.  Mr. Bryson noted that Mr. Russell's  point is well

              taken, except that the work that the DTCC are doing is for base industry. No

              one has geared up toward state development. Mr. Conaway said that the DTCC..

              is doing just that with Sussex County. The-County requests the DTCC to provide

              it with the type of trained people the County has jobs for. Mr..Daniello

              commented-that the CETA programs train people coming out of other occupations.
              It may be wise to wait two years tosee if the  CETA programs are fulfilling
              their aim. It is  not certain that the people  in the CETA program who are  in

              public employment will.remain in public employment.
<pb n="356" />

                                                  12

                 Mr. Biondi remarked that the programs of the highschool/vocational

            schools are the only ones on which the State can count     for the next ten

            years. Mr. Russell said he woul d. like to add the kind of examples the Com-

            mission wants to see, such as the results of the CETA programs (Title I) in

            New Castle County, and the types of results obtained in Sussex County with

            the Delaware Technical and Community College. Mr. Russell agreed to draft

            a few lines on the subject to add to the paragraph on page 7 of the report.

                 Mr. Daniello remarked that the report only refers to highschool vocation

            training; but, in this day, vocational training certainly goesbeyond the

            highschool level. Mention  needs to be made of post highschool training.

            Mr. Biondi said that the Commission will deal with this matter later.

                 Everyone agreed that the State does not have enough diversity in its

            types of industries and is too reliant on.the chemical and the auto industry.

                 On the subject of underemployment, everyone agreed that it is a problem,

            in Delaware. All agreed to the meaning of underemployment (the person who

            is notemployed up to his skills).

                 Representative Siebel asked whether the Committee had considered the

            largest employer in the State:  State Government? Mr. Biondi replied,this is

            considered in the report of the Cost of Public Services Committee.

                 There was no disagreement in the comments on the homebuilding industry.

                 The last paragraph on page 8 was considered by the Commission.

            Mr. Cooperson remarked that the report mentions the loss of old businesses

            and industries and the need for new companies   but what about the expansion

            of present businesses? The Committee must have implied that, assuming a growth

            in the existing businessesi there is a constant turn over of industry and yet.
<pb n="357" />

                                                         13

              ,within the strength of Delaware's existing     industry, Delaware  must look to

               new industries to provide employment.. Mr.     Walton noted that   the Land Use.

               Committee discussed   the matter extensively   and agreed that the one way to

               satisfactorily achieve State growth    is.to  let existing industries expand.

               From a community,development standpoint, it is the most satisfactory way

               of helping Delaware. This, of course, may      be,contrary to the automotive

               industry but expansion of other industries     that are here*no,w'should be our

               overall development goal plan for the next     twenty years. The idea of going

               out and solicit.new businesses is not as economically sound.

                    The matter was left open by the Chairman.

               II.  RECOMMENDATIONS:

                    1. There were different views on the urgency and importance of        saving

               the railroad  service in the State. Mr.    Conaway stressed that the railroad

               service is of primary importance and vitality     to the survival of Sussex County.

               If Sussex County does not have its railroad service, its, economy is finished..

               This was demonstrated during the period of time when the,bridge over       the Chesapeake &amp;

               Delaware Canal was out of order last year.,.Mr..Biondi suggested the       wording

               be changed to read: "I. Anurgent and important ma.       Itter.is        All Com-.

               mission members present agreed.

                   .2. Mr. Biondi asked if it would be      sensible  to  impose on the Division.of

               Economic Development the responsibility to carry.the       permit applications to the
               county and State processes. Mr. Daniello replied that       he has found during

               his tenure that  a potential industrial prospec.t has to     deal through so many

               state, local,  quasi-independent agencies:   that it discourages  many prospects.,

                    Mr. Biondi  said that the Committee recommended on      page 12, Recommendation 5,
<pb n="358" />

                                                        14

             "to streamline the regulatory and     revi ew processes of the State           Would

             it be feasible to go even further.and to have one person in the Division of

             Economic Development responsible for handling the applications?
                   Mr. Bryson replied that no one from the, Department of Community Affairs

             can carry out an application from a given industry into any agency and answer

             the necessary questions. The Department of Communilty Affairs could introduce

             the prospective client to the different      agencies.and coordinate the application

           ---but the Department of Natural Resources     has.to use its experts to see what

             an industry is going to produce.

                   Mr. Daniello went on saying    that he  does not agree with Mr.,Bryson. There

             ought to be one single lead agency in Delaware where prospective industries

             would go to get answers as    to, at  least, what applications and what questions

             will be required of them in     order to proceed with either building, or carrying

             on a business. The Department       of Community Affairs has started   to do a lot of

             informal talking in terms of    coordination but it,is not enough.

                   Mr. Krapf was very eloquent    in showing the,need for   Delaware to-do   away

             with much of the red tape and    bureaLcratic regulatory agencies4     He mentioned

             Virginia for instance, which has     one person.to help the client go through the

             permit requirement   process. He    suggested that Recommendation 5.be much stronger

             in its wording, but he added,     'at least someone (the Secretary.of the Department of

             Community Affairs) is listening     and sympathizing; al.thoug.h some of theDepartment's

             approaches are wrong    (such as advertising in a magazine for new     industry   to

             come.to  Delawa re).

                  .Mr. Biondi asked  Mr. Daniell'o what suggestionswould he make that his.

             Department could or should do to imprcve the language in Recommendations 2         and 5?
<pb n="359" />

                                                     15

              Mr. Daniello suggested that  some suggestion be added to have the   Governor

              assign a lead agency or a spec.ific group of people from different   agencies

              that would serve as the liaison for any company prospect. Mrs. Siebel ask   ed:

              "But isn't this the responsibility of the Division ofEconomic Development
              right now?" "Yes," Mr. Daniello replied, but hel does not have the power    or

              the authority-to tell the Division of Revenue (for instance) that when that agency

              has made a response to Toyota in Tokyo that that response should have been

              checked out with other State agencies involved in the answers that Division

              gave.. He does not have the authority to tell the Planning Office that the

              response given to a letter dated 1969 concerning the Degussa Company was too

              late. He does not have the responsibility for any other but his own agency.

              It was the general consensus of the Commission that there were entire7y too

              many levels of government in Delaware.

                  Mr. Krapf further commented that Delaware will not   grow if the permi t

              application hierarchy is allowed to remain as is. All the different agencies

              should get together to simplify the system. This should be done through the

              Department of Community Affairs.

                   It was finally agreed that the language of Recommendation 2 is not strong

              enough as to the role that should be given to the Department of Community Affairs

              (through its Division of Economic Development) in terms of receiving the lead

              as the coordinative agency to provide the necessary mechanism to all industria.1

              concerns (already in Delaware and wanting to come to Delaware) to grow in the
            @State.

                  3. Mrs. Smith,(representing the League of Women Voters for Delaware) asked

              the meaning of the term "speculative industrial buildings", on page 10.

              Mr. Daniello replied that in order to guide the growth  of industry into
<pb n="360" />

                                                       16

             particular parts of a state,    many states set-aside land and build a facility

             before  having the actual clients to occupy the     facility.- Delaware does not

             have this. Delaware has financial incentive programs that have been geared

             toward manufacturing facilities and toward financial loans for the owner
             after he is on site. The State would underwrite the financing through the

             bond act but it would be the private developers who would construct the facilities.

                   4.  After a short discussion, a general agreement to strike the word

             Ilentirely" in 4a., and a motion duly made and     seconded, the Commission

             unanimously adopted all of recommendation 4.

                   5. Already discussed within recommendation 3. There were generally

             two thoughts. One, that expressed the feeling that because the law has established

             a set of rules, nothing    can be done to change the process, and the.State should

             live with it; the second feeling was that the      law should be changed.

                   Mr. Oldach commented that the Commission     should express the needs that

             exist; the objective ought to be     the cha,nges; and the mechanism to. accomplish

             these changes can be developed later. Mr. Russell remarked that this is the

             very co ncern of New Castle County regarding the Delaware Tomorrow Commission.

             The values of all are the same;     the economic development is just as important

             as the enviro  nmental protection   aspects, but how is this   going to be done anu

             by whom is  New  Castle County's.great concern.

                   After a motion duly made   and seconded, the   Commission adopted Recommendation     5,

             as written.

                   6. Mr. Russell expressed    his concern   in regards to-the   contents of

             Recommendation 2, concerning the economic development of the        State against,
<pb n="361" />

                                                     17

              supporting the efforts of the DAC, which is a regional body whosedirection

              may not always be advantageous to Delaware. It was felt.that DAC was not

              instrumental in Sussex and Kent Counties obtaining EDA funds. In fact

              Mr. Bryson said: "When it came to Kent and Sussex (Counties) getting EDA

              funds, we got it in spite of Delmarva (Advisory Council).".

                   Everyone agreed to keep Recommendation 6 in the report,

                   7. There were some questions as to what taxes were referred to in this

              section. The word "adopt" was felt to be too strong and the consequences of

              adoption of a formula far too reaching. It was suggested by Mr. Bradford that

              it might be wise for the Commission to recommend a review of the State property

              and income tax base as a whole, at all levels of governments. It was the

              consensus to strike the word "adopt" and replace it by "study". After a motion

              duly made and seconded, the Commission adopted Recommendation 7, as changed.,

                   8. The League of Women Voters suggested in a 1  etter from Mrs. Marcie Bierlein

              that the paragraph in the middle of page 13, third sentence be changed to read

              as follows: "The highest priority for the State Planning Office under the Coastal

              Zone Management Program should be research to predict and to actively promote
              and direct development        Quoted, in part, from Mrs.  Bi erl ei n's 1 etter:. ."The word

              'monitor' bothers me since it implies passively watching and noting what we

              see happening. I would hope the State Planning Office, in coordinatton,with

              the affected counties would have adequate controls at their disposal to actively

              promote and direct development to those areas where it will do the least harm

              and will produce the least ulcerous impact to the State and the local areas,

              thus, I would prefer the sentence read: "The highest priority for the State

              Planning.Office under the Coastal Zone Management Program should  be research to
              predict and eventually direct the landside development that occurs as a result,
<pb n="362" />

                                                      18

             of offshore drilling for oil  and.gas  and/or of a deepwater port."

                  ,It was the feeling of the Commission members that the Planning Office

             should not be designated as  the agency to control the developmentsince it

             is charged with  the task of managing a  program which is directed to limit and control

             the development of the coast. The more    adequate wording should be       to

             research; to predict       and then charge an agency to monitor based on   the

             Commission's conclusions. The planning    function should not be given the  control.

             It was noted, however, that., as a rule,  the planning agency does not control but

             merely restrain. There has to be some.planning done if offshore drilling is to

             come to Delaware. No one wants uncontrolled and unrestrained development..

             Mr. Webb remarked that because of the numerous federal agencies involved in the

                                                                      w state agencies that
             offshore oil and gas drilling matter, -there may be a fe                        w ill
             handle the onshore development impact aspect     or the federal government may
             designate the Planning Office as the sole agency responsibie to Washington for

             the State of Delaware.

                  Mr. Biondi asked-whether  there was a necessity to say that.the highest

             priority of the.State  Pla nning Office is to research, etc. The general consensus

             was that the sentence read: "The highest    priority for the State should be

             research to predict and eventually direct   the landside

                  Mr. Krapf said that the State of Virginia., for instance,   is rapidly gearing:

             up to the idea of offshore oil drilling. Large tracts of land     are being bought

             (one of them by one  of the largest oil drilling rig firms)   to prepare.for the

             onshore development.   However, Delaware is still "researching   and studying".

             Mr. Walton remarked  that anyone can buy land in Delaware, but   the actual use

             the the land is controlled by the' local planning commissions.    The Commission

             is talking about making  'a State policy, but the controls are at the local levels.
<pb n="363" />

                                                       19

              Mr. Biondi mentioned that the way Delaware's tax structure is presently set,

              up all the tax benefits would go to the local governments and the majority of

              the costs for services would go to the State government - the State would not

              get any of the revenues. The State could have a net loss position econo-

              mically with that.kind of development in the State. It      was noted that
              Louisiana has a net loss of'$59 milli   .on a year. Mr. Oldach said that Delaware

              does not have much to offer in terms of economic development, its main asset

              is its geographic   location and the State should capitalize,on this.

                   Mr. Daniello   asked if offshore drilling was done in the Baltimore Canyon

              could the oil be brought into Delaware with the Coastal Zone Act in its present

              form? Mr. Keifer replied: "Yes, no question about it."

                   Mr. Wiener s aid that the way the paragraph is worded,(as     amended), on page

              13, is meant in no way to support or to strengthen the State Coastal Zone Act.

              The Coastal Zone Act in its present form would allow Delaware to bring in oil

              from the ocean. All this paragraph means is that Delaware has to study and

              research and eventually direct the landside impact so as to obtain orderly

              development. There are benefits that would result from oil drilling; there

              are problems; and the State's obligation is to come up with      an answer.

                   The Chairman asked for a vote. The Commission unanimously adopted

              Resommendation 8, as amended.

                   Mr.  Biondi suggested to schedule a meeting of the    Commission to   hear the

              addendum  report of the three members of the Economic Development Committee who

              have a different view from that of the Committee's on     the matters of the Coastal

              Zone Act and the State tax structure (Recommendations     15 and 16). Recommendations.

              9 through 14 would then.be considered by the Commission. Mr. Krapf sugges:ted

              that his Committee (the Economic Development) meet to examine the two issues
<pb n="364" />

                                                      20

             mentioned above so as   to iron out any differences. It was decided that
             the Commission  will meet  on June 4, 1975,  at 7:00 p.m., at.Buena Vistak.

                  Mr.  Keifer was asked.to send a copy of theaddendum report of the

             Land Use  Committee to, everyone, plus one copy ofthe full report to
             Mr. Krapf  who lost his ...

                  Chairman Biondi adjourned the   meeting.

                                                      Respectfully submitted.,,

                                                      Francine Booth
                                                      Recording Secretary

             *NOTE:  This  meeting was  subsequently  changed to.8:00.p.m.. in the Community
             Genter, of the Wi1ton, Deve-l
                                         o@pment (on@ the n6rth' sAde@ of U.S,.. 40' approximately
             one mile southwest of the i,,ntersection of U.S..40and U.S. 13). The date of
             June 4 remained the same.
<pb n="365" />

                                          DELAWARE TOMORROW COMMISSION

                                       Minutes.of Meeting of June 4, 1975

                    A meeting of the  Delaware Tomorrow Commission was held     on June 4, 1975,

               at 8:00 p.m. in the Community Center of the Wilton De    velopment.

                    The following members were present:

                         Mr.  0. Francis Biondi
                         Mr.  David R. Keifer
                         Mr.  James H. Gilliam, Jr.
                         Mr.  Ernest W. Thorn
                         Mr.  Peter A. Larson
                         Mr.  Carl S. Oldach
                         Mr.  Jay N. Cooperson
                         'Mr. Leon M4 Weiner
                         Mr.  Clifford B. Hearn
                         Secretary John C. Bryson
                         Mr. Theodore Ryan
                         Ms.  Joann D. Slights
                         Mr.  Albert Adams, Jr.
                         Ms.  Dorothy Greer
                         Mr.  John F. Walton
                         Secretary Cli.fford E. Hall
                         Mr. Henry Folsom
                         Mr.  Joseph Golden
                         Secretary J. Thomas Schranck
                         Senator Robert J. Berndt
                         Mr. Carl Russell

                    Also Attending:

                         Mr.  E. Sherman Webb
                         Ms.  Rita Smith (attending for Ms.   Marcie  Bierlein)
                         Ms.  Peg McClane
                         Mr.  John Morton
                         Mr.  William Bradford
                         Mr.  Arthur Krieger
                         Dr.  William Markell
                         Mr.  David Singleton
                         Mr.  Dan Kuennen
                         Ms.  Jane B. Aughey
                         Mr.  Richard M. Bauer
                         Mr.  Edward J. O'Donnell
                         Mr.  Steve Chamberlin
                         Mr.  David Markell
                         Mr.  Bernard Dworsky
                         Dr.  William B. Latham
                         Ms   Michele Kudish
                         Mr:  James Gutman
<pb n="366" />

                                                          2

                    Chairman  Biondi called the-meeting to order at 8:25 p.m. As an update

              on where the Commission stands In reviewing the Committee reports,           Chairman

              Biondi stated that at the end of the last Commission meeting the group had

              discussed the first eight recommendations of the Economic Development

              Committee Report. They also acknowl      edged the fact that there were two issues,

              the State Coastal Zone Act and the State tax structure that should be further

              discussed by the Economic Development Committee. The Commission members agreed

              not to discuss these two items until the Economic Development Committee had

              met to discuss them. This Committee met on Monday., June.2. Mr. Spencer

              Thompson, the Chairman of that Committee, notified Mr.. Biondi that there would

              not be a further report of     that Committee presented    to,the  Commission to.be

              discussed at today's meeting.-     due-to the   fact that  several interested Committee

                                                                         me
              members could not attend Monday's meeting. Another- 'eting of this Committee

              will be scheduled.

                    The Commission members agreed to     defer action on issues 9-14 of     the Economic

              Development Committee    Report until that Committee meets and decides what other

              amendments or modifications they.are goi.ng to       make to theirreport..

                    It was moved     seconded.that the   Commission move   on to the report   of the

              Land Use and Community Development Committee.

                    The Land Use and Community Development Report contains a        prelimin ary sec@-ion,

              pages 1-3,. which is merely an introduction.and general       findings  of the Committee.

              Mr. Biondi suggested that the Commission start discussions on page 4             discuss.ing

              the findings first and then the policies         as these are specific breakdowns of

              the general findings on pages 1-3.

                    Mr. Weiner raised several questions     about the   general findings on page 2,

              which he believes are    not dealt with elsewhere in     the report., He stated that in

              Paragraph 3 under General     Findings the use of the    words ',future quality of life"
<pb n="367" />

                                                         3

               and "Strict environmental and design standardsit and "high quality standards".

               he feels that the language is too general. He suggested that it be clarified so

               that when you talk about the "future quality of life" you mean the total environ-

               ment; the physical, social, and economic and not strict environmental standards

               only. He emphasized that the term quality of life may have d,ifferent,meanings

               to different people. He feels that the term is used       too loosely   could be very

               easily misunderstood.

                    He suggested that Paragraph 3 should read:*

                        "The Committee agrees.that Delaware's    strategy  should emphasize the
                        future quality of life for,the total environment, the     physical,   social
                        and economic aspects as well.

                        and "also by insistence upon desirable environmental and design
                        standards for new development."

                    Mr. Biondi asked what are the Implications that Mr. Weiner sees in      the

               paragraph as written. Mr. Weiner answered, "that poor people aren?t a nice

               quality of life." - What wetre talking   about Is a quality of life that takes

               into account the fact that our total living    environment  is physical, social and

               economic.

                    Mr. Larson had no strong objections to Mr. Welnerls     proposed changes.

               Mr. Walton stated that his thinking,on the reasoningfor      the wording was that

               this Committee was only dealing with Land Use and Community Development issues

               not the total picture. He feels that the     terms Mr. Weiner Is talking about

               should be, in the Commission report. Mr. Biondi    agreed and stated that that's

               the purpose of these meetings --to make any amendments forthe final report.

                    Mr. Larson felt that Mr. Weiner read something into the report that didn't

               exist. Mr. Walton felt that the basic Interpretation of the Land Use and

               Community Development Committee   is thatthe economl-c status of the peoplein the.

               State has something to do with their quality of living but     ft.'s not relevant to
<pb n="368" />

                                                               4

                the quality    of living   which they achieve when they live in Delaware             certain

                poor people    In this State have     a better quality of living       than certain rich

                people in this.State. Mr.-Biondi stated that the,problem is that we're dealing..

                with Images of what the quality of life should be.

                      Mr. Russell stated     that, as a member of the Land Use and Community   Develop-

                ment Committee, he interpreted         the title of   the Committee-Community Development,

                to mean the same definition that        the Federal   Governmentuses,      which Is physical,

                social, economic and environmental.

                      Mr. Weiner and Mr.Larson both agreed to change  the  word  "strict"   to

                "desirable,"  so as to read "...and also by Insistence upon desirable environmental

                and  design standards for new development".. It was also agreed  to delete   the,

              ..word "high-" In. Paragraph    3 -to read,  ".The Committee also agrees that with quality.

                standards...

                Community Development Patterns

                      The Commission then proceeded to page         4.

                     ,Mr. Biondi clarified     that   the word  'findings'    used  In this report means a

                kind of  broad conclusion     with  respect   to a  problem   based  upon the   overall

                knowledge, common sense,      observations    and experience,   etc. of the    people Involved

                In this   report.,

                Community Pattern Findings

                      Mr. Folsom    questioned  the first finding established urban settlements

                with  their  existlng..." -Is  there more than one with any support facilities

                In.the excess of their     needs      other  than the  City of    Wilmington?

                     Mr. Larson    stated  the term   "settlements"    refers to all. the towns In Delaware

                that  have basic    Intrastructure      no one 'community was singled out. Mr. Folsom
                asked  if there   Is more  than  one "settlement" that has a       -more than adequate
<pb n="369" />

                                                               5

                 structure and how many.of them are less than adequate?            Thts question raised

                 another issue: Are you assuming in thisreport that, If            a structure Is Inadequate

                 for further growth, It is cheaper to enlarge that.structure and add,to              it than

                 to start  anew. This question Is dealt with later In the report.

                       Mr. Weiner felt like the word "findings" really means observations. Then,

                 as a point of    Information, in Paragraph 3 under findings          "Factors other

                 than  those of  local concern    and the desires    of Indiv.idual  property owners    must

                 be brought   into the  planning process ... then      the "must"   is.not.an Imperative but

                 is part of   an observation of    the way it ought    to work or,   is working.   He asked

                 for clarl.fication.

                       Mr.-Larson stated that    the term   "must" indicates that     you want some.change

                 It Isn't working.     It Is   astatement   of a condition thatis not-existing at the

                 present time,that ought to     exist.,

                       Mr. Gilliam suggested    that, In light of the way      we've been operating and,

                 in terms of what's most important In this report,.It          might  be a good idea to

                 refer to the policies instead of getting very involved in           findings. Mr. Biondi

                 agreed and stated that, proceeding In that fashion,          if anyone wants to question

                 one of the findings.in relation to a policy point,-          please  speak up.

                 Community Patterns Policies

                       Dr. Markell stated    that on some   of these policies,     the Committee should

                 expand on how they    cameup with their decision.

                       The term "sprawl" could mean Newark       shouldn't  expand or you    don't   start.

                 a new community. We should have the        benefit   of how the   Committee  arri ved at

                 these conclusions.

                       Mr. Biondi felt that    no one policy   makes sense alone. .It should       be

                 in the context of all four     of  the.policies      they really   have to be'read   as  one
<pb n="370" />

                                                          6

                                  ake the first.three policies together, what they don't want
               policy. If you t

               to happen.concerning sprawl is pretty clear.

                    Mr.-Russell asked Mr. Larson-to-def,ine urban center and.how far that.de-

               finition is taken, For    example, would Brandywine Hundred be considered an urban

               center?

                    Mr. Larson said   that when  you talk about anurban center     you're'talking

               about towns essentially     although there are uninco   .rpqrated areas., for Instance,

               In New Castle County, that   would be defined as an urban    center. The     Committee

               didn't get Into that in   great  detall.- they were talking    about towns    towns that

               had a fire station, a cluster    of buildings, afeed store     and the kinds  of

               things that draw   people  In.

                    'Mr. Weiner stated that   he heartily supported   policy  number three    because

               it states that  urban centers     whether it's a big   urban  center Like Wilmington

               or just a small  conglomeration   in a rural or quasl7rural    area   are places

               where quality of   life that are  physical, social and economic    have bound people

               together. We ought to utilize     those qualities and revitalize    them to make

               maximum use of what exists.

                    Mr. Folsom asked for clarification of the word "urban".        If youtre  talking

               about urban meani  ng. municipalities or incorporated areas, then.   in policy  number
               two, the on,ly place in New  Castle County that could    use that. policy is Wilmington.

               He questioned whether ltl.s  even needed.there. Ifthe      word "urban" does    indeed

               mean municipalities, then   the policies are   not practical. in New Castle   County.

                    Mr. Cooperson felt that the critical     pointis,the   matter.of.physical

               facilities wh-ich are in place - orcould easily      be put  in place  asthe  basic

               matrix for some concentration,   of population. The    Committee felt   that, not only.

               in terms of physical form, but in terms of energy      demand, we can  no longerafford,

               as a society, to go on dispersing    population or   leap-frogging developments as
<pb n="371" />

                                                              7

                we have in the past    and expect that we can.extend,the physical.facilities to

                them Indefinitely.:.This Is no longer a       practical solution. The crux      of the

                matter is:. are the    physical   facilities  there or can    they be easily put In or

                be tied into physical facilities somewhere       else. On     that basis there are some

                communities.  that are not qualified as an,    Urban, center. However,, there may      be

                a population   concentration where physical facilities       are avallab.le  and   It  is

                sound policy   to encourage development, either through i,mprovement,of transpor-

                tation systemsP of sewers, etc.

                     Mr. Oldach felt that the Committee needs to give,more thought to how we

                define what Is a reasonable concentration..and technique        for future growth to

                balance,the values of open space versus,residential areas          and communities.

                     Mr. Biondi tried to define what areas the Committee         had  in mind with the

                concept of urban centers.

                     Mr. Thorn stated that the Committee       felt  the need to   emphasize,  along

                with a desirability to preserve open space the need        for a   more efficient   use

                of energy. The Commission has to decide whether we         want to-encourage cluster
 IN
                and discourage sprawl..

                     Mr. F olsom suggested that    policy number   two be  changed to read,    "New

                community development generally should        occ.ur.within or near  existing  population

                Co"ncentIrations whereutility networks     and community   facilities and services are

                already In place or can economically       be,expjanded.

                    .Dr. Latham noted thatthe Committee's         report suggests that,   wherever

                growth takes place, that    those who    are  to,benefit from the growth    should,bear

                the full cost of it. He felt that-the Commission         should  embrace  this idea.

                He suggested  a user charge for people to      bea r the fullo-cost of growth. Mr.     Biondi

                noted that Dr. LathamJs talking about         number  one  a po,licy.and  numbertwo

                a penal ty for  refusing  to follow that.pol   I cyl,
<pb n="372" />

                   Dr.  Latham explained that If everybody has to share the 'fulJ cost of the

              facillfles for growth    then the least cost was   to take advantage of existing

              faci-lities. However, if there is a group of people who are-wil,li-ng to pay-the

              cost of a new development far from anything else, does this Commission want

              to go on record as wanting to not allow them the choice of bearing the full

              cost of.their growth to have a new development In a     new area? Mr. Biondi said

              that what the Commission wants to   do Is express a.sense  that the-public policy

              ought be not to encourage it. Dr.    Latham explained that pay-Ing full cost.takes

              care.of that without trying  to direct peop.le's choices.

                   It,was moved by Mr. Thorn and seconded by Mr. Weiner that    the first three

              policies be supported. as amended..

                   On policy number  four, Mr. Gilliam noted that It   should be clarified exactly

              what Is meant by "code" - just what Is being advocated    here.

                   It was agreed that policy number four should be deferred to be discussed

              along with the addendum and the report of the Econom   ic Development-Committee.

                             ed that for the purpose of future discussion, when a       conomic
              Mr. Biondi stat                                                       n E

              Development Committee Report  and AddendUMrto the Land Use   and.Community Development

              Reports are discussed, we should clarify what we are   talking about when  we say

              land development standards in  this context.

                   Mr.. Larson answered that the Committee  wasconcerned with how you went

              about controlling land development    hot concerned much about where.or how much.

              Mr. Bryson suggested that  "guidelines" shou.1d.be substituted for "standards"..

              Transportation Policies

                   Secretary Bryson suggested that In policy number two   the word  "need" be

              changed to "availability".

                   Mr. Weiner stated that In policy number one the   statement   "not cars"

              implies that you don't want anymore highways. He felt     that todeclare  a
<pb n="373" />

                                                          7 9

               vendetta,on automobiles or on highways Is unrealistic. It is a matter of

               saying that we Want our emphasis to go In the area of mass transit.

                     Mr. Larsoniclarified that the,phrase "not       cars" is not meant to imply that

               you  shouldn't build anymorehighways - it means         that, If the best alternative is

               to. move people and goods in mass transit      other  than cars, then thatts the way

               it should   be done.

                     Mr. Chamberlin explained that     these  policies are   a.two-sided   Issue. If    a

               development is located c.lose to an     urban  center where   therets regular bus

               transportation In the terms of the      designof that developmentand         its,.approval

               througha     planning process    that can reduce    the public   and.private.investment

               necessary  to  produce a given number    of houses   by adopting these policies.

                     Mr. Kreiger felt   that before a   policy of   this type.is decided    on, they

               should have some Indication of.how this con.clusion-was reached;,for          example,..

               what would be the cost.

                     Mr. Thorn directed   Mr. Kreiger   to policy number four.as the answer       the

               Committee had to try to    avoid getting into a.sc.heme     which might end up wasting

               money.

                     Mr. Webb noted that another problem      Is that,  for examp,la, a study    is being

               undertaken by Highways and      Transportation  of.mass  transit  needs in. Kent   County

               which will' probably    result in a demand responsive    system  because of the    low

               concentration of    people as  opposed to a   fixed  route  system'.  There   is.a.

               differential in terms of the.area      to be.served, the    type of  equipment or   type of

               service provided.

                     Mr. Gooperson   felt that  it was.important to think     in terms of a   balanced

               transportation   system in lower Delaware     as well as New   Castle  County. The

               Commission should    decide whether the emphasis is going      to be  entire,ly on highways

               for moving goods or    whether they   will  put emphasis  on  seeing  that the  railli.nes
<pb n="374" />

                                                      10

             are revitalized so that we are not totally dependent on highways.

                   Mrs. Smith (representing'Mrs. Bierlein) asked whether policy     three "in

             urban and.resort areas" should be inserted - or whether.the--intent of-.the

             Committee is to promote mass transit Statewide. It was agreed that this was

             needed Statewide.

                   Mr. Biondi asked If a developed   mass transportation system in.terms    of a

             bus  system in New Castle County was   feasible or  does it run contrary  to human

             nature.

                 .Mr.  Larson stated that there was,a pretty    fair mass, transportation.system

             operating.in New Castl-6 County now,   however it could be Improved if there were,

             more.volunteer rider  sh I p.

                   Mr. Biondi stated that we may   need to insure-Juture, public  funding of-the

             mass transit system on a long term    basis.  Mr. Weiner, noted that In 1957, during.

             the planning stages of many of our    highways, many  peopleralsed the question of

             using the freeways as a 'system   for mass transportation w4th.loops that would

             run-in high speed.lines Statewide and there.ought to be parking and riding

             faciliti-es at every Interchange and additional land shoul-d'be acquired. There

             was no governmental po.licy to'support that. Mr.    Weiner.expressed-his.support

             of policy number one as long as the words "not cars"     doesn't give the  impression

             of being anti-highway.

                   It was agreed to change po,licy number  I to read:,

                       "Transportation policies should be primari[y    concerned with  the,
                       movement of people and goods, not just W11h.the movement of,cars.11

                   Mr. Bradford notedthat in policy number one,    the  movement of goods Is  men-

             tioned but it's not  mentioned in  any policy  thereafter  - there Is more concern

             with the  movement of people.-.-This report should address the rail problem.

                   Mr. Walton said that the improvement of existing roads was one ofthe

             desirable features of  this Committee, however he agreed that the railroads
<pb n="375" />

               should be  improved to  facilitate  the movement of goods.

                    Mr. Folsom noted   that in policy number 2 an economic balance should      be

               achieved in the best way to transport people and goods. He questioned whether

               the Committee realized themeaning of,the statement        "increases the resources

               available for mass transportation". T    he operating subsidy for DART has Increased

               500% in the last four years. In addition, Federal funds       have been received.

               Is the Committee saying that over and above w,hat they are     spending in govern-

               ment funds nowj that we recommend that that be Increased?

                    Mr. Biondi clarified that the Committee Is saying that      a.larger portion

               of transportation dollars should be spent on mass transportaflon      than Is

              .currently spent.
                    Mr. Singleton felt that the Committee should think      of positive incentives

               to encourage the most efficient forms of    transportation   for people or goods.

               For example; parki  ng and riding facilities, subsidization of mass transit,
               etc, Mr. Cooperson  noted that, like    itIor notwe are going to have to turn to

               other forms of transportation - because within a few years, we're not going

               to be able to afford  to do It the way we are now.

                    Mr. Chamberlin expanded on Mr. Folsom's statement of the economic

               balance by saying that you have to look at total     dollars and not just,the costs

               the County Council would have to vote on in'terms     of their Capital Budget.

                    Mr. Bryson suggested that In,policy number two     the words "need,f6r" be

               changed to "availability of" and that some approach     be taken to.reduce the

               availability of parking facilities    to help promote  mass transit.

                    Mrs. Slights  pointed.out tha t  the words "need  for" provide the pos.iti-ve

               point of view and  "avallabili.ty of" express the negative point of view.. One

               supposes that you  are going to provide   enough mass  transit that  the need for
<pb n="376" />

                                                        12

              the automobile is no longer going to be necessary and,      therefore, you will not

              need to have the availability of'the facility. She proposed an amendment that

              'both statements be Included in policy number two to read: .11-reduces-the need

              for an'd.therefore the avallabllity@of automobile facilities In urban and

              resort areas".

                   A motion was made and seconded to    accept policy   number two as amended by

              Mrs. Slights.

                   Mr. Singleton proposed, on policy number three, to change the word-ing to read

              "to promote all use of mass transportation through the greater development of

              positive Incentives  and to educate.0'.1t..

                   Mr. Russell noted that the need for Incentives In Now Castle County Is as.

              great outside,the City 9f Wil.mUngton as it I,s.inside the City. Mr.      Singleton

              said that his recommendation wasn't I-ntended-to apply only to the City.

                   It was moved and seconded that pollcy.number     three be  approved  as amended.

              It will read: "Delaware shou-Id develop programs     to promote  greater  use of mass

              transportation.thro.ugh the development of Incentive programs      and to educate.

              citizens on the need   for increased use of transit.

                   It was moved and   seconded that policy number four be accepted as     written.

                   Mrs. Smith questioned In polAcy number four on page 6,      you ta,lklabout

              utilizing existing  technology and in B.1   on page  7 you talk  about fiscal com-

              mitments for exploration and developments ofnew      systems.   She  asked if the,

              Committee wantedto clarify how much emphasis.to      put on each  of   these policies.

                   Mr. Larson said this was an Inconsistency.      B.1 will be   modified to con-

              form with number four on page 6.

                   Mr..Larson went on to say that the Committee     feels that we shouldn't,

              at th.is t.ime,.venture Into a lot of esoteric.personalized transportation      systems.

              We should put our Federal money where we know thesystem will work          and  that1s
<pb n="377" />

                                                        13

               in buses    that Is what we tried to   say in number four.

                    Mr. Russell expressed his feeling that the policy statements      ought to.have

               some sort of explanation in the final report. Mr. Biondi ex      plained that the

               revision of the preliminary draft will.be constructed out of the minutes of

               the meetings and the changes made all along.

               Uti'lity Findings.

                    Mrs. Smith read a letter written by    Mrs. Bierlein which stated that

               flutility finds 2 and 3 seem to be In conflict. What     Is wrong with  constructing

               interceptor lines with excess capacity,in areas where     development  is being

               encouraged. Perhaps the Committee Is s.imply giving     a caveat In number  three
               that great care shoul/d be exercised ln.pla'cement of   sewers, since they   are

               such a powerful Incentive In development. Certainly.no excess capacity should

               be built Into lines In areas where future development. Isto be discouraged. On

               the other hand, since sewers require   such a massive public Investment, it would

               seem to be prudent for local governments to build In appropriate excess capacity,

               in those areas where they want to encourage growth,".

                    Mr. Weiner stated that there may be someplace In this country, State, or

               county where there Is a current practice that results in the construction      of

               interceptor lines sized  wl.th.excess capacity and designed.to.serve the ultimate.

               He's never run across  one, however he believes that this runs contrary.to     the
               other policies that call for avoiding "sprawl". The definition of       "sprawl".-

               used on a. previous policy that said we should discourage It:- is      unreasonable

               and inefficient use of community.facilities. This finding (number       three) says

               that you shouldntt design them to serve   the ultimatehighest density population

               anticipated.. This is very confusing.    He agrees with number.two.     Mr. Weiner

               felt that one of the  problems is that  "we respond to sewer lines and other
     J
               utilities only when there is   a demand and we are In a,crisis. Number three
<pb n="378" />

                                                         14

                                 e and two logically and needs to be revised. Number four          is
              doesn't  follow on

              correct  in that It creates a self-fulfilling situation but is a valuable tool

              for.,guiding,,Ia.nd use an,d,therefore should,be I-ooked at as..a  good th i.ng. -, From-

              that point of view, If we're going to get a utility policy,        we have to get our

              findings consistent with what it Is we're trying to do.

                    Mr. Biondi gave his Interpretation of the findings      as. follows:

                    Itif you have point A and point B and they are, say,     ten miles,apart, the

              thrust of this.finding was that we shouldn't      build a sewer to,se  rvepoint B

              if there's nothing happening between A and B      because youtll be.forcing develop-

              ment between A and B. You'ought to try to force development         closer to point A

              which assumes some logical    extension of your line."

                    Mr. Weiner  stated that i-f that's the thrust, then the    words'llexcess

                                                                               It
              capacity" are wrong - what you're     saying is "over extension       If you say excess

              capacity, youlre talking about    the  sizing of the pipes to handle as high and

              clustered a density as you can      which Is w  hat we-ld like to see so  it doesn't

              get sprawled all.over.

                    Mr. Bryson  said that excess    capacity Is required  by law. Extension is a

              better use..

                    Mr. Wa,lton explained that   when the Committee discussed these polic    les, scme-

              one from  the Planner's  Office  said  that the cons.ideration of the planners,in

              Sussex County was for   84 inch  sewer   mains down in the Bethany Beach@area. This

              Is excess capacity. What happens is that       from the time  the planner puts    this on

              paper to the time the elected officials put out the money, the 84 inches          gets shrunk,

              to 24 inches.

                    Mr. Russell stated that possibly     the reasonjor people moving in this

              direction reflects on recent activity.in the past two years and present activity

              in New Castle.County and some of the     interceptor activities toward Glasgow and
<pb n="379" />

                                                        15

               Newark., These activities all relate to already committed on line, rezoned

               activities - major rezoning activities      which were.a legal. commitment  that

               New Castle County had made.. These were not excess     capacities.

                    Mr. Biondi asked Mr. Russell If he was    saying that  when the.County  rezones

               a property, it makes.a legal commitment to    provide the  utilities.

                    Mr. Russell said that was not what he.was saying.,     He clarified that there

               is a reasonableanticipation of population growth to use      those utilities  within

               a short planning span, This was a legal commitment the      county had made.

                    Mr. Bryson clarified that the reason for excess capacity.was extension.

               ExcessIcapacity in a line means you plan to have a sewer line and.a sewer system

               that will serve  an anticipated growth for a number,of,years. You canit      build a.

               line today that doesn't have any excess cap,acity and still keep any reason to

               your construction periods, If you do,'It w    ill cost:you double orthree times

               as much to come back next year or the following year to correct the situation

               you've made a mistake on, as it will be to put some capacity there. Over,

               extension   building a line   in the area.where you have no reasonable expec.tati   on

               of growth simply to create that growth      is.bad. The excess capacity is required

               to avoid superfluous construction costs later on.

                    Mr. Biondi asked  if using the definition of over extenslon.and      looking at

               the problem in those terms, is there a current practice.of.over extension anywhere.

               Mr. Bryson said that there was in   Sussex  County. For example, they put lines in

               where they had no  anticipation of  growth  on the streets    It was done at the

               t.ime the town said we'.11 have growth there  someday. When you're   trying to promote

              @growth by putting,a sewer there     that's over extension.

                    Mr. Biondi suggested that numberthree be changed to      reflect overextension,

               asa problem rather   than excess capacity.

                    Mr. Weiner noted that again apparently finding    number  four  is directed to

               that specific,condition of encouraging growth in    towns where there are   over
<pb n="380" />

                                                           16

               extensions.

                     Mr. Bryson suggested changing the phrase "construction of excess            sewer

               capacity",to "over.extension of sewer systems'        in finding number fou.r.,r          7

                     Mr. Weiner asked if it isn't a constitutional,right of the people in a

               community to want.a.population increase. -Mr. Bryson'said that they have the

               right to want it, but the State also has the right and the          obligation under     a

               Federal planning concept to do a State Plan          which has  to  be approved and their

               concept.of growth has to jive with what we.feel to. be a         logical growth factor

               and.not one of high anticipation.       This,goes both ways.

               Utility Policy

                     Mr. Wa I tor n noted that Mr. Conaway abstained from voting on this       Issue

               -@because Sussex County  I:s us I ng ut-1, 1: l-tTes to@ foster growth. -
                     Mr. Weiner said   he had no objection to theutility poiicy        except that   he

               was not sure what the    word "premature" meant In this policy.         If we understand

               that premature means    not timely in terms of the growth      patterns that are

               existing then he could accept      It.

                     Mr. Cooperson   pointed out  that he didn't think this policy need5rt       he word

               11premature". He also felt that the word "necessary" is not necessarily the

               best word.   He suggested   that that phrase be changed to      "....which encourage

               development  in areas   not otherwise desirab.le for urban uses". My understanding

               ,of the Committee's position was    that we were talking about a correlation        between

               that growth of sewer    facilities-with support that     may be desirable or not      de-

               sirable from all of   the other,factors    that should   be taken into.account in:the:

               planning process.

                     Mr. Walton pointed out that    the objection    the Committeetried to raise in

               this policy was unwise use of tax     money. The    F ederal Government had no business
<pb n="381" />

                                                          17

               giving the towns money unless    the towns know   what they were going to do with it..

                     Mr. Biondi noted that Mr. Luce had not voted on this policy. He asked

               Mr. Russell and Mr. Bauer what objections they had to this pol.icy. They said

               they had no objections to the policy with the changes. made striking "premature".

                     This policy was accepted as amended.

               Implementation

                     Section-A-1 under tax measures was approved as written       with no objections.

                     Mr. Weiner made a motion that Section A-2 be      stricken.   The motion was

               seconded by Mr. Blond.i. Mr. Weiner agreed to leave: "Tax incentives to property

               owners to  keep land in open or non-urban uses",as is and strike the rest. He

               felt  that this policy discourages comprehensive plans and encourages the one by.

               one zoning  and planning decisions that the Committe.e.found      in their Community

               Patterns Findings was not good planning.

                     Mr. Biondi asked about   the argument  that this would, in fact,     force land

               into  premature development?

                     Mr. Weiner said not if   you're going to raise the tax base-everybody's

               going to try to keep their    land open space,until they're,   immediately ready to

               use it within the next week    or two because theminute you     get it rezoned, you're

               going to pay premium taxes on it.

                     Mr. Bradford.said,that his understandi.ng    on the "windfall   profits tax"

               is something done by governmental.action. S,uch as 1-95 or properties immediately

               adjacent to 1-95, w-here the land has a.change in va.lue immediately.

                     Mr. Biondi asked what the time span is from the time      you'd plan a   develop-

               ment, take it  through rezoning, to the time that development would be a viable

               economic entity? This is about a two      year.period.
<pb n="382" />

                    Mr. Weiner felt that there were questions with A-2 and the public     action-

              the windfall profit tax. His argument Is that where properties are adjacent

              such as to a freeway-or elsewhere - and wIJI grow     incrementally, somebody has   to

              tell how you're going to determine what the profit     is that will be made at

              some point In time and tax them immediately for It     - which Is an impossible

              thing to.do. This    I-s obviously unfalrand Impossible toadminister.

                   Mrs. Smith pointed out that   the sentence says   "tax Incentives.coupled.with

              immediate tax obligations". She     felt thi.s meant that a piece of property

              wouldn't have any  tax obl.lgatlons coupled with tax.incentives    previously.  Mr.

              Walton said that assumption was correct. Without confusing the-issue of a       roll

              back tax public plan, one of the words to be looked at     is "rezoning" and,the

              questlon-of when the.rezoning.takes place.     If governmental action-causes a

              utility to go th rough an area, there wou.Id be no additional tax b   urden

              Immediately until the rezoning were applied for. The idea on this is that       all
              the open spaces that were held In speculation out he    re are on the agricultural

              rate, which is the reduced rate, and not bearing the full burden of the

              speculative land value as the rezoning took place. When the land has been

              rezoned, the owner should be taxed fromthat day on,an.d not left at the

              agricultural rate, because from the time of rezoning a profit is anticipated.

              Mr. Weiner objected because the person who.will, ultimately p   Iay at a higher.rate of

              taxes on the land Is going to be the new homeowner, If you're going to tax

              it based on the rezoning.

                   Mr. Walton clarified that this Is true only if     you.build in an area in the

              eyes of everyone else, considered to be an open space area.      This Is a.deterrent

              to building in these areas.
<pb n="383" />

                                                        19

                    Mr. Bryson  asked what  would happen to  an area that the county rezoned,

               for example: a   farm that,  through a zoning change, is reclassified as a residential

               zone. This change is not    sought by the farmer - it.co.mes thro  ugh a change

               In county plans,.etc. Does the farmer have to pay the higher       tax rate? Mr.

               Walton said he would.

                    Mr. Biondi asked what   was meant by the  statement "tax incentives to property

               owners to keep  I.and In open and.non-urban uses". He asked If there wasn't

               already a tax Incentive.

                    Mr. Bradford suggested   that the word 11such",be.inserted to.,read "coupled
               with immediate tax obligations when such landlis.committedo..".

                    Mr. Biondi clarified that A-2 Is proposing tax incentives, but does       not

               spell out the kind of Incentives. He     suggested putting a period after the word

               rezoning.

                    On the concept of other   public action, Mr.  Walton.stated.that he feels that

               i-f the government takes th.Is  action on the individual, he feels that it's within

               their domain. If   the taxpay ers of this  State tell a landowner that they are

               rezoning his property to a different use that it Is currently applied and that

               will be the ultimate'use, then the taxpayers should pay for It.

                    Mr. Biondi further suggested that A-2 be amended     to say 11... for use as a

               result of the owner seeking rezoning.11

                    Mr. Russell noted that on page 11 under open     'space, Implementation  number

               one says basically the.same thing as A-2. Mr.     Weiner felt that the wording

               In implementation number one should be worked     into A-2. He felt that this wals.

               clearer.

                    Mr. Waltonclarifled    that the "windfall  profits  tax" was meant  to be  only

               an example of a tax  Incentive.    Mr. Weiner felt that  Ifthe policy   recommendation

               is not clear, it ought  to  be worked on.   How are tax  incentives going to   be
<pb n="384" />

                                                     20

             defined?

                  Mr.  Biondi made a motion that A-2 be amended to  read: "Tax incentives to

             property owners.should be-developed to..keep land in open-or- non-u-rban@uses, coupLed..

             with immediate tax obligations when such land  iscommitted for use as a result of

             the owner seeking rezoning."

                  This motion was moved and seconded  and approved by all.pre sent except

             for Mr. Weiner who voted no.,

                  The next meeting of the Delaware Tomorrow Commission was scheduled foe

             June 9, at 4:00 p.m. at the Wilton Community  Center. The follow.ing meeting

             will be held on Jun e 16, at 4:00.p.m.An the Cabinet Room of the Town-send Building,

             in Dover. Sandwiches and refreshments will be served ateach of thesemeetings..

                  The meeting was adjourned at 11:00-p.m.

                                                      Respectfully submitted,

                                                      Dee Burkley
                                                      Recording Secre tary.
<pb n="385" />

                                          DELAWARE TOMORROW COMMISSION

                                       Minutes of   Meeting of June 9, 1975.

                    A meeting  of the  Delaware Tomorrow Commission was    held on June 9, 1975, a  t

               4:00 p.m. In the Community Center of the Wilton Development.

                    The following  members were present:

                          Mr. 0. Francis Biondi.- Chairman
                          Mr. David R. Keifer
                          Mr. Peter A. Larson
                          Mr. John F. Walton
                          Ms. Joann D. Slights
                          Mr. Jay N. Cooperson
                          Mr. Leon N.. Wainer
                          Mr. Carl S. Oldach.
                          Ms. Marcie Blerlein
                          Ms. Dorothy Greer
                          Ms. Marion 1. Selbel

                    Also  attending:

                          Mr. E. Shaman Webb
                          Mr. Dan Kuennen
                          Mr. Arthur J. Krieger
                          Dr. William-Markell
                          Mr. William Bradford
                          Mr. Carl Russell (voting   proxy for Mr. Slawlk).
                          Mr. Steve Chamberlin
                          Ms. Rita.Smith
                          Ms. Peg McClane
                          Mr. Bernard Dworsky
                          Ms. Jane B. Aughey
                          Mr. Edward J. O'Donnell
                          Mr. John J. Kirwan
                          Dr. William Latham
                          Mr. Gerald Doherty

                    Mr. Biondi called the meeting    to order at 4:25  p.m. The Commission is     in

               the process.of  discussing the  Land  Use and Community  Development.Committee   report.

               He asked if there was any further    discussion concerning A-2 under   Utility  Policy.

                    Mr. Weiner recording the only    no vote on  A-2 as amended asked if   the

               Commission would consider changing    the phrase  "as a result of rezoning" to

               flat the.point at which the plan Is   recorded".  This means the tax structure

               would change once therel,s a  recorded  plan, on record, which commits it.to.that   use.
<pb n="386" />

                                                        2

              Otherwise, large scale planning, of any kind, gets penalized unfairly. He

              stated that he wanted to cl-arify why he voted no. He agrees with the princigle
              that we need tax incentives so that property owners will keep their      land in open

              space and also to "attack speculators who rezone the land and ride it for its

              highest value to milk it because of a.public action." However, the penalty

              should not be on the  new homeowner. He asked     If the Commission would consider

              this aspect of this   issue and make the changes suggested above    or at least spell

              out that the Commission is not looking to penalize the phasing      of a.development.

              He feels the phrasing'of this policy should    be fully explained.

                   Mr. Walton stated that when the zoning    request is made, Is   actually when

              the land is committed to the non-use of agricultural open space.

                   Mr. Larson suggested, as a compromise language, using the'phrase "....result

              of- the:-owner seekUng' to dqve,.Iop

                   Mr. Bradford felt that a tax    incentive program should take into   consideration

              a logical, carefully designed, phasing In or phasing out     program. He further

              stated that what we're trying to get away from Is the sudden windfall type of

              changeover rather than the kind of thing Mr. Weiner's talking about.

                   Mr. Larson noted that the other side of thecoln Is that we're trying to

              encourage people not to develop by giving them the incentive of lower taxes.       The

              trade-off to change one's mind 1n.that situation is roll-back. The point at       which

              you impose that penalty is the crux of Mr. Weiner!s question.

                   Mr. Cooperson stated that if A-2 is designed as a tool to keep open space

              the objective is fine. If the community wants the open space, then they should

              be willing to pay the cost for it. Preferential Assessment does not seem to be.

              the best tool.

                   Mr. Walton agreed and said the best tool is    tomaintain an environment of

              the economics that agriculture can succeed and youtil get the open space free.

              When you change the economics and   make  it more profitable for the farTner   to.sell
<pb n="387" />

                                                             3

                his land, then he'll sell it.

                      Mr.Veiner emphasized that his.concern        is with  the use of the   land. Mr.

                Walton said that the law which is passed for        farmland assessment in    Delaware

                establishes the criteria for whether or not you received the farmland assessment.

                It's In the law who,ts going to qualify and who isn:ft.

                      Mr. Larson agreed that the language on page 10-and 11 Is         more preclse.than

                A-2 on.page 7. He explained that there will be,quite a,few redundancies in the

                report because several people:wrote it.

                      Mr. Biondi noted that.no one has any detail with         respect to the kinds of

                specific tax incentive plans that should be included.          He asked if it made

                more sense  to.adopt the implementation number one       on page.  11 and striking.

                A-2.. This  paragraph Indicates,that there are       specific  plans  involved, however,

                none are mentioned.

                      Mr. Larson  noted   thatP originally,   the Community Development Section      was at

                the end of this   report and   was then moved.to   the beginni.ng due.to its broader

                scope. This -is   one of  the  reasons for the,greater    deta.il In A-2.

                      Mr. Weiner  stated   that he had no objection to    the policy on farmland     on page

                10 for farmer preference. However, he.felt        that shelteri-s as important as food

                and should have as   strong a policy.

                    .,Mr. Walton said that he felt the intent ofA-2 is to work against the wind-

                fall  profits.   Mr. Weiner said that if that's the,     intent,AtAs not stated        very

                c lear I y.

                      Mr. B.iondi said  that someone ought to take into account the comments         on

                ..pages 719 10 and 11 and work  to.revise  the language   to get a consistent     policy.

                Public  Investment

                      Mr. Larson suggested a change in     language    for B-l.to make it consistent

                with  Policy Number 4 on page    6, which  was  adopted at the last meeting,.,to     say;
<pb n="388" />

                                                      4

             "Greater fiscal commitment to transit, including an explanation of innovative

             systems and approaches".

                   Mrs. Bierlein asked if this statement includes commitment   in the area of

             operating funds.

                   Mr. Weiner suggested changing the wording to read "Greaterfiscal commit-

             ment, including  both capital and operating funds, to transit...

                   It was agreed that the title of this section.be changed to.Public.Fundin.g..

                   Mr. Russell pointed out.that  in B-2 the phrase "excess.capacities" is used

             again. It was decided, at.the last    meeting, to change this phrase to "over

             extensions". This change was again    agreed to.

                   Mr. Russell also asked the Committee for  an explanation of the phrase

             11excossively long proJect des.ign-life". Mr.  Weiner said thatthis means they. Ive
             be§un-+-o'des,igrf sewer l4nes and-other uti'lit-ie's to last.for the next.17 centuries,

             the standards are so high and expensive that   they are beyond a reasonable economic
     Y
             design standard to achieve. Mr. Russell agreed    that this phra se means standards,

             of design,,rather than project design life. He    asked If this means thatthe

             period of time which whoever Is putting this in   Is spending inordinate amounts

             of time to put the whole project down and get it   into the ground?

                   Mr. Larson noted that David Hugg, of the State Planning Office, had written

            @this part of.the report.   He interpreted this section tomean that you dontt want

             to build something that may be  obsolete if technology improves your,@means of

             disposing of sewerage, for example.

                   It was agreed to delete the word "design"  In B-2.

                   Mr. Biondi asked what policy B-3 is Intended  to do. Mr. Cooperson answered

             that component had to  do with sewer systems in  southern Delaware,wh6reby connections

             to major sewer systems In rural areas were being   done directly and enco uraging

                                        reas where it would be  otherwise unwise,
             scattered developm  ent in a
<pb n="389" />

                    ..Mr..Walton clarified  that the Committee, In policy     B-3, is saying that,,If

                you make a commitment in.the    design of a project to   control access to preserve

                an area -.that you don't break the commitment.

                     Mrs. Slights noted that the idea.was that when there       is an Interceptor pipe,

                the main transporting pipe that goes down a road like-U.S.       13, if a development

                comes between one  major municipality and another, on     this  line, that development

                .can't come In  and tie Into this main line. .It must,    in fact, go back to one of

                the municipal  lines.and tie, through that system,,to     the mainline.

                     Mr. Larson.stated that this Implementation tool.     was.designed to rel.nforce

                the general  community development policies, whic.h;the Commission has generally

                accepted, that Is: we don't want scattered sprawl development along        the highway.

                If you can prevent development from tapping     into the sewer lines.and    guide develop-

                ment to go to th,e.communities     that helps re-enforcethe land development policies.

                     Mr. Weiner suggested that the word     "strict" be taken out of B-3. He feels

                the word "strict" implies a strength and     a,rigidity that i,s going to be   impossible.

                Mr. Larson said he had no objections to this and further felt that "adherence"

                could be deleted also -,so as to read "This Implies development and implementation

                of a hierarchial  system of highways   and utilities".

                     Mr. Russell  ind-icated that the  word "hierarchy", which   the Committee intended..

                to use In terms of.systems.,  ought to also imply.commitment    to capital planning

                and capital budgets and the maintaining of those capital plans or budgets.

                     Mr. Larson felt It Is theresponsibility of the'countles and the State          to

                adopt that hierarchy as part of their Capital funding program. They know what

                they need. inthe  way of facilities to enforce.their plans.      That Is  where.the.

                hierarchy is created in the process of planning and financing      these  public

                facilities,
<pb n="390" />

                                                           6

                    Mr, Weiner expressed concern over the       references to Capital funds. There

               are interceptor lines that have been built       private.1y. He   asked if by the

               implication of the Capital funds, are we excluding the right of private

               citizens who payed for the interceptor to use       it? Mr. Russell answered no.

                    On policy.B-4, Mr. Larson stated that       he found this policy    to be redundant

               and,easily strikable from the report. It       was  pointed out that,    In the preparation

               of this policy, Mr. David Hugg     (a memberof the Land Use and Community Deve,lopment

               Committee) noted that,many times theState        doesn't  follow its own policies and

               puts facilities   Where there aren't   any Infrastructures.to,    serv,ice them.

                    Mr. Larson   noted-that another point be.ing spoken to in.policy B-4,was

               the concern that   the federal,government bring its      policies  in.,the State of

               Delaware in line   with other community objectives.

                    Mr. Weiner cautioned-the-Commission against       taking.a firm stand on what

               m1ght be desirable   In the efficient use of community facilities, as to have one

                                                                        hich would have urban concen-
               believe that the Committee is proposing a policy W

               tration for everybody except for those who may haveagricultural sites.

                    Mr. Walton pointed    out that there is not enough land in the Sta.te of Delaware,

               for every resident,to,have.10. acres of      land.

                  .,Mr. Larson   suggested that the-words "should be located" be added to B-4

               so as to read '.'Public and publIcly   supported facilities,     services, institutions

               and facilities should be locatedin      accordance with the policies above,.i.e.".

                    Mr. Oldach stated that the Commistion.seems to be        addressing the.problem of

               land use, recognizing that we'Te going to,have to restrict people from spreading.

               out all over. If the Commission does feelthat this Is a critical problem.and

               we'll. have to control the use of land much more,than we have in the past, then

               the Commission should be more specific.

                    Mr. Biondi said that the Committee Is-saying thatpublic investment should

               not encourage sprawl by locating outside of the areas of urban concentration.
<pb n="391" />

                                                       7

                    Mr. Larson, commenting on Mr..Oldach's statement, sai,d that he feels that,

               zoning alone cannot effectively control sprawl. Controlled public investment

               is probably the most muscular tool that can be used to guide development. This

               has the potential to be even a stronger tool for guiding development than

               tra ditional land use planning  zoning. That is what the Committee tried to

               emphasize strongly.

                    It was agreed to change B-4 to read  "Public and publicly supported facilities,

               services, Institutions and facilities.shoulA be  located in accordance with the

               policies above, for example publicly supported services should be located so as

               to serve urban,concentration. Recent school and other,service location    decisions

               often have been contrary to this approach".

               C. Promotional Programs

                    Mr..Blondl asked how one goes about promotional  programs. Who does the

               public educate in this area (beyond publishing the Commission report)?

                    Mr. Larson said the Committee felt that you have to go  beyond the  enunciation

               of. policiesand programs, particularly where you're trying.to make recommendations

               that are new. The suggestion was made by the.Economic D  evelop ment Committee that

               the Commission continue as an educational and monitoring group beyond the

               original life. The Commission should explain why they made these recommendations,

               in order to get the public to want to.develop that way.

                    Mr. Biondi asked If anybody, except the people in the  planning department,

               when they publish various district studies, and explain their rationale, convey

               to the public the general ideas behind what's happening.,

                    Mr, O'Donnell noted that New Castle County holds an  extensive series of  work-

               shops for that purpose.

                    Mr. Biondi stated that there is-a problem in that many  people dontt see.

               anything wrong with stretching development along Delaware's  roads. He asked
<pb n="392" />

                                                          8

                how you go about changing their minds. Mr. Bradford said       that this report

                shouldn't necessarily spell out what the educational process-should be, however

                it should be indicated in this report that.there will be follow-up (the reasons

                for and against the recommendations will be     explained).

                     Mr. Biondi noted that, as   past experience has    shown, the public express

                concernonly when something physical happens directlyatfecting them. This Is a

                problem the Commiss.lon should address in greater detail, as to how to get the

                public interested at all in the Commission's report. He said that "if. they all

                come out and disagree with it, it will be    an accomplishment",.

                     Mrs. Greer stated   that she  felt that the vocabul  ary used  In this, report

                needs to be simplified,   in order to get the report into terms    that the public can.

                understand. The way the     report Is received  and the vocabulary used is going to.

                go,@a long way Ln: getting the public support..@

                     Mr. Biondi agreed that simplification of this report Is       In.order. There Is

                also a problem with creating.public interest in State problems. Mr. Walton noted

                that he is disappointed In the attendance at the Commission's meetings.,

                     Mr. Weiner said that Section C Isapplicable to the entire Commission Report

                and should be extended to cover It.

                     Mr. Biondi stated that the Commission members      ought to. understand, in a

                precise manner, what  we are discussing and dealing     with.  After the Commission.

                understands this, there Is a problem communicating      this to the public.

                D. Jurisdictional Arrangements

                     Mr. Russell suggested that   Section D be held,  in abeyance  until the dis-

                cussion regarding paragraph 4 on page 5 Statewide,Standards.

                     Mr. Weiner pointed out that D-6 doesn't quite      have anything to do with

                jurisdictional arrangements.    Mr. Weiner moved that.item D-6 be     stricken.

                     Mr. Biondi asked for the   meaning of D-6. Mr. Weiner expressed concern with

                the phrase "of  servingthat development% He felt that.th.is impli,es services
<pb n="393" />

                                                           9

                outside of the development. It was agreed that this policy        should be uniform

                statewide.

                     Mr. Chamberlin pointed out that in any zoning hearing       overa proposed new

                development, the public points out that this development will cost the people who

                are already in residence varied amounts     for additional facilities (police, schools).

                The new development should (in the sense.of some sort@of capital grant-in-aid)

                pay for these additional facilities, which would be Indirect or external. costs.

                The basic effect of that is to suggest that those.capital facilities be.financed

                through mortgage on the house rather than some form of municipal indebtedness,

                Mr,. Chamberlin felt that this is a   mistake because the.consumer ends,up paying

                probably twice.as much.
                      Mr. Biondi suggested that policy D-6    is c losely related.to what's being     done'

                in New Castle County under the planning concepts at the present time, however,

                this policy would make quite a difference     In Ke nt and Sussex Counties.

                    Mr. Larson said that policy D-6 wa    s, intended to try to find a way that those

                newcomers would meet the incremental costs of areawide or communitywide improve-

                ments necessitated by the fact that a new development had come into an area.

                Mr. Chamberlin expanded on this by,suggesting adoption of.the user charge

                concept.

                    Mr. Weiner   felt that the words "user charge concept" should be stricken.

                from D-6. If there is an abusive practice existing, then that should be addressed,

                however', a new.concept has been developed regarding user charge      concepts. For

                example, the Highway  Dapartment came up   to New Castle County and said together

                with New Castle  County Planning Department, that If the corridor area Js going

                to grow, it was  suggested that the people living there will-now.pay for major

                public highways  out of their pockets at 9-10% interest on the@ir mortgages

                instead of using public,financi.ng under tax,exempt bonds and programs that
<pb n="394" />

                                                          10

               everybody else In this    State has always received for public growth. That is the

               user charge concept of    serving those developments that's been proposed in New

               Castle County. If the     Commission is talking about a different kind of problem,      .

               it should be made very    clear, if not then the Commission     should be very careful

               about the wording, as    it could beeasily misunderstood by laymen.

                     Dr.*Latham expressed confusion over two aspects of Mr. Weiner's statements.

               One is the funding aspect. He didn't,see the connection between having users

               pay for services and necessarily financing It privately. The other side Is whether

               or not the  users should be   paying for   It. He suggestecl@that maybe what's missing

               is an additional statement    that says 11where costs exceed benef.its". There are also

               benefits  derived from additional development. It Is a        narrow concept to say that

               additional costs are the only impact of development on        the community.

                     Mr.@rO?Donnell,  In respbnse@to-Mr. We1ner'-s-statement,    said that as

               far as he knows, New Castle.County Planning Department        has not endorsed user.

               fees in the area of   corridor transportation.

                     Mrs. Smith said  that If the Commission Is talking      about trying to   control

               growth and channe  I It  through the publiciacilities, there are totally        unmeasurable

               benefits that accrue to people who can     .af f ord to and. choose to .11 ve outs I de. urban

               concentrations. If you're going to talk about user charges, it may be necessary

               to measure what benefits accrue to someone who l1ves on 10 acres with the fact

               that he can have   others channel Into concentrations       so he can have his 10

               acres.

                     Mr. Biondi  stated that government has    some responsibility to help people

               find  a decent place to live and    provide some governmental support for doing

               that.  The theory of government     is thatrpeople come together and,pool their

               common  resources and do things overall for the benefit of the entire group that

               they couldn't otherwise do. He stated,that.."if,we're getting down to the concept
<pb n="395" />

               of user charges, then maybe we ought to get down to    whether we  need County

               and State governments to start with.

                    Mr. Bradford stated that he was concerned about carrying     the user,charg6s

               to the absurd. He was also concerned that D-6 mentions "incremental costs"

               which mean an additional cost brought on by some addition which requires a      new

               unit, and  it's possible in places that have sufficient capacity - there might     be

               no incremental costs in the sense of capital,costs foradditional people liv-In     g

               there. On the other hand, if    you're trying to develop in   a place.that Is

               concentrated already - that may be just    the straw that  breaks the camel's back.

               Therefore, incremental costs may assess    someplaces and  not others.

                    Mr. Biondi stated  that when all the   different branches of  government come

               together and approve a  development In a   certain location, then  the government'

               has exercised its clout  and therefore, these incremental.costs    are a public

               responsibility and a part of the whole governmental system of     cost. Why do   you

               have to add a punitive tax system on top of a regulatory system.

                    Dr. Latham felt that a distinction should be made between the different

               kindsof benefits that are provided. Certain ki.nds of benefits are so direct to

               the consumer that they ought to pay for It, such as      streets, and utilities inside,

               of development,  etc.

                    Mr. Biondi  stated that this is accepted.    Oe,ople havealways built homes and

               built their own  roads to connect with the maln-roads.. The.same thing is done in

               developments, however  when you get away fromdevelopments and start talking about

               incremental governmental-costs, what-youl-re really doing is talking about

               assessing a different governmental cost.

                    Mr. Kreiger felt that policy D-6 is very discriminatory. He      felt that

               D-6 would be a deterrent to people coming into Delaware.

                    Mr. Larson seconded,Mr. Weiner's motion to delete,D-6 saying that      if all the

               other policies work, this policy   won't be needed. This policy was    designed among
<pb n="396" />

                                                        12

              other  things, to got  at the problem  of  sprawl.

                   Dr. Latham stated that he agreed with Mr. Larson      to a certain extent in that

              all the other policies an  d the user@charge concept are substit    utes for each other.

              If you perfect the user charge concept appropriately, you don't need any other

             .policies. Growth will go where It's most economic, it will@make use of already

              existing facilities, etc. However, if.you use the other policies talked about

              concentrating developments without regard.to.cost, then you,may be raising the cost,

              of,development, raising the cost of people to.f,ind better homes and a better lite.

              It will be impossible fora person whowants to get        away.from concentration   and is

              willing to  pay a very high cost to be able to do     that. .,These policies'wil.1  be,

              Imposing on people a decision about where they must live,       Instead of letting

              them take the budgets they have.available     and deciding for   themselves If it's

              worth,payinq the ful.1 cost-.-for what they want to.do or not.

                   Mr. Biondi said welre talking about the average man making $10,000-$15,000

              a year. Dr. Latham said there is.no conflict - that man could*never afford

              to live outside the concentrations, he would never be making       that choice..

                   Mr. Chamberlin d1sagreed with Dr.     Latham. He,said.many    examples of when

              someone  purchases 2f acre lots off of afarmers      field and.puts in.a couple of

              septic tanks, runs the dry waste down a country      road and on  down a road, that's

              the che.aoest.way and where's your user cost?.That's sprawl.

                   Mr. Weiner   felt that pollcy,D-6 is a very   specif.ic policy  aimed at  a very

              specific group of people, He reiterated that this policy should be stricken.

              On the issues  of  user costs, Mr. Weiner stated that he always felt.that      our basic

              ,policy was to try  to get people to be able to live within our society so       that
              those who had  more paid more taxes, in a progressive tax fashion. Example: a

              man making $50,000/year Is probably.using the same amount of       water (or less) as

              the man making $7,000/year. Yet the $7,000      pays the same as   the.$50,000.
<pb n="397" />

                                                       13

                    Mr. Cooperson said It is  not   possible for any economist to determine what

              the incremental, cost is for one individual   person to do that. He doesn't see any

              possible practical way of assessing fairly    a user cost, therefore, why even

              entertain it as a serious way of taxation.

                    All present were In favor of striking   policy D-6 as moved by Mr.,Weiner.

              Agriculture and Farmland

                    Mr. Walton gave some background on this policy. He stated that the problem

              with farmland preservation is that farmers,,like everyone else, are entitled, to

              reasonable returns for their life's investment.on their property.. The farmers

              are not complaining about the existing system. The concern should.be with New

              Castle County where the greatest population Is because youdon't have 10 acres a

              person for everyone in this State.      His position is@to preserve farmland for

              the future.

                    Mr. Biondi asked how much farmland In the State is prime farmland? Mr. Walton

              answered that 413,000 acres Is prime farmland.   classified as 1., 11, and 111. He

              further explained that to make Class I land an.economical agricultural unit, it

              will be mixed with Class 11 and III land which is.drained. The net income of

              Class III land is comparable to prime land. Any type of      Classl, 11, and    III land

              can be economically farmed if it's in proper economic units of agriculture.

                  'Mr. Biondi asked what percentage of undeveloped land in the State is classified

              as prime farmland, Mr. Walton said that of the 413,000 acres it could all be

              considered prime farmland and worth preserving. He said'.he isn't sure.if forest

              and timberland is included In this     figure, however there are  several.companies

              buying timberland In southern Delaware harvesting.large crops     of timber. That

              takes up Class III land right to the digit. Class I land in      Delaware is located In

              Dover, Middletown and Bridgeville.
<pb n="398" />

                                                        14

                    Mr. Weiner agreed that prime farmland, as much as,is feasible, should be

              protected and preserved so It can    be used for those purposes.

                    Mr. Biondi stated that if you're talking about a policy for preserving prime

              farmland and coming up with tax incentives, he felt-th.at you're saying there

              should be some public policy decision that this land ought tobe preserved as

              prime farmland. He asked if that's a.pu     blic policy deci,sion within.  that context,

              should the decisionbe left     to the farmer, whether-or not to    farm his land or

              will It be a system of governmental controls where land is farmed.regardless?

                    Under  Implementation,  Mrs. Smith questioned the   phrase '.'investigate the

              use of incentives In addition    to the Farmland Assessment Act". She asked if

              they,'re saying that the Farmland   Assessment Act. has to be a basis,for any

              program of implementation. Mr.     Larson answered no, because it    is already In

              effect.

                    Mr. Kreiger suggested that the last three sentences     of paragraph one

              under implementation be clarified to say     that the  tax.should be on fair market

              value as farmland.

                    Mr. Biondi suggested that the fourth    sentence under Implementation.be

              amended.to read "Another Incentive Is modification of estate.and inheritance

              tax laws to insure the orderly transfer of     agricultural land so that value is

              based on agricultural use rather than,fai.r.market value at Its highest and.best

              use. This amendment was agreed to by all      present.

              Conservation and Open   Space

                    Mr. Kupnnen explained that after he    submitted  his minority  report on

              Finding Num ber Two the wording was changed    which answered his concerns.

                    Mr. Walton clarified on Finding Number Three that he's saying t      hat what-

              ever is deemed to be open space has a right, in itself, to       be open space and

              not necessarily  to be a residual of all that isn't developed. It was moved
<pb n="399" />

                                                               15

                @that this finding be amended to read       "Open space   should not automatically be

                regarded as land awaiting..6111.@,'
                      Mrs. Slights   stated that    this  Finding  Three.  was:'meant to address the feeling

                that we should have certainl6reas       that are    considered  open  space and they are not

                holding grounds for future development. That does no           t mean.al.1  open space that

                has never been developed but rather alcertain or specific percentage of open space

                that will stay    as such.

                      Mr. Walton pointed    out that the    State owns 40,000    acres for   parks and

                recreation. That's open space.

                      Mr. Bradford asked     if there   is a method   by  which open  space   I-and can be

                transferred by an act of. the Genera I Assemb ly.     from open space to some other use.

                Mr. Webb sald a piece of open space land         can  be.sold the same    way it was purchased.
                      Mr. Russell asked what Is the process for changing a restriction in a deed.

                Mr. Weiner said complete concurrence        of everybody   who has any right in It Is

                required.

                      Mrs. Smith asked in.the statement "Open Space should not be             regarded" who

              .would be doing the regarding? Mr. Walton said this refers to everyone, State

                agencies and the public, as well as the private developers.

                      Under policies, Number One was       agreed to by all present.

                      Policy NumberTwo, was deferred       due,tollis.'-,-,connection to  the coastal    zone

                controversy.
                      Mr. Biondi asked Mr. Kuennen what       hi s objections were    to  Policy Number   'Three.,

                Mr. Kuennen said again, the wording had        been changed since     his.objections were

                ral.sed and he agrees with the statement       as rewritten. Policy       Number Three was

                agreed to by all present..

                      Policy Number Four was agreed to by        all  present.

                      Mr. Biondi asked the meaning of Policy        Number Five. One      of the most critical

                problemsin land use is the amount of useable,water.to be available for              future
<pb n="400" />

                                                   16

             development. This is one of the most@limltlng factors In some areas.

                 Mr. Biondi stated that this policy cal.ls for flexperimental collection,

             retention and water recycle systems". He felt that the policy should call for

             development of,water resources.

                 Mr. Cooperson felt that the word "experimental" is not heeded. Alot

             of the technology for water recycling is already there and has to do,.with

             the willingness of governmentto comm[t capital In that.direction. Secondly,,

             he felt that the development of water resources Is addressed-in this policy.

             Recyclingis a way of developing water.resources.

                 Mr. Biondi asked why the Committee was concerned.with experimental,methods,

             of collecting when there are some time honored methods of, getting water resources

             that just require public Investment. Mr. Cooperson said that he's talking about

             once through systems, which are ultimately self-defeating.

                 Mr. Weiner felt that Number Five Is poorly worded. He felt that the

             Committee was trying to say that we should "support collection, retention and

             water recycling systems as one of the means for insuring an adequate water supply

             for agricultureP industry and community development". This policy should.be

             reworded to say that. Mr. Kreiger questioned the use of the word "support"..

             Mr. Weiner said that meant financially, Idealogically, Intellectually,

             legislatively, judicially- everyway possible that's good for the country. The

             Commission agreed to accept Policy Number Five as.,reworded by Mri Weiner.

             Implementation

                 No objections or'comments were raised on Number One. On Number Two Mr..

             Russell.noted that Secretary Bryson had previously questioned whether you could

             indeed, finance the massive public expenditures through boat licenses and park

             fees.and general property taxes.

                 Mr. Biondi felt that Number Two.ls looking.for some regular commitment of,
<pb n="401" />

                                                     17

              @a percentage of capitalfunding, for example.

                   Mr. Weiner felt that this paragraph was confusingly written. The    point

              being raised is that  public expenditures.for acquisition of open spaces through

              the use of municipal  or State bonds would be paid for by special taxes and.fees.

                   Mr. Biondi noted  that if you're saying that you should pay for open,space

              acquisition by bonds  financed by certain special taxes, then what youtre saying

              is that public expenditure for open spaces'doesn't have a very high priority.

                   Mr. Russell suggested that the wording be changed so as to read: "Open.

              Space wi'll be acquired by expenditure of public funds". He questioned.the

              definition of open space and asked if this eventually means park land., If so,

              this could pose a problem as it has in New Castle County     who owns approximately

              3,500 acres, half.of which is undeveloped'. due to the fact.that this is such a,

              large capital commitment to develop.

                   He explained that  he was trying to point out what might be a future problem.

              If You're talking about open space that will remain undeveloped because you donft

              want development and it's going to stay undeveloped     that's one question. If

              you're going to purchase land to make open space and then develop.it, then public

              expenditure becomes.a real priority problem.

                   Mr. Biondi suggested that Number Two be changed to read: "Public expenditures

              for acquisition of open space should have a high-priority". This was agreed -to

              by all present.

                   No objections were raised on Number Three.

                   Mr. Cooperson said that he participated in the@Christina Basin Study. He

              explained that there were two phases of the Study'. The first part dealt generally

              with water resources and planning  development policies; the second phase dealt

              with an examination of specific measures for land development. He felt that

              Number Four is so helplessly vague  that It's meaningless becausethe first phase
<pb n="402" />

                                                     18

              had to do with the whole approach  to planning and he wasn't sure that any of

              th@@se measures, such as were analyzed in that study, could be put into practice.

              T@Mere were no specific recommendations that could be put into practice. The

              second phase is a compendium (a @handbook and a listing) of a whole.multitudb of

              development practices for this area and other areas,in the county. To say in

              an unselective kind of way those practices should be.required by the State is

              meaningless. Which  pract Ices? Some of them may,be in conflict with one another

              and may not be appropriate to this area. He, therefore, moved that Numberfour

              be deleted due to its. lack of specificity. This move   was seconded and agreed

              to.by all present.

                   Mr. Cooperson further suggested that it be@notedthat many of the measures

              in the Christln-a Basin Study which did deal wit.h responsible development practices

              should-be seriously loo-ked@'into and possib ly adopted by various governmental

              jurisdictions In the State.

                   Number Five was agreed to by all present.

                   Mr. Bradford again expressed concern with.the lack  of a clear definition

              for open space. He explained that everyone has h1s own   ideas of what open space

              is. Since this is a title of a section, this, should be  clarified,

                   Mr. Biondi asked Mr. Kuennen and Mr. Larson and  members@of the Land Use and

              Community Development Committee to come up with.a clear,definition of open space.,

             .that fits within the context of this report.

              Residential Land

                   Mrs. Aughey submitted a minority report.expressing her concerns with the

              wording in this section. She  felt that Policy Number Two should be reworded to

              state."Delaware must assume leadership in helping people     She also said that

              housing Is a.human need   not a right. She said'you have   a right to.those things

              which you.are willing to do something.about    it,is not the governments obligation
<pb n="403" />

                                                         19

               to provide you with  a house  or food    except in the   case of children or disabl.ed

               people.

                    Mr. Wei.ner said he  had no objection  to changing  the phrase "Housing is a human

               right" to read "Housing   is a human need". He felt that this doesn't change the

               th.r 6st of what we have to do.

                    Mrs. Aughey stated that her main concern was with Policy Number Two the word

                assume    She felt this should be changed to "Delaware should assist".

                    Mr. Weiner pointed out that In Mr. Kuennen's Minority Report the point        Is

               raised that It's a cop out to believe.that Delaware shou-id take over the.

               responsibility when to a great extent the federal government has not       been doing

               their job.

                    It was  suggested that Policy Number   Two should   be changed to read "Delaware

               must assume a share of  the responsibility   together with  the federa.1 government.,

               of assuring housing for  those who, because   of their physical, social or economic

               condition, are not adequately housed by private market"., It was moved       by Mrs.

               Slights and seconded by Mr. Keifer that this policy      be adopted as amended. All

               present agreed.

                    Mr. Biondi noted that two county representatives were tither opposed or

               not voting on Policy Number Three. Mr. Cooperson explained that they felt that

               what was being sought in this policy,was a loss of control. by the county@of their

               governmental prerogatives.
                    Mr. Biondi asked whatare    the laws  that are  "those  laws that inh-ibit".

               Mr. Kuenneh said there is a   Whole line  up.of agencies  that you have to go through

               with different regulations   (forpermit   procedures and  zoning ordinance). The

               State should have a common   set of procedures and permits, etc. for construction.

                    Mr. Cooperson questioned who    is defining which laws are.inhibiting develop-

               ment. What the Committee was looking     for was a simplifi cation and a reasonable
<pb n="404" />

                                                   20

             consistency among regulatory agencies and also laws that would encourage people to

             maintain and upgrade the properties that are, already.held. He asked if this

             policy could be construed to mean advocating the lifting of all zoning and

             environmental legislation because somebody in the development community.feels

             It's Inhibiting their ability to make houses. Mr. Cooperson felt the policy

             should be rewritten.

                  Mr. O'Donnell thinks the intent of this policy.1s for the developer to

             know (for example) that In any place in the State,when it has put,a catch basin

             in   he knows what they're talking about and there aren't three or four different

             interpretations.

                  Mr. Weiner clarified that this policy Is intended to.say "Let's have

             equitable, effective housin
                                        g and land development control regulations that are

             app I I cab Ve' and  workable.'.'

                  Mr. Walton explained that housing codes and building codes were not stated

             in this policy because there may be other regulations andthey couldn't all be

             enumerated.

                  Mr. Chamberl in said that this policy was suggested because of the

             frustration that exists In trying to process a piece of land, for any use.. through

             the various public agencies at various, levels. He doesn't think anyone could.,

             sit down and list (for residential use forexample)  all of theagencies  and all

             departments within each of those agencies you'd have to clear@through@b.efore you

             could "break ground". In addition,  the substantive areas of regulations are so

             intermingled and overlapped that It is Impossible to know when you've gotten an

             approval or not. This is a system that is expensivej, time consuming, irrational

             and unreasonable.- It Is more like a. maze than a process..

                  Mr. Biondi asked Mr. Chamberlin and Mr. Cooperson to rewrite and clarify

             Policy Number Three.
<pb n="405" />

                                                          21

                     on Policy Numbe.rFour# Mr.    Biondi asked,   if they weren't trying to lower    the

               rate of escolation. Mr. Weiner      said he felt  the  Commission should support     this,

               policy.

                     Mr. Walton explained    that he opposed this policy   because he.feels It     inter-

               feres with the   free market  I and compatitiveness.He felt  that the consumer.gets the

               cheapest costs   when there  is competition   between.developers.and builders..     He

               felt that when   the State steps   In, it ends.up  costing the.consumer.more,

                     It was moved and,seconded    that Policy Number Four be.,adopted    as_w.ritte.n.

               Mr. Walton was the only no vote.

                     The Implementation section was accepted      as written.

               Comynerc I a ILand

                     Mr. Biondi  asked what is  meant  by  Finding Number   Two.  What is meant   by

               regional? Mr. Walton explained     that Is.a shopping   centerof   a certain.size that

               servicesla certain area (not local. shopping,centers) for.example, Tri-State,
               Concord and Blue Hen Mail.     Sussex County c  an't suppo rt a regional mall and

               Dover can't support another mall (one just went bankrupt).         There was discussion

               on whether New Castle County could.

                     it was moved and seconded that    Number Two_be   stricken.   All  present  agreed

              -except Mr.. Walton recording the on.ly no.vote..

                     Mr. Weiner expressed,concern over    Finding,:Number Three.    He.stated that

               other  ventures were  not asked to give market,analyses,and      many marketranalyses

               a re not accurate.

                     Mr. Biondi stated thata market     analysis  doesn.1 t a.1 w Oys guarantee success

               in any commercial venture. However,      h,els never seen  a commercial  venture on

                                               rable market analysis.     He suggested   rewording this
               which you couldn't get a favo"

               finding to read "A commercial developer     should  be  expected  to show economic

               justification for a project".
<pb n="406" />

                                                           22

                    Mr. Walton said the point of      Number Three was.that    the taxpayers    of-this  State

               are required to make sizeable expendituresfor commercial development            (in the  form

               of overpasses, intersections     and drainage ditches) and      it's unfair  for the   tax-

               payers to.participate-in the     bankruptcy of   afinancial     venture.,

                    Mr. Biondi said at    the present time the.complaint       Is on the behalf.of    the

               developer  that they are   being compelled with     the,economics of aproject, to       solve

               governmental problems.'   In terms of highw.ays,...sewers.and.,drainage, th   .at pre

               existed the  development. This      Is happening   ln.New..Castle County.

                    Mrs.  Aughey felt that Number Three      is of.no particular use simply because

               you can get  a market analyst or a consu.1tant to g,ive,you,almost anything. This

               is  something that the judgement of the people of       planning departments     of the

               counties should consider as part of their decisions.

                    Mr.-B.Iond'i noted that   there-Is no proven method      by which to  determine   a

               successfu  I business venture. It really takes a variety        of people In the money

               market,  the planning market location, etc. to come        to,.a decision on a successful

               location. -Market   analysis Is just one of maybe 10       factors that go Into this

               kind of  a decision.    Mr..Blondl objected to market,     analysis  being Isolated when

               many other  factors are equally    as Important.. He suggested that       Finding Number

               Three be   amended to  read: "A  commercial de.veloper..should   be  expected to justify

               proposed   commercial  development and show need for.such.development...It was          moved.

               by  Mr Walton and.seconddd     by Mrs.   Slights that  Number Three   be.accepted   at

               amended. This    was agreed   -to by atl present-,

                    Under Policy   11 1, Mr. O'Donnell    expressed,concern wIth,the      Word,

               "disperses      He stated   that this term   Is contradictory.      If  traffic.were
               dispersed,  there  would  be no  problem.    He suggested    this phrase  be changed.. to,
               read "Commercial   strip"development-that impedes traffic       flow   throughout,,'".

               This policy  was agreed to, as.amended,--by     a.11 present...

                    Mr.,Kuennen explained his opposition       to Policy Number Two.      He felt  the
<pb n="407" />

                                                        23

               frame of reference  dealt with New Castle  County and he felt that this policy

               couldn't be implemented in lower Delaware. He felt this.statement should be

               more specific.. Mr. Biondi suggested the addition.of the phrase "where strong

               core districts exist" to the end of this policy.

                    Mr. Weiner felt th at Policy Number Two would-discourage commercial develop-

               ment in the rural suburban fringe at the   expens.e.of moving all of it into the

               central business  district. He felt that   this policy needs another sentence. He

               feels that we should encourage commercial   development in and around existing

               central business districts, however all commercial development should be designed

               to provide services to people and should be located in ways that will accomplish

               that purpose.

                    Mr. O'Donnell asked what the term   "around" means. Mr-Biond! agreed.that if

               you're talking about encourag  ing development In downtown central business distri   cts

               like Dover, Wilmington or Newark, you have to strike out "and around".. This was

               agreed to by all present.

                    Mr. Walton agreed that the purpose of this policy was to'help existing

               downtown business districts.

                    There was much discussion as   to whether Policy,N,umber Two was referring only
               to downtown Wilmington or if this   was to be a Statewide policy. Mr..Biond    1

               suggested that this policy be amended to read: "Major commercial development

               should be encouraged.in existing central business.districts". Th.is was     agreed to

               by all present.

                    Mr. Kreiger asked the meaning of the term "incidental" in Policy Number

               Three. Mr. Webb   felt this.meant adjacent  to. The discussion against the regional

               shopping center said It would create its   own growth and you would have to    justify

               large concentrations in that area.

                    Mr. Biondi noted that this paragraph is   clearly not related to the Wilmington

               problem.
<pb n="408" />

                                                       24

                    Mr. Chamberlin explained that-a regional shopping center,generally includes

               two department  stores, reqvires In excess of 40 acres    of land, has somewhere.

               around 400,000  square feet of retail, saies area and   will draw customers from

               approximately 30 minutes  travel time. There is'no true regional shopping center

               in Delaware at  this time.

                    Mr. Walton  said this policy was meant to be in conjunction with the idea

               th  at we have enough regional shopping,centers.. The Committee also meant this

             @policy to discourage shopping centers f.rom locating In areas where it would

               encourage other development  to come to it. That.1s.wh.at was meant by the

               phrase "incidental to urban  areas

                    Mr. Blondi@raised several points.concerning    regional shopping centers.    (1)

               They kill off all small commercial. development around a regional shopping center,.

               to'some-6xtent.' (2) They-don't draw from a specific urban area, they draw from

               a wide market - counties.surrounding Delaware as well as from     within the State.

                    Mr. Kreiger suggested that Policy Number Three be deleted, because he felt

               that this policy is not in   line with discussions on developing Delaware. He also

               felt that this policy implies      a lack of trust in the County,goyernments to

               enforce their zoning laws. Mr. Walton said, the Counties' tract records were not

               much better than the State's when It comes to enforcing effective.development

             'policies.

                    Mr. Walton explained that   he didn't vote on this policy because    he felt that

               If the money interests wanted to bui.1d ashopping center, and saw.it      as an

               effective market, he had  no objections  to it  being built in the proper area,

               however he felt it should be "incidenta,l to   the urban areas" and this wasn't.

               defined clearly..

                    Mr@ Biondi found   the term Iturban areas" to be rather vague*

                    Mr. Kreiger moved that Poli.cy Number Three.be stricken    for the following

              .reasons:
<pb n="409" />

                                                        25

                       (1) There isn't a good definition of the term "regional     shopping center".

                       (2) It's not clear  what's meant by the term "incidental".

                       (3) This policy is  anti-economic development.

                    This motion was   seconded by Mr. Oldach. All present voted in favorexcept

               Mr. Walton recording  the only no vote.

                    Mr. Cooperson said that, as    far as he understood,  the objective of the

               Delaware Tomorrow,Commissi,on was  not simply to look at   ways of encouraging

               business, what we're concerned with    is the total environment and,people of the

               State of Delaware.

                    Mr. Biondi asked  what was meant by Policy Number Four.. Mr. Cooperson

               noted that this policy is just a restatement of theconcern in Policy Number

               One. Automobile-oriented uses do tend to take up alot of street frontage. It

               gets back to the Idea of Impeding traffic flow..

                    Mr. Weiner as-k ed If this  pol,icy was trying to say that automobile repair,

               shops and dealers should   not be strung out along the highways. He felt it should

               be stated that way,,
                    Mr. Chamberlin felt   that the scale  of this policy'is ina  .ppropriate for

               the deliberations of the   Commission. This 1-s only one type of commercial

               development we're concerned -- with what about other types?

                    Mr. Wafton said that automobile repa   ir shops was just an example and   could

               be stricken. Mr. Weiner    said that then  you're saying the same as is stated in

               Pol icy Number One.

                    Mr. Biondi suggested   that Policy Number One be revised to say: "Commercial

               strip development, including highway   oriented uses...".
                    Mr. Walton pointed out that Number One says."curtail" and we      don'twant to

               curtail highway oriented uses,   we want to concentrate them.

                    Mr. Biondi then suggested   Number Four be changed   so as to read:  "Highway
<pb n="410" />

                                                   26

             oriented uses should be clustered and not strung.out along major highways".

             This policy, as amended, was agreed to by all present.

                  Mr. Biondi moved that the meeting be adjourned. The next meeting of the

             Commission will be on Monday, June 16, at 4:00.p.m. in the Cabinet Room of the

             Townsend Building, Dover.

                                                    Respectfully.submitted,

                                                    Dee Burki
                                                              e.y
<pb n="411" />

                                           STATE OF DELAWARE
        DAVID R. KEIFER                      PLANNING OFFICE                         PHONE: 1302) 678-4271
           DIRECTOR                                DOVER
                 Ref: .1007/1404

                                     DELAWARE TOMORROW COMMISSION

                                Minutes of Meeting of.June 16, 1975

                      A meeting of the Delaware Tomorrow Commission was held on June 16,   1975,

                 at 4:00 P. M. in the Cabinet Room of the Townsend Buil-ding in Dover, Delaware.
                      The following members were present:

                      0. Francis Biondi
                      David R. Keifer
                      Ernest W. Thorn
                      John Walton
                      Joann D. Slights
                      Ross E. Anderson, Jr.
                      Carl S. Oldach
                      Fred G. Krapf, Jr.
                      Joseph Golden
                      Theodore Ryan
                      Secretary John D. Daniello
                      Secretary J. Thomas Schranck
                      Peter A. Larson
                      Dorothy Greer
                      Secretary Clifford B.,Hearn,  Jr.
                      Mayor Crawford J. Carroll
                      Marcie Bierlein
                      Secretary John C. Bryson
                      Carl Russell (voting proxy for Mr. Mel Slawik)
                      Secretary Clifford E. Hall

                      Also Attending:

                      Dr. William.,R. Latham III
                      Daniel Kuennen
                      Bernard L. Dworsky
                      Peg McClane.
                      Rita Smith
                      Spencer Thompson
                      Rama Singh
                      Ed'ward O'Donnell
                      William Bradford

                      The meeting was called to order  by Chairma,n Biondiat 4:25 P.M. At

                                                             EXECUTIVE DEPARTMENT

                                                                SHERMAN W. TRIBBITT
                                                                         GOVERNOR f)F
                                                                                      JL,,Av
                                                                                          MR.E.
<pb n="412" />

                 Ref: 1007/1404                       -2-

                 the last.meeting,  the Commission discussed the Land Use Committee

                 Report up to Page  15. Mr. Biondi noted that there had been some ques-

                 tion as to what was meant by "open space." He. had asked Mrs. Slights, Mr.

                 Walton, Mr. Chamberlin, Mr. Larson and Mr.. Kuennen to get together and

                 define "open space" as it is used in thts report.      Mr. Kuennen circulated

                 a memorandum on the subject to these people and.there were no objections.

                 This memo will, be sent to the Commission members and    at the next meeting,

                 all referrals to "open  space" in thi s report wil'l.be  reviewed based upon.

                 this definition of open space. Any changes necessary      will be made at

                 that time.

                 MAJOR INSTITUTIONAL  LAND'USE

                      Mr. Larson explained,that the Policy under.this section     was   inserted

                 primarily to try to get at the problem,of the lar
                                                                     ,ge public and private

                 institutions that have resources for planning, land acquisition and develop-

                 ment of its own, outside the context of government. This policy was also

                 intended to reinforce the basic policies on land use containedlin this report-

                 which is to encourage urban concentration. The Committee felt that with a

                 policy that directs and encourages institutions to conform to State      and

                 local land use planning  we Will avoid that kind of situation in the     future.

                      Mr. Biondi asked if this policy is consistent with policy.#l on      Page 4.

                 Mr. Larson said they were consistent.

                      Under the implementation section, Mr. Larson    noted that this   could only

                 be accomplished through Legislation, essenti,ally-to   force institutions to

                 cooperate and conform to local or State plans.

                      Mr. Russell asked Mr. Larson what   would be done with existing facilities

                 that are in place- they don't meet the   required land use plan, but they have
                 been there so lon Ig they have been grandfathered out. Mr. Larson stated that.
<pb n="413" />

                Ref: 1007/1404

                he, personally, felt these facilities would    have to be grandfathered    out

                and start from scratch with new facilities.

                      Mr. Biondi asked: Assuming you have an    institution which is going   to

                purchase or acquire land, and they obviously    are going to do  it to render

                some service. Thev have been in the business     of rendering service-for

                some time and know more about the need    for that service than virtually    any-

                body else; however, the County authority like    the County Planning Office

                comes into the picture. He asked if it     wasn't possible that the people

                investing  substantial funds for providing this   service know more about

                what they  are doing than the County officials.

                     Mr. Larson said that in his experience, the institution is often not

                the best one to make this decision, because they are toDtied up in their own

                service that they fail to see their impact on the total community.

                     Mr. Biondi asked if this was a problem in Kent County or Dover. Mayor

                Carroll said it was  but it is solved now. He said there are cases'where

                public institutions   lease out properties to private enterprise for either

                income or other uses, because they don't have any use for them. For example,

                Wesley College  leases out to other enterprises for income, so the City taxes

                them.

                     Mr. Russell stated that he felt "private institutions" was     not referring

                to public education. He felt this meant a non-    profit agency 1 ik e United Fund

                In many cases,  these kinds of agencies have to accept Where    they can go.

                For example, they are given a property from someone in a will. They      cannot.

                start from scratch  and abide by an adopted land use plan and go where it is

                most profitable. They also get in cheaper or at no cost because it      is non-

                profit. He asked if you cab    make them comply.
<pb n="414" />

                 Ref:   1007/1404                      -4-

                       Mr. Russell further stated     that as far,as   implementation of a tax
                 exemption policy, New Castle County is revising        what was adopted two (2)

                 years ago in a constitutional amendment to take        all the tax exemption

                 policies under the County's wing and figure out        who is getting what.     This

                 is an immense project as it is done today,., To       rethink that will be an

                 enormous administrative rethinking.

                       Mr.  Larson suggested revising    the language under    implementation,   to

                 bringthis statement in line with Mr. Russell's because the word "continu-

                 ation" might imply no grandfathering.. He also explained that the reason the

                 words "private institutions" were used is because public institutions.are

                 already tax exempt-,private.institutions have to specifically apply.forand,

                 receive exemption either from the      municipality or the State. He suggested

                 the implementation.section be amended      to read   "Privateinstitutions seeking

                 tax exempt status should comply with adopted        land use plans."

                       Mr..Bry§on asked if this means that private institutions not seeking

                 this status don't ha   ve to comply with the land use. plans? Mr. Larson said

                 he presumed those would get caught in the normal.land development process.

                       Mr. Russell stated that another thing the implementation process          does

                 not mention is making    the public tax supported institutions abide by, not

                 only  the land use   plan, but also the drainage codes, sewage codes, etc.

                 That  is where the   problems are with   local governments.

                       Mr. Larson agreed with Mr. Russell and said he would,agree to inserting

                 "and  tax  supported institutions" after "private-institutions seeking tax

                 exempt status."

                       Mr. Biondi felt that    there was  a gap between the,   policy  and implementa,-

                 tion  of the policy. He felt the policy ought to be amended to read: "Public
<pb n="415" />

                 Ref- 1007/1404                         -5-

                 and tax'exempt privateAnstitutions,     services and facilities should    be

                 located so as to serve urban concentration and should comply with land

                 use, drainage, and other regulatory plans" This amendment,was adopted        by

                 all present.

                      Mr. Russell suggested finding #2    be amended   to read      framework of

                 municipal, county, and State Planning..." This       was agreed to.by.all present.

                 INDUSTRY AND INDUSTRIAL LAND

                      Mr. Biondi explained that we are    going to be discussing the intensity

                 of economic development in the State    and the,rate  of growth that we think

                 the State of Delaware should have. However, these policies should also be
                 considered in the context of the Land Use Committee Report. We know certain
                 new industries that will be coming into the.State and     industrial areas will

                 have to be developed somewhere in the State;this section of the report

                 addresses where those facilities   ought to be located and the nature of the

                 facilities.

                      In Policy #1, Mr.'Biondi asked if there is a limited number of existing

                 unused industrial sites? Buildings? To what extent       are there properties

                 that can be renovated?

                      Mr. Krapf stated that he owns 1,250,000 square     feet in the Bancroft

                 Plant and he does  not feel that this   should be kept  as industrial land.. In.

                 his opinion, this  land should eventually be phased out    and put to a different

                 use. Mr. Krapf further stated that finding #4, which      states "...where energy,

                 water and sewers are available" to him means that.you     would never build a  new

                 place. The sites that   are available are-tooold,and     have too.many problems.-

                      Mr. Biondi asked  if these might be sites that the    State could purchase,
<pb n="416" />

                 Ref: 1007/1404                       -6-

                 clear, and-put upuseable buildings.       He.felt the Committee was saying

                 that even if.there are no utilities available to use.the industrial sites,

                 we ought to force them to use the unused industrial sites and renovate

                 them before going out   to areas where util-ities are not available.at the

                 present time.

                      Mr. Daniello said   that  he assumes #1  and #2  mean consistent with

                 'land use plans.

                      Mr. Larson said'there   are substantial. sites zoned,with public.se.rvices,.

                 and good transportation facilities.   that can- be marketed today. This policy

                 is just intended to make sure these sites are-not overlooked, when looking
                 for' hew sites.

                      Mr. Krapf  pointed out that the person-who owns an operation should have

                 a say in where  it is to be located.

                      Mayor Carroll felt that the question of whether an industry decides to

                 move,into'a particular county is the    tract  record of that County.' He felt

                 that in 5 years time Dover will have    the same problems Wilmington has. Dover's

                 concern is that they be given an opportunity to be competitive but to do it
                 on a basis where the City. is not being bled,to death by the County       and State

                 governments, which put Wilmington in the.position they are in today.

                      Mr. Larson felt that some of the problem with finding #4       is the  word

                 "available", which to him means economically feasible for extension.

                      It was moved by Mr. Krapf and seconded by Mr. Thorn that        Policy #1 be

                 accepted as written. All present voted in favor.

                      In Policy #2 Mr. Biondi asked what the Committee had       in mind with

                 respect to this policy. Mr. Larson said that.this policy        was intended. to

                 attract the types of workers,that need jobs- be that a blue collar worker or
<pb n="417" />

                 Ref: 1007/1404                      -7-

                 a computer operator.
                      Mr. Schranck felt that the definition of "needs"     should-be clarified.

                 Mr. Biondi said this  meant need for a job not a product.
                      Dr. Lathlam said there is some danger of adopting a    policy that.attracts
                 industries where you   have the highest.rate of unemployment. You will be in

                 a self-sustaining, self-defeating   circle. He suggested that the-Commissiton

                 needs to balance the strategy of attracting low skill industry with upgrading

                 the skills of the individuals to.'suit the needs   of  incoming industries.

                      Mr. Walton noted that,.in the Committee,    he  had voted against this policy

                 because he would.rather see State money and policy being spent in expanding

                 our own industries. This gets into an economic area which.was not in the

                 purview ofthe Committee. He said that rather than going out and recruiting

                 new industries, Delaware development dollars should be spent with those

                 firms that are already here and can expand their business. There is not a

                 business in this State that has reached its maximum.

                      Mr. Biondi then suggested revising.this statement to read:.,"Delaware

                 should encourage the introduction of new.industries and development of exist-.

                 ing industries which optimize...

                      Mrs. Slights, who also recorded a no vote in the Commi.ttee, explained

                 that she felt.that Delaware   had certain-native attractions that would bring

                 without encoura.aement, specific types of industries that would fulfill the

                 State's needs. She said we don't want to encourage in-migration of.the kind

                 that we already have an over abundance of.

                      Mr. Daniello said that the need for more diversity of industry in      this

                 State is vital. The existing industrial     infra-structure does not take   care

                 of-all the skills and needs of   people in  Delaware at the present time.
<pb n="418" />

                Ref: 1007/1404                   -8-

                He further  stated that Delaware is, for the most part, primarily depend-

                ent on two  (2) industries: chemical and auto. If we could have some

                diversity,  we would all be better off for it;@ especially the taxpayers.

                     Mayor  Carroll felt that the Commission should. define what is needed in

                specific areas.a nd what type  of industries you want in those areas.

                     Mr. Biondi clarified that the land use aspect of this policyrelates

                to industries using land. Mr. Walton feels that the existing land ought

                to be used. This   makes for  more. efficient use of land. The expansion of

                these facilities will ultimately result.in less     land.being taken out   of

                other uses.

                     Mr. Larson said there was a fundamental difference between Mr. Walton

                and the majority of the Committee on this question, which     is the reason

                Mr. Walton voted no. Mr. Larson said     he felt the Committee is talking about
                new industry. He further stated that     the phrase "optimizing the State's

                resources".is the key to this policy.

                     Mr.  Russellmoved that Policy #2    be accepted.as written. This was

                seconded  by Mr. Oldach.   Mr. Walton and, Mayor Carroll recorded the only   no votes.

                     In  Policy #3, Mrs.  Slights said that she was in favor in principle    of

                this-policy, however, she was not pleased with     the wording-She   felt the word-

                ing shouldbee "Delaware should direct industrial    development to areas that are

                located so that services can be provided,economically.','

                     Mr. Krapf said industrial   development will not go to a location that

                won't be  economical. Mayor Carroll said there is a question      as to what the

                interpretation is of "economica.l."

                     Mr.  Russell stated the problem is that, because an.industry locates     and

                puts a.certai'n amount of  money into the.local  economy and the local and State
<pb n="419" />

                Ref: 1007/1404

                governments put.even more out to support those people for welfare, etc.,

                that is not economically efficient for that local government.

                     Mayor Carroll agreed that this is part of the problem, however, he

                stated that you can make water and sewers available by agencies other than

                the local unit of government. Then the-demands placed on that commun.ity,

                as a result of the human needs, is where the burden is placed on the local

                unit of government. The local government gets nothing in lieu of taxes,

                or services, yet they have to provide the services. He defines local units

                of government as a city or county that supplies local services.

                     t1r. Russell said that we assume government is there specifically for

                costs and not for costs and benefits. In other words, they are going to

                operate in the red because that is what they are all about.

                     Mr. Biondi felt that Mayor Carroll has a problem in mind that none of

                the policies addressed in Policy #3, he thought they were saying that we

                ought to encourage the development of industrial areas that are located so

                that services can be provided economically as contrasted with locating them

                where the services will cost more to provide..

                     Mr. Krapf moved that this policy be accepted as written. This   motion

                was seconded and agreed to by all present with Mavor Carroll not voting

                     Mr. Larson expla ined that Policy #4 looks at the question.of any future

                ports, marine terminals, or pipelines that might be built through the State..

                The Committee felt that the State and/or local, governme nts should assume

                regulatory and/or operational control- which in some cases might even be

                ownership.

                     Mr. Biondi said he did not know there was anything that was not regulated
<pb n="420" />

               Ref: 1007/1404                    _10-

               by at least four  (4) different levels- county, State, Federal and City

               levels.

                    Mr. Bryson  said that, at the present  time, the Department of Natural
               Resources and Environmental.Control does   not.have the authority to tell

               these facilities  where to locate. Withrespect to the kind of uses stited

               in this policy,  the State, in addition to  the County, should have a say

               as to where they'are located, in addition   to the problem of what regulations

               would be imposed on them. He asked what was the concept of operational con-

               trol?

                    Mr. Larsonsaid that   would be  in the event there was  no regulatory

               control.. For  example, it is possible the State might want   to build, own'

               and operate a  facility such as mentioned in this policy. This applies to

               future sites.

                    Mr. O'Donnell  said he always assumed that the State did have regulatory

               powers in such things as  pipelines and bulk, transfer facilities such as. the

               Coastal Zone Act.   He clarified that when "Delaware" is mentioned in this

               report, this means  all jurisdictional levels, not just  the State. He   also

               clarified that zoning control is not   enough because it may or may not  be

               based upon a land use plan, depending   on where you are.

                    Mr. Walton noted that.where utility, electric lines are located     is not

               regulated by the State, other than by the Public Service Commission.

                    Mr. Biondi a-sked if it damages the Committee's pol icy to remove  the

               phrase "operational control." -He said there are levels of expertise    involved

               that he does not see existing  anywhere in the routine of State,,County, or

               City employees.
<pb n="421" />

                    Ref:  1007/1404

                          Mr  Daniello   saidhe could envision a situation     where there exis   ts

                    a need for a particular    facility and there is   no way  that it can bedone

                    privately and yet it would be in the interest      of the  State and its

                    residents to have operational control. Mr. Biondi said.that when Mr.

                    Daniello found that case the Commission would agree to that policy.,.

                          Mr. Krapf moved that Policy #4.be amended, striking the words

                    11or operational." This was approved with-Mr. Daniello, Mr. Walton and

                    Mr. Bryson voting no.

                          It was moved and  seconded that the Policy #4 be adopted      as amended.

                    This was agreed to by   all present.

                          Mr. Biondi noted  that Policy #5 addresses some of Mayor      Carroll's

                    concerns. Mayor Carroll has been saying that, at some point         in time, in

                    addition to talking about optimum lot size, utility availability, accessi-

                            etc, you have to look at theoverall impact on the surrounding

                    .community even if that community crosses a governmental line, such as a city.

                          Mr. Larson suggested, after the word "accessibility,", adding the

                    phrase "and the overall impac   t on local c ommun ities.."

                          Mr. Krapf asked how you make a standard lotsize. Mr.-Larson said

                    what the committee was trying to getaway from was the one acre industrial,

                    park. They were suggesting an optimum.industrial park size. Mr. Krapf

                    said he, personally, agreed with this idea, however, he asked why should the

                    little man who wants a one acre lot be eliminated; why should he beforced

                    outlof business? Mr..Larson answered because he is demanding services and

                    facilities far greater than what M returns in benefits to the community.

                    He can go into an industrial    park at less cost to himself and    at greate  r.
<pb n="422" />

                 Ref:.1007/1404                      _12-

                 benefit to the community that is planned and well laid     out with optimum

                 lot sizes than if he buys   a piece of land, by himself,   out in the middle
                 of nowhere. It will be up    to the land planners to determine what is.

                 optimum.

                      Mrs. Slights suggested that the   word,"lot" be stricke  n from thi,s

                 policy.

                      Mr. Krapf expressed-concern   about the  unfairness of this policy to

                 the "little man." Mr. Larson clarified that.the-Committee is not saying

                 that the@- "TittTe. man," who- want's to open a- garage, or- set up a little

                 industrial operation., cannot do it. If he can@fi,nd a site that i-s al-
                 ready zoned industry,.,he can.do it. This policy refers to areas that are

                 requested to-be-zone for industry: the Commission    would discourage this.

                      Mr. Oldach feel-s that the Commi-ssion-is not going to be able,to

                 establish a set of standards an&amp;criteria    that will apply to-optimum size,

                 utility availa bility and accessibil.ity. Every case will be different.

                      Mr. Keifer said it is difficult to establish:standards for different

                 kinds of industrial enterprises.    He feels, however, that you coul"d.set

                 some criteria out for new indUstrfal clauses. He said he was in.favor of

                 this policy.

                      Mr. Daniello,,said that-until-the time,comes that all counties land

                 use plans are existing  zoning, we-have situations especially in New Castle

                 County, where the.ind -ustrial land.conforms to the comprehensive plan of

                 the County@as proposed  for industry- but it is not done and the owner will

                 not-bring the land in  for rezon,ing until he has-a buyer. He explainedthat

                 his Department releases a publication about available industrial sites in
<pb n="423" />

                 Ref: 1007/1404                -13-

                 th e State.  He asked whatwould his Department do from a promotional

                 aspect- the only lands they could show to any prospect would be, lands

                 already zoned. He said he did not.believe that is what the Committee

                 intended to do, although the policy says, in his viewpoint, that the

                 only lands that would be available to show to prospects  would be existing

                 zoned properties.

                      Mr. Larson said that Mr. Daniello raised a problem  that was not

                 dis cussed by the Committee. He thougft.there would b6 a closer relation-

                 ship between promotion and zoning worked,out under such a program. He

                 said Mr. Daniello was right and that this policy does tend to preclude

                 his promoting.a site that did.not go through the process of meeting the

                 criteria.

                      Mr. Biondi suggested this policy be amended to read as follows:

                  Delaware and its local governmentsshould establish standards and criteria

                 for industrial location, including optimum size, utility availability,

                 accessibility, and the overall impact  on-local communities, such standards

                 to be met prior to rezoning for industry. The, State shall not promote the

                 inclusion of a site, for industrial purposes, when the utilization for that

                 purpose is contrary to the land use planning in the area."

                      It was moved and seconded that the amendment proposed by Mr.. Biondi

                 be accepted. This was agreed to by al.1 present.

                      It was moved and seconded that the policy, as amended, be adopted by

                 the Commission.

                      Mr. Krapf stated that  he agreed to the amendment, however, he objected

                 to the policy as a whole.   As far as the reference to Delaware and its
<pb n="424" />

                   Ref: 1007/1404                     -14-

                   local governments should establish standards, he does not feel that

                   this is the proper vehicle. He feels that this policy is asking for

                   something to happen before the fact.

                        Mr.-D aniello said there was nothing in the    policy.that  is not,

                   theoretically, being done now,. Mr. Krapf asked     why isthis   policy even

                   necessary.   Mr. Biondi said it is taking -the argument one step back from

                   the zoning process.

                        Mr. Larson'said that most land use    plans and  most  zoning ordinances

                   in Delaware   do not include standards in.criteria   for industrial location,

                   including size,  util'ity availability and accessibility and the impact. He

                   further stated  that in the policy,   we could be suggesting adding a level

                   of standard   to the land development controls,    as they exist today, either

                   through zoning  or sub-division.control. The     intent is not to impose

                   another level of controls. We are trying to      make facilities in Delaware

                   attractive so that people will come.

                        Mr. Daniello  stated that if somekind of     standardization of all the

                   local rules and regulations, results from this, it would be a "blessing

                   for all concerned.

                        Mayor Carroll. said he hoped this policy is    saying that,.if    industry

                   were to locate in a  certain county, that a checklist should be made as to

                   what demands are going to be placed on whatever     unit of g6vernment is.going

                   to be responsible,  not onl,y from the standpoint   of utilities. This policy

                   also says that this  should be accomplished prior to the time they put in a

                   rezoning request to  the County zoning office.

                        The motion on accepting policy #5 as amended, was agreed to with

                   Mr. Oldach, Mr. Krapf, Mr. Schranck.and Mr. Ryan     voting no.
<pb n="425" />

                  Ref: 1007/1404                .-15-

                       This completed the revisions of the  Land Use Report (except for

                  those issues to be addressed-in conjunction with the Coastal Zone  issue).

                       Mr. Biondi explained that the Commission has not yet received   the.

                  revised Economic Development Committee report. Two (2) of the policies

                  suggested by that Committee have not beenresolved:@ the   tax policy and

                  the Coastal Zone policy.

                       It was agreed that thepolicies listed on page 14,151 and 16 of the
                  Economic Development Committee Report could be considered at this meeting.

                       The Economic Development Committee will be meeting on Thursday, June 19

                  to discuss and write their final report, which will be submitted to the

                  Commission priorto the next meeting, which has been scheduled for July 2,

                  1975, at 4:00 P.M. in the Cabinet Room.of the Townsend Building in Dover,

                  Delaware. Mr. Biondi stated that he hoped to finish discussing pages 14,15,

                  and 16 of the Economic Development Committee Report and discuss the Cost

                  of Public Services Committee Report at this meeting, so that, at the next

                  meeting, the major issues concerning the Economic Development Committee

                  can be discussed along with the issue of how much growth we want to.stimulate

                  in the State, apart from the specific issues the Economic Development Committee

                  @is looking at.

                  ECO140MIC DEVELOPMENT COMMITTEE REPORT

                       Mr. Biondi stated that in.Policy #9, the thrust seems to be an indica-

                  tion that Delaware banks are either exporting capital or they are not loaninq

                  a sufficient amount of their assets in commercial or industrial.loans. Mr.

                  Biondi asked if the banks have'anybody to loan it to or.have the overall

                  economic conditions in the State and the conditions in the State with respect
<pb n="426" />

                 Ref: 1007/1404                    -16-

                 to development, deprived them of markets for loaning, if indeed there

                 is a fourth (4) for commercial-industrial loans?

                      Mr. Bradford.felt that some of the words in this policy are  misused.

                 Development of venture capita 1 is not a banking function. As far as the

                 background figures in this, policy, Mr. Bradford said,that Delaware has

                 'historically raised more in deposits than the State has been able to use,

                 in loans.

                      Mr. Thompson.(Chairman of Economic Development Committee) explained

                 that the section concerning "venture capital" goes back to the idea of

                 developing bonds to make sure th ere was adequate capital available for

                 new industry coming into the State. He said the se ction on  "venture

                 capital" could be deleted. It was agreed to amend the first sentence in

                 Policy #9 to read:   Delaware's.banks should be encouraqed.to give greater

                 lending support to business and industry."

                      Mr. Krapf asked if anyone knew if the percentages in the second (2nd)

                 sentence are correct. Mr. Thompson said these  figures came from the

                 University staff working on this project. The  thrust of these figures is

                 that there should not be any reason for lack of capital for industries

                 coming in.

                      Mr. Krapf said he just wanted to be sure the figures used are complete-

                 ly accurate. Mr. Thompson agreed to double check the figures.

                      Mr. Larson asked Mr. Thompson if there was any information that would

                 indicate what percentage of the commercial, industrial loans go to Delaware

                 businesses and.industry. Presumably Delaware banks will loan outside of

                 Delaware and Delaware corporations will borrow outside of Delaware from other
<pb n="427" />

                   Ref: 1007/1404                    -17-

                   institutions.   He felt that the figures  aren't very meaningful.

                        Mr. Walton  moved that Policy #9 be  accepted as amended, striking

                    ... and to cooperate in developing venture capital sources for starting

                   new companies."  andverifying the figures in the second (2,nd) sentence.

                   The only no votes were Mr. Krapf, Mr. Biondi, and Mr. Daniello.

                        Mr. Schranck said.that policy #10 is a noble goal   and he hopes  it
                   can be achieved, however, he stated that since he had   been on board,  he and

                   Secretary Daniello have been trying to figure out   how to accomplish this

                   goal. He said his Department   is funded and mandated  by the Federal govern.-

                   ment to collect certain data.   Some of the data listed in this policy is

                   readily available and some is  not Available at all, for example: under-

                   employment-his office has no way of checking-this figure out; no data is

                   collected on this. He said that basically,he doesn't disagree.with the

                   intent of this policy, he just doesn't know how it wi.11 be accomplished.

                        Mr. Thompson stated that h e felt that one of the problems facing the,

                   Commission in.making policies is that they have no real feel for the

                   standard of unemployment, for example. He did not think it would be to    o

                   difficult for a sampling of these figures to.be drawn up, possibly with

                   assistance from the University  staff. Mr. Schranck agreed that the informa-
                   tion is available, a system has  to be put togetheronbow to extract it.

                        Mr. Walton moved that this  policy.be adopted as written. This was

                   seconded and approved by all present...

                        In Policy #11, Mr. Biondi asked if there was any conflict between    the

                   first sentence of this Policy and the Policyagainst.the over-extension of

                   utilities that the Commission discussed in considering the Land Use Committee.

                   Report. Mr. Larson  said he saw no conflict.
<pb n="428" />

                  Ref: 100711404                  _18-

                       Mr. Biondi questioned whether the second sentence properly addresses

                  the question-of what we would like the 'State government to do about the

                  possibility of a natural gas shortage in the State.
                       Mr. Thompson said he wasn't convinced that Delaware has problems in

                  the energy area that are as critical as in the surrounding states. The problems

                  are regional.

                       Mr. Biondi asked if.the State government should   support the.de-regulation

                  of natural gas prices in@inter-State Commerce or should we support the develop-

                  ment of an atomic energy power  plant.

                       Secretary Schranck said that it has been  said that if you support the

                  de@regqlation, the price will go sky high and  then fall back. He said he

                  did not know if that was true or not because  it will become an over abundance

                  of supply   so maybe we should support it. On the second half of that

                  question, he said we should support the development of a nuclear power plant.

                       Mr. Bryson agreed that the State should work with the Federal govern-

                  ment on policies toencourage nuclear power plants to a point. He said,

                  however, that it can be overdone and it is grossly over-rated as to how

                  cheap it might be. As far as cheap fuel-is concerned, the controlling

                  interest is too closely regulated by too.fewpeople.

                       Mr. Krapf said that he thought this issue ought to   be looked into and

                  that we certainly should support tnyinq to find natural   gas and oil on

                  Delaware's shores or land.

                       Mr. Thorn.,stated that, in connection with nuclear power, he feels

                  that there have been many arguments by "exPerts" regarding the safety   and

                  inexpensiveness or lack of safety and expensiveness. He said the whole issue

                  is so confused, it is nearly impossible for any local governments to really

                  know. He felt that, instead of promoting nuclear power at this point in
<pb n="429" />

                    Ref   1007/1404                     -19-

                    time, we should   go into something we are a little      more certain of,

                    for instance coal with coal desulfurization.

                          Mr. Biondi  said that the issues raised on off-shore coastal drill-

                    ing,  including oil and natural gas will be discussed at       the next meeting.

                    Mr. Larson suggested inserting the phrase "short term"        so as to read

                    ..."must develop a plan for meeting      sh ort term and long  term energy,needs

                    of business and industry."

                          Mr. Brvson noted that    his department has developed one new source-

                    burning garbage   and sewer sludge.    It will be located in New     Castle County.

                    It is about a 19   million dollar plant that will turn garbage       and sewer

                    sludge into useable products, including fuel. This is a step in the right

                    direction.

                          Mr. Biondi  suggested that the last sentence in paragraph 1 of Policy

                    #11 beamended to read: "The State government, in cooperation         wit.h Dela-

                    ware's utility c  ompanies, must develop a plan for meeting short term and

                    long term energy needs of business and industry, including the development

                    of new energy sources and the conservation of existing sources.", It was

                    moved by Mr. Thorn and seconded by Mr. Daniello that this policy         be adopted

                    as amended. It was agreed to by.all present.,

                          In Policy #12,,Mr. Thompson explained that there       is a qeneral concern that.

                    vie have not done enouqh to brinq the industrial needs       and the  educational

                    services toqether so that the kids and adults are, indeed, being trained

                    for jobs that really exist, rather,than for the jobs       teachers are equinped

                    to teach.

                          It was moved by   Mr. Daniello and seconded by Mr.     Thorn that this policy

                    be adopted as written. This was agreed to by        all present.
<pb n="430" />

                  Ref:1007/1404                   _20-

                       It was moved by Mr. Larson and seconded by Mr..  Walton that Policy

                  #13 be adopted as written. 'This was agreed to by all present.

                       In Policy 7#14, Mr. Thompson explained, some of the material was

                  drafted by the staff while he was in Brazil, and presented to the

                  Committee. However, these items were not discussed by the Committee one

                  by one. Mr. Thompson further stated that he felt 14-C was debatable

                  because Delaware's  median tax level is below many, other states. We are

                  35th out of the 50 states. If   you look at the total taxes.collected in

                  Delaware on per capita income,  Delaware is not  heavily taxed.

                       Mr. Biondi then suggested  changing the wording on 14-C to read:

                  "Keep the per capita

                       Mr. Thorn asked assuming  that we want services that are comparable

                  to larger States, is it not possible to the extent we have to have an

                  administrative force to accomplish.the.se services,. that our costs are

                  bound to behigher than other states? For example,     every state has only

                  one Governor. However, the Governor of New York would    be cheaper per

                  person, than the Governor of Delaware.

                       Dr. Latham said that almost all government   services do not have

                  significant economics of.scale, in  fact there are significant dis-economics

                  scale in most government services  so that the larger the size of the govern-

                  ment providinq the services, the moreAnefficient it is likely to be.

                       Mr. Krapf stated that Policy #14 consisted of.."a lot of nice words."

                  Mr. Russell moved that this policy be stricken. Mr. Oldach seconded the

                  motion and all present voted in favor.

                       @Policies #15 and 0,16 will be discussed at the next Commission meeting.
<pb n="431" />

                  Ref   1007/1404                      -21-

                  COSTOF PUBLIC   SERVICES  COMMITTEE

                        Mr. Bradford (Vice-Chairman on  the Cost  of Public Services  Committee)

                  explained that the purpose of this   report is  different from the  other two

                  reports in that it makes no recommendations    for any alterations  to the

                  cost of services of the revenues to support    that, simply   because of a

                  lack of guidance from.the other reports to    operate on. He said   in  this,

                  report, they attempted to gather some facts,and make a presentation on

                  the costs of the governments of Delaware to.give a data base,,which could

                  be drawn upon, when the time came, to see what.would be required in the

                  area of future costs.

                        He felt it was necessary for the Commission to. try to get an under-

                  standing of what the Cost of PublicServices Committee attempted to do.

                        Mr. Biondi noted that subsequent to the Buena Vista Commission meeting,

                  there  was some discussion about some of the data in the report. Dr. Latham

                  said there was some question about clarifying the material that was pre-

                  sented, especially with respect to figures regarding revenues for Various

                  State and local governments. The main-question raised was:." Why didn't

                  the revenue figures in the Cost of Public Services Committee correspond to

                  numbers with which individuals   familiar with  State's budget  figures were

                  familiar with. He stated that    if you take the figures that   most people

                  .are familiar with and subtract out refunds   and add in special funds, then

                  you end up  with the numbers in  the report.   The report was  intended. to

                  illustrate what total revenues   for the State:.had.been.and  how.they had been

                  expended for the past   5) years. That is the  reason a distinction was not
<pb n="432" />

                  Ref: 1004/1404                      -221-

                  maintained between general and special funds and it was also decided

                  to net-out any refunds, since those were not available for expenditure

                  either. He said this   information is in the summary.report of May 23.

                       Mr. Biondi asked Dr. Latham if he considered the figures used in

                  the report or the figures that some peopleare more familiar with, to      be

                  the valid figures to use for the ki-nd of tool the Committee's attempting

                  to construct here? Dr. Latham said that    the numbers in the report are
                  more val'id than the normal State budget figures.

                       Mr. Russell asked if that means that   the revenue of the State include

                  the pass-through dollars dropped to local   governments? Does the State

                  then carrv those.revenues and not the local government. Dr. Latham

                  answered: "This publication- yes. This report also includes Federal and
                  inter-governmental transfers?

                       Mr. Biondi noted that Mr. Keifer, Mr. Bradford and Dr. Latham all

                  agree that the approach used in accounting for these revenues in the
                  report, for the purposes of what the Committee was aiming to do,     is a

                  more valid basis than using the ordinary State budget figures.

                       Mr. Biondi asked Dr. Latham, if, collecting the kind of data that @,as

                  been collected, we can project'what the cost of growth, for example, will

                  be at various levels?

                       Dr. Latham said that in the summary report dated May 23 it states,

                  that there is a strong feeling that revenues would tend to meet rising

                  costs of services if  no new expenditures were  contemplated. The Cost of

                  Public Service Committee decided that unless   the Commission is willinq to

                  specifv a set of conditions, or agree to   a,set of conditions that the

                  Cost of Public Service Committee has specified, there is not a good way
<pb n="433" />

                   Ref: 1007/1404                       -23-

                   of putting some numbers down for projecting costs    and revenues.

                        Mr. Biondi asked, rather than talking in terms of absolute dollars,

                   could it be done in terms of percentage increases in revenue costs.

                   Dr. Latham said it can be done.    Some parts of the expendi:tu  res,

                   .,projected if we have percentage growth rates. We further stated that

                   one of the main points in this report is that growth has been    purchased

                   largely with external dollars, that is-very much of the growth    has been

                   financed by Federal funds. If,An the future, the same amount      of Federal

                   funds are not available and the State has opted for a certain level of
                   growth, the people in the State of    Delawa rewill have to. pay for it a  nd
                   the money may not be available.

                        Mr. Biondi said he is trying to see if there is a way    that the

                   Commission can say, from an economic     and social.point of,view, a given

                   rate is  desirable.,         The question is how much will it cost us and

                   how wi 11 we pay for it all along?

                        Mr. Krapf asked  where is Delaware's rate as far as the dollars ex-.

                   pended for State and  local governmentsover the capital income of the people.

                   Mr. Thompson answered  that in the figures published by the U. S. Department

                   of Commerce, Delaware  ranks 35th in the cost of gove  rnment as a percent of

                 .per capita income.

                        Dr. Latham  said that those figures are difficult   to interpret.be ca.use

                   some gtates provide more services and.turn.around and    charge back for them

                   again-then the money  comes in on both.the cost and expenditure sides.
<pb n="434" />

                  Ref:1007/1404                         -24-

                       Mr. Biondi said that ".he does not think there is any doubt that

                  the cost of government expenditures per capita, taking State and local

                  tax burdens together, the State ranks 35th. He also thinks it is true

                  that, as far as State expenditures per capita, we are one of the highest

                  in the country. If we are 35th out of 50 as far as State and local

                  expenditures and taxes per capita, there seems to be some room to afford

                  cost of future development in the State. However, then the question

                  arises, at what level will the cost of future development fall. The

                  Cost of Public ServicesCommittee report seems to indicate that thecost

                  of services is growing faster at the State level than i't is at the County

                  and local government levelsand the revenues are growing faster at the

                  County level than at the State level. If we are talking about the cost of

                  growth, we may have to talk about a reallocation of the cost of growth

                  between various levels of government in the State in order to afford that

                  kind of growth. He further stated that he thinks that if the cost of

                  growth can be better allocated, we can afford more growth.

                       Mr. Oldach stated that he thought the Cost of Public Servicescommit't.--e

                  would approach the problem of trying to evaluate the relevant costs of

                  services to other states. Dr. Latham,said this is possible but has not

                  been done.

                       Mr. Biondi stated that if, for example, the City of Wilminqton govern-

                  ment were abolished and combined with the County government, he did not

                  feel that a savings of more than 5% would be realized. In fact it might

                  end up costing more. However, he agreed that with the different levels of

                  government operations there is room for improvement and combination of services

                  and tax savinqS. There was general agreement that local and State qovernments

                  can be operated more efficiently than at the present time.
<pb n="435" />

                  Ref: 1007/1404                    -25-

                        f1l.r. Russell asked that if the cost of growth between the, State

                  and local governments was shifted, would the growth of revenue at the

                  local levels be sufficient to absorb the Cost of qrowth.

                        Mr. Biondi said he did not think it would be sufficient. He said

                  you would  still have to have an increase in the cost of government at

                  the State  level. The  qu estion is how much?

                        Mr. Bradford said one of the reasons that, on the disbursement

                  side of the report, the Committee attempted to get.the total cost was

                  not so much that they saw a single government for    the whole State rather

                  an attempt to get the total cost of any growth and    then go back and look

                  at where the cost and revenues would fall. Dr. Latham noted than      in

                  regards to the cost.of public services,and growth,    at the last Commission meeting

                  the idea of employing user charges extensively    in development was rejected.

                  When user charges areemployed with developme.nt,.you    don't have to worry

                  about where the,money is coming from     you would know where it is going to

                  come  from. You don't have to worry about,who will be doing the expending;

                  it is all taken place in connection with the development. He raised this

                  issue to point out a consequence of one of the actions the Commission has

                  already.taken.

                        Mr. Oldach noted that the Commission is at animpasse because the.Cost

                  of Public Services Commi.ttee needs to know what kind of qrowth before they

                  can calculate the economics and the Commission can't decide what kind of

                  qrowth till we know what the price is. He suggested the Commission try

                  out a couple of test cases where you assume a certain growth of a certain

                  type of population and calculate the cost.

                        Dr. Latham said that would be relatively simple. The problems would

                  be getting the Co mm, ission to agree on what the rate of inflation on labor
                 will be   and other costs for the next 10 years-
<pb n="436" />

                 Ref: 100 7/1404                 -26-

                      Mr. Kraof said that, first of  al.1, the Commission should decide

                 if they want any rate of growth at  all. If so, then.they should go

                 from there and decide at what rate  they want growth.

                      Mr. Russell said that he feels it will be detrimental to the

                 direction of the Commission for the Commissicnto come out with a state-

                 ment that we are for or against growth.

                      Dr. Latham.said he felt the Commission is saying that growth is

                 desirable provided that  it is the kind.of growth that does not cost

                 Delaware in other values, provided that we still maintain a quality  of

                 life and a standard of  living that is desirable for the majority of  the

                 people in the State. The question is   at what level of growth do we
                 start losing something in our quality  of liffe.

                      Mr. Thompson asked how much growth has cost the State of  Delaware

                 in the last 20 years. Dr. Latham said that would bb a major undertaking

                 of going back through the State budget documents and determining where

                 the expenditures came in.

                      Mr. Keifer stated that it would be nearly impossible to figure out

                 where the historic capital went    did it go to service growth or improve-

                 ments and repairs. He further stated that, in terms of the future, the

                 biggest problem in handling growth, and the key factor in determining

                 additional investment, would be where the growth goes, more than how much.

                 The.gist of the previous conversations was that the Cost of Public Services

                 Committee@ should not use any of the Commission's new policies in calculating

                 their figures. The Cost of Public ServicesCommittee should look at things

                 as they have been done in the past, and then the Commission can put what

                 the Cost of Public ServicEsCommittee has done into the.Commi.ssioils policies.
<pb n="437" />

                                                  -27-
                Ref: 1007/1404

                     Mr. Biondi adjourned the meeting at 8:25 P.M. The next meeting
                  of the Delaware Tomorrow commission will be held on Wednesday, July 2,

                at 4:00 P.M. in  the Cabinet Room of the  Townsend BuildIing. 'The Cost

                of Public Service  Committee report will be further discussed at that

                 time.

                                                  Respectfully  Submitted.,

                                                   Dee Burkley
                                                   Recording 'Secretary

                  DB/hmcK
<pb n="438" />

                                                  ..........

                                           STATE  OF DELAWARE

      DAVID R. KEIFER                                                                PHONE;. (302) 67
         DIRECTOR                            PLANNING OFFICE                                     B-4271
                                                  DOVER

               Ref.:  1007-1404

                                =ING OF THE DELAWARE TOMRRDW CMaSSION

                                                  July 2, 1975

                    A meeting.of the Delaware Tomorrow           Commission was held in

             the Cabinet Room of the Townsend Building in Do            ver, on July 2, 1975..

                    In attendance at the meeting were the following:

                    Frank Biondi, Chairman of the Commission
                    Dave Keifer, State Planner
                    Sherman Webb, Office of the Governor
                    Ernie Thorn, Common Cause
                    Cliff Hall, Secretary of the Dept. of Highways              and Transportation
                    Ross Anderson, President of the Delaware Chamber of Commerce
                    Robert Berndt, Senator, Delaware General Assembly
                    Joann Slights, Watch Kr Waterways
                    Pete Larson, Greater Wilmington Development Council
                    William Latham III, University of.Delaware
                    Art Krieger, Attorney
                    Leon Weiner, Leon Wiener and Associates, Inc.
                    @Marcie Bierlein, League of Women Voters, Delaware
                    David Singleton, Office of the Mayor, City of Wilmington
                    .John Daniello, Secretary of the Dept. of Community Affairs
                        and Economic Development
                    Dorothy Greer, Delawareans for Orderly Development
                    Joseph Conaway., Sussex County Administrator
                    Thomas Schranck, Secretary of the Department of              Labor
                    Crawford.Carroll, Mayor of the City-of Dover
                    Jay Cooperson, Sierra Club, Delaware Group
                    Henry Folsom, President New Castle County Council
                    Carl Russell, New Castle County Office of the Executive
                    Peg McClane, League of Women Voters
                    Rita Smith, League of Women Voters
                    Rod Ward, Attorney
                    John Bryson, Secretary of the Dept. of           Natural Resources and
                        and Environmental Control
                    Bill Thompson, Dept of Natural,Resources &amp; Environ. Control
                    Dan Kuennen, University of Delaware
                    John Walton, Delaware Farm Bureau
                    Bernard Dworsky, New Castle County,20.8 Program
                    Ed O'Donnell, New Castle County Department of Planning
                    William Markell, University of Delaware
                    Frederic Krapf, Frederic Krapf and Son
                    Spencer Thompson, ICI, America
<pb n="439" />

                                              2

                  Chairman Biondic alled the meeting to order  at approximately

           4:30 p.m.

                  Chairman noted the mention in the minutes  of the last meeting

           Df the Commission of  a memo issued by Dan Kuennen  on the.definition

           of the term "open space". This memo was distributed to     each member

           present (A copy of this memo is attached to this   set of  minutes).

                  The other unfinished matterwas the Report   of the  Economic

           Development Committee of June 26, 1975; the Report of the..

           Land Use and Community  Development Committee in terms  of its

           recommendations for the adoption,ofminimum standards    for state-

           wide land development and the Reportlo,f the Land Use and Commun-

           ity Development Committee insofar as it relates to the Coastal

           Zone.  This issue will have to be   taken'in tandem with@the Report

           of the Economic  Development Committee, on the same subject.

                  The Report of the,Land Use Committee was first considered.

           On page 5, policy #4, "Delaware should adopt uniform minimum

           statewide land development standards.". Mr. Biondi read.excerpts

           from the May 15 memorandum he received from the Land Use     Committee

           to clarify the Committee's recommendation on the uniform minimum

           statewide land.development  standardsland the proposed American Law

           In'stitute Model L.and,.Development-Code,(ALIMLDC). This memo also

           comments on the Delaware.Society of Professional Engineers' report

           and their recommendations concerning the Coastal Zone Act.

                  Mr. Biondi asked Mr.. Larson what would the Commission be

           endorsing in endorsing,the recommendations on pages 5 and 8 of.

           the April 1 Report, and.on pages,l and,2 of the May 15 addenda

           with respect to statewide land development standard and    statewide

           land.use management plan.
<pb n="440" />

                'Mr. Larson replied that the addenda should be considered

           because what is contained therein supersedes what was originally

           recommended in the April 1 report. This addenda report recommends

           the adoption of uniform statewide land development standards and/

           or criteria, but they ought to follow the development of a statewide

           land use management plan. The Committee has often expressed that

           this should be carried out as a cooperative planning effort of the.

           State Planning Office and the various countiesland municipalities..

           It would be difficult to adopt minimum standards without having

           .some notion as to how the kinds of'land uses will be regulated

           in the State.

                As far a-s item D., "Jurisdictional Arrangement s", on page 8

           of the Report, these were written in relation (as implementation

           tools) to all the policies under.the Community Development

           Pattern Section   the first section of the Report. These could

           apply to Policy #4, as originally writt6n; Policy #l.would not

           apply to the revised recommendation for a joint planning process

           between the State and local governments.,.

                Mr. Biondi called attention to Addenda Report of May   15,

           paragraph 1, and asked what the difference is between a compre-

           hensive, statewide land.use plan and a statewide comprehensive

           land use management plan. Mr. Larson replied that the two terms

           are synonymous. A plan  is not a plan without mention,of means

           on how to implement it.. If regulations are the means for imple m-

           entation, then they have to be included. Obviously, when one is

           dealing with questions of land use regulations or controls, as

           part of the implementation tools, they become part of the plan.
<pb n="441" />

                                                 4

                   Mr. Biondi recapitulated:     when talking about   a  statewide

             land use plan - in   the context of.the Land   Use Committee's Report

             the Committee means   a plan that includes mechanisms (regulations)

             for imple  mentation.. What else does   it include,  asked Mr..  Biondi?

                   Mr. Larson said,that, obviously, the word "comprehensive"

             means $?all inclusive."

                   Do you mean geographically all,inclusive,'within       the  State,

             Mr. Biondi asked?

                   Inclusive geographically and insofar     as the elements of

             the planners' concerns are included (all,,elements.that bear on,the

             development of the   land uses of the State,:   transportation,

             utilities, etc.), Mr. Larson specified.

                   From a statewide point of view, how did the      Land Use Com-

             mittee view such a plan as operating, Mr.. Biondi     asked? Mr. Larson@

             said that it should be a plan that would exclude      the decisions

             of the local governments. At     some pointin time, there were

             discussions as to remove some    of the land development control

             power from the localities, but a.better solution is for the

             count ies and municipalitiesto agree with the.Stateas to what the

             m.easures should be. The implementation would be divided       by ess'en-

             tial ly the same functional categories that the State and      municip-.

             alities presently  divide their responsibilities. Most of       the ad-

             ministration   would lie therefore with the.local    governments. The

             State, on the other  hand, has   a major input  to make to the devel-,
             opment in the way it programs and.supports the capital improvements

             particularly in transportation and utilities. With that ability

             to control the.rate  and  number of physical improvements.necessary
<pb n="442" />

                                                  5

            to support development, the-State, in turn, is going to have a role to

           play in deciding to where and when development should occur. It

           has to be a joint,effort. The plan itself need not be detailed so,

           far, as getting. down to individual parcel of land a.s, the plan that

           New Castle County or Kent County or any municipality has developed.

           Mr. Larson added his personal feeling is that the plan should be

           clearer in its direction    of community development policy than

           the. present plans  developed by the counties and municipalities.

           Some of that policy framework is fairly clearlystated and already

           adopted by  the Commission in the Land Use Committee Report. As

           far as its  status is concerned (and again speakingfor himself)

           Mr.Larson said the matter was, not discussed, or, voted on in the

           Committee.   Any plan, regardless  of how general or specific.,,

           should be adopted by the governing body that participates in; in

           this case,. it would be the Legislature...

                   Mr. Biondi  said that Mr. Larson would see more of a process

           such as an  act of  the Legislature adopting a land use plan-as,

           contrasted  with a  Commission of any-kind appointed by the Governor
           and confirmed by  the Legislature.. Mr.Larson sees the Legislature

           giving some policy   guidance and if the plan is going to be enforceble

           ithas to have the    backing of the governing,   body.

                  Mr. Biondi addressed himself to the State Planner, Dave Keifer.

           The Delaware Society of Professional Engineers has recommended that

           the State Planner develop a plan and      recommendations in cooperation

           with a coastal zone management. commit-tee (of course, this was

           relative to the matter of the Coastal Zone). Forgetting about the
<pb n="443" />

                                              6

           matter of the Coastal Zone problemand the Coastal    Zone Management

           committee, if someone wereto adopt the short, concise statement

           of direction which says: "the State Planner shall develop a State
           plan and recommendations" what would you do, Mr. Biondi asked

           Mr. Keifer? What process would you follow and what produce would

           you see ultimately being developed through that   kind of a.process?

           Whatrelationship would this plan have.with the    other plans that

           already exist?

                ''Mr.'Keifer responded that partly  it would  be a map, but it

           would be more than just a map. This map   would show  the different,uses,,..

           The plan would have to determi ne what the State's.concerns are such

           as development patterns.&amp;the State's investments. It would have to

           address itself to certain direct land use questions that are.of

           statewide significance. The critical.areas of concern.would have

           to be determined - areas where land development decisions should

           not rest solely with the local governments., The total plan would.

         ,have to be an attempt to.organize the management of all various

           land development controls that we have.and that are not considered

           traditional land development controls but."are on the   books" as',

           State laws:  the Wetlands Act, the Beach Preservation Act,.the

           Coastal Zone Act, etc.   This is where this. consideration,of land

           use management v. Pomprehensive land use comes into play., It is

           more than Ju st a State zoning map.

                  Mr. Biondi said, "You said   just a State zoning map. This

           is what confuses me because I can look  at.the New Castle County

           Comprehensive Plan. Aclient comes to    me and tells me that at the

           intersection of Route.X and,Route Y   he owns some land that would
<pb n="444" />

          make an ideal location for a,shopping center       By looking at New

          Castle County Comprehensive Plan, it shows Routes X and Y for
          manufacturing-industry (MI). Let us assume that the zoning is

          compatible with the plan-(and this is not always the case),.one

          can still go into the New Castle County Planning Office and file a.

          petition for rezoning-to a commercial use. The County will       take

          another,look at it and based on, the plan or in commection with

          the plan, change the use. One still has-to'go through a zoning

          process. Through.that zoning,- the administrative bodies are

          involved and no@one knows-how it will    co me out in the end..  There

          is a play.of consideration and a play    of factors.   If there  were

          a statewid-e lavd]use-pl.an, would it have any more impact? Would

          the State enter into-play thenT Wha-t would,therrelation'ship be?

          There-will be@peop-le,with physical pieces of land that they, will

          try to put through a governmental process. One-o-f the things

          tha.t.has been flowing through these@reports (the Committees,' reports)

        'from the beginning,- including the.current report o     f.the Economic

          Development Committee    is that we have to s:treamline governmental

          procedures in Delawarefor   making these   decisions. What impact    do

          you see (or would you; recommend,) that this, plan@ has?"

                 Mr. Keifer replied,  that if given the a-,ssumption that@S-tate

          government ought.to:have  some..invo.lvement in-.the land'use business

          in t-erms-,of regulating the development of land., then we are.a-lmo-st

          locked into another type of permit.system unless regulatory.ac-

          tivities are taken away from th'e local governments. Logically, it

          cannot be dbne any-other way.

                 In regards  to. management, the State  h*a-s-other land use
<pb n="445" />

                                              8

           regulatory systems running.   It is part of a State  government

           management program that would  have to get those (systems) into

           a coordinated system. May be   by doing that, it-would tend to

           streamline the process - specifically if the local governments

           .can get involved in this. It would be a one stop permit shopping.

           A land use plan cannot be done in isolation.
                  What kind of an instrument is it when it is finished, Mr.

           Biondi asked? Right now, therelis.an open question of the extent

           to which planning is related to zoning. 'Theoretically,, zoning

           should follow the plan, but what happens is that-people reconsider

           the plan in light of specific use proposals in the zoning process.

           Would that also occur with respect to a statewide plan?

                  Mr. Keifer replied that it would have to.

                  Mr. Wiener commented that there is no question that under.

           the Constitution and the legal structure, the power of planning and
           zoning emanates from the State. The State has, fundamentally,,in

           our State, delegated that power to the,counties and. the municipal-

           ities. The question that is now being asked since the State has

           financial involvement in the municipalities which it supports,

           the State now could conceivably want to have some say  over and beyond

           what it currently has whichmeans taking away some of   the powers.

           To some extent, the answer that Dave Keifer gave, the  State is

           taking back its veto power. Since zoning.is a negative power, a

           negative function, it says what one cannot do, the question that we

           .are faced with is should the State reassume and take.back some of

           the powers that.have been delegated? It may be argued that some of

           these powers should be taken back by the State or  should be deleg-
<pb n="446" />

          ated back through the State, if there i's a need demonstrated that

          it will serve the public interest. Fundamentally, this is what

          the Commission was charged with, to look in the interests of the

          pub lic as to what would be the reasons for taking any course of

          action. Simply, that the Statelis putting up the money.and,

          therefore is supporting certain activities is not a valid reason.

          Mr. Weiner said that he rejects,the  case in point. Are there

          critical areas which would be  a justified matter of state concern
          which Tun through 2, 3, 4!or.o ther jurisdictions and which.have a

          state bearing? The answeris    yes. There are matters of concern

          (such as the Coastal Zone) that arelarger than any one of,the

                                 are in. Transportation is clearly an area
          jurisdictions-that we

          that runs far beyond any one  municipality or county in terms of

          its relationship because there has,to be an overall, regional, or

          state kind of a consideration. What.we are really talking aboutis

          the kind ofin-depth discussion which would come up with the

          answers@to the questions I have been raising., Dave (Keifer) has

          expressed some feelings about it; you (Mr. Biondi) have raised a

          series of questions about it    Ithink it merits,the kind of an,

          examination that cannot be handled here to.come up with   a policy.

          The judgment would have to be  whether one is  looking at the private

          interest or the public interest;,a question which has to   be reconciled.

          There needs to be a consideration ad to,whether or not,   and if yes,

          what kind of a State planting mechanism should be developed.
          Because of Delaware's.size.does not  mean thatit has to have,one.

          It needs to be explored and fundamental ly, it has to see how it   can
<pb n="447" />

                                              10

           help the public interest. I have heard Mr. Bryson say, Mr. Wiener.

           went on, that if there were a comprehensive policy with regard to

           certain area of land use, that his task of environmental and

           natural resource overseer would begin to fall into line against

           thaf kind of a policy and ultimately lead away.f.rom. the kind of

           specification type of control that.we have.in the coastal zone.

           Of course, the other question was whether to adopt standards.

           I would like to know whether they would be performance standards

           or specification standards. The position that this Commission

           should take is that there needs to be the adoption  and the consider-

           ation of a State land use comprehensive plan and to define what the

           critical areas are, what the transportation problems are;,to
           define what the wetlands are, etc. Then come back   and make.

           specific recomme ndations.and decide where we ought to go. This

           problem is so broad and to attempt to.do.all  of this in the time

           the Commission has, would leave me abstaining.

                  Mr. Biondi remarked that he looks at planning and zoning

           as "a bundle of sticks". All the sticks have been parcelled out.

           The State is simply getting.back some of the sticks. To what

           extent does the Committee (Land Use) see the State taking back

           part of these powers?

                 Mr. Wiener feels that the sticks havenot been parcelled    out

           and this is part of the problem. The Department of Highways and

           Transportation, for instance, has nothanded out any of its sticks,;

           it has handed out a few "bucks". The Department of Natural Resources

           and Environmental Control has a big,"stick" that has been handed to

           that department by the federal governm ent to a certain extent. What

           this Commission should talk about,is a rational reconsideration
<pb n="448" />

         of the  order of priority.. All the wisdom does not lie necessarily

         in the  local governments and all the stupidity is at the State

         level.  On the other hand, all the wisdom does not lie at   the.State

         level and not at the local level where the sensitivity to   the

         community needs is equally great. Mr.,Wiener suggested that what

         needs to be done is that the Commission should find out how it

         wants to shape this "beast" b efore it proceeds with the plan to

         make the "beast."

                Mr. Biondi  then said-to assume that there is a U.S. Route X

         running through,a  portion of the.State; the county has designated

         that area for intensive residential development between 1975,and

                                            of land comes in and files  an
         1985. A  7developer with 200 acres

         application for a DPUD which complies with the plan for   the area and

         the Department of Planning staff and the Planning Board1consider this
         a reasonably good plan. The   Department of Highways and Transport-

         ation finds that this plan will generate too much trafficin the

         area, therefore, the,condition of the Department of Highways'

         approval for this plan is going to have to stage that project in

         the area that needs improvement. The Department wants the project

         staged and the condition applies to the county's approval ofthe

         project so that no more than x units can be,devel.oped before

         intersection A is improved; no more than y unitsbefore intersection

         B is improved. This is the way things are done now.. Does the

                             s recomme
         Land Use Committee'          ndation mean transferring that  kind

         of'controbl by a planning mechanism into a State Planning Department?

         or creating a set of standards that stipulate that x units   cannot

         .be developed along a state highway unless the intersection.is of
<pb n="449" />

                                             12

          certain character? What are   we talking about, Mr. Biondi asked?

                 Mr. Larson  answered no.on the second part of the question.

          However, the State plan might well.designate RouteX, between

          point A and point  B as a critical area because it is already over-

          congested and the  prospect of early, remedial assistance may.be

          dim.  There may be other problems @(structural, geographical, etc.)

          that would influence the Department of Highways' decision to have

          that particular area on Route X deferred for development until the

          problem is resolved. This State policy, in turn, should be trans-

          lated into local policy and reflected in land use.plans and local

          zoning for that area.

                 Mr. Folsom remarked that  for instance in New Castle County,

          there is a large area called the Middletown- Odessa-Townsend (MOT)

          Planning District, where the main constraint to development is

          the sewer system. The County is about to remove that constraint

          by building a regional treatment plant. So the sewer system

          constraint will be removed and the  capacity for development will

          be shifted to the highway system.   Instead of the County getting

          this problem out of balance by unilateral decisions, the County

          has gone to the Highway Department  to give the County an idea.of
          what the highway system can handle  in the MOT area with the recognized

          improvement. The Department of Highways will   then give the County

          the needed answer. In planning, the approach   should be where the

          State should enter in (t he State is financing some of this) and
          begin talking to the county on a-practical basis, at the local

          level on what the constraint is and the limit of that constraint.

          If there were constraints in the.matter of environment or in the

          matter of coastal zone, other State agencies would enter in.. This
<pb n="450" />

                                             13

          is where State and local planning efforts  must coordinate. We

          ought to get away from plans. They are long range dreams that    are

          put away on the shelf. What theCommission ought to look at is

          how much development the State can afford and what we can support.

          It is not necessary to get another set of pictures,another set,of

          principles, that are fine but coverlthe next twenty years.and we are
          to be talking about where we are.to go practically and put a,price

          tag to it.

                 There were general exclamations of "Well said",from   the,

          members.of the Commission on Mr. Fol.som's comments@.

                Are these ideas consistent with the Land Use   Committee

          Report, Mr,. Biondi-asked Mr. Larson?

                Yes, was Mr. Larson"s reply,.although.th.ere might be a

          problem on the definition of a "plan"'. Obviously, a State plan

          cannot be as deep And detailed as a local plan. The State plan

          should concentrate on trying to project the resources available in

          those areas where the State does.maintain some level of.control,

          the way it distributes the, money it collects from,citizens.. The

          State plan should concentrate in those elements which are.critical

          areas (coastal zone, wetlands, flood,:areas,.beaches, historical,

          archaeological, etc.). The otherthing that a State    plan needs to

          do that we do not have is to get a better handle on  the potential

          financial resources available to serve development in  the future.

          We have deplorabl e means of projecting our revenues and expenditures

          and a plan is only half a plan because-it does not have  the-financing

          mechanism attached to it. We h avea six year capital improvements

          program but it has no practical projections; it only focuses on
<pb n="451" />

                                               14

           what. is going on now. It takes,six to   ten years to plan and build

           a treatment plant, as an instance, and   we need to know what the

           resources will be in the future for what we plan now. There is

           little relationship between the State capital improvements program

           and the capital  improvements programs of the counties and the    local

           governments.

                  Mr. Russell commented on  Mr. Larson's  remarks that one   total

           aspect of the comprehensive plan,at thelocal   level that has  not been

           considered at all    and this is the point of  employment and  econ-

           omic development. These aspects are not considered. Some of these

           considerations should come from the State to the local governments.

           Of course, the local governments have not considered these aspects

           either. The problem seems that a    so-called "plan" becomes a

           static instrument    which it should not be - instead of a tool to

           assist in getting from place  to place, For instance, the New

           Castle County Plan is accepted by ordinance, but it is not law and

           therefore it is considered more a static document.than a tool.

           This is the way the plan has been used. It is now being updated.

                  Mr. Wiener commented on the statements,made in regards to

           the MOT growth and development. What will make MOT grow or not

           grow is people,. The market has to be there. The State can put all

           the roads it wishes, or all the sewer lines   we want to, but this is

           not what will make an.area move.. Any plan,has.to be responsive to

           the demand and need which are generated out of the economic and

           human elements. My biggest concern, Mr,    Wiener said,  is that.it

           would be a static plan. This is the problem with the    Coastal Zone

           Act at present-It was not designed to be a dynamic,     responsive
<pb n="452" />

                                                15

          piece of legislation. The Commission can       speak about standards and

          criter ia, for growth   and development, and   express an overall policy

          desire, if the State starts taking.apart the New Castle Comprehensive
          Plan and simply superimposes    it. with colors and pictures, we are
          right back  where we started from. The Department of Highways has

          been wor king with WILMAPCO and other agencies to coordinate many

          of these things. I.propose,.Mr. Wiener said, that you Mr. Chairman

          call from this Commission the establishment of a.State.Planning

          Commission (or,group)    to sit down.and.tackle this.@problem with

                            from the counties, the.municipalities, the-State

          agencies rather than to try and take a position that there        should

          be.a-comprehensive   plan;.o,r that there should be establishment of

          uniform standards.    We should consider an overall program.       If it

         @is too specific our   purpose will, be defeated.
                  Mr. Biondi replied that he disagrees with the view that       the

          Commission  should not recommend aland use plan as such. As I         listen

          to Messrs.  Folsom and  Larson, Mr. Biondi went on, I get the feeling

          that,there, is an agreement that astatewideland use        plan is.needed,

          but this plan should   not duplicate what the counties     and the  munic-

          1palities  are  doing and should address itself to-those areas     where

          there is a critical   concern either,from.the point of view-of     environ-

          ment or some   other function. this should be the-character of the

          statewide plan rather than having the Statedecide residential

          within given   areas of the county. The,plan    -should be concerned

          with problems that'have-to be resolved on a     broader basis than just

          a particular area.    Tho- question is  how does one define that

          concept?
<pb n="453" />

                                               16

                 Mr. Biondi asked Secretary Bryson to express his feelings

          about this whole J .Lssue. Mr. Bryson answered that, first one must

          not confuse planning and zoning... Planning is a must.

                 Mr. Biondi asked Mr. Bryson how he conceives this plan?

          This plan should start with what wehave available regarding the

          water quality, the air, etc. and given the set of criteria adopted

          by the State and,the federal government. The problem areas need

          to be defined so that we know whereindustry can and cannot locate

          At the present time, the State Department of Natural Resources has

          serious problems with water supply,, in fact there might be the

          first law suit  coming now because Mr.  Bryson would not let someone

          "import" water  from one area to serve another. From an environmental

          point of view,  what needs to be done is to identify areas where

          there are natural restrictions. The    basis of any land use plan has

          ,to make these kinds of considerations to go into zoning.

                 Mr. Biondi said  that he sees no conflict between the way.,

          Mr. Bryson sees a statewide land use plan and the current county's

          jurisdiction. The County Plan, Mr.    Bryson specified,.does promote

          some growth in an area where growth   should not.be encouraged because.

          there is no water available. Presently, the law is     not set in such

          a way that we can take water   from A industry to give to B industry

          (located in a different area). We may have to consider changes

          necessary to do this. In the meantime, we have to     determine what

          our problem-is with the natural.basis and go from    there.

                 Mr. Cooperson said he wanted to.take exception to what
          Mr., Wiener said to substitute the use of performance standards for
          developing some kind of a plan. This is.a panacea to the sorts of

          problems that we now face. ,Let us.assume that ina'given area,
<pb n="454" />

                                                 17

           Mr. Bryson has done what he.has     suggested he,would do in an area

           suitable for a cert  Ain use (retail, industry, etc.) and the dev-

           elopment occurs similar to the    kind that   some developer proposes.

           Once that development takes place, there      is now-a different en-

           vironment in  that location. Those performance standards,        are they

           going to be changed or once an    area is declared acceptable      for

           some use, does.it thereafter remain always.acoeptable for that        use

           so that we.can have developmenta, b,      c, all  the,way to development

           n, And assume that   the same  natural criteria   exist prior to dev-.

           elopment a? When we'talk     about Performance standards do we go

           in the basis of a    certain performance standard which may     have been

           acceptable for the first    one, or two, or three   uses  in this particular

           area, are those the same    criteria we should use for    the 30th or

           40th development proposed    for that.area?    There has  to be  some sort

           of a plan and it should not be "static"     but  there has, to, be,some

           idea of what ultimately can be allowed      in an area.

                  Dr. Latham commented    that-the difference between Mr.     Wiener's

           comments and Mr. Coopersonts'is similar to comparing a land         use

           plan and a management plan which.specifies the-criteria that will

           be used to make  decisions about land use;

                  Mr. Singleton remarked that we have      torecognize.that    the

           counties and the municipalities have been      in the planning and    zoning

           business for quite some time*and they have      done a responsible    job.

           What the Commission recommends shouldnot be a duplication of

           something that  has already been done. The      appropriate role of   the

           State intervention   is primarily in the area that...concerns more

           than one jurisdiction or which    is@.a State problem (such    as the.
<pb n="455" />

                                               18

           water supply). We   ought to be  focusing on that.

                  Mr. Krapf said that we are creating something on top of

           something else. He thought what the Commission was trying to      do

           was to come up with a simple plan. He sees another piece of

           legislation. He thought the Commission was supposed to come up

           with a State plan to do away with   the rest of the plans and let

           the others control through zoning.

                  Mr. Folsom.exclaimed: "Oh    no, you take them all or none!"

                  Mr. Larson said that Mr. Wiener made    agood.suggestion to

           make a general statement that we need to think in    terms of bringing

           together in some kind of plan the,critical    land use community

           development issues facing the State. This     should be done as. a

           cooperative effort between State and local    governments. The

           specific form of plan (or management plan)    be left to those who

           will come After this  Coumission - or possibly with feedback to

           it if it remains in  existence. Everything the Commission members

           have been talking about, Mr. Larson said, insofar as planning at

           the State level-is currently in the State Planning Act.

                  Mr. Bryson commented that there is no question About authority.

           It is just a matter of who needs to be involved.to develop a.plan

           that e,verybody can use. The Department of Natural Resources can

           tell what should not be done in acertain area but it does not

           necessarily mean th at it will not be allowed. This works in reverse.

           If heavy industry is allowed in an area does not necessarily mean

           that it should go there. The local plans have to be considered.

                  Mr. Krapf does not agree with this concept. He feels that

           @there is no reason why the State could not have a plan (coordinating
<pb n="456" />

                                               19

          with existing plans)   and have all the plans combined into one.

                  Mr. Daniello asked  Mr   Larson in the use of the word "land

          use plan", isn't onedefinition-of     a."land use plan" a statement

          of policy? What is a comprehensive development plan?

                  Yes, Mr. Larson said, among other things. Right now the

          statement of policy, in terms of land use, is being handled by       the-,

                                                              r. Daniello asked.
          subdivisions     either count y.or municipality    M

                  Essentially yes, Mr. Larson responded.     The Land..Use Com-

          mittee has-already adopted some rather-significant land use

          policies for the State of Delaware    and  if the follow through

          mechanism works, the planning    process,  the local governments    and
       ...... 'the Stat;e government,'there will-be '§-ome fundamental changes  in'

          the plans that we have now.

                  There will be changes   in the county plans because we are

          looking  for the mechanism for   the comprehensive plans that exist

          to accept whatever criteria that the State has decided must be       there

          in order  for them  (counties and municipalities) to do    their plans,

          isn't it  what you  are after, Mr..Daniello asked Mr. Larson.

                  Mr. Larson  replied, well i n the sensethat the S  tate should

          'come in where there are critical statewide questions to be resolved.

          The counties do that now in a very informal way in termsof the

          regulatory bodies that may be held in an      one of the   departments
                                                      y@

          and through the.TAC groups used when there     are some  specific. zoning

          problems, Mr. Daniello specified. You are      suggesting a statement

          of policy  at the State levelthat ought to     be if there is to be any

          plan for  the State. This statement of policy.must be acceptedby

          those who  have the authority for a land use plan.      This was

          Mr. Biondi's original question. Mr. Daniello said       he would  like to
<pb n="457" />

                                           20

         ..offer a general definition of the concept of a State land use

           plan. The plan would be an as  brief as possible statement of

           policy and criteria that the State must havelto carry out their

           functions through whatever problems they (meaning counties and

           municipalities) might-have. In the area of.standards, for instance,

           it would spell out that they would all use the same population

           figures; the same employment and unemployment figures, etc.

   DTION #1:      Chairman Biondi suggested the following motion: ."the

         Commissi on approve a recommendation for the creation ofa statewide

         comprehensive land use plan which would be developed in a cooper-

         ative effort with the full participation of all the departments of

         the State government, the counties and municipalities in the State;

         which would consist of a statement 'of policy at thestatewidelevel

         relating to those Areas which are of statewide concern, either
         because they are multi-jurisdictional in nature or they are of

         critical concern to the people o.f'the entire State; and which

         is not duplicative; and does not contravene the existing

         authorities of counties and local governments with respect to

         planning". This suggested motion was duly made by Mr. Larson and

         seconded by Mr. Wiener. -Mr. Wiener said he  supports the motion,

   r. TO but he objects to the word "comprehensive".   It might cause a
   ION #1
         @confusion as to what the Commission means,for.example, at the level

         of crossroad  designation and the other parts of the plan. The word

         "comprehensive" is associated with specificity., Mr.  Biondi was

         asked.to explain the word "contravene". Mr. Biondi replied that it

         means the counties would still have the  authority to plan through their
<pb n="458" />

                                           21

         existing planning authority: those    things that are done on  an

         almost ad hoc basis and not in any organized fashion (which contri-

       .bute to problems in processing plans) would now be done on a

         comprehensive basis with all statewideagencies involved in a state-

         ment.of policy, done with the  counties but not meaning to take away

         any authorities that the coun ties currently have. This would be a

         sort of a marriage. There are going to be.points of contact where

         there will be impositions of authorities.because some authorities come

         from the federal government, especially   from Mr. Bryson's Department

         where there-is no t too much.choice. As   I look at the range of problems
         that,the Commission memb ers have been talking'about, Mr. Biondi went on,

         it does not seem that we,have been talking from a planning point of.view.

         we need to look at the planning process by the imposition upon the other

         levels of government because there,is always going to be a point of

         contact in the practical carrying.out of   these plans where you make,

         a practical decision to put money in a bond act; to appropriate State

         funds; to make improvements. If it is not working together, cooperatively'

         it is assumed that someone will resort to the   power of the purse.

                Mr. Bryson mentioned.an example of an industry wanting to settle

         in a particular area where the water supply is   in critical shortage.

         This would imply that this industry would have   to use a water supply

         outside their area or maybe outside the-county

                M    Biondi said that at this point, the   Department of Natural.....

         Resources would be talking to the county in question that it    showed

         on its-plan an area for-industrial development where there is   a
<pb n="459" />

                                              22

           shortage of water. What we would hope to  accomplish with the

           State plan would be that it would reflect Mr. Brysonis input

           relating to water supply shortage. According to the State statutes,

           this industry would have to come to the Department of Natural.

           Resources to allocate water resources.

                 What the word '.'contravene" means is that Mr. Keifer cannot,

           tell Mr. Bauer what to do or not to do. What it means is that

           Mr.. Keifer (or Mr. Bryson) must sit down with Mr. Bauer and say

           here are the reasons why we think you are moving in the wrong

           direction, and try and come up with.some . solution to the problem.

                 Mr. Biondi said that if the State had a plan, as defined in

           the discussion above, there might not be too many situations whEare.

           people get involved in a regulatory application where they get

           kicked" from one place to another. The counties and the State

           would work together on what can be done in specific locations and

           they would have taken into consideration all the factors. There

           would be a coordinative effort.

                 Mr. Krapf is fearful that what the Commissionmight be

           creating is another "monster". Everyone agreed that this is an

           area where the Commission will have toexercise extreme caution.

                 Mr. Daniello said that he would ideally see the time that

           upon the approval by a county that has already accepted certain

           criteria there would be no need for the regulatory trip to the

           particular State agencies, because it has already been approved.

           Mr.. Krapf said that he sees where there could be some,problems in

           having a state plan and a county plan and a city plan all in effect
<pb n="460" />

                                               23

          that would-contradict each other.

                 There were no further.questions on-the motion. Mr.       Biondi

          asked for a vote on the motion as amended by Mr. Wiener. The

          motion passeed with one "no" vote.

                 Mr. Folsom said that-  the Commission-has,taken care of by the
          above motion the long range planning. There is an immediacy for
          short range planning that.occurs at budget      time. He would like    to

          see the Commission make some-sort of a    proposal that either-the

          State Planning  Office, by itself or-in   Conjunction with the other.,

          planning groups of,the State, municipalities and counties, review

          the various capital budgets and give-a,report as to more or less.

          what those budgets will support coordinately and  where they, are.

          out of phase and will not support. This is a key problem that the

          State-is not putting money where the county is putting money for

          development. This would give everyone &amp;short range picture each

          'year to-see dynamically whether or not the,plan is where the money is.

                 Mr. Daniello said,that there,would also have to be, some'

          mechanism for those subdivisions that have capital budgets to be
          willing to submit.their capital programs so they can be reviewed as

          an impact to the-State capital budget.

                 Mr. Folsom.said, certainly. All     he-is asking is  that a report

          be made of all the capital budgets. of all. the. jurisdictions. in-

          Delaware, including the State's, and howthese capital budgets
          relate to, the support of this State   plan, as  now being defined.

                 Mr. Webb commented that   there is, a,problem with this coordin-

          ative ,effort called "politicians". Mr. Webb  believes that the

          suggestionmade by Mr. Folsom    is brilliant.    One of the weaknesses
<pb n="461" />

                                                  24

            of the.State is that   the  counties'  governments do not necessarily
            come to the Legislators for their needs. The way things work now

            is the State gives too much advantage to the individual legislator

            who tries to get done everything.he can for his own area without

            giving thought or consideration to the total State. The legisla-

            tors-waste a lot of taxpayers' money because they put in the bond

            bill projects that have no-,business being there.,

                   Mr. Larson made a motion which was seconded.by Mr. Wiener

            that:  "the State Planning Office be urged, dt the earliest possible

            time, to'develop a. composite capital improvements program,of the

            State  municipal.and county governments. in the State; to present

            that composite program to the    governments,and to this Commission.

            (the Delaware Tomorrow Commission) - if it is still in existence

            to those items relating to the plan."

                   Mr. Folsom said that we    should only be interested in.those

            projects that impact the plan;      sewers, roads, etc.

                   Mr. Wiener suggested that Mr. Larson does not specify the

            State Planning Office as being the    agency to-do this composite.

            Mr. Wiener explained that it may be that a commission might be,

            given the charg Ie to do this composite. Mr. Larson responded he

            has no objection to this, but he mentioned that the State.Planning

            Office is in existence,   the Commission that Mr..Wiener speaks of,

            is not. At this point,    Mr. Biondi sugge  sted that the motion read
 ICION #2:as follows:     "The Statewide plan include (as a part     of the plan)   an
            on-going comparative analysis of    capital funding at   the State and

            local levels which impacts on the    plan." This was made as a new

            motion and was duly seconded., Mr, O'Donnell said that he may be
<pb n="462" />

                                                25

          speaking out of line    for his Director,   but he hopes that this job

          will be to such an extent that     the New  Castle County Department of

          Planning would assist the State in preparing this composite or analysis.

          Mr. Larson said that it is indispensable that there be a close

          coordination between the State and the counties because, at times,

          there is withholding of information.

                  Mr. Thorp had a question on the motion     with   regard to timing.

          To some  extent, before a budget    is.passed,.it  would  be nice toknow

          how it is matched in. On.the other hand, if        the budget onthebond

          bill is.not decided until late in the first session ...

                  Mr. Folsom answered that the ideal thing would-be..that the

          whole comprehensive or coordinated budgets.be compiled prior to

          passing. That is impractical. What we are looking for is a

          gauge  of how well we are doing in support of this.plan and.it is,

          just as effective.to us until we learn how to use it.whether it

          happens in July,   August, or September. It would be      ideal if we

          could  prepare this before the budget preparation. Mr.,Bryson noted

          that  the State  agencies will besubmitting theirbudget requests

          next  month any way.,

                  There was no  further discussion on the    motion and   it passed,

          unanimously.
                  Mr. Walton said that, on page 6 of     the Land Use  Committee

          Report  of April 1,  under "Transportation    Policies'! The    problem
          of water supply   brought up by Mr.   Bryson  i*s also true of  the land
          use; when one runs out of natural resources,   one runs out.    Delaware
          is going,to run out of land just as New      Jersey is  Inow. Delaware's
<pb n="463" />

                                                  26

            present position is   that of New Je  rsey twenty years ago. If this

            Commission is going   to look at Delaware   tomorrow, it will   have to

            look at the way it uses itsland. New highway construction        uses
            much land. It changes the land use patterns. The,State of
            Delaware should have a policy to use the right-of-way available

            to the full practical extent before buying new land. There        are

            some legislators with a lot of influence who can get a road

            dualized in  the middle of nowhere, but if it is State policy to

            develop the  existing right-of-ways without buying new land      for new

            construction, this would stop this practice. A good example were

            the improvements made   in Dover on.Route 13: full use of,the

            existing right-of-ways was made.. Mayor Carrollremarked that       the

            improvements wore made ten years too late. Mr. Walton made        the

            following motion: "the Commission approve a transportation        policy

            which would require   the development of existing right-of-ways to

            the maximum extent consistent with current planning before

            purchasing additional right-of-way." Mr. Walton said that he will

            accept the advice of the engineers.on this issue. If the engineers

            say that this corridor cannot handle any more traffic no matter how

            it-is improved,  then all has been done that can be done; but until
            the experts say  that the corridor cannotbe.used, the.right-of-ways

            should be used.

                   Secretary,Hall gave an example of     the Division of    Highways.

            having plan for  a limited access highway    from Stanton.acrossthe

            marsh and leading out toward Route,13. It was obvious to Secretary
<pb n="464" />

                                               27

          Hall, at the time, that it was   impractical; it  was tremendously

          expensive; and there  were historicalsites that    would have.to be

          dealt with. Secretary Hall recommended that the project be abandoned;

          and to plan to, dualize Route 7. There are no shoulders on Route 7..
          There. is no excess land there. This Route will have to be,widened

          and dualized.'.Is this what Mr. Walton is.talking about? This is

          an example, Mr. Walton said, of what the State policy should be.

                 Mr. Wiener  suggested that instead of"within      existing

          right-of-ways" the  word "corridor"..be sub,stituted   for "right-of-,

          ways"...It was finally agreed to use the word    "location".. The.

   ION #3anotion should read:   "The Commission approve a transportation.

          policyVhich would maximize the utilization of existingroad
          locations." The motion,, as.reworded, was duly made and seconded..

          The motion passed with.Secretary Hall and Senator Berndt voting no.

                 Senator Berndt  remarked that in his area, for example, the,

          Concord Pike is  fully utilized. Then., if   it not feasible, additional

          land is required    but whenever feasibleand available the,right-
          of-ways should be used, Senator Berndt was told. In this case,

          Senator Berndt approved the motion and changed his vote from no     to

          yes. Mr. Wiener asked.if.the motion just made would eliminate the

          need forany further consideration of.item 4, on page 5, ."Delaware

          should adopt uniform minimum statewide'land development standards"

          and item D. "Jurisdictional Arrangements" on pages..8 and,9. Mr.,Wiener,

          was told yes; and it also covers,paragraph 1, on page 1,     of the

          addenda paper of May 15  and paragraph.2 on pages 2 and 3,     of 'the

          addenda of May 15.
<pb n="465" />

                                                28

                   It was moved to take   a dinner break of about one   half hour

           and when the  Commission resumes business, the Report of     the

           Economic Development Committee be considered      and the coa.stal,zone

           issue be examined concurrently with the Land,Use Committee Report

           and the Economic Development Committee Report.

                   The Commission reconvened and considered the Economic Dev-

           elopment.Committee Report (referring to the latest document,,

           printed on both sides and dated June.26,,,1975) It is presented in

           a form of a  summary; after the summary, are Parts I, II, III,.IV,

           and V.

                   Mr. Thompson asked that themembers consider the parts first,

           then go back  to the summary to see if the summary reflects what was

           said in each.part.
                   Parts I through IV are essentially what has been reviewed

           by the  Commission before. There is one change in Part IV, which

           has to  do with the railroad..   It is a more explicit recommendation.

           This issue has to be acted upon by    the Commission bec ause the
           decision is going to be taken in    Washington later on this month.
           Part V@ is new,'and deals with the question of    income tax, capital

           gain taxes, and the coastal zone and offshore oil question. It is

           in Part V that the Committee reconciled its deferring views. These

           are the issues that contribut  ed in creating   an anti-business  picture

           and that created problems to the business,lea,ders and the State

           leaders. The Committee has presented the problems to the Commission

           but no  solutions were recommended by the Committee. The      Committee

           does not know what the answers are to the income tax and@capital
<pb n="466" />

                                            29

         gain rates. It may   well be that when  these  questions are
         -examined by a broad spectrum and qualified group in the State, it.

         may be found that it  has become counter productive; that we will be

         losing more revenue  as a result of where we are on   the income tax and

         capital  gains than we are in fact generating over   time. The other issue,

         the coastal zone, the  Committee felt it understood   it@better and it was

         a temporary action that was taken in 1971 to remedy to a particular

         situation and that-the State is ready to move toward statewide

         planning and that the coastal zone act 'Should be discontinued... With.a

         statewide plan and the disappearance of the coastal zone law, Delaware's.

         image statewide and-on the national scene would disappear.
                 Starting with Part I (on page 13, of the new summary); this

         is identical material to what the Commission has reviewed before

         except fora few changes in the-language. Therewas some disagreement

         between certain members of the Ec',onomic Development Committee, but

         after a meeting,.the Committee arrived at a total agreement    and   the

         summary report is the product of this agreement.

                 Mr. Wiener asked whether the.Commission is going to "lock in"

         on the population figure of 697,600 rather   than a general range.

         Mr. Thompson  said that it is an approximate figure on the high range.

         The population figure is not an.important   factor. The-number of

         people who will enter the labor-force within the next ten years is,

         what is important.   We should acknowledge the fact that there are no

         two figures on the  populat'
                                    ion estimates that:are in agreement in the

         State, Mr. Wiener commented.
<pb n="467" />

                                                30

                @.This figure*of  697,600 is   the Planning Office's estimate.

           It is the lowest figure used in this   area. The other studies

           that are being made are coming down   to that figure. An approx-

           imate figure should be used rather than such exactitude. A motion

   'ION Y/4:was made and seconded "to use a population f igure of 700, 000.

           The motion was carried with the exception of Mr. Krapf who voted

           no'. There were no other changes in Part I.

                  Part II (on page 19) was then considered.     Mr. Biondi

           suggested a change in the wording in paragr.aph .1, to read:

   .ON #5: (tD a low llth in 1970) but has recovered to fourth in the nation

           in calendar 1973." Dr. Latham suggested that the calendar      year

           1974 position be mentioned. Mr. Biondi asked Dr. Latham to       let

          ,him know the figure for 1974 when he gets them. A motion     was duly

           made and seconded to change the wording in the above mentioned

           paragraph. The motion passed unanimously.

                  In item 2, on page 19, Mr. Biondi suggested to substitute

           the second sentence by: "Delaware,ranked tenth in the nation in

           fiscal year 1972 and dropped to fifteenth in   thenation in fiscal

           year 1973." Mr. Thompson said that a different,i,ssue would be

           raised by this change. The point that was made was Delaware.was

           way down in the 1950's but it no longer is.,.Mr. Biondi said "and

           we are in the positions I stated, right?."   Essentially yes, Mr.
           Thompson replied. But the only point made    was,that the De.laware,'s

           position of the 50's has changed.

                  Mr. Daniello suggested a change in   the first sentence of

           the same item that would affect.Mr.   Biondi's suggested change,   to
<pb n="468" />

                                                31

          read:        per capita as most other   states."

                  Mr. Thompson said that the Committee meant to    compare only

          with.the surrounding states. Mr. Thorn asked whether the Commission

          .should get the impression that..in comparison to the neighboring

          states, Delaware's taxes are low? Mr. Thompson said no, compared

          to the neighboring states, Delaware's tax burden per capital is

                                              means is
          comparable but what Mr.   Daniello            that we should not

          comp are ourselves-only to the neighboring    states but with all   the

          states. As   soon as  Pelaware makes such statements, Mr. Daniello

          said,.we   are putting ourselves,down compared to our   neighbors. A

          question   was asked ds'to what was meant by item 2 on page.19..

          Mt.*-Thompson explained that at the outset Delaware has lost its,
          low tax  position compared to  the 195,0's when Delaware was attractive

          because  of the lower tax burden. Mr. Thompson said that this comp-1
          arison made between the 10's   may be construed as political motivation.

                  A motion was made b y Mr. Krapf, seconded by Mr. Daniello

    21#6: to change the first.sentence of item 2, to read: "The combined

          State and local,government taxes in    Delaware  now are as high per
          .capita as most other states." The    secondsentence remains,   as is..

          The motion passed unanimously.

                  There were no further comments or questions on    Part  II,

          therefore Chairman Biondi went'on to,Part,III.

                  Mr. Daniello,  to be consistent with his.last statement,.
          .suggested that any  reference to the7mid-Atlantic region" in
          Part III title. and  reference tolthe  "local" regional comparison

          of Delaware be  struck because he strongly felt that Delaware's,
<pb n="469" />

                                             32

          position in competition cannot  be regionalized. Delaware is

          competing with states that-are  not in the mid-Atlantic region.

   .10N#7:       Mr. Daniello made a motion that "the words  'in the mid-

          Atlantic region' be  taken out of Part,III's title." The motion

          was duly seconded and was carried.. It was further decided that

          any reference to "mid-Atlantic region" within the body of Part III

          be struck.

                 Mr. Folsom.mentioned item 6, on  page 25. He felt that this

          statement means that the State encourages inefficiency by rewarding

          the small, non-viable municipalities.  Mr. Krapf said no. The

          intent was that if industrial development takes place in  one county

          of Delaware, not only the county government and the school district

          should benefit from the property taxes, but since many State factors

          will be involved in having that industry located there, then the

          State should get some of the tax revenue. Mr. Krapf was emphatic

          on this interpretation.

                 Mr. Thompson explained that as an example, let's take

          Delaware City which has a very heavy industrial complex and very

          high propertytaxes being generated   for such a small municipality.

          We should look at this basis of sharing that.on a wider basis

          within the State.

                 Mr. Daniello commented that if we are going to talk about,
          a land use plan, and we try to direct industry in some location

          and eliminate competition in our own localities for the industry in

          terms of competition, there is got to:be a way of fair sharing the.

          revenue.. There is got to be a revenue sharing formula of property
<pb n="470" />

                                                 33

          taxes generated from commercial     and industrial among the commun-

          ities that generate it and the     communities that suffer because it

          is generated.

                  Mr. Conaway said that there     is one side that the   Commission

          is ignoring which is    the municipality or the county has    to provide

          services to that particular industry..        Are we going to say that

          everyone sharing in the@property taxes will also      have  to.share in

          the cost of the services of that industry? It is the        only fair
          .way to do'it. This would probably affect Sussex County more than

          anyone else since Sussex, Coun  ty would get more revenue down than

          would  come up. It would not be fair for the County not to pay for

          those.-services. Mr. Conaway said*he     would  be against that completely.

          Mr. Thompson said that the.Committee     was,not trying to   solve a

          problem but to   raise one..  There are  inequities in school districts,

          there ought to   be some way  to equalize this when a particular unit

          of government   does not profit unduly because industry is located

          there. Mr. Folsom    suggested that this item be.   worded as follows:.

          '.'the State.should study a reven  .ue-sharing formula for commercial-

          industrial taxes and charges,     so that all jurisdictions of our.

          small  State will share in these fees proportionate to the service.

          that  they provide.". The motion was seconded by Mr. Krapf, Mr.
          Daniello suggested that the.motion be amended to read: ."the State

          should study ... our small State will share equitably from these,

          revenues."

                  Mayor  Carroll commented,that this would eliminate competition

          as far as enticing people into a community. If money is shifted to
<pb n="471" />

                                            34

          support inefficiency, he can in no way support this motion.   If

          a community cannot afford to support industry, then, it should not

          accept industry in its area in the first place.

                 Mr., Schranck remar ked that the federal government's method

          of gathering statistics has changed. The.Department of Labor now

          gathers information on employment as-the place,.of residence of the

          worker. When the formula is developed, the Department of Labor takes

          the place of residence to determine wh at a particular area is going

          to get. So,, what the Report says in.item.6, is already being done.

          Mr. Wiener recapitulated by saying what the Report.is trying to

          recommend is for the State to study a revenue.formula. This cannot

          be done at this time. The cost of services should be taken into

          consideration (this is what Mayor Carroll was saying). We are

          saying that the jurisdictions of the State will share the taxes

          equitably. In certain cases, we  will have to subsidize an inefficient

          operation. In the case of communities with mostly residential,

          they will not want to share the burdens of air pollution, services

          and other responsibilities. What we are looking for.is those

          communities that are not able to attract industry because of

          ecological or.environmental reasons, and that have.a low income

          level, they not be penalized. We have to look at both sides of,

          the coin. What the Committee is suggesting is to study the matter

          and may.be we will find that an equitable formula is not feasible.

          Mr. Daniello said that he does agree with Mr. Wiener that a study

          should be developed to prevent a company to "jump across" a line

          and to leave a.particular area sometime unnecessarily because the
<pb n="472" />

                                                35

          county says it wants the-property taxes;    and  yet all the human

          services are still there. Mayor Carroll     said that this would

          encourage even more "jumping" because industry would go to another

          area,where they can 11get  away" with more. Mr. Wiener said     that this

          is where the study'.will develop a formula to avoid both.      Mr. Conaway

          saw the same problems in the school districts when he     was  involved

          in education..  This is opening.a Pandora's box. Let     us take the

          example of the beach areas. On   ce.-we start sharing industrial and

          commercial property, why not condominiums? We are going to end

          up with property taxes   all across the State. Mr..Biondi asked for
    )N#8: a mIotion, which-Mr. Thompson,made:-   "6. The State   should study a

          revenue  i@hdring formula for commercial-industrial revenue so that

         ,all jurisdictions of our small State    will share in  the revenue
          equitably."   The 'motion was seconded  by Mr. Wiener. It    passed

          with two no  votes.

    E #9:        A motion wag duly-made and seconded "to insert     the word

          Itransportation' in item 7., after the words 'sewer systems!"

          The motion passed unanimously.

                 Moving on to Part IV, Mr. Spencer explained that what

          Delaware has presently is good east-wes,t rail service but very

          poor north-south transportation both in terms of rail structure

          and traffic service., Mr. Thompson emphasized what is mostly

          needed is better service. For instance, when      duPont-Co. wants,to

          ship from Delaware toward North or South Carolina, the     freight goes

          all the way to St. Louis,   Missouri, and back rather than south

          because of the rate system, because of the different railroad      -companies
<pb n="473" />

                                               36

           serving. The rates would not be better but what is     needed is a

           direct north-south route so as to save 'time. This will be considered

           in Washington later on this month, between Conrail and the Southern

           System and the federal government. It was felt if the Committee

           supports some such policy (paragraph 2 of Section 1, of Part IV)

           on this issue; make contacts with the Delaware   Delegation in

           getting our Congressmen to move the Interstate   Commerce Commission

           to make the necessary modifications,in the    rate structure, it would

           be beneficial...

                  Mr. Biondi suggested the use of the    word  "support".instead

           of "adopt", because the State cannot adopt    such a plan. Mr. Wiener

   'ION#10:made a motion that was duly seconded that "the Commission adopt

           the position proposed by the Economic Development Committee with

           the inclusion of the amendment stated above." The motion carried

           unanimously.
  IION#11:        A motion was made and seconded that "the Secretary,of the

           Department of Highways and Transportation be requested to forward

           this statement of policy made by the Delaware Tomorrow C   ommission

           to the relevant federal officials dealing with the problem of:the

           Southern acquirement of the railroad  and the  rate problem.and that.

           it be also sent to our Congressional  Delegation and to the Delmarva

           Advisory Council." The motion was approved unanimously.

                 The full question.of transportation, Mr. Thompson said,      is

           a very complex issue and could be argued. The problem of theeast-

           west corridor and the passenger rail service is a problem which

           might be answered in the resolution..that was,just made  by the

           Commission.
<pb n="474" />

                                                        37

                     Part V was    then co  nsidered. In the second.paragraph of.

             this  part, the problems should be better specified than just

             speaking of the State's personal income tax and capital gains

             tax rate. This is a repeti        tion of an over simplification of the

             State income tax. It'is too simplistic. Specific figures should

             be entered in this paragraph. Personal income tax rates are at

             their highest (19.8%) and there         is no   limit on   the taxes on earned

             income and the capital gain'tax         rate,     This is.where the problem

             is.; it is  not in the whole structure pf the          State personal income
             tax.   A motion   was duly.made-and.seconded thatthe first sentence

    ON#12:of paragraph 2, of Part Wread as              follows:    "The core of this.

             controversy'revolves around the upper limit            of the'State.'s

             personal income tax rate at 19.8%; the lack            of a ceiling on earned

             income; and the 100% capital gains tax."             The motion passed

             unanimously. The second.sentence in..that            paragraph becomes      counter-

             productive.

                     Mr@ Biondi suggested       thatan     item  (c) be added to (a)      and
             (b) of paragraph 2,       to reflect that these  factors have,an adverse.  impact
             upon people.thinking      about establishing      major   corporate headquarters

             or regional offices      in, the State, as stipulated        in Mr. Richard Both'.s
             letter to Mr. Thompson       of May    27,.1975..  These   are not the     only
             factors that discourage       corporation headquarters. to settle          in,

             Delaware, but if we are       considering.points (a) and (b) without

             bringing out.this third       matter,   it is incomple.te.

                     Mr. Thompson said-that his committee was not just look               ing
             for the kind.of activity that will provide employment for the
<pb n="475" />

                                              38

          unemployed  and the underemployed  in the State.,.The  Committee was

          not just  looking for corporate headquarters to move   into Delaware,

          they were concerned about the total image of anti-business. It

          was felt that the letters presented as exhibits in the Economic

          Development Committee Report were not representative of the true

          industrial picture. These letters only reflect the interest of the

          highly paid personnel    not the average income workers. Mr. Wiener

          said we should look after the interest of the latter as, well.
          Item 2, on page 31, reflects the highly, paid.brackett. (over $30,00.0)
          and this is why this factor impacts the corporate headquarters and

          concernsthe executive positions.

                 Mr. Daniello said that the decision making process for a

          branch plant to be located in Delaware is being made   by corporate

          leaders and those leaders are affecting the location of the branch

          plant just as much as they ar e affecting the location of corporate

          headquarters.

                 Itwas   proposed that item  (c) be added, in the second parag-

          raph, on page  30, "these taxes,have  a particularly adverse impact

          on the location of corporate headquarters,and major regional 'field

          offices in,Delaware."

                 Mr. Daniello suggested  to amend this suggestion.    It  should

         ,be mentioned that this has an  adverse effect on locating    industry

          in the State.

                 Let us say that Corporation  A President in New York wishes

          to move a plant in Delaware.    He converses,with the President of

          Corporation B established in  Delaware. Corporation B suggests to

          Corporation A not to establish in  Delaware because the Executives

          (in the above $30,000 income brackett) will   be taxed a high rate.
<pb n="476" />

                                                    39

                    What the State is looking for       is a good diversity of

           industry. We should stop emphasizing.the.corporate headquarters
           and the regional fi    eld offices'.

                    A moti-on was made by Mr...   Thompson and seconded by Mr. Daniello

    ON#13:that "the following sentence be         inserted  as'the first part of (b):

           high personal income     tax rates are a serious detriment to the

           location of new business in Delaware." The motion passed unanimously.

                    Going on'to the bottom of page 30,.item (a), Mrs.           Slights.

           commented that she is     not sure that.proof has been presented, to

           justify the Coastal Zone Act1s responsible for the anti-industry

           image in Delaware. She was told         that  it is not the Act.but the

           controversy over the Act that does. It cannot be denied,that a

           debate   over the Ac.t.has been going,on in the State for the last

           two years. Some believe it is good, some believe it is bad.

           Mr. Daniello specified that there is no question that the 'controv-
           ersy over the Coastal Zone Act has caused, some problems in terms of.

           economic development. The Coastal Zone Act has not had an adverse,

           effect on industry.locating       here, but the   controversy has.

          'Mr.  Bryson said that we     are not saying that the Coastal Zone Act        has

           been  responsible for everything       thathas been    attributed to it,    but

           the  controversy and the     permit  system has been.to Delaware.

                    Mrs. Slights said.that     she would like to see the point

           explained that.the Act is not       contributive to. the bad image, only

           the controversy is.       So many  times during the controversy our

           industry image has      been blamed on the Coastal Zone Act that         the
           statement alone w.ill'be     construed to mean    that
                    Mr. Biondi   suggested the sentence to read: "The controversy
<pb n="477" />

                                                 4o

             over the present Coastal Zone Act     has been  reflecting in a continuing

             debate inthe State which has contributed to an anti-business image."

                  Mr. B ryson said that at the time the Coastal Zone Act was
             drafted (two versions of the Act were. made), it was not the intention
             of the sponsors, the Governor, or anyone involved for this law.to

             be the final answer to our problems in the coastal zone. The

             State had an immediate problem and a     temporary solution had to be

             found. Wi  th all the publicity it got, it turned out to be a great

             bill and it was not intended to be a great bill. It was meant to

             be a land use and planning concept to protect our       coastal   zone.

             It went too far in its overal   1 intent. We suffered somewhat in

             attracting industry and in our imagein an area where we should

             not have lost it (Get  ty and DeGussa, for instance).      A land use.

             plan will let alot of people have an input as to where thing;will

             go.

                  What about the recommendation of the-Land Use.Committee whereby
             the Committee support the recommendation of the Delaware Society

             of Professional Eng  ineers (page 4 on the addenda report of May 15)

             Mr. Biondi asked? The statewide land use management plan would

             supersede the Coastal Zone Actand other land use legislation

             presently administered by the State.

                  Mrs. Slights made a motion that. "the Commission      adopt the

             recommendation, as outlined in the addenda report of       the Land Use

             Committee Report in lieu of item (1) of the Economic       Development

             Committee Report." The motion was.duly seconded.

                  Mr. Krapf felt that the    way the Economic Development Committee
<pb n="478" />

                                              41

            worded that particular   issue is a lot better than.the recommend-

            ation of the Land Use Committee Report.

                 Mr. Biondi specified.that what he was proposing earlier,

            was that the Commission take the   statement from the Economic

            Development Committee Report (Item .(I), on page 31), then add to

            it the recommendation from the Land Use Committee Addenda Report

            of May 15, on page 4, item-(3), starting at "the present regul-

            ations should be used intact, as.interim guidelines, to govern

            development in theCoastal Zone    until the-new land use management

            plan and regulations are complete and   enacted. At that time, the.

            comprehensive statewide land use   management plan would supersede

            the cu-trent-Coastal Zone Act and  other land use control legislation

            presently administered  by the State."   This would make up a more

            detailed statement.

                 Mrs. Slights mentioned that the   Land Use   Committee Report is
            in agreement with  the Professional Engineers.    She felt 'that  the

            sentence "the Committee has concluded,that the    time has come  to

            replace the initial Coastal Zone Act with    a comprehensive state-.

            wide land use planning.act" was not needed.     Mr. Biondi assured

            her that no one implied an interim period.where there would be.

            no regulation. This is why Mr. Biondi proposed the two statements

            juxtaposed. Mr    Cooperson  commented-that in response to.Mrs. Slights'

            comment, he wants to  go on  record as understanding her position on.

            this issue and.his position on the matter is similar to,hers.

            What Mr. Biondi suggested is that the present regulation,be used
            as is until such a time there is a.  proper legislation to tak  e the
<pb n="479" />

                                             42

            place-of the  Coastal Zone.Act.

   IOTION #14    A final  motion was duly made and seconded that the second

            paragraph of  item (1). on page 31, of the Economic Development

            Committee Report read as follows: "This bill was passed in lieu

            of a more complex Coastal Zone Actwhich had been proposed

            earlier but r eceived little support.  In reality both bills were,

            an attempt to being land use planning  at the State level. The

            Committee has concluded that the time  has come to replace the

            initial Coastal Zone Act with a comprehensive statewide land

            use planning act. The   present regulations should be used intact,

            as interim guidelines,  to govern development in the Coastal Zone

            until the new.land use management plan and regulations are complete

            and enacted. At that   time the,comprehensive statewide land use

            management plan-would  supersede the current Coastal Zone Act and

           .other land use control legislation presently administered by

            the State."

                 ,Question on the motion: Mr. Folsom asked if this meant that,

            after the statewide  land use plan is adopted the Coastal Zone Act

            would no longer ex ist. He was told that this  was a recommendation

            on which the General Assembly would have to act and that the

            plan would also have to include regulations. The motion passed

            with two "no" votes.

                 Mr. Wiener said that  the Commission passed a motion that

            we want to see the land use plan undertaken. Apparently, the

            Professional Engineers' Report talked about  three years to.do

            this report. Mr. Wiener felt that three years is excessive. If
<pb n="480" />

                                                 43-

             there is nothing in   the motion passed earlierimplying      the need for

             rapid consideration   in  light of our concern of our economic

             development,we should    reopen that question and add on     to the

             motion regarding the time urgency required for the       adoption of

             a state plan to.act with    the necessary guidelines      not only for

             the coastal zone but the    critical areas management and all the

             other needs that exist.     If the Professional Engineers think that

             they are going to get a    long term contract out of this report,

             we should desillusion them. This plan should be done before the

             end of next year.

                  Mr. Larson said that    his Committee did   not agree  with  the

             time nece.ssary to prepare   this plan. The Committee.did not

             accept the notion that it   would take three    years to.do;   and  it

             .did not accept that it would necessitate an Act of the Legislature

             to get it started.    Obviously, if it takes an act of the Legislature

             we will not get the   plan started this year. So an Executive Order

             or even the existing enabling legislation under the State Planning

             Office Act, could get this plan started as soon as possible. -.The
             State.Planner, in his letter'of    May 9,  said that he could   produce
             a State plan by June.30,    1976.  Mr.. Bryson  was-fearful that the time

             span might be too short, for his   Department   to give the necessary

             input. If the Commission determines that we should move forward

             with the plan and something evolves,from the federal energy policy

             which at  the moment is iry a total vacuum, Senator@Berndt said that

             he will move toward   doing what  is.the right thing   for the people

             of Delaware and will try to get the energy necessary into the

             Valley.
<pb n="481" />

                                              44

                  Mr. Biondi noted that  what Senator Berndt will do as a

             Legislator is, of course,  entirely up to him, but what is needed

             here is a total point of view of the who  le State. It was felt

             that what the Senator was trying to express was a sense of urgency.

             What the Commission needs to do  is to issue some sort of a rec-

             ommendation with respect to the  initiation  of such.a plan; when

             it ought to be initiated; and thefeasible    expectation to get it

             done.Senator Berndt said that the State Planning Office, last year,

             received a grant from the federal government of about one half

             million dollars to do coastal zone management. What has been done

             with that money? More money   was just,allocated to the State

             Planning Office from the same source. Where does all.that money

             go, Senator Berndt asked?

                  Well, Mr. Biondi said, let's ask the State Planner, he is

             right here.

                  Mr. Keifer replied that it was  based on the amoun t of money

             that the Planning Office is getting  that we could get this state-

             wide plan done in one more year rather than the   three years of

          @.the program. The Planning Office just'finished     the first of the

             three years.. In my letter of May 9, Mr. Keifer   went on, when I

             said that the Planning Office could come up with a prelimin.ary

             plan by the end of another fiscal year,   I.based that on my

             assessment of the status of progress ofthe New    Castle County 208

             Program, this program is critical input   to the process; the fact

             that Sussex County in the eastern shore   is just getting started

             in the 208 Program; and hoping that we would  fit all the pieces

           .into a coherent program. However, I    do not see, Mr. Keifer said,

             how we can get all of this done andcoordinated in    less. than twelve
<pb n="482" />

                                              45

            months.

                 Mr. Conaway commented   that it is significant-that this

            group has been looking toward a:statewide plan toward land use and

            the only State-attempted land use   management is probably the most.

            controversial act that  has ever been done in the State.    I am

            wondering, Mr. Conaway  went on, what would have happened   if the

            Senator (Berndt) had not voted for   the Coastal Zone Act in 1971

            .and Sussex County was still in charge  of its coastline and New
            Castl,e County could do what it please  with the.Delaware River.
            I don't believe that.We  would be.sitting here and worrying about

            industry. I belL.eve.the same thing will happen when the State

            !come-s up with this p1an.

                ..Another issue that Senator Berndt brought up is the legis-

            lation that passed the.House regarding   the storage of oil. If   a

            man wants to build aplant, he can borrow the money in Delaware

            to build this plant; but he cannot borrow money here to build

            storage tanks. There is a severe gas shortage in Delaware.       We

            should be building storage tank areas some place to get the     gas

           @necessary in this State,but we cannot lend money to get this done.
            There. is a feeling all over. the State that refuses anything  that

            has to do with oil and.gas and(energy   and industry.

                 Mr. Thorn made a few remarks as   to the time table.   The.land

          _use plan is a good idea,   but neither  money norwishes will give us

            an ideal program. I believe that we    should give a lot of credence

            to what Dave Keifer has   to say. -If  he thinks that it takes a

            year, it is  very important that this  statewide plan be very

            carefully thought out.    If it can be done by the exp-erts in the

            time said,. fine, but the State  Planner should not be pressured unduly.
<pb n="483" />

                                                46

                  Mr..Bryson mentioned that Dave (Keifer) said a,preliminary

             plan. He wants to caution the Commission that he does,not have

             the manpower to provide the input necessary and keep up with

             the other functions of his Department. I can't see, Mr. Bryson

             said, getting a preliminary plan done.in less than'one year, may

             be eighteen months.

                  It was the general consensus that at the@time of the Coastal

             Zone Act passage, it was understood    that  the Act was an interim,

             measure until the publication of a state plan; nothing has been

             done since then; and now it is imperative tha.t a plan be developed.

                  Mr. Wiener mentioned that another urgent issue is that of

             gas and oil exploration and development off the shores of Delaware

             and their impact on the coastal zone area. We should plan very

             quickly or things will just happen to Delaware that we will be

             sorry for. The sense of urgency is not only correct but also

             might prevent chaos that might happen along the coastal area.        We

             are faced with the fact that the federal government is going to

             be moving. Mt. Webb mentioned th    at the federal government has

             already postponed the recent.schedule,for themid-Atlantic

             coastal states, (New Jersey, Delaware,   Maryland,  New York, and

             Virginia) from December 1975 until June 1976.      It is'.likely that

             it will be pos.tponed until after the 19,76 Elections; In other

             words, Delawar e canfit its plan within.that time-frame.

                  Mr. Walton wished to make a few remarks about the Economic

             Development,Committee Report. He felt that the figures, projec-

             tions, and statistics that the federal government has given

             should not be taken seriously (some of the figures were 80% off).
<pb n="484" />

                                              47

            When we can prove what the federal government    advances then we

            will know otherwise. We have a report that is     highly one-sided

            (the Economic Development Committee Repo  rt). He believes

            what is written in theletters (Exhibits), but if we are basing

            our arguments-oh sound principles,,then the other areas of

            industry should have been solicited. Why wasn't the "other

            side",such as the conservationists contacted to bring their input

            on what they felt the economic pressures.were? This represents

            an economicsolicitation    from one side.. Mr. Biondi said that he has

            not been impressed by the   letters.either..,The.only  letter that

            presented a balanced view   is the letter from Mr. Richard Both,

            of Hercules.  'The remaining letters reflect what thewriters

            were solicited  to say. If we wish.to have an exact opinion from

            the industrial  leaders, this, is the way the industrial leaders

            think. Just for   that reason,  theletters are significant.

                 Mr. Walton said that the   viewpoint of the industrial leaders

           .,is not representative of what  is being voted on and said by the

            Commission. Mrs. Slights -said   thatshe disagrees with Mr. Wiener
            who said earlier that we ought   to develop abroad land use plan
            quickly; at the same time we   are incorporating thi's recommend-

            ation with the land use plan   that the Land Use Commission has

            adopted which says that this   plan is going  to superse'de all the

            other plans that are already   in existence.   She does not believe

            that a broad base land use.plan.for the State.is going to be enough.
            to allow to drop the existing legislation, We have got      to have

            more than a broad base or else she will withdraw her s   Iupport of
<pb n="485" />

                                                48

             the previous recommendation to ado   pt a land use plan to   supersede

             these existing legislation. Mrs. Slights suggested that the       experts

             be asked.what they think a reasonableamount of time is.to

             prepare a well-.thought plan.

                  Mr. Larson  said.that given the constraints.of budgets,     staffs,

             etc., I believe  that Dave's (Keifer) projections are reasonable.

             It does not mean  to say that less time could not be taken if the

             money.,. the people arethere. But more critical than just th     e

             technicians are  the conclusions of the.leadership of this State,

             through this Commission; what the implementation tools are. Shall

             we go to performance standards;.if we go to performance standards,

             what will they be? These are the.que,stions that should be resolved

             by the leaders to allow the technicians to    get to work. This should

             be done quickly. The time will determine what you put into it.

                  Mr. Weiner said that he had hoped he had not conveyed the.

             notion that the work be done in a    'sloppy" way or simply be a

             "hit and miss" plan. I believe that no technicians can capably

             deal with the substantive detailed, issues.unless the broad policy

             guidelines are developed in   a clear fashion. At that point, simply
             the application of manpower   and the background data can be brought

             to bear and to come up with   a meaningful plan. The    urgency is

             that the Governor  set up a body which will begin to    deal with the

             kind of problems we are talking about immediately.      I did not

             intend to imply that it is got to be a "signed off"     plan, Mr. Wiener

             said... The major debate is where we want to go. This can be done.

             at this.Commission level. The kind of motion we made earlier
<pb n="486" />

                                               49

            is the kind that we should urge the Governor to act on tomorrow.

            The fact remains that if we do not have this sense of urgency

            then it will drag again.

                  Mr.  Cooperson said he  agrees with,Mr. Wiener that the state

            of urgency exists, but he    cautions everyone that the kind or urgency

            implied by Senator Berndt    is out of place and it is why a year

            was lost because if this sense of urgency had been put into a

            thoughtful plan a year ago instead of the intent to throw another

            piece of legislation and put it through a political       circus.the

            way the last one was conducted,. is not going to get     us anywhere.

            There is nothing to be gained by getting a new.law      together.
                  Senator Berndt asked if anyone knew where the,coastal zone

            is. There are areas that are not in the coastal zone       that should

            be and vice-versa. Dutch Creek all the way to      Smyrna  should have

            been included in the coastal zone, for instance. Odessa.should.

            be included in the coastal zone.

                 Mr. Biondi suggested a motion be made that a statewideland

            use plan be prepared and be ready for enactment by May,l, 1976,

            (which is a month beforethe federal government is going to lease

            places and  three years before anyone will drill). Mr. Biondi said

            that he  gets the general impression that there is much,federal.

            money floating around in the coastal zone management and,other

            areas and, it requires some grantsmanship to allocate this money

            to get the job done. Mr..Folsom suggested a modification.to

            Mr-. Biondi's propose .dmotion to read that the. money necessary    to

            produce  that plat be  sought and@pol,icy discussionsbe started     within
            two weeks.'.Mr. Bryson said that he does not wish to hold up       the

            progress of this   projecti but given his manpower, he cannot give a
<pb n="487" />

                                            50

            meaningful participation to this plan-in that time span.(SEE INSERT)
                 Mr. Keifer said that he got $250,000 from the federal

            gove rnment last year.

                 At this point, Senator Berndt wished to change his. vote

            from a "no" to a "yes" on the previous motion dealing with

            item (1), page 31, of the Report of the Economic Development

            Committee. Mrs. Slights wanted to know whether the Commission was

            going to consider the last sentence of item (3) of the Addenda

            Report of May 15, of the Land Use Committee Report. Mr.  Biondi

            replied if Mrs. Slights wished to,.the Commission would.

                 In relation to the Economic Development Committee Report in.

            general where there were significant changes in the new draft

            from the original, were the changes based in large part on the

            exhibits that came with this report?. Parts I, II, III, and IV

            were unchanged and are not related to the subject of the letters.

            Was Part V rewritten on the basis of the Exhibits? Mr.  Thompson

            replied no; the letter just show specific evidence from business

            leaders indicating the nature of the problem in the industry and

            economy of Delaware. Who solicited thes.e attachments, Mrs. Slights

            asked?  Mr. Krapf said he did, within an assignment by Mr. Thompson

            who appointed a subcommittee for this purpose.  Mr. Krapf was a

            member of that subcommittee.

                 The Commission has debate d not only policies, not only sections,

            but paragraphs,, lines, and words in this report, and this Commission
            has tested the substantive value of what has been argued, Mr.. Biondi
            said. Our obligation here is to discuss the probl ems on their
            merits and test eachother's ideas across the table and see if these
<pb n="488" />

                                               5 OA

            (INSERT)

    ION #lA:     A motion was duly made   and seconded that "the Commission

            recommend that a statewide land use plan be developed by May 1,

            1976;, that the funding sources necessary to carry put the effort

            be ident ified and sought to whatever levels of governments they

            are available from;  and that within.the next month planning

            mechanisms be established as to how.thi.s is going to take place

            procedurally and as to who will be involved in cooperative efforts, and

            how it is going to get done. The Governor should take thelead

            to do this." The motion passed unanimously.
<pb n="489" />

                                             51

            ideas are valid and try to persuade each other.

                 Part V, Mr. Thompson said, is a fair representation of

            the views of the Economic Development Committee. The whole

            Committee was not in attendance at any one meeting, but during

            the series of meetings that we.had, I think we had a fair rep-

            resentation of the Committee.

                 Item (2), on page 31, of  the Economic Development Committee

            Report was then considered. Mr. Biondi suggested to add a

            separate section (e) to state that an additional objective should

            be a candid assessment of the position  of business.and industry

            in the State with respect to taxes as  compared to other states and

            consider ing the fact that the corporate franchise tax is a tax

            which we export largely. Such a study ought to indicate just

            where we are with respect to taxation of business and industry.

                 If for example, it is determined that we should reduce

            the income tax atthe highest level,  we will lose a given.amount

            of revenue from that; and if it is.determined that we will slice

            thecapital gains tax, the State will lose revenue from that. In

            determining where that revenue should be made up, we should not

            only see where we are in taxation of individuals and consumers,

            but we should look at where we are with respect of business and

            industry. Frankly, the reports which have been used by industrial

            leaders including the corporation franchise tax which is exported,

            not paid by local industry, are not representative of what the

            true tax burden on business.is. In fact, we are compared favorably.

            Mr. Biondi would not want.to see a tax study made to go up on the
<pb n="490" />

                                            52

             idea where we are going  to replace the revenue we are going to

             lose from changing these taxes and look only at imposing that

             revenue in some measures on the individual taxpayer and consun, r

                                 usiness  is                       red.to other
             and not look where b            in terms of tax compa

             states.

                 Mr. Thompson feels that  a look at the whole tax structure

             should be seriously given.   He feels that item (d) reflected all

             aspects of revenue   not just the individual taxpayer     but if

             Mr. Biondi wishes to add on to that item, it is agreeable with
             Mr. Thompson. Mr. Biondi@asked that the following end of
   CION#15: sentence be added to item &lt;d)  Ion page 32: "including the relative
           -!.burden of taxation on manufacturing and business in @he,State."

                Mrs. Rita Smith wanted to clarify a point that the Commission,

                                                                            t
             is saying that-business is in good relative position taxwise o

             operate in Delaware, but we are not able to.attract business

           .because thebusiness leaders are making decisions on their own,

             personal income tax. She was   told yes, this is what happens.

             Mr. Biondi's sugge@stion was made into amotion  duly seconded.

             The motion passed unanimously,

                Item (3), page 32: The drilling for@oil    and the development

             of deepwater port is more than a question  of the reaction of the

             State to it, it is a question of economic  feasibility. State

             planning should take into account the judgment of industry with

             respect to the economic feasibility of these matters. Mr. Thompson

             mentioned that there was some feeling,that the State was tending

             to drag its feet in terms of.being willing  to participate in this

             program to develop offshore. The offshore.activities may not
<pb n="491" />

                                            53

             commenced right away and the onshore activities might be

             located in New Jersey and Maryland and Delaware would be left

             behind. The  Committee did not feel that the Statewas "dragging

             its feet" but the concern was that it should not. We wanted to

             encourage the State to take a positive attitude rather than

             a negative one toward the possible participation of the State

             in this effort to develop offshore and  do it in the way that

             the Governor's Office has been doing it.

                 Mr. Webb remarked that people confuse local attitudes with

            .State attitude. The State's attitude at   the Executive level,

            @along with the Chief Executives of the surrounding states, is

             identical. This issue is being worked on a regional basis on

             the whole problem of the Outer Continental Shelf. It may be

             that one particular community in one particular state has one

             attitude about the matter, but it does not reflect the attitude

             of the wholestate. Everyone involved is trying to develop a

             positive plan for offshore development in the whole  region..

   IOTION #16:   A motion was duly made. to change item,(3) to read: "In
   e p.57 for
    nDtion)  order to maximize the future economic benefits while   minimizing

             any detrimental impact, the State should establish a  program to

             participate in the Atlantic offshore drilling and/or  the develop-

             ment of deepwater terminals." The motion passed unanimously.

                 Mr. Wiener mentioned that the title of Part V is awkward.

             Two or three different issues are considered in Part V and the

           .@title does not reflect what is being discussed in the text. it.

             was also mentioned tha t Part IV.which discussed the transportation
<pb n="492" />

                                           54

            and railroad problem, the economic  problems of Wilmington and the

            housing construction business drop  in Delaware, has nothing do

            do with the "Quality of Life" in Delaware. It was suggested

            that Part TV be titled "Problems Affecting the Economic Quality

            of Life in Delaware". Mr-Biondi said that Part V title will

            be reworded.

                The Commission needs to consider, yet, the following:..

                1. First, the need   for a policy decision on the rate of

            growth. This will have   to be considered partially withdiscussing

            of the Cost of.Public Services Report-The minutes of the     last

            meeting will be  helpful with respect to that. The discussion

           .is laid out-well  regarding the overall rate of growth thatr

            Delaware should  seek to achieve in the next tenyears.

                2. The memorandum by Dr. Latham entitled "1985 Forecast    of

            Revenues and Expenditures of Major Delaware Governments."

                3. The summary of the Economic Development Committee    Report..

                4. The recommendation of the Land Use Committee Addenda

            Report of May 15, regarding proposal of interimlegislation    dealing

            with lightering, aquifer recharge, and tributaries..

                The next meeting of the Commission will be held on July 10,

                          p.m., in  the Wilton Center.
            1975, at 4:00

                After this recapitulation of work left to be  done, Mr. Biondi

            went on with the remaining  statements on pages 32.,and 33 which

            represent an explanation of  item (3).

                Mrs. Slights missed part  of the vote and explanation of.item (3).

            She explained that she was asking Secretary Bryson.a question

            apart in regards to item (3). Mrs.-,Slights wished  to ask
<pb n="493" />

                                            55

             whether this   statement concerning the deepwater terminalwould

             bein keeping with the present Coastal.Zone Act? If yes, then

             Mrs. Slights would like a statement to that effect inserted in

             item (3), to clarify the full meaning of the statement.

                 Mr. Biondi said he would not support this because it would

             be inconsisten t with the recommendation. The law exists and if

             the State does not have a statewide land use plan before July 1976,

           ,,it will remain  in effect and the State cannot wait until then to

             plan what the  impact would be on.the State of offshore drilling.

                 Mrs. Slights said that she does not  wish to change the

             statement; she wants to make certain that thestatement is     in

             keeping with the Coastal Zone Act.

                 Mr. Thompson said that when the-Committee.  dealt with the,

             question of the.Coa.stal Zone Act, it felt that the Act should

             be considered along with the planning effort. It is one action.

             Apart from that, the State has to start thinking how it will

             interface wi-th the offshore oil and gas drilling or a deepwater

             port,

                 As.the statement is written, Mr. Daniello said he understands.

             it to be for any kind of program that the federal government is

             talking about on an offshore,port anywhere. Secretary Bryson

             s
               Ld that there are two policies in the statement. We certainly
              aJ

             do not want to g ive the idea that we want to do away with the

             Coastal Zone Act. As far as the State's participation in the

             offshore issue it is mandatory that we do. He feels that the
             State has done a. good job on interstate participation and coordin-

             ation. The second part of the statement regarding the deepwater
<pb n="494" />

                                             '56

             terminal, Mr. Bryson does not agree with it, unless: it is

             within the constraint's of the present Coastal Zone Act.

                 Mr. Daniello said that presently the Office of Technology

             Asses'sment.(OTA) is doing a study on the feasibility of deepwater

             ports along theDelaware, New Jersey coast. If Delaware is

             se tting a policy in such a way that it cannot parti  cipate in the

             study that is being done because the State-happens, to have a

             Coastal Zone Act, it is ins  ane not to be  the-,ke.to get and,lgive

             the input.

                 Mr. Bryson  reiterated that he  has no  objection to the ideas

             advanced if they do not  violate the Coastal   Zone Act. If they

             do, Mr. Bryson  said he does not wishto participatein any.of it.,

                 To clarify  the statement, it was proposed to add to item     (3)-

                                         evelopment of deepwater terminals."
             "and any studies  for the d

             Mrs. Slights still wished to add "within the co.nfines,of the

             Coastal Zone Act."

                 Mr. Thompson said that the thrust of this statement is.that

             the State cannot close  its eyes to what is going on.. May be the

             State will want to considerthat the Coastal     Zone Act be modified

             to permit the development of a deepwater port    because of  such and

             factors. The State should not make the statement that it      will

             not even consider it  b,ecause of the Act.

                 Mr. Walton asked.if the   Coastal Zone Act.would prevent   the

             State from participating in   studies. No, was Mr..Thompson's

             reply. But the change in the. language would have you do this.

                                   n
             Adding to the stateme t would disallow the State's, participation
             in the study.   There was disagreement there further expressed
<pb n="495" />

                                             57,

             by the members  of the Commission. Mr. Daniello said that if

             the federal government or another state were to propose some-

             thing that may or may not affect or be in violation of the

             Coastal Zone Act, the State of Delaware should be a part of it

             all   if for no other reason to say that we.object because of

             the Coastal Zone Act.

                 Secretary Bryson specified that he cannot be involved in

             the participation of the development of a deepwater terminal

             because of his position,on the Coastal   Zone Industrial Control

             Board,

                 Mr. Biondi attempted to finalize. the  statement under  item (3)

   ITION.IP17:to reflect,all that was said, as follows: "(3) The State

             should establish a program to participate.in the Atlantic offshore

             drilling for oil and studies for the development of deepwater

             terminals in such a way to maximize the future economic benefits

             while minimizing any detrimental impact." The motion passed:with,

             two "no" votes.

                 Mr. Daniello said suppose we talk about the development of

             the @Port of Camden, the Port of Wilmington, or the Port of

             Philadelphia - the development of   either. The  only thing we are

             saying is that the only  thing we can do is to  study. We are not

             to be a part of the.development.   Well, Mr..Biondi said,    how.

             can we be part of the developmentof a deepwater terminal if it

             violates the Coastal Zone Act?

                 Mr. Wiener said  let's take a hypothetical  example that the

             study determines that  the terminal should be  in Delaware. Obviously,
<pb n="496" />

                                               58

             our representative who would study the issue would have to make

             the rest of the group aware that legislationin the State of

             Delaware would have to be changed before the     terminal can be

            @settled in Delaware. What we do not want to      say in this state-

             ment of policy is lees not talk about it because we.have the

             Coastal Zone Act. The modification proposed means that we will

             participate in the study, and in the discussions        no more,

             no less.   If the s.tudy reaches.the:decision   that theterminal

             should b e in Delaware, then the   confrontation has to belfaced.

             We cannot  hide behind any   language._

                 'To carry this further,  Mrs.  Slights said,-as   it was said that

             Delaware.should not hide behind    the is-sue this   is specifically

             why she would like the Coastal Zone Act,to.be mentioned because

             it is the issue.    Mrs. Slights does not agreethat everyone

            'Wishes to' have the Coastal Zone Act modified. Mr. Webb wished

             to take the next   paragraph out., He explained that Delaware is

             part of a group   called the Mid-Atlantic Governors Coastal

             Resources Council, including Virginia,.New,Jersey, Maryland.,

             and New York thatis involved in     very close cooperation through,

             a consortium of governors in developing a regional approach to

             offshore drilling. This statement could create a problem at the

             interstate level.by having the phrase "the development of deep-

             water terminals" because the four other states are categorically

             opposed to it. If "economically feasible" were inserted-between

            '"terminals" and"in" it.would solve an interstate problem        that

             may arise.
<pb n="497" />

                                             59

                 Regarding the second  paragraph of item (3), there   is nothing

             wrong in saying that Delaware should encourage development    relating

             ,to offshore development or outer continental shelf, but when it

             specifies deepwater terminals or offshore drilling, it creates,

             a problem.

                 Furthermore, Mr. Webb  said, the way..the federal law is

             written,.there is gubernatorial  veto andat   the present time,

             anyone wanting to put an offshore superport   in-Delaware, outside

             the coastal zone, or up in Marcus Hook., would be opposed by the

             Governors of Maryland, New Jersey, and possibly   New.York because

             the Governors are opposed to it.

                 Mr. Biondi responded that ifthis    Commission wishes to make

             such a statement, he sees no reason why-the Commission should

             not do so, independently from  what the MAGCRC's position is.

                 Mr. Bryson said.that he sees Mr. Webb's concern. What

             MAGCRC is doing goes far beyond any individual boundary. We

             are trying to achieve a regional voice with the federalgovernment.

             A few months back, we were out crying-in the wilderness with

             no one to hear us. We have gotten together with out neighboring

             states and now the federal government is listening to us. We

             now have a chance to participate in the',offshore drilling of oil

             and to carry out the next part which is to make sure that we

             minimize the environmental impact; and   to maximize our future

             economic benefits.

                 What Skip (Webb) is saying is that  we should not do anything,

             purposely, that would compromise  our pos ition with our sister

             states because it is the only voice that we have in all of this.
<pb n="498" />

                                           60

                Mr. wiener asked if we are saying that we want the offshore

            development but we don't want the oil to come to our shore in

            Delaware? Actually, this is our present position under the

            Coastal Zone Act, but the fact remains that the program has    to be

            for deepwater terminal at some point. What we are taUdng about

            is strictly participation in the study without trying to

            pre-prejudice an yone's concept of what  is in the best public

            interest. At the same time, MAGCRC is    there representing the

            interest of the five states. If a deepwater terminal is going

            to be detrimental to the development of our state, we expect

            our representative to fight against it and veto it. This, is

            consistent with the federal policy. Now what we are considering

            is'the fact that we recognize that if we are.going to favor

            and consider the w*hole question of the impact  of the offshore

            development in order to  maximize the economic  effects, then we

            also want to be participating to see where and how that deepwater

            terminal situation is going  to be handled,. Mr. Bryson said that

            our coastal zoneposition would jeopardize our chances with

            MAGCRC. No formal action was   taken On the  suggested amendments

            to the previous motion.

                Mr. Biondi adjourned the meeting.      On July 10, the Commission

            will consider the second  paragraph of item  (3), on page  32.
                                           R@:tfully     submitted,
                                                 UA4@
                                           Francine Booth
                                           Recording Secretary

            FB
<pb n="499" />

                                                   June 11, 1975

             TO      Pete Larson
                     Jcann Slights
                     John.Walton
                     'Steve Chamberlin

             FROM:   Daniel S. Kuennen, Area Agent
                     Community Relsource Development

             RE:     Conservation and Open,Sp4qe, Findings:     #3

                   As you will recall from the June 9 Delaware    Tomorrow
             Commission Meeting, Chairman Biondi asked that     I  get to-
             gether with you to draft a clear definition     of  'open space'.

                   Of course the'time-precludes gettirg together prior
             to the June 16 meeting so that I have drafted some ideas'.
             you may want to revise or respond to at the next meeting..

                   If.you have any questions or comments    please call
             me at 856-5250.

                   Thank you for your cooperation.

                   Best regards.

             cc:   Francis Biondi
<pb n="500" />

                               CONSERVATION AND OPEN SPACE

           Findings

           3.)   It is clear that there are two ways of interpreting
                 open space. Open space is (generally.) all land and
                 water not pre'sently covered by buildings or structures.
                 In this.view open space is a counterpart. of development.

                 A second more specific approach regards open space as
                 a clearly defined area designated for preservation in
                 its own right. It is not considered merely as space
                 which has not been developed. It is land dedicated
                 to a specific use (open space) much like developable
                 land is designated for a specific use (i.e. general
                 residential).

                 Open space could include   designated areas such    as  (but
                 not necessarily limited to): scenic areas, streams,
                 rivers, lakes, ponds, flood plains, beaches, prime
                 agricultural land, wetland marshes, swamps, wildlife
                 areas, parks, etc.

                 Delaware should.prepare.a land    use plan that specifies
                 a percentage of remaini'n"g undeveloped land and de-
                 signate a portion of that land to remain undeveloped
                 as preserved open space.

           Implementation

                 There are several'mechanisms fQr assuring open space.

                 Public acquisition is one approach. There      is little
                 doubt of its effectiveness but the av'ailability of
                 funds is questionable. There are also other major
                 considerations: 1.) loss of tax revenue through
                 removal from tax rolls; 2.) opposition of ownership
                 to government owned land; 3.) many owners not willing
                 to sell or agree on an equitable price and 4.) the
                 high costs of land acquisition diverts public funds
                 from other objectives (i.e. housing, education, etc).

                 Conservation easements, a second approach, is the
                 acquisition by government to conserve environment
                 amenities. The owner continues to.own the land.
                 The land development, however, is subject to the right
                 of government restriction. The easement runs with the
                 land and binds all subsequent purchases.

                 Easements are cheaper than land acquisition. Farmers
                 for instance, can continue to farm their land and are
                 paid the difference between the value of the land with-
                 out any restriction on development and value of the land
                 as restricted. Lastly, the land remains on the tax rolls.
<pb n="501" />

         CONSEiVATION AND OPEN SPACE
         Page 2

              The National Park Service after 20 years experience
              with easements concluded: "easements breed raisunder-
              standing, administrative difficulties are.difficult
              to -enforce, and cost only a little'less than the
              fee".

              A third and newer concept is the Transfer of Develop-
              ment Rights (TDR). Every  owner of preserved open space
              would receive certificates of development rights in an
              amount that equals the percentage of assessed value of
              undeveloped land to the total assessed value of the un-
              developed land in the jurisdiction.

             .Other measures are: critical areas  zoning;,encourage
              gifts, etc.
<pb n="502" />

                                        DELAWARE TOMORROW COMMISSION

                                     Minutes of Meeting of July 10, .1975

                   A meeting of the.Delaware Tomorrow Commission was held.on July 10, 1975,

              ,-t the Wilton.Community Center. The following members were present:

                        Mr. 0. Francis Biondi    Chairman
                        Mr. David.R. Keifer
                        Ms. Dorothy Greer
                        Secretary John D..Daniello
                        Mrs. Joann D. Slights
                        Mr. James H. Gilliam,  Jr.
                        Mr. Ernest W. Thorn
                        Mr. Frederic G. Krapf,  Jr.
                        Secretary John C. Bryson
                        Mr. Ross E. Anderson, Jr.
                        Senator Robert J. Berndt
                        Mr. Carl S. Oldach
                        Mr. John F. Walton
                        @Mr. Jay.N. Cooperson
                        Mr. Peter A. Larson
                        Mr. Richard Bauer@(voting  proxy for Melvin  Slawik).

                   Also present:

                        Mr. Lance Werner
                        Mr. Bob Meinen
                        Mr. Steve Chamberlin
                        Ms. Merna Hurd
                        Mr. Bernard Dworsky
                        Ms. Rita Smith
                        Ms. Peg McClane
                        Mr .Raymond H. Malefant
                        Mr. William R. Latham,  III
                        Mr. Eric Brucker
                        Mri. William Markell
                        Mr. Arthur Krieger

                   At the last meeting the  Commission discussedthe Economic   Development

              Committee report from page 13  to page 32. It was agreed,to amend (3) to read

              "...drillin g for oil and should study the dev elopment of deepwater termin,als...Il.

                   fl/Ir. Biondi noted that, at the last meeting, objections were raised to the

              next paragraph, specifically,  the sentence "Delaware should take the initiative

              to encourage such developments...". He said the principal objection to this

              phrase was the idea of developing deepwater terminals. He    said that Secretary
<pb n="503" />

                                                       2

               Bryson expressed concern that this statement might cause some problems   in

               dealing with the policy decisio ns that have been made by the Maryland,   New

               Jersey, Virg inia and other governments about deepw,ater terminals,. Secretary

                      said that MAGCRC has been very important to us in
               Bryson                                                    giving us a voice

               within the federal government. This is   +he first time the federal government

               has recognized, at least a group of states., They won't recognize individual

               states. We do  have a role to play and we do have some impact on the shorelines.

               For the first time we are getting information that was,previously considered con-

               fidential by the federal government., Secretary Bryson.said he felt it.was

               important for the Delaware Tomorrow Commission'to-protect this position.

                    Mrs. Slights said she feels It cannot be assumed.that deepwater terminals

               are going to develop along the east coast. She moved that the first sentence

               of this paragraph be stricken completel'y, because it is an,arbitrary statement'

               that doesn't belong In the Delaware Tomorrow.Commission.Report.
                    Mr. Krapf moved that the first sentencelbe amended',to read:   I'Deepwater

               termina-Is and offshore drilling,appear likely to develop along the  East Coast".

               This motion was seconded by Mr. Weiner.

                    Mr. Thorn questioned the need for  clarification.of deepwater terminals..

               It was agreed that this term covers all concepts of bringing oil to shore.

                    Mr. Krapf moved that the entire paragraph be.amended to read "Deepwater

               terminals and offshore drilling may develop along the East Coast.   Del.aware should

               be alert to and involved Jn such developments, both to reap the benefits of   the

               job and revenue  opportunities and also to maintain control to avoid undesirable
               environmental and other affects."  'This motion was secondedby  Mr.'Kreiger.

               'Mrs. Slights recorded the only  no vote.

                    It was,m'oved.and seconde,d,to.accept the remaining content on page 32 and..'

               33. This was agreed  to by al I @present.,.
<pb n="504" />

                                                        3

                   The Commission began the review of this report on page 13, so they then

              went on to discuss pages 1-13. Mr. Biondi asked the Commission       to be aware

              of the fact that most of these issues have been,discussed previously in.

              pages 13-33.

                   Mr. Krapf  noted that this summary is a synopsis of everything (in the

              Economic Development Committee Report) previously discussed. He felt that the

              Commission should agree to substitute duplicate issues,w,ith     what was previously

              agreed to by the Commission.

                   Mr. Biondi asked if there was any    disagreement-with  the concepts

              illustrated in I.A. Mr. Weiner    raised  two points: He felt that the    use of

              the word growth should be cl.arified as   there are two essential kinds   of growth

                            population growth..  He felt that  the intent of  the word  "growth"

              is not really  clear in  certain sections  of these statements. He.suggested that,

              in the final write up,   this distinction  be.clarified.

                   Mr. Biondi asked   Dr..Latham what kind of growth did he perceive this

              report to be.addressing - population or economic and how would, he differentiate

              a measure of economic growth from population growth.      He was told that this

              report was primarily based   on population.. Mr. Biondi   noted that 1. (a), (b) and
              (c) seem to relate entirely   on, population growth.'

                   Secretary Danlello, a   member of the Economic Deve.lopment Committee, said,

              he thought the Committee meant both population.and economic growth in.l. A.

              Mr. Biondi didn't feel that,the findings are consistent with.both population

                                                                    e discussed both population
              and.economic growth. Mr. Oldach    said t he Committe

              and jobs. Mr. Biondi asked the Committee to meet and cl*arify it's       thinking

              and discuss the concepts of population and economic growth separately and      state

              their conclusions with reference to specifics In each category.
<pb n="505" />

                                                     4

                   Mr. Chamberll.n suggested that the Committee not only look at population and

              economic growth as the two primary elements of growth, but  that they,also look

              at some of the other aspects of growth that might tie together the conclusions

              of the Land Use Committee with the Economic Development Report, etc. He suggested

              that the Committee compile an entire separate section@which speaks basically

              to and defined those two major points; that is, population and economic growth

              and perhaps single out some indicators.

                   Mr. Weiner made a motion that Section A be sent back to the Committee to

              define a little more clearly the characterist.ics,of the population and economic
              growth and the'interrelated factors. This motion was seconded by Mr. Krapf.

              All present agreed with Secretary Daniello voting no.

                   Mr. Biondi stated that Mr. Webb has reviewed Section 1. B. (c) and had

              the Budget Office prepare a study of debt service as percent of general fund

              disbursements over the course of years. Mr. Webb suggested that this paragraph

              be reworded as follows:

                   "The cost of past long term borrowing (debt service for interest and

              principal repayment) has Increased In dollars significantly. However, as a
              percentage of annual total General Fund Disbursements, I t peaked in 1961 at 20,%,

            :declined to 18.1% by  1968 and further declined to 15% for the year beginning

              July 1, 1975, (Fiscal Year 1976).11

                   Attached to Mr. Webb's statement is a study.from the Office of Budget

              .Director, December 1968.

                   A question was also raised onparagraph 4 (a). There was some question

              as to whether Delaware was ever a high income/low tax,State. Mr. Hudson, of

              the State Planning Office, has done an analysis of State/local taxes in Delaware

              from 1958-1973, including Stateand local tax revenues.
<pb n="506" />

                                                          5

                    Mr. Biondi, moved that the Chairman of the Cost of Public      Service Committee

               (provided w -ith Mr. Webb's memo and attachments to Mr. Biondi)     meet w,ith his

               Committee to d,iscuss the issues   raised on  B. 1 (c) and 4 (a-).   He fe.It that

               since the Cost of Public Service    Committee has expertise in this area, they

               should be able'to look at these    issues and come back with something to dis-

               tribute to-the Commission. This motion was seconded by Mr. Krapf and.approved

               by all present.,

                    Mr. Biondi gave Mr.   Webbts letter   and.supporting documentation to Mr.

               Kreiger for study by his   Committee.

                    The remainder of   Section B was  agreed to with no comments. Section.-C

               was approved with no comments.

                    In Section Di Mr. Biondi pointed out that-z number      of Commission members

               disagreed with the title of   D.: ."The 'Quality of Lifelin Delaware has declined

               markedly-" The Commission    had agreed to amendthis to read "The economic

               vitality of Delaware has declined markedly"., Mr. Cooperson asked if this

               statement isn't true of the U. S. in general and not just particular to Delaware.

               Mr. Biondi said the point of the first two parts of this report is that, while

               we were growing at faster than twice the national growth rate at one point i.n

               time, we are now growing at the national growth rate -.which has declined sub-

               stantially. So we are talking about a more      serious problem than the.current

               recession. In other words,.if the current      recession were   to end 16 normal

               course and have a normal economlc@recovery,     we would still have this problem

               of growth in Delaware.

                    Mr. Weiner pointed out that Section D answers the question that's been

               raised. Nlot only.does the new title say that the economic vitality in Delaware.

               has declined markedly, but it    points out specifically.where and how: highways,-

               railroads, the city, etc. and none of these infers the recent recession that
<pb n="507" />

                                                       6

               the U. S. Is in.

                    Mr. Biondi brought up an issue rais
                                                        ed by Senator Berndt on page 3, on the

               accuracy of statement (d   "Additional borrowing faces increasin g political

               resistance". He said he thought the Committee.was trying to say that the

               additional borrowing is a cost which we have to pay at some point in time.

               Mr.. Biondi felt that rather than saying "faces increasing political resistance"

               what they were really saying is that additional borrowing will have serious

               long range cost impact on the State. Mr. Weiner felt that this sentence serves

               no purpose. Senator Berndt moved that B.     (d) be stricken from the report.

               Mr. Krapf seconded this motion. Secretary Danlello voted no.     Al I others

               approved.

                    In Section D. 1 reference Is made to  Delaware's highway programs. It   was

               moved and seconded that some mention should be made in this section.of the    fact

               that the passage of the recent bond bill incorporating $42,000,000 in funds,

               for the Highway Department, shows a recognition of this problem. All present

               approved with Secretary Daniello voting no.

                    Secretary Daniello said that motions are being made to change the summary

               without any reference to making any motions to refer to the kind of language

               use - in some cases idential language - in Part I-V of this report. He suggested

               that if the Commission is going to make a motion to strike, delete, or amend

               whatts in the summary, then the Commission should be sure all the policies
               stated in the reports are consistent. Mr. Biondi said that if, at any point

               in time, Secretary Daniello would like to refer a.wri.tten communication to the

               Chairman indicating any conflicts, the Chairman would be  happy to receive it.

                    Section D. 2 was approved with no comment.

                    In Section D. 3 Mr. Dohorty asked what time frame this refers to. Mr.

               Biondi felt that the City of Wilmington has been suffering for quite sometime.
<pb n="508" />

                                                        7

              Mr. Biondi suggested D. 3 be amended   to read "The City of Wilmington suffers.

              from problems similar to those of other urban centers in the U. S.". He asked

              Mr. Dohorty if there.has been any kind of-signficant population in flow back

              into the City which would make D. 3 not correctly-in focus at the present time.

              Mr. Dohorty answered that the Bureau of Census released information saying that

              the population has declined from 80,000 to 74,000, however the City of Wilmington

              disagrees with.these figures.

                   Mr., Weiner noted in D. 3 (a) he felt  that blighted  housing and the crim e

              rate have.been serious problems, and have    not just become problems.. It was

              agreed to amend this sentence to read "Blighted housing and the crime rate are.

              serious problems".. Mr. Weiner felt that the question of the time      frame Is

              important in this issue.
                   Mr., Anderson said. that the statement "there has been a sharp decline in

              the quality-of public schoo1s" (3 (b)) is not compatible with what was said in

              Part IN   which says "expand educational programs to upgrade residents" skills

                                                                 implie s concern with public
              and motivations". Mr. Biondi agreed. that 3 (b)

              schoo.1 buildings,when, in.fact, the concern is   with the educational system

              itself. This phrase should be amended:to read:    "decline in the qua1ity o  f

              publiUc education".

                   Mr. Biondi read  Section.D. 3. to incorporate the suggested amendments.

              This secttion would read as fol1ows:

                   3. The City of: Wilmington suffers from,similar problems to  those of other

                      urban centers- in the U., S. since, 1950.

                      (a) Blighted housing  and the crime,rate are:serious problems.

                      (b) There has  been a sharp decline in the quality of    the public school

                          education  program..

                      (c) There has  been a generaLexodus of residents and business from the

                          City to the'suburbs.
<pb n="509" />

                    There was a great-deal of discussion concerning the     educational system

               in the City - whether or not it has improved recently or     deteriorated. Dr.

               Latham suggested that 3. (b).be stated in a more positive     manner so as to read:

               "The quality of public education needs to be improved".

                    Mr. Oldach felt that the iss  ues all refer to the first paragraph in Part

               I - what are the major post - 1970 developments which have changed the economic

               climate of Delaware. Mr. Biondi said that if the Commission is talking about

               post - 1970 developments, D. 3 would have    to be amended to read:

                    3. The City of Wilmington has continued to suffer from problems similar

                       to those of other urban centers in the U. S.

                       (a) Blighted housing and the crime rate are serious problems.

                       (b) The quality of public education needs to be substantially      improved.

                       (c) There has been a general exodus of residents and business      from the

                           City to the suburbs.

                    It was moved by Mr. Krapf and seconded by Mr. Oldach that D. 3 be adopted

               as amended. This was agreed to    by all present.

                    D. 4 was agreed to with no   comments.

                    Secretary Bryson expressedconcern with Section E. He       felt there was no

               data in E to support the phrase fienvironmental policies" in the title,

                    Mr. Biondi suggested  that  Section E.1 (c) be replaced.with thepolicy

               rewritten in Capital Gains and   agreed.to at the  last meeting. This will read

               as follows: "Alternate sources of revenue must     be judged for their eq  uity and

               effectiveness, including the relative burden of    taxation on manufacturing   and

               business in the State".

                    Mr. Krapf again pointed out his.concern and Secretary Daniello's concern

               about possible,conflicts of policies agreed to by the Commission. Mr. Biondi

               said there are not many points of conflict, and the conflicts will be rectified
<pb n="510" />

                                                       9

              to agree with previously adopted policles.

                   Mr. Anderson asked if In the t itle of E. the word "environmental" could

              be changed to development, because there is no su  bstantiating evidence to

              describe environmental conflicts. Mr. Biondi said that.E. 2 refers to the

              Coastal Zone Act where.Delaware has adopted an anti-industry image as compared

              to its past reputation. It was   decided at the last meeting that it was the

              controversy over the Coastal Zone Act and not the Act itselfthat gave Delaware

              its anti-industry image.

                   Mr. Wel.ner felt that this policy Implies that.government and bus,iness

              leaders are anti-environmental and he,doesn't feel that that is accurate. He

              made a motion that E. be amended to read "Government and busine  ss leaders have

              publicly disagreed on State tax and developmental policies.- This   moflon was

              seconded by Mr. Anderson. Secretary Daniell,b,.commenting on the motion, said,

              as was discussed at the Economic Development.Committee Meeting, that business

              leaders have criticized and  have disagreed with the State's environmental

              policies - the crux of which is the Coastal Zone Act. Mr. Weiner moved that

              instead of singling out government and business leaders that we say: "Leaders

              in government, business, labor and other groups have publicly disagreed on

              State tax and environmental policies". This motion was seconded by.Secretary

              Daniello.
                   Secretary Bryson stated th at if the C'ommittee!s reasoning for inserting

              the phrase "environmental policies" is just on the basis of the controversy

              of the Coastal Zone Act, it is unfair to put all other environmental policies

              in the same category.

                   Secretary Schranck moved Mr. Weiner's motion be amended to read: "Leaders

              in government, business, labor and other groups have publicly   disagreed on

              State tax and some environmental and developmental policies      This motion, as,
<pb n="511" />

              amended,, was seconded by Mr. Krapf and agre ed to by all present.except Mr. Bauer,

              voting no.

                   Moving on to Section 11, Mr. Biondi said these issues address the economic

              strengths on Which Delaware can build. He felt that under    A, 1 and 3  relate to

              Delaware's geographic location, however    2 seOms.to relate  more to a  quality of

              land rather than Its location..

                   Dr. Latham said that in A. 2, the,point being made is that   Delawarels Is

              simply located geographically to a large potential market   for agricultural

              products and that's why it's important to mention agriculture in relation,to

              it's geographic advantage. He said this section ought to be edited to clearly

              talk about the agriculture market.

                   Senator Berndt asked in  A. 1, what waterways are we talking about? Mr.

              Biondi clarified that the Committee-was tal.king about waterways, not for

              development, but as transport corridors.

                   Mr. Thorn suggested that A. 1 be amended to read: "Delaware is,strategically

              located in the New Castle.metropolitan corridorP with favorable waterways for

              transportation and still has a substantial amount of land which could be used

              for future growth. This suggestion.was moved and seconded by Secretary Daniello..

              Mr.-Cooperson questioned the implication of having   a substantial amount of land.

              He felt A. 1 is in conflict with A. 2, Mr. 01dach    answered that this is just

              a list of strengths which, if desirable, could be   used. In other words, the

              Committee listed things that would make,it  possible for economic growthin

              Delaware, if we want to pursue that. Mr..Walton felt that it should be    clearly

              stated these policies will  only be followed  if desired, It appears to  him,

              that the whole State is on the market block.    In a vote on the motion, Mr. Walton,

              Mrs. Slights and Mr. Coopersonvoted no and   the motion was adopted.

                   On Section A. 2, Dr. Latham moved  that  it be amended to read: "Delaware
<pb n="512" />

              has a high level of
                                    land devoted to agriculture; and, with the nation's food

              needs increasing,  the favorable location of   Delaware's agricultural industry

              should permit it  to continue to make a major   contribution to the State's

              economy. This mot   ion was seconded and approved by   all present. M  r. Biondi

              requested that a copy of this section - as amended       be sent to Mr. Walton to

              give him the opportunity to make any comments after he has seen it in writing..

                    It was moved and seconded that Section A.   2 (page 7) be adopted as   written.

              This was agreed to by all present.

                   On Section B,  Dr. Brucker questioned   the automotive statement in B.   1.

              He said  that the national trends indicate   that we may never see the    rate of

              alltomotive production we say in the late   1960's. Secretary.Danielip felt that

              the word "automotive" should not be left    out, as it is one of the three major

              industries in Delaware.
                   Mr. Oldach felt that the'title   of Section B. should be changed to read:

              "The major Industries in Delaware have been In the growth sectors of the economy".

              He said It is statedo In B.,3, that   theremay be some question about the

              automotive industry.

                   Mr. Biondi clarified that   this paragraph states  that the major industries

              in Delaware remain in growth   sectors of the economy. He said    it.doesn't imply

              that we've seen all the growth   we are going to see in any one   of the three

              industries  illustrated and the  only comment made pe rspectively is that the

              11growth will probably continue  to expand at a reasonable rate". There is no

              indication that it will expand   at the rates of the past4 These industries pay

              better than average wages and   the particular problem.of the auto industry is

              pointed out.

                   A moti on was made by  Mr. Krapt and seconded by Mr. Thorn to adopt Section

              11. B. as written. This motion was approved by all present.
<pb n="513" />

                                                      12

                   On Section C, Mr. Biondi noted that the Commission had previously

              exhausted the debate over the specific content of this Section. He said there

              wasn't anything in Sections C, D and E that had not been-previously.debated.

              and.approved by the Commission. Mr. Krapf moved that Section 11.,C, D and E be
              accepted as written. This motion was seconded by Secretary Daniello with a'll

              present voting approval.

                   Mr. Krap f moved that Section 11. A be approved as written. This motion

              was seconded by Secretary Daniello and approved by all present.

                   Mr. Biondi stated that all the questions in III. B were debated at the

              last Commission meeting. Mr. Krapf made a motion that 11. B 1-4 be accepted

              as written. This move was.seconded. Mrs. Smith requested clarification on the

              word growth as used in this section   'does it mean a mixture of economic and

              population growth. Mr. Biondi said that B. I refers to population growth.

              B. 2 and B. 3 also refer to population growth. However B. 4 seems to relate   to

              other problems, such as environment related considerations. All present voted

              to accept Section B as written.

                   In Section Ill. C, Mr. Cooperson moved that we strike the phrase on

              internal population growth, because he feels there is no way the Commission can

              control internal population growth. Mr. Biondi felt that, in terms of the way

              the Committee used internal populat ion growth versus in-migration, they were

              not talking about controlling internal population growth, they were talking

              about whether or not we ought to stimulate a rate of economic growth which

              .Would require net in-migration from people for jobs.

                   Mr. Weiner was concerned with the sense of the entire paragraph. He said

              that he as sumes there will be an end to the Delaware Tomorrow Commission. In

              this report, the Committee has indicated a need to took at new jobs, which

              (Mr. Weiner feels.) is a tangible, feasible task. However, if the Commission
<pb n="514" />

                                                      13

             wants to establish growth  and development goals and specify the amount of new

             businesses desired and set up some specific figures, he suggested that Section

             C is virtually an impossible task. He further stated that.on page 15, of this

             report, the Committee did  an excellent job in taking the-whole question of growth

             and projecting the figure  of the number of jobs In a given period.

                  Mr. Biondi then sugg ested that 111. C  be amended to read: "...the Delaware

             Tomorrow Commission should esta blish job growth goals including such things...".

                  Mr. Oldach explol ned the Committeefs point in.this section  was that we

             haven't analyzed  the economics of whatt,shappened In the.past4   You need.to

             make somesortof analysis to try to relate a cost to various changes. When

             that is done, you  are then in a position to judge  looking forward to some sort

             of program and whether or not the State can affo"rd. it. For example, we don't

             know if the State  can afford to not have any new industries coming into Delaware

             whether the State  could keep up with the expenses.

                  Mr. Weiner's  point was that there are many growth  and development goals

             that can be identified* which would be non-economic in   character.

                  Mr. Walton expressed concern with the phrase "in light of the above.growth

             impact analysis". He said B. 1.6-4 are only questions.   There are no answers.

             He felt that C should state that "when the answers to   B. 1-4 are realized,

             then we will establish job growth  goals". Mr..Biondi   then agreed to strike

                               above growth impact analysis", and start Section C  as follows
             "In  light of the

             "The Delaware Tomorrow   Commission should establish 4ob growth goals Including...
                                                                  J

                  Mr. Weiner again stated that  page 15 gets specific as to goals  and figures

             and that the summary ought not to  be generalized. Mr. Oldach said that the

             .statements on page 15 are not goa Is they are ass-umptions. They have nothing

                                           or what the Commission should "shoot for".
             to db.with what is  desirable
<pb n="515" />

                                                        14

                    It was moved and seconded that Section.C be amended    to read: "The

               Delaware Tomorrow Commission should establish job growth    goals including such

               things as internal population growth vs. in-migration, type and amount of new

               businesses desired, and a forecast of the resulting changes in     State income and

               expenses".
                    Mr. Bauer asked further clarification on the phrase i1such things as

               internal population growth". Mr. Biondi,said that phrase is not addressed in

               isolation, it is discussed in terms of internal population growth vs. in-migration

               should the job development goal be such that you would produce a number of jobs

               in the future.which would not only be sufficient to provide jobs for the growth

               of population within the State but would encourage a number of people from

               outside the State to come into the State for jobs. Mr. Bauer felt that this

               concept was not very clearly stated.

                   The motion was approved by all present.

                   Mr. Biondi felt that Section D was sufficiently qualified and that the

               key words are "some continued growth". Delaware needs     some growth, as a necessity,.

               just to meet the imbalance kind of thing that the Committee attempted to do on

               page 15. Section D is within the context of Part I of the Committeevs report

               pages 13-15.

                    It was moved and  seconded that Section D (not   including 1-11) be adopted

               as written. This was   agreed to by all present.

                    Mr. Biondi said  it was his recollection that the Commission had previously

               voted on D. 1-9 in the  previous Economic Development Committee Report and had

               approved each step.

                    Mr. And erson asked if D. 5 had been adopted, as.written. Mr. Bondi said

               it had been revised and the problem had been dealt with.
<pb n="516" />

                                                      15

                  Mr. Cooperson asked if D.1 s houldn't be modified to say: "It is recommended

             that the Governor and Legislature develop..."'. Mr. Biondi said he thought

             the Committee was implying some more degree of Executive responsibility.

                  Mr. Thorn asked if D. 10  (a) could be amended to.read: "By developing a

             Comprehensive State-wi.de Land Use Plan    Thereby deleting "to remove the

             inequities of the Coastal Zone  Act". Mr. Oldach  felt that the whole point on.

             this action was to deal with the anti-business reputation of Delaware caused

             by the Coastal Zone Act.

                  Mrs. Greer asked if  it was necessary to act on 10 (a) w.ith the resolution

             adopted at the last meeting. It was moved and seconded that the Commission

             substitute for 10 (a) the resolution adopted by the Commission  with respect

             to the Coastal Zone Act'and.the development of a Comprehensive State-wide

             Land,Use Plan. 10 (a) would read as follows:    "The Coastal Zone Act was passed

             in lieu of a more complex Coastal  Zone Act-which was proposed earlier but

             received little support. In reality, both goals are an attempt to begin land

             use,planning. -The Committee has concluded that the time has come to replace

             the initial Coastal Zone Act with a Comprehensive State-wide Land Use Planning

             Act. The present regulation-should be used intact as interim guidelines to

             govern and.develop the coastal zone until the new land use management regulations

             are comp lete and accurate. At that time, the Comprehensive State-wide Land

                                                                       an
             Use Management Plan would supersede the Coastal  Zone Act   d other land use

             control legislation-presently,administered by the State".

                  Mr. Weiner moved that the above be substituted for 10 (a).   This motion'

             was seconded and approved by all present.

                  Mr. Biondi said that 10 (b) and (c) have already been acceded to in the

             body of the report.
<pb n="517" />

                                                          16

                    Mr.  Cooperson said  it was his re Icollection, on the matter of the     coastal

               zone and  State land use planning, that when the Commission.went through the

               Land Use  and Com munity.Development Committee.Report, t-here was also a resolution

               approved  by the Committee dealing with the coastal zone relative to extendi,ng

               the coastal zone protections to other non-industrial uses and that should be

              .considered in this context.

                    Mrs. Slights moved that D. 11 be replaced by (3).on page 32 as amended

               and adopted by this Commission.     This move was seconded and.agreed to by all

               present. D. 11 would read as follows: "The      State should establish a program

               -to participate in the Atlantic offshore drilling for oil% and should study the

               development of  deepwater terminals in such a    way as to maximize the future

               economic benefits while minimizing only    detrimenta_l.impact".

                    This completed the review of the Economic Development Committee Summary.

               The Commission then went on to discuss and review Dr. Latham's working draft

               of 1985 forecasts of revenues and expenditures of major Delaware governments".

               Mr.. Biondi asked Dr. Latham to explain what this..document,is and its concepts.

                    Dr. Latham said that he.felt the most important point in this report Js

               the kinds of assumptions that are drawn up      rather than the.spe.cific.numbers

               that came out. The report is    a result of   th.e Chairman of the Commission's,

               suggestionthat an-attempt be    made to extrapolate past trends in revenues and

               expenditures under@several.possible assumptions and see      what happens in the

               way of revenue and  expenditures for State government     (all the governments.in,

               the State).

                    Dr. Latham distributed copies of    a  paper entitled  'Additional Explanation,

               of Revenue and Expenditure Projection".      This paper explains the-process used

               in the June 30 report in a little more detail. (A copy is       attached).
<pb n="518" />

                                                         17

                    Dr. Latham added  that he  feels the most vali,d way of making proijections

               is to take the kinds of revenues and exp   Ienditures that seem, in the past, to
               have,responded to changes in   population and  project them on a per capita basis

               and take those that have   not responded as strongly to changes in population and

               simply project their totals'and then apply different rates of inflation to

               expenditures and revenues. This total would be similar to projection 10.

                    Dr.. Latham made two caveats  regarding the numbers:

                    1. The population figurehe    used he  picked up  from an earlier draft of

                       the Economic Development.Committee Report and did not reflect the

                       number.which had been a  greed upon by the.Comm  ission of ap  proximately

                       700,000.-  so that would change all the per   capita projections.

                    @2. There were some numerical errors, simply because the people compiling

                       the report  could not believe that an adcumulated growth rate could do,

                       the kinds of things it did. These errors were      corrected to realistic

                       figures by-those compiling the report.
               He said that the 10th projection may be.the most reasonable kind of numbers

               that one could arrive at.

                    Mr. Biondi asked in Table 1, based on 1985-10, what     does this table say.

               Dr. Latham answered.that this table says: if you are willing to make the

               assumption that,  in general,  the rate of Increase in revenues would be about

               5.15% and if you  assume that  some revenues (as shown in' Table [I-'IV) ought

               to be regarded as  per capita  based, while others should not.be regarded as per

               capita base and then  make simple extrapolations of trends    from 1968-1973,

               revenues from 1985 would be $3,*712,000,000.

                    Dr. Latham said that assumed along with all otherfactors.-is that the*

               rate of growth in the amount of taxes people will continue.

                    Dr. Brucker said that, in the revenues, it should be made clear that      Dr.

               Latham did include Delaware, non-tax sourcesi There is avery-large ch.unk      of
<pb n="519" />

               external  funds coming into this projection; i.e., revenue sharing.

                     Mr. Biondi asked Dr. Latham if any of the data compiled in his    report will

               help him answer the four questions on pages 8 and 9 of.the Economic      Development

               Committee report. Dr. Latham said that you need the answers to those questions

               to make therevenue expenditures.
                    Mr. Biondi said he was having difficulty making Dr. Latham's     report relate

               to the issue,of what. kind of rate of job growth the Delaware-Tomorrow Commission

               should support in the State. Mr. Kreiger explained that the Cost of Public

               Servicets, original report illustrated that the total per capita costs were at

               the present rate., approx imately $1,100.per person    residents in the State.

               That figure included revenue sharing monies, outside sources, etci Dr. Latham's

               report attempted to point out that we'll, be spending approximately $5,-,300 per

               person by 1985, which is about five times what welre spending now - assuml.ng

               a population of 700,000 by 19 85. This also assumes that the average continues

               at the same rate for the,next 12   years.

                    Mr. Weiner asked what usefulness are the    figures in Dr. Lathamrs  report.

               He felt that the Commission could do one of two things:.

                    1. Examine each assumptilon and get a  common agreement on the

                       assumptions  and they can go from there, or;

                    2. Give-them some other basis for making those assumptions.

               Mr. Weiner felt that  the Commission is not prepared to gi.ve another basis.

               Therefore, he questioned what the Commissi,on can say as a result of.these    figures..

                   .Dr. Markell noted that Dr.  Latham has shown that,.given any set of projections

               the Commission decides upon, yo u can come up,with numbers., The Commission    has

               to decide on projections in different areas by 1985.

                    Mr. Walton said that we need the answer to the question of: how much did

               this growth that we now have cost us? If the Commission could have an idea

               of what we've spent for what we  have,  we could approach this issue from a more
<pb n="520" />

                                                         19

               intelligent point of view.

                    Dr. Brucker-felt that, rather than    getting tangled up in the expenditure

               side of the problem vs. therevenue side,;the Commission should first address

               reasonable projections of the tax burden on the population to 1985, because

               if.you can't raise the funds, discussing expenditures is meaningless.

                    Mr. Thorn stated that he felt that the figures in Dr. Lathamts report

               serve one purpose and that is the importance of knowing and evaluating the

               benef its and cost ef f ects of whatever.the Commiss  !on eventually recommends.

               Mr. Biondi said that this seemed to    be the general concensus. He said     that the

               major question +he Commission needs    to answer is: What 'rateof growth     should

               Delaware seek to achieve in the next few years. In order to get to those

               questions, the'Commission has to answer the questions that the Economl,c,D.evelop--,

               ment Committee proposed.

                    Dr..Brucker asked it we could go back on the revenue      side of the first cut

               and ask what we see for the State of Delaware In terms of      allocating resources

               from individuals and corporations to the public sector. Answering this question

               would tell us what we have left to work with on the revenue sidei He then

               suggested looking at the expenditure side and do some ad hoc      analysis of what

               the historical expenditure trends hold for the future. The Commission can thei-I

             .See how our reasonable projections of expense compare with our re'asonable

               project of revenue. However, he said, the      first question is': do we want

               the public sector to grow as a percent of the income     ofthe Stat`6.      He'defined

               public sector" as primarily State and local government expenditures           total

               dollars,allocated to services,that are generally supplied by governments within

               the State.

                                                                                   nor the valid
                    Dr. Latham felt that  the easiest approach to take      is to ig

               questions which have been   raised, because we can't answer    them and go ahead
<pb n="521" />

                                                       20

               and  try to make a projection of likely  revenue that can be raised on the

               assumption, for example, that people will or won't be wHling to contribute

               larger portions of their income and,then look at individual expense and see

               which ones could arbitrarily be candidates for cutting down thesize of total

               revenues if it happens that total expenditures are larger than total revenues,

               based on the current projections.

                    .Mr. Chamberlin felt that you cannot accurately  project costs,@ except that

               in 1985 the revenues and expenditures ought to be equal. Flowever,.in examining

               the rate of growth, we can make reasonable projections as to the population

               increases and what is likely to occur in terms of in-migration.     We should also

               make projections about what is likely to happen in an economic context. Both

               of these projections have to be focused toward the quality   of life in Delaware.

                    Dr. Latham said he was not trying to balance revenues   and expenditures.

               What he was trying to determine was the willingness of people to buy government

               services, their willingness to remain constant and what might.happen to expen-

               ditures. Are we going to be able to afford the kind of government services that

               provide the quality of life desired by Delaware residents? If we find     out

               that a reasonable projection of expenditures far exceeds the   expected  willingness

               of people to pay for services provided through the' expendituresi then    Delaware

               won't grow   it won't be an attractive place.

                    A lengthy discussion followed concerning  the difficulty of projecting

               expenditures for the future.

                    Dr. Latham said that Delaware should pay  the bill for whatever rate of

               growth we get and we should try to devise'a general position that imposes the

               cost of the rate of growth on those who are causing it.

                    Mr. Biondi suggested that possibly the Commission ought to make a policy

               decision that states that there is not a great deal to be gained by encouraging
<pb n="522" />

                                                        21

               people to come  here for jobs    look  at the issue from the point of how many

               jobs do we need  to support the natural@growth in the population we expect and

               maintain a quality environment. With this assumption, Delaware will have t(

              .pay the bill for whatever rate'of growth that Is,     and not try to quantify   the

               questions of cost to that rate of growth.

                    Mr. Chamberlin felt that each project varies@ so much that     it can't be de-

               cided how much growth you want in advance.

                    Mr. Weiner said that there is going to have to be a decision-making process

               that sets up some general criteria of what the State wants and not say whether

               it has a cost benefit or negative cost in terms of dollars, but relates to the

               question of how we achieve our goal.

                    Senator Berndt asked Secretary Daniello what he would project his

               Department's expenditures to be over the next ten years, in order to get some

               idea of the increase of the cost of government. Secretary Daniello said,

               assuming the same level of services, he only anticipated approximately 5% a

               year increase.

                    Mr. Chamberlin felt it would be more meaningful     to define  the maximum level

               of unemployment, rather than trying to define avallab    le jobs'in  the State in

               .1985.

                    Mr. Biondi said he didn't   see how this could be accomplished. How

               would@we compare-Delaware's rate of unemployment and what.is an acceptable

               rate?

                    Mr. Kreiger felt that everyone has overlooked the fact that Delaware       seems

               to be living "hand to mouth". and has no surplus whatsoever. If any      sort of

               catastrophe did hit Delaware,,we wouldn't have any reserve money to      fall back

               on.

                    Mr. Biondi felt  that  the.concept of a "publi.c  surplus" was  a mutually

               exclusive idea.
<pb n="523" />

                                                         22

                     Mr. Larson felt that, in trying to think ahead at the cost of government,

               you have  to look at it in terms of the product being delivered and.the quality

               of this product. Once you've set the level of services for quality that you

               want to have to service any situation, youtll be able to put numbers on them.

                     Mr. Biondi said that there is a general recognition by the Delaware Tomorrow

               Commission that the cost of public services in Delaware - in terms of numbers

               of employees, etc.     is high In the sense that,we have jurisdictions that we

               don't need. For example, he said there is no rational basis for the existence

               of the City of Wilmington as a governmental unit.

                     Mr. Morton pointed out that in 1985 approximately two-thirds of Delaware's

               total income will come from sources outside of Delaware. Currently, approximately

               30'/J' of Delaware's income is from outside sources.

                     Mr. Biondi suggested that tee Commission ought to recommend policies,

               eliminate those that are negative in the economic picture and as growth happens,

               make some decisions about what its impact,will be'on all areas        dec ide each

               case on its own merit.

                     Mr. Kreiger suggested that now that the base data are now available, some

               effort be made to construct some sort of model where we could attempt to keep

               rates and costs current for the future.

                     Mr. Biondi asked that.the Commission    look at the question of what kind of

               rate  of growth, if anyis desired. How should      the Commission handle the question

               of a  recommendation in the area of growth and the creation of an environment      for

               growth. Fie said any ideas wi.11 be   discussed at the next meeting.

                     Hr. Biondi said that, at the   last meeting, the Commission approved the

               creation of a State-wide Land Use    Plan, with a comple tion date of May 1, 1976.

               Mr. Keifer, of the State P.1anning   Office, was instructed to report back to the,

               Commission with! n 30 days with a   program for getting the job done by that time.
<pb n="524" />

                                                          23

               The Commission was insistent.that this be a.cooperative venture between agencies

               in the.State government and local government and notbe a "one man show".

               Mr. Keifer held a meeting on-July 9. Representatives from New Castle Count-.,,

               Kent County, Sussex County, Wilmington, Secretary Bryson, Secretary Hall,

               Ms. Morna Hurd, who is responsible for New Castle's 208 Program, Sussex County

               Engineer, who is responsible for Sussex County's 208 Program. Everyone showed

               up either personally or with representatives, except for Wilmington. Mr. Keifer

               said that the group felt that we can tackle the problem. There was some question

               as to how much could really be accomplished by next May, particulary because of

               the wide difference in planning in the three counties. New Castle County is in'

               good shape because their 208 project is a,little over      Ia year old. They are

             .updating their comprehensive-plan. Their basic work should be finished about

               the end of this calendar yeart so that could be input to what the Commission is

               discussing. Kent County is not in as good a position as New Castle County. They

               have an adopted land use plan. Sussex County has just begun their 208 program

               and they are at least a year behind New Castle County.

                    One of the ideas this group came up with was.that perhaps we could come

               up wl th some kind of State-wide plan on or about the first of May with a

               recognition that the level of sophistication of the plan would vary depending

               on where you were in the   State and at the same time-come up with some,kind oil

               mechanism to build in these other programs-and amend the plan accordingly as

               they come on I i ne.

                    The group identified a number    of problems. The   re was a general consensus

               that the Chairman, or someone from the Commission should meet with local officials,

               county commissioners and planning commission members - and brief them on Delaware

               Tomorrow-and  why we're doing this plan      Thereasoning behind this is so that

               the planners.who have   to be involved would have the support of their bosses and

               also so that when we  come out with.-some kind of plan, the local officials know
<pb n="525" />

                                                        24

               what they  are buying into also     since the concept of the plan said it would

               be a cooperative thing, in the implementation.of it.

                     Another issue that was raised was, in terms,of a State-wide plan, are -the

               land  use policies that have been adopted by the.Commission, in fact, the pol.icies

               that  this plan is to be based on? Mr. Biondi said, from the point of view of

               the Commission, yes. That requires     that governmental official  s be convinced

               about the merits of those policies.

                     Mr. Weiner asked tlr. Kelfer.to give.an illustration of a policy adopted

               by the Commission that is in question now relative to its inclusion in a

               State-wide Land Use Plan.

                     Mr. Keifer said there was a whole "litany" of recommendations in the Land

               Use Report on development, transportation and highway policies. He asked, what

               indeed, is the policy framework   for that  State Land Use Plan. Is that policy

               framework for that plan the policies that have already been adopted by this

               Commission.

                     Mr. Weiner said Mr. Keifer discussed somethings in terms of configurations.

               Mr. Weiner wanted to know: what kind of configurations. In other words, when

               the plan is completed, will it show where to build a new town?

                     f-.1r. Keifer said that it was the general view of the planners  present  at

                                 'conceptua
               the meeting thatJ,           Ily we were almost forced to think at the level     of

               the New Castle County District Study.

                     Mr. Biondi said that Mr. Weiner is addressing himself to     questions that,

               at some point, are goin g to be critical. However, he pointed      out that nobody

               present at his meeting told Mr. Keifer to "go to hell". Mr.      Keifer agreed that

               there was a general spirit of cooperation. He said no one present indicated

               they would not be willing to participate'or that it would be an impossible task.
<pb n="526" />

                                                       25

                   Senator Berndt noted that the U. S. Government reserves certain powers

              and says that those powers they don't have belong to the State. He asked if

              De laware is goi ng to 'do-this to-the Sub-units of government within the State.

                   Mr. Keifer said that his understanding of what the Commission adopted

              last week was for them to come up with some kind of plan that-would incorporate

              the land use planning, that is traditionally the responsibility of the local

              governments, with the "quasi" land use planning done by the State government,

              particularly through'Secretary Bryson's regulatory programs, along with the

              capital investments and related sorts of things that the State government

              traditionally does.that has an influence on   land devel.opment, come up with a

              plan that incorporates all of. those and some  implementation process that would

              orchestrate the implementation of all those regulations and laws by the levels

              of government that currently administer them. No one unit of government could

              unilaterally make a decision that would upset the plan. There would be no

              coersion and the "turf" would not change substantivel.y from the way it is now.

              No one unit of government.could unilaterally change the plan or make a decision

              in violation of the plan. The pl.an would probably be changed annually through

              some monitoring process. Mr. Keifer said this was his view of what the

              Commission was asking them to do.

                   Mr. Keifer also noted that the feeling at the meeting was that there were

              other governments who should have been invited but were   not   Newark., Dover and

              possibly some others. Mr. Biondi suggested that the members of the Delaware

              Tomorrow Technical Advisory Committee  might be a good bas.is of, people who should

              be involved in this plan.

                  Mr. Biondi noted that the time frame (May 1, 1976) seemed    to be more

              acceptable in New Cast le County than in the lower two countiesi Mr. Keifer

              said this was true mainly because  of the status of certain projects that are

              already underway.,
<pb n="527" />

                                                        26

                    Mr. Weiner sa,i.d he does not understand the nature of the kind of plan

               they are talking-about. He said that what he feels the Commission is looking

               for  is the broad policy outlined in a State-wide plan, which would help us to

               deal with very broad issues not the definite deci-sions which were to be left

               to the local juris dictions. If they sald'that it will be,, infact, a broad

               brushed overall approach to the planV then Mr. Weiner could understand it.

               If that is not what this group meant, then he can see that they will have

               difficulty getting the plan adopted   by May - or getting  it before us by May..

                    Secretary Bryson explained that   we have,some court  suits pending right

               now that are going to decide  quite a  bit on what is.put  into the State-wide,

               Land Use Plan concepts. One   of them  is on water allocation.

                    Mr. Biondi read the resolution adopted at the last meeting relative to the

               development of the State-wide Land Use Plan. He said that was the general

               principal agreed upon, however, he felt it would take a while to figure out the

               specifics of what the Commission really wants.

                    Mr. Larson said that if this group is going to do nothing morethan make

               a composite of district-type plans, then it's not worth the time.

                    In terms of financing this venture, Mr. Keifer said their assignment was

               to come up with something by the end of this.month in terms of,how they will

               accomplish this task.

                    Mr. Biondi saidthere was an open issue,    raised by  Mrs. Slights, that  the

               Commission never considered that.was in the,Land Use and    Community Development

               Addendum of May 15, 1975, was a sentence that reads: "The'Committee further

               agrees interim legislation dealing with lightering, aquifer recharge and.

               tributaries, should be considered immediately". Mir. Biondi said he thought

               we knew what the lightering legislation is all about - the regul   ation of

               lightering as it presently takes place in the   Bay. Thereis some disagreement
<pb n="528" />

                                                         27

              as to who ought to do   the regulating. However, Mr. Biondi said he wasnit

              sure what was meant-by legislation dealing with aquifer recharge and

              tributaries.

                    Mrs. Slights said   her understanding,of this,statem.ent was    the concern

              in the Engineer's Report that aquifer recharge      and tributaries   be designated as

              are as of critical concern.

                    Mr. Biondi felt this was part of the Lan'd    Use Plan and would,be covered

              in the planning area. This statement does not       require legislation.

                    Mr. Weiner felt that the interim I   egi  slati on dealing with lightering does

              call for some action, because it may pose some threat to the environment.@-On

              the issue of aquifer recharge in the tributaries, he felt we should        wait   until

              we get a,n overall State plan and see what is of critical.concern and       what is

              not, because the present knowledge of aquifer recharge is poor and this is one

              of the things that should be addressed.

                    Mr. Weiner asked if we need interim legislation on lighterlng?@ Secretary

              Bryson said hot necessarily, however that,doesn't mean we shouldn't have some

              control in the future.

                    Mr. Weiner movedthat that sentence in the Addendum be strlcken@ He moved

              that  the Commission not support taking positive action supporting that

              recommendati on. Mrs. Slights said she would support Mr. Weiner's motion          with

              the under-standing that the aquifer recharge and-the tributaries will be        dealt

              with and that we are not, by striking this paragraph, striking the idea.

                    Mr. Biondi agreed to state that    this subject will be dealt with     in the

              context of  the plan.

                    In closing, Mr.  Biondi  delegated  the following tasks   to be accomplished

              prior to the next meeting of    the Commission:

                    1. Mr. Oldach was asked   to take the responsibility of    calling a meeting,
<pb n="529" />

                                                       28

                       of the Economic Development Committee on the issue of separating the

                       concept of population growth and economic growth, as stated in 1. A

                       of the Summary.

                    2. 114r. Krieger was instructed to call a meeting of the Cost of Public

                       Services Committee to discuss the letter and attachment from Mr. Webb

                       to Mr. Biondi, dealing with 1.  B of the Economic Development Summary.

                       .(The meeting was scheduled for Monday, July 14). Mr. Biondi further

                       requested that this Committee  discuss the four questions raised by

                       the Economic Development Committee on pages 8 and 9 under Ill. B

                       1-4. and report back to th e Commission with an idea on  what data  is

                       available.

                    3. Mr. Biondi asked that the entire Commission give   some thought as to  how

                       the Com6ission should state their approach to the   question of growth.

                    Mr. Gilliam asked if anyone has looked  at how otheristates have handled

              projections in the area of growth? Mr. Keifer said that they     all have projections

              of some sort, however, he was not sure how they handled the government finance

              part. He agreed to check further Into this matter     and see.how other Commisslions

              similar to Delaware Tomorrow have approached these    questions.

                    The next meeting of the Commission has been scheduled for Wednesday,,

              July 23, 1975, 4:00 p.m., at Wilton Community Center.

                                                       Respectfully submitted,

                                                       Dee Burkley
<pb n="530" />

                                           I ...........

                                     STATE OF DELAWARE
     DAVID R. KEIFER                   PLANNING OFFICE                   PHONE: (301) 678-4271
        DIRECTOR                           DOVER
            Ref: 10,07/1404                               July.29, 1975

                                DELAWARE TOMORROW COMMISSION
                          MINUTES,OF MEETING OF JULY 23, 1975

                      A meeting of the D  elaware, Tomorrow Commission was,

            held on Wednesday, July 23, 1975,..at the   Wilton Community  Center.

            The following  members were present:

                      Mr.  0. Francis Biondi.,,Esquire
                      Mr.  David R. Keifer
                      Mr.  Frederick.G. KrApf, Jr.
                      Mr.  Carl S. Oldach
                      Mr.'Jay N. Cooperson
                      Mr. Leon N. Weiner
                      Mr.  Joseph Golden
                      Ms.  Dorothy Gre 'er
                      Ms..Joann D. Slights
                      Ms. Marcie Bierlein
                      Mr. Ross E. Anderson, Jr.
                      Secretary John D.   Daniel'lo
                      Mr. Richard Bauer   (voting proxy for Mel Slawik)

            Also present:

                      Mr.* Nick Fisfis
                      Dr.  William Markell
                      Dr.  William R. Latham, III
                      Mr.  Spencer Thompson
                      Mr.  Arthur H. Krieger
                      Ms.  Peg McClane
                      Ms.  Jane B. Aughey
                      Mr.  Bernard Dworsky
                      Ms.  Merna Hurd
                      Mr.  Steve Chamberlin
                      Mr.  William Bradford

                      Chairman Biondi called the meeting to order at 4:30P.M.

            He read an excerpt from the minutes of the July 10 meeting,     in

            which he delegated several assignments to be accomplished prior

                                                    EXECUTIVE DEPARTMENT    W
                                                       SHERMAN W. TRIBBIYT
                                                               GOVERNOR DELAMRE
<pb n="531" />

                                       -2

             tothe next Commission meeting. These are as follows:

             1. "Mr. Oldach was asked.to take the responsibility of     calling

             a meeting of the-Economic Development Committee on the     issue of

             separating the concept of population growth and economic growth,

             as stated in I.Aof the summary.?'

             In response to this request, Mr. Oldach notedthathe had        spoken

             to Mr. Thompson and several members    of the Economic Development

             Committee and it was agreed   that in  the use-of the word "growth"

             in this report, they were referring    to population and   employment

             growth.only. He noted the following changes to the report to

             clarify this,issue.,

             Page 1, IA. The high rate of population and employment growth

                           in Delaware  .........

             Page 8, IIIA  (a) that.the State can obtain general agreement on

                           goals for populat.ion,and employment growth;,

             Page 8,IIIB   In order to establish a reasonable goal for future

                           populationand employment growth rate

             Page 9,1 IIB3 Will future p opulation growth in the State cost,....

             Page 9,IIIC   The Delaware Tomorrow,Commission shouldlestablish

                           population and employment.growth goals   ...........

             Page 9,IIID.  ....the Economic Development Committ   .ee believes some

                           continued employment growth within the State     ........

             Page 13,
             Part I        Change in Delaware's  Rate-of Population and-Employ-

                           ment Growth

             Page 13
             Part I,       Between 1950 and 1970 Delaware   experienced one of the
<pb n="532" />

                                           -3-

                           fastest population growths    .........
             Mr. Oldach said he felt the rest of the report was self explana-

             tory. Mr. Biondi said.that, from the Chairman"s point of view,

             these amendments clarify the intent of this report.

                        Mr. Biondi asked Mr. Weiner if these amendments answered

             the questions he raised the last Commission meeting. Mr.. Weiner

             said his questions were answered    and that using the word "employ-

             ment" rather than "economic" pinpoints.further the issue being

             addressed.,

                        A motion was  made and seconded   that the amendments to

                                                                    -Mr Oldach
             the-,Ec;onomic Development Committee Report   cited by

             be adopted by the Commission. This was agreed to       by all present.

                        Mr. Weiner asked  for clarification of paragraph C on

             page 9, the phrase  ...... such things as  internal population growth

             vs in-migration  .......  Mr. Biondi said   that, at the last meeting

             it was stated that the phrase "internal     population growth" was

             meant as a. contrast to "in-m igration" and there were no policies

            .being recommended with respect to the internal population growth.

             Mr. Bradford suggested substituting    the word "considering" for

             "including" so as  to read        goals considering   such things as

                        It.was moved and seconded that    Section  III C be amended

             to read:    The Delaware Tomorrow Commission should establish popu-

             lation and  employment  growth goals considering such things as in-

             ternal population growth vs..,in-migrat,ion, type and amount of new

             businesses desired, and a forecast of the resulting changes in
             State income and'expenses.
<pb n="533" />

                                           -4-

                       Mr. Biondi said that the minutes'from the July 10

            meeting further state:

                       2. Mr.-Krieger was   instructed to call a meeting  of the

            Cost of Public Services Committee to discuss the letter and    attach-

            ment from Mr. Webb to Mr. Biondi,.dealing with I.B of the D    Summary.

            Mr. Biondi further requested thatthis Committee discuss the 4

            questions. raised by the Economic Development Committee on pages 8

            and 9 under  III.B.*1-4 and report.back to the Commission with an
            idea on what  datals available.".

                       Mr. Biondi asked Mr. Krieger if  his  Committee had, indeed,

            met and discussed the changes which had been    suggested by Mr. Webb

            in the report  of the Economic Development  Committee  on'Page2 and
            3.  Mr. Biondi  said it was -suggested that I B.  be changed'to read:

            "Delawarels tax  situation changed."
                       Mr. Webb also suggested that   B. 1. be changed"to read:
            "Public bor'rowing'to'finance therapid   expansion of government

            services expanded rapidly." He'further suggested'that I. C. be
            changed to read:.." the cost of past long term borrowing (debt
            service for  interest and principal  repayment) has increased in
            dollars significantly. However, as    a'percentage of annual'total
            General Fund  Disbursements, it peaked in 196l.at 20%., declined to

            18.1% by 1968 and further  declined to 15% for the year beginning

            July 1, 1975  (FY 76)."

                       Mr. Krieger said that the Cost of  Public Services Committee
            met on'Monday,  July 14. He saidthere were    two attitudes towards

            Mr. Webb's letter:

                       1. Some Committee members felt that the wording    of
<pb n="534" />

                                      -5-

             Mr. Webb's letter be   adopted as suggested.

                        2. Others   felt that they might object to   the sug-

             gested revisions.

             Mr. Krieger noted that Cost of Public-Services Committee members

             generally resented several remarks and the    tone of Mr. Webb's

             letter.

                        Mr. Biondi said this, letter rep resents oneman's   view

             and certainly  not the view of the entire Commission.

                        Mr. Krieger said that the viewpoint of@the    Cost of

             Public Services Committee was that they would not object     to the

             changes suggested by Mr'... Webb. Mr. Biondi said he was particular-

             ,ly concerned about stating correctly whatever
                                                              the cost of,debt

             service,is in the State. He said we areborrowing more money than

             we have ever borrowed before in interest expenses. Apparently,

             however, the size of the State budget is growing faster     than those

             interest.expenses and if you are going to talkabout it      in terms

             of a percentage of the State budget, itis not     rising in  terms of

             the State Budget    that was not technically correct.

                       Mr. Bradford said that, in connection with     the attach-

             ment "Debt Service Percent of General Fund Disbursements", the

             bonded debt column is outstanding.. He said figures-that     the Cost

             of Public Services Committee have been using is outstanding plus

             authorized. Therefore, these figures,.while      they-are not involved

             in the co-mputations that are made as debt service, are    nevertheless

             misleading in that there have already been bond authorizati    on bills

             passed, which if issued, would be in excess of this amount. The

             point Mr. Bradford expressed was that, if the figures in the report
<pb n="535" />

                                             -6-

             on Bonded Indebtedness are  ever to be used, he thinks they

             will be in conflict with the figures shown in the Cost of

             Public Services report.

                       Mr. Biondi noted that in B.I (c), the comment "It

             now amounts to over 10% of the State.'_s budget and is rising", is

             simply incorrect. In fact, in 1973 it amounted to 14.8% of

            ,.the State budget, but because of the tremendous increases which

             are tak ing place in the State budget, as a percentage of General

             Fund disbursement, it is decreasing. Therefore, Mr. Biondi

             said that this statement is incorrect and should be eliminated

             from the report. He said we then get to the substantive question,

             of what framework should the cost past borrowing be addressed in-

             should it be related to th e State Budget, per capita, or other

             crit eria. He suggested-that.the last sentence in B.I. (c) be

             eliminated.

                       Mr. Anderson suggested that  B.I. (c) be amended to

             read: "The cost of State borrowing (debt service for interest

             and amortization) has caused a significant increase in current

             revenue requirements."
                       Mr. Biondi suggested the following revisions to Section

             I.B:

                       B. Delaware's  tax position has changed.

                           1.  Public borrowing to finance the rapid expansion

                               of government services has expanded rapidly.

                               a) same

                               b),. s ame

                               c) The cost of State borrowing (debt service
<pb n="536" />

                                           -7-

                            for interest and amortization) has caused a

                            significant increase in current revenuerequire-

                            ments.

                        Mr. Weiner questioned the term "fiscal acceptability."

              Mr. Webb noted that the absolute ceiling on the amount of money

              th at can be authorized, under capital programs, is 2.8 times the

              revenue for the preceding 12 mon th period. The source of that

              limit is an act by the General Assembly. Mr. Webb said that this

              may be some thing the Commission would like to comment on.. The

              ceiling for this FY was $1,043,000,000 - that is the statuatory

              limit. Mr. W  einer pointed out that we. have a bonded indebtedness
              of about $,500,000,000 - less than 50% of the statuatory maximum.
              He stated that he questioned the.question of fiscal acceptability.

                        Mr. Webb said that one of the three criteria for a

              government to be in fiscally responsible condition, as.far as its

              operating budget is concerned, is that its debt service cost is

              not to exceed 18% of operating revenue. Delaware was in exces7,    of

              a reasonable, fiscally sound  level, from the period 1960-19.65.

                        Mr. Weiner said that the Delaware Tomorrow    Commission

              Report will be read by Industries, employers, and.the   public - some

              looking to settle in Delaware and make this their home. If we

              say that our public  borrowing has approached the upper limits of

              fiscal responsibility    we have done,a disservice.

                        Mr. Biondi then suggested that B.I. (c),be amended to

              read: "The cost of past borrowing (debt se  rvice for interest and

              amortization) has caused,a significant increas.e in current revenue

              requirements although  it has declined-as a percentage of general
<pb n="537" />

                                       -8-

             fund disbursements since 1961.

                      Mr. Thompson pointed out-several things  he noticed

             when he wrote the Economic Development summary.   The per capita

             debt, just from 1968 to 1973, State and local, has gone up from

            $57 to $78. The   debt increase, in the last 20 years in Delaware,

             has been so rapid that Delaware can't sustain that sort of in-

             crease in.the next 20 years. He agreed to accept B. I. (c) as

             amended by Mr. Anderson, however,.he felt the Commission should

             recognize that there is a problem that we have.financed a lotof
             the growth,in the last 25 years with the rapid expansion of our
             debt- we can't continue this in the next 20 years without being

             irresponsible.

                       Mr. Oldach said that part of the thought that was behind

             Section B is that the fiscal crisis in Delaware has been a cause

             for concern with industry. These fiscal crisis were the result

             of the cost going up rapidly and a scramble to try to raise the

             money to pay it. He said it   might be helpful to add a Section B.I.

             (d) which states: "Some of these increases have.been reflected in

             fiscal crisis which have been a concern to industrial management."

                       Mr. Biondi said that there were some decisions made

             during the period 1968-1972 where the State took over the obliga-

             tion of the County with respect to some important services. That

             was a shift from a local to a State base of those expenditures..

             Because the State had to pay for those, to pinp oint the years

             in which that took place as the years around which the State's.

             attractive.low tax position  came to an end, is an oversimplifica-

             tion of the problem. Mr.  Biondi said that is why he would like
<pb n="538" />

             to delete any reference to a specific year.

                        Mr. Anderson then suggested Section B be amended to

             read: "Delaware's tax position has changed in recent years.11

                       'Mr. Weiner felt  that the point needs to be made that we

             are concerned about economy in taxation, effective, fair taxation,

             etc; however, he thinks that if we are trying to make the point

             that something has happened in recent years, that puts us at a

             disadvantage with other States - that we were wrong. He feels

            ,that weneed some adjustment in the way we are doing -,the internal

             tax raising- but not the totals.

                       Mr..Thompson.explained   the Committee  in writing this

             Summary was trying to look at the   20 year period to see the kinds

             of changes that have taken place over that period and then try to

             look ahead to the next 10 years to see, if those trends continued,

             what the impact would be. The Economic Development Committee's

             impression was that Delaware's relative tax per capita has gone up

             over that 20 year period more than just would be indicated by the

             amounts that are seen when   you look at 1960-1973. He further pr)int-

             ed out that theCommittee was concerned    with the thrust of the caxes

             that had taken place in  recent  years in  terms oflits impact in
             bringing new industry-into the   State. He said that is why    the date

             1970 was chosen- because of the thrust of the recent taxes in     terms

             of the impact it had on the industrial community-

                       Mr. Weiner agreed that.the thrust and direction of the

             taxation that we have needs to be re-examined to make it a more pro-

             gressive, rather than a regressive tax policy, however, he would not

             like to see the generalization that Delaware has gone downhill with

             regard to other States.
<pb n="539" />

                                      _10-

                         Mr. Biondi suggested looking at Section B from another

              frame of reference, changing it to read: "The fiscal burden of

              State Services has increased substantially in recent     years." The

              reasons for this are spelled out in B. 1-4.

                         It was moved and seconded that Section B be amended to

              read: "The fisca 1 burden of State services has    increased substanti-

              cally in recent years." This motion was approved by all present.

                         Mr. Anderson moved, that B.I. be amended to read: "Public

              borrowing to*finance govern  ment services has expanded rapidly."

              This motion was seconded   and approved.by all present.

                         'Mr. Anderson moved that B. I. (c) be changed to read:

              "The cost of State borrowing   (debt service for interest and amortiza-

              tion) has caused a significant increase in current revenue require-

              ments." This motion was seconded and agreed to by all present.

                         Mr. Biondi suggested that a Section B.I.(d) be inserted

              so as to read: "One of the'causes for the expansion of public borrow-

              ing has been the assumptions by the State, of services which were

              previously funded on a local basis." Mr. Thompson felt this was

              not a large enough issue to be put in writing.

                         The original Section B.I.(d), which read, "Additional

              borrowing  faces increasing political resistance," was del    eted from

              this report at a previous Commission meeting.

                         Mr. Oldach suggested adding an Item B.I.(d), which would

              read: "Fiscal crises have occured recently partly     as a result of

              the State assuming local service costs., which has    been a concern

              to industry." He felt that the recognition that       the crises caused

              concern is just as important as whether we are fiscally responsible

              or not.
<pb n="540" />

                       Mr. Biondi said that he felt that the public's defini-

           .-tion of a "fiscal crisis" is a little unrealis.tic.. He said.that

             everytime we have to raise  taxes it is labeled as a fiscal crisis.

             He said that the fact is that Delaware has been able to pay    our

             bills without dramatic changes in the tax structure, either in

             the form of tax or the rate  of tax--with one exception--the income

             tax rate.

                       Mr. Biondi clarified the point Mr. Oldach was making.

             He said we don't have a sales tax in the. State at the present time;
                        a State
             we don't haveAtax on real property; however, if each year there

             is a "fiscal crisis." and if there is a.history of this, industry,

             although they may be satisfiedwith the present tax posture, does

             not know what will happen n ext.

                       Mr. Webb suggested that  B.2 be amended so as to read:
                      "2. In line with proper  fiscal practice, deferred expenses

             must be met out of current revenue.

                          a)   The cost of pensions for State Employees has risen

                               from 3% of payroll in 1950 to 18% of total gen,:@ral

                               fund payroll in FY 76 (partly to cover unfunded
                               past service liabilities in e xces,s of $200,000,000

                               over a forty year period beginning with FY 76.)

                       Mr. Biondi said he would not@agree with the first part    of

             this, because we  are trying to describe the problem. Mr. Webb is
             saying that in line. with-proper fiscal practices incurred expenses
             must be met on 'current revenue. The thrust of Mr.- Thompson's state-
             ment is that we did not., in the past,  make allowance for these expen
             ses. They were deferred and they must now be met out.of current

             revenue.
<pb n="541" />

                                     -12-

                         Itwas moved and seconded to   leave B.2 as written

              so as to read: "Deferred expenses must   now be met out of current

              revenue," and to amend B.2 (a) as suggested by Mr. Webb, so.as.

              to read: "The cost of pensions for state employees has risen from

              3% of payroll  in 1950 to 18% of total General Fund payroll in FY

              1976 ( partly  to cover unfunded past service liabilities in excess
              of $200,000,000 over a forty-year period.beginning with FY 1976.)

                        This,motion was agreed to by all present.

                        It  was agreed to accept B.2 (b)  as written.

                        On  Section B.3, Mr. Biondi asked if there has  been an

              impact on  the capital budget of the State,by the State  taking over

              these other servlices. If so, it ought to be stated here. Mr.

              Keifer said the impact has not been significant. Therefore, every-

              one present agreed to accept BA as written.

                       .Mr. Biondi felt that in Section B.4 there was some

              problem with the date 1970.. Mr. Webb felt that 1969 would be more

              accurate, as that was the first of a series of tax packages. The

              pointbeing made is that the thrust is that the taxati   on mix has

              increased substantially.

                        It was moved and seconded that B.4  be  amended to read:

              "Since 1969, individual income and capital gains tax rates have

              been increased substantially." This mot  ion was-approved by all

              present.

                        On Section B.4.(a) Mr. Biondi noted that we have not

              lost our total competitive advantage over other States with respect

              to location and other things. Therefore,   he suggested amending

              4 .(a) to read: "Delaware has lost a competitive advantage.over
<pb n="542" />

                                          -13-

             other stdtes.',' It was moved,and seconded that this suggestion
             be adopted. This motion was agreed to unanimously.

                       In B.4.(b), Mr. Biondi.felt that instead of talking

             .about revenues, we should be talking about levies.

                       Mr. Weiner noted that on a per capita income basis,

             Delaware is, today, better than we were in 1960. Mr. Weiner then

             suggested striking the word "now" from B.4--(b).

                       Mr. Thompson said that Delaware's rank for State and

             local taxes on a $1,000 per capita income for 1958-1959, we rank-
             ed 50th. Now Delaware ranks 35th, so our relative position     has

             declined in the last 15 years.

                       Mr. Biondi said that  the whole purpose of  saying.that

             Delaware is now about average is to indicate that we  cannot go

             around selling Delaware as a nice, low,tax State to  come to.

                        Mr. Weiner expressed concern that the Delaware Tomorrow

             Commission Report address all income  brackets - not only those in

             high income tax brackets that have capital gains concerns.

                       Mr. Krapf moved,that BA (b) be amende  d to state that
                     has
             "'DelawareAgone from alState that hadthe best, to relatively g,-)od,
             to 35th." Mr. Bradford po  inted out that those figures are not

             based on per $1,000--there is a difference..

                       Mr. Biondi moved that Section B.4.(b) be amended so as
             to read: "It's total State and local tax revenues, on a per $1,000

             of income,have increased so that we are now above average for all

             States, whereas. we were the leader.

                       Mr. Thompson felt that the issue was getting lost. He
             said that the average is $1.20 and Delaware is,$115. Back in 19.58
             the average was $85 and Delaware was $55...Mr. Biondi agreed and
<pb n="543" />

                                      -14-

            Moved that B.4.(b) be  amended to read: "Total State and..

            localtax revenues on a  per capita income basis, are  about average

            for all States, whereas 10 years ago we were the leader." This

            motion was seconded by Mr. Keifer and agreed to by all present.

                        The Commission went on to discuss the 4 questions raised

            in the Conclusion on Pages 8 and 9. The Cost of Public Service

            Committee was asked, at the last C.ommission meeting, to look at

            the 4 questions raised, in the context of what data is available

            and what can be  said in response to those questions. The four

            questions areas  follows:

                       1.  How much of thepresent debt and, the related debt

                           service was incurred to finance the post-war growth

                           in the State?

                       2.  Are there latent costs of that growth which  have not

                           yet appeared in the current expense budget of the

                           State, such as, some of the cost needed to  bring

                           Delaware's highway system up to-date or to   expand

                           hospitals and prisons?.

                       3.  Will futu re population growth in the State cost relat-

                           ively more in relation  to per capita income than the

                           cost of our recent growth? Could the   cost.of this

                           growth be minimized by effective planning?.

                       4.  What would be the relative benefits and liabilities

                           of bringing in to Delaware   and into different locations

                           within Delaware) different types of businesses with

                           their varying service requirements, job requirements,

                           income contributions,  environmental impact and related

                           considerations?
<pb n="544" />

                                       -15-

             In this regard, two separate reports were prepared; one by
             the Delaware State Planning Office staff and the other by

             Mr. Arthur Krieger and his staff.

                       Mr. Biondi first discussed the Delaware State Planning

             Office report entitled:."Operating and Capital Cost Projections

             ,Delaware State and Local Governments 1973-1985." This report

             was distributed to everyone present.

                       Mr.' Keifer explained that the Cost of Public Services.

             Committee met on Monday, July 14, discus,sed the issue and did not

             resolve the issue.then. Mr. Krieger, Dr.Latham., Mr. Keifer, and

             s,ome Delaware State-,@Ianning Offi.ce,staff;members met again on

             Wednesday, July 16 to try to come to grips with some of the ques-

                     This paper was produced as an attempt to get at the problem

             freely admitting that this does not totally answer thequestions.

                       Mr. Keifer went through each Table, explaining them

             briefly, starting with-Table V.I (6). He said that they.felt the

             thrust of the questions raised by the Economic Development Committee

             were (1) can we afford the kinds of growth that we think seem like-

             ly, or (2) willthat   level of growth present some undue;burden on

             the taxpayers of the State, in terms of  financing. They assumed

             a population of,700,000 in 1985., which has been more or less agreed

             to. They used 1973 as the base year because that was the last     year

             they had in the original Co st of Public Services report. They,

             very simplist ically, assumed that the per capita operating costs,

             for 1973, would remain constant til 1985. They ran those out based
<pb n="545" />

                                     -16-

             on multiplying them all by 700,000 to obtain  the operati ng

             costs, in terms of Table VI. That is the categories beginning

             with Education down through General Control plus All Other

             (operations). There was some data on Pensions in the Cost of

             Public Services Committee Report. Based on that data, they
             assumed that,$35.4 per capita in 1973 would remain constant.

             That is how they came up with the second column  of Table VI.  On

             debt service, they went-through an analysis, that actually makes

             up the first 5 tables of this report, getting an overview of

             what the exis ting debt of the State go vernment is. They calculat-

             ed and analyzed the existing debt of the government. They made
             some. judgements as to what the likely capital improvements of the
             state government would beessentidlly by agency, to service a

             population level of about 700,000. They.attempted to gather data
             from New Castle County and the' City of,Wilmington on their 'exist-

             ing debt and their capital improvements plans.   They obtained some

             data from Wilmington, however, they were unable to obtain any data

             from New Castle County so they made some  assumptions to cover that.
             They then forecasted out what amounts.to  a capital program. The

             bottom line worked out to be 40 million  dollars for the State and

             15 million dollars for all locals combined. They held that constant

             in 1973, ran-out the debt service on that-assuming 20 years general

             obligation bonds at 6% interest; calculated the debt service to pay.

             that off, added on the retirement shcedules for all of the existing

             debt, and came up with the debt service numbers in column 2 of

             Table VI. Then, in order to get these figures into 1985 dollars,

             they applied 8% compounded to the 1973 numbers in column 2 to come
<pb n="546" />

                                       -17-

             up with the 1985 numbers in 1985 dollars in the third column.

                       Mr. Keifer explained that they did not address reven--

             ues in this report. However, the expenditures.levels in this

             report, are not too far off from the projections that Dr. Latham

             did in his report on "Revenue and Expenditure Projections" (dis-

             tributed at a previous Commission meeting), where he made certain

             assump,tions.about'the growth in revenues. Dr. Latham's assump-

             tion of about 5% a year fro inflation comes ou   t to be not too

             far off from their expenditure projections.

                       Mr. Keifer said that the bottom line on all of this is

             that, if the Commission decides to accept their,assumptions, then

             the expenditure side is not unreasonable given the projections of

             revenues.

                       This report was discussed briefly prior to the Commission

             meeting, with some of the members. The Cost of Public Service

             Committee and Mr. Keifer felt they had general consensus on the,

             procedures used and assumptions made.,

                       Mr. Keifer noted that these projections were based on

             the assumpt ion of no change in the level of service per capita,

             no changes in programs.

                       In order to reflect the change    in populatlionfrom 500,000
             to 700,000 they multiplied 700,00.0   times the 1973 per capita expend-

             itures. Then to get from the 2nd column     which was in 73 dollars

             to Column 3 in 1985 dollars, they ran an    8% compounded.

                       Mr. Krapf noted that the only thing that can be argued

             is if they used the correct percentage (rate of inflation) number.

             Mr. Keifer said that is why they listed 1973 dollars as well as
<pb n="547" />

             1985 dollars and tried to keep everything as simple as possible.

                       Mr. Keifer said this table als'o says there is no penalty

             for growth, up to 700,000 accepting their assumptions on the

             Capital facilities    $40,000,000 per year). This report   says

             that this is probably fairly close to what is needed on an.annual

             average basis, if the population increase is located in accordance

             with the policies already advocated and adopted by the Delaware

             Tomorrow Commission.

                       Mr.Weiner  expressed concern that the total  figure in

             column 3 of Table VI  might be distorted, since without comparable

             salary figures, it appears frighteningly large. (to the average

             citizen).

                       Mr., Webb said that historically general fund revenue

             increases are between 7% and 8% a year, so between now and 1985

             we are looking at about $900,000,000 in revenue, even with no

             increases in taxes.

                       Mr. Biondi asked if this Table says that the Commission

             can safely recommend a growth policy at the level of 70.0,000 over
             the next 10 years - that the State can afford it? Mr. Keifer says

             that is about what they are saying.

                       Mr. Thompson said that, as he understands the Table

             and Mr. Keifer's explanation, they have said.that t  hey really can

             not answer the questions. Mr. Biondi said   that perhaps, then, the

             questions should be stricken.
<pb n="548" />

                                       _19-

                      Mr. Thompson said if they cannot answer the question,

            we ought to recognize that we  are going forth a little blind on

            this issue. We don't know how much of the present debt and related

            debt service was incurred to finance the post war growth.

                      .Dr. Latham felt that the point this report makes is that

            the response has been such that enough physical capital has been

            provided so that a nother 100,000 people can be handled without undue

            pressure on the budget.

                      Mr. Biondi no ted that they were saying that the  principal

            expenditures are for highways and sewers and that they are current-

            ly under construction or in the planning stages and have the capacity

            of in excess of 700,000 people. There. will be relatively zero

            demand for new school construction.

                      Mr. Webb pointed out that these projections were not look-

            ed at programmatically. Mr. Keifer said that was impossible to do

            in one week. Mr. Weiner said that the Planning Office had done "a

            hell of a job." considering the time constraints.

                      Mr. Bradford said that we have only half the data requir-

            ed to support the assumptions. He suggested that similar data be

            compiled for revenues in addition to  expenditures..

                      On the question of whether  or not the four questions

            raised in the Commission Report should be stricken, since they

            can't be answered. Mr. Keifer said that in light of the Statewide

            Land use planning exercise agreed to by the Commission, to be com-

            pleted by May 1, he felt that by then they should be able to produce

            answ ers to these 4 questions. He felt that they are valid questions

            and should be answered.

                      Mr. Weiner wanted to know what was  the punpose of answer-
<pb n="549" />

                                         -20-

             ing the questions.

                       Mr. Biondi said we are dealing with the report of

             the Economic Development Committee and the issue now is what

             portions of their report will be accepted by the Commission,

             There are specific questions that are up to the Commission to

             answer and make recommendations. He said the Commission has

             to be engaged in dealing with the substantive q uestions raised

             by that sectionof the Committee report.

                       Mr. Thompson said the 700,000 population projection

             for 1985 assumes an in-migration, however, this in-migration

             is substantially less than was realized in the last 20 years.

             The Commission has to face the issue of: is that a reasonable

             goal to set - to have relatively lower level of in-migration in the

             next 10 years than we have in the past  20 years,
                       Mr. Biondi said that in the Economic Development@ Com-
             mittee Report they continuously refer to the fact that in the

             period between 1950 and 1970 Delaware's populationand employment

             growth was twice the national average. Since 1970,   it has fallen

             to the national average and the national average has fallen., If

             we can just maintain pace with the national average and provi de

             the number of jobs stated in the report, we will have enough jobs

             to support the natural growth in the existing population plus

             some small in-migration. Mr. Biondi said that he has been assurn-

             ing that the 700,000 population figure relates to t hat perame,ter

             of economic and population growth. He  asked if the report now

             being discussed, in addition to revenue figures, projected to 1985,
             will indicate that we can afford that rate of growth without
<pb n="550" />

                                         -21-

             strapping ourselves anymore than we are at the present time? The

             answer to that question is yes. How much more growth can we

             afford at what cost, if we want arate of growth which is more.than

             merely enough to satisfy thenumber of jobs we will generate inter-

             nally, plus a small in-migration.

                       Mr..Krapf said that was the question in his mind: "If

             it is only a mathematical number'to go to 700,000 why can't we

             go to 800,000 or 1,000,000.

                       Dr. Latham said that Mr. Keifer did not mention some of

             the numbers behind this report, one of those being the figures
             on school age population. Mr. Fisfis's@aid that we had 1@5,000 at"

             our peak; we are down to about 125,000, we will bottom out at

             about 100,000, then when we have 700,000 people, it is projected

             we will have 135,000 school age children again - which will bring

             us back to our capacity. Therefore, Dr.,Latham. said that this

             report says if we want more than 700,000 people, we will have to

             expand the capacity of schools, then the projections are no longer

             valid and the per capita costs start to rise more rapidly.

                       Mr. Weiner said that since we agreed on 700,000 as aii

             arbitrary figure and understand that this is 3ust "for instance"

             then we can begin answering the four questions in the Economic

             Development Report. The answers in Mr. Keifer's report are not a

             response to those 4 questions and Mr. Weinerfelt that even when

             we have a Statewide Land Use Plan the questions will not be answer-

             ed.

                       Mr. Weiner went on to say that these questions go into
<pb n="551" />

                                          -22-

              depth to question the assumptions that are made. They made

              the assumption that the cost per capita, for 100,000 to 125,000

              more population, assuming the level of,services to remain the same,

              will continue in a straight line curve. In order to answer the

              first question asked   on page 8, B.I., there are several important

              characteristics to take into account: 1) you have an rapidly

              expanding  population with tremendous geographical spread and you

              are playing catch up. 2) Are there latent costs of that growth

              that have not yet appeared      have.we finished playing catch up?,

              3) will the future growth in the State cost more in relation to

              per person income.

                         Mr. Weiner said there are a whole series of hypothetical

              questions that have to be outlined. He said the fourth.question

              is a little easier to answer because you are deali     ng with the

              physcial and the question of facilities that already exist. He

              said that those 4 questions, unless the.Commission is willing to

              work for the next 6 months or year, are    not going to   be answered

              by us- not in the fashion that we would    want to put our name     on.,

                         Mr. Biondi asked Mr. Weiner how the Commission should

              answer III-C. on page 9 which says: "The Delaware Tomorrow Com-

              mission should establish population and employment growth goals

             ...... .  Mr. Weiner said the Economic Development Committee, in

              Part I, have already.done that. He said he is willing to accept the

              series of figures put together in their report.

                         Mr. Biondi asked Mr. Weiner if he was then saying that the

              population and employment goals to be established by the Delaware

              Tomorrow Commission should be those which are consistent with the
<pb n="552" />

                                        -23-

            job growth goals spscified  by the Economic Development Committee

            on a population of 700,000  for the year 1985. Mr. Weiner said

            he-would be willing to accept them for the next year, however,

            he did want-to look at them again in a year.

                      Mr. Bradford felt that the first two questions on page

            8 have, in essense, been answered, in that we have said that the
            examinations of the debt service, to a point, indicates'that

            "catch up" is pretty well in the planning pipeline. Therefore,

            the answers to question 1 is less relevant to question 3and 4

            than they were when they were,asked. However, Mr. Bradford felt

            that que,stions 3 and.4 need.further consideration by the Commission.

            He asked if  it was the intention of the Commission to produce at

            this point in time a report which makes recommendations over a

            10 year period or to set forth one level of growth., which is almost

            non-growth and raise the questions that.have to be answered (3 and

            4). He asked if this Commission is, in a position to make a final

            recommendation as to growth over ten years at this point?

                      Mr. Weiner said that planning is,a constant,process.

            He reads the report Ito say we want some.growth, a fair amount of

            growth, we want growth in certainareas; we want.growth that will

            recognize the need to cluster ourcommunities, as well as to bring

            in growth that will provide jobs. However, he feels that you can-

            not every make a projection that will stand up for 10 years. Mr.

            Bradford said that was the exact point he was   trying to make.

                      Mr. Thompson said that the Economic   Development Committee,

            in these Job and population projections, assume a lower rate of

            growth in the next 10 years, than we have had   in the last 20 years
<pb n="553" />

                                          -24-

            by a substantial margin. The Commission has to answer the

            question: is that acceptable? He went  on to say that the popula-

            tion in Delaware is going to change in the next 10 years just from

            the people who are already here. That population will generate

            a larger work force than now exists in the State. The percentage

            of people working will be larger 10 years from now than we have

            now, whether we have any in-migration or not. Therefore, we are

            going to need more jobs just to provide for that change in the

            demographic make up of the population. In addition, they thought

            there would besome in-migration just to  take care of industry

            that is already here.

                      Mr. Biondi asked Mr. Thompson if the rate of growth

            which is suggested by the job numbers and the Cost of Public Services

            Committee, a 700,000 population projection- isn't that a base rate

            for economic growth, or a minimum rate which we must afford? Mr.

            Biondi said it is substantially less than we have had. It wi 11

            provide only 50,000 more new jobs. Mr. Biondi felt that the Commiss-

            ion must identify that as A base or a minimum rate of growth which
            must be afforded, we have tochange economic and tax policies in the
            State to see that we meet it, and then we must go on, on a year to

            year basis, looking at our assets and liabilities and what our

            costs are of growth beyond that.to see how we will deal with it.

            However, this seems to be a framework of a minimum or base rate of

            economic growth which must be afforded.

                      Mr. Thompson said he agreed to that view in the sense that

            the 700,000 projection is pretty close to a no-growth pattern, as

            compared to where we have been in the last 20 years. There is just

            enough growth in.it to provide the margin of jobs -for the people
<pb n="554" />

                                         -25-

             in the State. It will.require s ome in-migration to support that

             just because you may not have all the technical background yot.

             may need in the existing population to take care of existing jobs.

                       Mr. Biondi said, looking at the total, figure in Column 2

             of Table VI, are not we saying that we have to afford this rate

             of growth and to go beyond this rate of growth and to stimulate

             more growth, we.had better get concrete answers to these four

             questions and other questions which have been raised- in this

             Commission about the cost of growth.

                       Mr. Thompson said he did not think we have faced the

             fact of what growth has cost us in the past 20 years. He has the

             feeling that our highway system has deteriorated in the last 10

             year or 15 years. He doesn't know what it would cost us to get back

             where we were 10 years ago or whether we need to go back to where

             we were 10 years ago. That question is not answered by the data

            @given to the Commission today.

                       Mr. Biondi asked Mr. Thompson what rate of growth he

             thought we should achieve in Delaware in the next 10 years. Mr.

             Thompson said he is a low growth man- he would not recommend the

             kind of growth we had in Delaware in the last 20 years. However,

             he wanted the Commission to understand that these figures represent

             a change. He said he would not recommend a lower rate of growth

             than the suggested 700,000, however, he would notrecommend a much

             higher rate of growth than that.
                       Mr. Kriegernoted that, in addition to Mr. Keifer's

             report, he has another report which backs up and substantiates

             Mr. Keifer's figures and on those schedules you can see that they
<pb n="555" />

                                       -26

             have attempted to develop the numbers of what it would cost

             for the growth per capita. Mr. Biondi said this    issue would be

             addressed later.

                       Mr. Cooperson expressed concern that there seems to be

             an assumption, which he does not fully agree with, that somehow

             in a State this small that the changes we can make in our fiscal

             and tax policy are such that we can fine-tune the growth to the

             degree that is being addressed by the Commission..

                       Mr. Biondi disagreed and said that the whole discussion

             indicates that nobody-in the room thinks you can fine tune.growth.

             What they think is that there is a minimum level of growth that is
             going to be required and in order  to achieve that we  have got to

             reverse alot of policies we have had in the past.

                       Mr. Cooperson said he does not question the desirability of

             having growth because growth is inevitable.

                       Mr. Chamberlin said that the concept being put forth by

             Mr. Thompson can be expressed more clearly if you separate the ideas

             of population and economic growth. He felt that if you look at the

             two separately and.say, for instance, that we would consider a net
             rate of 4% of population growth,and 3% of economic growth, the

            @implication of.that is that the gross growth rat e of the State, if

             you defined it in terms of dollars, would be 9% per year and you

            .could project that out. He felt that Mr. Thompson, in the Economic

             Development Committee report, was saying that.we are going with

             basically a very low population growth rate but the demographic

             characteristics of our base population are such that   they are going

             to put more people in the employment field and it will.be necessary

             to expand the economic growth rate  to accommodate those persons to
<pb n="556" />

             be employed. By looking at the two of those, he felt that

             Mr. Thompson is saying., in terms of policy, that while you may

             not become aggressive in terms-of population growth, you are

             going to have to undertake some fairly positive and aggressive

             policies in terms of economic growth to provide the number of

             jobs that wi 11 be necessary.

                       Mr. Thompson said that if we can regress some of the

             things that have been depressing economic growth back to where

             we were on a more normal basis, we would get that kind of economic

             growth without bringing an awful lot ofnew industry into the State.

             The industry in the State already would provide much of that growth.

                       Mr. Krapf completely disagreed with Mr. Thompson's state-

             ment. Mr. Thompson said where new industry may be needed is that

             where there are unemployed and underemployed in Wilmington and

             Sussex County, we may have to bring some industry in to provide
             a balance economic growth. However, in the large numbers of the

             kind of growth that is', we will get in the next,10 years, it will

             come out of existing industry in the State.

                       Mr. Krapf said he still disag reed because, as an example,

             most companies are "increasing production yet they are cutting

             down on employees per man hour of production" Companies are employ-

             ing'less - not more.

                       Mr. Biondi then opened the discussion on Mr. Krieger's

             report. Mr. Krieger  said that after the Cost.of Public, Services

             Committee meeting, and the meeting between Mr. Krieger, Mr. Latham,

             Mr. Keifer and some of the Delaware StatePlanning Office staff

             members it was agreed that Mr. Keifer's staff would work up the
             debt cost projected to '1985 and all the breakdowns as shown on
<pb n="557" />

                                            -28-

             Table VI. Mr. Krieger and his staff took the increases in

             the budget from the Cost of Public Services report ( the period

             1968-1973), then related it to a real growth fact or took into.

             account the inflation factors and found that   the dollars increase

             at a rate of about 9% a year. In schedule II, they put in an

             estimated increase in population starting with 19.74 up to 700,000

             by 1985 and showed the percentage changes. in population  by year, which

             was mentioned          ly, -are not large changes    less  than 3k%
                            previous

             per year.

                       Back in schedule 1, they have the   estimated population

             figures broken down on three premises - one   of 8.76% increase, one

             at 5% and one at 15% which is possible but not.p.robable.

                       In schedule II, they broke the cost increases down to

             show what the real cost would be for the increased population

             numbers.  Those numbers show that there would be a normal increase

             in the budget figures each year. Then they-tried to breakdown how
             much debt.increase was caused by the increase in.population.
                        Mr. Krieger noted that this number, as compared to Mr.

             Keifer's number, shows the total current budget figures in 1985

             to be $1,635,000 - not including debt service. He said Mr. Keifer's

             debt service number is pretty accurate because.he was working with

             known numbers and that came to $244,000,000. This means that Mr.

             Krieger's projections show that the.total outlay would be $1,879,000.OOC

             'Mr. Keifer's figure was an 8% rate and Mr. Krieger's was at a 9%

             rate. Mr. Krieger   felt that the two figures are fairly close.
<pb n="558" />

                                      -29-

                       Mr. Krieger went  on to say that the Economic Develop-

             ment Committee question on page 9, item 3, asked them to relate

             the cost of the growth and what Mr. Krieger attempted to do on

             schedule II is to show what the cost would be, personally, for

             that growth. The answers that they came up with shows, with a

             8.77%.increase in the.future, that it would only cost us a little
             over $1,000 per person for every person.who comes into the State.

                       Mr. Krieger also mentioned thatall of the Cost     of Public

             Servicenumbers were related to population and not to participating

             companies, so that-when you talk about cost figures, even    though

             we have several large companies in Delaware that pay large taxes,

             everything is related back to individuals.

                       Mr. Krieger felt that to answer the questions asked by

             the Economic Development Committee    what does it cost to bring

             people into the State? The Commission's determination would have

             to be can they afford it or do they want to spend the numbers

             that they project to be somewhere between approximately $1,000

             in 1974 -1975 and $2,200,in.1985. Does the State want to adopt
             a policy of spending approximately $1,OdO per person with in the

             next 4 or 5 years to bring people into the State. Mr. Krapf asked

             'how many dollars does the average person pay in taxes? Mr. Krieger

             said right now they are paying close to $1,000 a person,.-overall.

             He said we have a balanced budget in the State, so whatever we

             have is paid for. So   in the next 5 years, it will cost around

             $1,100 per person for  new people to come into the State     in inflated

             dollars).
<pb n="559" />

                                        -30-

            Another number that is a key  number, as far as the questions

            asked in the Economic Development Report  is that we know that,

            not including debt retirement ( and debt retirement is costing us

            about $28 a person today per year) that we are spending about $852

            a year, per person on all levels, to operate the State. By 1985
                                        it
            with the 700,000 populationAonly increases to about $2,300 per
            person and about $35'0 counting Mr. Keifer's assumptions of

            $40,000,000 capital budget each year for the next 10 years. That is

            only about $2,600 a person per year.

                      Mr. Webb noted that the per capita income  increases by

            compounds of 11% to 12% a year between now and 1985. Taking

            1,600,00.0.that comes out to about 2,400 per person as compared to

            $586 now. This would take a per capita income of about $25,000 per

            person to keep the percentages exactly where they are now- which is

            11% of per capita income to support State and local governments.

                      Everyone agreed that the results of Mr. Krieger's report

            are consistent with the results of the study done by the Delaware

           .State Planning Office. Mr. Biondi asked if Mr..Keifer had any dis-

            agreement with what Mr. Krieger did. 'Mr. Keifer said   he did not

            understand-how he got the incremental population change-  where did

            they come from?   Mr. Krieger said they were just put in  to get the

            700,000 figure on a consistent level hasis    figuring that the larg-

            est impact of the Committee's report would hit about 1976-1977.

                      Mr. Biondi said that both reports,indicate we have seen the

            expenditure side of this and it would seem that a revenue side,  based

            upon the same assumptions of the Delaware State Planning Office
            report is nec essary so we can see the relevance of this and the signi-
<pb n="560" />

                                        -31-

             ficance from the point of view of portability.

                        Dr. Latham agreed that this was possible. However,

             he felt it would be more realistic to project revenues at a lower

             growth rate than the expenditure side, simply because we will con-

             tinue to see the cost of government excelerating more rapidly

             than the governments revenue sources possibly can. That is what

             we have observed for the past 5 years.

                        Mr. Chamberlin said that another.caution for making

             projections that.are based on population by drawing a comparison

             he said, you are looking at basically 130,000 population increase

             over the period being discussed and at the same time looking at a

             net increase in housing ( for example) of 60,000 dwelling units,

             which is disproportionate to the population increase. The reason
             for this is tha .t you have demographic changes occuring and the house-I

             hold formation is the determination of.housing      not gross popula-

             tion. Since housing is often related to some of the cost of public

             services there could be an even higher increase in this.area.

                        Mr. Biondi said we need someone with expertise   to look

            @at the income side of this   picture.

                        Mr. Webb said the  point that he was trying to make   pre-

             viously is th at two groups  have agreed that the cost of  government
             in 1985 would be around $1,600,000,000. He.said if you     accept that

             and you have a population of 700,000 in   1985, the per capita cost

             is $2,350 per person ( the cost of government). If you are going

             to support-that with the same percentage of per capita income, which

             you did in 1973 ($586 which was.11% of per capita income), you need
             a per capita income of $25,000.. Anything,less than that means a

             tax increase.
<pb n="561" />

                                       _32-

                         Mr. Biondi asked Dr. Latham to work with the Delaware

              State Planning Office, utilizing common assumptions that were

              used in the expenditure report and do a revenue      report that

              parallels that. That report will bediscussed at the next meeting.

                         Mr. Bauer, Director of the New Castle County Planning

              Department, presented to the Commission the following position

              paper by the  Administrator of New Castle County:

                    The Delaware Tomorrow Commission has requested     thatNew

                    Castle County submit   a statement on the development of

                    a growth policy for Delaware and specifically,     the

                    est ablishment of a growth rate. The statement     herein

                    presents several considerations New.Castle County wishes

                    to make to the Delaware Tomorrow Commission for its delibera-

                    tions.

                    Growth policy necessarily involves questions of multiple

                    values within the community. The establishment of a growth

                    policy must be based upon some overall philosophy regard-

                    ing growth. It is   our judgement that a growth policy

                    should attempt to meet economic, social, As well     as

                    political values for the total community. The      first

                    appropriate public response to this issue must     be the

                    development of a clear understanding of growth. It.

                    must be understood that growth is not an isolated, one

                    shot event but is a continuous process to.which      public

                    policy must respond. In order to do so, governments

                    through pub lic policy must anticipate to the    extent possi-

                    ble elements of  growth. They must attempt to     understand-
<pb n="562" />

                                        -33-

                  how much growth is likely and be in a position to

                  respond in regard to how much growth, when, where and how.

                  Only by building a mechanism which does so can the.public

                  sector avoid putting itself.in a catch-up position. In-

                  cluded in this analysis must be concern for the fiscal

                  impact that differing growth will have.. This should

                  include policies for equitably distributing the incre-

                  mental costs of growth. Developing an understanding of

                 ,the trends in.growth and establishing.an overall philo-

                  sophy toward growth is, to New Castle County, the most

                  important first public response.

                  In our judgement, a growth rate for Delaware should

                  not be established. Attempts to project overall costs

                  in the public sector are also questionable. Rather,

                  what we see as needed is public policy which understands

                  that growth is a continuous or on-going phenomenon

                  and must be dealt with on a short-term flexible basis.

                  The question of a growth policy is believed by New Castle

                  County to be two separate but interdependent situations.

                  The first is the question of economic growth for Delaware;

                  the second is the question of population growth for Dela-

                  ware. Public policy regarding growth in our judgment

                  should consider these as separable issues requring differ-

                  ing approaches.

                  In regard to economic growth, this means establishing

                  policies which influence economic.deve.lopment. Such
<pb n="563" />

                                       -34-

                      policies should seek  to maintain the existing

                      economic base of the  community and to identify

                      specific weaknesses in the economic base. Such

                      weaknesses may be an overdependency on a particu-

                      lar industry or a particular unemployment charact-

                      eristic. In conjuction with this,   there must be

                      continual monitoring of the, availability of jobs

                      and specific policies targeted to meet specific

                      unemployment needs.

                      In regard to population growth policy,,the public

                      sector is in the best position when it establishes

                      policies that can accommodate the population growth

                      which will respond to the economic conditions.

                      New Castle County feels the establishment of an

                      arbitrary employment or population rate of growth

                      either by specific number or percentage as a policy

                      will not be effective and it may, indeed, be counter-

                      productive. What.is needed is a set of policies,.

                      many of which have already been discussed by the

                      Commission, which will allow theJurisdictions through-
                      out Delaware to respond better to changing conditions.,

                      Growth policy is effectively carried out b y spe cific,.

                      practical or feasible policies which can be implement-

                      ed. The setting of goal-like numbers or percentages
                      does not supplant these policies. New Castle County

                      supports the development of policies.which anticipate

                      growth and are on a short-term, responsive,. flexible.,

                      continuous basis.
<pb n="564" />

                                        -35-

                        Mr. Biondi said that most   of what the Commission

              has done is to look at Land Use and   Community Development and

              set forth some policies with respect to problems involved in

              land use, has taken a  tough view of the cost of public services

              and has done so with a questioning view, recognizing the

              difficulty of projecting those overall costs. In the area of

                                          ommission         ntified those areas
              Economic Development, the C*           has ide

              where there are problems and recommended policy changes with

              respect to them. He said he saw no disagreement between New

              Castle County's position  paper and what the Commission has done

              in those.areas.

                        With respect to the advocacy of a growth rate by

              the Commission, the Commission has not at this point (and     Mr.

              Biondi does not expect the Commission to) taken a position     that

              they should set as a goal an increaselin   the population of

              a given number by a specific date or a rate of growth in employ-

              ment. However,,he felt the consensus of the Commission is that,

              over the next 10 years, we will need a g  rowth rate which approxi-

              mates 309,000 jobs- whic h calls for a population of around 700,000.

              The problem areas identified by the Commission in their Economic

              policies are intended to remove obstacles to obtain that rate of

              growth. He felt   that beyond that rate of  growth, the Commission's

              position is that 309,000 jobs plus 700,000 people are a target

                                                                       11 the
              which must be re-evaluated each year on the   basis of a'

              factors that they have discussed with respect to the Commission's

              policies. It does nothing more than, if you are looking at a 10

              year plan, provide a guideline for the first year of the plan

              only. He said that if the Commission approaches the problem
<pb n="565" />

                                        -36-

             on this basis, he does not see a tremendous difference between

             what the Commission is saying and New    Castle County's position

             paper.

                        Mr. Bauer said that,  in his  17,years working for 3

             different  county governments, people tend to get hung up on the

             numbers game. It has been his experience that whenever they
             attempt to project into the futu  re in term s of numbers or' in'

             terms of growth rate, they always end up being wrong. If it

             would be a policy of the Commission that they,will re-evaluate

             on an annual basis, he could support that., However, he caution-

             ed against getting to a point where everyone says that by 1985

             we,will have 700,000 people- not one more orone less.

                        Mr. Krapf said that you need some sort of planning

             process. Mr.   Biondi said that Mr.. Bauer was trying to say that

             in discussing  growth in general,there is no central authority

             which can arbitrarily make decisions throughout the business

             community and the population dictating what is going to occur.

             The Commission is saying that we haveidentified the problem;

             with.the base rate of growth we need; we have identified problems

             in reaching that; we have, suggested some recommendations. for

             dealing with-those problems. Beyond that, we have,     to look at

             the problem each year and determine what the benefits are-and

             what the costs are going to be.

                        Mr. Krapf said he thought everyone in.the room agreeds

             with that.

                        Mr. Weiner said that he thought'New Castle County paper

             was  an excellent statement. He felt that it should be added     in

             its  essential form.because  we have not used the,concepts and   look-
<pb n="566" />

                                          _37-

            ed at it  in the broad framework. that this statement poses,

            although  that kind of thinking is implicit in some of the

            things the Commission has discussed. He said the fact remains

            that there is a real danger of playing the numbers game. As

            a preamble to that numbers game, we should recognize a number

            of things pointed out in the position paper, because it makes

            the assumption that we need to  .respond. If the population

            of the State of Delaware responds with a  birthrate which is

            higher than what is projected.in the 700,000. Figure - what

            are we going to do? He said he would like to see New Castle

            County's position paper incorporated into the Commi-ssion Report

            as the kind of approach to the whole question of growth.

                       He further stated that if the Commission decides to

            talk about 700,00 0 popula tion as we currently see it and if we

            talk about an increase in the number of jobs as we currently

            see it, then we have done two things:

                    1) we have said we are making  a assumption for this

                        year as to what that growth looks like 10 years

                        from now, however,

                    2)  we are doing against the background and the concept

                        of that kind of statement.

                      Mr. Thompson took strong exception to Mt. Weiner's

            statement.   He said that the judgement of the Economic. Develop-

            ment Committee was that the  State could influence the rate of

            growth by what we do. We are not at the mercy of unseen forces-

            although there are some forces over which we have no control.

            The  State, by reasons of policies that could be  adopted, could

            do a good deal to have a  rate of growth that is  closer to 800,000
<pb n="567" />

                                          -38-

              in 10 years  than 700,000.  He said that we cannot ignore the

              issue of whether  we should try to do things to get 800,000

              .or whether we should be satisfied with 700,000. We have an

              option-on that.

                        Mr. Weiner said that never before has there been any

              mention of controlling growth and he strongly objected.to this

              idea.

                        Mr. Thompson clarified that the Economic Development

              Committee felt that the State, by its actions, could influence

              growth- although it could not control it completely. He said

              that the Commission started out a year ago on this position

              with the idea that they ought to stimulate new i,ndustries com-

              ing into the State in order to provide jobs for our people. The

              Economic Development Committee  then figured out the minimum number

              of jobs they had to stimulate  in.order to stay even. The Commission

              has to decideif that is a sufficient rate of growth to set as a

              target and to influence public policy or should public policy

              try to stimulate a much higher rate,of growth?

                        Mr. Biondi  said that his understanding was that the

              Commission was going  to have to change.their  public policies in

              the economic area, for example, to-merely provide the basic mini-

              mum.number of jobs.   When you start going beyond that, however,

              you can proceed on the assumption that you will have to pay for

              what we need. We have a couple of studies done which indicate what

              we need as in the realm of what we can buy. What the Commission's

              said is that we can not project 10 years down   the road in the

              long run; that the numbers are not, available;  that you have to
<pb n="568" />

                                            -39-

             start out with some sortof a   base, reevaluate it annually.

                       Mr. Thompson felt that today'the Commission ought   to
             set some sort of goal - which can be adjusted yearly.

                       Mr. Biondi said he was willing to set a goal as

             700,000 as base (minimum) rate of growth. He doesn't think.

             we ought to survive with less.

                       Mr. Biondi said no one including the Economic Develop-

             ment Committee set any goals in terms of jobs or population

             what has been a set projection.

                       Mr. Biondi said that the'Commission has saidthat they

             have some responsibility  to talk about how we will pay the.cost
           .:for gTowthand based upon the numbers the'Commission has been able
             to develop, that is the only posture you could proceed on,   based
             upon the'fact that that is the minimum need we ought to satisfy.

                       Secretary Daniello said he would like to see a policy

             set which would accomplish some standard for Delaware that would

             accommodate the projected population and job increase that is in

             the Economic Development Committee report.

                       Mr. Weiner said the issue is a question of control.

             The responsibility of  government, as he-understands it in our

             political economy,,is  essentially to do those-services, that

             the private sector cannot do. The responsibility of government

             is to respond to the needs of the people and the communities-

             not to make the determination that we shall go to a certain

             figure (700,000 or otherwise) and no mote. He feels that in

             order for government to be responsive, it has to recognize the

             limitations of our natural resources,  our physical environment,

             our social and economic environment as it comes alon
                                                                   9.
<pb n="569" />

                                         -40-

                        He felt that we could start with some specific
              figures that will give some indication if the fact that growth
              is here, that a no-growth policy. is impossible in a dynamic

              society such as ours; and that it  be re-examined. However, he

              does not feel that governments responsibility is to say "this is

              how far youare going to grow -,no more."

                        Mr. Biondi said that there was no argument with those

              ideas.

                       Mr. Cooperson said that we have all agreed that there

              are certain inequities in our present legislative and planning

              structure in Delaware which ought to be removed, which will

              provide for what Mr. Bauer called "maintaining the economic  base."

              Mr. Cooperson said that as he understands what Mr. Thompson   was

              saying, is that you can go beyond that with policies which  the

              government will take to actively encourage growth. For example,

              you could have a roll-back of taxes on new industry coming into

              the State for 10 years, as the City of Wilmington has  been doing
              with new buildings. This is a positive policy, which   could,

              theoretically, increase the rate of growth  in the State of Delaware.
                       Mr. Weiner repeated  that he thought New Castle County's

              paper was an excellent statement. He feels   that we ought to

              .ado pt some definitive numbers, simply so that there are targets

              however, it needs to be done without any notion of control but

              with the notion of dealing with the problems that confrontlour

              communications and our State.

                       Mr. Bauer said that  he did not feel that the position

              paper of New Castle County is      inconsi stent with what has been

              said in previous discussion. He  said that he is not a good enough
<pb n="570" />

                                                   41

              planner   to predict  what the conditions in New Castle County

              are going to be     15 years down the road. Obviously, we use

              numbers for transportation planning, for sewer planning, for

              water supply, etc.     However, if'we.are saying that the Delaware

              Tomorrow C  ommission   said in 1975 that the target population

              is 700,00'0 people@in 1985-and when we reach 700,000 people in

              1984 that is it.

                          Mr. Biondi said no one    on the Commission has any dis-

              agreements with    that philosophy.     He, further, stated that    he

              was thinking about the Commission       taking out of the Economic

              Development Committee report        the job provisions and population

              figures there and using those      as a base rate (minimum) of economic

              growth and taking it subject      to the qualification that it is a

              growth goal which has to be evaluated annually and not one that

              you can stick with over a long period of time. He said that, to

              his knowledge, no one has talked about growth           in Delaware) in

              that kind of context. Nobody has asked the kind of questions

              that have been asked about the cost of growth. The Commission has

              had a difficult time in finding answers., However, for the first

              time in considering    growth questions, someone has looked at it

              in advance and raised relevant questions,about the cost.of          it.

                          He further felt that it would be      irresponsible   for

              the Commission to suggest a rate of growth        beyond  what. he considers

              to be a minimum that we are going to have        to learn to   afford un-

              til we learn to develop     the cost/benefit answers as we       go along.

              That is why we have to look      at it  on an annual  basis.     He feels

              that the job and p   opulation   projections of 700,000 is      the best

              judgement that can be made     on the   basis of the information    we have
<pb n="571" />

                                             42

              in July of 1975, giving full consideration that a new look

              will be taken on a continuous basis.

                        Secretary Daniello saidthat he felt that if   the word

              11projections" were used instead of "goals", this would solve a

              lot of concerns.

                        Mr. Krieger made the motion that New Castle County   is

              po sition paper be accepted by the Commission and.reviewed and

              considered in the final deliberations, Mr. Biondi said that

              these are the final*deliberations. He   said that,Mr. Bauer is

              talking about problems in the same context that the Commission...

              is and he feels that the philosophy stated with respect to growth

              policy in New Castle County's position paper should be incorporated

              as part of the Commissions philosophy in looking at the growth

              question with a caveat that this is only a preliminary statement

              of a.target to work with at the present time. He feels that.

              the target should be the needs that were spelled out in the

              Economic Development Committee report.

                        It was moved and seconded that Mr.  Biondi's suggestion

              be adopted. All present were in favor. Mr.    Biondi said that we

              would call this a "conditional vote". He said that we have to

              look at the revenue side carefully and we may want to reconsider

              that position when we look at the,revenue side.

                        Mr. Weiner made a motion to amend III. Conclusion, to

              use the word "projections" instead of the word "goals". This

              motion was seconded and approved by all present.

                        Dr. Latham said that the revenue side could be-addressed

              by himself and the Planning Office staff by this time next week.
<pb n="572" />

                                           43

                       Mr. Weiner said that the four questions posed by the

            Economic Development Committee are  relevant questions, however,

            he felt there is a fifth question  that is not posed, yet is

            implicit and it deals with the revenue side. If we are going

            to have growth and the cost of that growth rises as a percen-

            tage of the budgeted income, what is the alternative? He said

            that the "gut" questions.is: if we are going to have growth, who

            pays for it? He said there needs to be   the question of who is
                    ible for population growth and where does the responsibi-
            responsi

            lity lie-at the public or private level, for-the assumption of

            those revenues and for how they are distributed.

                     Mr. Biondi said that  the revenue side will be discussed

            at the next meeting. which he  suggested be held on Wednesday,

            July 30, 1975.

                       Mr. Oldach suggested that, rather than changing the

            word "goals" to,"projections" that it be changed to read: "In

            order to establish reasonable plans for future  population type

            of growth". He reason   for amending Section III. Conclusion was

            that it is,a little more than just a projection,  it is a planning

            activity. Mr. Oldach's suggestion was moved and   seconded and

            agreed to by all present.

                       Mr. Biondi announced that the next meeting of  the

            Commission will be held on Wednesday, July 30, 1975, at   the

            Wilton Community Center  at 4:00 p.m.

                       Mr. Biondi noted that the Commission had previously

            published a "Preliminary Draft Report", prepared  by Dr. Latham,

            and distributed  to the Commissi.on. This report was never
<pb n="573" />

                                             44

              discussed, due to  the fact that the,report was written on the

              assumption that the recommendations of the Committees would be

              accepted by the Commission as written. However, substantial

              changes have be.en made to the Committee reports.. On the ques-

              tion of what form a preliminary reprot should take, Mr. Biondi
              felt that the Commission ought.to.produce a preliminary narra-
              tive to the report, which discusses the background of the Com-

              mission (the establishment of the Committees, membership, and

              the work accomplished,  etc.) and that a preliminary report should

              be published, including exactly what was,voted on and approved

              as reflected in the minutes. When that preliminary report is

              done (hopefully by the end of August) it should be distributed

              to the Governor, members of the General Assembly, the press    and

              the general public, with a statement that we intend to take the,
              report to public hearings in September. Based upon the results

              of the public hearings  (possibly one in each county) a final

              report will be compiled and submitted to the Governor.,

                        Mr. Biondi further  stated that.the recommendations.

              being made by the  Commissionneed to be   carried out at various
              levels'of local  government.  He felt that the Commission ought

              to consider whether we ought  to recommend a future role for the

              Commission after the final report has been submitted to the
              Governor (in the formof the   Commission itself,  a Committee   of
              persons on the Commission, a  continuing body of  the Technical

              Advisory Committee, etc.) so  that there is someone  around in

              the future to look at the projections and see how far we have

              gone to solve some of the problems illustrated bythe Commission.
<pb n="574" />

                                           45

                      Mr. Krieger moved that the meeting-be adjourned at

            approximately 9:00 p.m. This mot-ion was seconded and agreed

            -to by all present..

                                         Respectfully submitted,

                                         Dee Burkley.
                                         Recording Secretary

            DAB/hmck
<pb n="575" />

                                   STATE OF DELAWARE
     DAVID R. KEIFER                PLANNING OFFICE                  PHONE: (3021 678-4271
        DIRECTOR                         DOVER

               Ref: 1007-1404

                      MEETING OF THE DELAWARE TOMORROW COMMISSION

                                     July 30, 1975

                     A meeting of the Delaware Tomorrow Commission was

               held in Wilton Community Center on July 30, .1975.

                     In attendance at the meeting were the  following:

                     Francis Biondi, Chairman of the Commission
                     Sherman Webb' Office of the Governor
                     Dave Keifer, State Planner
                     Carl Oldach, Retired
                     Dorothy Greer, Delawareans for Orderly Development
                     Jay H. Cooperson, Sierra Club, Delaware Group
                     Ernie Thorn, Common Cause
                     Arthur Krieger, Attorney
                     Bill Bradford, Wilmington Trust
                     Eric Brucker, University of Delaware
                     Leon N. Weiner, Leon Weiner and Associates, Inc.
                     Robert J. Berndt, Senator, Delaware General Assembly
                     N. C. Vasuki, Dept. of Natural Resources and Environ-
                                           mental Control
                     J. C. Bryson, Secretary, Dept. of Natural Resources
                                           and Environmental Control
                     Cliff Hall, Secretary, Dept. of Highways and Transportation
                     Marcie Bierlein, League of Women Voters, Delaware
                     Ross E. Anderson, President,.Delaware Chamber of Commerce
                     Spencer Thompson, ICI, America
                     Peg McClane, League of Women Voters
                     Marion I. Seibel, Representative, Delaware General Assembly
                     Bernard Dworsky, New Castle County 208 Program
                     Merna Hurd, New Castle County 208 Agency
                     Steve Chamberlin, Leon Weiner and Associates
                     Marvin S. Gilman, Leon-'Weiner and Associates
                     Henry Folsom, President New Castle County Council
                     Carl Russell, New Castle County Office of the Executive
                     Ed O'Donnell, New Castle County Department of Planning
                     Joseph Conaway, Sussex County Administrator
                     Dan Kuennen, University of Delaware
                     Lance Werner, University of Delaware
                     Fred Krapf, Frederic Krapf and Son
                                                  EXECUTIVE DEPARTMENI
                                                    SHERMAN W. TRIB-1-11       T7
<pb n="576" />

                                                         2

                                       Chairman Biondi called the meeting to, order._

                           At the end of the last meeting, the Commission     started

                   discussing the cost  of, growth. Some assumpti0ns were used,

                   to follow along the lines of what was suggested by the
                   Eco Development  Committee    Report,  that. is, the State should

                   look to 1985 at, a growth rate that          would give us a total

                   population of 700,000, about 309,000 jobs; and  this could

                   be a target for goals , with the understanding -that these

                   figures constitute a     starting, point     which would have to be,
                   updated each, year., -Then the CommissIon considered., the cost
                   0f growth, In order to do this-, the Commisslon members

                   examined', two reports: "Operating and Capital Cost ProJections
                   Delaware State and  Local Governments 1973-1985" prepared by

                   the Delaware State Planning Office which projected the cost,

                   of  goverment to be $1,645,800-by 1985; and the second report,

                   prepared by Mr. Krieger, using different concepts than those

                   used to prepare       the report of the State Planning Office,.

                   especially regarding the population projections.                   The only

                   final conclusion reached was that Mr. Krieger s   report came

                   to almost the same cost figure for 1985.
                           After considering the projected cost of               government,
                   the Commission asked the'State Planning Office and the

                   Cost of Public Services         Committee to foresee         the revenues

                   to carry out the services. A third report has been prepared,

                    A Comparison of Projected 1985 Governmental                 Revenues and

                   Expenditures in Delaware", by the State Planning Office which

                   replaces the two previous reports.
<pb n="577" />

                                            3

                     Mr. Webb proceeded to explain that this report was

               prepared by a team headed by Dr..B.ill Latham and a separate

               revenue estimate team headed by Mr. Kalhil of the Division

               of Revenue. They both used slightly different parameters

               to arrive at their estimates, but their deviation.was 1.3%,

               so the report re flects Dr. Latham's estimates. The report

               is broken down into State General Fund Revenue, followed by

               revenues to other units of governments as well as federal

               funds. Within State General Fund revenue, it is broken into

               four different categories:  Franchise tax, Personal Income tax,

               a group of revenues based on a,number of units sold, and

               General Fund revenues (real estate tax, corporate tax, etc.).

                     The Franchise Tax would increase at a level equal to

               the expected level of inflation between.now and 1985--5.15%.

               Mr. Kalhil felt that the,increase would be below the rate

               of inflation so that on a constant dollar basis, there is

               no change, but building in the inflation, we would arrive

               at a figure of $87,000,000 by 1985. This assumes that there

               are no changes in the tax laws during 1975-1985. Using

               Mr. Kalhil's estimation, the estimated 1985  Franchise Tax

               collection would be $65 million (in 1985 dollars).

                     The Personal.Income Tax will increase as the number

               of people move into higher tax brackets. It is assumed
<pb n="578" />

                                          4

               that the inflation average between now and 1985 is 5.15% which
               will affect the per capita income tax level. It is proposed
               a real economic growth in the period to average 3% per capita,
               per year. This means an aIverage increase in personal income
               tax of approximately 8.1 5%. In 1980 dollars, a figure of

               $379 million is arrived at. Mr. Kalhil assumed that the figure

               would reach in the neighborhood of $410 million. A combination

               of the inflation rate, new job fo rmation, net in migration,

               and real growth will average 10% per year over the period

               covered, so a higher estimate is arrived at.

                    Mr. Thorn commented that if we are recommending that

               consideration.be given to decreasing our highest bracket of
               income tax, should his Committee's recommendation be reflected

               in that. Mr. Webb replied that taxes were estimated on what

               they are.

                    Mr. Folsom noted a couple of errors in the expression

               of the footnote in the table on page 1, in the 1985 Collectic-is

               column, it should read ($48,008,488) x. (1-8269) (and not 1,8269)
               and in the *footnote,,it should read 1.8269=(1.0515)12 and not

               1,8269=(1.0515)12.

               The Flat Dollar Amount of Tax Revenues(motor fuel, cigarettes,

               alcoholic beveragep motor vehicle fees-except the document

                                                                  ill
               fee, etc.). The number of units sold of these items w
               only increase as a function of the population and these taxes
<pb n="579" />

                                            5

               will remain constant through 1985.. It was assumed that,

               possibly the motor fuel revenue may be decreased (5 to 8% drop

               in real gallons between 1975 and 1985) while the others may

               increase--so it was estimated that there would be no change

               except that brought about by population growth. Through

               historical trends, since 1967, it was found that these assumptions

               were correct. No increases in the taxes were assumed.

               All other state general fund revenues including corporation

               income tax, pari-mutuel (sales and admissions), inheritance,

               insurance, business and occupational, real estate, public

               utilities, dividends and'interests, gifts, etc., will increase

               by the inflation rate plus the impact of population growth

               over the next ten years. Some of these tax revenues are

               cyclical and subject to updraft and downdriaft, but as a@

               general rule, these revenues would have a tendency to   increase

               with the real growth population change and the inflation rate..

               This trend has been experienced in the past, except for those

               taxes that have been imposed recently, of course.

                     The above mentioned revenues were left out in the

               report, this omission will be corrected..

                     Included in "All Local" are comprised of the revenues

               from  the local school districts, plus the operating revenues

               of the general. fund receipts of the three counties, the

               City of Wilmington, Newark and Dover. State and local
<pb n="580" />

                                             6

               revenues were  projected as remaining constant in 1973

               dollars and in 1973 per capita terms. The 1985      level in

               1985 dollars is produced by multiplying 700,000     people and
               inflating that rate at 5% per year. It is more       difficult.
               to estimate the local-revenues because some of the municipalities

               buy and sell el.ectr.idity--and the price rise function and

               the profit marginare not known. Also not known are the

               property value and the nature of the housing     for a 700,GOO

               population.'.AgaiTi., it was assumed that school taxes would

               not be raised.   It was..noted,that about half of the local

               revenue figure  comes   fr.om,.re al estate tax, Another problem

               was that most  of the  counties-have just recently completed

               a re-assessment,  therefore., no re-assessment was considered'

               between now and  19.85.

                     Federal Funds.    It was a'ssumed that the percentage of

               existing revenues  would  remain constant. The increase of

               federal revenue sharing money.between 1973 and 1975 is

               negligeable.

                     The dramatic:point   arrived at is that total revenues

               in 1973 were $530  million-per capita revenue was $924--

               with a population  of.573,000; with an increase in population

               of 573,000, the total revenues more than double and the per

               capita revenues double., Between 1967 and 1975, the general

               fund revenues increased at about lk% higher rate than the.
               inflation rate for that period and fell short of expenditures

               by something in  exces s. of $90 million. It is not a new

               phenomenon that  revenues,do  not increase in and out of
<pb n="581" />

                                             7

                themselves at a rate equal to the demand   of the expenditures.

                      The methodology and assumptions portion of. the report

                                                                 to the report
                was explained by Dave Keifer.. Referring back
                produced by the State Planning Office and distributed at the

                last meeting, all operating costs were held constant in per

                capita terms because of the short time allotted to come up

                with the report. Taking a second-look at expenditures, the

                Planning Office tried to give mare.reallstic figures by taking

                historical trends and seeing how they move from FY '73

                to FY '76 and make adjustments to obtain more up-to-date

                calculati ons. Also judgements were made as to how the

                expenditure rate might change between now and 1985, as a

                result of what might be considered inevitable commitments.

                The local expenditures were not considered. It was assumed

                that the 1973 expenditures would remain constant. The

                bonded debt was not looked at either, it was assumed that

                it would amount to $40 million pet year in 1973 dollars.

                      The categories have be en kept the same. There is an

                error in the first line  of "Education", it.should be 1985,

                not 1978., Mr..Biondi asked whether the drop in number of

                pupils in the public system would have any bearing on the

                per capita cost of education. There is a declinein the

                number of enrollment, Mr. Keifer   said, but because of

                the total population figure of 700,000, by 1985 the State's

                enrollment will be about up to 1973 level.
<pb n="582" />

                                             8

                      In regAr ds. to,j!@wa@s (operation), the Planning Office,
               took the population, figure for 1976, of 590,000ias the base,
               and this was, applied to the budget. It assumes $20 million

               in constant dollars. for construction. For transportation,
               the figures from 1976,to 1985 were increased at the rate of
               10% per year. It was sug   .gested-to add "and Transportation"

               in the sub-title.

                      There is a split in Health and Hospitals to reflect a
               commitment to staff programs that will be coming, on line-

               which is basically the reason for the increase. The State

               is committed to the geriatric programs, as an example.

                      Concerning the Sewerage and_Sanitation was held constant

               per capita at 1976 level.

                      Parks and Recreation, the.Planning Office increased

               2% annually based on the theory that, during the 1960's the
               State bought 'a lot of land for parks and fish and game

               activities. The capital investment has been increased       to

               develop the land recently. During the,next ten years       some

               of the parks will be  coming on line and expenditures will

               go to operating and maintaining those parks.

                      The Financial Administration figures (comprising the

               entire Department of  Finance, the State Treasurer, the Budget

               Director, the Auditor* of Accounts, and Central Data Processing)

               were held constant per capita. There was a discussion as to

               how income tax refunds should be considered: should they be

               considered as an expenditure or as   a decrease in revenues.

               Since different rates of growth are used between revenues
<pb n="583" />

                                            9

               and expenditures, Mr. Webb  was asked whether this factor was

               considered. Mr. Webb replied that fiscal 1975 revenues were taken

               because this was a "clean" year--when everything was paid

               in the year that was due in the year and the.8% inflation

               rate was not used--a closer to actual percentage was used.

                     Pensions were  projected to increas e 5% annually. This

               includes a,three item area. First the 1976 constant dollars

               were taken because of the tier  system and to arriving  at the

               Pension Plan itself. Blue Cross and FICA reflect what the

               Social Security Administration says.and will dollars grow to

               cover the State share of Social Security payments for State

               employees as well as Blue Cross. It was felt 5% was a

               reasonable increase percentage.

                     Dr. Brucker commented that if Table 2 of this report

               is compared to Table 6.of the previous report,  it is found

               that the only category that is going to increase by less

               than the constant real percentage is education...The original

               report showed a $26.7 million in constant dollars for highways,

               the State Planning Office report now shows a  $48.3 million--

               this is a-legitimate comparison showing a much faster increase

               per capita.

                     Moving to Table 3, on page 9, the 1973 deficit was $71.4

               million.  What makes up this deficit, Mr. Biondi asked? It

               is not the 1973 deficit, it is the 1985 deficit in 1973 dollars,.

               Mr. Keifer replied.
<pb n="584" />

                                             10

                      Mr. Krieger asked where the figure of $330.2 million
                for local goverments expenditures came from. Total governmental
                expenditures 1985 dollars is $1,856.8 million; and
                1985 State expenditures should be $745 million. This figure,
                Mr. Webb said, is a combination of federal and local expenditures.
                Footnote "b",      of Table 3, should explain this.

                      Do we arrive at the conclusion, Mr. Biondi asked-, that

                we will haVe to increase taxes by the amount of the deficit
                in order to fund a population of 700,000 people?
                      Ail the Calculations were made Mr. Webb said 'Without

                increasing the amount of programs. It is a fact that new

                programs will be instituted during the period considered.       If
                it is assumed thAt the general revenue is $100 million low,
                it is also likely that there will be $100 million wort h of new
                programs. it is also reasonable to assume that (the way the
                legislature works)we are looking toward a $100 million deficit
                over the next ten year period for State government.
                      If the deficit at the State level    is $374 million and
                the deficit at the local level is $113 million,and the two
                are added together a figure of $487 million is obtained.
                Looking to Table 2, the State expenditures are $1,105.2 million.
                This figure is carried over to Table 3, but looking at local
                and others the figure is $745.1 but only  $330.2 was carried
                over. The reason given for that was because of the federal    funds.
<pb n="585" />

                      On Table 2, the Stat'
                                            e government columns did not

                include any federal funds at all (strictly General Funds).

                After further checking, Dr. Brucker found.that the expenditures

               .for local governments should be.$430 million-with a deficit

                of $213.7 million. Another crosscheck.is to take combined

                Table 1 and Table 2 in the 1985.total governmental expenditures

                projected $1,856.8 billion, the total revenues in Table 1

                were $1,262 billion and the difference is $594 million. It

                was determined  that an error in calculation was made and that

                this would.be corrected.

                      Does it mean, Mr. Biondi asked, that in the year 1985

                taxes on the State and local levels will have to be raised

                to raise $600 million more than now. It was noted that      this

                represented a 50% increase. The answer came positive.

                      Mr. Wiener said that he did not see the purpose of the

                whole exercise of finding out how much deficit the State

                and local governments will have to face by 1985. The only

                conclusion, as of this date, with the set of assumptions explained,

                the State will have to.have a higher tax rate if we want to

                continue a rate of services. There is no.real input as.to

                the kind of curb required for capital expenditure,,

                for debt service other than a projection assumed of a capital

                bond of X number of dollars in each of the next 12 years. All.

                these assumptions are vulnerable. Mr. Wiener said he       felt
<pb n="586" />

                                                  12

                 that this document served no  real purpose.

                          Mr. Webb said that this points Out twO of 0ur

                 problems: 1/3 of the State: revenues projected between

                 now and' 1985 wi11 increase at a rate   f ar below, the level of
                 any inflation. If the-Franchise Tax and the other taxes (cigarettes,.

                 alcohol', motor fuel, etc.) were responsive, ther e would not

                 exist as large a problem. The. main- reason why taxes had- to

                 be increased between: 1 1963 and 1975. was bec ause the,Franchise

                 Tax  was not res-ponsive to, inflation.Between. 1967  and", .,

                 the growth of General Fund, Revenue., without taxes,, was, only

                 1/12%     more than the, rate.. of. inf lation on. an annual, basis.
                 Mr., Webb felt that, given the. unforeseen factors (such

                 as took place as aresult of the Arab oil embargo and the

                 subsequent economic crisis) that inflation was understated

                 (through 1985), and, that the: revenues. and expenditures. were

                 overstated: in the., July 29, 1975 report.

                        Mr. Bradford said that he. thinks this, projection of

                 $600 million deficit by, 1985, is as. good. as the assumption,.

                 If  a 5% deficit had shown, it    would.' not have. made  much

                 impact,. but (out of. the. calculations. came the fact that the
                 deficit represented 50% of the revenues estimate): with such

                 a: figure-,, it is a guideline that indicates that something

                 will have. to be done,   either in curbing      expenditure or by

                 increasIng the revenues. The order of         figures is significant

                 and of serious-   magnitude.
<pb n="587" />

                                            13

                      Mr. Biondi commented that the magnitude of this deficit

                indicates that when the Commission discusses its report and

                the question of growth-rate comes up,, the Commission should

    NOTE:       indicate two things: all sectors,of the economy in the State

                are going to have to look forward to paying increased taxes

                per capita--substantially so in the next ten years--and it

                has reached a point where we cannot afford some of the luxury,.

                inefficiencies and waste in State government., It may indicate

                that government streamlining may have to.be accomplished; and

                the way we render services will have to be examined. Ten years

                from now, we will not be able to operate under the same structure

                as we are operating now. In terms of the Delaware family unit,

                this also means,that in the concept of the quality of life, the

                standards of living will deteriorate significantly--about 50%.

                It was noted that the cost of State government between 1969 and

                1973 increased tremendously, but this was due to all the new

                programs that were instituted, such as the pollution protection,

                etc., while this 50% increase between 1973 and 1985 is entirely

                without any new programs. It was said that even the biggest.

                industries are "tightening their belts", such as duPont for

                instance, and there is no reason why State gove .rnment could

              ,not do the same. It was agreed that the area where this
                "tightening up" should be done is in the sector.o,f public and

                higher education, which entails the largest part of the State

                budget (51%).
<pb n="588" />

                                          14

                     Unless someone undertakes the problem from this point

               forward to recommend broad scale government reorganization

               and governmental economy, the Governor who will be elected

               in 1984 will look like Mayor Beam.

                     Representative Siebel commented that there are too many

               layers of government for the 565,000 population   There are

               also things thatcould be done at the regional level,

                     Mr. Biondi said he does not look at these findings in a

               negative w*ay. Considering the 1985 population projection figure
               of 100,000 and the projected 409,000 jobs, he thinks this is

               necessary and desirable. Looking at,these figures as a base,

               and continu. ing to re-evaluate them--what these figures show.

               is that we cannot go on in the next ten years thinking that

               everything will work itself out without.any dramatic effect

   NOTE:       on the taxpayer. As the State goes, economies will have to

               be realized or the increases in taxes which will be necessary

               will kill off the minimum degree of growth.
                     Mr. Wiener raised this question:, is the high.cost  of

               government projected by 1985 a direct result of the population

               increase or is it because the standards of the quality of life

               that we have set are-too high and, therefore, we cannot pay for.

               them. If we want these standards,we will have to pay for them.

                     Chairman Biondi asked what the Commission members felt

   NOTE:       about the problem. Mr. Folsom said that the Commission is

               not the body that will be able to do anything about this problem.

               It is basically-a political problem. The politicians will
<pb n="589" />

                                              15

                spend  as much money to buy the services tha   t the people are

                crying for and will collect as much tax as possible. The

                Commission will do well to point out the trend and the

                magnitude of the problem, it,will be to no avail to cut back

                on education, on overhead, that we should combine the State

                and county police because these are political decisions brought

                by the pressure of the voters.

    NOTE:              Dr. Brucker commented that   if the solutions to the

                problems are in the hands of the    politicians, and that the

                politicians react to the public's demands then it is up to

                the Commission to  present the facts to the publi   c.

                       Steve Chamberlin commented that the magnitude of the

                cost increase is not a major factor that has a direct relationship

                to the population increase.

                       It was further noted that the cost increase was due to

                inflation, thetypes of services the people are receiving, the

                increase in the services by certain segments of education.

                       Dr. Brucker mentioned that it is not only an inflation

                factor, but the fact that the expenditures are going to inflate

                fas ter than the revenues. We are also    discovering that the

                cost of service oriented operation will go up much quicker than

                the cost of manufacturing. This is a trend in the economy,

                the productivity increases are not there in the social services

                delivery.
<pb n="590" />

                                               16

                       Jay Cooperson commented-that the quality of life we

                 have comes out ofour personal dollars. There are many

                 things that the State Government spends on to improve the

                 quality of life. There may be some serious questions asked

                 as to what areas we should spend our tax dollars on. How

                 much are we willing to pay for pollution control,.water, quality,

                 etc.   If the State government is going to provide for sewer

                 plants, for instance, it    will provide, jobs, it will provide

                 provide for a distinct modifier. Maybe there should be some

                 distinction as to where the government should spend its money.

    OTE:               The Commission arrived at this general consensus:

                       I. The State faces a problem: it will take a substantial

                 amount of dollars more to run State government and provide

                 services to the people,-by    1985.

                       II. The rate of.cost increase (50% by 1985) cannot be

                 attributed to the increase in population.

                      III. The rate 'of cost.increase is due mostly because

                 the revenue grows at a   different rate than that of expenditu-ze

                 because of the nature of certain revenues.

                      .IV. The expenditure    increase is function of Jnflation.

               ..State. government is in the   service rendering   business and

                 'increase in productivity,,  in the service area, means a decrease

                 in the quality of the services provided.

                       V. In order to combat these problems, State        government

                 will have to give a serious look at more efficient       ways of

                 delivery system.

                       This information has to    be disseminated to the public.,
<pb n="591" />

                                           17

                     If the types of revenues are notgoing to be adequate
               to.handle our expenditures, then the Commission should make

               the politicians aware of the fact that some alternate ways

               should be found to bring in revenues. Maybethe total

               funding base would have to be reconsidered--not only at the

               State level, but at the county and local level.

                     It was suggested that the report under discussion be

               reworked to.cotrect the several mistakes and additions in

               the text and in Tables 2 and 3. This report will be considered

               a work (or discussion) paper.

                     There was some discussion as to the stipulations made

               in the two footnotes on page 9. it was decided that the

               caveat and reservations have to be Trentioned in the report.

                     Mr. Biondi said that there are still three matters

               for consideration by the Commission.

                     1.  Mr. Conaway's concerns regarding.Sussex County

               development.

                     2. The definition of   open space, as stipulated by

               Dan Kuennen's.sub7c6mmittee.

                     3.. The preparation of  the Commission s preliminary

               report, the time schedule, and public hearings,

                     After a dinner recess, the  Commission reconvened.

                     Mr..Biondi said that while  serving in the Land Use

               Committee, Mr. Conaway felt there were some areas of concern
<pb n="592" />

                                               18

                to Sussex that had not been touched by, the Committee Mr.

   NOTE     Conaway, prepared' a, dbcument making certain, recommendaions:

                           a, The, development of. a cooperati0m effort, between

                the Depar_tment of. Community Affairs- and Economic Developmen t and
                the Sussex County Council to actively recruit industry to Sussex.
                           b. Expanding the economic base of Sussex through

                the_attraction,of.a more-diversified industrial base to.the

                county... Efforts should  be made to assure that the perspective

                industrial clients are shown the entire State.

                           c. Assuring the:protection of the-economic ,potential

                and* the viability of the Nanticoke River by whatever legal or!

                political step necessary.

                                Expanding the list of-potential industrial sites

                in the, county. Such- a li st shou1d'be developed in.cooperation

                with the county`s present plan to pinpoint such locations

                around the county;...

                           e Developing a, realistic attitude towards, the

                development. 0f_the county.

                      Mr. Conaway commented that since these recommendations

                were wrItten, new,development-took.place:     a cooperative working
                ef f ort- has Been made. between, the Dept. of Com. Aff:. and, Eco.

                Dev. and the: county. The: county feels that many times an.

                industry would have     settled in Delaware had it, been exposed

                to what.southern Delaware has to offer.. There was an attitude

                that Sussex County is.essentially a.tourist.or play-ground

                county, but there are-also areas. in the county tha    t can be.
<pb n="593" />

                                            19

                used for industrial development. The Nanticoke    River is a

                natural river in Sussex County and should be protected; but,

                the Commission should emphasize the use ofthe river as a

                natural way of transport to bring inthe oil and to take the

                grain out.

                      Mr. Biondi assured Mr.  Conaway that the Commission,

                report will reflect the.-concerns o f.Suss,ex County as to the
                fact that Sussex County should not be considered as a summer

                playground".but give thoughts about the 85,000 people who

                live in Sussex County year-round and need permanent jobs.

                      It has been recommended by the Commission.that after

                the report is published, some kind of a continuing body

                should be in existence made up of the people who have been

                involved in the Commission's and Committee's work to provide

                a continuing look at the findings and recommendations.

                      Mr. Thompson said that his Committee,agreed to the

                need of an on-going group. In order to be effective, this

                group has to have easy  access to the Governor, to the

                Secretaries of the Departments. Also, some talents have been

                discovered through the  Delaware Tomorrow.project that should.

                be tapped, possibly ret ired persons who.have.time on their

                hands.  This kind of support is-critically needed in the

                State.
<pb n="594" />

                                               20

                       Senator Berndt said-he would     like to see the  Commission
                include in the body of the report     the problems,facing.the

                State. A recommendation should be made also., in the,report,

                that we seek means-to implement measures to avoid such a

                heavy deficit. There are ways of consolidating bureaucratic

                institutions--for example, many feel that      the University of

                Delaware and Delaware State College should    be consolidated;

                and-there are.many more    ways to save,and be    more-efficient  by
                consolidation. Another  example, Senator Berndt gave is the

                laboratory services,provided by the State. The Medical

                Examiner has its own Forensic Lab-oratory and yet the DNREC

                has- the same need that is pro vided at the Forensic Laboratory.

                      An0ther view which   was brought up is the fact that

                many times  the -legislators are   concerned about particular.

                pieces of legislation on a day-to-day basis while there is

                a need for a group such as the Delaware Tomorrow Commission

                to look at longrange problems.

                      ,Jay Cooperson; mentioned that whatever the   Commission,

                suggests and recommends be clearly understood and the only

                way to do this is. through a group whose purpose will be to
                make'all these findings clear to the     public.. Out of the

                Commission has come a consensus-, a better understanding)

                for instance, has been achieved'between   people with different

                interests regarding the Coastal Zone.Act. If we are. able to

                sustain the same kind of spirit    that  has animated the Commission,

                we can probably do something that will satisfy most people in

                Delaware. There is a pressing need to continue the life of
<pb n="595" />

                                           21

               the Delaware Tomorrow Commission beyond the publication of

               the report.

                     Mrs. Greer asked if there was any relationship between

               the DelawareTomorrow Commission (and/or its successor) and

               the final land use plan that was recommended.

                     Mr. Keifer said he hoped so. The Commission has given

               the task to come up with a statewide land use plan., The

               present Commission has the general notion on whatneeds to

               be done and it is absolutely necessary that the same people

               and talents be involved in the development of the.land use

               plan. There has to be a continuity in the development of

               the ideas.

                     Mr. Biondi noted that the Commission has discussed

               some very major problems that have been facing the State.
               These problems, previously, have been discu ssed in veryloud

               voices. This Commission has achieved an across the ta  ble

               dialogue with positive recommendations and contributions.

                     It is necessary to continually review and update

               the findings of this Commission and by this very need,

               there has to be an on-going group to over see this.

                     It was mentioned that the Commission has found its

               existence through a Governor's Executive.Order with a

               lifetime duration if so desired--but,.it may be helpful

               that the Commission be reaffirmed by joint resolution.

                     Mr. Thorn also mentioned the fact that the Commission

               had suggested to bring the recommendations of the Commission

              --tothe legislators through possibly a group appointed by the

               Governor.
<pb n="596" />

                                                22

                       Mr.. Biondi said that he looks to the present Cofnmisti6ti
    OTE:         to get this done. Mr.,Biondi suggested that (although this

                 may cause tome people to be unhappy about his decision) he

                 would see involving the people who have participated actively

                 in the di.@cus-sions of the Commission and in the "homework"

                 of the Committee's (recommendations,.and ... preparation of the.

                 reports) as, well as those people who have been involved in

                 a staff function. These people would make up this group.

     NOTE:              Cotsidering the actual format of the report, it should

               'contain:

                        I. An Introduction indicating      why and when the
                 Commission came into existence.,
                      II. A general overall summary containing the         d  ifferent

                 elements of the report.

                     III. The report itself      should contain all the categories:

                 Land Use and Community Development, Economic Development and

                 Cost of Public Setvites; the recommendations of the Committees,

                 as modified by the resolutions and motions of@the Commission.

                 reflecting the language the Commission agreed upon. (A preliminary

                 report was prepared and distributed to the Commission.' This

                 report was prepared in a narrative form--Mr. Biondi said that
                 this concept is not acceptable.       The report shou-1-d reflect

                 exactly what the Commission agreed upon).
                      IV. An Appendix. This appe       .ndix should  contain  the

                 studies done for the Commission and referred.to in the work

                 of the Commission; the reports,of the three Committees,as

                 received by the Commission before      the Commission modified them.
<pb n="597" />

                                                 23

                 the  papers such as the ones presented at these       meetings

                 with  all the reservations that are contained in the minutes

                 and. the qualifications and the complete elaboration of their,

                 meaning;.the minutes of the meetings as prepared.

                        Possibly, the Appendix could be separate and distributed

                 on request.

    NOTE:               The consensus of the Commission was that this was an

                 acceptable format for the report.

    )TION.              Through a motion duly made and      seconded, the assignment

                 for the preparation of the report was       given to the State

                 Planning Office. A draft report will        be made available to the

                 members of the Commission by September 5.

    AOTE:               The definition of "open space",as prepared by Dan

                 Kuennen was accepted and will be incorporated in the body

                 of the draft report. If there are any comments, they can

                 be made at the September 5 presentation.

                        A motion was made and seconded and unanimously adopted

                 that "special thanks be extended to Mr. Leon Wiener for.his

                 hospitality for the use of Wilton Center and to Jane
                 'for the pr'@paration of the food. A letter will be written

                 by Dave Keifer to each one@'.

                        There being no further business, Mr. Biondiadjourned

                 the meeting.

                                                        Respectfully submitted,

                                                        Francine Booth
                                                        Recording Secretary
<pb n="598" />

                              DELAWARE TOMORROW COMMISSION

                              MINUTES OF NOVEMBER 25, 1975

                  A meeting of the Delaware Tomorrow  Commission was held

             at 7:00 p.m., November 25, 1975, at the  Wilton Community Center.

             The following Commission members were present:

                  0. Francis Biondi, Chairman
                  David R. Keifer, State Planner
                  Ross E. Anderson, Delaware State Chamber of Commerce
                  Peter A. Larsbn, Greater Wilmington Development Council
                  Frederick G. Krapf, Jr., Fred Krapf and Sons, Inc.
                  J. Thomas Schranck, Secretary, Department of Labor
                  John D. Daniello, Secretary, Depart.of.Com., Affairs &amp; Econ. Devpt.
                  Dorothy Greer, Delaware for Orderly Development
                  Jay H. Cooperson, Sierra Club
                  John Walton, Delaware Farm Bureau,
                  Joann D. Slights, Watch Our Waterways
                  Ernest W. Thorn, Common Cause
                  Clifford E. Hall, Secretary, Department of Highways &amp; Transp.
                  John C. Bryson, Secretary, Dept. of Nat. Resources &amp; Env. Control

             Also Present:

                  E. Sherman Webb, Governor's   Office
                  William D. Markell, University of Delaware
                  William Bradford, Wilmington Trust Company
                  Arthur H. Krieger, Krieger, Dwares, and Stein
                  Spencer Thompson, ICI America
                  Stephen W. Chamberlin, Leon.N. Weiner, Associates
                  Carl Russell, County Executive's Office
                  Merna Hurd, New Castle County 208 Office
                  Bernard Dworsky, New Castle County 208 Office
                  Dan Kuennen, University of Delaware

                  The meeting was called to order at 7:10 p.m. by Chairman

             Biondi. Item #1 on the Agenda was a review of the Draft Report

             of the Commission. Chairman Biondi noted that all comments made

             by Commission and Committee members were noted and checked against

             minutes of the meetings and Committee reports. Most of the

             changes were incorporated into the report, and Mr. Biondi felt

             that the report was revised sufficiently to be addressed  at
<pb n="599" />

                                          2

          public hearings. Everyone present agreed with the Chairman.

          However, Mr. Bryson did notethat he had found some minor errors

          in the Report that were not completely factual.
               Mr. Biondi noted that he' had copies of the speech he

          delivered to the Delaware State Chamber of Commerce distributed

          to the members of the Commission for the purpose of showing that

          he stayed within the lines of the report.

               The second agenda item was Plan s for Dissemination. The

          first 53 pages of the report@is actually the body of the repor.t.

          It was reprinted for distribution to the public and a limited

          number of copies of the appendix are also available upon request.

                                                                        as
          There has been a fair amount of interest from the press. It w

          agreed to send the 53 page report to all Committee members of

          the Commission.

               Mr. Kuennen@suggested holding a press briefing with down-

          State periodicals in order to inform them of the report, its
          Gontents, and the Commission!s attempts1to reach the public.

          He also suggested a variety of other techniques to reach the

          publicsuch as:,slide shows,,TV and Radio talk shows, presentations

          at the various colleges in  the State, etc.

              ,.Mr. Anderson suggested that the emphasis be placed on requests

          for the Delaware Tomorrow Report as opposed to distributing copies

          to uninterested parties.

               A variety of mailing lists were discussed, and it was agreed

          that,the Planning Office would compile a list, together with

          the various mailing lists of other organizations to mail a letter
<pb n="600" />

                                              3

             out indicating the availability of the report, the  nature of  itp

             and where copies may be obtained. It was also agreed that.a

             pre ss release be mailed out to the media announcing the public

             hearings and where copies of the report may be obtained.

                  It was agreed that copies of the report should be sent to:

                       1. All Delaware Tomorrow Committee Members
                       2. The General Assembly
                       3. All Public Libraries
                       4. The Delaware Delegation
                       5. All Mayors or local officials

             The Planning Office will be responsible for distribution of these

             materials. Letters notifying the public of the availability of

             the report will be sent to the names on the Fortune Mailing List,

             as well as the Media through a press release.

                  on the subject of public hearings, Mr. Biondi stressed that

             he felt it was importatnt.that Commission merp.1-jers.attend all the

             hearings. It was  agreed that the Commission members have an obli-

             gation to promote the ideas agreed upon in the Report. The merits

             or outcome of the public hearings were debated in great detail.

                  It was agreed to hold one public hearing in each   County. If

             there is a necessity for more hearings in a particular County,

             they could be scheduled at a later date., The dates of the hearings

             will be as follows:

                       Tuesday, January 6, 1976, Kent County
                       Wednesday, January 7, 1976, New Castle County
                       Thursday, January 8, 1976, Sussex County
             The locations will be announced by the State Planning Office at

             a later date.
<pb n="601" />

                                          4

               Mr. Biondi pointed out that, in addition to the Public

          Hearings, there are many clubs, organizations, civic groups,

          etc.,'at whose meetings the Commission members might speak and
          I'spread the word" of the Draft Report. Commission members are

          encouraged to get active.

               Mr. Anderson suggested that the first public hearing be

          scheduled with the legislature and then hold.the three County

          hearings. It was agreed to meet with the General Assembly the
          week of January 20, 1976.

               The format for the hearings was debated at length. It was

          agreed.not to impose a time limit on speakers within reason.

          It was moved and seconded that the Chairman decide how the pro-

          cedural format of the hearings will take place.

               On another issue, Mr. Biondi announced that a report is

          available through the New Castle County 208 office, titled:

          An Industrial Policy Analysis Paper, prepared by Hamer, Siler,

          George, Associates. Copies are available at this meeting and

          the Chairman felt that many of the findingsin that report are

          similar to the Commission's Report.

              .The Chairman said that several issues need to be looked into

          regarding the Commission's Report and the recommendations in that

          report: 1. We have to identify the level of Government at.

                       which the various recommendations should be dealt

                       with, and,

                   2.  We have to figure out the kind of Governmental action

                       required (Executive Order, Administrative Action,

                      @Legislation, Planning, etc.)in other words, what now?
<pb n="602" />

                                             5

                 The Chairman further questioned whether the Commission, as

            a group, ought to look into these issues, or if they should be

            turned back-to the three Committees.

                 Mr. Keifer suggested that the Technical Advisory Committee

            be given a "first shot" at the recommendations and prepare  .a re-

            port to be sent to the Commission and other Committee members,for

            their reacti on.

                 Mrs. Slights felt tha t the Commission would be out of order

            to begin drafting legislation prior to the public hearings.

                 Mr. Biondi said that there no basic objections to asking

            all Committees (including the TAC) to identify the levels and

            nature of governmental action necessary to implement the report.

            The Committees, through their Chairmen, are therefore requested

            to do so.

                 Mrs. Slights, quoting from the Hamer, Siler, George Re p ort

            discussed above, noted an inaccuracy on the first page: "A.l.

            Delaware Tomorrow Commission has recommended the development of

            a Statewide Land Use Plan to remove the inequities of the Coastal

            Zone Act". She pointed out that nowhere in the,Delaware Tomorrow

            Commission Report is that stated. Mr. Biondi   pointed out that

            this report is also a draft and any problems Commission members

            have with this report should  be brought to the attention of the

            New Castle County 208 Office.

                 Mrs. Slights made a motion that Statement A.l. of the Hamer,

            'Siler, George Report is an inaccuracy. Mr. Walton seconded that

            motion. Representatives of the 208 office pres  ent made note of

            the error.
<pb n="603" />

                                           6

               Mr. Biondi requested that Commission members take the time

          to read the entire report, as it has merit. He further asked

          Mrs. Hurd (Director of the.New Castle County 208 Office distri-

          buting this report) to bring to the consultant's'attention that

          the Delaware Tomorrow Commission has recommended the development

          of a Comprehensive .Statewide Land Use Plan, however, the removal

          of the inequities of the Coastal Zone Act is not a recommendation

          of the Delaware Tomorrow Commission. If that is a subjective

          evaluation of Hamer, Siler, George,Associates, they should state

          it as such. The principle purpose, for which this report was

          distributed,was to  provide another view of th e same problems that

          the Delaware Tomorrow@.Commission.was looking at.

               There being no further business of the Commission, Mr. Russell

          moved that the meeting be adjourned. This motion was seconded

          and approved by all present.

                                          Respectfully submitted,

                                                    -A-A-

                                          Dee Burkley
                                          Recording Secretary
<pb n="604" />

                                DELAWARE, TOMORROW COMMISSION

                                MINUTES OF JANUARY 28, 1976

                    A meeting of the Delaware Tomorrow Commission was held at.

              7:30 p.m., January 28, 1976, in the Center Conference Room of

              the Highway Administration Building. The following Commission

              members were present:

                    0. Francis Biondi     Chairman
                    David R. Keifer     State Planner
                    Joann D. Slights     Watch Our Waterways
                    John F. Walton    Delaware Farm Bureau-
                    Dorothy Greer    Delaware for Orderly Development
                    Ernest W. Thorn     Common Cause
                    Theodore W. Ryan     Building Trades Council
                    Robert Berndt - State Senator
                    Ross E. Anderson, Jr. - Delaware State Chamber of Commerce
                    Clifford E. Hall - Department of Highways and Transportation
                    Peter A. Larson - Greater Wilmington Development Council, Inc.
                    Marcie Bierlein - League of Women Voters
                    Jay N. Cooperson - Sierra Club
                    Leon N. Weiner - Leon N. Weiner and Associates, Inc.
                    Marion I. Seibel - State Representative
                    J. Thomas Schranck - Department of Labor
                    John C. Bryson - Department of Natural Resources
                    Frederick G. Krapf, Jr. - F.G. Krapf and Son, Inc.
                    Carl S. Oldach - Retired
                    Edward O'Donnell     Proxy for Mel Slawick, New Castle County

              Also  Present:

                    E. Sherman Webb     Office of the Governor
                    Arthur.H. Krieger     Krieger, Dwares., and Stein
                    William Bradford     Wilmington Trust Company
                    Jorene Coffay - Mayor's Office, City of Wilmington

                    Chairman Biondi called the meeting to order at 7:45, p.m.

              He noted several changes to be made in the transcripts       of the

              three public hearings. These changes are as follows-

              January 6, 1976, Kent County Hearing:

                    Page 8, Paragraph 4, (MR. BIONDI: I don't know who it is.)

              The word "who" should be changed to "where".         . . . if that's
<pb n="605" />

                                          2

           what the portend of.       the word "Portend" should be changed

           to  portent".

                Page ll,, line 12 . . . the services or are we overgoverned

           in this State.),.the'phrase should be amended to read,".      the

           services. Are we overgoverned in t his.State?" In line 13,,
            . . . of government as we currently exist?), the word "we"

          ,should be stricken from that phrase. Line 16 ( . . . the first

           question which I was being asked. . . ), the word "I" should be

           changed to "he". Line 22 ( . . . to get and try to name a number.),

           the wor.d "get" should be changed to "go". Lines 24 and 25        they

           are at the present time. That absents new.         should be amended

           so as to read        they are at the present time-absent new.

                Page 12, line 1        of revenue as a measure to go to.),

           should be amended to read "of revenue as a way to go".

           January 7, 1976, New Castle County Hearing: No Changes.

           January 8, 1976, Sussex County Hearing:

                Page 4, line 11 ( . . . conclusion that if conservation . . .

           should be amended to read        conclusion'that if conservative".

           Line 14,        new levels of taxation, where levels of . . .

           the word "where" should be stricken.

                Page 14, Line 7 under MR. BIONDI:, the word "New Castle

           County" should be changed to "Sussex County".

                Page 15, the second statement by MR. BIONDI   . . . has been

           opposed by the Civil League . . . the word "Civil" should be

           changed to,"Civic".

                Page 17, Mr. Biondi's second statement,line 4         I'll

           have more f@armland.), the word "farmland" should be changed to
<pb n="606" />

                                             3

              Uparkland". The last sentence on page 17 ( . . . just don't

              happen in the real world -- or should they?) should be amended

              to read "just don't happen in the real world--nor should they-

                   Page 21, under MR. BIONDI:, line 5 and 6         1 think

              some of those were concerned about the Coastal Zone have argued

              in the past, and it wasn't the Coastal Zone Act,          should

              be amended to read         I think some of those who were concerned

              about the Coastal Zone have argued in the past that it wasn't

              the Coastal Zone Act.

                   That concluded Mr. Biondi's corrections to the transcripts

              of the public hearings, however, Mrs. Slights felt that there

              may be some inaccuracies to Mr. Welch's statements at the Sussex

              County hearing, Mr. Biondi said that, due to the fact that

              people spoke from their seats instead of at the microphone, we

              had great difficulty understanding much of that he aring. If
              she would like to submit any corrections, we would be glad to

              make the necessary changes.

                   Mr. Biondi noted that everyone had received the minutes

              of the public hearings. He felt that the next step would be

              to consider the.report in light@of the comments made at the

              hearings. One point made by several speakers, which is not

              addressed in the Commission Report, is the recommendation that

              the Commission continue in existence to evaluate and monitor

              the policies they have suggested. He also pointed out that

              the Sussex County Council recommended that the.Commission "get

              the hell out of business". The Chairman felt that we ought to
<pb n="607" />

                                          4

            consider the question of the continuing role of the.Commission

            as we look at how we see the Commission's role with respect to

            implementation and the Land Use Plan. He asked that everyone

            keep this issue in mind. The Commission then went on to address

            the issues raised on the Commission Report.

            COMMUNITY DEVELOPMENT PATTERNS.

                On Page 17, Mr. Lipstein, of the New Castle County Civic

            League, supported the recommendation on Urban Development. The

            League of Women Voters.raised some issues on Page 17. They

            said that the Commission's emphasis is on incentives, presumably

            public finance, with no mention of deterrents, and yet the

            section on the Cost of Public Services presents a bleak picture

            of revenues versus current expenditure. They asked that the

            Commission include a discussion of deterrents for low density

            development. Ms. Bierlein furtherstated that the League of

            Women Voters wanted to know if the Commission had considered any

            disincentives. Mr. Weiner said that the statement, as it is

            presently written, emphasizes incentives. He felt that, in a

            free society, you cannot talk about deterrents or punitive

            action. He.felt that the statement, as written, is a construc-

            tive one and should be used as a guide.

               'Mr. Biondi asked if the Commission  should modify its re-

            commendations with respect to Community Patterns Policies to

            include specific deterrent/penalty type recommendations in the

            report. Ms. Bierlein said tha t the League was not necessarily

            saying that they should, they were asking if it,had been con-

            sidered. Mr. Larson, Chairman of the Land Use and Community
<pb n="608" />

                                                 5

                 Development Committee, said that he knows of no instance in

                 any other State where legal deterrents have been adopted to

                 enforce development policies of this type. Mr. Coope   .rson

                 suggested striking the words "punitive action" from the Com-

                 munity Patterns Policies section. Mr. Larson said that he

                 would prefer to see the policies implemented through the

                 traditional land use controls (zoning and su bdivision regula-

                 tions) than try to impose another layer of regulations.

     MOTION:          Mr. Krapf moved that the Community Patterns Policies be

                 left as written. This motion was seconded and agreed to by

                 all present.

                      The League of Women Voters raised another question on the

                 section titled Community Patterns Policies. They asked several

                 questions regarding the term "available capacity"; specifically,

                 "what type of program does the Commission suggest to encourage.

                 movement into existing housing?" Mr. Larson pointed out that on

                 Page 20 of the Commission's Report, the section titled "Tax

                 Measure Recommendations" include:"l. Changes in'p  Iroperty tax

                 mechanisms to encourage renovation and rehabilitation of older

                 properties." He said that would cover housing as well as all

                 non-residcrLuial properties. The League also asked "if   a relo-

                 cation of the public school population were to occur, such that

                 empty classrooms existed in one area, does the Commission mean

                 that the State should withhold capital funding for   new classrooms

                 elsewhere? Mr. Krapf felt that issue was properly    addressed in

                 the Report and should not be changed. Mr. Weiner    agreed that

                 the statement should not be changed. He felt that the Commission
<pb n="609" />

                                               6

              should try to  provide incentives.    The minute you try   any

              punitive action of any kind, we will impose a state that we will
              regret, in terms of freedom of 'movement.

   MOTION:         Mr. Larson moved that the Commission confirm their draft

              recommendations with respect to the Community Patterns Policy

              section in its entirety. This motion was seconded by Mr. Krapf

              and agreed to by all present.

              TRANSPORTATION  FINDINGS AND POLICIES

                   The Commission went on to discuss the comments on the

              Transportation Findings Policies (page 18 and 19). At the

              New Castle County Public Hearing, Mr. Drexler recommended that

              the Commission should consider increasing the licensing fees on.
             .automobiles and increasing the tax on gasoline to encourage the

              development and use of public transportation. Mr. Weiner said

              that, once  again, the Commission is heading.in the direction of

              punitive action. What we need is the incentives of the develop-
              ment of atransportation policy that will provide the kind of

              mass transport ation, so that it becomes efficient economically

              to, abandon the use of cars and to encourage carpools, etc. He

              further stated  that the Commission's policy should remain as

              written.   There were no motion's that the Commission recommend
              that we increase   license fees and gasoline t@xes on automobiles

              to encourage                    and use of public transport   ation.
                            the  development

                   Mr. Lipstein, representing the New Castle County Civic
              League, recommended that "mass transportation" should be' used

              where it is economically feasible, but the subsidy of mass trans-
<pb n="610" />

                                                7

               portation should be restricted to those routes   which can  operate

   MOTION:     on income provided by fares.. Mr.   Krapf moved that that recom-

               mendation be adopted. This motion was seconded by Mr. Kreiger,

               however, after further reading and discussion, it was agreed that

               this recommendation not be included in     the policies of the

               Commission. Secretary Hall said that it was a good thought,

               however, realistically, if we are going to have mass tran    sit,

               it will have to be subsidized.

                    The New Castle County Civic League further    recommended

               that a Department of Transportation encompass land, sea, and

               air--much like the Port of New York Authority. Mr. Larson

               stated that that idea had been discussed by the    Land Use and

               Community Development Committee.

                    Mr. Biondi noted that the League of Women voters did not

               object to this section on Transportation Policies, however, they

               did point out that they would like to see some specific recogni-

               tion of the impact of new roads on development, along with a

              .recommendation that such new roads be locatedin conjunction with

               the Commission's other priorities--that is, non-sprawl develop-
               ment, preserving farmland, etc. It was pointed out.that No. 4

               o
                  page 19 addresses this suggestion.
                il

                    Mr. Matlack spoke at the New Castle County Hearing and

               advocated using highway money to finance a metroliner to Reho-

               both and to Rodney Square. He also suggested that the govern-

               ment require that a car on a major traffic artery during rush

               hour have at least three people in   it. There were no motions,

               by the Commission, to implement any of these recommendations.
<pb n="611" />

                                               8

                    Mr. Biondi noted that Mr. Dill,   at the Kent County'Hearing,

               saidthat there seems to be a   1contradiction in the Report: one

               area says that there is too much highway development, and for

               example, if you take the 2% of the land surface of Delaware,

               which is already devoted to highways, and if you were to' take

               the area north of the B&amp;O railroad in New Castle County and

               find that fully 10% of that area is already devoted to highways,

               then he would agree that there is too much highway in the State.

               Mr. Dill also pointed out that the report indicates that we have

               fallen behind in highway construction. Mr. Cooperson agreed

               that this area needs clarification. He pointed out that page

               32,,paragraph three, sentence two may not be in direct conflict

               with the rest of the report, however, it may be misinterpreted.

               The League of Women Voters also questioned this paragraph.

               There was also a problem  raised with the. first Transportation

               Finding on page 18.

   MOTION:          A motion was made by Mr. Krapf to amend Number 1 under

               Transportation Findings to read:"High reliance solely on the

               personal automobile in urban area for transportation contributes

               to urban sprawl.". This motion was seconded by Mr. Thorn and
               a.gre.ed to by all present.
   MOTION:          A further motion was made by Mr. Krapf to amend Paragraph

               3 on page 32 so as to make the sentence "The economic vitality

               of Delaware has declined markedly" a paragraph on its own, and

               to start the next paragraph with "Delaware has fallen behind

               in its highway programs. Upgrading of the highway system has

               not kept pace with expanding population and transportation
<pb n="612" />

                                             9

              demands.        This motion was seconded by Mr.   Cooperson

              and approved by all present.

                   Mr. Daniel Ryan (at the New Castle County Hearing) stated

              that the "automobile should not be penalized before the ability

              to have mass transit is available." Mr. Biondi felt that that

              statement is not in conflict with the Commission's recommendations.

              UTILITY FINDINGS AND POLICIES

                   The Commission went on to discuss comments on the Utility

              Policy section. The Delaware Society of Professional Engineers

              noted that they agreed with the Commission's Utility Finding #2,

              ("the routing, signing, and timing  of new utility installations,

              especially int erceptor sewers, can be a valuable tool for guid-

              ing land use"). However, they further pointed out that "Public
              Funding Recommendation", Item #2,  of not funding utility

              capacities beyond immediate needs  is in conflict.     Secretary

              Bryson said that the Commission's  statements are consistent
              with federal law. Mr. Biondi agreed that the DSPE had read

              something into the report  which was not actually there.

                   Mr. George Harrision, from Rehoboth, generally agreed

              with this section. Mr. John Tarburton, representing the Dela-

              ware State Crange, made a statement at the New Castle County

              Hearing. M  r. Biondi asked Mr. Walton if he though Mr. Tarburton

              was asking the  Commission to make any additions or changes to

              the report. Mr. Walton felt Mr. Tarburton's statement was in

              agreement with what the Commission has stated. He interpreted

              Mr. Tarburton's statement to mean that if each County were to
<pb n="613" />

                                              10

                enforce some type of land use control, there would be no need

                for discussion of farmland preservation.

                AGRICULTURE AND FARMLAND

                    At the Sussex County Hearing, Secretary Isaacs felt that
                the Commission should not only address food in the Agriculture

                Section, but also fiber and timber production. Mr. Biondi,
                therefore, suggested that #1 under Agriculture and Farmland

                Findings, be amended to read "Protection of Delaware's prime

                farmland will assure continuation of a viable agricultural

                industry, including food, fibre, and timber production, and

                making sure Delaware residents have locally grown food avail-

                able and,taking Advantage of Delaware's climate and nearby

   MOTION:      markets in Eastern population centers."    It was moved and

                seconded that Mr. Biondi's suggestion for amending the first

                finding under Agriculture and Farmland be adopted. This motion

                was carried.

                     Secretary Isaacs further pointed out that the Commission's

                recommendation for Agriculture and Farmland Policy is that we

                should preserve and protect prime farmland as defined by the

                U.S. Soil Conservation Service and includes land classified as

                I, II, and III. However, there is land, in Sussex County,

                'which has been reclaimed which would not be prime farmland

                within the meaning of that definition, but should be prime

                farmland from the point of view of its preservation as farmland.

                Mr. Biondi though there was a question of definition or classi-

                fication in that section. He asked Mr. Keifer what his office

                has done in this area. Mr. Keifer said that, as he understands
<pb n="614" />

               it, the problem is using Class I, II, and III.   There is

               another definition being drawn up by the Agriculture School

               personnel that includes Class I, II, and III as well as re-

               claimed land. Mr. Biondi suggested amending this policy to

               read "Delaware should preserve and protect its prime farmland

               as defined by the Department of Agriculture of the State of

               Delaware". Mr.  Weiner expressed disagreement with this sug-

               gestion due to the fact that he felt you were talking about

               an individual or a Department at a given moment.   There was
 IOTION:       no motion on this suggestion. Mr. Larson made a motion that

               the "Agriculture and Farmland Policy" be amended to read:

               "Delaware should preserve and protect its prime farmland  in-

               cluding lands classified as I, II, and III and including pro-

               ductive reclaimed farmlands." This motion was seconded by

               Mr. O'Donnell and approved by all present.

                    On this same section, the League of Women Voters asked

               the Commission to distinquish between "preserving" and "protect-

               ing" more specifically. Ms. Bierlein felt that   the term "pre-

               serve" conotates long term activities, whereas  "protect" is

               more short term. Mr. Larson felt that the words "protect" and

                preserve" ha-,@e a deliberate redundancy and that the words

               are essentially synonymous.

                    The League of Women Voters questioned whether the Delaware

               Tomorrow Commission might have any impact on the problems with

               inheritance and estate taxes at the federal level, or did the

               Commission intend to modify only the State inheritance tax laws?
<pb n="615" />

                                          12

             Mr. Biondi said that the fact is'that the evaluation used

             for the farmland is the same evaluation that would be used

             for federal inheritance or estate tax laws. Mr. Weiner noted

             that there is current legislation in the Congress to deal with

             this at the federalIevel. The Commission's policy and concern

             is to make sure that if it is corrected at the federal level,

             that the State have an existing policy that would attract that

             kind of thing. He felt that the recommendation is well stated.

                 Several other questions were raised by the League of

             Women Voters on the Agriculture section, however, after lengthy

             discussion, it was agreed that the Commission had covered the

             i.ssues as clearly as possible. Specifically, the League sug-
             ge sted that the formation of agricultural districts be included

             as one of the possible incentives to be investigated. Mr.

             Larson agreed that this might be a sound suggestion, however,

             he felt that this area would be covered in the Commission's

             call for a Statewide Land Use Plan. The incentives that the

             Commission has suggested are non-planning type suggestions.

             Mr. Weiner noted that he agreed with the statement on Implementa-

             tion of Agriculture and Farmland Policy as written, and he

             though it ought to be recognized that this is a general state-

             ment of policy that we should preserve and protect'and

             indicates some direction. lie does not think that this policy

             statement is an absolute caveat that a given piece of land

             shall never be put to any other use (other than farming).
<pb n="616" />

                                               13

   OTION:           A motion was made that the section on Agriculture      and

               Farmland be left as amended. This motion was seconded       and

               agreed to by all  present.

               CONSERVATION AND  OPEN SPACE

                    At the   Kent County Hearing, the Delaware Society of

               Professional Engineers said   that they support the policies

               and implementation measures   listed on page 24, however, they

               felt that public acquisition of open space should      be.limited

               to unique and important conservation areas and areas for

               planned park and recreation space. They assumed that imple-

               mentation policy #2 on p'age 24 had that intent. Mr. Weiner
 LION:         moved that Implementation Policy #2 b   e left as written. That
               motion was seconded andapproved by all present.

                    At the Sussex County Hearing, Mr. Showalter spoke about

               the use of acquifers, however, Mr.    Biondi did not feel he

               was speaking to any specific issue    in the report.

               RESIDENTIAL LAND

                    Mr. Miller,  representing the DSPE, felt that    some limit,

               on the number of  public housing units to be developed in each

               population center  must be established. Mr. Dill, at the Kent

               County Hearing, expressed concern with the lack of concern

               over the distribution of low income housing and     its relation-

               ship to the busing issue. Mr. Stazesky, of CHAD, issued a

               general statement of support for this section, with emphasis on
               Policy #2. The @eague of Women Voters questioned what powers

               and duties would an expanded Division of Housing,have? How
<pb n="617" />

                                         14

            would it differ from the present Division of Housing. The

            New Castle County Civic League questioned the use of "ade-

            quately housed"'in both the second and third policies unless

            the word "adequately" is defined as "meeting the minimum

            standards of a housing code", which Delaware should have.

            COMMERCIAL LAND

                 At the Kent County Hearing, Mr. Miller (DSPE) agreed

            that commercial development should be zoned in clusters and

            coordinated with planned pop ulation centers, and that strip

            highway commercial development is undesirable. However, once

            areas are designated for commercial development, a developer

            should be able t1o proceed through the normal permit process

            without any additional need to justify a project. Mr. Biondi

            said that he saw no conflict with that statement and the report.

                 Mr. Lipstein, of the New Castle County Civic League,

            stated that "rather than curtail commercial strip development,

            we should require parallel local roads with limited access to

            our main highway network. Such a policy would meet the criteria

            for clustering highway oriented uses rather than stringing

            them along the highways". Mr. Weiner felt that this recommenda-

            tion was a specific plan, which does not belong in a broad

            policy statement, however, his recommendation is not in con-

            flict with the Commission's sLanding.

            MAJOR INSTITUTIONAL LAND USE

                 Mr. Dehan, of the Wilmington Medical Center, issued a

            lengthy statement at the New Castle County Hearing, defending

            the Wilmington Medical Center, and outlining their planning
<pb n="618" />

                                            15

               and coordinating process.  Mr. Larson said that he had

              .drafted the statement on Page 27, which had been discussed

               and modified slightly, and he saw no reason to change this

               section. Mr. Larson further said that the policy statement

               did not address the issue of whether the Medical Center should

               build at Stanton or not. He felt that Mr. Dehan merely suf-

               fered from a.guilty cons cience.

                   Mr. Hughes issued a statement at the New.Castle Hearing

               supporting the Commission's recommendations on this section.

                   Mr. Miller, of the DSPE, supported the Commission s

               recommendations. Mr. Lipstein, New Castle County Civic League,

               said that they questioned the fact that it is not recognized

               that if a site fits all other criteria, but is contrary t  o

               land use planning, we must presume that the plan might be 'at

               fault and so should consider revision of the plan. Mr. Larson

               felt that if you go through all the steps that are outlined

               in Policy #5, you will develop a plan that is acceptable.

               Mr. Weiner felt that the last sentence in Policy #5 is poorly

               stated, and that Mr. Lipstein's comments are valid. That

               statement, in his opinion, puts the priority of a land use

               plan above the question of a consideration of a site. Mr.

               Keifer said he believed the object of that sentence was to

               make the point that the Division of Economic Development should

               not be out selling sites.when those sites conflict with adopted

               land use plans. There should be a coordinated effort there,

               and if the Division of Economic Development will be trying to

               get industrial developers to sites, they ought to be working
<pb n="619" />

                                             16

               within the context of adopted land use plans. Mr. Weiner felt

               that this should be specified. Secretary Bryson said that he

               did not think any plan was ever that final. Mr. Weiner suggested

               that the last sentence in Policy #5 should be amended to read:

               "The State shall not promote the inclusion of a site for indus-

               trial purposes without consulting with the appropriate agencies

               in the event it is contrary to the existing land use plan for

               that area". Mr. Larson felt that that sentence, as written

   MOTION:     originally, expressed Mr. Weiner's concern. Mr. Weiner moved

               that Policy #5 be amended to read: "The State shall not promote

               the inclusion of a site, for industrial purposes, when utiliza-

               tion for tha t purpose has not been reviewed with the appropriate

               agencies, if it is contrary to the land use planning in the area."

               This motion was seconded by Mr. Thorn, however, the motion was

               defeated.

               ECONOMIC DEVELOPMENT

                    On page 32, the  second paragraph from the bottom, Secretary

   MOTION:     Bryson moved that the  phrase "and air pollution problems have

               become a major issue north of Wilmington" be stricken from the

               report. He said this is an incorrect statement, as there is no

               longer an air pollution problem in the State. Delaware has met

               its secondary standards, and we are in great shape. Secretary

               Bryson's motion was seconded by Mr. O'Donnell and approved by

               all. present.

                    Mr. Cooperson raised a question on page 34, in the last

               paragraph. He read the sentence "The Delaware Tomorrow Commis-

               Sion should establish population and employment growth goals
<pb n="620" />

                                              17

                considering such things as  internal population growth,

                in-migration, type and amount of new businesses desired,

                and a forecast of the resulting changes in State income and

                expenses." He felt that that sentence   was in conflict with
                the sentence on page 14, paragraph 3, second sentence, which

                states "The Commission feels the establishment of an arbitrary

                employment or population rate of growth policy, either by

                specific number or percentage will not be effective and it

  MOTION:       may, indeed, be counter-productive." Mr. Weiner moved that

                the sentence indicated on page 34 be stricken from the Report.

                Mr. Larson seconded this motion and it was carried.

                     In a letter to the Commission, Mr. Dave Williams noted

                that "stripping away all the typical report verbiage, Delaware's

                major problem is fiscal responsibility.          Mr. Biondi felt

                that Mr. Williams' concerns were addressed in the report. Mr.

                Williams further stated that he felt that "the Commission

                should come out and say that the Delaware State   Chamber of

                Commerce has been ineffective as a private organization in

                bringing business to Delaware." There were no motions to
                change the Commission's Report to incorporate any of Mr.

                Williams' s-uggestions.

                     There were no basic disagreements with the Civic League

                and their statement on this section.

                     Sussex County Council submitted  a letter to the Commission

                with their comments on the Draft Report. Their letter indicated

                that the emphasis of the Economic Development Section is mainly

                on the redevelopment of the City of Wilmington. Mr. Biondi
<pb n="621" />

                                          18

            felt that this was simply not true      The Sussex County

            Council further noted that "the Commission  has placed itself

            squarely in a position of impeding the devel opment of Sussex

            County." Mr. Biondi pointed out that the   Economic Develop

            ment Section did indicate-that the two areas which had sustained

            economic losses were the  City of Wilmington and Western Sussex
            County. The Commission did discuss specifics in improving@the

            economic climate if the City of Wilmington; however, they did

            not discuss.specifics for Sussex County. The Council letter

            listed four specific recommendations for inclusion in the

            Commission Report. They were each discussed as follows:

                 "'(a) That the Recreation Industry be treated in the
            same manner as any industry in belaware--'.' Mr. Walton pointed

            out that in the middle of Page 36', this issue is addressed as

            follows: "These capabilities should include the    'T arget

            Industries Program' for recruitment of industries   best suited

            to Delaware, financial aid to expand tourism,and   recreation

            facilities, a program to attract foreign firms.

                 "(b) That increased financial aid to expand   tourism and

            recreation facilities be included in  the State budget; the,
            County should explore the possibility of joint funding   such

            expansion. Fees charged at State Parks to Delawareans     should

            be immediately discontinued." it was agreed that therewas

            too much detail in this recommendation.

                 "(c) That the economic base of Sussex County be expanded

            through the at traction of a more diversified industrial base
<pb n="622" />

                                             19

               to the County; efforts should be  made to  assure that all

               perspective industrial clients are shown   the.entire State."
               Mr. Krapf.agreed with this recommendation, however, several'
               members of the Commission'felt that this   issue had been
               addressed in several areas of @he report   (including page 36).

               In spite of these comments, everyone   agreed that there was

               no policy reason for not including a   section entitled "Sussex

               County Findings" following the "City   of Wilmington Findings

               on page 43, incorporating recommendation (c) of.the Sussex

               County Council letter. It was agreed to change the word

               11perspective" in (c) to "prospective".

                    "(d) That the people of Delaware must be educated about

               the economic problems of Sussex County so thata more realistic

               attitude towards the planned and ultimate development of the

               County can be obtained; it is time that the people of Delaware

               realize that there is more to Sussex than our beaches." It

               was also agreed to include this recommendation    into the @"Sussex

              'County Finding" up to the word,"obtained".

  MOTibN:           It was moved by Mr. Weiner, and seconded by Secretary

               Hall that the Commission include a section titled    "Sussex

               County Findings" into the Commission report which will in-

               clude recommendations (c), changing "perspective" to "prospective"

               and (d), down to the word "obtained". This motion was agreed

               to by all present.

                    Mr. Larson said that the Commission had.recognized the

               southern counties in  the Delmarva Advisory Council Findings on

               Page 39. Mrs. Slights asked if Kent County might not feel
<pb n="623" />

                                              20

              slighted as averyone is mentioned except     Kent County. Mr.

              Biondi said that he hoped not.

                    On page 32, the League of Women Voters questioned the

              statement "the total cost of new industrial construction in

              Delaware has become expensive".     The League did not disagree

              with this statement, but pointed    out that it is equally true

              of the other 49 states. They asked if the inclusion of this

              statement was meant to imply that industrial construction        cost

              has rise n more in Delaware than in other States? After a

              lengthy discussion, it was agreed to strike the second sentence

              on page 32, and amend the first sentence to read "Delaware can

              no longer  expect to grow  rapidly simply because of.its formerly

              competitive edge in the   cost of industrial construct   ion." The

MOTION:       above recommendation was   moved by Mr..Weiner, seconded by Mr.

              Larson and approved by all present.

                   Mr. Fran                              Land Value Tax Connittee
                            k Nelson representing the

              of Delaware, at the New Castle Hearing, stated thatproperty
              tax reforms, along the lines that his group suggests,. would.be a

              helpful tool to achieving   the land use goals which are contained

              in the Commission Report.     Mr. Biondi  felt that the Commission

              is not sufficiently versed    to take up  the problem of   property.

              tax valuation. Mr. Weiner     said it was  a question of   chang-ing
              our complete basis of taxation and-that     for the Commission to

              arbitrarily take a stand on    this issue would be unfair. Mr.

              Cooperson asked if there was any way that the Commission could

              make a note, since the Commission has suggested several times

              in the Report that   tax reform be considered, that real estate
<pb n="624" />

                                             21

               tax policy reform also be considered. Mr. Larson felt it

               would be wrong, at this time, to mention a s pecific tax re-

               form, such as site valuation. Mr. Weiner agreed that a res   o-

               lution by the Commission, on this.issue, is not necessary,

               however, these.ideas ought to be passed on to the appropriate

               people in State government, planning departments, etc.

                   Mr. Bradford point ed out that several statements are

               made on page 43 of the Commission R eport concerning one of

               the taxes, and he felt that the property tax may bring in    the

               second highest of the taxes assessed in the State. He felt

               that perhaps, as Mr. Cooperson. suggested, at least a statement

               that this should be studies also, should be included under

               the section on Tax Findings. Mr. Biondi said that suggestion

               would be considered when we reach that page.

               PROPERTY TAXATION,_LAND USE AND PUBLIC FACILITY FINDING

                    On page 39, Mr. Biondi pointed out the recommendation:

               "The State should study a revenue sharing formula for commer-

               cial-industrial revenue so that all jurisdictions of our small.

               State willshare in the revenue equitably." He noted that Mr.

               Conaway "raised hell with us about that." Mr. Russell., at one

               point in thpt 'hearing, tried to explain it. The Civic League

               of New Castle County did not want any part of it. Mr. Bradford

               thougl-tthat this recommendation could be included as part of

               one general section on taxation. Mr. Weiner felt that this
               recommendation says that "the Statemakes a sizable contribution

               to an Economic Development Department. That Economic Development

               Department brings major industries all into a given local tax
<pb n="625" />

                                              22

              jurisdictional area, who benefit      from that  tax area, but

              they use the State general fund      to benefit  that single area."

              Mr. Weiner further explained that this recommendation says

              that we ought to    take a look at   the equities involved.

              Therefore, Mr. Weiner felt that      the recommendation, as it

              now stands,   should not be disturbed. This,was generally

              agreed.to..

              DELMARVA ADVISORY COUNCIL AID FINDINGS

                    Mr. Slawick, at the New Castle County Hearing, said that

              if financial aid were given to the Delmarva Advisory Council,

              which covers only part of New Castle County, he felt that "some

              mechanism needs to be created to assist in stimulating the

              economy in the northern part of the-State." Mr. Biondi felt

              that the  overall recommendation, made by the       Commission, dealt
              with the  State in general.

                                            ion that   the entire paragraph under
 MOTION:            Mr  Walton made a   mot

              Delmarva  Advisory Council Aid Findings      be stricken from the

              Report.   Ms. Coffey,   representing Mayor    Maloney, said s  he felt

              that t he Delmarva Finding was in conflict with the.recoTnmenda-

              tion on  page  36, which   called for a Statewide Economic Develop-

              ment Act. She, therefore, supported Mr.        Walton's motion. This

              motion  was seconded by    Secretary Bryson   and approved by all

              present.

              'PRIVATE FINANCIAL SUPPORT FINDINGS

                    Mr. Bradford felt that the recommendation in this section

              was  meaningless, as he has stated on previous occasions. How-

              ever,  he also pointed    out that the sentence preceeding this
<pb n="626" />

                                             23

                recommendation.is misleading. It, presumably,. s ays that

                Delaware banks should have the same percentage of business

                loans as any other State for the average  of all banks in the

                Country, which is suggesting to the banks how they should

                run their business. Mr. Bradford felt that this   was not  the

                prerogative of the Delaware Tomorrow Commission. He did'not

                think an yone would quarrel with the statement "Delaware's

                Banks should be encouraged to give greater leandin g support".

                However, he felt that to tell the banks that they haveto give

                more loans to business is,"crazy". Mr. Krapf noted that he

                had voted against this sentence previously, and he would..

                note against it now. Mr. Bardford said he would present the

                position of Secretary Daniello, in his absence, concerning

                the purchase by Delaware banks of industrial bonds.

                    Mr. Weiner made a motion that the heading."Private

                Financial Support Findings" and the paragraph following    the

                heading be stricken from the Report.   However, the recommen-

                dation in this section will remain in  the report, being placed

                with the recommendationsunder "State   Financial  Inducement

                Findings". This motion was seconded by Mr. Krapf and approved

                by all preseric.

                STATE AND LOCAL PROGRAMS

                     Mr. Showalter, at the Sussex County Hearing, felt.that

                the Commission should address itself to solar power and wind

                power. The Commission felt there was no contradiction with

                their recommendations in this section.
<pb n="627" />

                                            24

                  The Civic  League of New Cas@tle County felt that the

             Com.m.is-sion should reword the sec:ond recommendation in this

             section toread: "Delaware's utility companies must develop

             a plan for meeting long and short term,energy needs for

             business and industry including i@he development of newenergy

             sources and  the conservation of present energy to the satis-

             faction of the Public Service Cornmission". Mr. Weiner felt

             that the wording the,Commission has    in this.recommendation is

             inclusive., There were-no motions to amend this     section.

             RAIL SERVICE FINDINGS

                  The Civic  League of New Castle   County said that "they

             strongly support the State doing all in its power     to insure

             continuation of the Railroad Freight Service--and we continue
             to support the constructionof the north-south toll road--

             ..as,the only viable alternative means of,delivering goods,

             people, and.services to the lower parts of the State in the

             failure of the rail   transportation  system". Mr. Walton said

             that, because the bridge went out at one time, people think

             thewholerail system "went to pot". He felt it might be more

             feasible to.build-two,rail crossings over the canal than.it

             would be  to build a toll road in the State. Secretary Hall.

             noted that   the toll road wouldn't cost anything,   however, the

             rail crossings  would cost "a bundle" and the Corps of Engineers

             would not do  it. There were no recommendations to      change this

             section, hwoever, Mr. Cooperson requested that the     editor.olf

             this report make an effort to "clean up sloppy grammer".
<pb n="628" />

                                            25

               CITY OF WILMINGTON FINDINGS

                   The Civic League of New Castle County felt that   the

               "Wilmington Wage Tax" is one of the major reasons why  middle

               and upper income people are moving out of the city and think

               that perhaps some transfer of services to thenext higher

               level of government would enable use of a tax based on a

               broader geographic area (such as a county-wide supplement to

               the State income tax). The Commission saw no reason to amend.

               this section.

               TAX FINDINGS

                    Comments were made by Mr. Williams and Mr. Lipstein at

               the New Castle Hearing. Mr. Lipstein (New Castle County Civic

               League) advocated "piggy-backing of the State's income tax

               on the Federal". The League of Women Voters said that they

               want it to be clear to all who read the Commission  Report

               that, if capital gains and personal income taxes are adversely

               affecting business location, it is because the business leaders

               are making such decisions on personal consideration.

                    Mr. Oldach said that the recommendation in this section

               simply says that we should make a study. He suggested that

               this recommzndation be amended to read: "An objective study

               of Delaware's income and capital gains.tax structur e should

               be made promptly to bring the personal income tax rate, in-

               cluding capital gains, in line with more progressive states".

               Mr. Weiner modified Mr. Oldach's recommendation to read: "An

               objective study of Delaware's income and capital gains tax

               structure should be made promptly in order to alleviate the
<pb n="629" />

                                           26

            serious disadvantage which Delaware now has in competing

            with other progressive  States for new business". He said,

            "in other words", you don't want@ to just study it, you want

            to study it in order to propose'a program of action". Several

            Commission members,expressed concern with theuse of the word

             progressive". Mr. Biondi further amended this     recommendation

            to read: "An objective study of Delaware's income    and  capital

            gains tax structure shoul.d be made promptly and   the necessary

            changes initiated to place this   State in a more  competitive

MOTION:     position with other States". Mr. Larson moved that Mr. Biondi's

            amendment to this recommendation be adopted. This motion was

            seconded by Mr.  Krapf and carried.

                 Mr. Bradford questioned whether the "piggy-back" issue

            should be addressed specifically. It was agreed that the study

            should cover  this issue automatically.

            OFFSHORE  OIL AND GAS DEVELOPMENT  FINDINGS

                 There were  no comments made  on this section in conflict

            with what was written.

            LAND USE PLANNING AND REGULATION

                 Mr. Biondi said that there   were specific recommendations-

            made on this section by the Delaware Society of    Professionhl

            Engineers. He further stated    that the comments  made on this

            issue were generally supportive. There were two other posi-

            tions expressed: 1. The recommendation that, in    the Land Use

            Planning And Regulation Section, the Commission    take a position

            that the Coastal Zone Act be included as part of    the Land Use
<pb n="630" />

                                              27

              Plan recommendations, that it remain intact in any Land Use

              Plan which is developed;   2. The recommendation that the Commis-

              sion  not advocate the retention, even as i   nterim guidelines,

              of the Coastal Zone Act (as regulatory mechanisms during the
              interim period). The overwhelming.pos    ition taken at   the public

              hearings were in favor of the recommendation as written. Mr.
  kOTION:     Weiner moved.that this section not be changed.
                    Mrs. Slights felt that the Chairman did not     paint "quite

              aclear picture of this issue". Out of 31 speakers, 9 spoke to

              the issue of retaining the Coastal Zone Act in its entirety.

              There were three who indicated an opposing     view.  Mr. Biondi

              said that there was also a majority of the     public who did not

              show up. He felt that there were three positions taken-

                    1. That the Commission recommend that the       legislature

                        and anyone else involved lock itself into the cur-

                        rent provisions of the Coastal Zone Act, as it cur-

                        rently stands,  as a necessary inclusion    in any land

                        use plan;

                    2.  That the Commission should immediately repeal the

                        Coastal Zone Act and not continue it in     existence

                        unt4I a land use plan is put into effect; and,

                    3.  The position of.the Commission and that     of the  Land

                        Use and Community Development Committee,     which is

                        spelled out in the Report.
                    Secretary Schranck seconded Mr.. Weiner's.motion that this
              section not be amended. On the question, Mrs.      Slights felt

              that the  Commission was not dealing with this question as
<pb n="631" />

                                                                        28

                     fairly as  they had:       dealt- with,       other comments made at the

                     Public Hearings.  Secretary Bryson felt that the purpose,

                     of the Statewide Land Use      Plan. was to avoid some of the    in

                     equities between the present Coastal Zone Act for the total

                     State without destroying the concept of protecting,   the Coastal

                     zone.  He said there was no point in incorporating,the    Coastal.

                     Zone Act "in toto" into a Land Use Plan. Mrs- Slights. said
                     the Commission     has    not addressed the issue. of how. we are going
                     to deal with legislation, such as,, the Beach Er0sion Act and the.

                     Wetlands, Act,.after we superced them. Many, speakers at the.

                     public hearings felt       that the issues covered in the, Coastal

                             In support of his motion,        Mr. Weiner pointed out that-

                     there were      several people who,                having read the Commission's

                     recommendation, did not come up          to,testify for or              against the

                     Coastal Zone Act, but who.             have understood that the,Commission's

                     proposal was, that: (1) the present regulations, are to remain

                     intact until a: new Plan, and new, regulations are                     developed, and

                       (2)     at that time, the Comprehensive, Statewide. Land Use Plan

                     would supercede the,          current Act., because it                 would-be a much

                     broader thing. The.              Commission's sentiment is that the coastal

                     Zone.   Act provisions, would be given due consideration.

                             Mr.  Larson felt that those ,who advocate the retention of

                     the, present provisions of the Coastal Zone       Act ought to address.

                     that position           to those drafting the Statewide Land Use Plan.

                     The Commission            is not      going to draft. the,Statewide Land Use
<pb n="632" />

                                                29

                  Plan, the State Planner will be responsible   for the drafting

                  of this Plan. Mrs. Slights said that her understanding,

                  from Mr. Keifer, of how he would determine how he would draft

                  the Statewide Land Use Plan, was that "he would go under the

                  direction of the Commission and that the Commission would

                  settle the issue and not the State Planner".     'Representative

                  Seibel said that the legislature will have the final   say on

                  what sort of Statewide Land Use Plan is implemented.

                       Mr. Cooperson felt that the  Commission,  on page 24, has

                  said tha t the people of Delaware are mature  and reasonable

                  enough to adopt measures that will continue   to protect the

                  Coastal Zone so that we will still have orderly growth and

                  development. Therefore, Mr. Cooperson recommended that Mr.

                  Weiner's motion be passed. Mrs. Slights felt that the Commis-

                  sion was doing an injustice to those who testified on this

                  issue. On previous testimony, if there was a great deal of

                  testimony against a particular issue, the Commission had voted

                  to amend the Report to comply with the wishes of the people.

                  The majority of the Commission did not agree with this summary.

     MOTION:           Mr. Weiner's motion to leave this section as written was

                  approved with Mrs. Slights and Mr. Walton voting no.

                       Mr. Conaway, in his letter to the Comm  ission, expressed

                  concern that the Statewide Land Use Plan, recommended by the

                  Couunission, not turn into merely a zoning map. Mr. Weiner

                  said this was also one of his fears and asked for clarification

                  on this issue. Mr. Larson said that the reference to the Land
<pb n="633" />

                                                30

               Use Plan in   the Industrial   section of this report is     to local

               land use plans. There were Iong discussions on this          issue at

               previous Commis-sion meetings as recorded in t     he minutes, at

               which 'time Mr. Weiner's concerns were addressed.

                     Mr. Cooperson pointed out that the third s-entence in..      the

               -second paragraph on page 45 is misleading and incorrect.          He

               felt that the demand,for land development is primarily gqnerated
               by theptivate :sector. Secretary Bryson suggested that           that

               sentence be amended.to    read: "One of the    questions being   ralsec

               now.,is that since the   State government provides financing       for

               roads, s-chools,,z-ewage disposal and other.facilities, the        demand

               for which   is largely regulated,bylocal      government lan-d develOP7

               ment decision, should the State'government take back some or all

               of  the land use regulatory responsibility it has historically

    MOTION:    delegated.",   Mr. Cooperson made a motion that Secretary Bryson         s

               sugg,.esti-on 'to change the word."determined" to "regulated" be

               ;adopted. This   motion was   seconded by,Mr. O'Donnell     and approved

               by all present.

               'COST OF  PUBLIC SERVICES

                     Comments  wer-e made on this section by the Civic League of

               NeVtCastle -County,   Mr.Drexler., the   County Executive of    New

               Castle  County, and   Mr. Williams.. In general,these comments

                                                                                         e
               were in  agreement with the Commission's position. Several peopi

               recommended that the Commis.sion go beyond what the Commission

               had recommended in terms of more specific recommendations.in the

               Report.   Mr. Biondi asked if anyone on the Commission felt that

                    changes should be               is section. It was moved by
               any                      made to th
<pb n="634" />

                                              31

   OTION:      Mr. Krapf and seconded by Mr. Ryan that this section be accepted

               as written. This motion was agreed.to by all present.

                     On the issue of whether or not the Commission should con-

               tinue in its present form, Mr. Krapf stated that he did not

               feel that the Commission should be an ongoing thing. Mr. Biondi

               pointed out that the Governor requested, in his State of the

               State Message, that when.he has legislation that he believes

               satisfies the Commission's recommendations, that the Commission

               hold public hearings on the legislation and react to the hear-

               ings, as well as to the legislation itself. Mr. Weiner supported

               Mr. Krapf's statement and also felt that his statement was not

               in conflict with what Mr. Biondi pointed out and what the Gover-

               nor has in mind. Secretary Schranck felt that there was a

               danger of this report "dying"    and he felt there ought to be

               some ongoing group to   oversee  the implementation of the policies

               suggested in this report.

                     On the subject of implementation recommendations, it was,

               generally agreed that it was not necessary for any Committees

               to meet, again.   The implementation of these.policies will be

               left to the Administration and the Legislature. It was agreed

               that the CoTaaissionwill present the final report of the Com-

               mission to t he Governor; will review and participate in the State-

               wide Land Use Process; and then the Commission will disband.

               The Governor will be putting together an Administration proposal

               with respect to the Commission's report, and submitting it for

               review to the people, the legislature, and the Commission. The

               Commission will be called to meet again to plan how to revi      ew
<pb n="635" />

                                         32

            what has been proposed, with respect to the Statewide Land

            Use*Plan, and details of the public hearings.

                 Mr. Krapf said that it had been a pleasure to serve on the

            Com mission, and that,there had.been a great many compromises.

            He felt that this is what good government is about. Mr. Krapf

            further complimented Mr. Biondi for his leadership and hard

            work on this Commission. (Applause).

                 MnBiondi   pointed out that he had not met with  the

            General Assembly on the week of January 20, as previously

            agreed to.

                 The final report, in the form agreed to at this  meeting,

            will be submitted to the Governor, the legislature,  the public

            (upon request) and the media.

                 It was further agreed that a dinner, would be arranged,

            with the General Assembly and the Governor  (dutch treat), at

            which time-Mr. Biondi would speak about the Report.

                 Mr. Biondi pointed out that it will be necessary for-.
            members of the'Commission to take an active  role in sp eaking

            to the public on the Commission's Report.

                 There being no further business, the  meeting wag adjourned

            at 11:00 p.m.:

                                         Respectfully submitted,
                                        C-3 %A a Q@

                                         Dee Burkley
                                         Recording Secretary
<pb n="636" />

                                                APPENDIX F
<pb n="637" />

                   PUBLIC HEARING ON THE DRAFT REPORT OF THE DELAWARE TOMORROW COMMISSION

                                            TUESDAY, JAN. 6, 1976

                                            CENTRAL MIDDLE SCHOOL

                                            DOVER, DELAWARE 19901

             The proceedings of this hearing,went as-follows:

             Good evening, I am Frank Biondi, Attorney at law with offices in the, City of

             Wilmington. I'm Chairman of the Delaware Tomorrow Commission.
             I would like to ident ify the-other gentlemen at the table with me- here:
             Cliff Hearn,, who's also a member of the Bar who serves as Secretary to   the

             Commission; Dave Keifer, State Planner whose office has provided the service

             and coordination for the -work of the Commission. Other members of the Com-

             mission and, its Committees are seated here in the audience, and I'm very happy

             to have them here with me. tonight. If I get into any trouble, I hop&amp; they'll

             stand up and be identified.

                 The Delaware Tomorrow Commission -was created in June of 1974, began its
             work in, September of 1974, and was charged by the Governor with certain

             specific responsibilities,. They were to determine what the state government's

             historical experience has been. in regard to growth, to determine alternative

             ways that state goverment can provide for eff ective growth, to evaluate the

             potential impact of various growth alternatives in the private and public

             sectors, and. to recommend to the state goverment policies and strategies for

             effective and rational growth in the residential, commercial, and industrial

             areas. The Commission was broken-up into three committees: a Land       Use and

             Community Development Committee, an Economic Development committee, and a Cost

             of Public Services Committee. The Committees were staffed not only by members
<pb n="638" />

                                                  -2-

               of the Cm.mi sion but by other citizens with eqxwtise. in the various areas.
               The Committees met, studied problems, discussed then in depth and made

                          ions to the Commission. The Commission then held long delibera-

               tions and decided on thp- preliminary report, which is before you at this time.

               We are going to hold this hearing tonight; there will be another hearing in

               New Castle tomorrow night and a further hearing in Georgetown the   following

               night. Following the completion of these hearings, the CamAssion will take
               the minutes of the hearings and the material submitted, sit down and.deliberate
               further with respect to the matters uhich are the subject of its report,-then

               issue a final report to the Governor, the General Assembly, and to the people

               of the State. The Commission is not so arrogant as to asm      that  it has

               suggested all of the proper solutions to the problems it has discussed; in

               facti the Commission is not so arrogant as to suggest thatit has even identi-

               fied all the right problems. We do believe we have identified some of the

               problems in the State which have to be addressed in a rational and planned

               manner. The purpose of these hearings is not to hear further from the

               Commission, but to. elicit a public response to the Commission's recommenda-

               tions. I will, therefore, ask those members of the public wiio want to speak

               to the Commission's report to come to the microphow, identify themselves,

               give their name,. address, and organization of which they are a part/or

                epresenting, if such is the case. WLw TAmts to be first? Bill Miller?

               MR. MMUZR: My rv-i--a is William J. Miller. I an the President of the

               Delaware Society of Professional Engineers, and    speak to you tonight in

               that capacity. My residence is Dover, Delaware.
<pb n="639" />

                                                -3-

                The Delaware Society of Professional Engineers Coastal Zone Committee

            has reviewed the Delaware Tomorrow Commission Report as part of our

            continued interest in Delaware's land use, management program. The Board

            of Directors endorses the comments offered.

                We commend the Commission for its, effOrts to establish a clear, set of

            policies for development in,Delaware.

                our comments are generally limited to the sections on Land Use and

            Community Development and Land Use Planning and. Regulations which we feel

            have, extreme Importance. These comments represent a continuing development

            Of  themes presented' in our March 1975 report to the Governor and General
            Assembly.,

            Land Use and Community Development

              Community        Development

                We agree with the Commission that "sprawl" should be discouraged in all,

                future development. The comission should clarify its concept   of the desired

            level of urban concentration. High density spread over too large anarea is
            obviously undesirable. population centers shouldbe limited to a manageable

            and efficient size. By designating population limits for develOPed areas,
            good utility and transportation planning can be realized.,
                Diversity Of housing types, not only high density, should be encouraged

            in the population centers. Type of housing and lot size should depend on

            the market. place, limited by the overall PLanned development density and,
            priorities for other uses.

                Redevelopment of existing older cities has been tried with varying

            degrees of success. Successful redevelopment of the core city can be

            accomplished only if coordinated with the surrounding community. Additional
<pb n="640" />

                                                   -4-

               developmenton the fringes of Wilmin                    couradd
                                                   ,gton should- be-dis   _g   so: tIA-s,-area

               can rebuild wbat already exists and not be burdened with extensive new

               facilities.

                 I We agree that decent housing is a necessity. Extensive progra     have

               been tried in the past several years often with limited success. The

               subject is much too complex to discuss in detail  at this time. We would

               hope, though, that the programs developed would very carefully examinethe

               previous successes and failures. Some limit on the number of public housing

               .units to be developed In each population center mist be established.

                   We agree that Commercial development should be zoned in clusters  and

               coordinated with planned populati-on centers, and that strip higbway

               commercial dwve@     t is undesirable. However, once areas are designated

               for cormercial development, a developer should be able -to proceed through

               the normal permit process without any additional need to justify a project.

               The ecorxx-dc risk is his and not subject to review by a             agency

                   We agree that sites most suitable for industrial development should be

               designated   Utility and transportation systems should then be planned to

                        te industrial siting. We call your attention to the fact that

               studies have been made (Fantis Co.) to determine the most suitable types of

               industry for Delaware. These studies =st be carefully considered in

               developing industrial land use policies. We would like to empbasize your

               re         im that rehabilitation of existing industrial buildings and

               sites seems a sensible approach, unless, however,  the site is no longer

               compatible with today's development plans.

                   We support the recommendation to establish tax incentives to encourage
<pb n="641" />

             renovation and rehabilitation of older properties.

                 We concur with the Commission's Utilities Finding, item #2, that "the

             routing, signing and timing of new utility installations, especially

             interceptor sewers, can be a valuable tool for, guiding land use" and

             believe. they should be. We point out that the Public Funding Recommendation.

             item #2, of not funding utility capacities beyond immediate needs is in

             conflict; it will have a negative effecton the planning process.

                 We, concur that improved mass            ion is directly tied to planned
             population centers and planned comnercial and industrial sites.   Mass trans-

             por:ation routesi must be convenient for potential users and attratt..@and-:maintitn

             these users.to, be economically feasible.
                 With planned development, utilities and:            ion can be designed

             for the maKimum anticipated use. The self-fulfilling   situation then mwks

             to our advantage - development is encouraged where planned.

                 The transportation policies which are developed should encompass all

             vehicular activity. . The reference to "cars" and "automobiles" could easily

             be expaided to satisfy this condition; in addition, it is assumed that the

             transportation policies included,all forms of transportation even if they are

             not expressly contained in the report. Air, water, and any other trans-

             portation probability qualify for consideration.

             Agriculture and Open Space

                 Maintenance of prime agricultural farm land is very ixqxwtant to assure

             food Aupply-for present and anticipated population levels. The recommenda-
             tion @O modify estate and. inheritance tax laws to assure orderly transfer of

             agricultural land is irqperative if the planned development and agricultural

             land policies are to be achieved.
<pb n="642" />

                                                   -6-

                   We support the Conservation and Open Space Policies and implementation

               measurers listed on P. 24. However, we believe public acquisition of open

               space should be limited to unique and important conservation areas and areas

               for planned park and recreation space. We assume implementation policy #2

               on P. 24 has this intent.

                   Participation in planning for the effects of off-shore drilling for oil

               and a possible deepwater terminal should and is being considered in Delawarels

               Coastal Zone            Program. The Iewes-Rehoboth Area has been given first

               priority in development of the land use            program.

               Land Use Planning, and ftulation.

                   DSPE is very pleased that the CamLission has supported our blarch 1975

               Coastal Zone Study Report, and does, therefore, agree wholeheartedly.

                   This program is now well underway under the direction of the State

               Planning Office, and -we strongly encourage the ccmplete support of all levels.

               of   VeXLLMMILIC and all

               FolIg!tt
                   The Commission's report outline many            tions and policies to

               help maximize the quality of life In Delaware. A mechanism must be estab-

               lished to implement these programs. DSPE would like to offer scme suggestions

               to follow-up on the effort to date:

               RECCM2MMON: The Governor should continue the Delaware Tomorrow Camdssion

               and its sub-ccmittees, charging the Ccmmission to review and recommend on

               specific programs to carry out the                 and policies in the report.

               RECOMMENDATION:  The Governor should assign development of specific programs

               to the appropriate departments in the State Government.
<pb n="643" />

                                                 -7-

            RFMMUATION: The Governor should assign overall coordination to the

            office which can best handle the  job for him; the Commission to serve-as

            the "watdWce' and provide the strong advisory position recommended above.

            PKER4REATION: The Land Use and Ccmnzdty Development Committee sh:)uld

            maintain close                with die- State Planning Office (a Commission

            member) and the Coastal Zone           L Committee. The development of

            the managemimt program is well undemmy and can, serve as the'nucleus on which

            to build.the other program.

            A closing comment:

                Policies eoommended by the Commission umt be carefully coordinated

            with other programs of government to determine the priorities for spending.

            Many of these          -J--4 policies should receive very high priority for

            implementation; none  should be considered as a sivple add-on to the plethora

            of existing program.

            MR. MI=: Thank you very much Mr. Chairman, and I have copies of this

            report if you would like to have them.

            MR. BIONDI: Thank you Mr. Miller. Would you please give copies to Miss

            BLwkley of the Planning Office, who is seated there in the.front, and who

            will maintain the record of the hearings for US.

                Who else-would like to speak at this time?    Is there anyone else?    Seems

            like everyone       to listen. Is there anybody   in the audience wbo would

            like to make a comment whatsoever an the Commission's report, the mmmer in

            which it is proceeding or any recoamendation whatsoever, or to ask any
            questions? You don't have to make a statement. If you want to ask any

            questions that's  fine too.
<pb n="644" />

                                                  -8-

               MR. FETTERKAN:

               Kurt Fetterman
               Dover, Delaware

                  Is the end result to encourage industry into the State of Delaware? In

               other words, in order for Delaware to overccme the anti-industry image it

               has to be very pro industry or encouraging to industry. Will this CamLission

               or report or whatever encourage industry into the area?
               MR. BIONDI: I think that's difficult to answer. What   the. Cammission. is

               talking about is eliminatir? t1ose factors, fram a negative point of view,

               which have been iuportant- deterrents to the location of uxhLstry in the

               State w&amp;ich should be eliminated, but consistent with a rational plan for

               growth and consistent with     t       of our environmental needs and also
               you heard Mr. Miller speak of one of*the.Ccmmission's reccimmendations; namely,
               the preservation of prime farm land. Our  Commission's Report is a balanced

               report which looks forward to a balanced growth in the State in the future.

               NR. FmEwm:

                  is there still entbwiasm about industry coming into the State?

               MR. BIONDI:  I don't know where it-is-I think the Commission has been

               selective in its growth recamxndations, if that's what the portent of your

               question is. If there are no other comments, yes sir.

               NO NAHE:

                  Miere can we gL-t a copy of these reports?

               MR. BIONDI: Okay, the reports may be obtained fram. the Office of the

               Delaware State Planner. I would indicate to you that the.preliminary report

               is a 53-page document which is labeled: "Draft Report of the Delaware
               Tomorrow Ccamission." If arrj of you have riot received the report yet, or
<pb n="645" />

                                                -9-

            have received it, but are not prepared to. comment on it, you may address

                                                       are State Planning Office. They
            comments concerning the report to the Delaw;

            will be distributed to members of the Commission. It is our plan to distribute

            comments made at these meetings to the members of the C=mdssion together with

            written statements made to the members of the Commission, and hold further

            deliberation. Now, as I said, the. draft report is a 53-page report. There is

            an appendix to the report 4-dch is not paged through, but as you see is four

            inches, actually it's not that difficult to read. The appendix to the report

            contains the executive orders creating the Commission, studies made on behalf

            of the Commissim,  the full report of the F=namic Development Commdttee and

            also contains minutes of the Commission meetings. We were very careful to

            transcribe the minutes of the meetings.and to make a full.record of the views

            and opinions of the members of the Commission and that is. available also from

            the Office of the Delaware State Planner to anyone who desires to.receive it.

            MR. FE77EMW:

               Maybe I misunderstand. I   thought this was supposed to be related to

            the Coastal Zone Act.

            MR. BIONDL I'm afraid you do misunderstand. The Coastal Zone Act, and the

            implications of. the Coastal Zone Act, is only one small part of the problem

            of ccmnercial-industrial-residential growth in the State. The Ummission has

            examined the patterns which have existed in the State over the last 20 years

            in.the area of land usage/community development. In my own view, the recom-

                       of the Commission in that area are of longer range and deeper

            s            in the. long run developuent of the State than is the one issue

            concerning the coastal zone. The Commission also looked at the overall

            problen of wmmmic development, and the Cammission has focused heavily on
            the problem of the cost of public servies in the State and the implication,
<pb n="646" />

                                                 -10-

                both fromthe point of view of econanLc development and future growffi and

                the quality of life of our individual citizens of  the continue@d growth and

                the cost of services both at the state, county, local and school district

                levels in the State. We are not focusing on any one   .iss ue. That issue may
                be the sexiest in the report but, in my own judgment, it is not. tlL-- most

                significant in the report. Now these are available, and I u&amp;ght also say they

                are availablewithout  charge in case anybody is worried about that. Is there

                anybody else in the audience who desires to ask any questions.or speak to the

                report?

                MR. COOK:

                H. Wallace Cook
                Newa:rk, Delaware

                    One thing that surprised me was the statenmt in yourdraft. report, on

                page 31, that in 1945 Delaware had no indebtedness and now we have over
                $500 million. I fail to see any recommendation for solving that problem.

                Are you going to make any recommendation?

                MR. BIONDI:

                    I think that the Finance and I mist, in answering these questions,

                speak for the Commission as the Commission view the problem rather than

                as I would view the problem personally. The Comnission, has looked for the

                first time at the cost of public services sector that I can find of record

                in the State at d1w overall cost in the State government to the people of

                the State. They have looked at the budgets of the three counties of the State,

                they have looked at the budgets of the major  cities in the State, and the 26,

                school districts and have  also looked at the contributions made to the public

                institutions in the State of higher learning such as the University. The

                Commission has looked at all the expenditures by these various units and the

                Commission has looked at all the sources of revenue of these various units.
<pb n="647" />

              The conclusion the Comission has reached as the result of       this analysis of

              the cost ofpublic    services in the State is that the cost of public services,

              both from the point -of view of operating expenses and from the point of view

              of debt :service and overall capital expenditurs, have reached      the point where

              they seriously threaten the economic well-being of the State and the quality

              of life of the citizens of our, State. Now we have looked at it from the point

              of view where it is necessary not only to talk about reducing

              and controlling capital expenditures and :operating expenditures at these -levels,

              but -it is also necessary to primarly take a look at the existing governmental

              structure in the St ate - both State   Government, counties, sch ool districts,,
              etc-, and to call into question the very      .structure which provides

              the services.   Are over-governed in this State., For a State of 560,000

              people,do we need all the various levels of government as          currently exist?

              In -discussing this report before another,group I was asked a specific question

              by a member of the General Assembly, andl -told that member he may have missed
              the entire point of the report because the first question which he was being
              ,asked was the validity of his own existence - of his      own office. I think that's

              the core:of -the Comission recommendation. We have not used specific numbers

              in the report because it   is extremely,difficult to project governmental revenues

              and -expenditures over a long period of time,and probably we could not get

              agreement on the Commission with respect to any single revenue source if we were

              to go and try to name a number. We know, however, that ten years down the road

              the cost of public ,services-in the State, at all levels, when added together are

              going to be substantially greater than they are at the present      time-
              absent, new sources of revenue, and the Commission doesn't recommend neW sources
<pb n="648" />

                                                    -12-

               of revenue as a way@ to go          What we recommend is that we take a look

               at the entire goverrmiental service structure in the State and decide whether
               or not we really need it as it exists at the present tin-e. But absent that
               and absent the fulfillment of other policy recommendatlons that the Com-

               mission has              in the land use and community development area and

               the economic development area, the public deficit by the year 1985 will nmke

               the current problem in the State look very miniscule. It is inherent in

               the Cbmmission's recoamendation that a more stringent approach with respect

               to capital expenditures not only for  State goverrmient but for counties, cities,

               and school districts, all levels of govenment, be adopted. Are there any

               other questions? Any other cauments?

               MR. DJ_U:

               Nonwn Dill
               523 N. Bradford St.
               Dover, Delaumre

                   I did not have time to make a prepared statement. I would like to     say

               that you would have to be against apple pie and motherhood to be against many

               of the policy recommendations which are made; however, there-are some areas

               which I am concerned with and one is that the Commission does not address itself

               to the limits  to growth in DeLaware nor bow wd will kmw   we have reached those

               limits, and it does not give us the alternative scenarios as to what our future

               might hold for us. For example, %*ot are the implications and benefits of a

               no-growth policy    Ibis is not addressed at all in the report. There are also

               some disconcerting inconsistencies and nebulous areas in the report. For

               example, some seeming contradictions: in one place we are told that there is

               too much highway development and, for example, if you take the 2% of the land

               surface of Delaware, which is already devoted to highways, and if you were to
<pb n="649" />

                                                 -13-

            take the area north of, the B&amp;O Railroad in New Castle County and find that

            fully VX of that area is already devoted to highways, then I would say we

            have too much highway in the State. Then we are told in this report also

            that we heve fallen behind in highway construction.. We are told that we

            must preserve our county planning facilities and personnel, but then we are

            told that the State. must assume the responsibility for certain "hot spots"

            such as these strip developments which have developed in certain areas of

            the State. We are told also that some decisions transcend personal and local

            concern and I would agree. On the other hand, we are told that the individual

            citizen @ we mist preserve the right of the individualcitizen to have some
            input into those  concerned. I'm wondering whether that can be spelled out

            more in detail.,  Certainly people's feelings for their land and their control

            over their property are of concern as well as the greater concerns of the

            society. I an concerned with a lack of concern in the report over the number

            one political social issue and one which may affect our next election nost

            greatly and that'is the distribution of low          housing and its relation-

            ship to the busing issue and nowhere is this concern addressed in the report

            either. I think that some concern must be given to the policy for distributing

            low income hxming so that we do,not fight this white-black scenario that we

            have before us present  in the busing issue. I was encouraged to see the recom-

            mendation that we would abandon shoring up (m pun intended there)

            the private developments along our coast. I think you should go a     step further

            and recognize that natural  disasters are, in fact, natural events.    I an con-

            cerned about the apparent abandonment as I read it of the coastal zone.provisions

            of the.,Coastal Zone Act, and I would suggest that rather than to say that the new
<pb n="650" />

               land-use policy umdd supersede the current Coastal   Zone Act, I would rather

               see that the provisions of the Coastal Zone Act should be wholly incorporated

               into a comprehensive State-wide land use planning act. I do agree that

               Delaware is too smiall to have any significant policy differences in land use

               from one end of the State to the other, from county to county, and I think

               it - s time we recognized that we are all Delawareans and that we are all in the

                    boat, and if the lawes end of the boat sinks, that it's going to affect

               those in Wilmington and Kent County as well. Thank you.

               NR. BIONDI:

                   Is there anyone else who desires to be heard? Or to ask any questions?

               Yes Sir.

               NR. HUTGHES:

               Joseph Hughes
               Farmer
               Felton, Delaware

                   Iwo           o make a few coammts concerning   the Commission's report.

               First of all, I would like to congratulate the Commiission on the foresight

               and the work that they've put into this report. It encompasses many things

               that I have agreed with for a long time and know many other people have worked

               very bard for and are much in agreement with in relation to the land-use pro-
               visions of the report. I serve on the Governor's Agricultural Advisory   Board.

               I have served my local school district for five years and  during that time

               the school district grew almost 507. becau e of change of land use. Most of

               this was in the area of strip developwmt and it had a devastating dffOCt-on,.,our

               community, on the tax base, and an the quality of life in thecommunity itself.

               These are things this report directly addresses itself to, and I think that it's

               time, as the last gentleman said, that we consider ourselves one State and adopt
<pb n="651" />

                                                 -15-

            the State land-use policy, and stop these things that are caii ing problems

            down in the rural parts of the counties. Strip development is   probably the

            biggest issue that's not covered by legislation, at least in Kent County

            because you cannot provide for a community if a farm is sold off on a

            secondary road way out in.the county and the coWlete frontage is sold,

            that becomes a coamunity initself, a community without stores, without

            schools, without, sewers, without provisions that any kind of community

            desires   it mist have to survive - and this is happening all over lower

            Kent County. I think that it's time that this is stopped and I look forw3rd.

            to the utilization of this report by our state planning authorities, and hope

            that proper legislation will be taken to implement this plan. One other

            comment that I might have in relation to land use is the fact that people still
            mist have some say in policy of land use and I don't think you can take this

            completely out of the hands of the people and certainly some exceptions mmt

            be made and certainly you cannot preclude the right of a man wbo.se bought and

            worked hard for.a fam to give a part of that   farm to a son or a daughter or

            .someone within his family. I think that certain provisions mist be made this

            way, but if right now just in Kent County alone, and this is the only county

            that I can really relate to on this problem, if we pull our laws into line

            with the counties around us in Maryland and Delmare we wouldn't have half
            the problem we faced- in the Lwt-"five@@-years,.--wikh randcu.,arid!,scattered --dev6lop-
            ment. on top of that, if just the septic tank regulations were enforced,.which
            is a f@mction of the State Water and Air Resources Commission, if these people
            were to have enforcement details that would follow up on their regulations

            .that they make,and believe me are not enforced, then a lot of the random and
<pb n="652" />

                                                        -16-

                assorted development that we are getting wmdd not have happened in the           first
                place.   So I'm Aaying that, with few exceptions, allthese projections,          all
                these idealsthat are put forth in land use in your report could be brought

                into play very easily just with enforcing Lm that we have and adding a few

                mcwe regulations that are needed. I personally believe that I'd like to see
                a step toward less government than more and I think that you're talking along

                this line and I commend you for it. Thank you.

                MR. BIONDI:

                     Thank YOU Mr.. Hughes. Is there anyone else who      desires.to be heard?

                M. BOGUS:

                Billie Bogus
                Ulyc@,    DeLmm.re

                     I guess I'm going to probably raise a complaint. I came to the meeting

                tonight anticipating an explanation of the report or having a copy of the

                'report read so that I could ask questions about a      specific strea.  There are

                quite a few of us here we have not gotten copies.       Weire really sitting in

                a vacuun. I sort of understood this was an opportunity for the people to

                speak. If we haven't gotten,the information how,canwe speak to it?

                ML BIONDI:

                     We attempted to secure a wide distribution-of the Cannission's       report

                and  to advise people through all of the elements of the medi      a of the hearings

                and of the availability of the report at the Delaware State Planning Office.

                If you have not bad access to a copy of the report, we will make a copy of it

                available to you if you want. If there is anyone here this evening who desires

                a copy of the report, who has not received it, following the conclusion of the
                meeting, give your name and address to Miss Burkley of the State Planning Office
<pb n="653" />

                                                      -17-

              and we will see that you get a copy and the Commission will not close its
              record in these matters until people     like you have bad an opportunity to

              comment to   the Commission concerning the report

              MRS. BOGUS:

                                              Will there be   further public hearings    after members of the public have

              :made their commemts?

              MR. BIONDI:

                  We hadn't planned further public hearings( after the one  tomorrow night

              and the one the following. night; however, if they are necessary we will

              call for me. They could be scheduled but we will accept  any comments
              you may add in writing. to the State Department of      Planning and we will   then

              distribute-- them to all members of the Commision.

              MRS. BOGUS':
                  Yes, I heard earlier.     May I ask what fom of distribution was taken with
              these reports?   I personally saw no mention of the reports      being available
                               Now if they were distributed, -to whom were they distributed?
              to the public.

              MR. BIONDI:

                  Copies  of the reports were distributed to many organizations                     in the

              State: civic organizations, public affairs organizations, many of these

                  organizat ions  received letters indicating the nature of the report, the time,

              of the, hearings, the place of the hearings, and they were told they could

              secure copies of the report. To the citizenry       in general,  the people who
              ,aren't members-of organizations, it was done in the usual fashion
              media, and news stories,   things of that kind.

              MRS. BOGUS:

                  The taxpayer,   the individual,   was somewhat overlooked.
<pb n="654" />

                MR. BIONDI:

                   Well, I think it's difficult unless you have a mailing to everyone in

                the State to get this kind of information out.

                MRS. BOGUS:

                   Yes, I realize this but may I suggest that at future hearings reports

                be available ahead of time at.the night of the meeting so,that those of us

                vft are interested can at least scan it and have some notion as to what we

                would like to question.

                NR.-BIONDI:

                   Yes ma'm.

                   Is there anyone whio desires to speak or to be beard concerning the

                report or make any comments either at the report or at the procedure?

                Yes six.

                MR. SBIELDS:

                Jerry Shields
                Dover, Delaware

                   I got here a little late so I didn't get the benefits.of the comments

                made previously; however, I do want to comlowts! based on talking to hundreds

                perhaps thousands of people up and down the State, that the Dela@ware Tawrrow.

                Commission FWport include "in toto" and intact, the written version of the 1971

                Coastal Zone Act. The Coastal Zone Act was a good idea in 1971 and it is a

                good idea now. Cur coasts are being threatened now by the incursion of oil  and

                gas related itAistries. I don't think there's any doubt.that plans are being

                made to gradually build up the southern coast of Delaware as an iYuh, trial-

                commercial complex. This Won't happen next year but it is in the planning stage,

                and I think the people of Dela:ware have the right to prevent this, if they can,
<pb n="655" />

             to have.a. say so in what exactly happens on their coast. We. presently have

             the law on the boo.ks. This law, a State law, is our protection. If this

             law is done away with and provisions are made which weaken the protection

             of the coast and set up zones for heavy industry along it, we will eventually

             have.incursions all up and dam the present area that-is designated for fish-
             ing,and tourism. The Coastal Zone Act gives us protection - protection'!

             guaranteed by theTenth Amendm   ent of the Constitution from passage of laws

             by the Federal Government telling us what can happen up and down our coast.
             I wouid recommend very strongly and I think there are many, many people in

             the.State who do agree with me that the Coastal Zone Act be retained in its

             present form and incorporated.into the Delaware Tomorrow Commi sim Report.

             'Thank you.

             MR. BIONDI:

                 Thank you Mr.  Shields. Is there anyom else wto desires to be beard?

             Ladies,-and gentlemen thank you for your attendance here this evening and to

             those,of you who have not had access to copies of the Report, I would appre-

             ciate it if you would cane forward and give us your rme and a          s so that

             we may. make those copies available to you. Thank you.

             Attaidance   approdmately 95.
<pb n="656" />

                     PUMIC HEARIM ON THE DRAFT REPOR!r OF THE DELAWARE TCMMROW CCt4-MSSION

                                             WEDNESDAY, JAN. 7, 1976

                                             WILLIAM PENN HIGH SMM

                                               NEW CASTIZ, DELAWARE

                MR. BIONDI:

                   Ladies and gentlemen if we may call this meeting to order at this time.

                I an 0. Francis Biondi, Chainaan of the DeLware Tomorrow Commission. Seated

                to ray left are Cliff Hearn, Secretary to the Commission and Dave Keifer who

                is the Delaware State Planner and whose office has the coordinating role in

                this effort. This is the second hearing held by the DelawareTbimorrow Com-

                mission. The first hearing was held last night in Dover. The Commission

                was created in June of 1974 by Governor Tribbitt and began its uork in
                September of 1974. The objectives of the Chiimission were to eamine problem

                and policies in this State with respect to growth, to recommend pol icies to

                the State Government which would accammdate growth, and take into account all

                the relevant considerations. The Commission has functioned mt simply as a

                Commission, but also through three committees. The 31 members of the Ccamission

                have functioned through a Land Use and Community Development Committee, an

                Economic Development Committee, and a Cost of Public Services Committee. Each

                of these Committees was staffed both by members of the Commission and by members

                of the general public who were not members of the Commis sion. Each of these

                Committees had nine to thirteen people %ho were not members of the Commission

                itself, but who were members of the general public who had expertise in the

                area that the Committee was charged with studying. Staff to the Committees

                was provided through a federal grant by various personnel from varu= depart-

                ments; from the University of Delaware., The Committees met, debated, presented
<pb n="657" />

                                                  -2-

             a report-to the  Commssion. Each Coomittee presented a separate report to

             the Commission.   The Commission then met and debated, debated, debated, and

              debated the Committee reports. The document that is before you is a prelimi-

             nary,report of -the Commission -in term of 53 pages, fairly tightly written.

             Each comma has been purchased at a very high price,I would say. At this

             time it is not my purpose to review the Commission Report. If there is.

             anyone in the audience who has  not received a copy of the Commission Report

             who wants one, there are,several more left here on the front table. Our

             purpose:here tonight is to see what the,public reaction is to the report   and,

             to secure additional input. Following the hearing, it is our intention to
             night"s  hearing,will be, and to distribute to members of the Commission. The

             Commission will then meet again and deliberate as to the input it hasreceived
             through'these hearings.We will then issue a final report to the Governor
             and the General Assembly as far as the recommendat      ions of the Commission -are
             concerned. I want to say at this time(as I have said an other occasions)

             that the Commission,is not so arrogant as to believe it has suggested all

             the right answers. We may not even have the right questions.      The questions

             we have raised we  think are relevantsubstantive and deserve     serious attention.

             I_am going to open the floor up for public discussion, and in no particular

             order anyone who wishes to speak will be recognized. We're not going to pose
             any official limitations on'the.length of anyone's discussion. We hope,

            everyone.will be reasonable and when you come forward, please give your name,

             addres,If you represent an organization or are associated with an organization,
             give the name of the organization, and if you have any written materials you
             would ..,,like placed in the record, leave them here with us at the head table.   Who
<pb n="658" />

                                                   -3-

                would like to open the discussion?

                MR. DEHAN:

                Oliver E. Deban, Director of Planning
                Wilmington Medical Center
                1 Warren Lane
                Wilmington, Delaware 19808

                   I do have a statement which I want to read  from the Wilmington Medical

                Center concerning its reaction to aportion of the report of the Delaware

                Tomorrow Commission.

                   In its draft report the Delaware Tomorrow ConurLssion discusses, among

                many things, '@kjor Institutional Land Use Findings." It states that major

                institutions often "operate outside the framework of municipal, county and

                state planning and decision-making to the detriment or disruption of the

                Comm[Zlity.11 It further points out that the decision for the site location

                for the proposed suburban unit of the Wilmington Medical Center is an

                example of "the lack of          tion and coordination between major insti-

                tutions and the communities they serve."

                   We would like to point out, for the record, that the Wilmington Medical
                Center, has worked, and continues to work closely, with the New Castle County
                Plimmung Department over the past 3--veral years during which time it has been

                considering the location of some type of medical facility on a 200-acre site it

                awns in Stanton. It worked with the County in 1970 when zoning was sought and

                obtained for location of a hospital an that site. A 1972 study co-sponsored by

                the New Castle County Pl=dx)g Depart@ment, the Greater Wilmixgton Development

                Council and the Wi1ndngton Medical Center indicated that sewer capacity,

                water supplies, and electrical services would be available at the Stanton site

                sufficient to support a 1200-bed hospital, Delaware Technical College, and

                other development s in that area. It has worked, and is working closely with
                the local and State Health Planning Councils during preliminary development

                of its plan to construct an that site a major hospital center.
<pb n="659" />

                                               -4-

                Iater this month the Medical Center will fonmlly submit its proposal

            to the Health Planning Council and the State Interim Ccuprehensive Health

            Planning Council, which will hold, two public hearings before making a final

            decision to accept or reject that proposal.

                At the same time, the County will bold bearings on the project under the
            DPLID (Diversified Planned Unit Development) procedures. The Wilmington'

            Medical Center is now working outside the framwork of planning and decision

            making.
                The Delaware Tomorrow Ccmission report expresses concern about the'

            burdenthat the development of the Stanton site might impose on the County
            and the'State. However, the selection of the site in 1969 was largely1hflu-

            enced by existing road and utility patterns plus those that were already

            planned. Our consultants have told us that the cost to the public, to the

            taxpayer, will be minimal.

                In addition, if one looks carefully at the record, Wilmington Medical

            Center, in great part through its.endomment income, makes a significant

            annual f irmncial contribution in caring for patients in, Wilmington, New

            Castle County, and the State for whom m one else pays. The Center thus

            supports the indigent citizens of the State of Delaware in an amcxmt approxi-
            mately $4 million dollars, financed largely through erkkument and higher

            charges to paying patients and other third party agencies.
                None, of the facilities of the Wilmington Medical Center fully ccmply

            with federal and State standards for health care. Failure to bring itself

            into ccrapliance Mans that the Center risks the possibility of losing

            acc.reditation by the Joint Commission on Accreditation of hospitals, and
<pb n="660" />

               coincidentally with that loss, the loss of certification by the Social
               SecLwity Aadnistration as a Medicare hospital and the loss of approval 'of

               the several education programs that currently provide most of the physicians

               and health care professionals for the State of Delaware.

                   The plan which the Wi1mington Medical Center proposes is being processed

               through the planning and decision-making bodies at seve ral levels. It will

               minimally impact on State government or the taxpayer for support, and is

               the most cost-effective of all plans'considered.

                   In addition, this Plan will assure New Castle County, the State of

               Delaware and surrounding areas of the facilities necessary to provide

               quality hospital care well into the 1980's and beyond,

               MR. BIONDI:

                   Thank you. Next?

               MR. LIPSTEIN:

               Gene Lipstein
               704 West Matson Ran Parktray
               Wilmington, Delaware

                   I'm speaking on behalf of the Civic League for New Castle County who

               has been. studying planning and the Connission reports quite a long time.

                   The Civic League has always recognized the difficulties of long-range

               planning, particularly when implementation of decisions are made by others

               than those vft do the planning. We, therefore, feelthat the policy goals

               f6r the Delaware Tomorrow Ccmnission to achieve at all levels of Government

               should be:

                       a. Flexibility of government  actions to provide necessary services

               when needed.
<pb n="661" />

                                               -6-

                    b. Cooperation between and among various levels of government.

                    c. Attraction of semi-skilled,and bighly skilled employment

             opportunities into,our State.

                    d. Retraining existing unemployed people and urAeremployed
             people' for higher level jobs.

                 We feel that the appointment of the Delaware Tomorrow Commission was

             a major "first" step forward; that growth policy-is not.a "one-time" thing

             that can be disposed of by a Com@ission report    therefore we would like
                                 tence of this Comaission or some likergovernmental
             to see continued eXIS

             agency like this.

                 The Civic League agrees with the Comnission that the urban growth of

             the 1950-1965 period brought enormous problems. Reaction and over-reaction

             created serious economic problem which citizens of Delaware must now face.

                 We agree, in general, with most of the Commission's policy recommenda-
             .tions, but we would like to comment an some and make          tions for
             revision of others. We will take them in the same order as they are pre-

             sented in the report.

             LAND USE AND OCRI= DEVEIDPMW

                 Civic League has, long encouraged, and continues to support, the "cluster

             concept" of development for most economical use of land, utility networks,

             etc., as well as a sens.e of."commmity"    lost in the unstructured growth

             of the 50's.

             Transportation Policies

                 Civic League agrees that transportation policies should be concerned

             with the people and goods, not just the movement of cars. To this end we

             believe that '@mss transportation!' should be used where it is economically
<pb n="662" />

                                                 -7-

              feasible but the subsidy of mass transportation should only be for capital

              inpravements, and mass transportation service should be restricted to those

              routes whdch can operate on income provided by fares.

                  16Jvote indeed surprised at the lack of a recommendation for the

              Department of Transportation to MCOMPass land, sea, and air     much like

              the Port of New York Authority. We d-dmk that such a quasi-public organi-

              zation might even be self-sustainingl

              utility Policy

                  Me do.not agree that new capital investment in utility systems (and
              connection of the ekisting systems) should not,be made, but we do believe they
              should be cost-justified in terms ofInmediate service, (e.g., Sewers, etc  "  should
              be built forneed within the five-year capital budget, rather than a 20-year

              projection.)

              Agriculture and Farmland

                  We support the protection of "prime farmland" but we question the

              definition and inclusion of lands classified as 1, 2, and 3. Rather we think

              we should base our protection on what we wish to achieve. Is it to provide'

              food? If so, our crop product is J.Psignificant natimwilly;.we need only to be

              concerned with that farmland which provides the crops for local needs. Are

              we trying to keep open space? Is it for buffer zones? Is it for conservation

              measures, or for protection of the aquifers? Each of these has a specific

              need but.is not necessarily tied to the productivity 2f the land or the type

              of soil.

              Conservation and Open Space Policies

                  Civic League has supported the Coastal Zone Act as a necessary interim

              and emergency measure. We continue to support it, modified to allow incb tries
<pb n="663" />

                                               -8-

            to move ahead with due regard to environmental protection. We think that

            Delaware must balance the use of its resources for both its industrial and

            its recreational needs.

            Residential Land Policies

                Insofar as the Ccaraission-stated policies go, Civic League does agree
            that housing is, a necessity. We question the use of "adequately housed"

            in both the second and third policies unless the word "adequately" is

            defined as. 'meeting the minimum standards of a housing code," which Delaware

            should havel

            Ccumercial Land Poligr

                Rather than curtail comercial strip development, we should require

            parallel local roads with limited access, to our main highway network. Such

            a policy would meet.the criteria for clustering highway oriented uses rather

            than stringing them along the highways.

            Industry and Industrial Land Use Polic'

                We find in general, the stated policies as desirable. We do question,

            however,. the fact that it is not recognized that if a site fits. all other

            criteria but is contrary to land use planning, we must presumethat theplan

            might be at fault and so should consider revision of the plan.

            ECOMUC MUM=

                Recent headlines'have made us aware that the State can no longer

            continue to defer expenses by capitalizing operating costs. The City of

            New York learned this with sorrow, mid Delaware must realize it before it is

            too late.

                We have some serious questions about revenue sharing of property tax

            revenues. We are disenchanted with the Federal revenue sharing procedures
<pb n="664" />

                and believe that the authority uhich spends the money should raise it.

                There is a loss of accountability when the spending age  ncy is not required

                to answer to the public for the funds raised.

                State and Local Programs

                   We question that the State Government mist develop a plan for meeting,

                energy needs. We.would like to see that reconmwidation. revised to read

                "Delaware's utility companies must develop a plan for meting long and

                short term energy needs for business and irxbl      including the development

                of new energy sources and the conservation of present energy to the satisfaction

                of the Public Service Commission."

                Rail Service F

                   Acting on behalf of all. the citizens in the State we   strongly support

                the State doing all in its power to insure continuation of the Railroad

                Freight Service    and we continue to support the construction of the north-

                south toll road    as the only viable alternative means of delivering goods,

                people, and services to the lower parts of the State in the failure of the

                rail transportation system.

                City of Wilmington Findings

                   We strongly support the   implementation of thereccmmendations of the

                Port of Wilmington ccmittee. We thim we have already suffered too long a

                delay. We. feel 0,7_t: the Wilmington wage tax is one of the major reasons why

                middle and upper income people are moving out of the city an  d think that per-

                haps some transfer of services to the next higher level of government would

                enable use of a tax based on a broader geographical area (such as a county-wide

                supplement to the State income tax).
<pb n="665" />

                                               -10-

            Tax Findings

                There is no doubt that. the people who make the decision s. of where to

            locate a plant are prone to look askance at Delaware's upper personal

            income tax rate, and its 100 capital gains tax. Civic League believes

            that- true, "piggybacking" of the State's income tax on. the Federal. (with

            collection for the State byIRS) would be beneficial and that.any loss

            to the State by taxing, capital gains at half rate would be more than offset

            by the economy of using the Goverment's collection service and the advan-

            tages to be gained by-the more favarablebusiness climate.

            Offshore Oil and Gas Development Findings

                The State must participate in planning for offshore drilling so that

            we can prepare and cope with any onshore impact.

                The-question of offshore (deepwater) oil-unloading facilities is a

            separate one. Since  the Delaware River bi-state compact precludes Delaware

            from building and operating such a facility on its own, perhaps the best
            approach would be for the State to own a pipeline and let the loading facilities

            be privately owned under permit so hat the State could exercise suitable

            controls.

            LAND USE PLANNING AND REGULATION

                The State Goverment. (as the highest level of govermentt) must  coordinate

            land us e plans of the lower levels of government particularly as such plans

            impact upon the fiscal needs of the State. It is necessary for advance

            planning to be made not only for utilities, highways, and other intrastructures,

            but also'for the wherewithall to finance then.
<pb n="666" />

                                                    _10-

                 COST OF PUBLIC SERVICES

                     There is no doubt that the demm-d for services at all levels of

                 government have outrun the ability to pay for then, and raising taxes to

                 balance income to the cost of meeting these demands would prove to be an

                 onerous taxation burden upon the populace. It will become necessary,

                 therefore, for priorities to be established, and those services which are

                 not cost effective and for which there are no finances available must either:

                 be deferred or canceled. The objectives must be to deliver the essential

                 services in an efficient and cost effective manner.

                     We suggest that the reccmmendatim for elected officials at all

                 levels of government to irdtiate a coordinated, cooperative, comprehensive

                 review, etc., be supplemented with the requirement that the Governor (as

                 the highest elected official of the State) be responsible to ixdtiate such

                 a study; to implement the recommendations; and to call an lower levels to

                 do li1wAse.

                     Throughout the report there are evidences of a desire to use tax

                 incentives to attempt to move the private sector in the desired direction.

                 Civic League, in principle, opposes tax benefits on. the premise that any

                 benefits received by one taxpayer is at the expense of all of the others.

                 We also feel that direct subsidy is more advantageous than tax preference

                 because it 'Iiighlights" the true cost.

                     However, in the very special case of real property taxation, a "tax-break'

                 In early years might conc-eivably result in the addition of assessable

                 property to the rolls in later years. Local governments (tbose which rely

                 most an property taxes) might do well to take a bard look at "site valuation"
                 taxes    wherein the land is assessed at its best use     (and the improvements
<pb n="667" />

            not included in the assessment) as  a means of stimulating

            Improvement wt&amp;ch require governmental services (fire protection, special

            equipment, etc.) could be charged a "fee@' for services in lieu of the

            property tax.

                We reiterate that the appointment of the Delm%Tare Tomorrow Commission

            and its initial report are but a start to the ongoing problem of coping

            with the changing conditions in our State, Country, and the world. The

            problems cannot be solved by a Commission report but are constant and

            recurring and must be "coped with!' m a continuing basis. We, therefore,

            suggest the Commission recommend that a small group be constituted as an

            ongoing advisory council which should update findings and              ions

            on at least an annual basis..

                Although the Commission specifically did not look at government

            structure, we recommend that the ongoing council be directed to study

            changes in.structure and recommend those changes which might be cost-effectivel

            Thank you very much.

            MR. BIONDI:

                Yes, thank you.

            MR. NELSON:

            Frank Nelson
            20 Kilo Road
            Newark, Delaware

                I'm co-Chairmen of a local citizens  group that's kimm as the Land Value

            Tax Committee of Delaware, and we are very much interested in property tax

            reform and think it's a desirable goal and  I can't tell you, Yx. Lipstein,

            how pleased I am to find a Civic League making a recommendation for property

            tax reform. We happen to think that property tax reform could be a most
<pb n="668" />

                                                     -12-

                useful, if not an absolutely essential, tool In helping to achieve the land

                use goals contained in  the Delaware Tomorrow Ccnnission. Report.

                    Something seems drastically wrong with our existing property tax system

                that seems to actually prcmote the very ills the   Commission hopes  to cure.

                Abandoned, boarded up, and decayug city dwellings, penalities for     fixing  UP

                and enlarging one's home, the exodus from the middle class    cities,and the

                expensive waste limit of suburban sprawl. The Coamission's     report certainly

                indicates their awareness of the problem as their recommendations included

                special tax relief, tax incentives to help reverse this harmful trend. Our

                Committee firmly believes that a more permanent and effective form of tax

                incentive would be the property tax reform that would provide permanent tax

                incentive and that would provide reduced taxes on   mprovements while increasing

                taxes that are derived from. the location values of  the land frcm which the

                improvement is built. With that disreform., the conditions of our cities may    I

                continue to deteriorate no matter wimt is resolved and no matter what aL unts

                of money are expended and public efforts to rehabilitate them. On property

                tax, consider for example how reduced taxes on. such desired improvements as

                hcmes, ppartments, job-producing business, commercial and industrial structures

                would provide strong incentive for greater numbers of new, high-quality build-

                ings, and equally important, the rehabilitation of older, deteriorated structures.

                Reducing this tax bounty on Improvements would help save our existing housing

                stock from sliding into disrepair. On the other band, higher taxes an urban

                land itself would help insure the locations needed by the ccmmnity would likely
                be put to 'their highest and best use. This would greatly aid real urban land

                conservation. Much eaphasis is gWen on protecting the outer op     en spaces. Just
<pb n="669" />

                                                -13-

            consider that really our city and town land resources that are severely limited

            are much too important and valuable tobe wasted for board-up structures,

            blighted-buildings, vacant unused sites,and for the ever-proliferation-of

            surfaced.parking lots.

                These higher taxes on urban land values, whether achieved through more

            realistic assessments of market values, or by higher tax rates on the land

            than on improvements, would also help insure that growth and deve1gmmt

            would occur primarily where supportive. services already exist. For it is

            these very services that  make such locations desirable and mst valuable.

            The land tax would also help discourage any speculative withholding of land

            'from the market.

                Thisbetter utilization of community and perimeter location could then
            enhance the prospects for preserving outlying green fringe and farmland areas,

            by lessening leap-frog development that cm, es suburban sprawl.

                On another note, there is a good possibility that the construction costs

            of the much desired mass transportation systems of the future might be

            financed in their. entirety by the taxing of the increased land values thus
            created adjacent to these facilities. This may sound like perpetual motion,

            but studies showthis to be feasible; for example, the San Francisco-bay

            area which is presently studying a proposal to finance the Bay Area Rapid

            Transit Systen by just such a method. Studies have also shown that the

            facilities that have been created around New York City;.bridges, highways,

            tunnels, are going to lead to higher land values around them that greatly

            exceed the cost of those facilities. How to accomplish such tax incentives?
            Other.cities and States that move in this direction: Pittsburgh, Scranton,
            Harris burg, Arlington County in Virginia for example, have taken very pro-

            gressive mDves in.the direction we have been speaking of. Just last November
            the Indiana State legislative Council heard testimony outlining a study of
<pb n="670" />

                                                  -14-

               suggested ways by which Indiana cities might introduce such land tax

               incentives, and the study was adopted unanimously. We  suggest that Delaware's

               Legislative Council look into a similar study; one that could play a vital role

               in helping to achieve Delaware's goals for tomorrow.

                   Our Coumittee certainly would be mst happy to participate in such an

               effort. Thank you, Sir.

               MR. BIONDI:

                   Thank you Mr. Nelson.  Who would like to speak next?

               MR. STAZESKY:

               Richard Stazesky
               2200 Market Street
               Wilmington, Delaware

                   I'm speaking for the Citizens Housing Alliance of Delaware (CHAD).

                   CHAD would like to commend the members of Governor Tribbitt's Delaware

               Tomorrow Ccamission for preparing a challenging report on,grawth policy

               options for the State of Delaware.

                   Since CHAD is a citizens housing advocacy group, we would particularly

               like to address our camments to the Land Use and Ccmnanity Development and

               Land Use Planning and Regulation sections of the Report.

                   We would like to endorse the four Residential Land Policies as stated

               an page 25 of the Report. To see these policies implemented, it will be

               necessary to give particular and prcapt attention to the third policy:

                Delaware should crange its housing and land development control regulations

               so as to modify those laws that inhibit rather than encourage the provisions

               of adequate housing, and to provide for consistency among regulatory agencies

               at the several gaverriment, levels."

                   As stated in this report, the economic and energy realities of our time
<pb n="671" />

            mandate that detached housing on large lots can no longerbe the accepted

            standard for housing most of our population. Some  of our restrictive zoning

            practices will have to be modified to accomnodate the housing needs of our

            State population.
                Consistency of regulations dealing with land development control of the

            several government levels would greatly enhance the possibilities of efficient

            and orderly development. Current regulatory practices impede, slow dimm,

            and increase cost of housing.

                We strongly support the recommendation of the Commission that an

            eq3anded State Housing Agency should be supported, given power and encouraged

            to use state financing to supplement federal programs and support local

            housing efforts. States which currently have well-staffed State Housi

            Finance agencies have been successful in helping to meet the housing needs

            of their constituents and to take advantage of federal housing dollars as

            they become available. With the current emphasis on the new federalism, it

            is essential that Delaware's State Housing agency increase the sophistication

            of its, operation to enable it to give leadership in the housing field.

                We endorse the development of a. State-wide land use plan. We urge that

            such a, plan, developed in cooperation with local jurisdictions, include

            specific provisions for securing land that would be used forhousing of low

            and mqderate income families. Great care should be taken in allotting such

           .land an a fair share basis to avoid the creation of new ghettos and help
            relieve Wilmington of carrying the averwhelmirig       of contimLing to
            house most of the State's indigent population.

                Though we are cog=ant and eager to preserve our environmental resources,
<pb n="672" />

                                                   -16-

               a State Land Use Plan mist balance the social and economic needs of our

               people. Preservation of the environment and satisfying economic and social

               needs should not be mutually exclusive objectives.

                   Since CHAD has assumed as one of its major responsibilities the

               monitoring of the Federal Housing and Ummunity Development Act of 1974,

               we have some comments and recommendations which we feel are relevant to

               the Commission's Report-

                   This complicated legislation calls for a high level of multi-jurisdict-

               ional and multi-agency  cooperation in order to succeed in its stated goals of

               "development of viable communities by providing decent housing and a suitable

               living mvirona-ent and eTaiding economic opportunities, principally for

               persons of low and moderate income." These conditions of cooperation, from

               our observation, are not adequate at this time. The State will be receiving

               increasing amounts of CD moneys in coming years. New   Castle County alone.

               will receive $1,576,000 in fiscal  1976, while Wilmington will receive $4.1

               million. Non-metropolitan areas received $483,000 in 1975 and this amount

               will, in all likelibood, increase in the coming year. We are convinced that

               to secure the necessary inter-jurisdictional and inter-agency,cooperation to

               make the program effective, those charged with administration of CD funds in.

               the State will have to have a clear mandate from regional executives, the

               Governor, and elected governmental bodies that the program be administered

               cooperatively if crar total camM=ty is to be served.

                   This matter demands vision and leadership from our elected officials at

               all levels of state government. We urge that they.direct immediate attention

               to this problem.

                   Yx. Francis Bia-idi, Chairperson of this Chnission,  indicated.at a recent

               forum discussion of this Report that much of Delaware's  government structure
<pb n="673" />

                                               -17-

            has been a historical accident. Population growth and increased demand for

            quality services, including housing for all Delawareans, indicate that it is
            time that de.livery of services be re-examined and reorganized and priorities

           .be set to ueet current and future needs. If this is not.done, indications

            are that the State will be in deep financial.trouble.

                In line with this reasoning, we suggest that the Commission members look

            carefully at the cost and efficiency of the operation of several separate

            Housing Authorities and Planning Departments In an area the size of New Castle

            County. Findings of  such an investigation might suggest the advisability of

            some consolidation of efforts in this area.

                We urge that the major recommendations of the Delaware Tomorrow,com-

            mission relating to Land Use and Czm=dty Development and Land Use Planning

            and Regulation be promptly adopted by the Governor and the General Assembly;

            that Coxmission members be given the mandate to begin immediately to uwk on

            implementing the poll             tions contained in the Report. The
                                icy                                                problem

            needing attention and solutions posed by this Report are complicated, but

            Delaware is fortunately small enough that positive support and leadership from

            our elected officials and concerned citizens can make Delaware Tomorrow happen.

            Thank you.

            MR. BIONDI:

                Thank you Dick.

            MS. RITA RMH

            Rita Smith
             Leamie of WomenVoters of Delaware

                I'd like to give a summary of the statement prepared. The League of

            Women Voters of Delaware would like to commend the Delaware Tomorrow Commission
<pb n="674" />

                                                  -18-

               for all the bard work and long hours invested in their report. We are in

               agreement with many of the policies included. Our specific, camvmts follow:

               CMELMity              Pattern

                   niee Leagm is particularly enthusiastic about the statements urging

               development in already existing centralized area with an eye toward::

                       1. &amp;xUng urban sprawl.

                       2. Facilitating use of mass transit, and

                       3. Revitalizing urban communities.

                   With this support in mLnd, we are seeking some clarification.

                   Regarding "available capacity" mentioned m page 18; what type of

               program does the Commission suggest to encourage nxnmment into existing

               housing? What incentives or disincentives is the Ccmission suggesting    to

               counteract relocation from existing housing to areas of new housing?

                   If a relocation of the publicschool population were to occur such

               that empty classrooms existed in one area, does the CamLission mean that

               the State should withhold capital funding for new classrooms elsewhere?

                   Virtually all of the recommendations involving housing and anti-sprawl

               focus on incentives and othe r policies which would involve expenditures of

               public funds. We found no recommended economic pressures or penalities to

               actively discourage -- or make significantly ume.expensive      development
               in low-density situations. Given most people's apparent preference for

               suburban style lt.-Lrg, it is unrealistic to expect then to choose housing
               other than that if there is not a significant economic difference. Our

               understanding is that installation of private septic systems is not more
<pb n="675" />

             expensive than paying (through the price of the house) for an already installed

             sewer system. Although the latter costs the rest of the coammnity nothing,

             the former frequently results in- later "catch-up" public investment.

                A similar "catch-up" situation can occur wiien extensive development

             occurs along existing roads in land zoned general purpose and agricultural.

             Half-acre or one- acre lots can be developed on such land with no rezomb*,,,

             necessary. Eventually, the existing road needs to be upgraded to handle the

             increased traffic, at cost to all taxpayers. Higher density development, at

             least in New Castle County, is required to provide all.its own interior roads,

             the cost being added on to the cost of the bowing. These factors seems to

             provide a cost incenti: ve for sprawl, rather than the reverse.

                The Commission's emphasis is on incentives (presumably publicly financed),

             with no.mention of deterrents, and yet the section on cost of public services

             paints a bleak picture of revenues vs. CURMU program expenditures -- exclusive
             of any added incentive p@rqgrams. We would like the Commission to clarify what

             seems to be an inconsistency in recommending clustering incentives and keeping

             cost.s.under control, perhaps by inc-luding.a discussion of deterrents to low-

             density development.

             Transportation

                We concur with  the findings and policies, and particularly support the

             empbasis on mass transportation and utilization of existing roads. In addition,

             we would like to see some specific recognition of the impact of new roads on

             development, along with a recommendation that sucb new roads be located in

             conju,nction with the Ccamission's other priorities   that is, non-sprawl

             (WW101113ent, J=WIET-Ving f 11.13:1111,al:e, etc.
<pb n="676" />

                                                  -2o-
               Agriculture and Farmland

                   At the beginning of this section, the Connission appears to want to

               protect prime farmland and discusses reasons for and benefits from such a

               policy. Subsequently, in the middle of page 22, it states that Delaware

               should "preserve!' as well as "protect" prime farmland. The report then

               refers to several methods of "protectine' such lands. We would like to

               see the tenns "preserve" and "protect" defined more specifically. It is

               our understanding that farmland assessment is a policy which makes it

               economically feasible for the landowner to continue fanning but which does

               not constrain him fran applying for a rezoning if he so chooses. In fact,

               his land may already be zoned for development but kept in fanning and

               assessed as farmland. Does this constitute "preserving or "protectingil?

               Vft= the Ccamission reconmends preserving or protecting, does it have any

               number of years in mind for such preservation or protection?

                   It is our understanding that the bulk of the problen idth inheritance
               and estate taxes is at the federal level. Can the Cannission have any
               impact on those taxes? Or was it the Cam7ission's intent to modify only the

               State inheritance tax laws?

                   The categories referred to as Classes I, II and III should-be@ re-examined

               to determine if it is reasonable or financially feasible to preserve or

               protect all such lands, since they cciobtitute a formidable percent of all land

               in the State of De@aware, and seem to be especially concentrated in Kent

               County. We have no statistics on the number of acres in the categories of

               Class I, II and IIItas defined by the U. S. Soil Conservation District.

               HdOever,.1974 statistics published by the Department of Commierce, Bureau of

               Census, indicate that 477. (601,000 acres out of a total of 1,268,415 acre
<pb n="677" />

             in the-State) is in farm use, including woodlands and pastures.

                We would like  to suggest that the formation of agricultural districts

             be included as one of the possible incentives to be investigated.

                if any preservation policies are to. be adopted, we would like to see a

             paragraph or two -similar to the f irst two paragraphs of 3 under OOMMWATION

             AND OPEN SPACE inc, luded in the comments on agricultural land. It should be
             spelled out that "agricultural land should not automatically be regarded as

             land awaiting, or available for future development, but rather as land
             already dedicated to specific use." Likewise, agricultural land sbould be
             defined aaa "clearly specified area designated for preservation in its

             own right." Mdx is NOT the way land defined as agricultural land for

             farmland assessmmt is now viewed.

             Residential land

                Wsbare the    Cam&amp;ssion's concern for the Delaware citizens who, because

             of their physical, socialand econcmic conditions, are not adequately

             'housed. We agree that the State should assume a greater leadership role in

             dealing, with this problem. We would like some clarification on wtdch laws

             the CbMission would. like to see modified and what provisions for consistency

             they amrision (policy 3). What powers and duties would an expanded Division
             of"Housing bave? How would it differ frcm the present Division of Housing?

             FAmmic Development

                We question some.of the statements made in the introduction to this

             section of the report.

                 The  total cost of new industriai construction in Delaware has become

             expensive." (Page 32). True, but it is equally true of the other.49 States.
<pb n="678" />

                                                   _22

               Does the inclusion of this statement mean to imply that industrial construction

               cost has risen more in Delaware than in other States?

                   "Delaware has fallen behind in its higbway prograd' (page 32). In

               capital appropriations since 1967 (which is the source of the high indebted-

               ness mentioned on page 31), the highway and transportation portion accounts
               for $199 Million of the total.$542 Million             s    about 37%. The
               ectommc de4elopment report seems to be saying on the one band that we

               haven't spent enough on highways and an the other band that we've borrowed

               too mich money in the past. Could the Commission clarify what portions of

               the remaining 63% of the already existing debt were unnecessary? The cost

               of public services study, wi-rich is included in the appendix, estimates an

               increase in transportation spending of 107. per year aver and above inflation.
               This presumably incorporates the Commission's recommendations about cluster-

               ing and anti-sprawl. Is that figure reasonable'?

                   Page 33, line, 6 should read '@Yrospectivel 1, not "perspective".

                   We felt some confusion about a reference on page 34 which says: "The

               Delaware Tomorrow Commission should,establish population and employment

               growrth goals       Does this mean that the Commission will go further

               than this report in establishing specific growth goals?
                   Might this section of the report be more meaningful if Delaware's

               situationwere compared with neighbo7_-:rg states?

               City of            Findings

                   The 1,eagues of Women Voters of Greater Wilmington and W%wk support

               the         dations dealing with the City of Wilmington, partiaLLarly the

              ,idea of spreading the tax load beyond the city-limits and the recognition
<pb n="679" />

                                                  23-
             that the city is,an integral part  of northern Delaware,  and one carmot.

             prosper without the other. However, implementation of    such a policy

             should be done carefully, so as not to encourage sprawl in areas,other

             than northern Delaware.

             Tax Findings

                 This, section deals with capital gains. and personal income tax structure.

             as though they were taxes affecting business, rather than, as was stated on

             page 33, as taxes affecting,those individuals who are in a position.to de-

             cide where business will be located. We are not questioning that business

             location,in Delaware may indeed be adversely.affected by these taxes, but

             want it, to be clear to all who read the report that.,, if such taxes. are

                       affecting   business location, it is because the business leaders
             adversely

             are aking such decisions on personal considerations.

             Land Use Planning and Regulation

                 It is not clear to us what the Commission's recommendation would mean

             if a. local. jurisdiction bad land use goals which were not in agreememt with

             ,,-State, land. use goals. It might be well if this potential situation were

             addressed in the report.

             MR., BIONDI.

                 Thank you Rita. I might mention that Rita is one of the relatives
             of the  Women's League of Voters who spent many evenings with the Commission

             and at no. time had Laryngitis.

             MR. DREXLER:

             David Drexler, Attorney
             Wilmington, Delaware

                 I appear here as a private citizen who has, from time   to time, taken some
<pb n="680" />

                                                  -24-
               interest in the matters that the Cammission has studied.' I also appear here

               as me who is not a native of Delaware, but who is. truly appreciative of the,

               opportunity that Delaware has afforded myself and my family to lead a

               reasonably productive and reasonably pleasant life here and it's something

               I would like to see that opportunity afforded to my children and the children

               of others. Yx. Chairman, I have read the tentative.report and I think, by
               and large, it's a fine and thoughtful report providing many guidelines. I

               would personally like to commend and thank the many private citizens who

               devoted so much time to this and for that reason I would strongly urge that

               their efforts not go unrecognized and, in a sense, that this report of the

               Delaware Tomorrow Cbmission end up as another Hagemeyer, Carvel, Tunnell

               or any number of other reports that have been done in some of these areas

               from time to time: done, filed, and forgotten. I would strongly recommend

               that the Commission study some method whereby its findings can be continually

               brought up to date and brought to the attention of the Dublic and to the

               elective and appointed officials so that the action can be taken and we merely
               don't have another report tbateverybody says is wonderful but nothing is

               ever done about it. There are two areas where I believethat thexecammnidd-,-

               tions; that the Commission have tentatively reached do not measure up to what

               the Commission's perception of the problem In the area whieh,'V11 discuss.

               As I said, I believe the           tions can be strengthened. The first area

               is in the area of tax revenues. I an very disappointed to see that all that

               the Commission can recommend is that more study be done.. I think that the

               Commission has handed out in its tentative findings, what the realities of

               the situation are and that these realities are to be placed squarely before
<pb n="681" />

                                                 -25-

             the people and their elected officials. This is an election year and if      the

             past is any indication, all candidates,of all parties, for   all offices, will

             autdo'each other in promising no more or different taxes   and then after one

             or another.is elected to,office, find themselves either breaking that promise

             or their bands are so tied that they are unable to deal realistically with

             the problem.  1 think we should, therefore, set the problems squarely before

             the public with specific recommendations so that the people who are running

             for office will be forced to deal with those problems and the way that they

             are. The CamiLssion's Report suggests that the Income tax structure of the

             State is counter productive and must be changed. I think I agree with that

             finding and I think there should be a recommendation that it must be changed.
             I've done some calculations and I leave.it to.an accountant to check them out,

             but my estimate is one $85,000  executive in Delaware pays as much income tax
             in the State of Delaware as 31  $10,000 incomes or more than-20 $12,000 incomes.

             Now I. don't know whether that is fair or not. I'll leave that to someone with

             a more acute sense of fairness to judge, but   I suggest very strongly that   it's

             non-ccmpetitive wtien it's recognized that the $85,000 person who has it in his

             power to make the decision whether or not he brings those biraself and those
             $10,.000 or $12,000 a year jobs to Delaware or whether he takes them somewhere

             else. I suggest that the Commission find that we mist revise the income tax

             structure ofthe State or the state will stagnate. I think also that the

             Commission should make specific recommendations as to sources of, revenue in

             the future. Sales tax has been found to be an 'acceptable way of raising

             revenues  in virtually every other  tax and jurisdiction in the free world, and

             I see. m reason w1rj that cannot be  seriously considered for Delaware. The
<pb n="682" />

                                                  -26-
               Cc6mission R%:)ort suggests strongly a need for public transportation. It

               seems to me that what goes hand and hand with that is a recommendatim that

               the tax structure with respect to the use of private automobiles, both

               license fees and gasoline, be adjusted to encourage the development and use

               of public transportation. In this area, I suggest very strongly that the

               C;ommission, "bite the bullet" and "lay it on the linelf so that there can be

               no more equivocation with respect to these areas. The second area I feel

               the Commission has weakened is its recmrmndation in the area of government

               expenditures and government structure. Here too, the substance of the

               recommendation is '@wre study." I think there is enough in the findings

               that the Commission can make some more specific recommendations. The fact

               is that (if I may pl-wase it differently) the report sums it -up "that in

               present modern terms of size and population, Delaware is just a couple of

               Counties.*trying to be a State." I think this is the cause of many of our

               problems and I think also it points to the area in which some solutions could

               be found and, therefore, some recommendations should be made. By way of

               illustration, am hypothesis. is the abolishment of DeL%mre and the appenditure

               of the State to either Pennsylvania, New Jersey, or Maryland. One can, e.-mily

               add up the m=ber of jobs in the Executive Legislative and  Administrative levels

               that would be abolished in Daver. The question that intrigues one is if you

               ask how many jobs would have to be added in Harrisburg, Trenton, or Annapolis

               to maintain the suae services at the same levels as the people of Delaware

               are not receiving   correction, now receiving.

               MR. BIONDI:

                   Maybe, you bad it right the first time.
<pb n="683" />

                                                 -27-

             M. DRUUM:

                 I don't know the answer to that question but I suspect very strongly that

             if one did that study, they would come up and find that far fewer jobs would

             do it; mainly, not because of under employment of people but by being a State,

             we have a Governor %ho governs 500,000 people. Governor Carey in New York

             governs 12 or 20 million; Governor Brown in California governs the same

             rxrDber, yet essentially doing the same job. Now, asl said at the outset,
             I'm grateful with the life we lead here in-Delaware and I don't seriously

             suggest thateverything be resolved, but I think a study like that points

             the path to ways that the use of Goverrmient could be more efficient. First

             of all, I think functions should be combined and duplication of limit. One

             th ing that comes clearly to mind is New Castle County and Wilmington. The

             fact is that throughout the country there are mayors or county executives

             who are efficiently delivering necessary services to far greater areas than

             combined Wilmington-New Castle County and to far greater populations that

             combined Wibrdngton-New Castle County, yet we have two structures. Structures

             which are geared to fairly low pay grades down the line and,, therefore, do

             not attract to that service people of the highest quality. If those services

             were combined, we could probably raise the pay level of the combined mayor/county
             executive and.his entire s ingle staff and ccme up with considerable savings
             nonetheless.  Other areas of saving that appear and ought to be recommended by

             you are camera lesislature, and we have a group of'essentially the same areas

             represented twice down there. The police have been a source of recent dispute,

             and there should be a way of ccabining the police into one or tw efficient

             units and that should be recommended. It seems to me that, in Light of what

             I first said about. the.combibipgof services of other states, a recommendation
<pb n="684" />

                                                 -28-

             be made that there be  a study of the possibility of entering into inter-state

             compacts to combine our services, the services which we render in Delaware

             on an efficient basis with the sane organizations in our sister states -- in

             the areasof prisons, mental health, public health,.highways, etc. Recently,

             the. University of Delaware was faced with the suggesticn. that they develop a

             medical school. They rather intelligently declined to do so; instead, they

             entered into a program uiieareby they arranged for scme Dela wareans to attend

             the Jefferson Medical School in Philadelphia under the auspices of the

             University of Delaware. It seems to me that this type of approach would be

             fruitful in all of the areas -- in many areas of public service and a recom-

             mendation should be made that a study of that approach be undertaken promptly.

             Again, Mr. Chaixman, I commend the Com-nissian for this work and I hope that

             it won't go to waste. I would hope also that they would consider making

             these more specific recommendations.

             MR. BIONDI:

                 Thank you, David, and I know your views have been long held and very

             seriously held. I've heard them over a beer and a cock-tail for many years,

             and I'm happy to see them on pub lic record.

             MR. MATLACK:

             Albert Matlack
             RD 1, Bc%- 137
             Hockessin, Delaware 19707

                 The Report is a valuable document an the wbole.    It contains nmy

             commendable goals such as:

                     L' Preservation of the best farmland.

                     2. Rehabilitation of rail service.
<pb n="685" />

                                                -29-

                     3. Redesigning for pedestrians.

                         Discouraging urban sprawl.

                     5. Channeling growth into urban areas where services already exist.

                     6. Sharing of commercial and  industrial re'venue.

                 However, the section an growth and economic development is frightening.

                 Before going into this in sane detail, let's look at DeLmare today and

             tomorrow through the eyes of an envirormentalist. What we see is virtual

             loss of the cypress swamps of southern Delaware; steady loss of wetlands in

             Sussex- bays; a declining fishery in the estuary; more and more fr  equent

             violation of air quality standards for photochemical oxidants in central

             Wilmington;, and a'steady replacement of the native plants and animals of
             the Piedmont by houses. All of this is happening as part of growth    and...

             development.

                 Man is part of an ecosystem on which he depends for survival. His

             primary needs are for food and water. Frm this it follows that (1) the

             best farmland in the State, that near Middletown, should be kept in agri-

             culture; (2) the highest possible amount of wetlands should be kept to

             provide for a viable commercial fishery; (3) development should not interfere
             with. recharge 36f aquifer*; (4) water pollution should be reduced to the point

             where the streams can assimilate the organic loads placed in then. The

             preservation of natural areas also comes in this top priority. Such areas

             are potential sources of new foods and drugs and serve as homes for natural

             pollinators and predators of destructive insects. They provide a base line
             for management of disturbed areas.
<pb n="686" />

                                                    -30-

                    Minerals are where you find then and come next in priority. Some

                Industry would be next lowers, i.e., the part dealing directly with natural

                resources. Below all of these would come   the rest of industry, recreation

                and housing.

                    Let's set sane goals for tcmorrow:

                        1. To save enough of each habitate in each stage of   succession so

                that there will be some always.

                        2. To keep population in balance with the natural resource base.

                        3. To understand the forces of nature and to work with than, not

                      t then.

                       .4. To achieve  a statewide, and even regional, land use plan that

                is ecologically sound.

                        5. To  encourage good health =)ng Delawareans,by providing ways

                for then to get mwugh to eatP places to live and ways to keep physically

                fit. This means jobs for all who need them.

                    And now for econcmic development. What we reallywant are jobs for

                those already in Delaware, jobs of diverse types so that a set-back. in one

                industry, such as the assembly of cars, will not be felt so much. If all

                the Inducements mentioned in the report are -used, there may be a flood of
  MIR           people cadng Into Delaware, with aggravation of the present envirormental
                problems. How can a State which already has the highest, or close to the

                highest, bonded indebtedness per capita Issue bonds for land and buildings

                for new industry? Debt service Is already UX of the State budget.

                    It has often been assumed that an expanding population is necessary for

                a healthy econamy. Has this ever been proven? Maybe we just need expanding

                technology, skills, interests, and services, with zero population growth.
<pb n="687" />

                                                    -31-

             It waa recently estimated, that 24,500 low to moderate income women in

             Del.-mre. need family planning services    that are unavailable  to them., A
             State appropriation of $50Q,000 to provide these services would be.a very

             sound investment6

                 The, report: suggests no criteria for new businesses.     Should a water

             intensive tx1ustry be encouraged to locate in water-short Newark? One

             wanted to, a brewery. The highly automated land-intensive type is clearly

             undesirable. A business that canes and brings most of its wrker s with it

             will provide few jobs. The business that provides the most jobs per square

             foot may be good, assuming that it requires:a. balance between unskilled,

             semi-skilled and highly   trained workers. Industries that,are known. to be

             .heavy polluters must be  scrutinized with great care..

                 The construction industry has been anxious for more. thirgs to built to

             providejobs. Why not rehabilitate exi      sting structures?   There are 1,200

             vacant hcmes  in Wilmington. Fixing. them up would be cheaper than. building

             new ones. Why not bike-ways, walkways, rail lines, :waste-recycling plants,

             waste treatment   facilities, district heating facilities? How about putting
             mDst of the $90 million. for higbways into a balanced systeRL of public trans-

             porrAtion.? Federal low permits this. A Metroliner could get people to

             Rehoboth with far   less energy consumption that private cars. The rail lines

             are already there,   but they're about to be abandoned,    possibly even with

             loss of the rights-of-way. The Report mentions a South Wilmington. Connector

             to bring more.-carato   the center of Wilmington., where there is already a

             problem with too much auto exhaust.. Wh
                                                        y not use the existing rail lines

             instead, perhaps with a.spur    to Rodney Square? This will be a lot cheaper

             than four more   lanes, on 1-95 to get ccuuters from Newark to Wilmington. Is
<pb n="688" />

                                                 -32-
                   our goverment bold enough to require that a car  on a major traffic arterty

                during rush hour have at least 3 people in it?

                    At its peak the menhaden fishery in Lewes employed 600 people. The

                fishery collapsed due to:

                        1. Efficient means of catching the fish.

                        2. Catching then before they were old enough to reproduce.

                        3. Contaminating there nursery grounds in the upper Delaware

                estuary with Philadelphia and Camden sewage.

                    Building suitable treatment facilities and adopting sensible rules for

                sustained yield harvesting could bring back, perhaps, 150-200 jobs, as well

                as many others concerned with other fish and shellfish.

                    If, as the report indicates, the Wilmington wage tax is a deterrent to

                business and Wilmington is no longer a viable economic unit, then perhaps

                the time has come to abolish the city and use county goverment.

                    Statewide and regional land use planning is very desirable. Wilmington

                water comes from Pennsylvania. The high biological oxygen demand in the

                Delaware River comes from Pennsylvania and New Jersey. Delaware's wetlands

                could be lost if pollution from the New Jersey side ..were- high , When the

                Coastal Zone Act is absorbed into a larger plan its provisions must not be

                weakened. It is clear that a higher level of goverment should set the

                guidelines and mininum. standards, "Leaving local governments to fill in  the

                details. The clean air standards were handled this way. This will not put

                local officials out of work or mean that their every move must be approved

                in Dover.

                    The costs of services should decline as the recommendations of the Repo   rt
<pb n="689" />

                                                -33-

            are iriplemented. A balanced system of various modes of transportation should

            be much cheaper in dollars, energy, and land than our present auto-oriented

            one. Mistakes of the past such as the Llangollen landfill should become less

            frequent in the future. If population.is more stable and does not relocate

            excessively, the cost of school construction should go down. Imagined needs

            and real needs are som.etimes confused. Although, by law, high school students

            living within 2 miles are required to walk they are bussed from 1/2 mile in

            my district. A few sidewalks, bikepaths, and traffic lights could correct

            this. The problem is that local school districts pay for the sidewalks wijile

            the State pays for the buses. My local district recently included on a

            referendum that failed, regrading of the football field, cLwbs for the driveway,

            and a fence around the property, but funds to reactivate the computer center

            were not mentioned.

                There is a big.gap between a statement of policy and its inplementation

            and enforcement. An ecologically sound plan for saving part of the Piedmont

            was ruined by a very vocal group who happened to live near a proposed village
            center. You should have heard.the argunents for continued sprawl, or as they
            called it, scattered development. The plan was adopted after deletion of a

            village center with some good policy statements an it, but with no ordinances

            for its implementation. So sprawl continues. Just wait for the scream uiv_-n

            Delmarva Power &amp; Light wants to locate a power plant next to customers' homes

            to allow waste heat to be used for district heating. Or until an industry

            wants to locate near the homes of its workers to cut the tinm and energy.lost

            in camuting. We hope that the legislators -vft worked with the Delaware
            Tomorrow Commission to draw up the Report will work for suitable legislation

            to implement its good features. Thank you.
<pb n="690" />

                                                   -34-
               MR. TARBURTON:

               John Tarbm-ton
               Farmer
               Dover, Delaware

                   I an appearing as legislative  agent for the Delaware  State Grange.  The

               Delaware State Grange wishes to congratulate and ccumend the menbers of   the

               Commission. We favor the land-use section with the@ following points: If

               the utility policy which addresses sewer system aver-development were ful-

               filled, there would only be minimal need for tax incentives to keep open

               space. There would not be a need to purchase development rights if the

               development pressure were not there in the first place. Sewer, water lines,

               and highways next to farm necessarily raise the value of farms to be

               ccImpatible with any other development property. Thank you,. Sir.

               MR. BIONDI:.
                  "tfwk you, Yx. Tarburton.

               MR., SLAWIK:

               Helvin A. Slawik
               County Ma=tive
               New Castle County, Delaware

                   Mr. Chainum, Membe  rs of the Comn ission, Ladies and Gentlemen:

                   Prior to embarking on a few brief remarks regarding the Comnission's

               ".recommendations, I would like to personally thank the Chairman for his

               diligent and tenacious work with the diverse interests of the members of

               the Commission. A1.3o, New Castle County Government   thanks those members

               of the Commission who have deavted much of their own personal time to this

               extremely important review of Delaware's situation and its future. The

                     s of both the Comission and the various committees have represented

               a cross-section of Delaware's people not only geographically but more

               inportantly in the interests which they hold and represent. I an especially
<pb n="691" />

                                                -35-

             glad to see the,participation of so many New Castle Comt3r residents not

             only from the government sector but also from private Industry and many

             special interest groups.

                 In reviewing the                 of the Ciommission, it becomes quite

             obvious that it represents a consensus of the many diverse interests

             within Delaware society. The most beneficial aspect of the ri        lations;

             however, is that many of the agreements reached by the members concern

             points of controversy that have in the past been either diluted or avoided.

             Any recommendations on a state-wide land use plan and structural reorganiza-
             tion of levels of government are the kinds of            ions that certainly
             do not win the favor of the political and often the economic commmnities.

             I can see that a might tough task was met head-on.

                 Mr. Chairman, as you are aware by our participation and correspondence

             with you, the New Castle County administration is in basic agreement with

             the recommendations of the Commission. We have thrown strong support

             toward certain items and will contisme to support then In the future. Also,

             we have had minor difficulties with certain areas but not to the extent that

             would require revision to the recommendations.

                 Of special note to us in the review of the Commission's recommendations

             are some half dozen particular areas which I would now like to address.,

                 A. For reasons of more rational development and economies of public
             funds, the recommendation regarding "sprawl" and the direction of develop-

             ment into urban, concentration areas is supported by us. As state and

             local governments continue to build up massive public debt, this type of

             development is not only desirable, but necessary.

                 B. New Castle County also would like to see further activity in the

             adoption of a comprehensive nis s transit system in the urbanized areas.

                 C. Your recommendations regarding public utilities have, of course,
<pb n="692" />

                come from past history in many of the suburbs of New Castle     County. In the

                past three years, the county government, both Executive and     Cou:ncil, ha  ve

                built and planned for waste water disposal systems that are not only

                adequate, but, we believe to the best possible extent, least detrimental to

                the environment. Both large and local sewer projects werere-studied and

                re-      Itized in such a manner as to avoid excessive installation of sewage

                lines. As you know, excessive installation. has often been a chief cause of

                sprawl and its consequent adverse economic pressures.

                    D. We support your recommendations regarding the needs for housing.

                Especially for persons of low and moderate income, housing in Delaware is

                now in most cases out of reach. This situation. needs rapid correctim.

                    E. Your reccmmendations; regarding industrial land use policy and

                economic development activities are for th   e most part supported by New

                Castle County. Generally, the real problem rests with inactivity in the

                area of economic development. We feel that more diversification. is requixed

                in the industrial sector within the 5.tate and that In order to accomplish

                this an efficient and active campaign of both industrial solicitation and

                economic stinulatim is required. The County government is eager to embark

                into these activities.

                    Your specific recommendation regarding the Delmarva Advisory Council is

                fine in respect to Kent and Sussex County; however, since the Advisory Council

                cover only part or New Castle County, we feel that sane mechanism needs to
                     s

                be created to assist in stimulating the economy in the northern part of the

                State.

                    We support your reca@     iation re3arding oil and gas exploration. and
<pb n="693" />

                                                -37-

             development. Econanic activity especially as it surrounds the port area

             of Greater Wihdngton, both water and air, should receive benefits fran

             the off-shore drilling activity. DeLware should begin actively pursuing

             such benefits.

                 F. As you are well aware, representatives from my staff and from

             County Council have actively participated in the Carmission's discussions

             regarding a state-wide land-use plan. We support such a-plan as reccm-

             mended by the CamLission.

                 The county government has comitted many manhours and hundreds of

             thousands of county tax dollars to the development of district plans and

             we are presently updating our.canpr6hensive plan. Such action on the part

             of local gavenment is, of course, not limited to New Castle County. Along

             with the traditional legal controls aver land use, such as zoning, these

             planning activities generally should renain the prerogative of local govern-

             ments. The State rightly should concern itself, however, with those State-

             wide land use decisions and certain-critical areas that affect the social,

             ecorm&amp;c and environmental aspects of all Delawareans.

                 G. The most critical aspect,of the CamLission's reconmendations is

             highlighted in its final section an the "Cost of Public Services." The

             econon-&amp;c forecasts of this section are ominous to the taxpayers of Delaware.

             This is especially true in light of the recent fiscal activities of New York

             City, the bond rating problem of the State of Delaware, and the misunder-

             standing regarding Wilmington's fiscal condition. New Castle County is very

             aware of the :Wpacts of less than full planning in the area of fiscal policy.

             We recognize that the time to act through self-restraint is required before

             fiscal problem arise.
<pb n="694" />

                                                  -38-

                   Your X-ecomendation in this area, however broad it is, iaplies sane

               very basic reviews of the entire govennental situation within the State.
               and its political subdivisions. Whether' a  service is delivered and by what

               level of government a service is delivered; whether revenues are required

               and by which level of government the revenue should be collected; what

               functions government should perform; and whether certain levels of.govern-

               ment should even exist -- these are pieces of your recoamendation.

                       These are the major concerns that should be addressed by all

               elected officials now and tcmorrow in the.State of Delaware. New Castle

               County Gavennent has already begun to look at some of these questions.

               We are studying our role in relation to the state Govern-nent in the pro-

               viding of social services and we. are continually working with the State, the

               localagencies to determine service needs, funding of services, by which

               government, etc. However, such activities as these are piece-meal In. relation

               to what is needed. An in-depth conprehensive review of the entire govern-

               mental structure and service delivery system nust begin soon if we are to

               avoid the predictions that the Cmraissim has reached. We do believe that

               th ere is a very important role for local-gavernnent to play in this State.

                   In conclusion, two things are iaportant. First, as best we can, we

               in Delaware need to control our am destiny. We should begin now to do

               these things necessary to avoid the situations that have arisen in New York

               City on the one h,-_.d.or in the State of California on the other band. In
               the one case, the Federal Government has basically taken 'aver; in the other

               case, the State is looking to throw the Federal Government out ccupletely.

               I don't believe that either extrem is acceptable, but wiiatever direction is

               taken, it should be done with as mach possible input from the citizens as is
<pb n="695" />

                                                 -39-

             possible. lie should be in a position to set our  am directions relying on

             regional and national resources wbere only absolutely necessary and making

             the best possible use of inter-gavernmental revenue as is possible. Secondly,

             a mechanism needs to be created to ensure that the Comdssion's recommenda-

             tions are not placed on a shelf and forgotten.

                 Action should be taken quickly to institute the recommendations admini-

             stratively or legislatively, whatever is necessary. Somehow the irpetus of

             the Commission must continue and the functions of . the Commission should be

             a continuous process to keep the citizens and decision-mekers of the State

             abreast of our growth and development posture.

                 Thank you.

             MR. BIONDI:

                 Thank you, Mel.  On bebalf of the Ccnmission, I want to thank you for

             theservices of many of your people in New Castle County who attended all

             of the meetings, the. Committee meetings and the Camatission meetings, wbo
             played a great part.in the Commission's Report: Carl Russell, Dick Bauer,

             Myrna Hurd, and many of your people who worked on this matter with us. We

             certainly had cooperation from New Castle County.

                 .Is there anyone else who desires to speak?

             MR. RYAN

             Daniel A. Ryan
             219 Mercury Road
             Newark, Delaware

                 I'd like to make a statement that my first impression of this Report

             was a somewhat negative one because Lhe beginning words were such that I

             got the ix-ppression that the Report pre-supposed growth in Delaware.   This,

             alway s to me, carries the irrplication that all land will be imed:Lately
<pb n="696" />

                                                 -40-

               developed to the highest population density or to the extreme industrial

               capacity with all the meaning space paved. I an happy to say that my

               first impression is wrong, in reading it, and the Report shows much that

               it is progressive in nature. Everybody has their own axe to grind or

               banner to wave, and mine is in the area of land use and I'd like to make

               just a few comments. My favorite topic is contained in a statement on page

               23 oftbe Report in which it is stated that open space is a "clearly

               specified land use." I think that this one topic - this one statement

               illustrates a broadening of the consideration of land use which is very

               hopeful for the future of Delaware, not just an open space, but as was indi-

               cated by one other gentleman - a previous speaker - farmland and right on

               dam the list. Mmy times people talk in terms of changes in tax policies

               in which land use is taxed at the highest rate, perhaps with the added

               incentiv e that improvements then are not further taxed thereby discouraging

               indiscriminant land use. This is fine, except that very seldom do they

               modify that statement by,admitting that there is something other than a land

               use that is not so intensive in its tax return. Many things are more subtle

               than just very high tax income. The most efficient use of housing is, for

               example, a high-rise terament, many high-rise tenements packed closely

               together. This is efficient in terms of land use if you just consider

               population packing, but it has obvirnm disadvantages. The concepts must

               be broadened in rha application. The concept, as it was stated in   the

               Report,of sewers being a self-fulfilling prophecy, as the sewers extended

               so shall the population be extended. I think this also applies to the mass

               transit system -- as mass transit is extended, so shall the population be

               extended. Mass transit is required and there are many problems involved In
<pb n="697" />

                                                -41-

            it, but there are many advantages to it.   I think one thing that should not

            be forgotten, however, is that in case  of a suggestion whereby the auto

            'taxes on gasoline or the auto taxes itself.be used to subsidize mass transit,

            tbere-must not be a reverse application of this. The automobile should not

            be penalized before  the ability to have,mass transit is available. Many

            areas of New Castle  County and, of course, Delaware in general are not

            served by mass transit at this time. If you disabuse the ability to use

            personal transportation, you may deny access to many people to their areas

            of employment.   In closing, I would'hope that the implementation of the

            positive futures of this Report will not require aggressive action by citizen

            groups as have many things  in the past. I would rather hope that a cooperative

            venture by all will be the future. Thank you.

            MR. BIONDI:

                Thank you very much Mr. Ryan. Is there anybody else who desires to be

            beard this evening? I would like to put into the record a note by Mr. Oldach,

            who is a member of the CmurLssion,  dated January 7, 1976 and a letter fran

            Tom Hughes, a local attorney, who  could not be.bere tonight and who asked

            that his views be put into the record of the Commission. I received two

            letters from a  local attorney, David Nichol Williams. The first letter was

            dated January 2, 1976 which contains two pages with ten points commenting on

            various sections of the Report and then I received a follow-up letter dated

            January 6, 1976 from Ni-. William which I would like to read into the Record:

                'Tear Frank: After considering in =re depth the problems and

                projections of the Draft Report, it appears the only conclusion is

                for Delaware to consider an amalgamation of government at all levels

                intoone central government with the hope that it would accomplish

                one streamlined administration for just aver o ne-half million people
<pb n="698" />

                                               -42-

                        instead of a pyramid of administrations standing M each
                        other's shoulders at different levels of government to

                        serve such a small number of people.

                        In the year of our Bicentennial, a reccumendation and

                        the implenentation of. less government instead of moze,

                        govern -t would be consistent with the revolutionary

                        spirit that made our country great.

                        As a final observatim, I hope all the hard work of

                        your Ccmmission. and the Report you wrote is put to

                        use and not just wasted as.a political exercise."

              MR. BIONDI:

                   It certainly would be revolutionaryl It sews to be on.tbe mind of

              more than am council bere tonight. As we ccme tothe end of this public

              bearing, I'm reminded about the story of Al Smith wbo went to address a
              rally one night and got up and promised he wouldn't talk very long. He
              said: "Don't worry about it folks, I'm not going to be too long." and

              a fellow in the audience said: "Tell us all you kt-xw, Al,,and it won't

              take very long at all.11 Al looked --it and said: "If I tell them all we

              both know, it won't take any longer.ft I think maybe we "Al Smithed"

              this thing right to the end and told each other all we know and I want to

              thank you for participating in this public bear*    Thank you very mich.
                                                            U19

              Attendance   approximately 85.
<pb n="699" />

                                               1100 Berkeley Rd.
                                               Wilmington Del. 19807
                                               January 7, 1976
            0. Francis Biondi, Chairman
            Delaware Tommorrow Commission
            Thomas collins Building
            Dover, Del. 19901
               araft Report of the  Delaware Tommorrow Comuissi.on
                 (Staff working paper   September 1975)
            D@@ar Mr. Biondi
                            In'my opinion the subject report is very
            good and fairly presents the Commissions deliberations. There
            are two minor word changes which-in my opinion would greatly
            enhance the reports impact on the business community in regard
            to DelawarJs anti-business image.
                   First9the recommendation on page 43 simply proposes
            a study of the tax structure. Many peoples reaction will be
            Itw
             eve had lots of studies to no avail". Therefore I would add
            the words - "and the necessary changes made to bring these taxes
            in line with those of more,progressive states".
                    Second.the recommendation on page 46 states that the
            time has come to replace the initial coastal zone act with a
            comprehensive act and then immediatly cools you off with the
            statement that the present regulations should be used in-tact
            until the new regulations are complete and enacted. This is not
            a very reassuring statement to those industry representatives
            who know the act is an.arbitrary exclusion of certain classes
            of industry without any relationship to the real problem,
            which is air and water pollution. Someone managed to get into
            the commissions records the statement that the problem was
          .one of a disagreement between industry and government officials.
            This could not be further from the truth. The only problem
            as.far as Delawareis image is concerned is that it have reasonable
            laws and administration there of. Therefore it would make a
            much better impression on knowlegable readers if this recommend-
            ation were modified to recognize the act's inequities. With this
            in mind Iwould suggest adding the following,following the word
            "to" in the first line- 11 remove as quickly as possible the
            inequities of the Coastal Zone Act by replacing this initial
            legislation-', and eliminate the words -"replace initial
<pb n="700" />

             Coastal Zone  Act-11
                     While tiese points are generally recognized in the
             body of our report few people will ever read anything but the
             condensed summary of our findings and conclusions.which
             I assume will be made available to the press when the final
             report is issued. Therefore I think it important to word
             our Recommendations carefully so as to give the correct
             impression to the reader.

                                  Sincerely yours,

                               Carl S. Oldach
<pb n="701" />

                                      LAW OF
                                           FICES
                           O'DONNELL AND HuGHEs, PA.

                                    904 MARKET TOWER
       FRANK O'DONNrLL                                                 TELEPHONE

       RICHARD E. FRANTA
       THOMAS G. HUGH ES       WILMINGTON, DELAWARE 19899             (302) esa-moi
       MICHAEL R. SHAPIRO          January 5, 1976                    P. 0. BOX 2214

        Delaware Tomorrow Commission
        c/o 0. Francis Biondi, Esq., Chairman
        P. 0. Box 1950
        Wilmington, Delaware 19899

        Dear Members of the Commission:

             I have.read your draft report of September, 1975,  with
        interest and hope that I will-be able to add some thoughts to  what
        is an important and well conceived document. My comments are   both
        general in nature and specific.' They are as follows:

             One: The report in general is well done except that it   is
        inconsf-stent in its approach to different subjects. For instance,
        certain parts of the report are rather precise in their conclusions;
        ie, specific recommendations are made with regard to the extension
        of sewer systems, with regard to agricultural farmland policy, and
        with regard to present negative effect on new business of the state
        income tax and capital gains tax. On the other hand, other areas,
        of the report are vague to the point of being useless;, ie,,the
        comments on costs of public.services. This part of the report is,
        in my opinion, useless for it simply states the problem which we
        are already awareof without@any effort to suggest resolutions such
        as not allowing.police to retire after twenty.years but assigning
        them to other governmental duties after active police duty which
        would save the state millions of dollars.

             Two: The exemption of institutional land users, specifically
        those tTiat claim governmental immunity, is a substantial problem
        which the Committee report addresses itself@to on Page.27". Very
        specifically, as the City Solicitor of Newark, I find the City of
        Newark often totally frustrated in its land use plans because of the
        exemption of the University of Delaware from zoning. The University
        of Delaware owns 48% of land in the City of Newark, yet it can
        legally ignore the valid land use goals of Newark. Other govern-
        mental agencies similarly ignore the needs and desires of the local
        community and I laud the intention of the report to make govern-
        mental agencies and charitable foundations subject to land use
        control.
<pb n="702" />

           Delaware Tomorrow Commission
           Page 2
           January 5, 1976

                I also note that at least one major landholder in Northern
           New Castle County which operates under the guise of a charitable
           purpose under a will has for the past 25 years done nothing but
           add to urban sprawl and aid the more affluent segments of our
           society. Certainly its land use goals have been more alligned
           with developers than the good of the community. It seems to me
           that the State' Attorney General's office could look into the basic
           intent and purpose of this and other organizations and, if
           necessary, force them to comply with the needs of the public at
           large.

                Three: The report's comments on   the State income tax and
                 r -                              with my personal observations
           capita gains taxation are consistent
           as a private practitioner of law. My   partner and I have advised
           many clients to leave Delaware rather  than pay current income
           taxes and capital gains taxes. It is   clear to me that the present
           capital gains tax and state income tax is self-defeating; ie, they
           drive out of Delaware those most able to pay for governmental
           services. High income retirees in particular can and do leave the
           state. Of course, those with inherited wealth also may leave and,
           in fact, many have already done so.

                However, the report is.upsetting  in that it does not address
           the problem of replacement of revenue. If, in fact, downward
           adjustments are to be made in the state income tax at the higher
           levels and in capital gains, then this loss must be offset by other
           sources of revenue. It is clear that no adjustments can be made in
           our state income tax unless an alternate broad base source of income
           is found. Obviously, the Committee which showed courage in many
           areas did not have the courage to even suggest that one other
           broad-base tax which could replace in part the negative effect of
           the income tax is a sales tax. I do not necessarily support a
           sales tax nor do I ask that the Committee support a sales tax. I
           do, however, believe the Committee should.recognise the implications
           of changing the income tax.

                Four: Delaware as a state has one of the lowest    real estate
           taxes in the country. Low real estate taxes are generally considered
           good tax policy. However, part of the problem of local governments
           which rely on the real estate tax heavily is the appearance of tax
           increases almost annually, when, in fact, taxes may only be increased
           to keep up with inflationery trends. Even though there was a general
           reassessment in the New Castle County as recently as 1971, inflationery
           trends have already made the dollar figures on real estate values
           obsolete. If, in fact, the assessments were raised annually by an
           factor, the real estate tax base would be broadened and local govern-
           ments might well be able to live within the rate structure as it
<pb n="703" />

               re Tomorrow Commission
         D61awa
         ..Page 3
         january-5, 1976

         relates to actual value of real-estate. The total effect of what
         I:propose would allow local governments to maintain constant tax
         :rates-but offset inflationery trends with increased tax base. This
         change, I believe, would lead to'better accountability of local
         government expenditure.

              Ihope that the Committee will focus in on areas which,
         although controversial, demand solutions. Therefore, my overall
       .@suggestion is that the Committee take positions on issues such as
         tax policy, even if consensus cannot be obtained. The report as
         it is-now presented simply does not come to grip with many tough
         problems which cannot be indefinitely ignored.

                                            Respectfully,
                                                           0e,

                                            Th, as G.   g es

         TGH:znw
                                        ;@Thomas G. @H /:fe@s@
<pb n="704" />

                                D.kVID NICOL WILLIAMS, P. A.
                                       ATTORNEY AT IAW
                                   SUITE 522, MARKET TOWER             1976
                                     901 MARKET STREET

                                  WILMINGTON, DELAWARE 19801
                                        (302) 575-0873

                                    January 2. 1976

               0. Francis Biondi., Esq,
               Box 1950
               Wilm., Del. 19899

                                    Draft Report of
                         THE DELAWARE TOMORROW COMMISSION

               Dear Frank,

                    Thank you for the opportunity to preview  the above report.
               You have my permission to include this letter  in the Public
               Hearing Record.

                    Overall the report is comprehensive in its observations;
               but too diffuse in pinpointing the problems-and specific solutions.

                    The following are some of my observations after reading the
               report which.are intended to be constructive rather than critical,
               or to report that with which I agree.

               1.   1 did not think the Commission had any members who had ex-
                    perienced the practical difficulties of locating new business
                    in Delaware with the possible exception of yourself. It seemed
                    heavily weighted toward activist groups.

               2.   Based on my experience, no prospective business has made a
                    decision against locating in Wilmington because of the wage
                    tax.

               3.   Since progress is made by capable persons,  emphasis should be
                    put on hiring one or two really top-notch well-paid profes-
                    sionals to work on bringing business to Delaware and keeping
                    it here instead of the general allusion to a staff.
                    [Why not come right out and say the Delaware Chamber of Com-
                     merce has been ineffective as a private organization in
                     bringing business to Delaware?]

               4.    No mention has been made that the percentage of gross.tax
                     revenues from corporations has decreased over the years in
                     comparison to the constantly tncreasi .ng pdrcentage of gross
                     tax.reVenues ftom individuals.

               5.    The tax inequities in Delaware stem from the lack of enforce-,
                     ment due to a poorly staffed and paid Division of Revenue.
                     The whole job falls on the shoulders of four or five capable
<pb n="705" />

          0. Francis Biondi, Esq.
          January 2, 1976
          Page Two

                people. I learned from the New Castle Recorder of Deeds that
                the Division of Revenue wanted to throw out the real estate
                transfer tax records.
          6.    Stripping away all the typicalreport verbiage, Delaware's major
                problem is fiscal responsibility (i.e., getting more or better
                services for the tax revenues spent). No company is going to
                take a chance on locating or staying here if our fiscal policy
                leaves no alternative but higher taxes because companies-will
                have no way of anticipating if they will be the next victim.

          7.    Government waste should receive moreattention. As an example,
                why should four to ten State Highway Employees show up when
                a taxpayer has a simple construction easement problem that
                could be handled by one Employee.
          8.    1 do not agree that scrapping the Coastal Zone Act in favor of
                a Comprehensive State Land Use Plan is the answer to a better
                Delaware. The Coastal Zone Act has been effective in discouraging
                und esirable.industry because a strong law was needed. Any substi-
                tute which allowed for more discretion would subject planners t
                undue influence.

          9..   The State should reserve more authority over the expenditure
                of industrial bond issue funds so that projects like Omega
                Chemical and General Metalcraft for instance do not get bogged
                down when the company becomes irresponsible during contract
                performance.
          10.   By pointing to the big gap between revenues and State   budgetary
                needs in the future, you may,unconsciously be laying the.foundation't
                for a State Sales Tax which was the conclusion unjustifiably drawn
                by the local press from our recent Revenue Study Report.

                                              Cordially,

                                              David Nicol Williams

          DNW/  jg
<pb n="706" />

                    PUBLIC HEARING OF THE DRAFT REPORT OF THE DELAWARE TOMORROW  COMMISSION

                                            THURSDAY, JAN  8, 1976

                                  DELAWARE TECHNICAL AND COMMUNITY COLLEGE

                                            GEORGETOWN, DELAWARE

              MR. BIONDI:

                  my name is 0. Francis Biondi. I'm an attorney. I m Chairman of the

              Commission and to my left is Dave Keifer, The Delaware State Planner whose

              staff has coordinated the work of the Commission. To my right is Cliff Hearn

              who is Secretary of the Commission. I want a note for the record; apparently

              I did not do this last night, perhaps contributing some misinformation about

              three members of the Commission attending the meeting. There are members of

              the Commission other than the three people seated at the head table here

              tonight: John Walton, Miss Greer, JoAnne Slights, John Bryson, Art Kreiger,

              Cost of Public Services Committee, Carl Russell, and Joe Conaway -- so all

              the members of the Commission present are not necessarily seated, at the

              head table. This is the third hearing; we have held me hearing in Dover,

              and one hearing in New Castle County last night. The Delaware Tomorrow Com-

              mission was created by an Order of the Governor in June of 1974 and began its

              work in September of 1974. There are 31 members appointed to the Commission

              itself  The Commission was charged with the responsibility of studying the

              problems of growth in this State and developing recommendations to the State

              Government with respect to growth and the public policies wich should be

              adopted in this State with respect to growth. The Commission was divided into

              three Committees:. A Land Use and Community Development Committee, the Economic

              Development Committee, and the Cost of Public Services Committee. The members
<pb n="707" />

             of the  Commission were  appointed to  each of these  three Committees and, in

             ,addition., members of the general public were appointed- to each one of these
             three Committees   and there were.9 to  13 people on. each one of these Committees

             who are not members of the Commission itself, but who had an interest or

             expertise in the   areas of study. In addition, there was a Technical Advisory

             Committee created consisting of the planning people from all the levels       of

             local  goverment in the State and the State Planning people. The Committees

             have worked and submitted a report to the Commission and the Commission has

             taken up each one of    those reports, has, deliberated with respect to them, and

             has adopted a-preliminary re
                                           port which has       distributed and is available.
             The purpose of these   hearings is to secure publicinput, to secure the im-

             pression. of the members of the public with respect to the problems. which have

             been cited,  and the              ions which have been made to solve those prob-

             lems. It has not been our    format to review the report in detail at these

             hearings,  our feeling being that we have said enough in 53 pages and a 4-inch

             appendix -and perhaps the principal function of these hearings is for us to

             listen. What   is said at these hearings and materials which are introduced at

             these hearings will   be transcribed and given to each member of the Commission

             and th e Committee  of the Commission. The Commission will    then meet before

             adopting its final   report and consider the comments which have been made, the

             arguments. which have been. made, and the issues raised at these hearings.. We

             have imposed no time limit at other meetings with respect to comments. We

             don't propose to impose any time limits here this evening, and we invite any

             member of the audience who desires to speak with respect to the report to step

             forward, give us your name, address, and if you represent any organization, give
<pb n="708" />

                                                -3-

              us the name of the organization, and let us have your views with respect to

              the issues raised in the report. @Jho wants to. start off?, We'll start off

              on a different format. Does.anyone want to ask any questions about the

              Com-nission, or what the Commission has done or its policies if you are not

              prepared to make any statement with respect to the Commission's Report?

              MR. WEUE:

                   Is there any expectation that there will be a continuing review of

              land use planning over the next.decade?

              MR. BIOIVI:

                   Let me answer that question in an unlawyer-like fashim, directly. I

              think the answer is yes, but let me qualify t1hat in a lawyer-like fashion.

              The Commission has studied a broad spectrum of problem with,respect to land

              use, community development, economic development and the 'cost of public services.

              It has made a number of recommendations. In the bearings which have been held

              to date, we have heard the views of numerIous civic organizations, mments league

              of voters, and other organizations with respect to the report and the recommen-

              dations made. In the area of land usage and community development, there are

              29 policies recommended with respect to land usage/ccnnLmity development such

              as the containment of suburban sprawl, the development of residential areas

              around core urban centers, the preservation of prime farmland, recommendations

              of this kind. In the Econcimic Development Committee, there are numerous

              reccmmendations made with respect to economic growth. There's a recommendation
              made with respect,to a Statewide land use plan, and in the Cost of Public
              Services Section of the report -- the Cost of Public Services Section is really

              a warning rather than a recommendation. I think I can summarize the view of the
<pb n="709" />

                                             -4-

            Ccamission in the Cost of Public Services Section of the report in this

            matter. First of all, what we have done-for the first tim is to look at

            the reVenue sources of the levels of government in this State and the

            expenditures by the levels of government in this State, not simply from the
            point o:f view of the State's budget, the County's budget, the City's budget,

            but for the first.tim we've gone in and looked at all the money gathered

            in by the State, the three,Counties, the major cities, the 26 school districts,

            including the federal funds ukdch. cane into the State. We've looked at the

            expenditures by all these levels of government. Having looked at the revenues

            received over a period of 1968-1973, the expenditures made during the period
            from, 1§68-1973, the Commission has come to a conclusion that if conservative

            projections are made into the future, it is our conclusion that in the year

            1985, the State is going to face substantial deficits, would have to hTpose

            new levels of taxation,       levels of taxation in the State which the

            people,simply can't bear. We have said, and perhaps in context of what we

            have said that is new, that we need not, only look at revenue sources and

            expenditures, but we ought to look at the structure of goverrment in the State.

            We ought to look at whether we have too much government in the State. We

            ought @o look at whether or not the governments wt-Lich are -delivering the! services

            in thelState arethe proper entities to be delivering those services. Are the

            governments utdch are currently delivering the services the gavernments-which

            can best deliver the services fran the point of view of quality, and from the
            point of vimi of cost efficiency. Now, the reconnendations.as.outlined are very

            broad and cover a wide range. The hearings that have been held to date,-and

            not only in the hearings, but in the work of the ConuLission so far and in the
<pb n="710" />

                                                     -5-

               hearings which have been held to date, there I-as been an expression of an

               opinion that the Camussion shouldn't sinply file a report and, like old

               soldiers, fade away, but that there should be some mechanism whereby there

               is a citizen who'll review in the future whether some of these reconrexLda-

               tions are in-ple-nented and, secondly, there ought to be a continual, annual

               review of the policies which have.been recormended. I think that the touch-

               stone of the Ccnr&amp;ssion's report with respect to growth indicates that policies

               shouldn't be set dam in concrete, but they should be reviewed an an annual

               basis and how we accommodate ourselves to various developments should be

               reviewed on an annual basis. I would suggest       the need  for continuance of
               an organization, not this Connission, some     other body,   which:   (1) m'onitors

               growth developments over the coming years,      (2) reviews  the inplementation

               of the recomendations at various levels of government,        and (3) does sb

               from a broader point of view than the individual governmental units who are

               responsible for action. This Commission has a lot of citizen participation

               an it, and I think the view has been expressed that we need that going into

               the future. I don't think that these suggestions which have been made in

               the hearings are at variance at all with the feelings of the Caunission,

               although some of the Conutission meubers my feel that somebody else ought

               to attend the next year's meetings, but I think the Cannission menbers

               probably generally agree that there is a need for a continuing mechanism

               and a constant evaluation of growth in the policies we've set down and,

               their inpact on the State. I've tried to review where we've been, where.

               some of the pople have indicated in,@the hearings, where we ought to 90

               at any rate. Yes, ma'm. Would you state your name for the record.?
<pb n="711" />

									(6)

            NRS. HOPKINS:

            Lillian Hopkins
            Laurel League of Women Voters
            Laurel; Delaware

                 I understand that they made the statement in New Castle and Kent County

            that .(inaudible). Are any of these questions, at any time, going to be

            answered? There are sane direct questions in here.

            MR. BIONDI:

                 Let's take a look. Point out to me which question. What page are
            YOU reading from in, the League of Women, Voters. statement?

            MS. HOPKINS:

                 Page 4.

            MR. BIONDI:

                 YOU quoted from the statement by the League of Wanen Voters regarding

            Delaware Tomorrow Commission. report, page 4, and you've pointed out one of

            the questions the League has raised is an apparent conflict between certain

            sections of the Commssion's report with respect to the construction of

            highway systems. It's not that I didn't bear you, but I understand you
            couldn't be picked up on. the tape, and I was asked to repeat your question

            for the purpose of the tape. We are not going to answer those questions-

            in this context; we are going to distribute, hopefully by next Tuesday,

            transcripts of these meetings and all the questions which have been asked

            and raised about the Commission's report by members of the public, either

            by letter to the Commission, comments of various Commission members, or in

            these hearings. We are going to distribute the transcripts to the members

            of the Commission and to the Committees which are  involved, and we are going

            to ask the members of the commission to study the   transcripts, to study
<pb n="712" />

                                                -7-

              those questions which have been raised about the Camd-ssion's report, the

              viewpoints which have been raised, the argumentation that bas taken place,

              and then we are going to hold a meeting of the Cbmission, hopefully as

              early as January 20th, at which we will devote whatever time is necessary

              to research and consideration of any questions which have been raised

              about the report in hearings throughout the State. It may be necessary to

              refer some of then back to the C=Tnittees    the land Use Conr&amp;ttee, the

              Economic and Development Czau&amp;ttee, and the Cost of Public Services Ccrn-

              mittee, but we bope to have the Chairman and Vice-Chairman,of those Cam-

              mittees and the key people of those Conr&amp;ttees who have been working with

              the Ccm-aission att end the Ccunission meeting an the 20th. That my be a rather

              long work session. (John Walton indicates it better not be.) But, that's

              what we plan to do. We plan to take up all these questions and answer them

              before we publish our final report -- at least deal with the problems.

              NRS. HOPKINS:

                   I note that in an article I read a statement given by Mr. Bond, the

              bond expert to Mrs. Jornlin, was published in the Mbrning@ News and the

              figures an our average indebtedness and our average tax rate  per capita,

              particularly what be had to say and they were in direct conflict. I

              couldn't help but wonder which was right.

              MR. BIONDI:

                   Needless to say, we've noted his article and his ccmments. I think

              that the report was published and the Cost of Public Services Section was

              done before he made his comment, but I think that he perhaps read the report

              before be made some of his cowents. We were concerned, before he was, about

              the level of capital expenditures in this State and the ability of government,
<pb n="713" />

                                             -8-

           at all levels, to carry not only the State capital expenditures, but the

           capital expenditures which are made by our school districts, cities, and

           counties. The point of view expressed in the report is that the total of

           Operat    the continuation into the future ona pattern we've had in the

           p                                          tures and capital expenditures
            ast of both increase in operating expendi

           would put us in a situation where the fiscal stability of the State is
           seriously going to be in question by 1985 without large, additional revenue

           mea ures, and those large, additionalrevenue measures would be counter

           productive to any kind of growth and really be negative in terms of quality

           of life in this State. We've noted his comments, and have pointed out this

           overall fiscal problem in the State. Is there anyone else U*10 has a question

           or who desires to make any comments?

           MR. SHOWALTER:

           A.K. Showalter
           Citizen
           Georgetown, DeLTdare

                I,find the report to be excellent, very progressive outlook. I'm
           particularly pleased with  the section on transportation systems since I've

           been-involved with the evils of this having been to Los Angeles, in@the

           smog area, and Washington, D.  C., where it's taking 40 years to build a

           subway.and great excess of  the mml)er of cars, and I like some of the

           relationships brought out between urban sprawl and the reduction of the.

           number of cars and the new attitude toward mass transport, particularly the

           comment an clearing the streets of auto storage. I think this is a very
           unique.way of telling it; whether the car is parked or moving, it's still

           storag@ on city streets. Having lived off Connecticut Avenue where there
<pb n="714" />

                                                -9-

              was six solid lanes of storage from 5 o'clock in the morning until 11 o'clock

              at night, I can appreciate this. The courage with which you attacked the

              restraint of the expanse of utility systems to realistic values, I think this

              is sanething that should be amplified. The protection of the farmland, being
              the possessor of 8 acres,'Vm sensitive to that. I have spent quite a bit of

              time in 23 years in the Weather Bureau and 12 of that was involved in water

              resources and quantity of rainfall forecasting and in the Los Angeles area we

              were involved with heavy rainfall forecasting, etc., so I'm quite sensitive

              to the problem of water. I adopted Delaware when I retired after considering

              several other States because (as I told nrj wife) you may get water up to your

              knees sonetimes but our house is never going to wash down a ravine. Also,

              from the standpoint of rich agricultural land we have here, and the fact that

              there is so much water available in all directions, Sussex County is only 14

              miles from water, east, west, and also there is a good supply of water under-

              neath the ground all the tinie. On page 30, to be specific, there is a refer-

              ence to favorable climate. This is talking about the climate of econami-c

              growth and whether or not the climate for business would be recognized as a
              good place to be. I thirk this is n mistake, because I think the word "climate"

              should not be usurped for eco nomic exploitation. Actually, climate, weather,

              water are the most valuable economic resources of Delaware and they should be

              exploited on their awn. As a negative emphasis, I have some questions on the

              emphasis on the increasing industrial.development in Northern Delaware at the

              expense of the potential in Southern Delaware. If you concentrate industry,

              You'll concentrate population, and this gives an overburden of taxes --statewide

              tax exploitation to the heavy industrialized areas. Now,  having done sorm
<pb n="715" />

            research for the Weather Bureau, and trying to satisfy custaners, I had some

            long discussions with the Bureau of Census people who were not in the same

            department and Iasked them for figures on industrial density. They said all,

            you had to do was look at the population density   the two were so highly

            correlated that they don't make separate tabulations of industrial density.

            So these are factors to consider. The increased enphasis on water resources

            of Delaware and I think the fact that we have water to the east, water to

            thevest, and below the surface, and also ample rainfall.for many agricultural

            purposes, there has to be more ingenious Tmthods developed for the storage of
            water in the aquifers, the recycling of water which is mentioned as a good
            agricultural practice, by spreading water so that it won't get back into the

                         there's some very good samples of the right handling of water
            aquifers, and

            planning disbursenents in the report, but I think this could be developed a

            little bit more. Now, I don't kiow if anybody frmn Geological Survey is

            bere. Dr. Jordan is an one of the Technical Cam-Littees, I noticed.

            BIONDI: He has attended the other two meetings.) Charging the,-water An

            the aquifers is something, maybe you've done scmething since I visited here

            several years ago before I wved to Delaware and found out what is going on.

            I think the analysis of the aquifer structures, what should be done about

            recharging, how we can coubine the preservation of the swamp areas, and the

            wildlife areas, and the open spaces, things of this nature and staties of

            the soil structure, the vertical tenperature profiles, the water ma vemmt in

            soil. Right today most of the water in my farm is standing uT at the top
            because the surface is cold. If I could turn on the sun and get up to 80OF

            teMeratures, that old water would disappear and go dam into the ground.
<pb n="716" />

              Not enough work is being done on this, not enough support is being given in

              this phase in coordination with aquifer studies, recharging, etc. These are

              angles where we can develop the agricultural potential of water resources

              potential. Now another thing is the overall energy.

              MR. BIONDI:

                   Pardon me for a m:Lnute. Let  me ask a question here.  It's been my

              impression that the discussion about the recharging of aquifers has been

              considered mostly in reference to a supply of water for residential uses

              to date. You're talking about the recharging of aquifers primarily from

              a point of view of an agricultural use at this time.

              MR. SHOWALTER:

                   No, this is scmething we have  to face simply if the population of

              DeL%%mre increases; for example like Iong Beach, California did. You 11

              really get salt water intrusion coming in from the ocean. Also, instead

              of having water run off into the ocean, if you can delay it.long enough

              so it goes through the soil. Otherwise, we can't keep Aquifer water

              supplies going. Eventually, we will have to depend on. the above it, if

              you devise means to store the  water in the ground. Now  they do this in

              the San Fernando Valley in California. During the winter rains,. they

              spread the water out and then they pump it back up in the summer to use it.

              They've dom this on Izng Island, @,d they've done this in roany places.

              It's a long, cccrplicated subject, but one that should be treated for the

              handling of water in the future. Another point, I think there's   a good

              potential for an integrated study of all of  the energy sources for Delaware.

              I'm speaking of wind power. The wind doesn't blow, but we need the water

              pressure for your crops, but  you could use wind power at certain seasons of
<pb n="717" />

                                              -12-

           the year to save on other energy. Solar power      now this I think is being

           discussed or planned at the University of Delaware. I'm not satisfied with

           the hours of sunshine that were integrated into the potential for use of

           solar power. In this climate, we get 9 hours of sunshine in tlie winter

           months, possible sunshine, and 15 hours in mid-summer. There's nothing we

           can do about getting 15 hours of sunshine in the winter when we need it,

           but we can't do it by changing the daylight savings time. There's a possi-

           bility of combining the maximization of solar power and wind power and since

           weire only a short distance from. the ocean, I don't thirLk we should give up

           so easily to -- very sincere environmentalists who think that nuclear power

           and water desalting are curses. I think there's a great potential for these

           two, and the energy fran salt water is also something in the future. So

           Delaware is close to nony sources of energy that could be integrated into a

           total picture. I must be over my time.

           MR. BIONDI:

                 Well, like I said, we weren't inposing any time limits and we want

           do that.

           @R. BRYSON:

                 We have done aquifer studies throughout the State, recharge studies,

           and I'll be happy to'give you:a copy of this if you'll drop by my office

           sometime.

           MR. BIOMI:

                 That was John Bryson, Secretary of Natur-91 Resources and Environmental

           Control speaking.

           MR. SHOWALTER:
                 Well, I didn'.t say that theybaven't been doiio- They'll been done
<pb n="718" />

                                                 -13-

              in other States particularly, but I think this is something that  should be

              emphasized in Delaware Tomorrow, hopefully, there will be a second tomorrow.

              MR. BMWN:

                   What we're doing here is to point  out the problem areas and then

              emphasize, in greater detail, the individual aim with wftich to carry it

              out. Work is going on, and I think it highlights uiiat they want done and
              we'll pick it up and go froTn there.

              MR. 'HICXMAN:

              Len Hickman
              Secretary
              Dept. of Public Safety

                   The thing I'm concerned about in your 7 categories     I don't see

              resort areas in there.

              MR. BIONDI:

                   I think if you'll look in the area of the Economic DeveloMent report,

              I think the Economic Development C=u&amp;ttee bas pointed out the important

              place that tourian plays and one of the recommendations that the Economic

              Development Counittee has made is that the State do more to point out its

              historical and cultural attractions and promote tourism. That's been

              covered in the Ecorcmic Development ConuLittee report.

              MR * BUMN:

              Wayne Burton
              Millsboro, Delaware

                   If I understood your explanation correctly, I believe that we just

              realized that the Northern part of the State where there is a predominantly
              larger amount of labor we'd say, could be in the future, industrial, and

              more or less reserving the lower county for-tourism and agriculture. Am I
<pb n="719" />

                                              -14-

           correct in that?  Wasn't that a surmation of it?

           MR. BIOMI:

                I don't have that iupression. I think that inpression may be gotten

           from the fact that it is there now and we're talking about using old

           industrial buildings already-developed and developing around urban centers,

           things of that kind. I think me of the key economic problem that was

           pointed out by the Economic Development Ccm-fLttee (mybe Joe Conaway can
           help me with this), but the City of Wilraington and the western section of

           Sussex     County were pointed out as areas which had suffered economic
           recession over the past 10 years -- so I don't think that there's a

           recognition of the problern there. I don't think there's an attempt to

           deprive other parts of the State of industrial development.

           MR. BURTON:

                I went along with that recom-.endation. I thought it was a good one.

           The -LIAng that came into ay mind, on page 46, what about the Coastal Zone

           Act as it rim; stands. It seems that there is a recommendation there to

           replace it? The first recoamendation on that page -- I didn't quite under-

           stand it, replace it with what?

           MR. BIOIMI:

                Replace it with a Statewide use plan which would be a plan mt-dch

           would coordinate, complement, local planning in the terms of county planning,

           and in so me cases, city planning in areas which are of critical concern such

           as the Coastal Area and which would indicate the lases wfidch could be made in

           various areas of the land in that area rather than having a blanket prohibition,

           as exists,in the current Coastal Zone Act.
<pb n="720" />

              MR. BUMON:

                   The basic things of the Coastal Zone Act then probably would be changed?

              MR. BIONDI:

                   'I wouldn't -- I think to say that would foreclose what's going to take

              part in that planning process. What we've said is that the.State needs a

              Statewide Land Use PLan. That these interests are not interests which are

              peculiar to the counties they affect the welfare of the people all over the

              State, and there should be a Statewide Land Use Plan which indicates the

              basic premises for which land can be used in areas of critical concern.

              How that Plan comes out will be a matter of the expression of the interest

              of our citizens as this develops, and approved.

              MRS. HOPKINS:

              Lillian Hopkins
              Lewes, Delaware

                   On page 39, 1 was intrigued by this recommendation:  'The State should

              study a revenue-sharing formula for commercial-LiUsteLal reva-iue so that

              all jurisdictions of our small State will share in the revenue equitably."

              Can you expand on that?

              MR. BIONDI:

                   Well thatis a recommendation which has been opposed by the Civic League

              of New Castle County, the New Castle County Government, and practically

              everybody else -oft has spoke to it, I believe. I think that the basic premise

              of the Ccmmittee which recommended that (was that in the Econcmic Development

              Ccuudttee recommendation?) was that the location of industry in any particular
              area and if you take the area of New Castle County, you'll locate a large

              industry in that area, you're going to have an inpact not only on the school
<pb n="721" />

                                              -16-

            district in wi-dch that industry is located and. the town in %hich it is

            located, but you are go ing to have an inpact on. services on a much
            broader area.@ You're going to have an inpact an State Gavermient in terms

            of the services, the money it provides for education. You're going to have

            an impact on. the State Government in terms of contributions to utilities

            for raods to service that irxJustry. You're going to have an inpact on

            State Goverrmmt in terms of (we LT.4yers tend to think of all the negative
            things), but if you bring a certain number of workers in here, you're go U119

            to give me a certain number of "driving under the influence" cases and a

            certain number of family court support cases, etc., and you're going to have

            some institution, more judges, and public offices, things of that kind.

            There is a State impact, there is an impact on, the County, there's an inpact

            on. the City, andthe basic them here was to have the tax fruits of the loca-

            tion of that industry in the State from a  real estate tax point of view

            shared among 411 the units of government uhich are going to have to spend

            money because that industry is here. Well, if it's located in New Castle

            County, it's going to have an impact an the State Government, it would seem

            that the State should have some share in it, in terms of the State expenses

            w-bich are going to have to be borne with respect to it. We look at the

            State from the point of view of the Government which is involved in the

            problem. It doesn't mean if the industry is located in New Castle County

            that taxes would be paid to the Council in Georgetown.

            NRS. HOPKINS:

                 Yes, that's exactly wftat I mean. I think this is a very ambiguous

            statement., It doesn't say what it really means.
<pb n="722" />

                                               -17-

             NR. BIONDI:

                   It may be deliberately ambiguous, but I think enough attention has
             been  devoted to it that it's going to have to be sharpened up. It my

             not even survive. Joe Conaway is laughing.

             MIR. CONAWAY:

                   ... share in the payment of those taxes too. Are we going to have

             to raise our taxes in Sussex to correspond to levels in New Castle.  That

             point was made and that's where the problem comes from.

             MR. HICIM:

                   The complexion of,the State in Sussex is so much different that it

             would be bard to make a uniform law to bit the whole State. Our complexion

             here is that we have a mixture of agriculture, resort and light industry.

             But, in New Castle County it's all industry.

             M. BIONDI:

                 . No, good heavens, are you kidding? I have more park land within 3 blocks

             of my residence in the City of Wilmington than I bet you do here in Georgetown.

             If you guys from downstate will vote for that Bringhurst.Woods appropriation.,
             or if you already did, I'll have more parkland,, more woods to run through

             before I get down here. I appreciate your point, Mr. Secretary, that areas,

             in the State, not only from the point of view of counties, but areas in the

             State in the same county, have different make-up, different resources, differ-

             ent attractions, :L-Z there is no attempt to impose uniform policies with

             respe ct to development on, all areas.of the State. We have different interests

             and the policies in our State Government reflect those interests and they

             WIll continue to. There is no ma ter plan being suggested here because things

             just don'thappen that way in the real world --nor should they.
<pb n="723" />

								-18-

            MR. RUSSEL:

            Carl Russell
            New Castle County, Delaware

                 As I recall one of the primary points that brought tbis whole. question
            about was the concern to school districts; particularly, there is a

            large amount of tax exempt property, particularly me south of Wilmington.

            There is a large sanitary area, highways, county and State public land that's

            all tax exempt.

            MR. BIONDI:

                 They only want to tax the bridges, the River and Bay Authorities.

            MR. RUSSELL:

                 Your tax base has been cut and, therefore, there should be some way

            to (guess the word would be) to-reimburse them for some of the expenses

            they have because their numbers of children may be as large as our district.

           .This is only one of the item that brought this subject to discussion.

            MR. BIONDI:

                 Yes, it's a multi-faceted issue. Is there anyone else who would  like

            to make a coment or talk about the report or any of the issues raised in

            the report?

            MR. WELCH:

            Thomas Welch
            Dover, Delaware

                 Representing 'Watch Our Waterways" a citizen's group of approximately

            400 members. 'Watch Our Waterways" would like to commend the Delaware

            Tomorrow Commission for the orderly approach toward growth and development

            rather than the piece-meal approach we've had in the past. I think you and
<pb n="724" />

                                                _19-

              the State Government should be cmmended for taking that approach. With

              this plan, %hich is widely accepted and widely understood, it gives us a

              chance to correct its land mc)difications in the future that is part of the

              plan. That1eads to the question I was asking in the beginning regarding

              the mechanism to have continuous citizens review and monitoring so that not

              only are we able to say something now M=t it, but if the plans are de-

              veloped in the future, we will kmw what that mechanism is and we'll be

              able to speak to it. One of the specific things that I think 'Watch Our

              Waterways" has been most concerned with is the language of the Coastal Zone

              Act. I think maybe to avoid one of the most controversial highlight areas

              that may represent to a lot of people a big conpromise if you do go all the

              way and w-ash it out in the process of planning. If you have to go dawn

              the line without assurance, without knowing what chances are, you don't want

              to trust to chance what will happen, if you do make this kind of compromise.

              In a matter of urgency and extreme crises as we've been in regarding the fuel,

              Arab boycott, the petroleum prices, vma, as the people, are te mpted to make

              too many cmprcmises to meet supposed crises. Today, for a variety of

              reason , douLnating the views of Delawareans, is the idea that a superport

              is neither inevitable nor necessary, even though your report,does suggest that

              it be considered. How quickly our d-iin1dng becomes ouUaoded if we allow

              crises to dictate our policies; ratlier than rational, long-term planning.

              The Coastal Zone Act should be a continuing part of land use policies.

              Such is also the case, with less kTiown environmental protection legislation,

              such as Wetlands Act and Beach Act. -Lhe report includes, as one of its

              underlined policies, page 24, that "Delaware sho,61d contix@ protection 6f-the
<pb n="725" />

                                              -20-

            coastal and estuarine areas throughout the State." There could be no better

            way to do exactly that than to maintain the Coastal Act in its full form as

            well as The Wetlands Act and Beach Act. It has been reported in the

            Jaruiary 7th Delaware State News that the Chainrian said that keeping the

            language of the Coastal.Zone Act had not been looked into. I would suggest
            ,-6bpi all persons interested in contimdng protection of the Coastal Zone

            and estuarine areas, as called for in the Cammission's report, support

            inclusion of the Coastal Zone Act intact with the State Plan of Land Use.

            I think we should also consider a plan of land protection, not just use,

            but also land protection. I think it does speak of that. Another item

            which is a rather general one wJhich has to do with the need for growth

            not the need for growth, but the assumption that growth is good.    Growth
            should be via-7ed critically, not to assume that it's automatically good.

            And further, that more growth is even better. One sure way to increase

            the population if that be our goal, is that we have the largest welfare

            payments in the Natim    that would insure substantial growth in population.

            Such growth may not be in the best interests of the State. I think that's

            a ridiculous example, but if we're out for mme growth, I think we can do so.

            HL BIONDI:

                 Let me ask you a question., Mr. Welch. Have you read the section of,

            the report from which we discussed the economic development projection7

            NR..WELCH:

                 I understand the report as you have heard.

            MR. BIONDI:

                 Let me ask you diis. Do you think it's an over-cmcession to growth,
<pb n="726" />

                                                 -21-

              too much emphasis an growth? To discuss growth in the term of being able

              to provide a number of jobs for the natural growth of the population already

              in place in the State 10 years with no net in-migration population? Yes,

              that's the fundamental premise of this report with respect to economic growth.

              I don't think that the Cmnission's report is either overly optimistic or

              overly supportive of growth, per se, nor is it one which is laudatory of

              growth for the sake of growth itself.

              MR. WELM.

                   A final point. The need for some kind of process for continued citizen

              monitoring in view of participation in it and I'm not here to make this

              recommendation. If there be an opportunity for continued citizen partici-

              pation at a future date I think wewill be prepared to do so at that time.

              MR. BIONDI:

                   Fine, thank you for your comments. I do want to make two conuients:

              one, wten I said it may have been the "sexiest" issue in the report, but

              maybe not the most important. I have a healthy respect for sex so I wasn't

              downgrading the issue, but what I was saying is that there are icebergs
              around in this State. I think'some of those w'ho,weire concerned.about the
              Coastal Zone have argued in the past that it wasn't the Coastal Zone Act,

              but the controversy of the Coastal Zone Act that created some of our problem

              in terms of the negative image of tlie State in the minds of business, can-

              mercial and in&amp;Latzial leaders. Let that idea sit there for a minute. Let's

              take a look at another point; that is, if you read the report carefully as I

              view the report, ther e would have been serious economic problems in this State

              and serious problem of finance in the public sector independent of that
<pb n="727" />

                                               .22-

            controversy over that issue. The sections of the report dealing with Land

            Use and Cmnwdty Development were harder to focus public attention on. it's

            I-larder to see whose ox is being gored there, but in the long run those poli-

            cies or the absence.of policies at that time that the CamrLssion has recan-

            mended, are having a very serious effect on. the quality of life in the State

            and on the cost of, public services in the State. The other reccimmendations

            welve talked about in the Econcmic Development Section are important to the

            basic economic structure of the State and the cost of public services section

            in the report waybe the most critical portion of the report. If we are con-

            cerned in this State today about the high inccme tax, the highest level of

            tax of 19,811, in capital gains, how nuch more would we be concerned about

            economic development in t he State if we had to impose entirely new levels of

            taxation on our people and on business and industry in the State? When I
            said that, what  I was trying to do was'nerely put the entire report in per-

            spective. That may be one of the most talked about issues, but if you were

            to solve that problem alone, in rTj judgment, you would not acccnplish a

            helluva, lot in term of the basic problem that we have identified. The

            other point is one which the Com-nission is increasingly concerned with.

            There was a lot of shouting and hollering in the State prior to the time

            the Czmaission was created about some of these policies and scme- of these

            problem. I think the ability of citizens to sit down and talk to each

            other across the table about it with some kind of structure/forum and for

            a continuing citizen participation in the process, has been one of the

            good things about this Commission. 1 think that the members of the Cm-

            mission realize that some structure has to be developed to be able to

            continue this as we go down from. this point on out.
<pb n="728" />

                                                 -23-

               NR. WELCH:

                   The most noise about the Coastal Zone Act, in my estimation, would be

               not as it was passed originally, but a chance to soften it even almost dis-

               mantle it uiien the Arab oil crisis started two years ago. The heat and

               furor were greater at that time than it was in the past.  Those who supported

               it originally were very happy not to have had that beat and discussion and

               debat carried an. I think the will of the people of the State of Delaware

               was, until we can be-sure-about the protection, the safeguards that are

               built in, don't talk to us about heavy industry in the coastal zones. I

               think that as technology improves, and the mandate is there, public opinion

               may swing the other way. I think it is a sexy, controversial issue and I

               think that's why it is. I don't think the people want this to be the same.

               MR. CONAWAY:

                   I didn't come to speak; I came to listen, but when you said something,
               Mr. Chairman that I couldn't let pass because I'm going to agree with you
               and that's been a long time coming. The point was-an growffi. We agree 10T.I.
               that we're out to recruit industry, but we're not out recruiting industry to

               bring in 300 more people. We've got to do something about our industrial

               climate in Sussex County and I'm very interested in the building and the few

               people who have to come with it, but we want our people to work. A point

               that is missed throughout all of the conversation has been the median age for

               the people of StLssax County - 28. We're losing our young people and we've
               got to do something about it, and to do something about it, we've got to

               bring industry in. But not industry that's going to bring 4,000 people with

               them, we're not interested in that. That's why we're trying to develop plans

               to train our people in any of the skills that might be necessary for the off-

               shore drilling tbat's sure to cotne; so that our people have the opportunity
<pb n="729" />

                                               -24-

             for those jobs. I did want -to make a point that I do agree with that much

             of the statement thatwe are not interested in bringing in large numbers of

             people. we'd like to keep our young people here.

             MR. BIOMI:

                 Joe, I think there is another area of the report where that's sort of

             indirectly emphasized and that is in the section of Econcimic Development

             CaTmittee report -,ddch speak of the necessity for using the improved systeni

             we have for technical training and education in this State to match up the

             abilities of our people with the type of industry we want to promote in

             the- State.

             IM. WAL-LON:

             John Walton
             Delaware Faimi Bureau

                 It's a curious thing Joe, since you mentioned that the median age
             is 28 and you're losing your youtli in Sussex County because the average age

             (tHis being our largest agricultural County) of your farmer down here is 52

             years old. Enrollment in the University of Delaware in the Agricultural

             College has increased some 400'/. in the last two years. So it seems a peculiar

             ddr)g- to me, as probably one of the holders of preservation of agricultural

             land, d-lat these two things seem to be inconsistent, to say the least. I'

             nv_,-an if tl-wxe was ever a need for farmers in this County, it seem like there

             is and our enrollment in our University is swollen over its bounds, asking

             for budget increase s unheard of. Yet, there're trying to bring industry

             here. They've go t the most desirable industxy  in the wrld here and it's

             our largest agricultural County.
<pb n="730" />

                                                 -25-

              MR. BIONDI:

                   I knew we were going to, get that band of vultures frm Winhidngton

              sooner or later from the outlands.

              MR. CONAWAY:

                   The outside influence of undesirable pleasures for what the citizens

              of this State want. Now, Mr. Slawik, last night    (maybe youIcan summarize

              it better than I did) said what we're trying to do is close the door and

              not let anybody else into this State. He said that in jest, but we're not

              suggesting that. I think what you said, Frank, is a very accurate summary

              of what we're saying. We're not asking our youth to leave this State, but.

              if you're asking us to open up nuclear research stations becaus  e there are

              a number of youth wi-io want to study nuclear research, I don't think that a

              State with a half million people can do it. -- not with our business going-

              in 40 years from 0 to 500 million. I mean what can you afford? It's what

              the Delaware Tcmorrow Commission has looked at. I just think this thing

              about median age and youth leaving -- if you want to live in a certain State

              in this Country, wherever it is, you're going to find a place to fit in vftt's
              open there. I Rddxik that technical colleges and those kind of,things are a

              big answer for something we haven't had to work with. In the next 10 years

              they'll have a lot rwre history than what they're going to do to help in

              this problen.

              MR.BIONDI:

                   Thank you, John. Are there any more members of the public who wish to

              be heard or who wish to ask any questions?
<pb n="731" />

                                             -26-

            MS. 11OPKMS:

                One of the problems is the anti-business image, but I recall u+Len

            the Coastal Zone Act was passed and the Wall Street Journal lawyers and

            Mrs. Witt wrote an article attacking the Coastal Zone Act. They    said

            there isn't any business out there.

            MR. WALTON:

                Mrs. Hopkins, at one of our meetings and it's not in this report (I

            don't know why), but there was a large discussion about one of the biggest

            anti-industry image things - the tax structure for t1-Le higher level top

            executives in Delaware. It was really emphasized for about 10 minutes last

            night in one speaker's speech in New Castle County. The fact that one
            $85,000 executive pays as much tax as 21 $10,000 employees or as 10 $12,000

            employees and this is certainly not a climate -- this is an anti-industry

            image when you tax one executive to that extent. So this is as much a large

            contributor to the anti-it-idustry image -that was brought out.

            MR. BIUM:

                Well, I think the Cotw&amp;ssion has pointed out -- it's in the report.

            The fact that 19.8'i'o tax of the upper level State incom tax arid IOM'. tax

            on capital gains and the lack of a ceiling on unearned incorm is in the

            report and is one of the irajor economic problems we face in the State. I

            think that the crux of the report in terms of that, however, is that if we

            were to solve those problem somehow, and solve those tax problems and we

            were not to adopt some conservative policies @,@.th respect to land use, and

            do s(mr- positive things with respect to econcmic development, and if we

            continue with our c:urrent governmental structure at the same rate of opera-

            ting capital expenditures that we have, we'll wind up with a problern 10 years
<pb n="732" />

                                                 -27-

               dam the road that will make the current problem with respect   to these taxes

               seem very minimal. Is there anyone else %iio wishes to speak or be heard or

               identify himself for tlu-- record as having been here or make any other comments

               or ask any questions?

               MR. HARFUMN:

               George Harrison
               Rehoboth, Delaware

                    I haven't read the report; just picked UP a copy of it,  but I don't

               think that tourism has been eaphasized. I consider it to be   a very large

               part of the scene in Sussex County even though sometimes it doesn't seern to

               be looked at that way. There's a lot of emphasis an industry from other

               States, other places, and the beaches right now. Of course, maybe it's due

               to the rainfall, I don't know, but Rehoboth is having a controversy over

               the beach fees, same as New Jersey has. I don't think much has been done

               in Delaware to promote tourism as nuch as could be done considering the

               matter of economic input into the State's system wiiich would do a whole  lot.

               I don't think it's very well represented as recorded in that account. Maybe

               I'm wrong, as I've said, I haven't read it all, Also, I see you've mentioned

               in there the zoning and the fact that strip zoning in the areas of (inaudible)

               aren't too good and I'll go along with that., It seems that in the last few

               years since I've been back in the Stare, you can take areas that used to be

               bare and those areas that have utilities and the areas that don't have utilities

               are being promoted and the municipalities are going out on a limb with bond

               issues and everything to give new developments utilities wi-iere they have

               utilities already in areas that are not being used. This doesn't seem to agree.
               Why spend money when you've already spent money for what you.'re spending money for?
<pb n="733" />

                                               -28-

             I think the present Coastal Zone Act is a good thing. I think it can be

             applied Imre in some ways, but not drastically. I think some con-promises

             can be iiade. I think it needs to be taken a long look at before these

             changes are made. The beaches are a very valuable part of Delaware. The

             wildlife areas,,from just below Delaware City, are -- all the way dam

             to the bottom of Delaware -- the 4iole thing is a mess. Heavy industry,

             I think, would probably hurt us. I realize I m not asking as many

             questions as I'm makirV,, statenents. I think that in the last few years,.

             t1ae State is all for a lot of services and the people receive a lot of

             services, and the people demand a lot of services and there goes our taxes.

             Are these services adequate? Are they needed? Are they doing what they're

             supposed to do or are they being manipulated by people or departments that

             have been created by departments that have been created by depart-.ients, or

             sorkv stu_-h tlAng as this. Is our Goven-unent really effective, is what I'm

             saying. As Mr. Conaway mentioned, vr,- should be ready for off-shore develop-

             amt as far as aployment goes. Our people having skills really valuable

             for,Wmt's needed there. As lie says, it's inevitable that it will happen.

             All these things should be looked at conservatively, cautiously, and in

             saw- ways, they. should be looked at real hard. In the future, I think    that

             there,should be a Conraission. like this one.

             '11R. BIONDI:

                  Thank you for your camients, Sir. Is there anyone else 4io desires to

             be liea d?
<pb n="734" />

              MR. SHOWALTER                    -29-

                   I recently made a trip out to my Imie State of Iowa, where I grew up

              one of ten boys on a fan-n. All of us left because nobody could feed us

              unless we made another farm. A horrible thing struck rip- while I was out

              there - heavy industry has taken over all of Northeastern Iowa, trying to

              take it over in the form of large corporate farms. My younger brother,

              who is a Soil Conservationist, Fishing and Hunting man, is just going,com-

              pletely wild because the 80-acre farm, the 160-acre farms and 320-acre

              farms are being bought up by large corporations who are converting them

              into 2,000 to 5,000-acre farms, tearing up the Township roads, filling

              them in, filling in the drainage ditches, etc. They  have cmputer pro-

              grams for planning which areas are to be harvested and, planted throug[iout

              the year, and tremendous big industry has taken over the small farmer of

              Iowa and you.can't find the typical local farmer anymre.

              M. BI014)I:

                   I guess the key question is can land be planned to prevent that?
                    John, do you care to touch that? You don't have to.   I'm staying

              out of local problems. Is there  anyone else who desires to be heard?

              MR. ISAACS:

              Martin Isaacs
              Secretary of Agriculture
              Farmer
              Sussex County

                   I want to ccopliment the Cconission. I think they have done a

              wonderful job and have come to scne excellent conclusions. I'd just like to

              say that I do agree with the reccmTv--ndations an page 46. 1 think we should

              have a distinct Land Use Policy Plan and I think that it should involve the
<pb n="735" />

                                             -30-

            County Goven-nent, the State agencies, the mzdcipalities, and I think    it

            should continue to encarpass such things as the credits we have, such as

            the Coastal Zone Act and the other laws that we have presently that deal

            with land assessment, particula rly agricultural land. I'd like to turn

            bark and.offer a suggestion that first of all on page 21 -- I'd like to
            see us @:, see food and fanns, but not just food alone. I think we realize

            we cannot exist with just food, we have to have fibers for clothing, con-

            struction and this I've noticed

            MR. KOMI:

                 I'm a city boy, Martin, but when youtalk about fiber you don't

            mean nylon, do you?

            @R. ISAACS:

            Nylon is a fiber but the fiber produced m the Land is generally regarded

            as cotton; that's the min fiber, but as pointed out, and this is particularly

            relevant,to this area where we are right now, the production of soy beans

            which is a food, fiber and an oil. I think this is very significant, and,

            of course, we also have to relate to our tin-ber production here in the State

            of Delaware which is a vital part of our agricultural industry as a whole. I

            noticed it has not been referred to, but certainly we have a large production

            of pulp wood which is fiber and that as well as tirrber. I'd like also to

            point out that on page 22 it's stated here: "Delaware should preserve and

            protect its prime farmland as defined by the U. S. Soil Conservation Services

            but includes land classified as I, II, and M." I don't want to get Into the

            technicality of this, but I'm not surE that this for Delaware is the way that

            we want to classify prim land. First of all, I had mentioned timber, but this
<pb n="736" />

                                                 -31-

               is a technical.classification  for the soil conservation of the United.States

               Govennent and deals with definitions   that include topography, the terrain,

               and the drainage water levels,.etc. Now, to some people, prime farmland

               means, a piece of land in its.basic existence that will produce a prime crop.

               I'd like to just briefly point out vhiat happens and what has happened in thi s

               area where we are tonight and particularly south of here as   a result of

               such dAr4,,s as soil conservation and drainageand the practices of soil

               stewardship and the-advent of the great poultry industry  that we have here

               where the poultry manure has been added to the other soil practices of

               stewardship and has turned land that was formerly not prime farmland or

               would not qualify as prime farmland, has turned it into prime farmland

               and to these people this is prim'land when we get down   into the individual

               consideration of it. I'm sure that you can never convince them that any
               definition out of the soil conservation service that their land is not

               prime, because they have made it prime farmland by tbeir practices, and it

               'has turned out to be that way. So, I would suggest that you do give con-

               sideration. to maybe not a recommendation of the determination by U. S.

               Government definition of what prime farmland is, but establishment of a

               definition that would relate to our varied types of land and our varied

               practical situations that we have on the farmland in Delaware and the

               woodlands. Again, I would say that I think it is a. very excellent peport

               and I certainly compliment you, Mr. Biondi, aid meabers of the Coomission,

               and the Cemnifte'es that'have worked so bard on this and I think you've made

               a great acccmplishnent. I, too, would like to see some follow-up group.

               However, whatever it be, to pay attention to what goes on  in the future years
<pb n="737" />

                                            -32-
            because of the iniplementation of these recannendations in the report.

            MR. BIONDI:

                Thank you, Mx. Secretary, do you want to take the opportunity over

            the next several days to frame a reconum-idation-as you would say it with
            respect to the preservation of fannland in lieu of the recommendation

            welve made and be in contact with us?

            MR. ISAACS:

            I don't think that should be done by me, alone. -I have consulted with

            our State Forester an this subject and he has the same considerations.

            MR. BIOMI:

                You needn't be,concerned about any recommendation being accepted

            without argu-nent. Okay, that's another question we'll have to take a

            look at. Is there anyone else who wishes to be heard? If not, we-Will

            close this meeting. Thank you for your attendance and your ccmments.

            Attendance   approximately 50.
<pb n="738" />

                                           LAND VALUE TAX COMMITTEE
                                                                         OF DELAWARE

                                 PROPERTY TAX REFORM TO HELP REMEDY ECONOMIC &amp; SOCIAL                       ILLS OF OUR TIME

               CONCEPT:                       TAXING OF PUBLICLY-CREATED LAND VALUES MORE FULLY, RATHER
                                              THAN IMPROVEMENTS, WOULD BEN
                                                                               EFIT THE ENTIRE 'COMMUNITY
                                                      PIERRE SAMUEL DU PONT DE NEMOURS, ECONOMIST                   1800
                                                      HENRY GEORGE, ECONOMIST, PHILOSOPHER                          1890                14 19/6
               PAST &amp; PRESENT                         EDWIN P. NEILAN, BANKER, CIVIC LEADER                         1965
               PROPONENTS:
                                                      MAYOR'S FISCAL STUDY COMMITTEE                                1969
                                                      U. S. CHAMBER OF COMMERCE RESOLUTION                          1970
                                                      U. S. SENATE COMMITTEE ON GOV'T. OPERATIONS                   1971
                                                      AMERICAN INSTITUTE FOR ECONOMIC RESEARCH

                                                                                                                               GREEN LANE
                                                                                                                        ARDEN, DELAWARE 19810

                                                                                                                        January 12, 1976

                         0. Francis Biondi
                         Chairman
                         Delaware        Tomorrow Commission

                         Dear Mr.          Biondi:

                         Enclosed        find an updated and                   more complete             copy of my remarks
                         as presented to the Delaware                          Tomorrow Commission.at its public
                         hearing on January 7th.

                         We thank you for the op
                                                                    portunity to have participated.

                                                                                        Siriegrely,

                                                                                        Frank E. Nelson
                                                                                        Co-chairman

                                                                                                                                  T,   T V
<pb n="739" />

                                     LAND VALUE TAX COMMITTEE

                                                                  OF DELAWARE

                           PROPERTY TAX REFORM TO HELP REMEDY ECONOMIC &amp; SOCIAL ILLS OF OUR TIME

          CONCEPT:                      TAXING OF PUBLICLY-CREATED LAND VALUES MORE FULLY, RATHER
                                        THAN IMPROVEMENTS, WOULD BENEFIT THE ENTIRE COMMUNITY ...
                                               PIERRE SAMUEL DU PONT DE NEMOURS, ECONOMIST                  1800
          PAST &amp; PRESENT                       HENRY GEORGE, ECONOMIST, PHILOSOPHER                         1890
                                               EDWIN P. NEILAN, BANKER, CIVIC LEADER                        1965
          PROPONENTS:
                                               MAYOR'S FISCAL STUDY COMMITTEE                               1969
                                               U. S. CHAMBER OF COMMERCE RESOLUTION                         1970
                                               U. S. SENATE COMMITTEE ON GOV'T. OPERATIONS                  1971
                                               AMERICAN INSTITUTE FOR ECONOMIC RESEA     RCH

                                                                                                                        GREEN LANE
                                                                                                                 ARDEN, DELAWARE 19810
          STATEM@NT PRESENTED AT THE
          PUBLIC EZARIt4G 1/7/76 02 THE
          DELAWARE TOMORROW COMKISSION

          This Committee agrees wholeheartedly                                with the recoffnendation by Mr.
          Eugene J. Lipstein, President of the                                Civic League for New Castle County,
          that the time has come for "local governments to take a hard look at
          SITE VALUATION taxes as a means of stimulating improvements". We believe
          that such a property tax reform could be a most useful, if not an essential
          tool in helping to achieve the Land Use goals contained in the Delaware
          Tomorrow report.

          S omething seems drastically wrong with                                  our present property tax system
          that appears to promote the very ills that the Commission hopes to cure,
          -- the abandoned, boarded-up and decaying city housing, the penalties for
          fixing up or enlarging one's home, the continued exodus of businesses and
          the middle class from the cities, and the expensive wastefulness of
          suburban sprawl. The Commission. report certainly indicates awareness of
          the problem in that many of its recommendations include special tax induce-
          ments to help reverse this harmful trend.

          We firmly believe                t!iat a more effective and permanent form of tax incentive
          would be property.tax reform that reduced taxes on all improvements, while
          increasing taxes derived from the Location values of the land., or site, on
          which the improvement is built. Without this progressive reform,, the
          conditions of our cities and communities in gerreral may be doomed to
          continued deterioration, no matter how much our resolve and public expen-
          ditures in efforts to rehabilitate them.

          Consider, for example,, how reduced taxes on such desired impr-)vements as
          homes, apartments, and job-producing business, com-mercial, and industrial
          structures would provide strong incentive for greater ntrnbers of new, hip"In
          quality buildings. Equally important,, reducing this tax Denalty on improve-
         ,ments would promote the rehabilitation of older, deteriorated structures
          through private, rather than public fundingo and would help save our existing
          housing stock from sliding into disrepair.
          On the other hand, higher taxes on urban land itself would help ensure that
          sitr-s needed by the coirnunity w-)uld likely be put to their highest and best
          use. This @,,,ould greatly aid URBA14 LAND CONSERVkTION, for our community
          land resources are much too limited and imDortant to be wasted and powted
          by misuse for boarded-up and blighted buildings, vacant unused sites, and
                                                                                            Cl'@
          for the proliferation'of ground level parking lots.
<pb n="740" />

Higher taxes on site values, whether achieved through more realistic
assessments of actual market values, or by higher tax rates on land than
on improvements, would also help ensure that growth and development would
occut primarily where supportive services already exist. It is these very
services that make such locations sought after and most valuable. The
site tax would help discourage any speculative witholding of these valuable
and needed sites from the market.

This better utilization of both community and perimeter locations could
then enhance the prospects for preserving the outlying green fringe and
farmland areas by lessening the pressures caused by leap-frog development
and suburban sprawl.

There is a good possibility that the construction costs of much desired
mass transportation systems of the future might be financed in their
entirety by the taxing of the increased land values thus created adjacent
to these facilities. Studies have shown this to be feasible, and there is
a current proposal to fund the San Francisco Bay Area Rapid Transit system
in this manner. Studies have also shown that the increased land values
arising from the construction of bridges, tunnels, and highways in and
around New York city could have paid for the costs of these facilities
many times over.

How to accomplish such tax incentives? We could initiate reform as has
Pittsburgh, Scranton, and Harrisburg, Pa., Arlington County, Va., and , just
recently, the District of Columbia. We could ask that our local government
and the Delaware Legislature do as Indiana's State Legislative Council did
last November when they heard testimony outling a study of suggested ways
by which Indiana cities might introduce such site tax incentives, and
adopted the study unanimously. This Committee would be happy to assist
in such an effort that could help to achieve Delaware's goals for tomorrow.

										Frank E. Nelson
										Co-Chairman
<pb n="741" />

                                                                     JAN 1   1976
          The Delaware Tomorrow Commission
          c/o Office of the Delaware State     Planner
          Thomas Collins 3uilding
          Dover, Delaware

          Gentlemen:'

                Many Of us were unable to comment at the public meeting
          held  for that purpose in Dover last week because we had not
          seen  a copy of the report your cmmission nut together. -Now
          that  I've received a copy in the mail and had the oportunity
          to examine it, I would like to offer the following comments:

          Land  Use and Community Development
                - Implementation of Agriculture and Farm land Policy - the
                concepts of development rights and the changing of state
                inheritance taxes Pre highly desirable goals not only to the
                agricultural interests but to those of us who feel the
                current pattern of residential development in Delaware is
                more often.determined by what farms the realtors can entice
                the owners to subdivide than by the decisions of our
                professional planners.

                  Implementetion of...Open Space Policies - the concept of
                lower assessments for land dedicated to open space could be
                a definite step toward slowing the trend of "sorawl"
                development but has the danger of decre sing local revenues
                without measurable benefit unless a workable definition
                of "open space" could be found that would insure that gravel
                pits, abandoned gas station parking lots, etc., wouldn't
                be considered 'open spaces" for tax purposes.

          Economic Development
                - Delmarve Advisory Council   Aid - this agency should not
                be encouraged to develop) the southern counties for industriAl
                purposes. Such action would be inconsistent with the
                wishes of the majority of the residents of Kent and Sussex
                County who have found that the increased population and
                demands on services caused by new industry in those ereps
                do hot benefit the existing populace.

                  City of Wilmington Findings - you've outlined an excellent
                approach to out our state's major city back on its feet.
                Use of existing facilities there seems to be an efficient
                use of assets which is worthy. of implementation.

                - Land use Planning and Regulation - the concept of a state-
                wide planning commission seems to be only an overlapping
                of local government activity pnd appears to be designed
                primarily as an excuse to remove the Coastal Zone Act.
                While most of up don't know all that much about the environ-
                mental arguments for the Act, we are comfortable with it
                despite the allegations by construction unionists and
                others that it is anti-industry. In essence, there., is
                some doubt as to the need for statewide land use
<pb n="742" />

		it incorporated wholly the only statewide planning found
		acceptable to most Delawareans to date- the Coastal Zone Act.

	Thank you for the opportunity to provide comments on your
report and please be assured that the effort you made in preparing
it is appreciated by all of us who share your interest in Delaware's
future.

									J. Melville
									Smyrne, Delaware 19977
<pb n="743" />

                                                             ftwirx Tounly
  JOSEPH T. CONAWAY                                                caURTHOUSE
  COUNTY ADMINISTRATOR                                       GEORGETOWN, DELAWARE 19947
                                                                    302-856-7702

                                       January 23, 1976

       Mr. 0. Francis Biondi, Chairman
       Delaware Tomorrow Commission
       State Planning Office
       Dover, Delaware   19901

       Dear Mr. Biondi:

            The Sussex County Council, at its January 20, 1976 meeting,
       discussed in great detail the Draft Report of the Delaware Tomorrow
       Commission. After this discussion, Council took'the following stands
       and offers the following recommendations concerning this report:

            (1) When  this Commission was appointed, its tasks were
            clearly outlined; however, in recent weeks the Commission
            has taken a dangerous turn. There is now some feeling that
            the Commission should become a permanent body charged with
            policy making responsibilities. If this becomes a fact, the
            Commission itself will have violated one of its own recommen-
            dations by adding itself to the level of bureaucracy that
            strangles Delaware today. It is the Council's feeling that
            the Commission has served its purpose and should not continue
            as another level of bureaucracy.

            (2) The Commission recommended that a State wide land
            use plan be adopted. Traditionally and historically, land
            use,decisions have been local prerogative. To usurp this
            authority from the municipal and County governments would
            only further aggravate the feelings of the people that they
            have lost control of government. Without commenting on the
            merits of the Coastal Zone Act, it is significant that the
            only attempt by the State to involve itself in land use plan-
            ning has led to the greatest controversy in the State today.
            If the State were to develop a plan for the remainder of
            Delaware, the controversies would never be resolved. The
            Commission has insisted that t-he land use plan will not
            be a "zoning map", but we submit that it is  impossible to
            separate the two. If one "plans" to use an   area for agri-
            culture or industry, then in substance that  area has been
            "zoned"-for agricultural or industrial use. Decisions af-
            fecting the land of Sussex County should be  made in Sussex
                                                                             -7,
            County by elected officials who are elected  to offipf,@hv
            Sussex Countians.                                 R    -e7

                                                                    JAN 2`
<pb n="744" />

         Mr. 0. Francis Biondi              -2-                January 23, 1976

              (3) The Commission addressed the economic problems   'of
              Delaware and has made recommendations to correct these
              The emphasis of this section of the report is the rede*
              velopment of the City of Wilmington. Through further
              recommendations, the Commission has placed itself squarely
              in a position of impeding the development of Sussex County
              (use of abandoned industrial sites, utility construction
              to mention only two). The Commission must takeldefinite
              steps to address the economic problems of Sussex. The
              following recommendations are made:

                   (A)  that the Recreation Industry be treated
                        in the same manner as any industry in
                        Delaware

                   (B)  that.increased financial aid to expand
                        tourism and recreation facilities be
                        included in the State budget; the County
                        should explore the possibility of joint
                        funding such expansion. Fees charged
                        at State Parks to Delawareans should be
                        immediately,discontinued.

                   (C)  that the economic base of Sussex County
                        be expanded through the attraction of a
                        more diversified industrial base to the
                        County; efforts should be made to assure
                        that all perspective industrial clients
                        are shown the entire State.

                   (D), that the people of Delaware must be
                        educated about the economic  problems
                        of Sussex so that a more realistic
                        attitude towards the planned and ulti-
                        mate development of the County can be
                        obtained; it is time that the people
                        of Delaware realize that there is more
                        to Sussex than our beaches.

                   (E)  If Wilmington is to be redeveloped,
                        majc;: consideration should be given
                        to a metropolitan form of government

                           New Castle County.
                         n

              (4) The Commission's recommendation concerning   the cost
              of Public Services is commendable.

                   "That all elected officials at all levels  of
                   government initiate a coordinated, cooperative,
                   comprehensive review and examination of the
                   delivery of services of the various levels of
                   @overnment and public institutions supported
                   in whole or in part by the taxpayer."
<pb n="745" />

      ,Mr. 0. Francis Biondi               -3-              January 23, 1976

            Immediate steps can be taken to carry out this  recommenda-
            tion. If the responsibilities of each government level are
            clearly defined, duplication of processes can be eliminated.
            If the temptation by all levels of government to extend ser-
            vices into areas already the responsibility of another level
            of government is controlled through the political process, the
            State of Delaware, the County governments, and the municipal
            governments will not face the burden of extensive salary pro-
            visions and pension requirements in operating budgets. More-
            over, by clearly defining the role of each level of government,
            capital improvements in these areas can be limited strictly to
            the responsibility,of the government in question.

            The Council commends the Governor for the creation of the Delaware
       Tomorrow Commission and congratulates the members of the Commission who
       worked long and,hard to draft this report. Although we don't agree with
       some of its recommendations, there is much in the report with which we
       can agree.

            If we can be of any further assistance, don't hesitate to call
       upon us.,

                                           Yours truly,

                                                        away
                                           County Administrator

       JTC/sww

       cc:  The Honorable Sherman W. Tribbitt
            The Honorable Thurman Adams, Jr.
            The Honorable Richard S. Cordrey
            The Honorable David H. Elliott
            The Honorable Lewis B. Harrington
            The Honorable Harry E. Derrickson
            The Honorable Howard A. Clendaniel
            The Honorable Thomas A. Temple, Sr.
            The-Honorable William J. Gordy
            The Honorable Donald J. Lynch
<pb n="746" />

                                                                                               January 26, 1976

The Delaware Tomorrow Commission
c/o Delaware State Planning Office
Thomas Collins Building
Dover, Delaware  19901

	Watch our Waterways is concerned
	that you will recommend to the
	General Assembly repeal, or replacement
	of Delaware's landmark Coastal Zone Act,
	by other land use legislation W.O.W.
	recommends that Delaware's Coastal
	Zone Act, Wetlands Act and Beach
	Erosion Act be placed in their
	entirely into any new land use
	legislation proposed. We feel
	this will help passage of
											RECEIVED

												JAN 27 1976
<pb n="747" />
<pb n="748" />

          Benjamin J. Campagna B. J. CAMPAGNA ASSOCIATES, INC.
          Roger L. Williams
          Robert L. Smith         Consulting Engineers*Planners9Surveyors
          Associates
          Ramesh C. Batta    1812 Newport Gap Pike              Front &amp; Pine Streets
          Alan L. Chase     Wilmington, Delaware 19808        Georgetown, Delaware 19947
          Rushi J. Kapadia      302-995-6101                      302-856-7745

                                           January'30, 1976

                                                                    I E'

             0. Francis Biondi, Esquire, Chairman
             Delaware Tomorrow,Commissibn
             1300 King Street
             Wilmington, Delaware 19901

             Dear Frank:

                  When I first read the Draft Report of the Delaware
             Tomorrow Commission, I became discouraged, and set the material
             aside, with a "what's-the-usell attitude.- However, .1 have
             lately reconsidered and offer the following comments thereon,
             for what they may be worth:

                  1. In general, the document is extremely confused and
             confusing, conditions Arising,,no doubt, from hazy thinking,
             bad-poor-sloppy writing, disorganized structure and lack of
             competent editing -- all perhaps (but not necessarily)
             inevitable in a product of this sort, representing the
             collaboration of many people;
                  2. Throughout the Report, there is an app Arent confusion
             between "goals" and "policies," and, also, a mixing of "policies"
             with 11findings;"

                  3. There are serious.internal inconsistencies as to both
             content and style. On the one hand, on   page 14, it is stated
             "The Commission feels the establishment  of an arbitrary
             employment or population rate of growth  policy, either by
             opecific number or 'percentage, will not be effective and it
             may, indeed, be counter-productive;" on  the other hand.- on
             pages 49 and 52, reference is made to a  1985 State population
             ofltpproximately 700,000." If the latter is not a "specific
             number" and does not establish a population "rate of growth,"
             what does?

                  Specific comments follow:
                  4. On page i, why wasthe Commission's task to examine
             "goals," as well as "policy'?" I contend it'is either impossible

                                                                   R E     F7 I V E:

                                                                              t976

                                                                   STAT Ff.T.AN"WING OFFICE
                  Registered
                  Professional   Delaware, Maryland, New Jersey, Pennsylvania
                  Engineers
<pb n="749" />

           0. Francis Biondi, Esquire, Chairman
           Page 2
           January 30, 1976

           or highly undesirable to have "policies" without "goals," since
           in order to get where you want to go (policies), you first
           must know where you are going (goals).

               5. Same page. In two successive sentences, word "alternative"
           used incorrectly and correctly, respectively (first instance
           should be "alternate" (adj.)).' What is "effective" growth?

               6. Use of term "areas" is jargonistic. Better to say
           "Recommend to State Government policies and strategies for
           effective and rational residential, commercial and industrial
           growth."

               7. Page 9.. Difficult to understand how a "model" (ideal
           example) can belattained" by "discussing...issues,"' but, in
           any event, what was the "model" thus "attained" and why aren't
           we told what it looks like? (Presumably, from later discussion
           in the Report.. it is some sort of poly-nucleated form).

               8.. Same page. Here it seems to be saying that.a "program"
           (how does a "program" differ from a "policy" or a "recommendation?")
           is an implementation "tool."

               9. Page 10. Here it says "The Committee did not attempt
           to say what growth aught to be, but, rather, to clearly state
           the basic issues.,, Outside of the split infinitive, and 3,
           above,, the major point is that such position to me represents
           a complete "cop-out." What is the Committee for, if not to
           say what growth ought to be? How can the Committeeltletermine
           (alternate) ways that State Government can provide for effective
           growth" or "Evaluate the potential impact of various growth
           alternatives in the private and public sectors" or "Recommend
           to State Government policies and strategies for effective and
           rational growth... 11 (page 1), if the approximate dimensions of
           such growth are not estimated? I.contend it is impossible.

              10.. Same page. What is "accurate" growth? "With the existing
           businesses..." should be "within the existing businesses...

              11. Page 11. Confusion of grammatical number in sentence
           beginning "what is the relative... 11 as between."quality" and
           "they."

              12. Same.    Sentence beginning "An attempt... " should read
           "An attempt was then made to extrapolate these past trends
           in revenues and expenditures to 1985, under several possible
<pb n="750" />

             0. Francis Biondi, Esquire, Chairman
             Page 3
             January 30, 1976

             assumptions."

                  13. Page 13. Split infinitive in sentence    beginning
             "Consequently..."

                  14. Same. End of third paragraph."Response     to what?

                  15. Same. I contend that economic and population growth
             questions cannot be separated, but are obverse faces of the
             same coin. Therefore, public policy regarding growth should
             not consider these as "separable issues requiring differing
             approaches." To.do so is' to mislead the public into believing
             it.:can have its.cake and eat'it, too, i.e., it is possible to
            ,have economic growth with little or no population increase.
                  16. Page 14. 'First sentence, What does "this" refer
             to?  Influence economic development in what direction, towards
             what goals?. (See 2, above).

                  17. Same. Here it is stated "...the Commission feels
             that the public sector will do well to establish policies
             that can accommodate the population growth which will respond
             to the economic conditions." First of all, "respond" should
             be "reflect." Secondly, this statement is an apparent con-
             tradiction of an earlier statement (see 15i above). Thirdly,
             to advocate that population growth (whatever it is to be) be
             "accommodated" is another "cop-out" and a "throw-back" to the
             New Castle County General Comprehensive Develupment Plan, of
             1966, at which time such an approach was still barel acceptable,
             in terms of planning "know-how." Since then, of course, we
             have "discovered" ecology and presumably know more than we did
             in 1966, although sometimes one wonders.

                  18. Same. How can one have "a set    of policies which will
             allow the jurisdictions throughout Delaware to respond better
             to changing conditions," when it is the very "set of policies"
             which is supposed to determine what such conditions will be,
             not enable jurisdictions to respond to some.unknown situation.
             Presumably, if public policy is reasonably to assure that
             certain conditions will obtain, then the jurisdictions will be
             in a position to respond. Otherwise, what we have here is nothing
             but a "finesse" or a variation on the old.shell game; in other
             words, misleading the public into thinking you are saying
             something, while in reality, you are not--a favorite dodge of
             some planners, by the way.
<pb n="751" />

           0. Francis Biondi, Esquire, Chairman
           ,Page 4
           January 30, 1976

                 19. Page 17 et. seci. Here the Report structure is
           apparently intended to be set up as follows:
              "FINDINGS, POLICIES AND IMPLEMENTATION RECOMMENDATIONS" (najor heading
           "COMMUNITY DEVELOPMENT PATTERNS" (sub-major heading)
           CommunitV Patterns Findings (minor heading)

                 1.
                 2.
                 Etc.
           Community  PatternsPolicies (Minor heading)

                 2.
                 Etc.
           CommunitV  Patterns Policies (Minor heading)

                 2.
                 Etc.

                 However, the above structural organ    ization is not con-
           sistently followed-throughout.

                 20. Page 17. What is "existing industrial land?" Land
           zoned industrially? Land containing existing industrial buildings?
           If the former,.no guarantee that such land is centrally located.
           If latter, may well contain obsolete or obsolescent buildings,
           etc. Why will this policy reduced travel to "outlying" areas,
           if industrially-zoned land is referred to?

                 21. Page 18. Major heading ("TRANSPORTATION") missing.
           (see 19, above).

                 22. Same. What is an "increased... system?" (should be
           "expanded").

                 23. Same. "Finding 2" is really a "policy." What does
           the second sentence in this paragraph have to do with the first?

                 24. Page 19. "Finding 3" -- see 23, above.

                 25.  Same. Major heading ("UTILITIES") missing.

                 26.  Same. "Finding 3," What is an "interceptor line
           sizedwith  over extension?" Current practice of designing sewer

           *Could be termed first-   order, second-order and    third-order headings.
<pb n="752" />

             0. Francis Biondi, Esquire, Chairman
             Page 6
             January 30, 1976

                  41. Page!28. "Finding 2," Here we suddenly revert       to
             "goalsol (see    above) .

                  42. Pad,@- 29. Presumably more "implementations" are    needed
             here, vis-a-*'.-@,;number of "Policies" enumerated.,

                  43. Page;30 et. seg. This     section of the.Report is  merely
             "stuck on" to-the previous material, seems to'have been written
             by someone else and not appropriately rewritten, and doesn't
             follow the structure, organization (such as it was) or
             typographical style  of the previous section.

                  44. Page@32.    Second sentence. Here we have    the edifying
             example of a 1@costll being 11qxpensive" (1).

                  45. Pa  ge 33.  ""Perspective" should be "prospective."

                  46. Page's 33  a@n4 34. Here is certainly an explicit
             forecast of an,,-@economic growth rate, despite the previous
             disclaimer.

                  47. Page   34.  @@'Again mention of "goals," this time for
             population and  employ  nt growth. How can "the State obtain
             general agreement on 11@@ uch) goals" if the Delaware Tomorrow
             Commission sidepteps,   ese matters? The next sentence states
             "The Delaware@,omorrow  Commission should establish population
             and employment@growth goals...," yet the first portion of the
             Report deliberately avoids doing so(l)

                  48. Pag  e 35. How do youllimprove an edge?"

                  49. Page 36. Major Heading ("EDUCATION") missing.

                  50. Page 37. Last    sent-cnce poorly written.

                  51. Page 40. Where    arelthe "findings" and "policies?"

                  52. Page 41. Wording     "solvent-carrier" makes it appear
             that chemicals are being transported.

                  53. Same-   'Tqhat is reference of "Both" in sentence
             beginning with  that word? Acquisition of what?

                  54. Page   42. Last sentence incomplete.

                  55. Page!,45. See 43, above.

                  56. Same. Question mark missing at end of 3,rd paragraph.
<pb n="753" />

           0.  Francis  Biondi, Esquire, Chairman
           Page 5
           January 30, 1976

           interceptor lines reflects the vast confusion of         our current
           planning, i.e., lines are sized to accommodate future flows
           generated by "planned" land use allocations. IfJines are
           over-sized, it is the fault of our planning. Since sewer.lines
           have life of 50 years, they should       be sized to accommodate
           more than near-term growth.

                 27.   Same. "Finding 4.51 See      26, above.
                 @8.   Page 20. Inconsistent     organization. (See 19,      'above).

                 29.   Same.   Recommendation   B2. See 26, above.

                 30.   Page 21. Recommendation B3. As far as         I known,   sewers
           are  built  with collector   systems leading into trunk      and
           interceptor lines.

                 31.   Page 22. What    is  reference of   112his" in pen-ultim,ate
           sentence?

                 32.   Page 23. "Findings 1-3." See        23, above.

                 33..  Page 24. "Policy 3.11 Presumably       "PREVENTION OF"    should
           be inserted between "FOR" and "BEACH."

                 34.   Same. "Policies    4 and 5" seem to    belong under "UTILITIES,"
           as does "Implementation 411     (should be "Recommendation ?")
                           '11                                                                  1
                 35. @Page 25. "Finding 4" Question if this is a "finding"
           or merely a hope.,

                 36. Sa e.     "Policy 211 should read    11DELAWARE,TOGETHER WITH MF
                         m                                                            _@E
           FEDERAL GOVERNMENT, MUST... 11

                 37. Page 26. "Policy 1.11 Does        "curtailment" apply to,
           existing Commercial development, and,       if so, how?

                 38. Page    27. Implementation 3. Insert "development"
           between "for" and           Level of highway service is indicated
           by the V/C Ratio.
                       Same.   "Finding 1.11 Second sentence is a "policy..".,

                 40. Same.     Institutional Policy. Nhat happens if no
           indication given    as to locatioi-, oi,_ plans?
<pb n="754" />

         0. Francis Biondi, Esquire, Chairman
         Page 7
         January 30, 1976

              57. Page 46. Second paragraph    of "Recommendation,"
         last sentence--bad writing.

              58. Same. Last paragraph. If     State intends to "take
         back" or "over-ride" local zoning powers. this will "contravene".
         existing authorities of counties and local.governments.

              59. Page 47. It would seem that more than an "analysis"
         would be needed.

              60.  Page 48. See 43, above.

              61.  Same. First sentence is poo  rly written.

              62.  Page 49. Basis of assumption re population?

              63.  Page 51. Phrase "In other words" misplaced. Word
         "But" in sentence beginning with same, extraneous.

              64. Page 52. Last sentence, first paragraph. What
         growth projected by Commission?

              65. Same. See 61, above.

              The abovelist is far from   exhaustive, as I have probably
         taxed the patience of my typist  already. I have a good deal
         of respect for your abilities and those of certain others on
         the Commission and Technical Advisory Committee. Therefore,
         I find it difficult to understand how something of this (lack
         of) quality came to be written and distributed in the name
         of the Commission. Since it is a draft report, no doubt the
         ,mechanical errors of writing and organization can be corrected
                                                        h@w
         for the final version. I do not, however, see,the ol@vious
         inconsistencies of thinking can be 'rectified, short of beginning
         all over again.

                                        Sincerely,

                                        Alan Chase

         ALC/sw
<pb n="755" />

                                                                                             , ilf

                                                                  U

                                            3 6668 00002 9324
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