House Passes Package of Bills to Address Issues in Statewide Property Reassessment Process

DOVER – This week the House passed 6 bills aimed at standardizing the statewide property reassessment process. 

Between 2021 and 2025, all three counties in Delaware conducted property reassessments. It was New Castle County’s first since 1987, Kent’s since 1987, and Sussex’s since 1974. This was the result of a 2020 ruling, which found that Delaware’s property tax system was unconstitutional.

In July 2025, New Castle County residents received their first tax bills since the reassessment. Due to the decades-long gap between the last reassessment and the lawsuit-mandated one, as well as errors in the reassessment process itself, the average New Castle County resident saw their assessed home values rise by 433% – leading to their bills increasing by hundreds of thousands of dollars in some cases. 

In response, lawmakers convened a special session in August 2025 to pass 7 pieces of legislation aimed at addressing the immediate concerns that arose from the statewide reassessment. Later that month, House and Senate Democratic leadership formed a bipartisan Special Committee to investigate the reassessment process and consider additional legislative action to improve the process and offer targeted tax relief.

Lawmakers passed two more pieces of legislation addressing property tax reassessment when they reconvened for the second half of the 153rd General Assembly, including SB 228, enacted without signature on February 11. This measure granted authority to the Office of Finance for New Castle County to conduct a quality control review of non-residential tax parcels to ensure they were accurately assessed, and correct valuation errors if they were not. Revisions and corrections must be made by October 16, 2026. Because of the potential for change in property values, SB 228 also extended school boards’ deadline for submitting their tax warrants from July 9, 2026 to October 22, 2026. 

HB 461, sponsored by Rep. Cyndie Romer and Sen. Dan Cruce, was passed by the House on Tuesday. It builds off of SB 228 by giving special authority to school districts in New Castle County to reset their tax rate for the 2026-2027 tax year to account for the adjustments to the New Castle County tax roll that are continuing to be made. These adjustments include the appeal results, quality control reviews, and potential changes from other legislation. However, the tax rate cannot increase the projected operating revenue of a school district, with few exceptions. 

HB 462, sponsored by Rep. Kim Williams and Sen. Jack Walsh, was passed by the House on Thursday. It is a follow-up to HB 242, which gave any school district located in New Castle County the ability to reset its tax rates for the 2025-2026 tax year, and reissue a tax warrant using different tax rates for residential and non-residential property.

Under HB 242, which was signed in August, the non-residential tax rate had to be at least equal to the residential tax rate, and could not be more than two times the residential tax rate. HB 462 continues the authority for non-vocational school districts in New Castle County to set different tax rates for residential and non-residential properties. However, under HB 462, non-residential tax rates must be at least equal to the residential tax rates, and can not be more than 1.85 times the residential tax rate.

The New Castle County Vocational Technical District is not included in HB 462, and may not continue the use of different tax rates past the 2025-2026 tax year.

“House Bill 462 continues our efforts to be responsive to the public who, after more than 40 years of stagnant assessment values, were outraged by the sticker shock they felt when they received their tax bills last summer,” said Sen. Jack Walsh. 

“This legislation is just one piece of the puzzle to ensure that our property reassessment process is fair to the people we serve.”

Last June, the House passed HB 159, which authorized the county to adopt an ordinance adjusting School Tax Elderly Exemption amounts established on or before January 1, 1998, during county-wide reassessment. This raised the property value exemption limit from $32,000 to $173,000 to align with the current reassessment values, meaning that a New Castle County resident aged 65 or older with a property value of $173,000 or lower would be eligible for an elderly exemption from school taxes, as long as they met the other criteria. 

The other criteria, however, includes a $15,000 income limit for a single property owner, and a $19,000 combined income limit for married property owners. For added context, the 2026 federal poverty level is $15,960 for individuals, and $21,640 for a family of two.

While New Castle County recently raised both the property value exemption limit and the income limits to be eligible for the County Property Tax Elderly Exemption, from $32,000 to $173,000 for property values, and $50,000 for individuals and $65,000 for couples with a combined income, they did not do so for the School Tax Elderly Exemption. 

HB 463, another measure from Rep. Kim Williams and Sen. Jack Walsh, would address that discrepancy by requiring New Castle County to use the same eligibility criteria and calculation formula for exemption from school taxes that it used for county taxes in the fiscal year that began July 1, 2025. This would bring income eligibility limits for the School Tax Elderly Exemption in line with those of the County Property Tax Elderly Exemption, allowing for more lower to middle income seniors to receive relief. 

HB 463 was also passed by the House on Thursday.

“Last year, we saw the impact that the split tax rate can have on residents’ properties through HB 242. HB 462 will build on that effort by permanently allowing the school districts to use different tax rates for residential and non-residential properties. By providing the capability to have a higher rate, this will help to offset the tax burden for residents. At the same time, this bill provides a crucial guardrail by having a cap on the multiplier for businesses as the rate would be no more than 1.85x the residential rate. In last year’s legislation, this rate was no more than 2x the  residential rate,” said Rep. Kim Williams. 

“This effort combined with raising the exemption income from $15,000 single and $19,000 married to $65,000 which would not include social security, would match New Castle County existing income eligibility requirements for Elderly Exemption from School Property Tax. This would make sure that individuals assessed home value would be reduced by $173,000 if they qualified. After working with my colleagues on the House Reassessment committee, school districts throughout New Castle County, and several stakeholders, this legislation represents a good path forward for our communities.”

HB 460, sponsored by Rep. Cyndie Romer and Sen. Dan Cruce, works to prepare New Castle County for the next reassessment by expanding permit data sharing requirements. Under current law, building inspectors in New Castle County who issue permits for new buildings, repairs, or additions must report every permit issued to the Office of Finance. 

Under HB 460, municipalities must submit detailed permit data, including the status of a certificate of occupancy, and estimated cost of proposed new buildings or proposed repairs or alterations, on a monthly basis. If a municipality fails to submit their monthly permit data, they would be required to submit a report to the Office of Finance, the House of Representatives, the Senate, and the Division of Legislative services detailing why they did not send in their data that month, how they plan to address the issue, and when they will send their data in. 

“Part of building a strong reassessment system requires data you can rely on. We heard that the lack of permitting data available led to major inaccuracies in tax assessments, and HB 460 ensures that will not happen in the future,” said Rep. Cyndie Romer.

The increased accountability is to ensure the consistent and timely submission of information, as permit data is necessary for completing accurate property assessments.

HCR 150, sponsored by Rep. Cyndie Romer and Sen. Dan Cruce, would establish a statewide Property Assessment Working Group.

During the second hearing of the Joint Special Property Reassessment Committee, members heard a presentation from the International Association of Assessing Officers (IAAO), the internationally recognized authority on mass appraisal practice who publish widely-used consensus standards, including the Standard on Mass Appraisal of Real Property (2013), the Standard on Ratio Studies (2013), and the Standard on Property Tax Policy (2020). Those publications, along with the Uniform Standards of Professional Appraisal Practice (USPAP) Standards 5 and 6, represent the prevailing professional benchmarks for assessment accuracy, uniformity, transparency, and administrative practice in mass appraisal. 

The statewide Property Assessment Working Group would be charged with examining the 

statutory and regulatory frameworks of states that have adopted IAAO standards to develop recommendations, in the form of draft legislation, establishing Delaware’s own quality benchmarks and operational requirements, consistent with IAAO and USPAP standards.

“The legislation passed by the House this week continues the collaborative efforts of the Special Property Reassessment Committee to ensure that our property reassessments going forward are fair, equitable, and predictable,” said Sen. Dan Cruce. 

“So much of this work is driven by the needs of our ALICE population: our Asset-Limited, Income-Constrained and Employed neighbors. That’s why we’re empowering our partners in county government to ensure they have the tools to reassess properties fairly, and we’re committing ourselves to balancing affordability with adequately funding the services that sustain our communities. I look forward to championing these measures in the Senate.”

In order to ensure that no stone is left unturned, HCR 151 w/ HA 1, sponsored by Rep. Eric Morrison and Sen. Kyra Hoffner, would create a Property Tax Relief and Modernization Working Group, which would be tasked with examining relief measures and long-term reforms to Delaware’s property tax laws. 

“We need to find the balance between supporting our school districts and municipalities with appropriate revenue while easing the property tax burden on Delawareans,” said Rep. Eric Morrison.

“Our peer states are leading the way in finding this balance. My hope is that the Property Tax Relief and Modernization Working Group can find these best practices, and recommend how they can best be used in Delaware.” 

The Property Tax Relief and Modernization Working Group would be required to study and evaluate a range of policy approaches used in other states, including many of the approaches reviewed by the bipartisan special committee last year, such as homestead exemptions, circuit breaker programs, property tax stabilization measures, differentiated taxation approaches, assessment caps, and other taxpayer protection mechanisms. The group would also look at the potential impact of these policies on the financial security of school districts and local governments. 

House Amendment 1 adds an additional area for consideration by the working group. Under HA 1, the working group would be charged with evaluating whether Delaware should establish a long-term framework to transition toward uniform property tax rates across property classes, including phased implementation schedules, taxpayer protections, revenue neutrality considerations, and coordination with homestead exemptions, circuit breaker programs, assessment limitations, and other relief mechanisms. 

“Now that property reassessments will be conducted on a more regular basis, it is imperative that taxpayers can trust the process and feel a sense of predictability,” said Sen. Kyra Hoffner.

“We have a lot to learn from other states and municipalities when it comes to injecting fairness into our system of taxation. Instead of reinventing the wheel, let’s identify best practices from other places whose reassessment processes are running efficiently and fairly.”

None of the recommendations or legislation produced in either working group would transfer any assessment authority from the counties to the state. Additionally, each county would maintain independent authority over their respective assessment departments and reassessment schedules.

Both the Property Assessment Working Group and the Property Tax Relief and Modernization Working Group would convene within 60 days of the adoption of their respective resolutions, and both would be required to produce legislation ready for introduction in the 154th General Assembly, by June 30, 2027.

All 6 pieces of legislation now head to the Senate for consideration. 

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