A value capture property tax for financing beach nourishment projects: An application to Delaware's ocean beaches

We propose and apply a value capture property tax for financing beach nourishment projects. Our application is to beaches in the state of Delaware. Using a hedonic price function we estimate the implicit value of proximity to the beach. Using these results we then infer a property tax schedule that taxes homeowners roughly in proportion to the benefits they receive from the projects. We argue that the tax is equitable in the sense that tax burden and project benefits are aligned. We argue that it is efficient in the sense that homeowners face the real cost of maintaining beaches that protect and improve their property