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Scappoose school officials explore the possibility of implementing construction tax

The levy would generate revenue for school district capital projects if approved by school board

SPOTLIGHT PHOTO: NICOLE THILL - Phil Lager, Scappoose School Board member, and Mitch Neilson, Scappoose School District Business Manager, discuss the possiblity of implementing a one-time tax on new construction projects in Scappoose. The school board will likely vote on adopting a resolution at the next board meeting in February.During a Scappoose School Board work session Monday, Jan. 25, board members and school district staff began discussing how to generate revenue for capital improvements through the possible implementation of a construction tax.

Scappoose School District Business Manager Mitch Neilson discussed with board members the possibility of leveraging a state tax approved in a 2007 Senate bill.

The legislation allows school districts to impose a tax on new construction based on the building square footage.

Some new construction, such as public buildings, hospitals and private schools, are exempt from the tax.

Nonresidential and residential builders could pay between a 61 cents and $1.23 fee per square foot of new construction, respectively.

The city collects the tax and then distributes it quarterly to the school district. Funds collected can be used for capital improvement projects or for repayment of debt incurred by starting capital improvement projects.

The St. Helens School District has had the tax levy in place since June 2008. Since 2013, the district has generated $345,000. Those funds are then used for projects identified by the school district’s facilities committee, Jessica Pickett, the St. Helens School District’s business manager, explained. Projects have included bathroom remodels, painting and improvements in special education classrooms.

School districts that have implemented the tax include St. Helens, Portland, Hillsboro and Beaverton. While Rainier and Vernonia school districts do not have the tax, Neilson said the Scappoose School District has made itself an “island” of sorts by not implementing the tax.

Enrollment in the Scappoose School District was more than 5 percent higher at the start of the school year than it was in 2014. In December, enrollment was 4.3 percent higher than it was in December 2014, which equates to 88 more students in the district.

“Right now, we’re out of space,” Neilson told the school board Monday.

Neilson spoke with the school board about the tax to present one option that could help generate revenue for the district to address issues such as lack of space and building upkeep.

It’s unclear why the Scappoose School District did not enact the tax after the senate bill was passed in 2007, Neilson said, because he didn’t work for the district at the time. He said it’s possible current board members did not want to pass a tax levy at the same time as a school bond, but there is no way to know for sure.

Population estimates from Portland State University indicate the county’s population has grown by 0.6 percent in 2015. Neilson said Scappoose’s potential to grow significantly impacts the school district. When new families come to the area and build homes, or manufacturers come to the area, it adds to the school’s needs and puts a strain on its capacity, he said. Revenue generated by the tax relieves pressure on the district’s general funds.

“The end result is how we get more resources to kids to be successful,” Neilson said.

A resolution for the tax will likely be presented and discussed at the school board business meeting on Feb. 8.

Board member Phil Lager said he wouldn’t want it to seem like the board was sneaking in a new tax and would want the public to be aware of it before the board made a decision.