Senate Bill 1036 needs some fixing and it possibly could be meaningless in local area

Fees on new development would provide some help to K-12 public schools dealing with rapid population growth or aging school buildings, but they are far from a complete solution.

Oregon legislators and ardent supporters of K-12 public education must be careful that they don't portray Senate Bill 1036, which was scheduled to have its first public hearing Wednesday in the House Revenue Committee, as a panacea for what ails schools.

For years, school supporters have pushed the Oregon Legislature to allow school districts to collect fees on new homes - much the same way as cities, counties and special service districts collect system development charges on new development to help pay for new roads, water and sewer system infrastructure and new parks.

But for just as long, homebuilder associations in Oregon have opposed the idea. Now, homebuilders are saying they will agree to a reduced fee on new homes as long as new commercial and industrial development is charged a school impact fee as well.

Legislation presents dangers

That compromise is SB1036, which would give Oregon school districts the discretion to impose fees of $1 for every square foot of new housing; 50 cents for every square foot of new commercial space and 25 cents on every square foot of new industrial development.

All told, supporters say the legislation could generate as much as $60 million annually throughout the state. In Portland Public Schools, a district burdened by many aging and decaying schools, the legislation could generate more than $4 million a year.

That also is the total estimated to come the way of the North Clackamas School District, the region's ground zero of rapid population and enrollment growth. In Beaverton, Hillsboro, Tigard-Tualatin and Gresham-Barlow, the districts could receive anywhere from $700,000 to $2 million annually.

The situation is different, however, in the Lake Oswego School District's case where the school board has yet to discuss 1036's implications and therefore hasn't taken a position on it, said Superintendent Bill Korach. With declining enrollment, however, the district is not looking at adding any schools in the near future.

Such assistance for schools can neither be dismissed as inconsequential nor overemphasized as a fix for what ails educational finance. It is neither. But it is a small help in paying for new elementary schools that cost $13 million to $20 million, a new high school that could cost as much as $60 million or land for a school that could cost as much as $9.5 million.

There are significant dangers associated with this legislation. One is a matter of misperception. If Senate Bill 1036 is adopted into law, voters may think that the problem of capital funding for schools has been solved and that school districts no longer would need local property tax bond measures for new and repaired schools. Nothing could be further from the truth.

Another pitfall associated with the bill is that it would prohibit cities and counties for 10 years from enacting their own local excise tax. Such a pre-emption is unwise policy because it restricts local governments from developing their own relevant, local funding solutions for essential tasks such as planning and paying for growth, transportation projects or sewer and water systems.

Amend bill and pass it

Over the next few weeks, we suggest that the Oregon House improve SB1036 by dropping the pre-emption for local cities and counties. But we support the bill and encourage the House Revenue Committee to make some fine-tuned adjustments in the legislation. And we urge legislators, school supporters and homebuilder lobbyists to not imagine this proposal as the final solution.

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