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School board to discuss building tax

The Ashland School Board on Monday will discuss enacting a tax on all new-construction building permits taken out within the district.

School administrators want to take advantage of a 2007 Oregon law that allows districts to tax new construction in order to help pay for building and maintenance of school facilities.

The board voted 3-0 in August to direct school officials to move forward with the tax proposal.

"When someone builds a home in the district there is a cost to the district to add additional facilities if there are children," board Chairman Keith Massie said Wednesday. "This helps compensate the district for the additional costs that the school has."

Jill Turner, the district's business manager, estimated the tax could bring in between $80,000 and $300,000 per year.

Because of the economic climate and building slowdown, district officials "expect the lower amount initially," she said.

Monday's 7 p.m. meeting at the City Council Chambers comes on the heels of the passage of Ashland's meals tax renewal.

Unlike the meals tax, the construction excise tax does not have to go before voters and could be approved by the board as soon as Dec. 14, Turner said.

On Monday, the board will hold a public hearing on the tax. It will be an opportunity for locals to weigh in on the matter and for the board to ask district administrators questions.

"It'd be great to hear from the public what they think of this," Massie said.

At their August meeting, board members asked what the potential negative impacts of the tax could be.

"The only negative I could foresee is that you could pretty much assume that a contractor would pass these costs on to the consumer," Superintendent Juli Di Chiro said.

School administrators are proposing that the district enact the highest tax possible under the 2007 law, Turner said. The proposed tax would be $1 per square foot on residential construction and 50 cents per square foot on non-residential construction, according to board documents.

The fees would not exceed $25,000 per building permit or $25,000 per structure, according to the documents.

The district could only use the tax revenues to pay for new construction or renovation projects, Turner said. It is a one-time tax, levied when the building permit is issued. Remodeling projects would not be taxed.

Central Point's school district is the only one so far in Jackson County to implement the tax, she said.

Some building permits, such as those taken out to construct low-income housing, would be exempt from the tax, she added.

Implementing the tax would require intergovernmental agreements between the district, the city and the county. The city and county would collect the fees and hand them over to the district, taking a small percentage for processing costs, Turner said.

If the board approves the tax at its Dec. 14 meeting, the tax would be implemented Feb. 1, after the intergovernmental agreements have been signed, she said.

Apart from bonds, the district has funded all maintenance and construction projects from its own coffers, Turner said.

"Traditionally the district has not had that much money and we've spent it all on education and not on repairing and replacing roofs and those sorts of things," she said.

In 2006, voters approved a $46.8 million bond to help pay for the renovation of Bellview Elementary School and the Ashland High School gym, among other projects. The district has $2.3 million of that bond money left, but also has a long list of maintenance tasks, Turner said.

"Our list is much is longer than the amount of money we have," she said.

Although the tax wouldn't likely bring in much revenue this year, the amount could increase if the economy improves, Massie said.

"The amount of money we will receive from this, especially in this kind of economy, won't be significant, but over time if construction does pick up again, then the school district will receive additional funds and that would go toward adding additional facilities," he said.

Contact staff writer Hannah Guzik at 482-3456 ext. 226 or hguzik@dailytidings.com.