Board hears plan to raise construction‑excise tax; staff to return with rate recommendation in August

Newberg School District staff briefed the board on the district’s construction excise tax (CET) authority and signaled a recommendation to increase the rate to follow the Department of Revenue index instead of leaving the rate at the original $1.00 per square foot.

A staff presenter said the district has charged the original $1.00 rate since the CET was established and that many districts now levy an indexed rate. The presenter described contacts with neighboring jurisdictions to verify their rates and said a future board meeting—likely in August—will include a formal recommendation to adopt the indexed rate (examples discussed included an indexed equivalent near $1.67 per square foot, depending on county determinations).

Board members asked whether CET rates vary within district boundaries that cross multiple cities and counties; staff said implementation is handled by city and county permitting offices (Dundee, City of Newberg and three counties were listed) and that the fee is collected at time of permit/submission with system‑development charges. Staff projected the district’s CET fund balance at roughly $2.3 million for next year and said staff will follow up with the city planning department about expected development that could generate CET revenue.

Staff reminded the board that CET revenue is restricted to capital uses tied to development impacts—classroom furniture, long‑term capital improvements and similar uses—and is not general fund revenue. The board asked staff to return in August with a rate recommendation and, separately, a proposal describing priority categories for CET spending.