District raises excise tax on local construction

Move will not raise taxes for existing homeowners while helping Siuslaw School District’s aging facilities

Dec. 21, 2019 — “We were told, in no uncertain terms, that the $119 million school bond package is a ‘no,’” Siuslaw School District Board President Guy Rosinbaum said. “That doesn’t change the fact that the school board has to support a 55-year-old school. We have to do that knowing the community will be growing quite a bit in the next couple of years.”

With 233 homes already estimated to be built in the Florence area within five years, coupled with the possibility of construction of hundreds more, the Siuslaw School District is finding itself in a difficult position. With facilities in poor shape and the delicate balancing act of hiring teachers, the region’s march toward housing sustainability could put a considerable strain on district resources.

Yet the district’s school bond, which was put to the voters in 2016 and 2018, was strongly rejected.

“I think we were asking for a lot,” Rosinbaum admitted. “I will be the first to tell you that I wasn’t aboard the $90 million school with the extras on top of it. I thought it was way too expensive for what we were trying to do.”

Currently, the district is not proposing another school bond, though the board of directors have created a facilities committee to examine what is needed to sustain the district’s buildings. This could eventually lead to another bond proposal down the road.

“I’m hoping that the community will support a new high school,” Rosinbaum said. “We need one, and I think that there’s a reasonable number out there that the community would support.”

But with an increase in new housing, it stands to reason that the population will increase as well, putting a stress on district facilities in a number of ways.

To help ease that stress, the Siuslaw School Board raised its construction excise tax from $1 per square foot to $1.35 during last week’s school board meeting. The tax is only on new construction and will not filter down to existing homeowners. It is expected to bring in an additional $40-45,000 annually for the district and will go into effect Jan. 1, 2020.

The funds will only be used for facilities maintenance, and the district will be evaluating the tax yearly.

The move is not expected to put a damper on the region’s growth.

According to City of Florence Planning Director Wendy Farley-Campbell, “Will it keep someone from pulling a permit if they wanted to? Probably not,” she said.

To avoid higher costs, developers could just build smaller homes.

“And that’s what a lot of people need,” she added. “I have a lot of older friends that would love to move into a place that is less than 1,000 square feet.”

Rosinbaum said that the tax is not intended to hurt the growth of the city at all.

“We want to see Florence grow and become everything it could possibly be, and our job is to help educate the children so they can help it be everything it could possibly be,” he said. “But the fact of the matter is, a lot more kids means a lot more infrastructure is going to be put under a lot more stress. And our infrastructure is very old, and it’s going to require funds to deal with that. The only option that the school board has any control over is raising that tax.”

When looking at issues with the school facilities, Rosinbaum pointed to issues with how the school is heated — a boiler from the 1950s.

“You go into the school, you go upstairs, and the kids are all sweating,” he said. “You go downstairs, they’re freezing to death. It’s not conducive to learning, and it requires money to maintain the systems that are there.”

School District Superintendent Andy Grzeskowiak went into more detail.

“When you look at the lifespan of mechanical systems, we’ve got systems that simply need to be replaced,” he said. “They were obsolete technology, but of good quality, when they were put in 50 years ago. Now they’re at the end of their service.”

The boiler system is a money suck, costing the district $14,000 in electrical costs in November alone.

“We had $14,000 in costs for the rest of the district over the last two months. And that’s creeping up,” Grzeskowiak said.

And the boiler still uses pneumatic controls, which “can’t really be fixed, they have to be replaced,” added Grzeskowiak.

School maintenance workers have to cut out the old controllers and replace them with digital controllers. But to do that, they have to enter the walls, which are filled with asbestos.

“So if you go into the walls, they’re going to say, ‘Take out the asbestos.’ So you have to do asbestos abatement on top of the wiring. When you have the wall open, if you’re not fixing any of the plumbing, it’s foolish,” Grzeskowiak said.

One small project to fix the boiler system turns into dozens of projects that include reworking the plumbing, electrical wiring, and asbestos abatement.

Plus, electrical wiring has to be done with special care, because the school does not have any a sprinkler system for fire emergencies.

“It is 135,000 square feet of unsprinkled space,” Grzeskowiak said. “It was originally built when it was not mandated to have one.”

The excise tax would not alleviate this issue, as it could not cover the $4-5 million price tag that would be needed to install one. But lack of sprinklers creates another issue for the school — If they do any major renovations, the grandfather clause on the sprinklers go away, and the district would have to float the bill for the addition, which it currently can’t afford.

“There was a function of the doors, and the thresholds had to be changed all around that area. We get into this thing where people talk about preparing for an earthquake, I’m just talking about preparing for building code,” the superintendent said. “You get to a point where you come in and the building inspector will say, ‘If you’re making change A, it’s going to trigger B,C, D and E.”

So the district is constantly making repairs piecemeal, a delicate balance of fixing immediate concerns without triggering state regulations.

“We did hire an additional maintenance person to work within the district, because there are so many small projects that we do that two people can’t do on their own,” Grzeskowiak said. “We needed a third to do some preventative maintenance.”

That’s just for maintaining what the school has. Updating the district to meet needs beyond what was intended in the 1960s is also a challenge.

“We’re talking about air circulation, electrical capacity and trying to build an environment for the 21st century that has a true, native digital component to learning. That’s hard to do,” Grzeskowiak said. “Nobody could see that far into the future when the building was designed.”

As an example, he brought up wiring the elementary school for wireless internet.

“That building has twice as many access points as it should have if it were a new building,” Grzeskowiak said. “Because of the way it was built at the time, you have these large structural pieces that create these shadow interference zones. You just can’t put a data point in an area to serve a 120-square-foot radius. You have two or three because there’s these physical and electrical shadows.”

That cost of that project was covered by both grants and funds from the facility maintenance account, but as the projects keep piling up, so do the costs, which stress the maintenance budget.

With an extra $45,000 a year, the excise tax can help mitigate these costs. But upcoming housing projects could test the limits of what the school buildings themselves can handle, while at the same time bringing in a financial windfall for the district.

In the summer of, 2018, the City of Florence completed a Housing Needs Analysis that showed Florence has a pent-up housing demand of more than 500 units. Since then, the city staff, along with developers and city volunteers have put in thousands of hours preparing proposals for projects throughout the city. Though the city has not released an official inventory of housing projects, the Siuslaw News looked at all the housing projects brought before the Planning Commission the past year and a half. The results show that the city’s work has them well under way to reaching the goal of 500 homes by 2025.

In 2019, the city issues a total of 43 dwelling permits, and more are expected in the coming years.

Some of the larger projects include a 119-unit subdivision located north of town called the Sand Pine Ranch, which will be less than a mile from Cannery Station, which is expected to bring 42 units. Oak Commons, located just south of 32nd Street, will create 16 homes, and the DevNW project (formerly known as NEDCO) will bring 12 homes to the area.

These are projects that have been officially proposed to the city, and there are many more projects in early phases.

Grzeskowiak stated that the new housing is more than welcome.

“It’s tough to find a house,” he said about finding housing for new district staff. “You got people traveling with their life. That’s been some of the challenges the last couple of years, hiring staff and helping them find housing. You talk about workforce housing — if your teachers can’t find a house, people in other industries, those who work for the city or a service industry, they’re not going to find a house either.”

But an increase of housing can put stress on a facilities that are already close to capacity.

“It always seems to be that our biggest class of kids, every time we have another kid that moves into the district, it’s ‘Oh gosh, another seventh-grader,’” Grzeskowiak said. “You get eight seventh-graders and all of a sudden, you’re at capacity.”

Capacity is a major concern for the district, both in being physically able to house students in the current facilities, as well as finding staff to teach them. Overcrowding in classes can create a wide variety of issues, as was evident this year with the district’s kindergarten classes.

“When we looked at our initial kindergarten enrollment estimates for the last couple of years, our preliminary estimate was about five [additional] kids,” Grzeskowiak said. “Then in the last two years, all of a sudden we got more than 20 kids than our initial projections. When we did that last year, we were pretty confident it was going to be 90 kids. We got to the start of school, and we were at 105. Just that few extra kids, even with a teacher and an aide, that’s a lot in the room.”

With overcrowding comes issues with behavior.

“If you have a bigger group of kids, it’s harder to manage behaviors,” Grzeskowiak said. “It’s not that we had more kids with more behaviors. If you have a kid that’s having an issue with 20 kids in a class, it’s easier to give them individual attention and deal with that, than it is in a class with 27 or 28.”

The district was able to hire an additional kindergarten teacher and split up the classes, alleviating much of the problem. But having a shortage of teachers isn’t the only issue that the district has to be aware of when looking at an influx of students — it could have too many teachers if the housing boom doesn’t come to fruition.

“This is about the time of year that we start doing our budget analysis for Oregon Department of Education,” Grzeskowiak said. “You have to give them a population count, and it’s not for now, it’s for next year.”

The school district has to project what the student population is going to be in order to budget for teachers next year. It’s a difficult task, particularly when the state of housing is in flux. The DevNW development was supposed to be completed in 2019, but it wasn’t. The Habitat homes could be coming as soon as next year, but the numbers are not known.

“We tend to estimate that number fairly conservatively,” Grzeskowiak said. “You go with the lowest enrollment across the year up to this point in time. If you overestimate the budget on that, you have to make an almost overcorrection, and people you hired never work a day and they end up getting fired. Realistically, if our estimate is off by as little as 15 kids, that costs us a staff member. It’s like playing three-dimensional chess.”

All this is not to say that the school is overcrowded and underperforming.

“Right now, the school is doing well,” Rosinbaum said. “We’re educating children, the staff and administration is getting our graduation rates up. We’re doing a lot of really great things, and we’re managing the public’s money really well. However, if you start building a bunch of new houses, that’s a bunch of new families that are coming in. And we’re not going to be able to support them. We’re at capacity now. If you want your children to have the education that we’re providing right now, or perhaps an even better education, at some point, we’re going to have to update the facility.”


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