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Education advocates push for new way to fund school construction costs

Idaho State Capitol
Posted at 1:59 PM, Jan 26, 2022
and last updated 2022-01-31 08:06:24-05

BOISE, Idaho — Some education leaders and lobbyists are advocating for a new way to fund school construction costs.

It's an issue that's been a conversation topic among education leaders and lawmakers since the '90s. Through this funding method, a fee would be collected from new development and given to public school districts to fund new school buildings.

Education advocates say this would mean growth pays for growth.

Population Growth Impacts Public School Enrollment

Before the pandemic slowed in-person enrollment at many public schools, the West Ada School District was adding an average of 655 students per year.

“We’re growing in Star, we’re growing in south Meridian and we have some spots in Eagle that are definitely growing,” said Marci Horner, the planning and development administrator for the West Ada School District.

This growth impacts every area of life, including public school enrollment.

“That’s impacting education in the terms that it’s bringing more school-age population into the city and so we’re seeing more enrollment at schools,” Miranda Carson with the City of Meridian said.

When enrollment continues to increase year after year, eventually new school buildings become a necessity.

“Land is really expensive so we need to try to do that in enough time to where we can purchase land at a price that is not an exorbitant rate — we can’t pay what developers can pay for land,” Horner said. “It would be really great if we could say, we are going to need this school in three years so we are going to start building it now. Unfortunately, we can’t do that necessarily because of the funding. Our operating expenses right now don’t allow for us to just build a building.”

This rapid growth and increasing public school enrollment is becoming an issue across Idaho.

“It used to happen sort of in the Treasure Valley — right it was always meridian, eagle, but it’s happening all over the state now,” said Quinn Perry, the deputy director and government affairs for the Idaho School boards Association.

In Idaho, taxpayers are burdened with the cost to build a new school building.

“The only way for school districts to build new facilities is through bond levies and bond levies are extremely difficult to pass in Idaho because Idaho's constitution requires a supermajority requirement for those to pass which means that you need 66.7% of your voters to agree to tax themselves for a bond levy,” Perry said.

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Impact Fees

Some Idaho school districts and the IDSBA are asking lawmakers to give them another way to pay for new school buildings, by charging impact fees.

“Impact fees are paid by new developments to support the infrastructure of the development and of the area,” Horner said.

Idaho law currently allows local governments to charge impact fees on new developments to pay for public facilities. These are things like wastewater collection and treatment, roads and bridges, parks and public safety facilities.

“Public schools are not defined as a public facility so we are not able to collect impact fees,” Horner said.

The idea behind allowing schools to collect these fees is for growth to pay for growth.

“This idea that you’re paying this one-time fee to help make sure that services are being provided at the level of service that community members expect,” Perry said. “We argue of course that when growth happens it does have an impact on your school district and our ability to provide those services to kids. If large groups of families move to this community, they expect public schools to be a facility that they can utilize.”

In 2021, the Kuna and Middleton School Districts introduced a resolution at an Idaho School Boards Association meeting for the IDSBA to work with the state legislature to pass legislation adding public schools to the list of public facilities that can collect impact fees.

The resolution passed overwhelmingly, showing Idaho Public School Districts are in favor of this move.

From developer's perspective, the Building Contractors Association of Southwestern Idaho is for them.

"Because in many cases it will accelerate the process of meeting the demand for new homes and homes in general. But it has to be countered with, what are the ultimate costs? And are the consumers who are looking to buy those homes ready, willing and able to absorb those costs?" said Bill Bauer, the executive officer of the BCA of Southwestern Idaho.

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The Effort for Legislation

Now, Democratic Rep. Lauren Necochea of Boise and Democratic Sen. Grant Burgoyne of Boise are working on legislation they plan to introduce soon.

“The bill doesn’t have to be complicated. All we have to do are add our school districts to the entities that are allowed to collect impact fees,” Necochea said.

There have been several proposals on this topic over the last roughly 30 years.

“A couple of Democrats put forward a couple of proposals a couple years ago and we just haven’t been able to get a hearing," Necochea said.

This year, Democrats are hoping to get a Republican to co-sponsor the bill.

"It just needs talking to folks on the other side of the aisle and seeing if we can finally get a green light for a hearing," Necochea said.

But some on the other side of the aisle still have concerns, including whether this would be constitutional.

"In my opinion, an impact fee would be unconstitutional — or would be likely to be held unconstitutional if it’s for schools. While it’s not for roads or fire departments because those have a little different connection to every single building that’s being built," Republican Sen. Jim Rice of Caldwell said.

The IDSBA argues the connection isn’t so different.

"I think that we can all agree that public schools do provide a community-wide benefit similar to how fire and public safety provide that same community benefit," Perry said.

Rice, chairman of the Local Government and Taxation Committee, said the issue is more complex.

“You can’t tax the same property twice in the same year for the same purpose,” he said. “If somebody’s trying to craft something, they’re going to need to make sure that they don’t fall afoul of those principles and that’s made it a rather difficult issue. That’s also caused it to have a lot of resistance to it.”

In 2020, Necochea asked the Attorney General’s office to weigh in on the issue.

In an email Necochea shared with Idaho News 6, Deputy Attorney General Brian Kane did not issue an official opinion, but answered Necochea's questions as requested. He said there might be development size requirements and that municipal fees may cross the line and become impermissible taxes.

The BCA of Southwestern Idaho also has some questions before they can get behind any proposed legislation. In addition to constitutionality, there are questions about school districts' ability to propose bond levies.

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"What would happen with that? Would that go away? Would it continue to exist and create two sources?" Rauer said.

They also have questions about whether impact fees as they're currently written in state statutes would really help school districts and whether homebuyers would be willing to shoulder the additional cost.

Rice said there are some other options that could be considered to address public school construction cost.

“I think one way would be to create another dedicated fund that we use for school construction. We’ve started down that road in the past, I think we could go further down that road, especially when we have large surpluses,” he said.