Upcoming CPRD system development charge increase explained
An increase in system development charges is on tap for July 1, 2020, and the Chehalem Park & Recreation District is expected to officially approve that increase at its Dec. 4 board meeting. While the next increment of the increase was announced many months ago, there is still some confusion from citizens on why the charges are being increased and by how much.
System development charges (SDCs) are, according to the CPRD website, "fees assessed to new development, additions, and changes of use. These fees are collected to help offset the effect that projects will have on a community's infrastructure of storm and sanitary sewer systems, parks and recreation facilities, water and street systems."
Don Loving, vice president of the CPRD board, said the upcoming increase – which amounts to a 4.79 percent hike from last year's fee – is an effort to up the fees on a yearly basis so builders and local entities who are building homes can adjust accordingly.
"Two years ago, there was a big hullabaloo because we raised SDCs for the first time in decades," Loving said. "Because we waited so long, they went up by a lot and people were upset. So now we are doing it on a year-by-year basis and this is just another year going by.
"Usually it's going to be a 3, 4 or 5 percent increase every year if the economy is doing well, which it is. We adjust the SDCs accordingly so it's a few hundred dollars a year rather than thousands after a period of years."
The reason SDCs increase on July 1 is because that is the start of a new fiscal year for CPRD, so it makes more sense for them to reset at that point. Loving explained that the charges are intended to help pay for the park and recreation facilities in Newberg and their maintenance as the population continues to rise in the area.
They are added to the cost of a home for someone purchasing one in Newberg as a result of being added to the cost of doing business for the builder or company. Sometimes, local entities like George Fox University – which did so for its residence halls – can apply for and receive a fee waiver or reduction in order to make up some of those costs.
"The park district has one system development charge for the park district," Loving said. "Other entities have them as well. The idea behind ours is that when you build a new house, the people who live there have a stake in all the facilities that are around town in Newberg and Dundee, so they have to pay to continue funding and maintaining those.
"If you're not building a new house, this doesn't affect you. If you are a builder or you're a citizen building your own house, you're going to have to pay SDCs on that. We have waivers and reductions available for those who need them, but otherwise it's what people need to pay."
For more information on SDCs and how they might affect builders in the coming fiscal year, visit www.cprdnewberg.org/general/page/system-development-charges-sdcs.
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