Op-Ed: Questions Remain After CET Funds Awarded to Ineligible Project

Written by Newberg Resident Crystal Poczynek

The Newberg City Council recently discussed awarding the $1 million generated through the Construction Excise Tax (CET) at the June 16 city council meeting. This 1% tax on new residential and commercial construction was implemented in Newberg in 2020. CET was adopted to fund affordable housing projects like foreclosure assistance, down payment assistance, and the development of affordable housing in Newberg.

The tax was in effect from 2020 until 2023, when the City Council decided to end it, hoping to attract additional development in the city. In favor, the Newberg mayor claimed it was unfair to take money from a few (the rich) to pay for initiatives they didn’t want (to help poor people). In a February 2024 Newsberg column titled Mayor’s Musings: Construction Excise Tax (CET), Mayor Bill Rosacker shared that the $1 million CET fund was soon to be distributed for what he referred to as a “legacy project.”

During the City Council meeting on June 16, the “legacy project” was revealed: SPARK Newberg. Rosacker shared that he is part of the SPARK committee and recused himself from further discussion. However, before joining the other committee members, Rosacker stated he believes that 501(c)(3) nonprofits are favored when it comes to receiving funding for affordable housing projects. He “does not believe in giving handouts to people.”

In attendance to apply for the CET awards were SPARK and Habitat for Humanity (HFH), a nonprofit long dedicated to helping low-income families access affordable housing. HFH was the only applicant present to meet the eligibility requirements to apply. Eligible recipients were 501(c)(3) organizations with the aim of creating or preserving affordable housing in Newberg and were subject to approval by the city-formed body, the Affordable Housing Commission. SPARK did not meet the Affordable Housing Commission eligibility requirements and was deemed ineligible for the award. Hence, the remarks from Rosacker criticizing the criteria, claiming it favored 501(c)(3)s. SPARK acknowledged they did not meet the requirements and applied anyway for the total available funds of $1 million.

Mayor Rosacker supports the project, which reads more like an evangelical social experiment, citing content inspiration from conservative Christian Dave Ramsey. The SPARK project requires participants to engage in a five-year financial literacy education program while paying to live on-site in dorm-style housing. Afterward, participants will earn an opportunity to apply for a grant that would cover the down payment on a home purchase. The grant funds will be generated from the rent participants pay to live on-site—market rate plus fees—while attending educational trainings. SPARK applied for the CET award to purchase the land needed to develop the 20-unit buildings. The committee members assured the City Council that completing faith-based criteria would not be required of participants; however, SPARK’s website lists “relational, emotional, and spiritual development” as part of the curriculum. The SPARK committee presented an unfinished concept to the City Council. They have not purchased a property for the proposed 20-unit residence, but hoped the Council would award them the CET funds based on faith that the project would work.

After further questions (which went unanswered) and discussion, the City Council agreed to split the $1 million award between the two applicants—awarding HFH approximately $300,000 and the remaining $700,000 to SPARK Newberg (contingent on the legality, because SPARK is not currently a 501(c)(3)).

As a taxpayer and recent homebuyer in Newberg, I am disappointed with this decision. It seems like a great opportunity to pause. SPARK Newberg did not meet the eligibility requirements for the grant award. They did not present an adequate concept, their idea lacks cultural acuity and affordability, and it only supports a demographic of individuals already economically positioned to purchase homes. There are ways to offer financial literacy education without a lengthy 48-week housing plan that doesn’t even offer participants a guarantee of homeownership. Beyond the out-of-touch belief that people are just too financially irresponsible to buy homes, how exactly are graduates of the program supposed to afford a mortgage that’s twice their current rent? Requiring five years of financial literacy education to justify support is an undue and performative burden. The SPARK Newberg committee stated that the completion of the project would cost closer to $7 million. How much more will Newberg taxpayers be contributing to this project that does not make housing more affordable or create resources for keeping citizens in their homes when facing houselessness?

This decision sets a troubling precedent: one in which loyalty outweighs eligibility. Public funds intended to address Newberg’s affordable housing crisis should be invested in projects with proven capacity and compliance, not wishful thinking. Residents deserve transparency, accountability, and real solutions, not performative programs that lack inclusivity. I urge city leadership to reconsider how it stewards public trust and to prioritize projects that serve the people most in need with dignity.

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