Tax cuts, transportation funding, dam breaching and a failed veto override highlighted the 88th day of the 2021 Idaho legislative session in Boise on Thursday.
The tax cut and transportation funding bills have a combined ongoing cost in excess of $235 million per year. That’s equal to about 6 percent of current general fund tax collections.
Details from some of the day’s activities:
A DAM BAD IDEA — Lewiston Reps. Mike Kingsley and Aaron von Ehlinger joined Rep. Caroline Troy, R-Genesee, in urging House lawmakers to oppose dam removal efforts on the Columbia-Snake River system.
Their comments came during the floor debate on Senate Joint Memorial 103, which was introduced less than a month after Idaho Congressman Mike Simpson unveiled a $34 billion plan to breach the four lower Snake River dams.
“This is a dam bad idea,” Kingsley said of the proposal. “This will devastate the Lewis-Clark Valley. There are so many other things we can do before it gets to the point of removing the dams.”
For example, he noted the presence of sea lions in the lower Columbia River, and their avidity for salmon.
“They’re just born to eat. That’s what they do,” Kingsley said. “We should manage sea lions just like we manage wolves.”
Von Ehlinger encouraged Idahoans to “fight tooth and nail to make sure our dams stay intact.”
“My district, District 6 in Nez Perce and Lewis counties, is ground zero for how removing the dams would affect the region and the state,” he said. “They don’t even know if taking out the dams would help salmon. This is all a tactic by environmentalists to try to take out the dams. ... It’s a nasty game they’re playing, and we can’t allow it.”
House Minority Leader Ilana Rubel, D-Boise, noted livelihoods are at stake on both sides of the dam-breaching debate.
“That’s part of my concern,” she said. “This memorial presents a very one-sided view of the issue. This is an incredibly complex question, and I think we owe it to all Idahoans to acknowledge there are vital economic interests on both sides that need to be weighed.”
The joint memorial has no practical effect, other than expressing the Legislature’s opposition to dam breaching. It also recognizing “the international competitiveness, multimodal transportation and economic development benefits provided by the Port of Lewiston.”
The measure previously passed the Senate 28-6. It passed the House on Thursday on a 58-12 party-line vote.
ROADS VERSUS SCHOOLS — Legislation that more than quadruples the amount of general fund tax revenue going to the state highway system passed the House 59-11 and moved to the Senate for further action.
Several earlier versions of House Bill 362 were introduced this session — including one that would have tripled vehicle title fees. However, that politically difficult idea was quickly jettisoned in favor of skimming more sales tax dollars off the top.
The state historically has avoided using sales or income tax revenues to pay for transportation projects, because it puts road funding in direct conflict with funding for public education and all other general government services.
That line in the sand began eroding a few years ago. Under current law, 1 percent of gross state sales tax receipts, or a minimum of $15 million, goes to the Idaho Transportation Department to help bond for state highway projects.
HB 362 increases that to 4.5 percent, or a minimum of $80 million. The fiscal note on the bill estimates it would allow ITD to bond for $1.6 billion over 20 years.
If sales tax receipts continue to grow and the 4.5 percent brings in more than $80 million, the excess would go to local units of government to use on local road and bridge projects.
House Transportation Chairman Joe Palmer, R-Meridian, said that makes it a win-win bill for the entire state.
“The $80 million would go to ITD continuously,” he said. “Any remainder, including growth, will go to the locals. It should be a good bill for all.”
During the House floor debate, Rep. Ron Nate, R-Rexburg, suggested the bill was unconstitutional because it involved debt financing for transportation project.
“The Idaho Constitution doesn’t allow for debt. It doesn’t allow borrowing,” he said. “The amount of spending in a given year can’t exceed tax collections.”
Rep. Priscilla Giddings, R-White Bird, apparently shared Nate’s concerns. She and several other Republicans voted against the bill, which passed 59-11. All other representatives from north central Idaho supported the measure.
Palmer noted that an earlier version of HB 362 included the same bonding mechanism. It passed the House 63-4, with Nate and Giddings voting in support.
“The only way we take care of big (transportation) projects is to do this,” Palmer said. “This bill will be good for every single district in Idaho.”
TAX CUTS VERSUS SCHOOLS — The Senate Local Government and Taxation Committee voiced broad support for a $390 million tax cut proposal, sending the measure to the Senate floor for possible amendments.
House Bill 332 includes $170 million in ongoing income tax reductions, plus a one-time, $220 million tax rebate.
The legislation reduces Idaho’s top corporate and individual income tax rates from 6.925 percent to 6.5 percent, and lowers all other individual income tax brackets.
Idaho residents who file a 2020 income tax return would also receive a tax rebate of $50 per taxpayer and dependent, or 9 percent of their 2019 income taxes paid, whichever is greater.
Kathy Dawes, of Moscow, testified in opposition to the bill. Speaking on behalf of Susan Ripley, president of the League of Women Voters of Idaho, Dawes said it was inappropriate for the Legislature to be cutting revenues at a time when most Idaho school districts rely on supplemental levies just to maintain education programs.
“Until education is properly funding, the burden of supplemental levies will be evident on property tax bills,” she said. “It doesn’t make sense to cut taxes in other areas until schools are funded to a degree that supplemental levies can be significantly reduced or eliminated.”
Republicans on the committee were enthusiastic about the bill. However, they wanted to consider a couple of possible amendments.
For example, Sen. Steve Vick, R-Dalton Gardens, said he would like to reduce the number of tax brackets in Idaho’s individual income tax code.
Sen. Todd Lakey, R-Nampa, also wants to maintain a sunset provision on the sales tax relief account, which collects sales tax revenues from online purchases.
HB 332 taps the tax relief account for about $110 million of the $170 million ongoing cost of the proposed tax cuts. It also removes the sunset provision, which was originally put in place to ensure that local governments get a share of the online sales tax revenues after fiscal 2024.
The House approved the original version of the bill on a 58-12 party-line vote. If it’s amended and passed in the Senate, the House would have to concur or accept any changes before the bill moves on to the governor.
AND STILL CHAMPION — The Senate began Thursday with a vote to override the governor’s veto on House Bill 214, which proposed certain limitations on the authority of the chairman of the Idaho State Tax Commission.
The House enthusiastically agreed to defy the governor, voting 62-7 Wednesday to override the veto.
However, the Senate could only muster 21 votes in support of the override. That was three votes short of the two-thirds necessary, so the governor’s veto was sustained.
The last successful veto override vote was in 2007. It’s only happened about five times in the past 60 years.
LET’S GET TO THE BOTTOM OF THIS — Lt. Gov. Janice McGeachin announced plans to create a task force “to examine indoctrination in Idaho education and to protect our young people from the scourge of critical race theory, socialism, communism and Marxism.”
“As I’ve traveled around the state and spoken with constituents and parents, it has become clear that this is one of the most significant threats facing our society today,” she said in a news release. “We must find where these insidious theories and philosophies are lurking and excise them from our education system.”
Rep. Priscilla Giddings, R-White Bird, has been asked to participate in the task force.
“I appreciate the lieutenant governor taking the initiative to push back against the flawed concept that white people are inherently racist, and that our young people should be made to feel guilty for actions they have never committed,” Giddings said. “This is the kind of proactive leadership Idaho so desperately needs right now.”
Spence covers politics for the Tribune. He may be contacted at bspence@lmtribune.com or (208) 791-9168.
