The hottest issue in the legislature this session finally came out of the closest Tuesday, with the first public hearing on personal property tax relief.

The House Revenue and Taxation Committee held a two-and-a-half hour hearing on two competing proposals:

One, supported by the Idaho Association of Counties, would exempt the first $100,000 in personal property per county, as well as exclude from taxation any item that cost less than $1,500. It would cost local governments about $19 million; that entire amount would be reimbursed by the state, in perpetuity.

The second, promoted by the Idaho Association of Industry and Commerce, eliminates the entire $141 million personal property tax over seven years, reimbursing local governments for $120 million of that amount.

The committee didn't vote on either proposal, but took testimony from more than three dozen people. Partial elimination garnered the most support, particularly from local government officials.

Mark Mitton, city administrator for Burley, said the IACI proposal “is way too expensive for the state and it doesn't provide any future growth in revenue. (It) would make cities, counties and school districts too dependent on state revenue.”

However, Jeff Sayer, director of the Idaho Department of Commerce, offered his enthusiastic support for full elimination.

“We need to drive costs down as low as we can, and eliminating this tax gets us there,” he said.

For more on this story, see Wednesday's Lewiston Tribune.