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Eye On Boise

Mon., March 21, 2011, 8:34 a.m.

Panel endorses Otter’s ‘Hire One’ job tax credit bill

Mark Warbis, aide to Gov. Butch Otter, pitches the governor's
Mark Warbis, aide to Gov. Butch Otter, pitches the governor's "Hire One Act" to provide a tax credit for new jobs, in the House Revenue & Taxation Committee on Monday morning. The panel unanimously endorsed the bill and sent it to the full House; an earlier version, proposed by the Idaho Chamber Alliance, passed the House but died in a Senate committee. (Betsy Russell)

The House Revenue & Taxation Committee has voted unanimously in favor of Gov. Butch Otter's proposed "Hire One Act," which would provide a sliding-scale tax credit for employers adding new workers, with those who've made less use of the state's unemployment insurance system in the recession getting a higher credit. "What we are trying to do with this piece of legislation is show our confidence in our economy," Otter aide Mark Warbis told the committee this morning. Warbis said the bill was designed to address a concern from senators who killed an earlier jobs tax credit bill, about rewarding employers who've laid people off during the recession and now are beginning to hire them back. The sliding scale, which varies from 2 percent to 6 percent of the new employee's gross wages, is "for those employers that have been good corporate citizens during the recession," Warbis said, "and actually made a priority of keeping employees on the job." Those who've paid in more to the unemployment insurance system than their laid-off employees have drawn out would get the 6 percent credit; those with average ratings on that get 4 percent; and those with negative ratings get 2 percent.

The bill allows jobs paying $12 an hour and providing benefits to qualify for the credit in counties with more than 10 percent unemployment, and $15 an hour in counties with less. State Commerce Director Don Dietrich noted that the credit would expire after three years; it's retroactive to Jan. 1 of this year. "The sunset provides the motivation to hire now," Dietrich told lawmakers. "This legislation is about creating jobs today and providing a jump-start to Idaho's economy."

The name of the proposed new law echoes Otter's call in his State of the State message this year for every Idaho employer to hire one new worker to boost the state economy. However, the state itself is looking at possibly eliminating hundreds of public and private-sector jobs next year through budget cuts, including those in the Medicaid program and the public schools. The credit is estimated to cost the state general fund $7.9 million a year, but generate $25.3 million in new tax revenue to offset that. It was previously introduced as HB 279, but Warbis said today that the bill was missing a line, so the committee introduced a new version, which hasn't yet gotten a bill number, and sent it directly to the full House's 2nd Reading Calendar.

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Betsy Z. Russell
Betsy Z. Russell joined The Spokesman-Review in 1991. She currently is a reporter in the Boise Bureau covering Idaho state government and politics, and other news from Idaho's state capital.

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