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House narrowly defeats $7.8M tax break for military retirees

The House has narrowly defeated HB 420, the bill from Rep. Kathy Sims, R-Coeur d’Alene, to grant a new state income tax break to military retirees under age 65. Sims said the tax break, estimated to cost the state general fund $7.8 million next year, would draw more young, productive military retirees to move to the state. “I think this is a good welcome home for our military, and I’d ask for your green light,” Sims told the House.

Rep. Maxine Bell, R-Jerome, co-chair of the Legislature’s joint budget committee, spoke against the bill. “I feel like I’m throwing a little cold water, and I’m sorry about that,” she said. “I want to remind you what we have chosen, the paths that we’re on this year.” Lawmakers have made the education task force recommendations – estimated to cost hundreds of millions of dollars over the coming years – a top priority. “We all assume that’s the right thing to do, it’s what’s best for the schools,” Bell said. Plus, the state is looking to incur new costs to reform its public defender system, and for justice reinvestment reforms that are expected to result in big savings in the long term, but be “costly up front.”

Bell noted all the bills pending in this year’s legislative session that would cost money from the state general fund. “Maybe there’ll come a time when we can all have a little tax break,” she said. “But at this point, that revenue stream with diversions is not going to get to the end of the road. Please consider that when you vote, and think of those things that many of us are working on and have committed to, and we should possibly just take care of those.”

Rep. Grant Burgoyne, D-Boise, said, “It’s very difficult for me to vote against a veterans bill, I do not like to do it.” But he said the price tag is too high. Sims said the cost estimate is for the highest possible cost. “The numbers can be whatever you want them to be, and I gave you the highest number,” she told the House. But the bill failed on a 31-35 vote.


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Betsy Z. Russell covers Idaho news from The Spokesman-Review's bureau in Boise.

Named best state-based political blog in Idaho for 2013 by The Fix

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