BOISE – With cries coming from around the state for Idaho to loosen up and let communities have local-option taxing authority for transportation, a House committee instead approved a constitutional amendment to sharply limit all local-option taxing.
House GOP leaders said it’s the only way local-option sales taxes will pass the Legislature. “If you don’t have this, you don’t get the other one – that’s just the way it is,” said House Majority Leader Mike Moyle, R-Star.
The proposal, which cleared the House Revenue and Taxation Committee on Friday on a party-line vote with all the committee’s Democrats objecting, would limit local-option taxes to a two-thirds vote in November general elections. They could be sought only by counties or cities.
House GOP leaders say they’ll now be willing to consider local-option taxes for any purpose.
“We’ve not been deaf,” said House Assistant Majority Leader Scott Bedke, R-Oakley. “Counties have been clamoring for a long time to come up with another revenue source.”
Idaho limits local governments’ taxing authority almost exclusively to property taxes. After extensive legislative fights, a few narrowly drawn local-option sales tax measures have been approved, including one for resort cities and another that Kootenai County has used to finance a jail expansion and property tax relief.
The constitutional amendment doesn’t specify permitted uses for the local taxes. But it would require the same legislative approval process for any new local-option tax that Kootenai County fought its way through earlier.
Bedke said he favors legislation to allow any city or county to do what the amendment allows, for any purpose it chooses – but no such legislation has been introduced.
House Speaker Lawerence Denney, R-Midvale, said, “I agree – I think it should be broad-based … If we really want to address the local-option tax issue this year, I think this is the only way we can get that done.”
A statewide coalition that’s been working for five years to develop a consensus local-option sales tax law for transportation needs opposes the committee’s plan. Spokesman Roy Eiguren said requiring two-thirds within each county would crimp regional efforts to address regional issues.
“Our view is that roads and transportation systems do not stop on the county line,” he told the committee.
In the 13-5 committee vote, Republican Reps. Dick Harwood, of St. Maries; Phil Hart, of Athol; and Jim Clark, of Hayden Lake, voted for the amendment, while Rep. George Sayler, D-Coeur d’Alene, voted against it.
The amendment needs two-thirds approval from each house and a majority vote in the next election to amend the state constitution.
Chambers of commerce in Boise, Coeur d’Alene and Garden City have voted to oppose the amendment, while the Idaho Falls chamber voted to support it.