March 11, 2009 in Idaho

Idaho House kills local-option tax bill

By The Spokesman-Review
 

BOISE - After intense debate, the Idaho House has rejected the only local-option tax bill to make it out of committee this year.

The House voted 31-39 on HB 155a, Rep. Raul Labrador’s local vehicle-registration fee bill, killing the bill.

“We have different needs around the state, and sometimes we need some local authority to take care of those needs,” Labrador, R-Eagle, told the House.

The bill had earlier been amended to require a two-thirds local vote to approve the fees, which would have to be for specific road or bridge projects, rather than a simple majority. That lost it some former supporters who liked the lower vote threshold.

Among those speaking in favor of the bill was Rep. Phil Hart, R-Athol, who said, “I think we need to give the counties something right away to help deal with these transportation issues.”

But Rep. Jim Clark, R-Hayden Lake, said, “What we have here now, of course, is just another back-door approach of how we should get local-option taxing.” Clark said he’s against local-option tax legislation that doesn’t include a restrictive constitutional amendment.

Rep. Fred Wood, R-Burley, asked what happens if projects cost more than anticipated. Labrador said officials would have to go back to voters for approval of any increase, but Wood said, “So in effect the voters are stuck with the bill.”

Rep. Frank Henderson, R-Post Falls, said he’s a supporter of local control, but he opposed the bill. “We all know that transportation is a major subject of the session, and I really think that until this Legislature decides a source of revenues – and certainly automobile registration is going to be one of the factors – I suggest that this bill may be just a little before its time. And for that reason, I reluctantly am going to vote no.”

Rep. Brent Crane, R-Nampa, called the bill “a viable transportation solution” and said if the House can’t agree on it, it probably can’t agree on any transportation issues this year.

House Majority Caucus Chairman Ken Roberts, R-Donnelly, warned, “Those of you that don’t like this bill, I hope that you’re all prepared to vote for a tax increase on regular registration. Because if we don’t give some of these locals a tool … then all of us are going to have to pay for those projects.”

Idaho’s Legislature long has strictly limited local governments’ taxing authority. The few local-option taxes the state allows, like one for resort cities and another that Kootenai County used to finance a new jail with a local sales tax, were approved only after long legislative battles.

Local governments in Idaho are funded almost entirely by the property tax, in which increases are limited by law.


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