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Idaho Democrats open to tax cut proposal

Wed., Jan. 9, 2013

Party urges protection for schools, homeowners

BOISE – Idaho Democrats said Tuesday they’re open to a $141 million personal property tax cut proposed by Gov. Butch Otter to help businesses, provided there’s something in it to protect local governments.

The minority party offered its annual response to Otter’s State of the State speech, when the Republican governor announced he favored local option taxes to help replace money that cities, counties and schools stand to lose from elimination of the tax on business equipment. Idaho businesses are lobbying for the tax cut this year with an intensity Otter says he’s never before experienced.

Even so, Senate Minority Leader Michelle Stennett said local governments must be shielded from cuts to critical services that are now paid for by personal property tax revenue, generated by everything from computers to big transmission lines and railroad tracks.

“The Legislature must ensure that school districts aren’t forced to slash budgets and degrade educational opportunities further,” Stennett, D-Ketchum, told reporters. “And we must not raise taxes on homeowners.”

Democrats are floating proposals of their own, including one from Rep. Grant Burgoyne, D-Boise, to allow cities or counties to raise sales or income taxes within their jurisdictions with a simple majority vote.

House Majority Leader Mike Moyle threw cold water on that idea. Instead, he said Tuesday that he’d favor a phased-in elimination of the personal property tax over the next five years, without the local option tax.

Such a proposal would include some state replacement money, and Otter has so far offered to chip in $20 million. But future funding for local government services would mostly rely on the assumption that revenue would increase from a growing economy.

In addition to Democrats’ comments about the personal property tax repeal, their 13-representative, seven-senator caucus announced plans to again push for an independent ethics panel, a bid that failed last year.

Sen. Branden Durst, D-Boise, plans to introduce a bill that would streamline hiring of disabled veterans for state jobs.

And House Minority Leader John Rusche, D-Lewiston, promised a package of election reforms that could include a vote-by-mail proposal, something voters in Oregon have embraced but that Idaho Republicans have so far rejected.

Democrats kept an upbeat tone – “We are indeed fortunate to live in Idaho,” Rusche said – but did take Otter to task for what they termed lackluster public education support at the K-12 level and for Idaho’s colleges and universities. They want more money for state workers and state facilities that need repairs.

They also didn’t like his plan to sell $70 million in bonds to finance a new 579-bed mental health prison south of Boise, arguing local programs that help people before they wind up behind bars would be a better use of the money.

“Community mental health is sorely needed, but he proposes a mental health prison,” Stennett said.


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