Idaho Gov. Otter wants more education improvements, tax cuts

BOISE - Idaho Gov. Butch Otter touted the state’s economic growth as proof that his strategy of refraining from raising taxes during the recession worked.

And Otter then outlined during his annual address to the business community on Wednesday his top priorities for his final legislative session next year: Education and tax cuts.

“We need to keep investing and improving in K-through-career education opportunities,” he said. “My highest priority is and will continue to be building a more educated and skilled workforce.”

The third-term governor noted that the state is in the third year of his five-year, $350 million plan to improve the state’s schools, including raising teacher pay. Otter recalled serving on the Education Committee in the Idaho House back in the early 1970s, and said now, for the first time, he’s no longer hearing “those robust debates about teachers are paid way too much, about there should be a greater responsibility someplace else, other than us. Read the Constitution of the state of Idaho,” he said. “The state shall provide for a system of free, uniform and common public schools.

“There’s no better direction that we can have in our legislative purpose and our political efforts than to honor the Constitution,” Otter declared. “So you can expect that my efforts on education are going to continue.”

That drew applause from the 500 business leaders assembled in the CenturyLink Arena in Boise for Otter’s luncheon address.

He also touted two proposals for cutting taxes next year: His proposal to cut unemployment insurance tax rates, which would have saved Idaho employers $115 million over three years if it hadn’t gotten caught in late-session wrangling during this year’s legislative session; and cuts in state personal and corporate income tax rates.

The unemployment tax change was popular, but got caught in a tussle between GOP lawmakers who wanted to cut income tax rates, and those who wanted to remove the state’s 6 percent sales tax from groceries. The grocery tax cut passed, but Otter vetoed it; his veto is now being challenged in court. Both other proposals went unaddressed, including the unemployment tax.

“That is going to be Job 1 when we start in January, because it’s terribly important,” Otter said.

He said it will enable Idaho employers to make badly needed capital investments in their businesses.

“I’m also encouraging the Legislature to revisit its discussion on cutting our personal and corporate income tax by one-tenth of one percent,” the Republican governor said.

Otter said if those income tax rates are going to be reduced, he favors cutting both categories – personal and corporate – by like amounts, “so that we address the entirety of our economy.”

The crowd was receptive as Otter focused on Idaho’s recent good economic news, including newly released figures for state tax revenues that show May revenues beat forecasts by 7.8 percent and exceeded last May’s revenues by 12.2 percent. That brings the state’s revenues for the fiscal year to date – which has one month remaining – to 2.1 percent above forecasts and 8.1 percent higher than last year.

Otter also touted strong job-growth figures and low unemployment rates in the state. “There’s lots of good news, folks,” he said. “I can tell you that we’re on a great track.”

Even with low unemployment, though, he said the state has 4,400 high-salaried, hard-to-fill jobs open, many in medical fields. He said Idaho needs to beef up education and training so Idahoans can fill those jobs. “We’re going to continue to work on that, rest assured,” he said.