Rep. Erpelding catches wrong clause in Commerce director’s tax break bill
Rep. Mat Erpelding, D-Boise, was listening to state Commerce Director Jeff Sayer present his bill in Rev & Tax today to make changes to the “Tax Reimbursement Incentive Act,” which already is giving big tax credits to companies that add or bring in jobs that pay more than the average wages in the counties. Sayer was telling the House Revenue & Taxation Committee that he’d decided not to ask to relax the rule about exceeding the average wage in the county. “The big change we originally started out asking for that related to modifying how we originally used the county wage, we’ve pulled back from that,” Sayer told the committee.
But Erpelding pointed out that it was still in there – right there in the bill that the committee had before it. After a bit of scrambling, Sayer said, “I’m really sorry, Mr. Chairman. We have an updated RS. … That’s the section that we struck.”
Rev & Tax Chairman Rep. Gary Collins, R-Nampa, said, “Thank you for pointing that out, representative. I was starting to wonder where he was reading from, too.” As a new version of the proposed bill was distributed to the committee, Collins said, “Let’s start over again just a little bit and walk through that.”
Rep. Ron Nate, R-Rexburg, said he still has concerns about the bill, though he didn’t oppose introducing it. “I still do have concerns because of the fairness issues to existing businesses,” Nate said. “If I’m an existing hotel, maybe I was just built two years ago and I’m operating close to my margins and everything ... It would be really disturbing to me to see a new hotel come in that enjoys a 30 percent cut in its taxes because they’ve qualified under this program.”
A new Limelight Hotel in Ketchum proposed by Aspen Skiing Co. is among the businesses that have qualified for the new tax break, which provides a tax credit of up to 30 percent of a business’s state income, sales and payroll taxes for up to 15 years if it brings in additional jobs. The Limelight Hotel project was awarded a three-year, 16 percent tax break; it's promising to bring in 57 jobs at an average annual wage $41,000. Nate said when the bill comes back to the committee for a hearing, he’s hoping for “further discussion.”
Outside the committee hearing room afterward - after the committee had voted to introduce the new version of the bill - Sayer thanked Erpelding for pointing out the discrepancy. “That was bizarre,” Erpelding responded. “I was like, ‘This isn’t what he’s explaining.’
