Senate Oks Kootenai Resort Tax Bill Allows County Voters To Increase Sales Tax

With Kootenai County’s state senators united behind it, the county’s special resort tax proposal passed the Senate Tuesday on a 23-10 vote.

The measure, sought by Coeur d’Alene, Post Falls and Kootenai County, allows the county’s voters, by at least a 60 percent vote, to approve a local-option sales tax. At least half the proceeds would go to property tax relief.

“If you have no other reason to vote for this bill, I would just remind you of where the One Percent (property tax-limiting initiative) was born,” Sen. Gordon Crow, R-Hayden, told the Senate, referring to Kootenai County.

“It lets the people in the county decide whether they want to approve it,” said Sen. Mary Lou Reed, D-Coeur d’Alene.

“It will increase revenues from tourists and transients who place a significant demand on services now paid by property taxpayers,” said Sen. Clyde Boatright, R-Rathdrum. “It’s the right thing to do.”

The tax would apply to all sales in Kootenai County now subject to the state sales tax. Only property owners would get money back through tax savings.

Because the Senate added a minor technical amendment, the House will have to agree to the bill before it can go to the governor. The bill passed the House earlier on a 48-22 vote.

The Senate debate differed from the House debate in that all of Kootenai County’s senators spoke out in favor of the bill. No one testified against the bill, though Sen. Gary Schroeder, R-Moscow, said he would vote against it because he thought it wasn’t fair for the tax to apply only to Kootenai County.

“We would like one, too,” he said.

During the House debate, no North Idaho lawmakers testified on the floor, and one, Rep. Tom Dorr, R-Post Falls, voted against the bill.

But the measure won support from lawmakers statewide who said it is a well-thought-out plan to address problems unique to Kootenai County.

“I think this is really a pretty well-drafted piece of legislation,” Sen. Ralph “Moon” Wheeler, R-American Falls, told the Senate. “Sixty percent is not easy.”

Sen. Lin Whitworth, D-Inkom, said, “I’m going to support this for these people up north. I swore I’d vote for no tax increases. I’m not. I’m just telling those people they can raise their taxes up there but don’t go do it in Bannock County.”

Crow, the bill’s sponsor on the Senate floor, said afterward, “I think it’s a great bill.”

“It gives us a much-needed tool to reduce the dependence on property tax,” said Coeur d’Alene Mayor Al Hassell.

Officials estimate that a 1 percent local sales tax could bring in $11 million the first year. That would mean at least $5.5 million in property tax relief. Kootenai County Clerk Tom Taggart has said the county would like to devote even more of the money to relieving property taxes. Supporters noted that even with a small increase, the county’s sales tax still would be well below adjacent Spokane County’s 8.1 percent sales tax.

Idaho’s sales tax is now 5 percent.

“This gives us the option locally, and that’s what we need,” Hassell said.

, DataTimes