Clark Legislates By The Numbers Panel Oks Freshman’s Bill Diverting Tax Money Into Reserve Account

Don’t try to debate abortion or vicious dogs with Rep. Jim Clark. He’d rather talk about taxes or the state budget. The freshman Republican from Hayden has introduced seven bills so far this year, most of them on financial matters.

Thursday afternoon, he persuaded the House Appropriations Committee to endorse the biggest one of the bunch - a bill that would change the way Idaho budgets its money, forcing the state to divert millions into a reserve account whenever it has a good year.

“I ran on less taxation, market-based solutions to public education, and that’s what I’m trying to do,” Clark said. “If I can’t get property tax relief, then I’m going to look at the budgeting side.”

The issues Clark’s addressing are complicated. House Revenue and Taxation Committee Chairman Donna Jones drew laughter this week when she accused Clark of trying to add an extra week to the legislative session. Clark, an economist who runs a management consulting firm, said, “I don’t mean it that way. I’m concerned about tax issues, and I’m concerned about budgeting issues.”

Chief among them is his Budget Stabilization Fund bill. “I would like to see that get through,” he said. “It’s a good way of doing business.”

The measure, HB 443, would require that whenever state revenues grow by more than 4 percent, the state must set aside 1 percent of the following year’s budget in a special fund. If it had applied this year, close to $15 million would have been squirreled away. The money in the fund couldn’t be tapped unless lawmakers take a two-thirds vote to do so, and at least half the balance would have to be left in the fund when withdrawals are made.

Clark offered Thursday to lower the vote requirement to a simple majority, and the Appropriations Committee went along.

Interest on money in the new fund would go to the state’s Permanent Building Fund, the cash-starved account that pays for new state buildings.

Clark said the goal is to build a reserve of 5 percent of the state budget - which would be about $75 million. Idaho now has $36 million in reserve, with no requirement for any particular amount to go in each year. Lawmakers this year put in $8.5 million. Clark said the stabilization fund could help Idaho avoid raising taxes, and could prevent midyear budget cuts like those imposed last year and the year before.

A version of the bill passed the Senate last year, but never made it to a vote in the House. Clark said, “People thought last year that because a freshman was carrying it, it was a joke.”

Appropriations Committee members took it seriously Thursday. Chairman Rep. Bob Geddes, R-Preston, recalled the 1982 legislative session. “We came to town with a $70 million shortfall.”

That year, the Legislature raised the sales tax. “Had something like this been in place, it would have been a godsend, that particular year at least,” Geddes said.

The committee, however, was split. Rep. Ken Robison, D-Boise, said, “By passing this, we would be saying the No. 1 budget priority we have … is to add to the reserve fund, rather than funding education or anything else.”

But the committee endorsed the bill with a 5-3 vote.

Among those voting against it was Rep. Don Pischner, the only Panhandle member of the budget committee. Pischner also opposed the measure last year.

“I’m troubled by the amount of money that goes in there, and the fact that half of the money’s in there and you can’t get it out,” he said. Pischner said taxpayers would ask “why this tax money is set aside and can’t be spent.”

“I think the bill has a ways to go,” he said.

Clark wasn’t fazed, and said he got the votes he expected. “It’s a difficult concept,” he said, “but do-able.”

He’s looking ahead to the next in a series of 7:30 a.m. subcommittee meetings, at which a group of Revenue and Taxation members are dissecting some of his tax bills.

“I get in here early anyway,” he said cheerfully. “I’m usually in here by 6.”

, DataTimes ILLUSTRATION: Photo

MEMO: This sidebar appeared with the story: Clark’s bills HB 476, limits use of foregone balance by taxing districts. HB 544, allows agencies and companies to collaborate to provide utility service. HB 443, Budget Stabilization Fund. HB 595, sets aside a portion of sales tax proceeds to reduce public school indebtedness. HB 575, makes prison or jail operations manuals confidential. HB 574, municipal election law amendments. HB 620, increases tax credit for education contributions.