Otter signs bill to cap homeowner’s exemption

BOISE - Without comment, Idaho Gov. Butch Otter has signed into law HB 431, the bill to cap the homeowner’s exemption from property taxes at $100,000, removing an inflation index that otherwise would have allowed it to rise in the future as home values go up.

The bill was backed by the Idaho Association of Realtors.

It would permanently fix the exemption at half the value of the home and lot or $100,000, whichever is less.

The bill passed the House on a 55-15 vote, and the Senate, 23-11, with North Idaho lawmakers split on the idea. Those supporting it included all Panhandle state representatives except for Rep. Kathy Sims, R-Coeur d’Alene, but just two senators, Sens. Steve Vick, R-Dalton Gardens, and Sheryl Nuxoll, R-Cottonwood, with all other Panhandle senators voting against the bill.

The change won’t affect the total amount of taxes collected. Instead, as homeowner’s exemptions shrink as a percentage of the home’s value for most North Idaho homes in future years, homeowners will pay more in taxes, while owners of other types of property, including rentals, vacation homes, commercial and industrial property, will pay that much less.