Variable property tax reduction plan introduced in house committee
A new bill proposed in the House Revenue and Taxation Committee Thursday would deliver at least $500 million in property tax relief to Idaho residents in its first three years.
Republican Representative Jason Monks (R-Meridian) presented the legislation, a combination of two previously introduced bills that stalled in committee.
House Bill 292 gives a tax credit to anyone claiming a homeowner’s exemption on their taxes. It also offers funding for school districts across the state to pay down bonds and levies to reduce property tax burdens for any taxpayer.
Funding will come from multiple existing sources, Monks explained, including the state surplus, tax rebate fund, a portion of sales tax income and one-time monies available this year.
Money from the ‘surplus eliminator fund’ has been used in recent years to pay for transportation-related spending, as well as propping up the state’s budget stabilization fund.
The total amount available for tax relief could vary widely from year to year because of the plan’s reliance on the state’s projected - but not guaranteed - surplus funds.
“Over the three years, you’re looking at about upwards of $960 million, if all goes well,” Monks said. “Worst-case scenario, you’ll be over $500 million.”
The plan adds sales tax revenue from online purchases into the equation starting in 2025.
About $100 million in the first year would go to school districts, required to be used to pay down first bonds, then levies. Unused funds could be saved for future construction costs. The bulk, as Monks described, would be issued as tax credits.
The bill also makes the state’s property tax circuit breaker, a tax cap for low-income residents, easier to qualify for and expands how much of an assessed home’s value is covered under the program.
Monks said the new bill, a combination of two previous bills which stalled after being introduced in committee, was assembled by a team that included Senators Scott Grow (R-Eagle), Doug Ricks (R-Rexburg) and House Speaker Mike Moyle (R-Star).
At an Idaho Press Club forum on Wednesday, Moyle explained why property tax legislation is coming in so late in the session.
“We all sit around and spin our wheels and everybody wants something, but you get to a point where you hit critical mass,” Moyle said. “And what’s the old saying, ‘it’s soup now’? It's time to get it done and we’ll move.”
Rep. Ned Burns (D-Belleuve) took issue with language in the proposed legislation removing the March election date for school funding ballot issues.
“The school districts need this election to make sure that they can properly negotiate with teachers the contacts they need to,” Burns said. His substitute motion to introduce the bill but keep both March and August election dates as options for schools failed on a party-line vote.
A motion by Rep. Charlie Shepherd (R-Pollock) to print the bill as presented passed unanimously. The committee is expected to take up the bill early next week.