Tax Relief

Mayors, legislators who overturn items after tax breaks

The impact of Senate Bill 1108 on Idaho taxpayers simply depends on who you ask.

“1108 was a good bill,” Senator Mary Souza said on Friday. “It has hurt the rise in taxation of our citizens.”

The purpose of SB 1108 was to change the formula for property tax budgets to provide tax breaks for landowners. The bill died with one vote in the Senate, 18-17.

“The reason it didn’t work is because the cities were concerned,” said Souza.

In that respect she is absolutely correct.

“It was a bad bill that deserved to be beaten,” Coeur d’Alene Mayor Steve Widmyer told Coeur d’Alene Press. “It didn’t bring the promised relief.”

The bill originally called for 75 percent of the tax revenue for new buildings to be sent to cities. The other 25 percent would have gone to property owners in the form of property tax relief. Mayors from across the state turned to lawmakers, hoping, with whatever influence they could muster, to convince the senators to vote against SB 1108.

“It was totally ineffective legislation,” Post Falls Mayor Ron Jacobson told the press.

Jacobson’s argument in cracking down on the legislation comes from a cut in city budgets, which he said would cost taxpayers and essentially rob Peter to pay Paul.

“We are using growth tax revenue to pay the cost of growth,” he said. “As a result, we didn’t have to increase our Post Falls levy rate. But (the legislation) would limit that to 75 percent of the new growth.

“If we use 100 percent of that revenue and you take 25 percent away and you have the same budget and needs, who is going to pay for that shortfall? The existing taxpayers.”

Jacobson said mayors banged their fists on their tables for months to alert lawmakers, but their efforts “fell on deaf ears”.

Widmyer agreed.

“We have had talks with the legislature since before the end of the last session,” he said. “We have said many times that the problem is a flawed valuation model and the government has not addressed it properly. But if people want new growth to pay for itself, don’t limit how much revenue you can get from that growth. “

Jacobson agrees with Widmyer’s assessment of the flawed model, but added that the county assessors should not be responsible for models that are beyond their control.

“I think we need to review the evaluation methods used,” he said. “This is not a criticism of the assessor’s office. But we have to check that. We need to look at the homeowner’s liberation. It has not been updated for several years. I think we need to look at the breaker and the senior options. “

But if SB 1108 isn’t the tax break solution, what is it?

“I wish I did,” said Jacobson. “We sent information to both the House and the Senate, we sat down and visited them in person, and yet they fell on deaf ears. We are more than happy to provide them with information, but if they ignore it I really don’t know what the next step would be. “

Whatever comes next, Souza, Widmyer and Jacobson agreed that it would take more than one step on the road to tax relief.

“There will be a tax bill in the house to give tax breaks,” Souza predicted. “That could lead to a certain income tax relief. We could see some kind of direct credit being sent to taxpayers. There is no solution to this problem. There are a lot of moving parts … but SB 1110 would have done some good things. It was a start, a good first step. “

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