Road materials sales tax break draws much debate in House
Sen. Jim Rice’s bill, HB 95, to exempt materials for public roads from the sales tax, as a way to indirectly try to get more money routed to road maintenance by lowering private contractors’ bids, is drawing much debate in the House today.
“This appears to remove $20 million out of my revenue stream,” House Appropriations Chairwoman Maxine Bell, R-Jerome, told the House. “As a person who always irrigated with my husband, you can’t keep diverting and diverting ... somebody’s going to dry up at the end of the row. This is also a tax break to one group of people. If you want to do a tax break, let’s spread it around.” She added, “Please do not take a gamble. The roads really need revenue, but I cannot tell you and I don’t think you can that this will be a straight across to the roads, that it will be that much . Perhaps some will say I can do a better bid now and I will transfer that to the roads. Do it cleaner than that. This is a little squishy – that’s a term in budgeting. … Help us get to the end of the row. … Please stay with those who are working on cleaner way to fund roads and let us work with you and make sure we do the best we can for those things we’re responsible for, with the revenue stream we assume we’ll have.”
Rep. Reed DeMordaunt, R-Eagle, said, “What concerns me about this is the precedent we’re setting here. If it’s a state project, they’re tax exempt. But what we’re now doing is we’re extending this to a third party. That’s a pretty dangerous precedent.” He noted that the state has many contractors, like Health & Welfare vendors, and their computers and other materials aren’t tax-exempt.
Rep. John Rusche, D-Lewiston, called the bill “sleight of hand, moving money out of the general fund and not really acquiring the revenue that we really need to have.”
House Transportation Chairman Joe Palmer, R-Meridian, said the money raised from sales taxes on road materials shouldn’t be going to the general fund, it should go to the dedicated funds for roads. “I absolutely believe that we’ve been directing them inappropriately,” he said.
House GOP Caucus Chairman John Vander Woude said, “I think it’s a good step forward. It doesn’t solve the problem, I think we’re still going to be working on solutions, but I think this is at least a step in the right direction.”
"These are not properly general fund revenues," said Rep. Greg Chaney, R-Caldwell.
