Senate panel kills bill expanding property tax breaks for business expansions
After hearing testimony both for and against, the Senate Local Government & Taxation Committee has killed HB 286, the bill to expand a program that allows county commissioners to give property tax breaks for business expansions, on a 5-4 vote. The bill, HB 286, was sponsored by Idaho Commerce Director Jeff Sayer and House Majority Leader Mike Moyle; it would have expanded the current property tax break that county commissioners can give out for new manufacturing plants that involve investment of $3 million or more, and made it available for any “non-retail commercial or industrial project” in which $500,000 or more is being invested. Property taxes could be waived for up to five years.
Sen. Jim Guthrie, R-McCammon, who made the motion to kill the bill, said, “This is an awful big leap to take in one jump.” Sen. Cliff Bayer, R-Boise, said, “I don’t like trusting the Legislature with that kind of discretion, quite frankly,” let alone county commissioners. “I’m not sure about putting people in the position of picking and choosing.” He said businesses could end up at an unfair disadvantage to a competitor as a result. Sen. Jim Rice, R-Caldwell, said “I’d be more comfortable if this provided for a public hearing with the notices to the other entities.”
House State Affairs Chairman Tom Loertscher, R-Iona, told the senators he voted for the bill in the House, but now wishes he could take that back and vote no. He said as a former county commissioner, he’s seeing more and more entities get tax exemptions, and he fears that shifts the burden for paying for county services to the rest of the taxpayers.
Dan Blocksom of the Idaho Association of Counties spoke in favor of the bill, noting that it would be up to the elected county commissioners to decide on the tax breaks. “If taxpayers thing that the county commissioners are giving away the store, they have a recourse,” he said. Several county commissioners, mayors, city officials and chamber of commerce representatives also spoke in favor of the bill.
“This helps the little guys,” Sayer told the Committee. “This also loosens the reins. It’s based on trust.” Local county commissioners are trusted to use the tax break appropriately, he said, for those “who are making jobs and growing the economy and not just looking for a tax break.”
The committee was split in 4-4 tie, with Sens. Rice, Vick, Bayer and Guthrie supporting Guthrie’s motion, and Sens. Johnson, McKenzie, Stennett and Burgoyne opposed; Chairman Jeff Siddoway then broke the tie, voting yes and killing the bill.
