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Senate Bill 1111 — Homeowner property tax relief

Senate Bill 1111 — Homeowner property tax relief

Parrish Miller
February 23, 2023

Bill Description: Senate Bill 1111 would dedicate General Fund surplus dollars and 4.5% of sales tax revenue to property tax relief for some homeowners. It would also allow more people to qualify for the circuit breaker property tax relief program.

Rating: 0

NOTE: Senate Bill 1111 includes provisions from Senate Bill 1075 and Senate Bill 1107, introduced earlier this session. 

Does it directly or indirectly create or increase any taxes, fees, or other assessments? Conversely, does it eliminate or reduce any taxes, fees, or other assessments?

Senate Bill 1111 would create Section 63-724, Idaho Code, "to provide property tax relief on owner-occupied properties in Idaho receiving the homestead property tax exemption."

Explicitly excluded from this relief are property taxes assessed for "bonds, school district levies, plant facility levies, and any voter-approved temporary levy for a specific duration."

The bill would fund this property tax relief in several ways. It would transfer $75 million "from the General Fund to the Homeowner Property Tax Relief Account," on July 1, 2023. 

Starting in FY 2024, 4.5% of Idaho's annual sales tax revenue would be allocated to the property tax relief program.

For Fiscal Years 2023, 2024, and 2025, up to $150 million or "the balance of the General Fund excess cash balance, whichever is less," would be transferred to the "Homeowner Property Tax Relief Account." Without this requirement, such money would ordinarily be transferred to the Budget Stabilization Fund.


Does it increase government spending (for objectionable purposes) or debt? Conversely, does it decrease government spending or debt?

Sales tax revenue (estimated at more than $2.3 billion for FY 2023) makes up a significant portion of the state's General Fund. By transferring 4.5% of the state's total sales tax revenue and up to $150 million in General Fund surplus dollars to property tax relief, Senate Bill 1111 reduces the amount of tax revenue available for expanding government. 


Does it increase government redistribution of wealth? Examples include the use of tax policy or other incentives to reward specific interest groups, businesses, politicians, or government employees with special favors or perks; transfer payments; and hiring additional government employees. Conversely, does it decrease government redistribution of wealth?

The property tax relief program created by Senate Bill 1111 would redirect hundreds of millions of dollars from the taxes paid by all Idahoans. The money would go to the subset of Idahoans who own single-family homes and receive the homestead property tax exemption. 

Reducing taxes is a good thing, but it is best done by giving proportionate tax relief to all Idaho taxpayers. By contrast, the approach in this bill provides disproportionate relief to some at the expense of others. 


Senate Bill 1111 would amend Section 63-705, Idaho Code, which deals with the property tax relief program, commonly known as the "circuit breaker." This bill makes two changes, increasing both the income and home value thresholds for the program. 

The income threshold is increased from $31,900 to $37,000, which is a 16% increase. The home value threshold is increased from 150% of "the median assessed valuation for all homes in the county receiving the homestead exemption" to 250% of this valuation. 

At its core, the "circuit breaker" is a redistributive program that allows a small number of homeowners to pay less in property taxes and correspondingly forces their neighbors to make up the difference. By increasing the income and home value thresholds for the program, Senate Bill 1111 would exacerbate this redistribution.


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