Special committee clears $95 million tax hike plan, no cuts in sight

Special committee clears $95 million tax hike plan, no cuts in sight

by
Dustin Hurst
April 10, 2015
Dustin Hurst
Author Image
April 10, 2015

A special committee forced into a hearing room for several hours the past two days approved Friday afternoon a plan to raise taxes on Idahoans by $95 million a year.

The plan, the final piece of the 2015 legislative session, raises gas taxes by 7 cents a gallon, adds $21 to annual car registration fees and $25 for heavy trucks and tacks on extra costs for hybrid and electric cars.

The panel, consisting of three lawmakers from each legislative body, supported the plan unanimously.

In all, the package will raise $95 million, including $63 million through gas taxes and $28 million from registration fees on cars and light trucks. Heavy trucks will add $3.7 million through fee increases.

The final plan lacks any tax cuts, although such cuts were an important stipulation originally demanded by two of the three House members during negotiations Thursday.

If the plan clears the Senate and House and wins Gov. Butch Otter’s support, the full 7-cent gas tax hike would take effect July 1. Lawmakers had debated a phased-in hike, but that was absent from the plan. House Majority Caucus Chair John Vander Woude, R-Nampa, said the immediate increase would add $60 million more for roads than the phase-in through the next five years

The plan would also split the new revenue between local highway districts and the Idaho Transportation Department. The state would get 60 percent of yearly income and the districts would get the rest.

Vander Woude said the plan isn't perfect, but represents some progress. “I think this has been a difficult process and a tedious process at times,” Vander Woude said. “But I think we've moved the ball forward here.”

Rep. Mat Erpelding, D-Boise, complained lawmakers didn't raise taxes even more to address the $262 million road repair funding gap. He and Sen. Roy Lacey, D-Pocatello, suggested the Legislature is kicking the can down the road, but added that something is better than nothing.

Sen. Bert Brackett, R-Rogerson, and Sen. Dean Cameron, R-Rupert, both said the lawmakers will eventually have to find more funding in the future. “I would be the first to admit we still have the work to do,” Brackett said.

The vote ends weeks of political wrangling by House and Senate leaders. The House first lined up behind a plan to raise the gas tax 7 cents a gallon, but that plan died because the Senate objected to the inclusion of income tax cuts and elimination of the grocery tax.

The Senate plan, $127 million in gas tax and fee hikes with no reductions, was soundly defeated on a 17 to zero vote in the House Transportation and Defense Committee, spurring the special conference committee.

The bill must now wind its way through the House and Senate before lawmakers end their work for the year.

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