December marks the season of giving -- and the Idaho Department of Commerce joined the action in a big, expensive way.
This month, the state agency granted two new tax breaks for businesses that will bring jobs to Idaho, excusing millions in tax dollars for the lucky companies. Plus, the department announced a third tax giveaway it finalized in late October.
The agency inked the latest deal just days ago and has yet to formally announce it to the public. Identified only as Project Grand Slam, the project promises 186 new jobs in the Burley area. Those jobs, the agency says on its website, will average $44,200 in yearly pay, plus benefits.
The state predicts it will waive $5.86 million in sales, income and payrolls taxes through 15 years for the yet-to-be-announced business.
The deal would stand as the third-most lucrative break to date: Pocatello’s Amy’s Kitchen received a $6.7 million break in 2014 and last year, Paylocity, a human resources firm, drew a $6.5 million deal.
It’s unclear when the agency will announce Project Grand Slam’s details, which it approved at a Dec. 22 Economic Advisory Council Meeting. Megan Hill, the department's communication manager, declined to offer information, citing confidentiality agreements that prohibit further disclosure.
The Dept. of Commerce also handed out a tax break to leeds look listen, a residential audio company based in Ketchum.
The deal, announced Dec. 21, gives leeds a projected $1.37 million sales, income and payroll tax break for the 73 jobs it pledged to create. The agency said those jobs will pay an average of $62,000, plus benefits.
The company, which indicated it will launch operations in the tiny town of Carey, will enjoy the break for nine years.
Commerce Director Megan Ronk applauded the company in a press release.
“We are thrilled that leeds look listen is making a meaningful and significant investment in the rural town of Carey with their beautiful designs and innovative products,” Ronk wrote.
The third tax break announced by Commerce goes to Vie Active, a women’s activewear company founded in Australia. The deal, finalized on Oct. 27 but announced Dec. 1, will excuse up to $63,200 in total through a five-year span.
Vie Active will plant its flag in Ketchum and bring 43 new jobs to the town. Those jobs, the company said, will pay an average of $51,000 each.
Gov. Butch Otter served as that deal’s lead cheerleader.
“I’m pleased to welcome a new corporate citizen to Idaho, and I’m confident that the qualities that drew them here – our lifestyle, our scenic beauty, and most of all our people – will pay off for Vie Active, on the bottom line and beyond,” Otter said in a Dec. 1 statement.
The Department of Commerce has signed 32 similar deals since lawmakers created the program in 2014.
The tax-break program has its critics. Boise-based human resources firm Employers Resource sued the state over the program. The company alleged the Paylocity deal un-leveled the business playing field by giving Employers Resource an unfair economic advantage. A judge later dismissed the suit.
The agency may soon expand the program to allow more tax breaks to small companies. Legislation pre-filed ahead of the 2017 legislative session suggested the agency will ask lawmakers to allow giving breaks to small businesses that locate in towns of fewer than 5,000 people and will create at least 10 jobs.
The tax break program requires firms to create at least 20 jobs to qualify for special tax breaks.