A handful of taxpayer-funded special interest groups are lobbying to kill legislation that proponents say will protect Idahoans from massive ambush property tax hikes.
The Idaho Association of Counties, the Association of Idaho Cities and the Idaho Association of Highway Districts, which are all funded by taxpayers, have declared war on House Bill 103, a measure that could prevent Idahoans from seeing large property tax hikes.
The bill addresses foregone balances held by local units of government. Idaho law allows cities, counties and others to hike taxes annually by up to three percent, plus they can add in new property growth and annexation. If officials don’t take all three percent, the percentage they don’t collect automatically stays on a government spreadsheet.
The uncollected amount represents each taxing district’s foregone balance. It’s not a savings account, per se, because the money isn’t banked. Instead, the government tracks the possible, but not collected, taxing authority of cities, counties, school districts and others.The sums not collected can accumulate over years and can be retroactively collected all at once, hence the notion of an ambush, whenever local officials decide it necessary.
House Bill 103, sponsored by House Majority Leader Mike Moyle, R-Star, would allow local governments to permanently eliminate some of their foregone balance. For example, one year a school district could take just one percent of the three-percent annual property tax hike allowed by law. Board members could then set aside one percent in the foregone balance account, and decide to “erase” the remaining one percent, so future boards could not retroactively grab it from taxpayers.
Pocatello Mayor Brian Blad, who presides over the Association of Idaho Cities, spoke against the HB 103 at a committee meeting earlier this week. Blad told House Revenue and Taxation Committee members he believes the bill will encourage local officials to take the maximum property tax increases allowed by Idaho law.
Blad also submitted a letter to committee members on behalf of AIC, as well as the counties and the highway district associations. The letter, obtained by IdahoReporter.com, echoes the comments he made at the committee meeting.
“If the law restricts local governments’ ability to recover foregone levies, then it incentivizes local units of government to levy the maximum 3% increase allowed by law,” the letter reads.
The letter took the criticism a step further.
“AIC, IAC and IAHD oppose House Bill 103 because it puts at risk the prudent budgeting and taxing decisions that local government officials have made over the decades,” the message says. “We should be rewarding local governments that budget conservatively, not looking to tie their hands with a short-sighted policy that increases the burdens on Idaho property taxpayers.”
Though the associations speak on behalf of hundreds of local government units, not all use conservative budget practices, which make this a moot point. For example, Blad’s Pocatello boasts a $1.7 million foregone balance, Boise City holds less than $14,000 in the forgone tracking sheet.
Of Idaho’s 191 cities, 84 hold no foregone balance. Another 51 cities have less than $5,000 in their foregone amounts.
Among Idaho’s 44 counties, 15 have no forgone balance. Another 5 counties have less than $500 in foregone amounts, including Jefferson County, which holds $1.
Organizations that depend on taxpayer dollars to exist, and which lobby against legislation that could protect taxpayers, is like the fox guarding the hen house. In this case, the Idaho Association of Counties is funded by $860,000 in dues from its member counties in 2014, according to the group’s most recent Internal Revenue Service filing. The Association of Idaho Cities took $512,000 in dues from cities and affiliate members, according to its 2014 IRS filing. The Idaho Association of Highway Districts collected $172,000 in dues from its members in 2014, according to the group’s IRS paperwork.
