Otter on other issues the 2013 Legislature faces

On whether he’ll ask legislators for a state health exchange:

By Dec. 14, Otter has to tell the federal government whether Idaho will operate its own exchange, do so in partnership with the federal government or leave the job to the feds. Otter will meet with newly elected legislative leaders Friday afternoon to discuss the issue.

Proponents of a state exchange, which include Idaho’s big insurers and employers, may be heartened to hear Otter’s civics lesson after failed efforts to overturn Obamacare in the courts and at the ballot box.

“I want to remind you, we are a republic,” he said. “And one of the first and most important tenets of the republic is the rule of law. So, like it or not, we’ve tried to change the law, we’ve challenged the law, we’ve done everything we possibly could.

“And now we have to make the decision and that decision will come down. It’s not going to please everybody, I’m sure. Those of us that have to make the decision probably won’t be pleased about it.”

Opponents may be pleased to hear Otter’s criticism of the U.S. Department of Health and Human Services for changing the rules for implementation. “It’s kind of been on the installment plan,” Otter complained.

“Every time we think we’re at a point where we’re ready to make a decision on it, then we get another set of rules and regulations that changes the dynamic of what we thought we were dealing with when we were going through the investigation and the hearings on whether or not we ought to establish a state insurance exchange.”

On whether Otter will urge legislators to accept federal incentives to expand Medicaid:

He said he hasn’t gotten solid answers from governors who have opted to add more low-income beneficiaries to the health plan. It’s heavily subsidized by the feds but still costs states hundreds of millions annually.

At first, the feds will pick up all the cost of the expansion, later dropping to 90 percent. Expansion would add an estimated 80,000 recipients to about 238,000 Idahoans already on the plan.

Otter said he’s concerned about the financing. “One of the most intriguing and inviting reasons for the expansion is it’s all paid for. The next question is how are they going to get the money?”

Otter then said he fears continuing growth of federal power. “I’ve often wondered what a second Jimmy Carter term would look like,” referring to the Democratic president defeated by Ronald Reagan in 1980. “I think we’re going to find out. I think that probably the next four years are going to see a dramatic and continued expansion of not only the federal government, but a consequential reduction of the powers and authorities (of the states). It’s not something I’m looking forward to, but I signed onto the job.”

On his support for repealing the personal property tax, which raises about $130 million a year for local governments:

Otter cautioned that state revenue projections have been scaled back since the 2012 legislative session. Projected growth in fiscal 2013, which ends in June, has been cut from 3 percent to 2.7 percent, he said. Projected growth in fiscal 2014 has been scaled back from 5.9 percent to 5.2 percent.

That makes backfilling $130 million in lost property taxes to local government difficult, Otter said. “We do not have a placeholder for $130 million in that budget,” adding that repeal may have to be phased in.