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Gov. Otter frustrated after Idaho Legislature rejects gas tax, stimulus plans

After meeting rejection on his gas tax and stimulus plans, the governor says he's got options but is staying mum.

BY BRIAN MURPHY - bmurphy@idahostatesman.com

Published: 04/10/09


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Shawn Raecke / Idaho Statesman
Rep. Raul Labrador, R-Eagle, debates the 2-cent gasoline tax increase on Thursday in the House. "How can anybody say we are being irresponsible when every other department is being cut and (the Idaho Transportation Department) is getting more revenue?" Labrador said in an interview after he voted no on the measure.

ADDITIONAL INFORMATION

Irresponsible? Not us, House conservatives say

By Cynthia Sewell • csewell@idahostatesman.com

And it’s not only the rough economy that prompts them to oppose Gov. Butch Otter’s transportation-spending increases. They think the Idaho Transportation Department is already getting enough money.

This session lawmakers are considering appropriating $508 million, more than the department got last year, even though other agencies’ budgets are being cut, said Rep. Raul Labrador, R-Eagle.

“They also will get $182 million in (federal) stimulus money and an additional $15 million in discretionary stimulus money,” he said.

ITD also has more than $300 million in unspent bond money, has found $36 million in savings this past year and is slated to receive $82 million in new bond money this year, Labrador told lawmakers Thursday before they rejected a 2-cent gasoline-tax boost.

House Transportation Committee Chairwoman JoAn Wood, R-Rigby, still insists support is not there to raise gasoline taxes or vehicle fees this session.

But her Senate counterpart, Republican John McGee of Caldwell, predicts Otter will emerge from the session with “meaningful” road money.

“This is not the end of the discussion,” McGee told the Idaho Statesman.

The Senate might try to add that money to bills the House has already passed, such as one to eliminate the gas tax exemption for ethanol. Wood and other lawmakers say that would go nowhere in the House.

Meanwhile, three bills to increase vehicle registration fees are sitting in Wood’s committee (House Bills 254, 149 and 148). Wood said one of those likely will go to the full House but will face even stiffer opposition than the gas tax.

Other bills would provide ITD money:

$82 million: SB 1186 authorizes ITD to sell more bonds to pay for continued repairs to Interstate 84 between Boise and Nampa and design work on Idaho 16. Approved by Senate, this bill faces a House vote Friday.

$12 million to $17 million: HB 96 eliminates the ethanol exemption. It passed the House and awaits action from the Senate Transportation Committee.

$13.1 million: SB 1087 increases license, title and other motor vehicle service fees. It, too, awaits action in the committee.

Cynthia Sewell: 377-6428

Stay tuned. The 2009 legislative session might just make it into May sweeps after all.

"Frustration is probably the best way to explain the emotion that I'm having right now," Gov. Butch Otter told the Idaho Statesman during an interview in his office Thursday afternoon.

No wonder.

On Thursday alone, various parts of the Legislature rejected some of his plans on transportation funding, and on spending federal stimulus money.

The first-term governor was evasive when discussing what he would do to deal with the Legislature. In 2005, his predecessor, Dirk Kempthorne, vetoed eight bills in one day and threatened more if the House did not consider his Connecting Idaho bill, which authorized borrowing to build highways. Kempthorne's game of chicken worked.

"All you've got to do is look back, if you've got any historical memory," Otter said. "There's lots of things the governor can do."

He has been unable all session topersuade enough members of the House to pass an increase to the 25-cent-per-gallon state tax on gasoline.

Otter's original plan - a 10-cent increase over the next five years - never made it to a floor vote.

His proposal for a 7-cent increase didn't pass the House. Nor did increases of 5 cents, 4 cents, or 4 cents over two years. Thursday, a 2-cent increase failed too, 37-32.

Otter quickly responded.

"Instead of working in the best interest of Idaho, 37 members of the House continue finding new excuses to do nothing. That is irresponsible," Otter said in a statement released shortly after the vote.

The 37 no votes came from 23 Republicans and 14 Democrats. All four Republican House leaders voted for the measure.

Otter had higher hopes for the 2009 Legislature.

After failing in his 2008 bid to get transportation money, Otter conducted seven meetings across the state and spoke to more than 1,000 citizens before putting together a transportation package.

It included increasing registration fees and fees for specialty plates, taxing rental cars, removing the tax exemption for ethanol, and shifting funding for the Idaho State Police.

"I feel strongly about the issue," he told the Statesman on Thursday. "I think we have made a case in answering all of the questions, all of the doubts. This has been well over two years now. ...

"We've answered all the questions. We've modified our positions. We've done everything we possibly can to convince at least the House."

That transportation plan isn't the only source of disagreement with the governor. He wanted to use $26.8 million from the federal stimulus bill for six major road rehabilitation projects picked by the Idaho Transportation Department.

Instead, the Joint Finance-Appropriations Committee on Thursday siphoned some of that money to reduce state payroll cuts ($7.4 million) and pay for an aquifer management plan ($2 million). Then it allocated the remaining $17.4 million to local highway districts, counties and cities that have complained they've been left out of the process.

"Completely unacceptable," said Clete Edmunson, the governor's transportation chief.

Edmunson said local road districts already are getting a higher percentage of the stimulus money than they normally get from federal dollars.

Dividing $17.4 million among 33 counties, 64 highway districts and 192 cities would not be enough to do significant projects and would create a nightmare reporting to the federal government, he said.

And then there are those payroll cuts.

Jason Kreizenbeck, Otter's chief of staff, sent an e-mail Thursday to the House and Senate leaders of both parties and the Joint Finance-Appropriations Committee outlining Otter's position on payroll cuts in response to sagging revenues. That position conflicts with what JFAC passed earlier this week - and with the governor's plan last week as e-mailed to lawmakers by another aide.

Kreizenbeck said Otter supports keeping payroll cuts at 5 percent and wants the flexibility to restore 2 percent if the economy stabilizes.

"The governor's position has never changed, despite what the media has indicated," he wrote.

Last week's e-mail from Budget Director Wayne Hammon said Otter's plan "decreases the (payroll cost) reduction from É 5 percent to 3 percent."

JFAC voted not only to reduce the cuts from 5 percent to 3 percent immediately, but to do it by using stimulus money - something Otter also opposes.

So what is Otter going to do?

"I'm not going to talk about that," Otter said.

In other words, stay tuned.

Brian Murphy: 377-6444

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