Business

Idaho business groups tally wins, losses for 2015 legislative session

The Idaho Department of Commerce would have loved for the 2015 Legislature to cut taxes while finding millions more for education and the state’s out-of-repair transportation system. The same goes for the Boise Metro Chamber of Commerce, which would have also liked to see lawmakers expand Medicaid.

But with a bow freshly tied on the 2015 session, representatives from both groups applauded lawmakers for increasing road and bridge funding by nearly $100 million per year and boosting education spending by 7.4 percent.

“We’re quick to acknowledge tax relief will be important for Idaho at some point,” said Jeff Sayer, Department of Commerce director. “Right now, making these investments in our workforce and infrastructure are far superior to any tax relief.”

Caroline Merritt, a chamber lobbyist and spokeswoman, said the state eventually needs to find money to square the $262 million in additional funding needed just to maintain Idaho’s existing transportation system. But getting a chunk of that was vital, she said, especially when it appeared the House and Senate might not find common ground on the issue. The Legislature raised the gas tax by 7 cents and increased driver fees.

“I don’t know if any groups realistically expected to come away with $262 million for transportation this year,” Merritt said. “We recognized the state has many needs, including education, a huge one that we support. We’re pleased they did something significant.”

The Legislature continued implementing the recommendations of Gov. Butch Otter’s 2013 Task Force for Improving Education by allocating an additional $125.5 million to create a teacher salary ladder. Lawmakers hope the pay raises will stem the tide of Idaho teachers leaving the state for better paying positions elsewhere.

When the new pay structure is fully implemented in the 2019-2020 school year, teachers in their first three years will earn between $37,000 to $39,000 per year. Teachers with more than three years of experience will earn between $42,500 and $50,000 per year.

“Investing in our workforce and in our infrastructure was unequivocably the most important thing Idaho can focus on right now,” Sayer said.

A business voice for Medicaid reform was weakened after an offensive email from Alex LaBeau, president of the Idaho Association of Commerce and Industry, leaked. IACI placed LaBeau was placed on temporary leave. IACI did not return a call Monday seeking comment on the session.

OTHER WINS

A bill creating “benefit corporation” business status sailed through both houses with support of the department of commerce. The new status will give a legal foothold for corporations wanting to to pursue goals such as working for charitable, environmental or social causes in addition to maximizing profits.

The chamber supported the so-called “Uber bill” that prohibits cities from regulating ride-hailing companies such as Uber and Lyft. Uber stopped operating in Boise after the city proposed rules that the company said were too onerous. The bill was introduced mid-session. Otter let it become law without his signature.

Both the commerce department and the chamber were prepared to defend the Tax Reimbursement Incentive that became law in 2014. The law created a tax break worth up to 30 percent of income, payroll and sales tax for companies meeting thresholds for job creation and wage level. No challenge emerged.

“We were wondering if there would be any efforts to chip away at it,” Merritt said. “We don’t want to take anything for granted.”

LOSSES

Bills that would have reduced Idaho’s personal and corporate income tax rates and reduced or killed what remains of the personal property tax — a tax on business equipment — died on the vine.

Merritt said she was surprised that no proposal to at least increase the personal property tax exemption received serious consideration. The commerce department and the chamber supported also reducing Idaho’s corporate income tax. “To not get any tax reduction this year was disappointing,” Merritt said. “But the state has many pressing needs. We understand why we didn’t get it.”

The chamber didn’t get any traction while pursuing two longstanding goals: expanding Medicaid and creating a local option tax. Neither was surprising, Merritt said.

“We’re hoping with advancements in other states will inspire the Legislature to take another look,” Merritt said. “But we’re realistic, and we realize a lot of them won’t go for it.”

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