Gov. Brad Little says he would likely sign a bill authorizing Idaho cities to impose a local option tax if it came to his desk.
Little’s comment at a Boise Metro Chamber of Commerce luncheon this week offers new hope to Treasure Valley political and business leaders, including the chamber, that they could finally get their long-sought authority to ask voters to subsidize a more robust transit system.
A sales-tax or fuel-tax increase have generally been thought to be the most likely forms that a local-option tax would take if enacted in the Treasure Valley. Little said such a tax must be regional, to avoid shifting sales from an area without the tax to a nearby area with it, as shoppers seek to dodge it. The tax also must minimize exemptions for certain products or services, he said.
“Any local option tax bill — and frankly, I don’t know that there’d be one that would get through the Legislature that I wouldn’t look at favorably — needs to minimize the fringe effect,” Little told a sold-out audience of about 400 people on Wednesday.
Little said he seeks a “comprehensive package” to ramp up Idaho’s spending on transportation, including possibly fuel-tax and registration-fee increases. Local-option taxing authority could be part of comprehensive legislation, he said.
Local option was considered by the Legislature when Little served there, as a state senator from Emmett from 2001 to 2009. Little said his objection then centered around proposed exemptions to the tax for items such as cars, heavy equipment and ATVs.
A local option tax could add a penny or another amount to a sales tax or fuel tax to pay for road improvements, public works projects or other purposes. Boise Mayor David Bieter would like money to pay for transit.
The tax would require voter approval. Little did not define what a region might consist of, but in the Treasure Valley, it might include Ada and Canyon counties. Based on recent elections, Ada voters might be more supportive of a tax increase than their Canyon counterparts.
Idaho law now allows only resort towns with populations of 10,000 or fewer to increase sales taxes. Fourteen cities, including McCall, Donnelly, Stanley, Ketchum, Driggs and Sandpoint, levy their own sales taxes.
To win approval, Little said, a bill would need to benefit small towns and rural communities that struggle to maintain their roads.
“To get that over the finish line, you’ve got to have the collective will of large swaths of Idaho,” he said.
Little said growth in the Treasure Valley and other areas of the state has added congestion and brought a need for added infrastructure.
“I always say the most precious commodity anyone has is their time,” he said. “As we’ve seen this city and all of the urban areas of the state grow, we know how that’s changed. People say it’s taking 10, 15, 20 minutes longer to get to work.”
Although people moving to Idaho from larger cities may be used to spending an hour or more commuting to work, that’s not acceptable here, Little said. “We’ve got to work on that,” he said.
Business Editor David Staats contributed.