A house for sale near the Boise Depot on March 20, 2021. (Otto Kitsinger for Idaho Capital Sun)
Within a matter of hours, members of the Idaho House of Representatives printed, heard and sent a property tax bill to the House floor that increases the homeowner’s exemption from $100,000 to $125,000.
It includes several other provisions that would provide tax relief to commercial property owners.
Rep. Mike Moyle, R-Star, introduced House Bill 389 in the House Ways and Means Committee at noon Monday, and it was considered within two hours in the House Revenue and Taxation Committee. Moyle said many organizations and individuals participated in the bill’s creation, including representatives from counties across the state, the Idaho Farm Bureau, the Idaho Association of Realtors and the Idaho Association of Commerce and Industry.
Moyle acknowledged several attempts at property tax relief that have failed in the Legislature since January, including a bill that failed by one vote in the Senate after concerns were raised by local elected and public safety officials. He told the committee the bill is meant to address several areas of property tax relief while curbing growth in local municipal budgets.
In addition to the increased homeowner’s exemption, the bill:
- Reduces property taxes for homeowners who qualify for the state’s circuit breaker program by increasing the benefit from $1,320 to $1,500 maximum.
- Increases the personal property exemption – which affects businesses – from $100,000 to $250,000.
- Exempts transient personal property from taxation, which applies to construction, logging and mining equipment that travels across the state.
- Creates an 8% cap on property tax increases that account for new growth in any budget year. By statute, each taxing district is allowed to increase its property tax budget by 3% in a given year, plus a budget amount for new growth.
- Delays a new construction project’s market value from being added to new growth calculations until after construction is completed.
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Several Canyon County public officials spoke against the bill, including Nampa Mayor Debbie Kling, her chief of staff Rick Hogaboam, county assessor Brian Stender and county controller Zach Wagoner. Kling criticized the speed of the process to pass the bill, while others criticized the details of the bill, particularly the amount of the increase to the homeowner’s exemption.
Rep. Tammy Nichols, R-Middleton, asked Stender who would benefit most from the bill in his opinion.
“Long term, I believe that the commercial industrial sector would benefit the most from this bill,” Stender said. “In the last three or four years, we have seen their overall tax burden be reduced due to the rapidly increasing home prices. With a capped (homeowner’s) exemption, it throws more of the taxable value into that residential category.”
Nichols motioned to send the bill for amendments because the homeowner’s exemption was not as high as she wanted to see.
“I don’t feel that in hearing the discussion that we are going to be doing what we need to do for the homeowners of our state, especially in these areas where we have robust growth taking place,” Nichols said. “And I am concerned that we are not going to be giving them the tax relief that they are in dire need of.”
Rep. Ben Adams, R-Nampa, supported that motion, saying $125,000 “is not going to cut it” for homeowners in his district. Chairman of the committee Rep. Steve Harris, R-Meridian, resisted the idea of amendments because he said it would effectively kill the bill as the Legislature looks to adjourn soon until at least September. The motion to amend failed on a voice vote.
Moyle defended the bill after Canyon County officials spoke, saying it was easier for local officials to blame the Legislature for property taxes increasing than to address the problem in their own annual budgets.
“You are better off in Ada County than Canyon County, and they are supposed to be more red than we are,” Moyle said. “Give me a break; the budget is out of control.”
But Wagoner said Canyon County has tried to take measures to control growth with little success because the exemption is no longer providing as much relief with rising home values.
“We heard the message last year. We did not take any 3% (property tax) increase,” Wagoner said. “We did not take any new construction increase. … We lowered our property tax budget. In spite of that, a majority of the Canyon County homeowners saw their Canyon County property taxes go up.”
Rep. Greg Chaney, R-Caldwell, has said he wouldn’t vote for a property tax bill that did not address the homeowner’s exemption. He told the Idaho Capital Sun on Monday that he has mixed feelings about the bill.
“The homeowner’s exemption piece doesn’t go nearly far enough, but it may be the best step forward we can make this year to grant some relief,” Chaney said.
The House could consider the bill for a full vote on Tuesday.
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