Idaho Legislature introduces new property tax bill as 2023 session enters late stages

A group of influential Republican Idaho legislators has combined elements of two separate property tax bills into one with hopes of addressing one of Idahoans’ top priorities before state legislators attempt to adjourn the 2023 session before the end of this month.

On Thursday, the Idaho Legislature’s House Revenue and Taxation Committee voted to introduce a new property tax bill that combines elements of House Bill 77 and House Bill 79, which were both introduced on Feb. 2 but had not advanced since then. 

The bill uses money from a variety of different sources, including a projected state budget surplus, the tax rebate fund, brick and mortar sales tax collections and online sales tax collections. It does several different things. 

• It takes a portion of the funding and applies it to a homeowner’s relief fund to apply a credit to the property tax bill that homeowners receive every year on their primary residence with a homeowner’s exemption.
• In the second year after taking effect, the bill would also apply a portion of the funding to reducing the bond and levy payments that local school districts have. That money would be divided between school districts based on their average daily attendance. 
• The bill would also eliminate the March election date that school districts can use to bring proposed bond issues and supplemental levies before voters. Those bonds and levy elections would instead need to be put forward during the May, August or November elections. 

Property taxes and housing affordability have been among the most important issues for Idahoans, according to a new Boise State University public policy survey. Gov Brad Little also made property tax reduction one of the major themes from his Jan. 9 State of the State address that opened the 2023 legislative session. 

Legislators introduced several property tax bills in early February, but those bills sat idle as negotiations continued behind the scenes at the Idaho State Capitol in Boise. 

For this new bill, House Speaker Mike Moyle, R-Star; Joint Finance-Appropriations Committee Co-Chairman Scott Grow, R-Eagle; House Revenue and Taxation Committee Chairman Jason Monks, R-Meridian; and Senate Local Government and Taxation Committee Chairman Doug Ricks, R-Rexburg, all worked on the new bill, Monks said. 

Monks told the Idaho Capital Sun on Thursday that legislators working on the new bill combined elements of House Bill 77 and House Bill 79 in hopes of getting the biggest bang for their buck and having the highest chance of passing the bill.

“It is definitely a compromise between the two (earlier bills),” Monks said in an interview. “I think we were wanting the maximum dollars that is available for property tax relief. Running them separately would run risks that one would pass and one would fail, and we wanted to work cooperatively together.”

Monks said combining the bills and having members of the Idaho House of Representatives and Idaho Senate work together increases the bill’s chances for passage. 

“I think we have done all that we can to make sure that the House and the Senate will be OK with the bill moving forward,” Monks told the Sun. “I can’t guarantee anybody’s vote, but I am confident we have a package that they can vote for.”

The new bill will be assigned a bill number and posted on the Idaho Legislature’s website once it is read across the desk on the floor of the Idaho House of Representatives later Thursday. 

Republican legislative leaders are pushing to adjourn the session March 24 — just over two weeks away — but their adjournment target is not binding, and the Joint Finance-Appropriations Committee still needs to finish setting the fiscal year 2024 budget and send those budget bills to the Idaho House and Idaho Senate for consideration.