Idaho Lawmakers Introduce Bill to ‘Fix’ Property Tax Problems Created Last Year | Idaho

BOISE — A new bill introduced Thursday in the Idaho Legislature aims to restore property tax reduction benefits to some elderly and disabled Idahoans who are kicked out of the circuit breaker program.

Rep. Charlie Shepherd, R-Pollock, sponsored House Bill 481, which the House Revenue and Taxation Committee passed on Thursday.

The bill relates to the state circuit breaker program, which aims to reduce property taxes for elderly, disabled or widowed taxpayers.

If passed, the bill would increase the property value limit to 150% of the median home value in the county, or $300,000, whichever is greater. The current limit in Idaho law is 125%.

Shepherd said his new bill seeks to address a problem created last year when the Idaho Legislature passed House Bill 389. This bill created the 125% median value limit, which is expected to result in approximately 4,000 Idahoans no longer being eligible for the circuit breaker program in 2022, the Idaho Capital Sun previously reported. .

“If we do this, it will cost the state $1.1 million from our general fund,” Shepherd told lawmakers. “That sounds like a lot of money to me, but when we’re dealing with a $1.9 billion surplus and we’re going to spread that money across the state to help people, I think that (1.1 million dollars) is (a) acceptable expense to help some of the people who have lived in this state all their lives, paid taxes all their lives and all they want to do is hang on to their house that they bought and paid and now – no fault of theirs – are taxed.

The income limit for participation would remain at $31,900 per household or 185% of federal poverty guidelines.

In 2019, the median income of people participating in the circuit breaker program was $17,635, according to the State Tax Commission.

Introducing his new bill, Shepherd said the concept behind last year’s bill was to prevent “affluent people” from taking advantage of the circuit breaker scheme. But he said he has since learned that many elderly and disabled residents, many of whom are on low or fixed incomes, are losing their ability to use the circuit breaker.

As a result of last year’s new law, Shepherd said 91 residences in Shoshone County, which he represents, are no longer eligible for the property tax reduction program. He said passage of this new bill would restore eligibility to 81 of the 91 residents.

“What this relates to is the property tax cut which is basically trying to fix what I voted for last year that didn’t work as well as I had hoped,” Shepherd said during the hearing.

There was an element of bipartisan support for the bill during its introductory hearing on Thursday. Rep. Lauren Necochea, D-Boise, offered to introduce her.

“This is a very important step to fix a problem with what we did last year, removing seniors from property tax assistance,” Necochea told Shepherd during the interview. hearing. “I’d like to see the $300,000 inflation-adjusted level over time in the future, but I don’t want to mess with your bill.”

Some lawmakers asked Shepherd how he came up with the new eligibility limits of $300,000 and 150% of median value.

“Is it right?” Shepherd asked during the meeting. “I can’t define fair, and I don’t try to. I try to be reasonable.

The introduction of the bill clears the way for it to return to committee for a full public hearing.

Democrats promote alternative proposals but cannot be heard

Democratic legislative leaders called a virtual press conference Thursday afternoon to promote alternatives to cut taxes and invest some of the state’s projected $1.9 billion surplus.

They presented an alternative $600 million proposal that they say is more effective than House Bill 436, the $600 million income tax and tax refund bill. taxes that the Senate Local Government and Taxation Committee heard Thursday. The committee, on a party vote, sent the bill to the Senate with a recommendation for passage. If it passes the entire Senate, it will head to Governor Brad Little for consideration.

Democrats called for:

  • Repeal of the sales tax on groceries.
  • Restore the owner’s indexed exemption for property taxes.
  • $380 million in property tax cuts, including sending $250 million to school districts to pay school bonds and taxes and spending $100 million to distribute the balance of sales tax on Internet to local governments for facility purposes.
  • $20 million refundable child tax credit.

Democrats told reporters that some of the proposals have already been introduced as personal bills that will not advance this legislation.

“Time and time again, we’ve been shot on every single one of these proposals,” said House Minority Leader Ilana Rubel, D-Boise.

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