BOISE — As Idaho homeowners’ concerns about rising property taxes have increased in recent years, the Idaho Legislature both last year and last year appointed a study committee of bipartisan and bi-House legislators to consider possible solutions.
However, the joint panel focused mainly on local government spending and recommended successful legislation and government investment to better track local government spending. She recommended nothing to change the increasing share of the property tax burden on homeowners relative to all other classes of real estate.
This year, the legislature did not formally appoint a committee. Rep. John Gannon, D-Boise, urges lawmakers to do so now.
“While paying close attention to the national inflation rate of 9.1%, the state pays no heed to the unfair, unjust and undeserved wealth tax inflation,” he said in a statement. “The legislature is way behind the curve. Most states have been remedial for years. A working group must be formed. We have to get to work.”
Senate President Pro Tem Chuck Winder, R-Boise, said Friday that there is an “informal working group of members of the House and Senate working on property tax issues, but it’s informal. We didn’t appoint it.” This informal group includes only Republicans—Rep. Mike Moyle, R-Star, and Sens. C. Scott Grow, R-Eagle, and Jim Rice, R-Caldwell.
Rice and Rep. Jim Addis, R-Coeur d’Alene, chaired the last committee of inquiry into property taxes, but both lost their reelection bids in the May primary.
Gannon said Friday that he had submitted his motion and at least one GOP legislative leader had expressed an interest, but he still had no official response.
Rice, Grow and Moyle met with Treasure Valley mayors and other local officials on June 30 to discuss property tax concerns and changes that would work for Idaho cities. While there, Grow said he has held meetings with stakeholders such as the Idaho Farm Bureau, the Idaho Association of Cities and the Idaho Association of Counties on the issue.
As reported in the Idaho Press, Grow told the gathering, “We’re trying to have a group that can actually make a difference and doesn’t get bogged down in as many ideas, conflicts and disagreements between the various groups as we are can do anything.”
Formally appointed interim legislative committees, task forces, and study committees must announce their meetings and follow the Idaho Open Meeting Law; This usually includes lawmakers from both parties and both houses. But Winder said that doesn’t apply to an informal group that hasn’t been appointed. “They wanted to try and work it out among themselves,” he said.
Gannon makes a suggestion he wants to consider to move to a five-year average for estimated taxable values to smooth out large jumps. His proposal provides that if the five-year average is greater than fair market value in the 5th year, the property is valued at fair market value.
Gannon said his idea is to deal with situations he sees both in his Boise district and across Idaho, where a house on a street is selling for, say, $150,000 more than any other house there is currently valued – and this leads to large valuation increases for all the rest of the houses, with accompanying tax increases. “It brings a fairness factor to our property tax system,” he said.
Gannon said he believes other ideas should also be considered and believes his proposal, coupled with an increase in the homeowner exemption, would largely solve the current problem.
In Ada County, residential real estate currently bears 80% of the property tax burden, compared to 20% for commercial real estate. It’s a trend that’s been accelerating for years as real estate values have soared but commercial and commercial property values have held steady.
In 2000, Ada County’s property tax burden split was 57% residential, 43% commercial, according to figures compiled by the Ada County Assessor’s Office.
Ada County Assessor Bob McQuade, a Republican leaving office after this year, has long supported indexing the homeowner’s exemption from changes in home values to address the issue. Currently, the homeowner’s property tax exemption is capped at $125,000. That’s just 23% of the current median estimate, McQuade said, although Idaho’s homeowner exemption had long been planned to exempt half the value of a home from property taxes.
“So there’s no doubt that it’s lost a lot of its value in real terms,” he said. “I’ve always found it very important that the homestead exemption be indexed.”
This exemption was indexed to home values until 2016, when the legislature removed the indexation and capped the exemption at $100,000. In 2021, lawmakers passed HB 389, which combined a series of changes including caps on local government budgets and tax breaks for businesses and developers, with an increase in the maximum homeowner exemption from $100,000 to $125,000, but did not restore indexation, just set a new cap.
McQuade said he was intrigued by Gannon’s idea of using a five-year average for valuations for all types of real estate. “That would really add a lot of predictability for both residential and commercial uses,” he said. “That’s an idea I think is worth exploring. … I’d really like to hear a robust discussion on this.”
As this year is an election year, little work has been done in interim legislative committees, working groups or study committees. The only two that have publicly announced and held meetings are the Committee on Federalism, which met June 7, and the Idaho Council on Indian Affairs, which met July 6. Though House and Senate GOP leaders announced in March that they would form a working group of senators and lawmakers to investigate allegations by House Republicans that Idaho libraries are providing explicit materials to minors that have not been appointed .
Winder said he has scheduled appointments for four workgroups but is waiting for house calls to be finalized for those, so none have met yet. The four are intended to address elections; health insurance for public school employees; how to better fund construction and capital improvements for schools in Idaho; and the composition of the Idaho Judicial Council.
The informal group that discusses property taxes isn’t one of them, Winder said. “They’re basically working on their own and we’re going to see how they fare over the next month or so and then decide what, if anything, we need to do,” he said.
Gannon said he was assured that “they will talk about it.”
“If there’s a serious issue that’s affecting the entire state — we’re seeing it in Idaho Falls, we’re seeing it in Boise, we’re seeing it in Kootenai County — lawmakers have to go to work and come up with solutions and bring everyone.” around the table, including taxpayers,” he said. “I think it’s a shame it’s an election year, but we still have work to do.”
A NAME CHANGE
The Idaho Federation of Families, an advocacy group for youth and families dealing with behavioral health issues in Idaho, has long held that name, but that’s changing now. “We’re trying to use the FY Idaho name — Families and Youth in Idaho,” said executive director Ruth York. The reason: Because the initials IFF, which the group has long used, are shared by the Idaho Freedom Foundation.
The Idaho Freedom Foundation is a right-wing lobbying and political group opposed to public education funding and is increasingly active in Idaho politics and campaigns through its various affiliated organizations. The group, which does not disclose its funding sources, says on its website that its mission is to “make Idaho a laboratory of freedom by exposing, defeating, and replacing the state’s socialist public policies.”
“I saw a headline this winter that said something outrageous that IFF did and my heart just stopped,” York said. “Then I realized, ‘Oh no, it’s just her again. We need to fix this!’”
The advocacy group for youth and family has now officially changed its name and is in the process of switching to a suitable new logo.