GOVERNOR RISCH SIGNS PROPERTY TAX
RELIEF LEGISLATION

BOISE – Six days after two-thirds of the Idaho House and Senate voted in favor of House Bill 1, Governor Jim Risch signed the legislation into law, reducing property taxes by 20 percent across the state.  The House had approved the bill on a 47-23 vote and the Senate passed it with a 24-11 margin.

During the signing ceremony in the Governor’s office, Risch said it was a satisfying victory to provide property tax relief while protecting education.  “This is a very historic day for Idaho as we reform the way property taxes are collected while permanently reducing property taxes by 20 percent.  At the same time we are collecting revenue from an equally strong source to protect our public school funding,” said Risch.

“It is also very satisfying to see the Legislature place $100 million into a rainy day savings account for education.  If Idaho’s economy hits a rough spot this funding can be used to keep school budgets whole.  Idaho legislators care deeply about properly funding our public schools and they knew this was the right thing to do,” the Governor said.

House Bill 1 permanently eliminates the 3-mil education maintenance and operation levy on real property.  That is $3 for every $1,000 of assessed value, which is not capped like other local government levies found on property tax bills.  Thus, the change will stop the wildly escalating increases in property taxes.  The removal of the levy reduces property taxes by $260 million statewide.

The sales tax would be raised on October 1 from 5% to 6% to protect education, and generates $210 million.  The governor’s proposal is to use $50 million from the surplus to keep education funding whole, and places another $100 million of surplus funds into the Public Education Stabilization Fund.  That $100 million “rainy day” savings account could be tapped for public schools in the event of a funding shortfall in an economic downturn.

The legislation also requires an advisory vote in November, asking voters if they want to keep the property tax relief just adopted and to keep the sales tax at 6% to protect education. 

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