January 27, 2020
- Trevor Chadwick
- Gheen Christoffersen
- Tom Dale
- John Evans
- Lauren McLean
- Garret Nancolas
- Jason Pierce
- Steve Rule
- Robert Simison
- Joe Stear
Staff and Guests
- Mayor Rich Sykes – Mountain Home
- Bill Larsen - TVP
Welcome and Introductions
Mayor Joe Stear welcomed everyone to the City of Kuna.
After introductions he mentioned that today’s lunch is being prepared by Life’s Kitchen. They help troubled youth, and this gives them and opportunity at a career in culinary arts. They have been using them for various events around Kuna.
Hands Free Driving
There are two bills in front of the legislature on this topic. One out of the Senate, authored by Senator Winder, S1250, and one out of the House introduced by Representative Palmer, H0308. The Idaho Police Chiefs Assn. at this point in time is endorsing the Winder Bill, S1250. The Palmer Bill at this point is too broad.
We anticipate there will be a bill that coalesces regarding driving while holding a hand-held device.
The hottest topic at the legislature is Property Tax. He found out this am that Representative Collins is introducing the Property Tax Freeze Bill on January 28, H0355. This Bill would freeze property tax revenues to their current hard dollar level for next year. That means no 3%, no new growth, no annexations.
One thing that is disturbing at this point is the Senate Tax Committee Chair is also endorsing H0355.
He is getting together with Tom Healey, with the department of commerce.
In a conversation with one of the legislators in regard to this property tax freeze, His view is, we are required to evaluate new applications as they come in. Whether it is reviewing sewer applications for capacity, ensuring fire plug access, roadway infrastructure needs, etc. These are but a few of the many considerations we have. The load that hits him the hardest is the public-safety load.
In his discussion with Representative Moyle, he mentioned if we have a hard dollar freeze, we have to look at this in the context of people constantly coming to him as Mayor, that we have to do something about growth and that growth has to pay for itself. Do we accept a new application that is going to add loading without any corresponding revenue, thereby lowering level of service to existing folks?
His position is that he doesn’t want to add loading that compromises his level of service now. For example, if he has a fire response standard that says 5 minutes and by taking on this new project the standard goes to 5.5 or 6 minutes. That is not a hold harmeless for service level.
The impacts of a freeze to us as community leaders would be two-fold. In the short-term, people would be hailing him for slowing growth down. On the long term it could impact the ability to provide housing, etc. People coming in would be nervous seeing that there are freezes, which would have a chilling effect on commerce.
We need mayors/commissioners to come down to the legislature and testify. He wants you to come with an example of what modifications you would make to current operations if you could not count on any additional property tax revenue for next year.
Mayor John Evans email@example.com 208-472-2916 – Office 208-949-7422 - Cell
He has asked Justin with AIC to come up with a real number of what the percentage of total revenues are property tax revenues, for cities. In Garden City, property taxes comprise 45% of their general fund revenue. We all need to know these percentages. We also need to know the revenue we can spend for general fund things and revenue you cannot.
He has had conversations with legislators and has relayed the fact that all things are not equal as they have contracts with Unions for example. Additionally, there are always increases in health insurance cost and other things.
If you cannot make it to testify to the legislature over these property tax issues, especially the freezes, please call, email or text ideas he can relay as to how these actions would affect your city/county.
What we need to do is, take a look at the impacts of a freeze. We need to get with our staff and others to identify what the effects would be. In Kuna, they have been working on bringing their police services up to par. Each year as they look at roughly 10% growth, this means the police services need to grow the same. They have been going along with a stable staff, but once in a while, planning and zoning for example will need to hire a person to keep up with the increased workload.
If they don’t have the increase in funds that come with the growth, they can’t do that.
He encouraged members talk with staff, public works, treasurers and others and put together what it would mean to you as a city/county. We need to have the ammunition to go to the legislature why these tax freezes are a bad idea. He encouraged everyone to contact John with ideas/questions.
The year’s first RS hearing of the House Rev & Tax Committee gives you a flavor of the legislature this year. There were four bills introduced. One was to freeze property tax. One was to cap at 3% and never get new growth or annexation. Another was to get rid of foregone.
This is the flavor this year. He has heard that there will be several waves of legislation over property and sales tax issues.
Hopefully we can curb this for a year. If they want to convene a committee to talk about reform.
We talked about this in the IAC Legislative Committee meeting the prior week. Everybody agrees this is a killer. It is more of a killer for smaller counties and cities.
He thinks it is going to take the joint effort of cities, counties, school districts and others to really get this issue to go away.
He thinks this freeze will fly through the house. Yes, we do need to make a presence and making statements to the house is important. We need to concentrate on the Senate side. If you have relationships with your Senator, that is where you need to go.
In re: additional legislative activity, Speaker Bedke wants to promote a flat 4% year-over-year increase of property tax with no new construction. Rep. Collins wants to do the same thing but cap it at 3% every year.
The thing of it is, it is cyclical. If you look at 2004 they raised the home-owner exemption. All this was, was a tax shift in response to the unprecedented growth happening in the valley. Fast forward to 2007. In Caldwell, hey lost 1/3 of their assessed value in the City. We didn’t recover from that till about 2015 where we got our general fund revenue back to where it was in 2008.
Here again we have this reaction to what is going on with growth. Give it a chance, it is not going to stay this way forever. Something will happen and we will see a down-turn.
The discussion shouldn’t be, should we take away foregone or what ever else. It should be, lets have a comprehensive look at taxes in general. The State’s and Cities that recovered the fastest from the 2008 down-turn, were those that had more than one revenue source. Those that had a wide variety of tax revenue sources, were the ones that recovered the quickest.
Tom The other part of this discussion is the balance of who pays the property tax. There was a recent chart from Ada County that showed a 10-15 year comparison of the percentage of total property tax burden of residential vs. commercial/industrial payors. The residential % of total property tax burden used to be closer to 50%. Over the last 10 years it shows that the residential burden has risen to roughly 70%.
Before we wrap up on this topic, any information the members can give him on the impacts a freeze in property tax would cause would be extremely helpful.
What happens to us, is we get one day’s notice on anything that happens in committee at the legislature. As a result, only the local Mayor’s/Commissioners can even have a realistic opportunity to be present and testify when the time arises. Mayor Casper from I.F. can’t just fly over on a moment’s notice.
We are starting to see some headway on the binding arbitration issue. People are starting to recognize that would create a situation where an outside third party would be dictating what a component of your budget is supposed to be. Garret has been on top of this.
We will be seeing a whistle-blower cap piece of legislation this year.
He believes there will be 5-6 more property tax pieces of legislation coming this session.
They are a nonprofit organization founded in 2003. Their main goal is to serve at-risk youth, ages 16-20. They try to give them skills to be successful. It is a 16-week program. They teach them culinary/food service skills where they can get food handling certificates. They also will provide GED training, and training in life skills like budgeting. They also do job placement services for program participants.
Bill indicated the TVP tax return was done and it would be available for those that want to see it.
Included in the packet is the 4th quarter SAUSA Report as well as the projected State Savings report.
The City of Middleton will be hosting the February 24th meeting.