Idaho OKs new expenses for school choice tax credit

BOISE — State budget writers on Tuesday approved seven additional full-time staff for the Idaho Tax Commission to handle the extra work related to the newly passed school choice tax credit.

The new positions would cost $550,000, which would come out of the $50 million that had been associated with House Bill 93 — this cost had not initially been anticipated when lawmakers voted on the legislation. The Joint Finance and Appropriations Committee (JFAC) voted 17-2, with one absent, to pass the enhancement budget for the tax commission.

“We put the best information we had on the fiscal note in the House when we ran that,” committee co-Chairperson and HB 93 co-sponsor Rep. Wendy Horman, R-Idaho Falls, said Tuesday. “And then there was some late-breaking information by the time it got to the Senate, and this, this motion reflects what the latest information was from the tax commission when it went through the Senate.”

House Bill 93, signed by the governor in February, will allow families to receive a tax credit of up to $5,000 per student, or $7,500 per student with a disability, for educational expenses, which may include private school tuition.

Households earning 300% of the federal poverty guidelines or below may be able to receive the funds as an advance rather than a credit back on their taxes. An income at 300% of the federal poverty level for a four-person household is $96,450, according to the U.S. Department of Health and Human Services.

The bill’s passage marked the first time Idaho will allow state funds to go to private K-12 education.

The fiscal note on the bill originally said the tax commission would need two full-time employees to administer the program.

When the bill was sent to the Senate, the fiscal note was updated to say that one full-time employee would be needed and two existing vacancies would also be put toward the program. There was also an additional anticipated need for five seasonal employees during tax season — the total cost was estimated to be $130,800.

Sen. Janie Ward-Engelking, D-Boise, said she would support the budget, but noted that the seven additional staff were not part of the bill’s estimated fiscal impact. She said she found it “appropriate” that the funding came out of the available $50 million, “since this is to require a lot of staff time and work to even get it up.”

The budget also includes $125,000 in one-time funding for programming and coding costs to implement the credit.

With the budget adjustments, there will be $49.325 million available for the credits.

House Bill 93, upon signature of the governor, went into effect retroactively to Jan. 1, 2025. Families will be able to start claiming the credits next tax year.

Guido covers Idaho politics for the Lewiston Tribune, Moscow-Pullman Daily News and Idaho Press of Nampa. She may be contacted at lguido@idahopress.com and can be found on Twitter @EyeOnBoiseGuido.