Senate can’t overcome Little’s veto of emergency powers bill

Idaho Gov. Brad Little maintained his perfect record Monday in Boise, when the Senate failed to override his veto of an emergency powers bill by a single vote.

Little has vetoed 10 bills since he was elected in 2018, including two this session. He’s also indicated he’ll veto a second emergency powers bill once it reaches his desk.

So far, lawmakers haven’t succeeded in overriding any of the vetoes.

Monday’s vote on Senate Bill 1136 — which put a 60-day limit on certain emergency declarations, unless extended by the Legislature — was particularly dramatic.

Sen. Melissa Wintrow, D-Boise, reluctantly cast the deciding vote upholding the veto, but not before blasting the governor for his decision to sign another bill over the weekend that places new restrictions on the citizen initiative process.

“It’s interesting to me that the (governor) wants my help upholding his power, when he’s not willing to protect the power of the people of Idaho,” Wintrow said. “While I’m embarrassed to do so, and embarrassed by the consolidation of power taking place this session, I will vote to uphold the veto.”

SB 1136 initially passed the Senate on a 27-7 party-line vote. After it was amended in the House, the amended version passed on a 28-7 party-line vote.

Five Republican lawmakers switched positions during Monday’s 23-12 vote. A two-thirds majority was needed to override the veto, or 24 votes.

Sens. Dan Johnson, R-Lewiston, and Carl Crabtree, R-Grangeville, supported the override attempt; Sen. David Nelson, D-Moscow, opposed it.

SPECIAL FUND — Moving on to less contentious matters, the Senate voted 26-9 to support Senate Bill 1204, which creates a separate account for the roughly $2 billion in federal pandemic relief funding the state expects to receive through the American Rescue Plan Act.

The bill explicitly requires legislative approval to appropriate any of the money. That’s a reaction to last year’s coronavirus pandemic, when Little was able to spend more than $2 billion in federal relief dollars without legislative approval because the money was received after lawmakers adjourned for the year.

The measure now moves to the House for further action.

HARD LOOK AT TAXES — The Idaho Legislature lacks a systematic process to review and evaluate the more than $3 billion in tax preferences that exist in state code.

That was the conclusion of a new report released last week by the Legislature’s Office of Performance Evaluation.

OPE analysts Ryan Langrill and Amanda Bartlett presented the report to the Joint Legislative Oversight Committee on Monday. They noted that, while lawmakers systematically review billions of dollars in state spending through the annual budget process, they’re essentially in the dark when it comes to the billions of dollars that are allocated through tax preferences.

Also called tax expenditures, tax preferences are changes in the normal tax code that reduce the amount of taxes someone owes. They include everything from income tax credits and deductions to property tax deferrals and sales tax exemptions.

Their basic purpose is either to incentivize specific taxpayer behavior or to promote equity by reducing an unfair tax burden. They may also promote the same policy goals as budgeted expenses, such as expanding infrastructure investments or encouraging economic development.

The OPE report found that Idaho had at least 122 income and sales tax preferences in 2020, which collectively were worth more than $3.1 billion. That’s nearly three-quarters of the amount the state collected through the two taxes.

Similarly, Idaho has about 44 property tax preferences, which includes the homeowners exemption and a “reimbursement incentive credit” for economic development projects.

How much those 44 preferences are worth isn’t entirely clear, according to the report, since the state only requires counties to submit data on 15 of them. However, those 15 preferences alone exclude more than $38 billion in taxable value from the statewide property tax base. That’s about 20 percent of the $192 billion in property that is taxed.

Rep. Steve Berch, D-Boise, requested the report, together with Rep. Rick Youngblood, R-Nampa, the co-chair of the joint budget committee.

“I think it could be one of the most important pieces of work coming out of the Legislature this session,” Berch said. “It’s really the first step in shining a spotlight on the fiscal policy we have as a state. We approve tax breaks for lots of reasons, but we don’t have a process for reviewing them, to see if they’re doing what we want.”

Berch noted that the report doesn’t “pass judgment” on any existing tax break. It doesn’t offer any recommendations regarding which tax preferences are worthwhile and which aren’t. In fact, its main conclusion is that the Legislature lacks the information needed to make such determinations.

“The Legislature is managing tax policy with relatively little known information,” the report says.

In many cases, for example, it doesn’t even know how much tax revenue is being lost through a particular tax preference, much less whether it’s having the intended impact.

According to the report, nearly three dozen states have a process in place to systematically review at least some of their tax preferences. Should Idaho want to join that group, it outlines several options, ranging from ad-hoc reports to interim committees to a permanent in-house staff review.

The report also provides recommendations on the type of issues the Legislature should consider before moving forward with any systematic process. That includes understanding the goal of the review — for example, whether the intent is to broaden or simplify the tax code, or whether it’s simply to review the effect they’re having — as well as how to incorporate the results in legislative policy decisions.

A full copy of the report can be found on the Office of Performance Evaluation website at bit.ly/3v1Bkdq.

Spence covers politics for the Tribune. He may be contacted at bspence@lmtribune.com or (208) 791-9168.