Idaho Briefs August 26, 2010

State's tax revenue could top prediction

BOISE - The state's modest economic recovery should help Idaho finish the fiscal year with $80 million more tax revenue than the 2010 Legislature predicted, if a new forecast holds true.

Gov. Butch Otter's chief economist, Mike Ferguson, issued his new outlook this week for the year ending June 30, 2011.

He said Idaho should take in nearly $2.37 billion by then, or $80 million more than the revenue estimates the 2010 Legislature used to set its spending plan. With the books closed on one month of this fiscal year, Idaho is about $4.5 million ahead of Ferguson's latest revenue projections.

Idaho appears to be just beginning what should be two years of modest recovery. Positive signs are emerging: Micron Technology Inc. has posted three consecutive quarters of profit, finances at wind turbine and solar panel makers in eastern Idaho are stabilizing, and a train manufacturer in Boise - Wabtec Corp.'s Motive Power unit - just won a $115 million deal to supply 20 new commuter locomotives to Boston.

"If the economy continues to have modest improvement, I feel very good about this forecast," Ferguson told The Associated Press on Wednesday. "If the economy goes into a double dip (recession) ... we're probably looking at something more like the legislative number."

Ferguson said concerns linger.

Idaho's unemployment rate remained at 8.8 percent in July.

What's more, concern in Washington, D.C., over the budget deficit could mean stimulus spending that propped up the economy over the last 18 months could come to an abrupt halt.

And just Wednesday, the U.S. Department of Commerce indicated the economic recovery nationwide appears to be stalling as companies in July trimmed investments in equipment and machines and Americans bought new homes at the weakest pace in decades.

"Those are all short term risks that, if they converge into a downturn, will have very serious negative ramifications for the state's finances," Ferguson said.

Even bright spots are tempered by reality: In Twin Falls, for instance, a call center run by Florida-based C3 is hiring many of the more than 600 workers laid off when computer maker Dell Inc. abandoned its own center in February. C3 is occupying the building Dell left vacant.

But state officials point out C3's wages are $9 to $10 per hour, not the $12 to $14 an hour Dell had been paying.

"While people are going back to work, you're seeing underemployment, and wages are still are low," said Division of Financial Management administrator Wayne Hammon. "The takeaway from Ferguson's numbers is ... we're excited to see some growth in the economy, but we still need to be cautious."

Just how Idaho tax revenue fares in coming months will weigh heavily on next year's budget.

Idaho agencies are due to send their proposed fiscal year 2012 spending plans into Hammon by Sept. 2; after that, he'll meet with legislators about just what's feasible. Hammon told the AP he's been warning department heads again to focus on the essential and pare programs that could be put off.

After all, Ferguson could be forced to revise his revenue estimates down - as he's done for two years - if the recovery fizzles.

Rep. Maxine Bell, R-Jerome and co-chair of the Legislature's budget writing committee, said it's far too early for elation over Ferguson's forecast.

"We're only two months into this budget year," Bell said. "Frankly, his number isn't there yet. The money isn't there yet."

Tax board rejects Hart's appeal

BOISE - The Idaho Board of Tax Appeals has rejected a state lawmaker's bid to fight an order to pay $53,000 in back income taxes, interest and penalties, saying the filing was untimely.

Idaho Rep. Phil Hart insists he missed the deadline to appeal because of his status as an elected official. The deadline ran out 10 days before the January start of the 2010 Idaho Legislature.

Hart, who has long argued that income taxes are unconstitutional, filed his appeal on March 31.

The Republican's tax troubles were at the center of a House Ethics Committee investigation last month.

The ethics panel dismissed charges that Hart conflicts of interest in the Idaho Legislature due to his tax problems, but delayed a decision on whether he abused his status as a lawmaker to win delays in his state and federal tax cases.

Former Hayden man charged in racial attack

TACOMA, Wash. - Two white Vancouver men, including an Aryan Nations follower who once ran for public office in Idaho, have been indicted in a racially motivated attack on a black bar patron early this year.

Zachary Beck and Kory Boyd have been charged with conspiracy to violate civil rights and interference with a federally protected right. They were due to make initial appearances Wednesday at federal court in Tacoma.

Prosecutors say the Jan. 7 attack at a Vancouver bar came after Beck demanded that the only black man there leave. They say Beck tried to hit him, Boyd threw a bottle at him and a third man tried to stab him. That man has already been convicted of state charges.

The 31-year-old Beck ran unsuccessfully for city council in Hayden, Idaho, in 2003. That year he was charged with punching a man in a parking lot after asking him if he was Mexican.

Beck pleaded guilty in 2005 to burglary and assault charges after a standoff with Longview police.

ConocoPhillips appeals judge's wide-load ruling

LEWISTON - Oil company ConocoPhillips is appealing an Idaho judge's ruling this week that revoked special state permits allowing four oversized loads of oil refinery equipment through a federally protected river corridor.

Opponents of the shipments on U.S. Highway 12 say the notice of appeal was filed Wednesday in the Idaho Supreme Court.

In Tuesday's ruling, 2nd District Judge John Bradbury ordered the Idaho Transportation Department to review the shipments between Lewiston and Billings, Mont., to ensure public safety and convenience.

Environmentalists fear an accident with the shipments could harm the Clearwater and Lochsa rivers.

Gov. Otter part of Idaho wind park blade signing

HAGERMAN - Gov. Butch Otter was among dignitaries at a ceremonial turbine blade signing this week, marking groundbreaking on what's due to be Idaho's largest wind power project.

General Electric Co. had already announced it was taking a controlling stake in the 11-site project that's valued at about $500 million.

Once completed, its 122 turbines here could generate up to 183 megawatts of electricity, to be sold to Idaho Power Co.

GE's Energy Financial Services unit plans to take advantage of more than $100 million in cash grants offered by the federal government.

These are incentives for renewable energy included in the 2009 stimulus act.

The project will create 175 construction jobs and 25 permanent jobs and will use GE-made 1.5-megawatt turbines. GE will operate and maintain them for seven years.

- The Associated Press