Legislature wraps up session

The Idaho Senate on Thursday approved Gov. Butch Otter's proposal for $35 million in tax cuts for individuals and businesses.

The 28-7 vote broke a legislative logjam that could have sent the 2012 session into next week. The House approved the measure four weeks ago.

The decision, made on the 81st day of the Legislature, was part of a "going home compromise" that also included restoring teachers' salaries.

"They say politics is the art of compromise," said Sen. Jim Hammond, R-Coeur d'Alene, who supported the proposal. "I really wanted to put some money into savings, but in the end this was how things worked out. If we hadn't made the decision, we may have been here another two weeks, and I'm not sure if the outcome would've come out differently.

"It was time to get done and move on."

Proponents said it will reduce individual and corporate tax rates to 7.4 percent, making Idaho more attractive to out-of-state companies.

"I would've preferred to see smaller tax relief and more money in the stabilization accounts, but that was not before us and it was not going to be before us," said Sen. John Goedde, R-Coeur d'Alene. "I felt what we had was our best opportunity."

Dragging out the session wouldn't have been optimal, Goedde said.

"Every day we're not in Boise saves about $30,000 for the state," he said.

Democrats opposed the tax break.

Opponents believe the money should've been used to restore cuts to the state workforce. They also didn't believe Idaho's finances are strong enough to merit the relief.

At the start of the recession, there was $392 million in the stabilization accounts. The amount has been reduced to $35 million. The reserves prevented the state from making more cuts in previous years, legislators say.

Critics said the tax break provides only $71 for families earning $100,000. A family of four with gross income of $80,000 or less will not gain any benefit from the bill.

The Idaho State Tax Commission estimates that about 17 percent of Idaho income tax filers will benefit from the cut.

The Senate's decision late Thursday afternoon came after its Local Government and Taxation Committee voted 6-3 in the morning to send the proposal to the floor with no recommendation.

The last day featured other decisions, including increased rainy-day savings and an education bill that restores teacher salary funding.

That was due to be cut to pay for "Students Come First" education reforms, but lawmakers restored $35 million over the next five years on the final day of the session.

"The Legislature and the governor owned up to that pledge," said Goedde, on restoring teacher funds. "We had to designate a funding stream to move the education reform bill forward last year, and no one liked the way we had to do that."

The signature achievement of this session was adopting the Idaho Global Entrepreneurial Mission, or IGEM, into law. IGEM will spend $5 million in general fund dollars to spur local innovation through research, which supporters said will allow Idaho's businesses and economy to thrive, as a similar program has flourished in Utah that Idaho looked to for its model.

The final day was punctuated by a brief "Occupy Boise" protest, where demonstrators were pulled from the Senate gallery and escorted from the Capitol. The session experienced its share of controversial topics, such as a proposal that would have required women planning to undergo an abortion to first have an ultrasound. That bill went down but lawmakers said it could come up again next year.

Hammond said there wasn't as much tensionbetween the House and Senate this session because the Legislature wasn't in cutting mode as it had been in previous years.

He said he was "tickled" with the passage of his bill that makes texting while driving illegal, a topic that had been discussed in Boise for at least a couple of years.

"That creates an education tool for younger drivers who tend to text more," he said.

Rep. Vito Barbieri also said the atmosphere in Boise had changed this year from last. Redistricting may have had something to do with it, he said, as incumbents who weren't facing re-election voted differently than they would have in years past.

"I think that is a dynamic that may have been in play on both sides," he said.

The Dalton Gardens Republican said more work needs to be done next year, including clarifying governing ethics and conflict of interest rules.

"There's a lot more to be done, but I am satisfied with what we got done this session. But there is a lot more to be done," he said, adding he was dubious that the texting and driving law would prevent people from texting while behind the wheel.

Staff writer Tom Hasslinger contributed to this story.