Idaho bill would aid road work with sales tax shift
March 17, 2021
One bill moving through the Idaho statehouse would more than quadruple revenue available for a transportation program to benefit road work.
Dubbed the Transportation Expansion and Congestion Mitigation program, the 4-year-old program provides additional funds for statewide construction projects through bonding.
A 2017 law authorized the state to shift a portion of sales tax revenue from the general fund to the transportation program. Specifically, 1% of the state’s sales tax revenue is deposited into the program intended to expand state highways. The sales tax revenue stems from the state’s cigarette tax.
Shot in the arm
The House Transportation Committee has voted to advance a bill to more than quadruple the amount of sales tax revenue made available for the TECM program.
Sponsored by House Transportation Chairman Joe Palmer, R-Meridian, the bill would shift 4.5% of the tax revenue into the transportation program. Essentially, the change would provide a $68 million annual boost for the program.
H314 would permit at least $1 billion in bonding for road work projects at the state and local levels, according to a fiscal note attached to the bill.
Cities, counties and local highway districts would receive 30% of the bond proceeds. The funds would be made available for purposes “including but not limited to” improving traffic flow and to mitigate congestion.
The state would receive the rest of the funds designated solely for traffic flow and mitigation.
Palmer said although he is not 100% comfortable with bonding, it is the right move for the state.
“When we are looking at major projects that need to be done because of the influx of people, and the opportunity we have because of the growth to capture this money and pay for major projects, right now while the interest rates are so low there is no better way of doing it,” Palmer testified.
Critics say they are concerned about the flexibility the bill would give local governments for use of the funds. They want the same restraints for the state to be applied for cities, counties and local highway districts.
The road work funding bill awaits further consideration on the House floor. LL