By Jeff Nafsinger and Rick Just
Property taxes pay for some of the basic utilities you’d expect, including first responders, law enforcement, roads, and schools. As candidates for the Legislative Assembly, we believe in protecting these services while ensuring that the necessary revenues are collected equitably. Unfortunately, the Republican majority in the Idaho Legislature failed on fairness. Since the GOP capped the homeowner’s exemption in 2016, we’ve seen an ever-increasing shift of the property tax burden away from homeowners and away from commercial interests. While residents are seeing their property tax bills rise dramatically, property tax bills are falling for many business-owned buildings. In the name of fairness, we must strike a better balance.
We are among many Idahoans who have received property tax assessments showing big jumps in the value of our homes. We understand why many are worried about whether they will be able to afford to stay in their homes. The good news is that there are simple property tax solutions that would bring us back to a better balance.
First, we need to repair the damage caused by the landlord exemption cap. Our landlord’s exemption automatically increased with market values. This way, as the value of the homes increased, the value of the homeowner’s exemption (the amount that was not taxable) also increased. Republicans in the Idaho Legislature bowed to lobbyists in 2016 and scrapped that annual adjustment. Homeowners lost that protection when their home values began to skyrocket. Lawmakers approved a one-time increase in the maximum exemption from $100,000 to $125,000 in 2021, but it would be valued at $175,000 today if still indexed to home values. In 2016, residents bore 62% of the tax burden, according to an article in the Idaho Capital Sun. This jumped to 71% in 2021.
We talk to owners almost every day to find out what their main concerns are. Many times, rising property taxes are their first or second concern. It’s time to acknowledge that capping the homeowners exemption in 2016 was a mistake we need to fix.
Second, we need to update property tax assistance for seniors on fixed incomes. Our property tax reduction program, the “circuit breaker”, has not kept up with the growth in property taxes. We need to increase the total amount of assistance available, increase the income threshold so more people qualify, and allow residents of all ages to participate.
Third, we must make growth entirely self-financing. Today, local governments can levy an impact fee on new housing developments to pay for new infrastructure (eg sewer lines) that the development will require. This prevents current property taxpayers from subsidizing growth. We need to give school districts that same tool so they can collect impact fees to pay for the portion of new school construction that will be required. The only tool schools now have is the bond, which is paid by all ratepayers in the district. Allowing school districts to collect impact fees would reduce property taxes in parts of Idaho that are experiencing population growth.
Republican lawmakers continue to find the “political will” to offer ever more tax breaks to the wealthy and well-connected. This year they have spent $600 million on rebates and permanent tax cuts. The richer you are, the bigger the check they sent you, all while homeowners of more modest means struggled. Now is the time to meet the needs of families and working seniors in Idaho.
Democrat Jeff Nafsinger is a District 15 Idaho House candidate for the B seat, while Democrat Rick Just is a District 15 senator.