Byron Yankey's blog

"How are you going to do that?"

Wednesday morning I stopped at Winco on my way to school. I had promised Brownies to one of my school teams and I needed a few last minute ingredients. I love Winco very early in the morning. The store is alive with people stocking shelves and there is usually a hyster zipping through the aisles. People are happy, talking loud and joking with anyone who will listen.

Amid this hubbub, I heard. "I thought that was you." I turned to see a parent from one of my former schools. I asked about her family and got a summary of who was where, and what they were doing. I love that.

Then came the question. "I saw you want to get rid of sales tax on food, how are you going to do that?"

Wow, 6:30 in the morning and my first political question of the day!

I explained to her that what we tax is really about choices. I told her we collect sales tax on about $1.1 billion dollars of sales and we exempt over $1.4 billion dollars.  Many exemptions have been in place for over 30 years and some were put in place as a result of a special interest lobbying group. Now is the time for the legislature to systematically review every exemption and determine which ones benefit families and keep those. Other exemptions may need to be eliminated. 

"Good answer," she responded, "I do that all the time with our family finances."

She's right, maybe we need to run state government a little more like a family.

Stan Howland keeps whistling...

Stan Howland is an experienced auditor for the Idaho Tax Commission.  With 28 years under his belt, Stan took a risk when he called for an independent review of how Commissioners settled tax protests from out-of-state corporations. Recently, other auditors joined him in the same request.

In response, Governor Otter appointed LaVern Gentry to conduct a review of the allegations.The results were just released. The Idaho Statesman headline this morning reads, Otter orders changes at Idaho State Tax Commission

BOISE, Idaho — Gov. C.L. "Butch" Otter on Wednesday ordered the Idaho State Tax Commission to clarify settlements of out-of-state corporate tax protests and to report such deals to the Legislature after a recently completed review concluded the agency's existing system creates the perception that commissioners are acting without justification.

Governor Otter's response is a welcome beginning. As stated in his news release,

"These next steps reflect the shared commitment of the Legislature and my administration to building trust in our tax system and the public servants who administer it."

Howland continues to call for an "independent review", a standard he feels has not yet been achieved. Trust is easily lost and sometimes difficult to regain.  That seems to be the case here. Trust in the Tax Commissioners and how they interrupt their responsibilities and obligations for the citizens of Idaho will most likely take further actions and maybe new laws.  Keep whistling Stan!

Saving for a rainy day...it's time to check the weather

Tom Ryder's guest editorial in the Idaho Statesman deserves every one's attention. Many households across our state save a little money when they can for a rainy day. It is a sensible thing to do.

As a result of revenue shortfalls in the early years of this decade, the Legislature began socking away massive reserves to carry us through bad times and protect us from economic downturns.

That sounds to me like a rainy day fund.

The total amount available is hard to figure, since no one is responsible for keeping track of all the pockets where the funds are kept. But reasonable estimates range from $500 million to twice that amount.

[...]

That is a lot of money, but whose money is it and when should it be put to use? Without hesitation, everyone should admit that it belongs to you. It is the taxpayers' money. It does not belong to the Legislature or the governor.

Given all of the needs that could be addressed by using a fiscally responsible amount of this money, the real question is "Why not?"  Why not elect candidates that will respond to the citizens of Idaho and thoughtfully consider the options that will best benefit our state?  And why not check the weather, I think our rainy day has come.

How many ways can you spin "tax shift"?

Sometimes it seems the key to political marketing is how creative a campaign can spin an issue.  My perspective of the Nixon administration is that they operated under these rules: Say it first. Say it loudest. And say it often. After that the message will be seen as truth. That seemed to be the rules according to Nixon. I am wondering if that might be the same strategy being used by the Jim Risch campaign.

Kevin Richert's: Risch's campaign continues to oversell his tax shift is a great read.  The property tax relief engineered by Risch and his fellow Republicans created an expectation for property owners. Most I know have seen their property taxes increase in this short amount of time to levels that wipe out any relief they may have experienced that first year. And oh, by the way, we have all been paying sales tax that was increased by 20% in that famous one day legislative session.  How much public input was considered in the rush to "make history"?

As Richert points out,

.. Risch did cut the unpopular property tax - but by any objective measure, the change represented a tax shift with an increasing burden on the sales tax. Billing it as spending reform is an exaggeration.

Richert concludes by saying,

I am troubled that this campaign keeps trying to oversell Risch's tax overhaul. There's no excuse for that. If the Risch campaign is going to make this tax bill its centerpiece issue, can't these folks at least get all their facts straight and be upfront about the impact.

A comprehensive, long range review of Idaho's tax policies is needed. Any changes that might occur as a result of that kind of review must prioritize the needs of Idaho's working families and small businesses.

Let's all hope that can happen.

When it comes to taxes...taxpayer beware

Today's editorial in the Idaho Statesman  points out why we should be cautious when it comes to tax reform, especially when it is done in a one day session.  Lessons we should learn from the 2006 property tax change:

• Tax cuts are generally tax shifts
• A "temporary" increase in sales tax is seldom temporary
• No one has a crystal ball to predict changes in state and national economies

A comprehensive tax review is needed to preserve an effective revenue stream to meet our future needs while working to eliminate all sales tax on groceries.

To my friends at the Star Cafe...

Hey guys, buried in the Main section of the Idaho Statesman today is an article entitled: Fiscal '08 surplus not a signal that '09 won't be tough. Let me quote part of it:

"The state closed its books with a $223.8 million surplus in the general fund for the fiscal year that ended June 30,State Controller Donna Jones reported Monday.  Department officials attribute the one-time surplus to the carry-over of the $247 million surplus in the general fund from the previous fiscal year..."

(I couldn't find the article on the Idaho Statesman's website, but you can read it here at Forbes)

Wait a minute, I'm confused.  How can this be a one-time carry-over if it was the result of a $247 million "carry-over" from the previous year? The '08 surplus primarily results from what was left over from the previous year.  Here is the math:

            July '07           $243 million surplus
            July '08           $223.8 million surplus

While I'm sure conservative spending did take place this year, really the surplus is down $19.2 million from the previous year.

Our current economic slow down will require lawmakers to make the best decisions.  Let's hope that happens.