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Bill seeks to rein in cities’ use of LIDs

An Idaho House committee will give a full hearing to a bill that would restrict cities’ use of local improvement districts to pay for infrastructure improvements without a vote by taxpayers, including the proposed streetcar project in downtown Boise.

Rep. Raul Labrador, R-Eagle, presented a bill to the House Revenue and Taxation Committee Feb. 8 that would require a vote for any projects that would require bonding of more than $250,000. He singled out the cities of Boise and Eagle for pursuing projects that he said are contrary to the intention of the law. Boise officials have been exploring the creation of a local improvement district to pay for part of a $60 million downtown streetcar project, while the Eagle City Council launched a district to buy a private water company before later backing off.

“In the past, LIDs have been used in a very limited way, mostly for small projects that affect a local community,” he said. “In the last few years, very creative people have used LIDs to address countywide or regional issues.”

State law allows for the creation of local improvement districts for a wide variety of infrastructure improvements. Assessments collected from property owners in the districts pay for the projects.

Districts may be initiated with a petition signed by two-thirds of all property owners in a proposed district, or 60 percent of resident owners. A city council may also create one with a majority vote.

The House approved a similar bill to Labrador’s proposed bill in 2008 that would have required a petition or vote for all LID projects that required bonding, though it died in a Senate committee. Labrador said this proposal is “even a little bit more liberal” because it includes the $250,000 minimum requirement.

Still, some lawmakers on the committee wondered how many projects would fall under the threshold.

“That just doesn’t seem like a very high amount for physical improvements in a city area,” said House Minority Leader John Rusche, D-Lewiston.

Lawmakers on the committee also voted to consider two other bills. One would extend a law passed in 2008 that allows counties to grant property tax exemptions to businesses that spend $3 million building new manufacturing facilities in rural areas. The measure would extend the exemption to all areas of the state.

The other measure, designed to benefit Boise-based aircraft service company Western Aircraft, would give a sales tax rebate to out-of-state jet owners who repair their planes in Idaho.


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27 comments

  1. Cities all over Idaho have determined there are no limits to what they can and will do to get around a vote of the people when it comes to spending property tax dollars. LID’s and Urban Renewal abuse are out of control.

    If they want it then let the people paying the bills decide if they want to actually pay for the projects via a proper election and a 2/3’s majority the Idaho Constitution calls for under Article VIII section 3.

    Born free, taxed to death and God only asks for 10%.

  2. I agree will Dave Fotsch’s comment. However, maybe the streetcar scenario requires a wider view than allowed under a LID ordinance. Let’s hope they don’t throw the baby out with the bathwater, though. LID’s have and continue to work all over the country.

  3. Why is it that our political leadership always talks about the government that’s closest to the people being the one that govern’s best, but they actively work to constrain local government’s ability to creatively solve problems?