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Exemption for businesses that invest $3M passes Senate panel

A Senate committee voted unanimously to support a measure that would allow county commissioners anywhere in Idaho to offer property tax exemptions to businesses that invest at least $3 million in new manufacturing facilities.

The Senate Local Government and Taxation Committee approved the measure on March 9.

The bill represents an expansion of a law passed by the Legislature in 2008 that aimed to attract development to rural areas.

The measure would eliminate a requirement that new facilities eligible for the exemption be restricted to rural zones. It would also allow county commissioners to offer the exemption for up to five years without having to annually renew it, allow a leased facility to qualify and include personal property taxes as part of the exemption.

Bill sponsors say the 2008 law excludes the urban parts of Pocatello, Idaho Falls, Boise, Meridian, Nampa, Caldwell and parts of Kootenai County, though it also denies the exemption for development outside of those city limits if sewer and water lines need to be extended from those areas.

Only one county has sought to take advantage of the existing law, according to the sponsors. Clearwater County has granted the exemption to Empire Lumber Co. for the proposed reconstruction of part of a lumber mill destroyed in a fire.

The proposal has been pushed by the Boise Metro Chamber of Commerce, the Idaho Chamber Alliance, county officials and economic development administrators.

Cliff Long, Nampa’s economic development director, told the committee that the incentive could be helpful in attracting new investment to Idaho.

“It’s a tool our competing states have used for a number of years,” he said.

Ray Stark, senior vice present at the Boise Chamber, said it makes sense to extend the exemption everywhere in the state.

“A hundred jobs in Idaho Falls benefits the surrounding area,” he said. “The whole region benefits from economic development.”

The measure passed the House 62-6 on Feb. 22. It next goes to the full Senate.

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