Idaho lags behind Utah in the number of bonding options and in the ease of passing bonds for economic development and construction projects, according to Tommy Ahlquist, chief operating officer with development firm Gardner Co.
Ahlquist, speaking at the Associated Taxpayers of Idaho’s annual conference on Dec. 10, said it can be difficult for Idaho to get public funding for infrastructure and other improvements. Using data from Zions Bank Public Finance, Ahlquist said projects in Utah, unlike in Idaho, can use bonds from excise tax revenues, lease revenues and special assessments. In addition, it’s easier in Utah to get general obligation or revenue bonds, since they have lower or no requirement for voter approval.
Ahlquist said the recent difficulty in the city of Boise to get bonds for new fire stations — the city’s first effort didn’t receive the two-third voter majority earlier this year before a less-costly bond was approved in November — is a good example of Idaho’s problems.
“If we can’t even get a bond passed to improve our fire stations that are falling apart by a two-thirds majority,” Ahlquist said, “how do we ever get a bond passed that’s ever going to do anything for infrastructure?”
Part of the problem is that elected officials and citizens in Idaho are often unwilling to approve public-sector borrowing.
“You say bonding and debt here, and people start having seizures,” he said.
That difference in borrowing options means Gardner is working on many more large scale projects in Utah, and that state’s economy is outpacing Idaho’s.
“It’s booming,” Ahlquist said about Utah. “Booming’s not the right word. It’s exploding.” Gardner has recently started work on seven projects in Utah that are at least 150,000 square feet in size, and Ahlquist said most of the projects, for companies including Adobe, Vivint and Overstock.com, receive millions in state and local incentives.
Idaho Department of Commerce Director Jeff Sayer, speaking to Ahlquist, said the state has patterned some of its incentives on Utah’s model. Idaho has some flexible bonding and urban renewal opportunities, he said.
“We have been studying Utah and studying it very carefully,” Sayer said. Some of Commerce’s recent initiatives, including the Tax Reimbursement Incentive tax breaks and Idaho Global Entrepreneurial Mission grant program for private sector and university partnerships, were based on similar Utah programs.
Idaho Speaker of the House Scott Bedke, R-Oakley, said he thinks the state should revisit its urban renewal laws, so that economic development projects don’t rely on laws meant to deal with fixing blighted areas.
“I propose that we carve out or write a new chapter in that title that deals with economic development,” Bedke said. He said economic development officials such as Sayer could use another tool.
“They’ve been able to work within our current system, but heavy on the work,” Bedke said. “I think that we can do better in Idaho.”