Idaho Gov. C.L. “Butch” Otter said the state’s recent economic development efforts, specifically new tax credits for businesses that create jobs, have exceeded his expectations. The state’s Tax Reimbursement Incentive program, which awards companies with payroll, income and sales tax rebates, went into law in July and has already been awarded to eight companies pledging to create 1,600 jobs. That incentive program is run by the Idaho Department of Commerce.
“Last year was a banner year for the Department of Commerce,” Otter said Jan. 8 at the Associated Press Legislative Preview.
The governor said recent data he received from the Department shows that interest in the incentives has topped projections. Idaho expected to get five or six inquiries into the incentives from July to January, but received more than 25. He said there are 33 potential TRI projects in the pipeline.
He noted that part of the success of the TRI program is that many of the companies that have received awards are those that already are in Idaho.
“Part of the pushback that we got initially was why aren’t we taking care of the people that are already here,” he said.
The TRI model came partly from a Utah program. Otter said Idaho is unabashed in its willingness to look at other states that have successful programs and turn them into Idaho projects. He also said economic development efforts also depend on a solid education system to produce skilled workers and a safe, efficient transportation system. He said that the Idaho’s Labor, Commerce, Education, and Transportation departments have and need to work together, with Commerce being a “referee” for economic improvement efforts.
“They have to go hand-in-hand,” he said.
Otter has also said he wants to increase education funding in 2015 and hopes that additional funding ideas for transportation are brought up early in this year’s legislative session.
Idaho House Speaker Scott Bedke, R-Oakley, said lawmakers are generally supportive of economic development efforts, but said now lawmakers will scrutinize how TRI’s tax credits are awarded and distributed.
“Now we’re going to go back and see how it worked and see who gets the funds and who doesn’t get the funds,” he said.
Bedke also reiterated his support for adding a new section to Idaho’s urban renewal laws to specifically allow for economic development projects to use tax increment financing.
“We twist the urban renewal statute into economic development. Sometimes that doesn’t fit right and it creates problems and it creates animosity,” he said. He said tax increment financing, which typically takes part of property taxes to pay off construction or other bonds for projects, is an important economic development tool.l