Business cheers Little’s first State of the State

Business leaders praised Gov. Brad Little’s first State of the State speech, specifically calling out improvements to education, Medicaid expansion and reducing government regulations.

“Gov. Little’s State of the State Address was a home run for Idaho’s business community,” said Roy Eiguren, partner with Eiguren Ellis Public Policy. “The governor is providing strong leadership in addressing many of the most crucial issues important to Idaho businesses.”

“There was really nothing in Gov. Little’s State of the State that we didn’t like,” said Bill Connors, president and CEO of the Boise Metro Chamber. “He struck all the right notes for driving Idaho’s continued economic growth and prosperity.”

Little – whose management style is characterized by House representatives as “policy wonk,” compared with previous governor C.L. “Butch” Otter’s “10,000-foot” approach – touched on a number of business areas in his speech, including previous areas of interest such as cybersecurity, occupational licenses and Medicaid expansion.

Business representatives praised Little’s emphasis on education, including completing the current five-year plan, starting another, and raising starting teacher salaries to $40,000, as well as implementing many programs.

“It’s critically important to our employers to have an educated workforce,” said Alex LaBeau, president of the Idaho Association of Commerce and Industry, which was involved in the first five-year plan. “We’re strongly supportive of that.”

In issues where budgets are involved, Little’s initiatives will require the cooperation of the Idaho Legislature, Eiguren noted. But several initiatives were set up through executive order, which last for, at most, four years. These include formalizing an opioid substance abuse plan, implementing sunrise and sundown provisions for new occupational licenses, and requiring state agencies to remove two regulations for every new one they wish to implement – greeted enthusiastically by Idaho’s business community.

“We are committed to working with Gov. Little’s administration and regulators on regulatory reductions to allow banks to better serve their customers and communities, without compromising safety and soundness,” said Trent Wright, president and CEO of the Idaho Bankers Association, in Boise.

Following a campaign promise, Little called for eliminating the tax on groceries for fiscal year 2021 – which begins July 1, 2020 – using the budget surplus. However, because the surplus varies from year to year, including not existing some years, it is not clear how that would work.

“It was not clear to me what exactly the plan is, beyond that the state probably won’t be fiscally ready for the grocery tax repeal until FY 2021,” said Jaclyn Kettler, assistant professor in the School of Public Service at Boise State University, noting that increased funding for education and corrections would probably make grocery tax repeal infeasible this year.

Following another campaign promise, Little called for expanding Medicaid to low-income people, funding the state’s $17.9 million share through budget savings in the Catastrophic Health Care Fund and from the Joint Millennium Fund, the state’s share of a multibillion-dollar class-action tobacco settlement. He did not mention sideboards such as work requirements, though he would like to ensure there is a pathway out of Medicaid, he said.

Some of Little’s proposals lacked details. For example, he asked the Tax Commission to “do all they can” to help ensure Idahoans know they might need to adjust withholding to keep from having large tax bills. He also wanted to “pursue all options to improve broadband connectivity” without saying what they might be.

Little’s budget also called for a 3 percent merit raise for state employees. A recent annual report on Idaho state employee salaries found they were 25.6 percent below the private sector in 2018, compared with 23.9 percent in 2017. While benefits were better, total compensation was still 12.4 percent below the private sector in 2018, down from 12.2 percent in 2017.

Little called out a number of Idaho businesses, including Woodgrain Millworks in Fruitland, Rohinni, an LED manufacturer in Coeur d’Alene, and BiologiQ, which makes plastic out of potato starch in Idaho Falls.